Sitting of 4 August 1975

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

PRIVATE BUSINESS
GREATER LONDON COUNCIL (MONEY) BILL
BRITISH RAILWAYS (NO. 2) BILL
MILFORD HAVEN CONSERVANCY BILL
GREATER LONDON COUNCIL (GENERAL POWERS) BILL
Lords Amendments considered and agreed to.

ORAL ANSWERS TO QUESTIONS
  ENERGY

    National Nuclear Corporation
    Mr. Palmerasked the Secretary of State for Energy if he will make a statement on the signing of the agreement for shareholding in the National Nuclear
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    Corporation, giving the proportion of shares to be held by both public and private interests.
    The Secretary of State for Energy (Mr. Anthony Wedgwood Benn): Discussions for the restructuring of the shareholding of the National Nuclear Corporation are still in progress. I am therefore not yet ready to make a statement.
    Mr. Palmer: Does my right hon. Friend agree that this is a matter of the utmost national importance? Will he give an assurance that there will be no automatic General Electric Company monopoly and that details of any agreement reached will be made known in full to the House of Commons?
    Mr. Benn: I recognise the importance of the point. The GEC has a supervisory contract. When I am in a position to make a statement I shall do so.
    Mr. Patrick Jenkin: As the pressure tube reactor programme has now slipped a full year since the Minister's predecessor announced the Government's decision last year, is it not becoming a matter of great urgency that the structure of the National Nuclear Corporation should be sorted out so that Dr. Ned Franklin, managing director of NPC, should be given clear and firm terms of reference to get on with what is, in the view of the right hon. Gentleman, an essential part of the Government's energy strategy?
    Mr. Benn: Yes, Sir.

    Gas Supply (Rural Areas)
    Dr. Edmund Marshallasked the Secretary of State for Energy whether he will give a general direction to the British Gas Corporation to expand the network of gas supply mains in rural areas.
    The Under-Secretary of State for Energy (Mr. John Smith): No, Sir. The statute imposes a duty to satisfy all reasonable demands for gas only so far as it is economical for the corporation to do so, a matter of which it is the proper judge.
    Dr. Marshall: Is it not in the national interest that all energy consumers should have the widest possible choice of fuel, especially in the rural areas, and that gas should be more widely available as an alternative to oil for central heating purposes?
    Mr. Smith: This involves the commercial judgment of the British Gas Corporation, which looks at each proposition on its merits. If my hon. Friend has any case or area in mind, perhaps he will get in touch with me, after which I shall communicate the details to the British Gas Corporation.

    Oil (Self-sufficiency)
    Mr. Tim Rentonasked the Secretary of State for Energy whether he is satisfied with progress in the North Sea towards achieving self-sufficiency in oil.
    Mr. Benn: Yes, Sir.
    Mr. Renton: Will the Secretary of State say how long he thinks that self-sufficiency will last? Will he give a guarantee to the nation of non-interference by himself so that this vital self-sufficiency will not be put at risk by his blunders?
    Mr. Benn: The hon. Gentleman asks me about progress towards achieving self-sufficiency. He is now inviting me to look forward into the future to see how long the oil under the North Sea will last after it has been discovered. I think that on reflection he will agree that that was not an easy question to answer. I cannot answer it.
    Mrs. Bain: Does the Secretary of State accept that Scotland could be self-sufficient
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    in oil within a matter of months and that it could remain self-sufficient in oil for much longer than could Britain, if we are considering merely North Sea oil? Will he make a comment on the importance of the relationship between the Scottish Assembly, which will govern a country rich in oil resources, and England, which will be importing oil?
    Mr. Benn: Although I understand the hon. Lady's interest, I think that she has somewhat oversimplified these problems. She will recognise that until we are able to accomplish participation, and indeed a new framework, the oil, or any part of it, will in no sense belong to the people of this country.

    Coal Industry (Finance)
    Mr. Ridleyasked the Secretary of State for Energy what percentage increase in the price of coal would be necessary—taking no account of the elasticity of demand—for the National Coal Board to cover its costs including interest on capital.
    The Under-Secretary of State for Energy (Mr. Alex Eadie): The board aims to break even in the current financial year after covering its costs, including interest on capital.
    Mr. Ridley: I am glad to hear that. Is there any chance of recouping some of the enormous amount of capital we have written off for the National Coal Board in past years? Does the Minister agree with Mr. Arthur Hawkins that there is now no scope for increasing the price of coal without making it un-competitive against the price of oil?
    Mr. Eadie: I think that the hon. Gentleman is on another tack and is hiding his chagrin at the substantial progress that is being made by the coal industry. Mr. Arthur Hawkins must be responsible for his own statements. We live in a world in which energy must become more and more expensive.
    Mr. Patrick McNair-Wilson: Does the Minister agree that one of the best ways of improving the National Coal Board's finances would be to increase productivity? Will he explain to the House why productivity has been falling since March although recruitment has been increasing?
    Mr. Eadie: The hon. Gentleman is correct. In two months—I think in May and June—to some extent productivity fell. The hon. Gentleman will probably have read in the Press that the unions and the National Coal Board are to cooperate and hold meetings to discuss the reasons for this fall. One reason is the training problem with new entrants to the industry. As the hon. Gentleman is well aware, there are also serious geological problems.
    Sir John Hall: Does the Minister agree that if we could get our productivity even within striking distance of the productivity achieved in Germany, Luxembourg and France, it would have a dramatic effect on prices and the general cost of coal in this country would go down very sharply?
    Mr. Eadie: I do not agree with the hon. Gentleman's precise analogies. I have been to Western Germany and seen how coal is produced there and some of the technological progress which has been made. Although Germany has made technical progress, I think the hon. Gentleman will like to know that we in this country have nothing to be ashamed of in our technological progress. I have already said that the men, management and unions are seized of the problem of trying to increase productivity. They have substantially increased productivity over a period.

    Nationalised Industry Chairmen
    Mr. Grayasked the Secretary of State for Energy when he next expects to meet the chairmen of the nationalised energy industries.
    Mr. Benn: I meet the chairmen regularly, but a collective meeting is now unlikely before the early autumn.
    Mr. Gray: Does the Minister agree that he is in duty bound to convene a meeting at an early date so that he can explain to the chairmen collectively what measures he proposes to take to regain their confidence, which has been wholly shattered after the revelations about Court Line and the right hon. Gentleman's failures and to some extent by the steel review? Does not the right hon. Gentleman think that his own fallibility in taking top-level decisions is in question?
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    What does he propose to do about trying to regain the confidence of the chairmen?
    Mr. Benn: Last month I organised a collective meeting with the chairmen which had to be deferred because the Petroleum and Submarine Pipe-lines Bill came forward at rather short notice. I share the view that relations between Ministers and chairmen of nationalised industries are important but I have always taken the view that Ministers, being accountable to the House, have concerns that they have to safeguard. I have sought to do that and I intend to do so in the future.
    Mr. Arthur Lewis: Will the Minister discuss with the chairmen the ludicrous position that calls in the Press and on television day in, day out for the conservation of energy are followed by advertisements telling people to go to this or that electricity showroom or gas showroom to buy new equipment? Should there not be one showroom for gas and electricity and one meter reader to read both gas and electricity meters? Should there not be co-ordination to cut down expenses and possibly to reduce the number of chairmen and so that one chairman runs the two boards?
    Mr. Benn: My hon. Friend will know that the possible combination of showrooms is under discussion. I have written to the consultative committees about it. I hope my hon. Friend will also recognise that some of the most wasteful appliances that are in use are old appliances, and if they were replaced by new ones energy would be conserved. [Interruption.] If my hon. Friend puts a supplementary question to me he must let me reply. There are many modern appliances that produce great economies, not only to the householder—
    Mr. Lewis: But why not all in one place?
    Mr. Benn: If my hon. Friend will rise to his feet I will allow him to ask endless supplementary questions. New appliances can save energy, and one would expect that information about them should be made available to customers.

    North Sea Oil (Nationalisation)
    Mr. Peter Morrisonasked the Secretary of State for Energy what is his up-to-date estimate of the capital cost of his

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    proposed nationalisation of oil interests in the North Sea.
    Mr. John Smith: I have nothing to add to the answer which my right hon. Friend gave to the hon. Member for Mid-Sussex (Mr. Renton) on 30th June.—[Vol. 894, c. 304.]
    Mr. Morrison: Is the Minister aware that the pound fell by as much as one cent. this morning and that sterling will continue to fall as long as he and his right hon. and hon. Friends continue to confirm that the Government are spending thousands of millions of pounds on projects such as the nationalisation of North Sea oil?
    Mr. Smith: I think that on reflection the hon. Gentleman will realise that that is wild exaggeration. He should be aware that the cost of participation after a time will be self-financing.
    Mr. Dalyell: Has a decision been taken on the salary of the Chairman of BNOC?
    Mr. Smith: No, Sir.

    Power Stations (Coal Stocks)
    Mr. Brothertonasked the Secretary of State for Energy if he is satisfied that the level of coal stocks held at power stations is adequate.
    Mr. Eadie: Yes, Sir.
    Mr. Brotherton: Is the Minister aware of the widespread concern at the level of coal stocks held at a number of power stations throughout the country? Will he bear in mind the statement made by leaders of the National Union of Mine-workers never again to allow large stocks of coal to be held at power stations? Will he assure the House that steps will be taken before the onset of winter to repair the present situation?
    Mr. Eadie: I can only give the hon. Gentleman the facts. The stocks at the moment are about 17½ million tons compared with 11·8 million tons at the same time in 1974 and 19 million tons in 1973. I think the hon. Gentleman will agree that the stocking position has substantially improved.

    North Sea Oil (European Community Proposals)
    Mr. Skeetasked the Secretary of State for Energy what recent proposals
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    have been made within the EEC regarding the availability within the Community of North Sea oil.
    Mr. John Smith: There are no specific proposals. However, the EEC Council of Ministers resolved on 17th December 1974 to pursue a target of a Community oil production—both onshore and offshore—of at least 180 million tons per annum by 1985. This target does not bind individual member States.
    Mr. Skeet: Is the Under-Secretary aware that Mr. Simonet said that Britain would hog its oil? As we shall be the only large producers in Europe by 1980 or 1985, should not the Government make up their mind what to do with the oil? Is it to be made available to Europe at world prices? What is the Government's depletion policy?
    Mr. Smith: As the hon. Gentleman knows, the Government repaired a deficiency in the statutory powers available to them by introducing proper depletion controls for the first time in the Petroleum and Submarine Pipe-lines Bill. The question of the extent to which we should deplete our oil resources is a difficult problem to resolve, involving consideration of the amount of oil in our sector. The tone and manner in which Mr. Simonet speaks to the European Parliament is, thankfully, not a matter of ministerial responsibility.
    Mr. Sillars: Will my hon. Friend confirm that, unlike the Common Market food surpluses, we shall not sell our oil surpluses to the Russians?
    Mr. Smith: My hon. Friend is, I am sure, aware that we have no obligation to export to the EEC, although no doubt we shall consider it to be a natural market for some of the oil we produce.
    Mr. Patrick Jenkin: As the figure of anticipated British production which was given to the Community was 180 million tons by 1985, how comes it that the British Government do not consider themselves bound by it?
    Mr. Smith: The right hon. Gentleman is quite wrong on that. The figure is for the whole Community production and includes present Community oil production of 10 million tons. I understand that the EEC took the figures in the Brown Book issued by the British Government

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    as the basis for the British component of the European total, but it is a European total. In future one will have to take into account within that 180 million tons oil acquired from La Mer d'Iroise in the French sector, the Greenland concessions which for this purpose are part of the EEC and also the Irish sector. It will be readily seen that much more than British resources are involved in the 180 million tons.
    Mr. Skeet: As the answer to my Question is totally unsatisfactory, I beg to give notice that I shall raise the matter on the Adjournment at the earliest opportunity.

    Waste Heat Recovery
    Mr. MacFarquharasked the Secretary of State for Energy what measures he is taking to encourage British industry to harness the wasted heat from factory chimneys.
    Mr. Eadie: Recovery of waste heat is a technique already widely practised in industry, but there is scope for its further extension. The Government's energy conservation campaign seeks to encourage industry to review critically all aspects of its use of energy.
    Mr. MacFarquhar: I thank my hon. Friend for that reply. Is he aware, however, that a firm called Peter Brotherhood, of Peterborough, has apparently made a breakthrough in the technology of this subject but that successive British Governments have failed to make use of the technique, although American firms have seen its value and have signed large contracts? Will he have an investigation made as a matter of urgency into this apparent technological breakthrough?
    Mr. Eadie: I will do so.
    Mr. Rost: Since this is another demonstration of the Government's lack of sense of urgency about energy conservation, should not more funds be made available for this purpose rather than for nationalisation?
    Mr. Eadie: The hon. Gentleman knows that what he has said is not true. He knows very well that the Department's chief scientist has been examining this whole question. In the "Save It" campaign there will be publications and publicity to assist towards conserving heat.
    Mr. Ward: I welcome my hon. Friend's undertaking to look at the Peterborough invention, but will he also look at the steps which could be taken greatly to improve the efficiency in energy consumption of Battersea power station, in particular through the use of pulverised domestic refuse taken from Cringle Dock, which I believe the GLC is anxious to develop with the Central Electricity Generating Board, which apparently is being rather slow in coming to a decision?
    Mr. Eadie: My right hon. Friend the former Secretary of State for Energy said that the Government were not proud in issues of conservation. We will examine any proposition put to us from either side of the House.

    Summer Time
    Mr. Biffenasked the Secretary of State for Energy what further discussions he has had with interested parties in the United Kingdom concerning EEC proposals that summer time should be restricted in order to promote energy conservation; and if he will make a statement.
    Mr. Eadie: The Commission's proposal is not that summer time should be restricted but that it should be introduced in those member States which do not have it, and that the dates of summer time should be harmonised by mutual agreement. Primary responsibility for a summer-time arrangement in the United Kingdom rests with my right hon. Friend the Secretary of State for the Home Department, who will be considering, with others concerned, whether the EEC discussions give rise to a need for consultations.
    Mr. Biffen: Is the hon. Gentleman aware that any tampering with our present summer-time arrangements would give rise to widespread resentment? Can he therefore indicate whether, in his judgment, there is very much substance in the argument that an alteration in any way of the summer-time arrangements could conserve energy?
    Mr. Eadie: I have pointed out that we shall be talking about mutual arrangements. Clearly the experience of the United Kingdom would come into any negotiations or discussions on the matter. Other aspects, such as those involving transport, are matters for the Ministers concerned.
    Mr. Heffer: Will my hon. Friend inform the Secretary of State that we have had enough of this mucking about with our summer time? We had the experience under the last Labour Government when someone took a Bill out of a pigeon hole and a new arrangement for summer time was foisted on us. Do not let us have any such nonsense again. Let us remain precisely where we are.
    Mr. EadieI am aware of my hon. Friend's views. No doubt he is referring to the use of British Standard Time. I think the whole House agrees that the disadvantages were found to be greater than the advantages.

    North Sea Oil (Landing)
    Mr. Canavanasked the Secretary of State for Energy when he expects the first consignment of North Sea oil to land at Grangemouth.
    Mr. John Smith: British Petroleum is in close touch with my Department and keeps us fully informed of progress. It is not practicable to state a precise date, but BP advises me that it expects the first oil to arrive about the end of October at Grangemouth. Production at the wellhead will have started some weeks before then and the interval is required to fill up the long pipelines under sea and on land.
    Mr. Canavan: In order properly to celebrate this auspicious occasion, will my hon. Friend organise a reception, to which would be invited representatives of BP, the Scottish TUC, local Labour councillors, Members of Parliament and his own good self, all of whom are working hard to provide more jobs for Scottish workers in the oil idustry? Will he also confirm that virtually every drop of oil from the Forties field will be piped to Grangemouth? Does he agree that certain remarks made a few weeks ago when the first batch of North Sea oil was landed in the Thames Estuary were merely typical of the churlish chauvinism of the Scottish National Party?
    Mr. Smith: My hon. Friend has interesting ideas on the question which no doubt BP will note. I agree that this is a very important occasion and one worthy of widespread celebration. In relation to the comparison with the Argyll field, I am glad to note that my hon. Friend is seized
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    of the point. What is ridiculous in certain comments about the Argyll field situation is that on any median line basis it would fall in the English sector and that for others to claim it is simply economic nationalism or imperialism on their part.
    Mr. Gray: When the oil flows freely to Grangemouth, will the hon. Gentleman indicate whether the Government are of opinion that the present refining capacity is sufficient to cope with it or whether it is likely that further refineries will be required? Will he make a statement on that subject to an early date?
    Mr. Smith: My right hon. Friend the former Secretary of State for Energy made an extremely important statement on refining policy on 6th December, and that remains the general view of the Government. The main problem in relation to North Sea oil is changing the type of refining capacity so that it can take North Sea oil instead of the crude oil from the Middle East which has been the traditional source of supply.

    Winter Supplies
    Mr. Sillarsasked the Secretary of State for Energy what measures he is planning to secure adequate energy supplies and savings for the coming winter.
    Mr. Benn: I am currently advised that stocks and supplies should be adequate to see us through the winter. Contingency plans are available should they be needed. I shall continue to develop measures to achieve savings, including the current publicity campaign.
    Mr. Sillars: Is my right hon. Friend satisfied that the Department's contingency plans cover the worst that could happen this coming winter, such as severe weather after four mild winters and also a substantial increase in the cost of Middle East crude? Both these factors are possible.
    Mr. Benn: I am grateful for what my hon. Friend has said. Any Secretary of State for Energy may run the risk in the winter of having to look back on an overoptimistic forecast made on a hot summer day. I underline what my hon. Friend has said. The House and the country should know that in winter there are risks from weather and of other

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    interruptions and dislocations, so we have to be careful. Contingency plans have been prepared with that in mind.
    Mr. Emery: What has been the expenditure of the Government on the conservation advertising programme carried out so far? What is to be the budgeted figure for the remainder of the year?
    Mr. Benn: That is another question, but I will furnish the hon. Gentleman with the precise figures.
    Mr. Palmer: Should it not be a matter of concern to my right hon. Friend that the consumption of electricity is actually down on what it was three years ago, and that this is the first time there has been such a situation in the history of our electricity supply industry? Consumption has been dropping over the past two years. Does not this situation reflect the low level of industrial productivity? Should not this be a matter of grave concern to the Government?
    Mr. Benn: Yes, Sir. My hon. Friend has an unrivalled knowledge of the industry and is quite right in what he has said. As a result of the recession, the consumption of electricity is well below what it has been and could be. That gives us some margin, but no satisfaction should flow from that margin because it still leaves the hazards of the winter in the electricity supply and other fuel industries.
    Mr. Evelyn King: Even on a hot summer's day, can the right hon. Gentleman say what research his Department or any other agency is conducting into solar heating, domestically or industrially? If so, what results, if any, have there been?
    Mr. Benn: There is, of course, as the hon. Gentleman will know, the Energy Technology Support Unit at Harwell. There are a number of national and international programmes, including the topic of solar energy, although our normal weather conditions do not make solar energy top priority in the United Kingdom. However, there are other forms of non-conventional energy consumption which are being vigorously explored.

    Production Targets
    Mr. Edwin Wainwrightasked the Secretary of State for Energy what are
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    the Government's targets for the production of coal and North Sea oil and gas in tons of coal equivalent for the present year, and for the years 1976, 1977, 1978, 1979 and 1980, respectively.
    Mr. Benn: The Government do not set targets for the production of coal, North Sea oil and gas.
    Mr. Wainwright: Does my right hon. Friend realise that some people will regard his reply with doubt in terms of the Government's efficiency in looking at future energy supplies? Is he aware that the cost of the oil from the North Sea could be so high that the oil supplied from the OPEC countries could undersell it at any given time? Therefore, will my right hon. Friend give further consideration to our having a national fuel policy, taking into account greater investment required in coal mining so that we can make it more attractive and recruit more men and youths into the industry?
    Mr. Benn: I appreciate what my hon. Friend has in mind, but he will recall that the forecasts contained in the 1967 White Paper were considered unwise. Therefore, such forecasts are not in my mind. He will also know that a number of major statements on fuel policy have been made by the Government since we came into office, including a tripartite coal examination with its long forward planning in respect of investment in coal. He will appreciate that the present Government are seeking to give coal its proper place in the development of our indigenous resources.
    Mr. Alexander Fletcher: Will the right hon. Gentleman forecast how many years he thinks it will take for BNOC to equal the skill of operation and efficiency of the major oil companies operating in the North Sea?
    Mr. Benn: Longer than it should—if the Opposition continue attacking it.
    Mr. Alexander Wilson: Does my right hon. Friend agree that to some extent his reply to my hon. Friend the Member for Dearne Valley (Mr. Wainwright) was disgraceful? Since we are estimated to have a reserve of over 800,000 million tons of coal in this country as distinct from an unknown quantity of oil under the North Sea, is it not more realistic that my right hon. Friend and his Department should

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    set a target for the coal mining industry as something at which to aim?
    Mr. Benn: My hon. Friend, who knows the coal industry very well, will appreciate that in the tripartite coal examination report—of which there was published last year both an interim and a final version—the Government committed themselves to a substantial increase in investment. They endorsed plans to stabilise deep mine production at 120 million tons a year until 1985. They also accepted a capital programme aimed at increasing opencast production to 15 million tons a year. We have no fixed upper limit of coal use, and the Government have done all they possibly can to encourage the mining industry, in which they very much believe.
    Mr. Patrick Jenkin: Since the question concerns gas, will the right hon. Gentleman now apologise to his hon. Friend the Member for Dearne Valley (Mr. Wainwright) for misleading him last week over the ICI gas contract? Does he not realise that to brandish "phoney" figures of that kind demonstrates yet another example of the Secretary of State's capacity to mislead with his foetid imagination?
    Mr. Benn: The right hon. Gentleman is totally wrong again, as on so many other occasions in the past. I was asked a question, without prior notice, in the Select Committee about a matter into which I had inquired. I gave the information which was available to me and wrote to the Chairman of the Committee publishing the comments made by the Chairman of the British Gas Corporation.

    Scotland (Secretary of State's Visit)
    Mr. Dalyellasked the Secretary of State for Energy if he will make a statement on his official visit to Scotland.
    Mr. Benn: I had a series of meetings with regional authorities, oil companies and unions, including the STUC, and with the Offshore Supplies Office staff. I also had the opportunity to see at first hand some of the activities on one of the offshore oil production platforms in the Forties field.
    I was most impressed with the scale of the operations and stressed the need for a greater share of equipment orders
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    to come to home suppliers, and the desirability of facilitating the work of the trade unions.
    Mr. Dalyell: Did my right hon. Friend learn anything about the need for greater safety in North Sea diving?
    Mr. Benn: Yes, Sir. Efforts are being made to deal with the hazardous problem facing divers, and I am sure that trade union involvement will be beneficial on the safety side.
    Mr. Prescott: Is my right hon. Friend aware that we are not prepared to tolerate the number of deaths and accidents which occurred last winter? Will he take steps to bring in an order under the safety health legislation to remove the exemption of North Sea industry and to ensure that we have legislation to cover safety committees and trade organisations on rigs?
    Mr. Benn: I had the opportunity when in Aberdeen of meeting the inter-union off-shore committee. That committee raised with me the problems of access to rigs by trade union officials and also other matters, because it was felt that the trade union representatives were not as involved as they should have been. I echo my hon. Friend's concern about safety matters. I have asked whether those concerned will prepare for consideration a charter in this respect which I intend to discuss with the four major unions, the T&GWU, the AUEW, the Boilermakers and my hon. Friend's union, the National Union of Seamen. I shall be in touch with the oil companies on this matter because I regard safety and trade union representation as going side by side in this respect.

    Conservation
    Mr. Rostasked the Secretary of State for Energy if he will make a statement on the progress of the Government's energy conservation programme.
    Mr. Eadie: The Government's energy conservation programme continues to progress and the figures for energy consumption this year provide grounds for encouragement. The publicity campaign is continuing with increasing emphasis on advice to industry for which a pamphlet will shortly be published.
    My right hon. Friend will now be taking into account the recommendations he has received from his Advisory Council

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    on Energy Conservation and looks forward to reading the report of the Select Committee on Science and Technology.
    Mr. Rost: When will the Government stop tinkering with energy conservation matters and give them a higher priority? If the Government can find £1 billion to nationalise North Sea oil and can find a further £1 billion to set up the BNOC, why cannot they find relatively small sums to indulge in constructive capital investment in fuels which will produce a more rational energy use and bring a positive return to the national economy?
    Mr. Eadie: If the hon. Gentleman will not believe the Government's reply on this subject, perhaps he will believe the evidence in the large industries concerned which have made substantial savings in energy conservation. That is the important fact, and the evidence can be examined. The hon. Gentleman will know that there is a scheme covering grants and loans which is of assistance to industry. Nevertheless having heard the hon. Gentleman's supplementary question, and remembering that he fought the last election on a freedom platform, I am beginning to conclude that he sees the conservation campaign being achieved only by the introduction of the most Draconian measures.
    Mr. Michael Marshall: Will the Minister confirm that among the energy conservation measures which should commend themselves to the House are long-term contracts such as those between the British Gas Corporation and ICI? Will he take the opportunity, since the Secretary of State for Energy would not do so, to apologise to, in addition to the hon. Member for Dearne Valley (Mr. Wainwright), the Chairman of the British Gas Corporation for the partial, selective and misleading information he gave to the Select Committee on Nationalised Industries? Will he tell the House whether he agrees that his right hon. Friend the Secretary of State is slipping badly even in his new job?
    Mr. Eadie: I do not know whether my right hon. Friend is "slipping badly" but certainly the hon. Member for Arundel (Mr. Marshall) must have defective hearing. His supplementary question was answered previously by my right hon. Friend. I do not know why the hon. Gentleman has to pose a point which has already been answered.

    Pneumoconiosis Compensation Scheme
    Mr. Gwilym Robertsasked the Secretary of State for Energy what recent representations he has received from the unions and the National Coal Board on the need for further Government financial support for the pneumoconiosis compensation scheme.
    Mr. Eadie: The National Union of Mineworkers raised the matter during my right hon. Friend's meeting with it on 23rd June and mentioned it again in a letter dated 4th July.
    Mr. Roberts: Will my hon. Friend accept that whereas the new scheme is widely welcomed in the mining communities, there is a gap in the scheme's existing arrangements in respect of widows and commuted cases? Does he agree that if the Government were prepared to find a few additional million pounds for the scheme these cases will be brought into its ambit?
    Mr. Eadie: I am obliged to my hon. Friend for mentioning that the pneumoconiosis scheme is of great benefit to thousands of people. The fact that the Government made a £100 million contribution has gone some way to assist the situation. I should like to make it clear to my hon. Friend that although we are talking in terms of sums of money there is no danger of any legitimate claims not being met. The scheme was drawn up between the National Coal Board and the NUM. It is for those parties to discuss any amendments to the scheme such as those my hon. Friend has outlined to the House.
    Mr. Kelley: Is my hon. Friend aware that the present situation as a result of the scheme seems to indicate that a proper actuarial assessment was not made of the amount of money required to do justice to all the people who have been referred to by my hon. Friend? Is he aware that there are people who have settled out of court for minimal sums although they suffer from a high degree of disability? There are the widows who lost their husbands in the same circumstances as widows who lost their husbands after the specified date, but they receive only a miserable sum. Should there not be a

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    proper actuarial assessment of the money required?
    Mr. Eadie: My hon. Friend has drawn the attention of the House to the anomalies that exist in the scheme concerning commuted cases and the question of widows. I must remind him that the scheme was drawn up between the National Coal Board and the NUM. It is not a departmental scheme. It was not calculated actuarially as such by the Department but was discussed and agreed by the NUM and the National Coal Board. I hope my hon. Friend will agree that the starting of the scheme with £100 million has made a substantial contribution towards the scheme which has been beneficial to so many people.

    North Sea Oil (Extraction)
    Mr. Gowasked the Secretary of State for Energy whether he will make a statement about the progress which is being made in the extraction of oil from the North Sea.
    Mr. John Smith: I would refer the hon. Member to the answer given on 30th June by my right hon. Friend to the hon. Member for Glasgow, Cathcart (Mr. Taylor).—[Vol. 894, c. 303–4.]
    Mr. Gow: What special contribution does the Minister hope will be made by BNOC to the speedy and efficient extraction of oil from the North Sea? What lessons will he learn from the history of other nationally-owned corporations which should be applied in the case of BNOC?
    Mr. Smith: I am confident that BNOC will make a constructive contribution to the exploitation of our Continental Shelf resources. It will also secure for this country adequate control and a proper return on what is a very important national asset.
    Mr. Alexander Wilson: Will my hon. Friend inform the official Opposition that their continued sniping at old-established nationalised industries is all to no avail when we are discussing the coal industry? After all, we have spent millions of pounds to restore years and years of Conservative neglect of the coal industry, whereas oil is a virgin area and we are dealing with it in the right way by taking public control.
    Mr. Smith: I agree with my hon. Friend that the Opposition are behaving true to form.

    Gas and Electricity Disconnections
    Mr. Teddy Taylorasked the Secretary of State for Energy how many households have had gas and electricity supplies, respectively, cut off because of the non-payment of accounts in the most recent annual period for which figures are available; and by what percentage these figures have increased or fallen compared with five years previously.
    Mr. Benn: As the detailed information requested is not readily available, I will ask the chairmen of the industries to write to the hon. Member. I am sure my right hon. Friend will be glad to take similar action in relation to the electricity industry in Scotland.
    Mr. Taylor: Is not the Minister aware that this information is available in Scotland and that I have obtained it? Is it not outrageous for the right hon. Gentleman, when he is increasing electricity prices by such a substantial amount, not to have information about the number of people whose supplies of electricity and gas are cut off because they are unable to pay their bills? Is this not a major and frightening problem in Britain? Should not the electricity boards be instructed by the Minister, as are the gas boards, to ensure that every possible way of making the payment of bills easier should be investigated, and in particular the direct payment of bills of people on long-term benefit by the Supplementary Benefit Commission?
    Mr. Benn: The hon. Gentleman must know that I am not the Minister responsible for the South of Scotland Electricity Board. I can give him only the England and Wales figures. In terms of electricity, the number of domestic and commercial consumers disconnected was 120,000—that is, 0·7 per cent. of the total number. The figure for gas is about 34,000 cut-offs, or 0·36 per cent. of credit customers. I share the hon. Gentleman's concern. I am very anxious about the winter with substantially higher bills for gas and electricity consumers coming at a time when there will be a number of people unemployed, others on short time and others facing various difficulties. I have, as I promised the House, seen the

    21
    Chairman of the Electricity Council about the matter. I am writing to him as well as to Members of Parliament about the position, because it is of great concern to the whole community that a general desire to bring the nationalised industries into balance should not be followed by disconnections of a kind that would create serious hardship for many families.

  OVERSEAS DEVELOPMENT

    Mozambique
    Mr. Blakerasked the Minister for Overseas Development whether he has now had discussions with the Government of Mozambique about aid to that country; and if he will make a statement.
    The Minister for Overseas Development (Mr. Reg Prentice): No discussions have taken place since my predecessor met with President Samora Machel in Dar es Salaam earlier in the year. The new Mozambique Government will obviously need time to take stock of the country's economic situation, but I hope that they will be in a position to begin detailed negotiations in the near future.
    Mr. Blaker: Does the right hon. Gentleman agree that there are two questions concerning this matter? The first is the question of any bilateral aid we may give and the second is the question of any aid that may be given in the context of the imposition of sanctions. Will he give the House an assurance that if we give aid in the latter context it will be only as part of a general arrangement involving other countries and under the United Nations?
    Mr. Prentice: Certainly there are two aspects to this matter. On sanctions, Mozambique as a member of the United Nations will, we assume, carry out United Nations policy in this respect. Any aid that we give would not, of course, be conditional upon that but would be in support of Mozambique in its problems as a country applying sanctions along the lines which were described, for instance, in the communiqué on the Commonwealth Prime Ministers' conference at Kingston. We hope that other donor countries in the United Nations will also provide aid.
    Mr. Biggs-Davison: Is not the Mozambique economy deeply dependent
    22
    upon port and rail traffic with and miners' remittances from Malawi, Swaziland, Rhodesia and South Africa? As the Government are rightly anxious to help the development of this territory, should they not do everything to encourage co-operation and conciliation—not confrontation—between the different parts of Southern Africa?
    Mr. Prentice: Of course we would encourage co-operation in general terms, but in the case of Rhodesia it is our policy and United Nations policy that sanctions should be applied.

    World Food Council
    Mr. Hooleyasked the Minister for Overseas Development if he will publish a White Paper on the recent proceedings of the World Food Council.
    Mr. Prentice: No, Sir. The first session of the World Food Council was of short duration and mostly concerned with work of a preparatory and organisational nature. The Written Answer which my hon. Friend the Parliamentary Secretary gave to a Question from the hon. Member for Rochdale (Mr. Smith) on 3rd July—[Vol. 894, c. 531.]—gives a brief account of the results of the first session.
    Mr. Hooley: Is my right hon. Friend aware that the British decision to contribute 100,000 tons of fertilisers at that meeting at a cost of £15 million is very welcome? Can he now take an initiative in the World Food Council to consider the consequences on world food supplies of the very large-scale purchases by the Soviet Union in the world grain market, which could produce a situation similar to that which occurred a year or two ago which disrupted the whole pattern of grain supplies throughout the world, especially to the developing countries?
    Mr. Prentice: On the first point, I thank my hon. Friend for his remarks. On the second point I should like notice, but I shall certainly consider what my hon. Friend has said.
    Mr. Grylls: Will the right hon. Gentleman confirm that it is the Government's policy to concentrate their aid overseas on helping countries to grow their own food and that they will concentrate on rural development schemes because that

    23
    is the real long-term answer to helping the less-developed countries?
    Mr. Prentice: Yes, Sir. It is our policy to concentrate more of our aid on agriculture and, indeed, on rural development generally. I hope to present shortly a White Paper which will spell out our policy in more detail.

    Aid Policy
    Mr. Canavanasked the Minister for Overseas Development whether he intends any adjustment of the policies of his Department, in view of Her Majesty's Government's anti-inflationary policy as outlined in the White Paper "The Attack on Inflation", Cmnd. 6151.
    Mr. Prentice: No, Sir.
    Mr. Canavan: Bearing in mind that it is usually the poorest countries which suffer most from the effect of world inflation and that it is the philosophy of the Labour Party to give most help to those who are most in need, will my right hon. Friend enlarge on his answer and state clearly and categorically that, despite the savage cuts in public expenditure outlined in the White Paper, there is no intention on the part of the Government of further decreasing the percentage of our gross national product which we spend on overseas aid?
    Mr. Prentice: A reduction was announced in April of £10 million in what would have been the programme for 1975–76 and for 1976–77. Beyond that, public expenditure in general is under review and I cannot anticipate the result.
    It is our stated intention as a Government to move as quickly as we can to the fulfilment of the United Nations target of 0·7 per cent. of gross national product. Meanwhile, within our aid programme we shall give greater priority than hitherto to the very poorest countries—those with a per capita income of $200 per year or less—and to the poorest groups within developing countries.
    Mr. Donald Stewart: Does not the right hon. Gentleman agree that some adjustment is necessary in the case of India, which has been able to construct and explode a nuclear bomb? If the Indians can divert resources of that kind to such activities, surely India should not
    24
    get any hand-out from the United Kingdom in present circumstances.
    Mr. Prentice: I do not think that Member of the House should describe development aid programmes as hand-outs. They are a contribution which the more affluent countries make and should make to the development plans of the developing countries. India is the biggest single aid recipient from this country, but in view of her size she is certainly not treated over-generously. Indeed, she gets a great deal less per capita than many other countries and has used that development aid very intelligently and very successfully over the years.
    Mr. Tugendhat: Does the Minister agree that although overseas aid can play a vital and indispensable rôle in the development of poorer countries, some of the poorer countries have far greater inequalities of wealth than are to be found in the aid-giving countries and that the time has come when the countries which give generously should make clear to some of the recipient countries that they should bring about such changes in the structure of their own society and government as would enable development to take place rather faster than has been the case hitherto?
    Mr. Prentice: I would go part of the way with that, but not all the way. We are dealing with independent countries. We are not in a paternalistic situation where we can dictate to them the political and social policies they should follow. One of the considerations that we have to bear carefully in mind is that where we are providing aid it will be used effectively. We have to judge the ability of a country to make effective use of our aid as well as judging its need for it.

    Aid Programme
    Mr. Teddy Taylorasked the Minister for Overseas Development by what percentage his overseas aid programme in the current year and in 1976–77, respectively, is greater or less in real terms than the programme for 1974–75.
    Mr. Prentice: The net aid programme in 1975–76 expressed in 1974 constant prices is lower by 1·3 per cent. than in 1974–75. In cash terms, however, it shows an increase of some £100 million.

    25
    The net aid programme for 1976–77 is 1·1 per cent. higher than for 1974–75.
    Mr. Taylor: In view of those disappointing figures and of the many demands on very limited resources, will the Minister consider whether it is wise to continue giving aid to India in view of the recent political developments there? Is it fair to ask British taxpayers to give a great deal of money to help to finance the programmes of a country which is at present destroying democracy and freedom and making nonsense of the rule of law?
    Mr. Prentice: In a sense I answered that when I replied on the previous Question. I want to repeat from this Dispatch Box that it is not my business or that of Her Majesty's Government to determine the policy of other independent countries. There are within the world about 100 countries that receive aid from a number of sources, not only from Britain but from other aid donor countries and from international agencies. Many are not democracies. Some have internal practices of which we might disapprove. We have to ask two basic questions: do they need assistance, and can they make effective use of that assistance?
    Mr. Lee: Although it would not be right or practical to investigate the political purity of all the countries which are aid recipients, and although many of us who are anti-Common Market regarded the Lomé Agreement as wholly inadequate because it did not provide for the poorest nations of South-East Asia, is my right hon. Friend nevertheless aware that some of us have misgivings about what is happening in India and are bound to share in some measure the sentiments expressed rather surprisingly from the other side of the House?
    Mr. Prentice: I appreciate that my hon. Friend has reservations about what is happening in India. However, I hope he will not suggest that we should cut off aid to India or to other countries which may be pursuing policies of which hon. Members may not approve.
    As for the extension of the Lomé Agreement, it is the policy of the Government to see the aid programme of the Community extended to non-associates. We shall be arguing for that policy
    26
    within all the machinery of the Community.
    Sir D. Walker-Smith: The right hon. Gentleman has twice sought refuge in the word "effectively" or "effective use". As that word is, on the face of it, imprecise since any expenditure is bound to produce some effect and to that extent be effective, will he essay a more precise definition and in particular say whether any qualitative criterion is involved?
    Mr. Prentice: No; without giving a very long lecture I will not attempt it. I suggest to the House that a study both of the British aid programme and of the aid programmes of other donors, of the United Nations agencies, of the World Bank and other similar bodies, shows that over the years we have become very much more expert in assessing development projects. So also have the developing countries themselves in many cases become much more effective in their development projects and avoided earlier mistakes. On the whole, the experience of recent years has been more successful than was the experience 15 to 20 years ago.

    English Language Teaching
    Mr. Luceasked the Minister for Overseas Development whether the Government are making any contribution towards the teaching of the English language in the Third World.
    Mr. Prentice: Yes, Sir. We attach great importance to this. In collaboration with the British Council, my Department supports the provision of skilled manpower from this country to fill teaching, advisory and other specialist posts; arranges training for teachers and teacher trainees; and supplies books and other equipment for educational and training institutions in developing countries.
    Mr. Luce: As about one-third of the world can neither read nor write, and as English is a second language in so many underdeveloped countries, does not the Minister agree that it is a British interest to promote the teaching of English in the Third World? Therefore, will he do his best to encourage English teachers, or teachers of English, to go out to the Third World and work there, particularly at a time when there is growing unemployment in this country?
    Mr. Prentice: Yes. My original reply indicated that my predecessors have been giving priority to our programmes. I wish to continue it. The House may like to know that there are at present about 800 English teachers in specialised posts abroad involved in the teaching of English.
    Mr. MacFarquhar: Is my right hon. Friend aware that despite his encouraging reply the comparative figures for France indicate that we are not doing nearly as well as we should be and that in the year for which I have been able to obtain figures—incidentally, not from his Department—the French had over 7,300 people abroad teaching French and the comparative figure obtained from the British Council for the same year was 506 posts for the teaching of English?
    In the light of those comparative figures, will my right hon. Friend undertake a thorough review of his Department's programme for teaching English abroad and undertake to devote to this purpose a higher proportion of his admittedly limited funds?
    Mr. Prentice: I will certainly study that comparison. The House will know that there are other aid donors which provide English teachers abroad. The United States, Australia, and New Zealand all have aid programmes which involve people going abroad to teach English. This is in addition to the British programme to which I referred.

    Food Surpluses (Disposal)
    Mr. William Hamiltonasked the Minister for Overseas Development what recent discussions he has had with the EEC Commission on the disposal of surplus food to the underdeveloped and undernourished nations of the world.
    Mr. Prentice: I have had no such discussions but my right hon. Friend the Minister of Agriculture, Fisheries and Food informed the House on 24th July—[Vol. 896, c. 793.]—of the revised arrangements for the sale of EEC skimmed milk powder to developing countries. The selling price is being reduced to about half the current commercial price and the scheme has been extended to include direct sales to the Governments of developing countries. Apart from such specific measures to dispose of surplus
    28
    food, the EEC is also providing substantial quantities of food aid to the developing countries.
    Mr. Hamilton: In thanking my right hon. Friend, may I ask him to go a little further and make representations himself within the Community to make sure that these surpluses, if they are to be produced—they are indefensible in any event—will be allocated by the EEC to those who need them most? Will he take it upon himself to ensure that they go to the undernourished world rather than leave this task to his right hon. Friend the Minister of Agriculture?
    Mr. Prentice: The subject matter overlaps the food aid question. Inasmuch as we are concerned with the disposal of agricultural surpluses and the interests of the farming community in Europe, it is a matter for my right hon. Friend. To the extent that we are concerned with food aid, it is clearly a matter for me. Certainly the Government have indicated that we support the proposals of the EEC for a larger food aid programme from the Community to the developing world.
    Mr. Biggs-Davison: Does not the Minister agree that it would be a good idea if Her Majesty's Government took steps to try to bring about a co-ordinated food aid programme between the European Economic Community and the food-producing parts of the Commonwealth, such as Canada, Australia and New Zealand, which have food surpluses?
    Mr. Prentice: These matters are discussed between Governments. The Development Assistance Committee of the OECD is a forum in which donors from the non-Communist world generally come together, compare notes and exchange information on matters of this kind. I am not sure that a joint programme under a separate organisation would necessarily be helpful in this respect.
    Mr. Spearing: Concerning the skimmed milk aspect of food aid, to which my right hon. Friend referred, is he now satisfied with the arrangements made in the EEC in regard to the commercial sale of these foods, particularly for commercial baby food?
    Mr. Prentice: My hon. Friend has asked a supplementary question which

    29
    touches on the subject matter of Question No. 36, which has not been reached. This matter has been followed up since he received an answer on 16th May from my right hon. Friend who preceded me in this office. The position is that it has not been found necessary to produce a standard form of guarantee, but in the few cases where guarantees are needed against unreasonable commercial exploitation this is discussed with the recipient countries and guarantees are obtained against the sort of thing my hon. Friend has in mind.

DEVOLUTION
Mr. Dalyell: I ask for the forbearance of the House on a busy day in asking leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"what purports to be the revelation to the Scottish Press of the blueprint of the Government's White Paper on Devolution."
In one of the longest Consolidated Fund Bill debates on a single subject since the war, this House, to the irritation of many of those who had subjects lower down the list of subjects for debate, discussed devolution for seven solid hours on Thursday evening and Friday morning, ending at 4.13 a.m. with an understandably careful winding-up speech by my hon. Friend the Minister of State.
At precisely that time, and unknown to us, the printing presses of the Daily Record were churning out the details of plans, alleged to have been developed in the Cabinet Office, purporting to come from Government sources, for, among other things, a Scottish Cabinet system, for a Scottish Prime Minister, for so-called US-style decision-making congressional committees, and for an Assembly in Edinburgh, with powers of direct or indirect taxation, not to mention the assertion that the Scottish Assembly would have powers over the Scottish Development Agency and trade and industry in a year's time.
The issue is important, as described in the Daily Record, in that, if such plans were to go ahead, we should be on the road which leads inevitably to the break-up of the United Kingdom.
30
The issue is urgent, in that once such ideas become embodied in White Papers and Queen's Speeches, it is more difficult for Governments to drop them without becoming involved in the kind of morass that we had during the passage of the Parliament (No. 2) Bill on reform of the House of Lords.
The issue is definite, in that a Government whose Attorney-General takes out an injunction, rightly or wrongly, against The Times Newspapers, against Mrs. Crossman and Jonathan Cape Limited, concerning Cabinet events of 10 long years ago, has an obligation to do something about what appears to be a massive leak, thought out and designed to achieve certain political purposes, on a delicate issue which is both topical and controversial.
If a positive Government denial is not forthcoming—and I very much hope that it will be, although I understand the nature of the business in the next three days—I ask, Mr. Speaker, that some of your own time, available on Thursday might be allowed for a return to the devolution issue, in the light of the new circumstances.
The Parliamentary Secretary to the Treasury (Mr. Robert Mellish): Commenting on what my hon. Friend the Member for West Lothian (Mr. Dalyell) has said about what he read in a certain newspaper—apparently taking it for gospel that it must be true—it might be helpful if I observe that I will undertake to ensure that my right hon. Friend the Leader of the House will make a statement tomorrow.
Mr. Speaker: I am grateful to the right hon. Gentleman. I am not quite certain whether his statement pre-empts my decision. The hon. Gentleman gave me appropriate notice and he put his points clearly, as usual. They are important points. It is not for me to pronounce on the merits. No doubt the matter will be pursued in other ways—there are a number of ways open—at some time. I am afraid that the answer under Standing Order No. 9 is "No".
Later—
Mr. Donald Stewart: On a point of order, Mr. Speaker. With reference to the remarks made just now by the hon. Member for West Lothian (Mr. Dalyell)

31
about the Consolidated Fund Bill debate on devolution which pre-empted certain other debates, may I point out that none of my hon. Friends spoke for anything like the length of time for which the hon. Member himself spoke—or, for that matter, for the length of time for which the hon. Member for Fife, Central (Mr. Hamilton) spoke?
Mr. Speaker: I read that speech and the number of interruptions to it.

RIGHT HON. MEMBER FOR WALSALL, NORTH
Mr. Raphael Tuck: On a point of order, Mr. Speaker. After the Leader of the House had received on Thursday night an application from the right hon. Member for Walsall, North (Mr. Stonehouse) to appear at this House to give a personal explanation, I asked you, Mr. Speaker, on Friday morning, whether the Leader of the House had given you any intimation that he wished to make a statement about allowing me to move the motion or move it himself. Your answer, Mr. Speaker, was:
"No, I have had no such request, nor do I think that the Leader of House has had time to consider the letter. Now that I have informed the House of the letter, the matter will be considered."
Now that the Leader of the House has had the weekend in which to consider it, may I ask you whether he has given you, Mr. Speaker, any intimation that he wishes to make a statement to the House or to allow me to move that motion?
The Parliamentary Secretary to the Treasury (Mr. Robert Mellish): Further to that point of order, Mr. Speaker. In the absence of my right hon. Friend the Leader of the House I have been asked to reply. As you, Mr. Speaker, explained last Monday, it would in present circumstances require an order of the House to secure the attendance of the right hon. Member for Walsall, North. I think it is unlikely that time can be found before the recess to debate the necessary motion, and it may be better in any event to review the matter when the House resumes.
Mr. Raphael Tuck: Further to that point of order, Mr. Speaker. This is a great pity, because the right hon. Gentleman
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the Member for Walsall, North cannot now make his statement for two or three months. Is it possible for my right hon. Friend the Patronage Secretary to give an assurance that a statement will be made as soon as the House resumes?
Mr. Mellish: No.
Mr. Speaker: Order. This has nothing to do with the Chair. The right hon. Gentleman has said something. I really cannot permit the matter to be debated now. The Chair has no power of initiative in the matter; therefore, it is not a matter for the Chair. The hon. Member must pursue the matter with his right hon. Friend in other ways.
Mr. William Hamilton: Could it be made quite clear that if a statement by the right hon. Gentleman the Member for Walsall, North is to be allowed, it will have to be submitted to you first, Mr. Speaker, for your approval, and that the right hon. Gentleman cannot say whatever he likes? It is very important to get this on record, because the debate on this matter was prevented in this House on the ground that it would be prejudging court proceedings. If a statement were to be allowed, unabridged, before you saw it, Mr. Speaker, that too, presumably, would be prejudging court proceedings, so it is very important to establish that before any such statement is made it is seen by you.
Mr. Speaker: The hon. Member for Fife, Central (Mr. Hamilton), a very experienced parliamentarian, is now asking me to rule on a hypothetical matter. If the House decides to allow the right hon. Gentleman the Member for Walsall, North to make a statement, I shall have to consider my position in regard to the nature of the statement. I shall wait until the House has passed the resolution before I go any further into that matter. There are difficulties, but I have been giving it some consideration.
Mr. Lee: On a point of order, Mr. Speaker. As I understand it, there is nothing to stop a motion being moved forthwith that the right hon. Member for Walsall, North (Mr. Stonehouse) do attend the House. I propose to move that.
Mr. William Hamilton: Object.
Mr. Speaker: I think that it will be for me to say whether I can accept such a

33
motion. Objection has been taken and I must tell the hon. Member for Birmingham, Handsworth (Mr. Lee) that I cannot accept it.
Mr. Arthur Lewis: On a point of order, Mr. Speaker. As various statements have been made about the rights of the right hon. Member for Walsall, North (Mr. Stonehouse), is it not the case that if the right hon. Gentleman so desires he can now issue a written statement to every right hon. and hon. Member of this House—and, indeed, could have done so at any time during the past six months? The right hon. Gentleman could spend his time doing it now, and any right hon. or hon. Member who wished to read it could do so.
Mr. Speaker: After that useful intervention, the Clerk will now proceed to read the Orders of the Day.

ORDERS OF THE DAY
  SOCIAL SECURITY PENSIONS BILL
  Lords amendments considered.
Clause 14

  RATE OF INVALIDITY PENSION FOR PERSONS UNDER PENSIONABLE AGE
  Lords amendment: No. 1, in page 7, line 28, after "shall" insert
  "for any period of interruption of employment".
  3.41 p.m.
  The Minister of State, Department of Health and Social Security (Mr. Brian O'Malley): I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Speaker: With this, it will be convenient to discuss Lords amendment No. 2, in page 7, line 32, leave out from "year" to end of line and insert
  "which includes or included the first day of entitlement to the pension in that period".
  Mr. O'Malley: These are technical Government amendments to make it clear how invalidity pension is to be calculated.
  Question put and agreed to.
  Further Lords amendment agreed to.
  Lords amendment: No. 3, in page 7, line 32, at end insert—
  "(2) Regulations may—

  (a) provide for an invalidity pension to be payable to a pensioner who, whilst continuing to be incapacitated for normal full-time work, becomes capable of undertaking light work in circumstances which satisfy prescribed conditions;

  (b) prescribe the amount such a pensioner may earn before his pension is affected in any way; and

  (c) prescribe the effect any earnings additional to the amount referred to in paragraph (b) above will have on a pensioner's entitlement to invalidity pension."

  The Under-Secretary of State for Health and Social Security (Mr. Michael Meacher): I beg to move, That this House doth disagree with the Lords in the said amendment.
  The amendment which was moved successfully in another place was intended

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  to enable regulations to be made allowing invalidity benefit to be paid in addition to the earnings of those performing light work, whether full time or part time. At the time that the amendment was moved, it was said to have the considerable advantage that the change mooted was consistent with modern ideas of work and rehabilitation, that it was non-controversial in that it was eminently reasonable, and that it had no implications for public expenditure and therefore in no way threatened the prerogatives of this House, unlike the purpose of a previous amendment.
  If those arguments were true, I freely admit that there would be a great deal to be said for the amendment. However, I hope to be able to persuade the House that they are not.
  It would, of course, be open to the Government, as a rather simpler way round the moving of the Government's amendment, to leave this Lords amendment on the statute book and simply not use the regulating-making power that it contains or, alternatively, the regulation-making power could have been construed in such a restrictive way as to prevent the implementation of the purpose of the amendment. I hope that it will be accepted that the Government have been right to choose the rather more difficult route, which is to seek to persuade the House of the undesirability of this amendment by discussing the principle of it.
  I begin by making it clear that, although there are certain technicalities involved, the very simple principle that leads the Government to reject this amendment is that invalidity pension is dependent on the qualifying condition that the claimant is incapable of work and that to annex this to the situation that the claimant is capable of light work is to put together incompatible and mutually exclusive conditions. It is simply that basic principle which is the reason why we believe that this amendment should not be accepted.
  I am aware that the analogy was drawn in another place with the retirement pension and the earnings rule which, of course, allows someone who is in receipt of a pension also to obtain earnings to a certain level at the same time. One of the difficulties is that we speak about
  36
  an invalidity pension which appears to give a superficial analogy with the retirement pension. However, the invalidity pension would be better termed "long-term sickness benefit". That would make it clear that it is not correct to seek an analogy with retirement pension because long-term sickness benefit is incompatible with the capacity for light work.
  But, whatever view we may take about paying the old-age pension to people above a certain age, which is the effective result of abolishing the earnings rule, the payment of an automatic pension to everyone below a certain age has never been strongly advocated. Therefore, unless that view is taken, we need for people who are below pension age some means of deciding who gets the benefit and who does not. That simply is the basis of the criterion of incapacity for work.
  As the result of having such a test, if the logic of the argument is accepted, I do not think that we should make it inoperable by making modifications which are totally inconsistent with it. That is the principle on which we base the rejection of this amendment.
  However, there are one or two other relevant matters. First, it is a question of cost. It was said that this had no implications for public expenditure. This is not the case. If we take only those who are in sheltered employment and a very small proportion of those who are in open employment, it may be estimated that there are at least 20,000 disabled people who would fit into any reasonable definition of fitness only for light work. If we make the rather unrealistic assumption that each of these has only the current single person's rate of invalidity pension in addition to his earnings, the cost would be about £12 million in invalidity benefit for new beneficiaries. In Government social security terms £12 million is not an enormous sum, but it is an enormous sum in terms of the new constraints on public expenditure.
  But even that probably underestimates what are likely to be the financial consequences if we accept this amendment. If an invalidity pensioner, who now gets as a married man with a wife and two children up to £30·70 a week and who from November will get £35·50 a week, were allowed to get in addition earnings from full-time work, it is reasonable to

  37
  suppose that the man working full time in sheltered employment and getting, say, £35 a week would also expect to have invalidity benefit in addition to his earnings from light work. Therefore, there is bound to be consequential further expenditure of a not insubstantial kind. But that breaches the simple principle that only individuals incapable of work should receive invalidity pension. The man working full time in sheltered employment cannot be considered incapable of work.
  There is a third point of difficulty. I put the least emphasis on it, but it needs to be taken into account by the House. I refer to the problem of operating the benefit if the amendment were accepted. The basic evidence for invalidity benefit is the same basic evidence as is required for sickness benefit, which is a short-term counterpart of invalidity benefit, and that is a simple medical certificate from the general practitioner who has responsibility for the patient.
  I am advised that those countries which pay to sick and disabled people benefits which are designed to co-exist with their earnings almost always require four to six, or more, foolscap pages of evidence. Therefore, there can be no doubt, though I do not regard this as a decisive consideration, that if we were to change the whole character of the benefit in the way suggested by the amendment it would have a considerable impact on the administrative system, and lead to considerable extra financial costs for administrative reasons.
  So far I have been rather negative, but frank, in saying why we believe that the amendment should not be accepted. Turning to the aim of the amendment, I shall indicate the ways in which the Government believe that to a large degree we are already meeting it. I readily admit that the therapeutic earnings limit goes to only a small number of persons in specialised circumstances, but it has been extended outside the hospital system where it can be shown that the person has good cause, which normally means doctors' approval. It was raised as recently as April from £4·50 a week to £7. I accept that it is a strictly limited concept, and that the earnings figure is only one aspect, and not the most important, of measuring incapacity for work. It is not necessarily the sort of figure that
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  should go up at each uprating, but there can be difficulties if over a time it begins significantly to lose value. Therefore, I undertake—although without commitment as to the outcome—that we shall reconsider it before long and see whether a further increase would be appropriate.
  Secondly, our House of Commons Paper last September on "Social Security Provision for Chronically Sick and Disabled People" promised consultations about the whole range of questions affecting the finances of the disabled earner. I am hopeful that we shall be able to announce a new initiative in this direction before long, designed, perhaps inevitably in present circumstances, primarily to explore how best to use existing resources. We are very much aware of the difficulties of the disabled earner, and are looking for new initiatives.
  Thirdly, we are exploring the possibility of a small study of the effects of the present therapeutic earnings limit, This is a difficult area for research, but we believe that useful work on a limited scale may be possible.
  To sum up, we disagree with the Lords amendment because it envisages radical changes which could not be adopted without a great deal more thought and examination of complex conditions. Those changes would bring into invalidity benefit many people not now entitled to it, and add several millions of pounds to present costs, without any rehabilitation gain. They would involve a substantial administrative task. But the basic reason is that the amendment would completely change the whole principle of invalidity pensions, by giving it to persons who are not incapable of work, in as much as the criterion that they are capable of light work at present precisely excludes, contrary to what was said in another place, their entitlement to invalidity benefit.
  Mr. Norman Fowler: This is not the first time we have debated the rule in question. The Minister has largely repeated what the noble Lord, Lord Wells-Pestell, said in the other place when the amendment was debated and agreed to by the Lords. It has caused concern both in this House and in the Lords, and most of all among the organisations representing the interests of disabled people, such as the Disablement Income Group, which has written to many hon. Members about the matter.

  39
  We are basically concerned here with the position of the invalidity pensioner, the man or woman not of retirement age who, because of some form of incapacity, is defined as incapable of work. Many such people will not be able to work at all, but some may, and for those who struggle to do something there is the therapeutic allowance, an amount which they can earn without losing their pensions.
  There are two points to be made about the question. The first concerns the amount of the therapeutic allowance. In 1972 it was £4·50 a week. In April this year it was raised to £7. We have noted what the hon. Gentleman said about it, although, as a pledge of future action, it seemed to me to be somewhat short of a promise to do anything. Let us remember that the increase to £7 followed a Government defeat in the Lords, who voted for £13. The Government compromised with £7, and that is now the figure.
  Secondly, if the pensioner earns 1p more than his £7 he loses the entire pension. There is no tapering arrangement. The man who earns £6 a week keeps his entire invalidity pension, while the man who earns £8 loses the entire pension. This position is therefore fundamentally different from that of the pensioner who can earn £20 a week without losing anything from his pension. It is also fundamentally different from the position of the man on supplementary benefit, who at least loses on a pound-for-pound basis. We are dealing not with an earnings rule but with an earnings stop.
  That being so, in the case of the therapeutic allowance the Lords have performed another useful service. They have forced us to think again about the basis of the earnings stop rule. It is here that I find the views of the Disablement Income Group, and Peter Large in particular, crucially important. The group considers that there are two major situations in which the rule militates against the interests of the disabled. First, there is the situation of the man struck down by disability who, after a period, may be able to take up work again. It is likely that it will be a slow process, a process of rehabilitation which it is in the interest of the man and the country should be successful. It is often not possible to jump from the definition "incapable of
  40
  work" to the definition "fit for work". An employer may require that the man does only part-time work, in which the employer can develop confidence in the man and, perhaps more important, the disabled person can develop confidence in his own ability. In that kind of proposition the present rule acts as a disincentive and a discouragement to rehabilitation.
  4.0 p.m.
  The other side of the coin is the case of a person in a deteriorating condition, such as multiple sclerosis, who may struggle on and work after the point has come when he should have slowed down. This point is put forcefully by the Disablement Income Group. If there were an earnings rule it is argued that he might be encouraged to slow up sooner and it would be in his own interests to do so.
  From both points of view there is a strong case in favour of the Lords amendment. From the Government point of view it is of some relevance that this amendment does not place them under an obligation to spend extra money as at this moment. It is not obligatory upon them to take action at this point in time. In our social security debates we are coming to know it as a piece of structure legislation. It can have no effect until the Government activate it, and that will probably not be at once.
  The Government cannot object to structure legislation because they are passing and introducing in this House a large amount of structure legislation. Therefore, if the Government want to oppose this measure, so be it. What they are opposing is the principle. What we are supporting is a measure that will act in the interests of disabled people. It is supported by powerful and strong voices, such as those of the Disablement Group. We shall support the Lords amendment.
  Mr. David Price (Eastleigh): I do not wish to detain the House for more than two minutes but this is an important point. I had a great deal of sympathy with the Under-Secretary when he explained the nature of the invalidity benefit. I disagree with him on the definition of "incapacity for work". It is around this phrase that the whole argument, following through all its stages, has flowed.
  No one who supports their Lordships' amendment would disagree with the

  41
  Under-Secretary when he said that one must define fairly precisely what one means by "incapacity for work". The amendment uses the words "incapacity for normal full-time work". We would all agree that we would not wish to extend invalidity benefit, even to people who are in many cases apparently severely incapacitated. We ask the Under-Secretary to look at the situation, as my hon. Friend the Member for Sutton Coldfield (Mr. Fowler) pointed out, from the point of view of the person who is heavily incapacitated but who has a certain propensity to do some work.
  This is recognised in what the Under-Secretary has called the "therapeutic earnings allowance". It is not only therapeutic. Infinitely more important is the social integration aspect. Throughout the many debates we have had in this House and in Committee on how modern society should cope with our incapacitated colleagues we have decided that increasingly the aim should be to integrate them into society and that the cash, the aid and the care of society should not be to give them a comfortable existence in institutions and in disabled ghettos but to integrate them into the hurly-burly of ordinary life. In inviting the House to reject their Lordships' amendment, I do not believe that the Under-Secretary has addressed himself to this aspect. If we were to accept their Lordships' amendment, he would give recognition to this aspect without selling the Treasury brief.
  Anyone who has been a Minister in a spending Department knows how severe at any moment in time Treasury instructions are to Ministers not to give any public money away. I sympathise with the Under-Secretary. However, if he accepts this amendment he need not, as of today, increase public expenditure by one penny. I am sure that the right hon. Gentleman the Minister of State and architect of the Bill will recognise that much of it is for 20 years hence and that it is right that we should pass legislation that is structurally correct even if, on the phasing of it, for economic reasons we have to be greatly restrained in how quickly it can be implemented. I do not believe that the hon. Gentleman gives anything away in terms of public expenditure.
  In summing up he made cooing noises that he was sympathetic to the £7 limit. He raised it from £4·50 to £7. Let us
  42
  put the £7 into its current context. That amount of £7 is only £1 more than the basic wage increase that the Government, in their White Paper, are allowing in these counter-inflationary days for one year for the mass of the community.
  I beg the Under-Secretary to realise that those of us who believe that their Lordships are right do not expect the Government immediately to raise these allowances to large proportions. Nor do I accept the figures that he gave the House. I do not want to be unfair to him but I should like to see them written up. Possibly he would be kind enough to send me a note—I shall not press him to reply now—to explain how they are made up because, without detaining the House, I am sceptical about the assumptions on which they are based. It is not necessary to accept the view that there should be an open cheque for all handicapped workers in every sheltered employment in order to support their Lordships. The Under-Secretary was arguing as if that were the implication of their Lordships' amendment. I do not believe that it is.
  The House, in the spirit of the Government in moving the Second Reading of the Bill—that it is a structural Bill preparing for the future—would be wise to support their Lordships.
  Mr. John Hannam: I should like to support my hon. Friend the Member for Eastleigh (Mr. Price) and my hon. Friend the Member for Sutton Cold-field (Mr. Fowler) in asking the House to retain the Lords amendment. I have the feeling that the Under-Secretary was a little hesitant in giving his support to his brief. From reading the Lords amendment we can see that all the powers are given to the Government to control, to any extent they wish, the degree of expenditure which the Government may wish to make.
  In the debate on 12th March on the Social Security Benefits Bill, I and other hon. Members endeavoured to move an amendment to relieve disabled people of this harsh wages stop. We had a limit then of £4·50 for therapeutic earnings, and this was raised, during that debate, to £7 a week. We would all welcome a hint that this might be raised again some time in the future. In that event, the Government would not accept the principle that a definition of light work could

  43
  be arrived at so as to allow invalids who are incapable of normal full-time work but can perform light duties on one or two days a week to receive their invalidity pension at a reduced level. We suggested then that an earnings rule be applied in stages from £13 to £17 with a ceiling of the amount that could be deducted from the pension. The powers to propose that ceiling are in this Lords amendment. We ask that this should be introduced rather than having a 100 per cent. cut-off, which would occur if a disabled person earned even 1p or 2p more than £7 a week.
  During that debate on 12th March 1 and other hon. Members presented several cases of people who were suffering from multiple sclerosis and other disabilities who had performed light secretarial or research work for a few hours and found themselves losing their entire invalidity allowance of £27 or £30 a week purely because their earnings had totalled £8 a week over that period. I can understand the Government's fears that there would be a breach of their rather precious definition of "total incapacity for work". However, the Lords amendment clearly gives the power to the Government to regulate and prescribe the limit of earnings and the amount of invalidity pension which would be affected.
  I hope that we can all agree that the time has come for some intermediate definition of "partial" incapacity, just as is provided in the constant attendance allowance, which allows for attendance by "day or night" to be a qualification for the allowance. There can be no doubt that this rule is working very harshly. It affects those whom we would like to see brought back into some degree of integration with a normal working life and who would like to relieve the State of financial responsibility which they are placing upon the State.
  It was stated in another place by Lord Crawshaw, who moved the amendment there, that if we were to help disabled people to get back into normal employment we would be saving the Exchequer money by ending supplementary benefit payments and by taking these people from the top rates of pensions. Apparently Lord Wells-Pestell, the Minister, had informed Lord Crawshaw by letter that the Government would prefer to handle
  44
  this problem by the use of regulations. This is just what the amendment seeks to do. There is no charge on the hard-pressed Treasury unless the Government introduce such a charge. Everything is left in the Minister's hands as to what improvements can be prescribed by these regulations, and when. Surely if workers at Jaguar can work four days a week and draw unemployment benefit on the fifth day, there is an indefensible case for a disabled person to work one day a week without losing his pension.
  Speaking as secretary of the all-party Diseablement Group and as a member of DIG, I regret that the Secretary of State has asked the House to reject the amendment. I hope the House will show some regard for the desires of chronically disabled people to integrate more fully into normal life, and I hope that the Government recognise that in this amendment they have power to prescribe by regulations the amount to be allowed.
  Mr. Robert Boscawen: I wish to express my disappointment at the Government's failure to accept the Lords amendment. I believe it is as widely and as flexibly drawn as it possibly can be, to enable the Government to bring in the proper regulations to suit the situation.
  In an earlier stage of the Bill I said that the Government should find a way of mitigating the effect of the earnings stop. It does not affect many people. The Under-Secretary of State said that it affected only a very small number of people, and I think that, although the number is small, this stop is a very important factor in their lives. Having experienced some of the effects of trying to get back to work after disablement, I know the effort and the strength of character required in order to do so.
  I am therefore disappointed that, although the Government appear to have accepted the general principle behind the amendment, they are not prepared to do anything about it at this stage. I cannot understand why they have not studied the effects of the therapeutic earnings limit. This matter has been bandied about for some time. We have discussed it and we have expressed our strong feelings about it. The Department ought to study it and let us have more information about the effect of the therapeutic earnings limit as soon as possible.

  45
  If there is a Division, I shall support my hon. Friends, because I am fed up about the whole matter.
  4.15 p.m.
  Mr. Tony Newton: I rise not as a frequent contributor to social security debates but as a fairly regular contributor to financial debates and frequently on the subject of assistance to the disabled and other similar matters.
  I support the amendment and what my hon. Friends have said, not least because, having listened to the Under-Secretary, I was not at all sure whether he himself was convinced by his own argument. If he was, I can only say that he did not succeed in convincing me, and, indeed, I hope he has not succeeded in convincing himself either.
  The Under-Secretary touched on an administrative argument, and I say this to him as fairly as I can. He touched on the argument lightly, so much so that it did not seem to me to be worth putting. He referred to the number of sheets of paper which might have to be filled in. There are many problems which have to be dealt with by filling in sheets of paper, for instance in connection with our complicated tax and social security system. If that argument had any real force we would have to sweep away a large part of our administrative system and throw it out of the window.
  As to the question of cost, my hon. Friends have disposed of that with some ease. The amendment does not automatically involve any extra cost. It is clear from the amount of scope involved in regulation making in the amendment that the cost could be determined largely by the Government. In addition, we are all entitled to be very wary of figures for costs which are given in this kind of argument because so often when they are investigated we find that they have been worked out on a simplistic basis and that no account has been taken of the gain which would accrue to the gross domestic product as a result of the extra employment created or the extra tax revenue.
  I am sorry that the Chancellor popped into the Chamber as though he were about to announce some great concession, and then popped out again. I should have liked to say this to him. It is high time that the Department of Health and Social
  46
  Security and the Treasury got together on some of these matters. Half the time their figures do not add up, and there is every sign that the people in one Department have not talked to people in the other Department. They come along with crude figures relating to the social security system, and we never get a proper sophisticated analysis of the effect of the measure. We do not need to take seriously the argument about the cost of this amendment.
  Then we come to the ground on which the Minister based most of his case, the ground of principle. This ground disappears as soon as one contemplates the existence of the therapeutic earnings allowance. Either there is a principle that this is not paid to anybody who works at all, or there is not. By any dictionary definition of the word "principle", that argument falls straight away. Even if we accepted that there was a principle which the Minister was entitled to defend, I would say that I do not agree with a principle whereby a person who works at all loses the whole of the benefit.
  The social effect of this situation, as was pointed out by my hon. Friend the Member for Eastleigh (Mr. Price), can be very damaging indeed. I could hardly believe my ears when I thought I heard the Minister say that if the amendment were accepted, these rather theoretical costs that would arise would have no rehabilitative gain. I think I have got his words right—"no rehabilitative gain". One has only to talk to people in the Disablement Income Group or to read some of the things written by people concerned with these problems to know that their considered view is that this rule is actively preventing people from going back to work who would otherwise do so. It is causing them to become totally dependent and to make no real effort to get back into an ordinary working life. If we can do anything to mitigate that effect, it seems to me, contrary to what the Minister said, that there is a clear rehabilitative gain.
  No doubt other hon. Members have also received comments from Mr. Peter Large, who has passed on a letter from Miss Diana Irish, the General Secretary of the Spinal Injuries Association. Mr. Large points out that a disabled man with a wife and two small children could be receiving an invalidity pension and

  47
  allowance totalling £30·70 a week—quite a substantial sum. If that man earns more than £7 a week he loses it all. To earn £8 a week he has to sacrifice £30·70.
  Who in his right mind, when he becomes capable of earning £7 a week but not a great deal more, would bother to do so? The very altruistic might, and so might those who are very keen to get back to work. But if a person was only marginally interested or was in a "don't care" frame of mind, which is quite possible in these difficult circumstances, why should he bother to earn £12 or £15 a week if he will lose £30 a week? It is simple, straightforward madness that we should have a system that imposes this choice on him.
  Diane Irish says in her letter that it is quite apparent that the current system,
  "does take away from many disabled men and women any incentive to find any form of work".
  She particularly expresses her concern at the fact that younger disabled people, in their late teens for example, could quickly become accustomed to living on a fairly substantial sum of public money. There is little point in them making an effort to earn and to become independent because the system encourages them to turn in on themselves and not to seek ways of overcoming their difficulty and disability in order to play a part in society, as many, if they were given some slight encouragement, would wish to do.
  These are important points that cannot be dismissed. One can see these situations occurring in families. They can sink into a closed, sheltered, cloistered life. There is no great purpose in trying to take part as much as possible in normal life because of these grave financial disincentives.
  The Minister said the Government were looking for new initiatives to help the disabled, but he is now rejecting a new initiative. Why not accept it and see what he can do to make it work? I accept that this is a difficult problem, but if the Government accepted the amendment, they would not have to do anything. It would act as a prod and an embarrassment to them on the statute book and would be a constant reminder to get on with the initiatives the Minister was talking about as a matter of urgency. I can see every argument for the amendment
  48
  and I cannot see the harm which the Minister suggested it would cause. It would at least be a step in the direction of pressing the Minister and the Department to get on with the job of doing something about this difficult problem on which action is necessary.
  Mr. Meacher: One of the factors in the debate has been that it would be perfectly harmless—this was referred to by the hon. Member for Braintree (Mr. Newton)—if the Government accepted the regulation-making powers in the amendment because they would not involve any immediate cost implications. To accept any Lords amendment purely because it was permissive when there was no intention by the Government to activate it, for the reasons of principle I have given, would be deceptive and very far from the honourable course. I dismiss the argument that we should accept the amendment because it has no immediate implications. We have to consider the issue of principle and whether it is appropriate that we should proceed in this way.
  Mr. Norman Fowler: I assume the Minister would not disagree that every week his Department is passing structure legislation, which will not come into effect for some years. How does he distinguish between this legislation and the matter we are now discussing?
  Mr. Meacher: Very simply. The structure legislation we pass is legislation with a structure that is appropriate, whereas this structure legislation, if it can be called that, is not appropriate for the reasons of principle I have already given.
  I accept that there are issues about how we can provide further assistance, particularly for the long-term disabled, but this amendment is concerned with whether they should receive an invalidity pension on top of their earnings. An invalidity pension is given because a person is incapable of working, and it would be inappropriate for it to be added on top of earnings.
  The hon. Member for Sutton Coldfield (Mr. Fowler) put two arguments to which I should reply. He said that if we accepted the amendment it would help the person who was slowly working his way back and that it was not possible to move quickly from long-term sickness to

  49
  full employment. I accept that there is a period in which a person might be moving from one state to another, but the logic of the hon. Member's argument would presumably mean that if an able-bodied man was off work sick and gradually recovering, he would be entitled to some sickness benefit while performing certain light work before taking up his normal work again. That is a reductio ad absurdum, but we do not provide any such transitional benefit and it would be inappropriate to extend that concept into long-term benefits. They are basically the same kind of benefit.
  The hon. Member's other argument concerned a person who might, for example, be suffering from disseminated sclerosis and might be able to retire from work more gradually. I accept that there is an issue here, and it is a matter on which such a person needs to be assisted. But if we accept the amendment, the hon. Gentleman has not answered the problem that it could apply to very many more people than those he is rightly trying to help. It would, for example, lead to pressure, which would be very difficult to resist, in the case of those people in full-time sheltered employment who are capable of only light work, but who in no sense could be construed as being in the same category as the long-term disabled. It would be very difficult to exclude them.
  I have made clear that the Government intend to do more. The hon. Member for Sutton Coldfield made fun of my remarks, suggesting that they did not sound as if we were going to do anything, but that is a little rum coming from him. His party is pursuing an economic policy whose object, as far as we can see, is to cut public expenditure very much more than even this Government are considering. It ill becomes him to suggest that we are not considering ways, within very tight financial constraints, of moving forward. I did not want to mention this, but the hon. Gentleman tempted me. Since we came to office we have spent an extra £1,000 million in real benefits. It is unfair to say that we are not looking for ways in which we can assist these people within our very tight financial constraints.
  Mr. Norman Fowler: Will the hon. Gentleman repeat his promise and undertaking?
  4.30 p.m.
  Mr. Meacher: Yes. I mentioned three initiatives which we were prepared to consider. The first was whether the therapeutic earnings limit, which was raised as recently as April from £4·50 to £7, should be further increased. I am not making a commitment; I am merely saying that my right hon. Friend will consider this as a priority. However, I believe that this is an important area in which we can perhaps increasingly help the long-term disabled.
  One of the difficulties with the therapeutic earnings limit is that there is a straight cut-off; there is no taper. It is appropriate to consider without commitment whether there should be a taper. There are difficulties about administrative rules because some people are always on the wrong side of them. It would be proper to consider whether there should be a phased decrease in the benefit.
  Mr. David Price: The disabled do not fall into clear categories and, therefore, we can all agree on the principle of a taper. We have it in the earnings rule for the old. Why not have it for the disabled?
  Mr. Meacher: I am trying to make it clear, although plainly I am having difficulty in doing so, that there is an in-between state. Some people clearly are much less disabled than others and they may be capable of light work. I accept that such people need to be assisted. Invalidity benefit is conceptually not the most appropriate benefit with which to operate. I am saying no more than that. However, I have to rely on the belief of hon. Members opposite in my sincerity when I say that we shall consider other means of positively meeting the point.
  The hon. Member for Eastleigh (Mr. Price) spoke in terms of social integration. That is a principle which we and the Opposition entirely support. We want to bring the disabled much more closely into the mainstream of society. But turning invalidity benefit upside down is not the way to integrate the disabled into society—by, for example, comparing people on that benefit with £35·50 a week after November with people in sheltered employment. That is not the proper way to proceed.
  The hon. Gentleman indicated that he believed that what is in the amendment

  51
  is structurally correct. I have indicated that in our view it is not. It is far more appropriate to consider other ways of solving the problem, particularly that with regard to the therapeutic earnings limit. The hon. Gentleman challenged me on the figures. I am prepared to write to him if he is still mystified after hearing what I have to say.
  There is a substantial number of disabled people who are capable of light work. They are in sheltered employment, or in open employment or, in some cases, are receiving the social security benefits which are paid to people who are unemployed. The number depends on the precision of the definition, but there are well over 13,000 disabled people in sheltered employment, 60,000 unemployed registered disabled people and ½ million to 1 million disabled people in open employment. I have therefore very modestly taken only those in sheltered employment and only a small proportion of those in open employment in suggesting that the number involved is 20,000. On the assumption that they were merely receiving a current single person's invalidity pension on top of earnings—and that is bound to be an underestimate in many cases- the cost of the amendment would be £12 million.
  The hon. Member for Braintree and others who have pooh-poohed the public expenditure implications are quite wrong. Clearly there are public expenditure implications. They may not be overriding implications, but they cannot be ignored.
  The hon. Member for Exeter (Mr. Hannam) referred to a saving of public expenditure. There may be savings in supplementary benefits in some cases, but there are many people in receipt of invalidity pension at a level which will not lead to savings in supplementary benefits. As against his contention, one has to take into account what I would
  regard as the minimum implications of public expenditure which I have mentioned.
  We are not unmindful of the needs of this group of people, but because invalidity benefit is not the most appropriate benefit by which to proceed, I hope that on consideration the Opposition will not press the amendment to a Division. The amendment would totally breach the principle of invalidity benefit whereby we would be forced, or the Opposition would be forced if they were to succeed us, to provide substantial sums of public expenditure for groups which are not the main object of the amendment but would be bound to be included in it.
  That is not the best way for social policy to proceed. I hope that hon. Members opposite will accept my statement that we intend positively, and I hope soon, to come forward with further initiatives which will be relevant to the group of people we are discussing.
  Mr. Norman Fowler: The more I listened to the argument of the Under-Secretary of State, the more I found it difficult to understand. He has said that the Government are considering raising the therapeutic allowance and that they are considering the introduction of a tapering arrangement. Therefore, I do not understand why he cannot accept the amendment. I am unconvinced by the hon. Gentleman's speech. It is significant that he has not been supported by one hon. Member. Not one voice, apart from his own, has been raised in favour of the case he has put forward. Therefore, we shall press the matter to a vote.
  Question put, That this House doth disagree with the Lords in the said amendment:—
  The House divided: Ayes 247, Noes 222.

  Division No. 317.]

  AYES

  [4.38 p.m.

  Allaun, Frank

  Benn, Rt Hon Anthony Wedgwood

  Brown, Hugh D. (Provan)

  Anderson, Donald

  Bennett, Andrew (Stockport N)

  Buchan, Norman

  Archer, Peter

  Bidwell, Sydney

  Buchanan, Richard

  Armstrong, Ernest

  Bishop, E. S.

  Callaghan, Jim (Middleton & P)

  Atkins, Ronald (Preston N)

  Blenkinsop, Arthur

  Campbell, Ian

  Atkinson, Norman

  Booth, Albert

  Canavan, Dennis

  Bagier, Gordon A. T.

  Boothroyd, Miss Betty

  Cant, R. B.

  Barnett, Guy (Greenwich)

  Bottomley, Rt Hon Arthur

  Carmichael, Neil

  Barnett, Rt Hon Joel (Heywood)

  Boyden, James (Bish Auck)

  Cartwright, John

  Bates, Alt

  Bradley, Tom

  Castle, Rt Hon Barbara

  Clemitson, Ivor

  Hunter, Adam

  Prescott, John

  Cocks, Michael (Bristol S)

  Irvine, Rt Hon Sir A. (Edge Hill)

  Price, C. (Lewisham W)

  Cohen, Stanley

  Irving, Rt Hon S. (Dartford)

  Price, William (Rugby)

  Coleman, Donald

  Jackson, Colin (Brighouse)

  Radice, Giles

  Colquhoun, Mrs Maureen

  Jackson, Miss Margaret (Lincoln)

  Richardson, Miss Jo

  Concannon, J. D.

  Janner, Greville

  Roberts, Albert (Normanton)

  Conlan, Bernard

  Jay, Rt Hon Douglas

  Roberts, Gwilym (Cannock)

  Cook, Robin F. (Edin C)

  Jenkins, Hugh (Putney)

  Robertson, John (Paisley)

  Corbett, Robin

  Johnson, James (Hull West)

  Rodgers, George (Chorley)

  Cox, Thomas (Tooting)

  Johnson, Walter (Derby S)

  Rooker, J. W.

  Craigen, J. M. (Maryhill)

  Jones, Dan (Burnley)

  Roper, John

  Crawshaw, Richard

  Judd, Frank

  Sandelson, Neville

  Crosland, Rt Hon Anthony

  Kaufman, Gerald

  Selby, Harry

  Cunningham, G. (Islington S)

  Kelley, Richard

  Shaw, Arnold (Ilford South)

  Cunningham, Dr J. (Whiteh)

  Kerr, Russell

  Sheldon, Robert (Ashton-u-Lyne)

  Dalyell, Tam

  Kilroy-Silk, Robert

  Shore, Rt Hon Peter

  Davidson, Arthur

  Lamborn, Harry

  Short, Rt Hon E. (Newcastle C)

  Davies, Bryan (Enfield N)

  Lamond, James

  Short, Mrs Renée (Wolv NE)

  Davies, Denzil (Llanelli)

  Latham, Arthur (Paddington)

  Silkin, Rt Hon John (Deptford)

  Davis, Clinton (Hackney C)

  Lee, John

  Silkin, Rt Hon S. C. (Dulwich)

  Deakins, Eric

  Lestor, Miss Joan (Eton & Slough)

  Sillars, James

  Dean, Joseph (Leeds West)

  Lever, Rt Hon Harold

  Silverman, Julius

  Delargy, Hugh

  Lewis, Arthur (Newham N)

  Skinner, Dennis

  Dell, Rt Hon Edmund

  Lewis, Ron (Carlisle)

  Small, William

  Dempsey, James

  Lipton, Marcus

  Smith, John (N Lanarkshire)

  Dormand, J. D.

  Loyden, Eddie

  Snape, Peter

  Douglas-Mann, Bruce

  Luard, Evan

  Spearing, Nigel

  Duffy, A. E. P.

  Lyon, Alexander (York)

  Spriggs, Leslie

  Dunn, James A.

  Lyons, Edward (Bradford W)

  Stallard, A. W.

  Dunwoody, Mrs Gwyneth

  McCartney, Hugh

  Stewart, Rt Hon M. (Fulham)

  Eadie, Alex

  MacFarquhar, Roderick

  Stoddart, David

  Edge, Geoff

  Mackenzie, Gregor

  Stott, Roger

  Edwards, Robert (Wolv SE)

  Maclennan, Robert

  Strang, Gavin

  Ellis, Tom (Wrexham)

  McMillan, Tom (Glasgow C)

  Strauss, Rt Hon G. R.

  English, Michael

  Madden, Max

  Summerskill, Hon Dr Shirley

  Ennals, David

  Magee, Bryan

  Swain, Thomas

  Evans, Fred (Caerphilly)

  Mahon Simon

  Taylor, Mrs Ann (Bolton W)

  Evans, Ioan (Aberdare)

  Mallalieu J. P. W.

  Thomas, Ron (Bristol NW)

  Evans, John (Newton)

  Marks, Kenneth

  Tinn, James

  Ewing, Harry (Stirling)

  Marquand David

  Tomlinson, John

  Faulds, Andrew

  Marshall, Dr Edmund (Goole)

  Tomney, Frank

  Fitch, Alan (Wigan)

  Mason, Rt Hon Roy

  Torney, Tom

  Flannery, Martin

  Maynard, Miss Joan

  Tuck, Raphael

  Fletcher, Ted (Darlington)

  Meacher, Michael

  Urwin, T. W.

  Foot, Rt Hon Michael

  Mellish, Rt Hon Robert

  Varley, Rt Hon Eric G.

  Forrester, John

  Mendelson, John

  Wainwright, Edwin (Dearne V)

  Fowler, Gerald (The Wrekin)

  Mikardo, Ian

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

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

  Millan, Bruce

  Walker, Harold (Doncaster)

  Garrett, John (Norwich S)

  Miller, Dr M. S. (E Kilbride)

  Walker, Terry (Kingswood)

  George, Bruce

  Miller, Mrs Millie (Ilford N)

  Ward, Michael

  Gilbert, Dr John

  Mitchell, R. C. (Soton, lichen)

  Watkins, David

  Ginsburg, David

  Molloy, William

  Watkinson, John

  Gould, Bryan

  Moonman, Eric

  Weitzman, David

  Gourlay, Harry

  Morris, Charles R. (Openshaw)

  Wellbeloved, James

  Graham, Ted

  Moyle, Roland

  White, Frank R. (Bury)

  Grant, George (Morpeth)

  Mulley, Rt Hon Frederick

  White, James (Pollok)

  Grocott, Bruce

  Murray, Rt Hon Ronald King

  Whitehead, Phillip

  Hamilton, W. W. (Central Fife)

  Newens Stanley

  Whitlock, William

  Hardy, Peter

  Ogden, Eric

  Willey, Rt Hon Frederick

  Harper, Joseph

  O'Halloran, Michael

  Williams, Alan (Swansea W)

  Harrison, Walter (Wakefield)

  O'Malley, Rt Hon Brian

  Williams, Alan Lee (Hornch'ch)

  Hatton, Frank

  Orbach, Maurice

  Williams, Rt Hon Shirley (Hertford)

  Hayman, Mrs Helene

  Orme Rt Hon Stanley

  Williams, W. T. (Warrington)

  Healey, Rt Hon Denis

  Ovenden, John

  Wilson, Alexander (Hamilton)

  Heffer, Eric S.

  Owen, Dr David

  Wilson, William (Coventry SE)

  Hooley, Frank

  Padley, Walter

  Wise, Mrs Audrey

  Horam, John

  Palmer, Arthur

  Woodall, Alec

  Howell, Dennis (B'ham, Sm H)

  Park, George

  Wrigglesworth, Ian

  Hoyle, Doug (Nelson)

  Parry, Robert

  Young, David (Bolton E)

  Huckfield, Les

  Pavitt, Laurie

  Hughes, Rt Hon C. (Anglesey)

  Peart, Rt Hon Fred

  TELLERS FOR THE AYES:

  Hughes, Mark (Durham)

  Pendry, Tom

  Mr. John Ellis and

  Hughes, Robert (Aberdeen N)

  Perry, Ernest

  Mr. James Hamilton.

  Hughes, Roy (Newport)

  Phipps, Dr Colin

  NOES

  Adley, Robert

  Berry, Hon Anthony

  Bowden, A. (Brighton, Kemptown)

  Aitken, Jonathan

  Biffen, John

  Boyson, Dr Rhodes (Brent)

  Arnold, Tom

  Biggs-Davison, John

  Braine, Sir Bernard

  Atkins, Rt Hon H. (Spelthorne)

  Blaker, Peter

  Brittan, Leon

  Bain, Mrs Margaret

  Body, Richard

  Brotherton, Michael

  Banks, Robert

  Boscawen, Hon Robert

  Brown, Sir Edward (Bath)

  Bell, Ronald

  Bottomley, Peter

  Buchanan-Smith, Alick

  54

  55

  Buck, Antony

  James, David

  Rathbone, Tim

  Budgen, Nick

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

  Rees, Peter (Dover & Deal)

  Bulmer, Esmond

  Jessel, Toby

  Rees-Davies, W. R.

  Carlisle, Mark

  Johnson Smith, G. (E Grinstead)

  Renton, Rt Hon Sir D. (Hunts)

  Carr, Rt Hon Robert

  Johnston, Russell (Inverness)

  Renton, Tim (Mid-Sussex)

  Carson, John

  Jones, Arthur (Daventry)

  Rhys Williams, Sir Brandon

  Chalker, Mrs Lynda

  Jopling, Michael

  Ridley, Hon Nicholas

  Channon, Paul

  Kimball, Marcus

  Ridsdale, Julian

  Clark, Alan (Plymouth, Sutton)

  King, Evelyn (South Dorset)

  Rifkind, Malcolm

  Clark, William (Croydon S)

  King, Tom (Bridgwater)

  Rippon, Rt Hon Geoffrey

  Cockcroft, John

  Kirk, Peter

  Roberts, Wyn (Conway)

  Cooke, Robert (Bristol W)

  Knight, Mrs Jill

  Rodgers, Sir John (Sevenoaks)

  Cope, John

  Knox, David

  Rossi, Hugh (Hornsey)

  Corrie, John

  Lamont, Norman

  Rost, Peter (SE Derbyshire)

  Costain, A. P.

  Lane, David

  Royle, Sir Anthony

  Critchley, Julian

  Langford-Holt, Sir John

  Sainsbury, Tim

  Davies, Rt Hon J. (Knutsford)

  Lawrence, Ivan

  St. John-Stevas, Norman

  Dean, Paul (N. Somerset)

  Lawson, Nigel

  Scott, Nicholas

  Douglas-Hamilton, Lord James

  Lester, Jim (Beeston)

  Shaw, Giles (Pudsey)

  Drayson, Burnaby

  Lewis, Kenneth (Rutland)

  Shaw, Michael (Scarborough)

  Durant, Tony

  Luce, Richard

  Shelton, William (Streatham)

  Dykes, Hugh

  McAdden, Sir Stephen

  Shepherd, Colin

  Eden, Rt Hon Sir John

  McCrindle, Robert

  Silvester, Fred

  Edwards, Nicholas (Pembroke)

  Macfarlane, Neil

  Sims, Roger

  Eyre, Reginald

  MacGregor, John

  Sinclair, Sir George

  Fairbairn, Nicholas

  McNair-Wilson, M. (Newbury)

  Skeet, T. H. H.

  Fairgrieve, Russell

  McNair-Wilson, P. (New Forest)

  Smith, Cyril (Rochdale)

  Finsberg, Geoffrey

  Madel, David

  Smith, Dudley (Warwick)

  Fletcher, Alex (Edinburgh N)

  Marten, Neil

  Speed, Keith

  Fletcher-Cooke, Charles

  Mates, Michael

  Spence, John

  Fookes, Miss Janet

  Mather, Carol

  Spicer, Michael (S Worcester)

  Fowler, Norman (Sutton C'f'd)

  Maude, Angus

  Sproat, Iain

  Fox, Marcus

  Maudling, Rt Hon Reginald

  Stainton, Keith

  Fry, Peter

  Mawby, Ray

  Stanbrook, Ivor

  Gardiner, George (Reigate)

  Maxwell-Hyslop, Robin

  Stanley, John

  Gilmour, Rt Hon Ian (Chesham)

  Mayhew, Patrick

  Steel, David (Roxburgh)

  Gilmour, Sir John (East Fife)

  Meyer, Sir Anthony

  Steen, Anthony (Wavertree)

  Godber, Rt Hon Joseph

  Miller, Hal (Bromsgrove)

  Stewart, Donald (Western Isles)

  Goodhew, Victor

  Mills peter

  Stokes, John

  Goodlad, Alastair

  Miscampbell, Norman

  Stradling Thomas, J.

  Gorst, John

  Mitchell David (Basingstoke)

  Taylor, R. (Croydon NW)

  Gow, Ian (Eastbourne)

  Moate Roger

  Taylor, Teddy (Cathcart)

  Gower, Sir Raymond (Barry)

  Monro, Hector

  Tebbit, Norman

  Grant, Anthony (Harrow C)

  Montgomery, Fergus

  Temple-Morris, Peter

  Gray, Hamish

  Moore, John (Croydon C)

  Thatcher, Rt Hon Margaret

  Grist, Ian

  Morris, Michael (Northampton S)

  Thomas, Rt Hon p. (Hendon S)

  Grylls, Michael

  Morrison, Charles (Devizes)

  Thorpe, Rt Hon Jeremy (N Devon)

  Hall, Sir John

  Morrison, Hon Peter (Chester)

  Townsend, Cyril D.

  Hall-Davis, A. G. F.

  Mudd, David

  Tugendhat, Christopher

  Hamilton, Michael (Salisbury)

  Neave, Airey

  van Straubenzee, W. R.

  Hampson, Dr Keith

  Nelson, Anthony

  Viggers, Peter

  Hannam, John

  Neubert, Michael

  Wainwright, Richard (Colne V)

  Harrison, Col Sir Harwood (Eye)

  Newton, Tony

  Wakeham, John

  Hastings, Stephen

  Normanton, Tom

  Walker-Smith, Rt Hon Sir Derek

  Havers, Sir Michael

  Nott, John

  Wall, Patrick

  Hawkins, Paul

  Oppenheim, Mrs Sally

  Warren, Kenneth

  Hayhoe, Barney

  Page, John (Harrow West)

  Weatherill, Bernard

  Heseltine, Michael

  Page, Rt Hon P. Graham (Crosby)

  Wells, John

  Holland, Philip

  Paisley, Rev Ian

  Welsh, Andrew

  Hordern, Peter

  Parkinson, Cecil

  Whitelaw, Rt Hon William

  Howe, Rt Hon Sir Geoffrey

  Pattie, Geoffrey

  Wiggin, Jerry

  Howell, David (Guildford)

  Penhaligon, David

  Winterton, Nicholas

  Howell, Ralph (North Norfolk)

  Percival, Ian

  Wood, Rt Hon Richard

  Hunt, John

  Peyton, Rt Hon John

  Young, Sir G. (Ealing, Acton)

  Hurd, Douglas

  Pink, R. Bonner

  Hutchison, Michael Clark

  Price, David (Eastleigh)

  TELLERS FOR THE NOES:

  Irvine, Bryant Godman (Rye)

  Prior, Rt Hon James

  Mr. Michael Roberts and

  Irving, Charles (Cheltenham)

  Pym, Rt Hon Francis

  Mr. W. Benyon.

  Raison, Timothy

  Question accordingly agreed to.

Clause 22

  MOBILITY ALLOWANCE
  Lords amendment: No. 4, in page 14, line 3, at end insert
  "being such an appliance as is primarily designed to afford a means of personal and independent locomotion out of doors."
  Mr. Meacher: I beg to move, That this House doth agree with the Lords in the said amendment.
  I take it that the amendment will be entirely non-controversial and I shall, therefore, be brief. It concerns Section 37A(5)(b), which was introduced into the Social Security Act 1975 by Clause 22.

  57
  It enables regulations to be made prescribing cases in which the mobility allowance is not to be payable, or is to be payable at a reduced rate, while the person has the use:
  "of any prescribed description of appliance supplied under enactments relating to the National Health Service".
  The Government had given assurances that there was no intention of using this power at present and that it was required only as a reserve power in case an expensive outdoor mobility appliance became available for use in the future. The Government had in mind the possible future issue of a suitable occupant-controlled electrically-propelled outdoor vehicle. Fears were expressed that the power was so wide that virtually any appliance such as a walking frame, crutches or even a Possum typewriter would be covered and that a future Government would have to reduce the mobility allowance for any of those items.
  An amendment tabled on Report in another place was accepted by the Government to make clear that the reduction of the mobility allowance can be applied only if the appliance concerned is designed primarily for use out of doors and is an aid to personal and independent locomotion. That is accepted by the Government, and I hope that it will be acceptable to the House.
  Question put and agreed to.

Clause 24

  POWER TO MODIFY PROVISIONS ABOUT GRADUATED RETIREMENT BENEFIT
  Lords amendment: No. 5, in page 16, line 10, leave out
  "Schedule 26 to the Social Security Act 1973 or"
  Mr. O'Malley: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker (Mr. George Thomas): With this we are taking Lords amendments Nos. 39, 41, 62, 63, 67, 68, 70, 71, 72 and 73. I draw attention to the fact that privilege is involved in Amendment No. 71.
  Mr. O'Malley: The amendments are all technical amendments to put right omissions and correct references in the Bill.
  Mr. R. A. McCrindle: We have no objection to all the amendments being taken together. It appears that the Minister is on fairly good ground in saying that they are all technical amendments for clarification.
  Question put and agreed to.

Clause 28

  REVIEW AND ALTERATION OF CONTRACTED-OUT RATES OF CLASS 1 CONTRIBUTIONS
  Lords amendment: No. 6, in page 18, line 44, leave out "fourth" and insert "third".
  Mr. O'Malley: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker: With this we are taking Lords amendments Nos. 7 and 8.
  Mr. O'Malley: The amendments were introduced to fulfil an undertaking given by the Government on Report in this House to afford at least 12 months' notice of any changes in the contribution percentages. In practice it is envisaged that there will be about 18 months' notice, and the first report will be made as soon as may be after the third anniversary of the clause's coming into effect instead of after the fourth anniversary, to allow for the longer period of notice.
  Question put and agreed to.
  Subsequent Lords amendments agreed to.

Clause 31

  CONTRACTING-OUT CERTIFICATES
  Lords amendment: No. 9, in page 21, line 35, leave out "for negotiating purposes" and insert:
  "to any extent for the purpose of collective bargaining".
  Mr. Meacher: I beg to move, That this House doth agree with the Lords in the said amendment.
  This is a purely technical amendment which the Government have introduced to bring the wording of the clause into line with the Employment Protection Bill as it has been amended.
  Question put and agreed to.

Clause 33

  REQUISITE BENEFIT FOR EARNER
  Lords amendment: No. 10, in page 24, line 9, leave out subsection (5) and insert:
  "(5) Equivalent pension benefits for the purposes of the former legislation are not to be regarded as constituting any part of the earner's guaranteed minimum pension.
  (6) The benefits referred to in subsection (5) above are any to which the earner may be immediately or prospectively entitled in respect of a period of employment which—

  (a) was for him non-participating employment under that legislation; and

  (b) was not on its termination the subject of any payment in lieu of contributions;

  but subsection (5) excludes so much only of those benefits as (and no more than) had to be provided in order that the employment should for that period be treated as non-participating.
  (7) In this section "the former legislation" means Part III of the National Insurance Act 1965 and the previous corresponding enactments."
  Mr. O'Malley: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker: With this we are taking Lords amendments Nos. 20 and 21.
  Mr. O'Malley: The Government introduced these technical amendments in another place to make clear that equivalent pension benefits constituted only the minimum benefits which had to be provided for contracting out under the National Insurance Act 1965.
  Question put and agreed to.

Clause 34

  ANNUAL RATE OF EARNER'S PENSION
  Lords amendment: No. 11, in page 24, line 30, at end insert:
  "(3A) The earner's pension need not be in accordance with subsection (2) above in case of his service in the relevant employment being terminated before he attains the scheme's normal pension age and when—

  (a) he has completed in that employment less than five years' qualifying service for the purposes of Schedule 16 to the Social Security Act 1973 (preservation); or

  (b) he is under the age of 26 on termination of that employment"

  Mr. O'Malley: I beg to move, That this House doth agree with the Lords in the said amendment.
  This is a clarifying amendment introduced to make clear that, apart from the guaranteed minimum pension, a pension under the Bill needs to be preserved only if there is an entitlement to short service benefits under the preservation requirements of the 1973 Act.
  Question put and agreed to.

Clause 35

  EARNER'S GUARANTEED MINIMUM
  Lords amendment: No. 12, in page 27, line 9, at end insert:
  "In this subsection "week" means any period of seven consecutive days."
  Mr. Meacher: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker: With this we are taking Lords amendment No. 65.
  Mr. Meacher: The amendments were introduced to define "week" in Clause 35(6) as any period of seven consecutive days and to make clear that it is not covered by the definition of "week" in Schedule 20 of the Social Security Act 1975. The purpose is purely beneficial, to ensure that in whatever period of the week a person retires he will be able immediately to receive increments. I hope that it will be acceptable.
  Mr. McCrindle: Of course we must agree with the Lords in the amendment, and I go along entirely with what the Minister said. In any other assembly than the House of Commons to say that a week means any period of seven consecutive days would presumably be unnecessary.
  Question put and agreed to.
  Lords amendment: No. 13, in page 27, line 25, at end insert—
  " or
  (c) such fixed compound rate for each relevant year after that year as may be in force at the time when contracted-out service is terminated and which is, in the opinion of the Government actuary,—

  (i) equal in value to an increase of 5 per cent. plus the further increase secured by the premium calculated in accordance with section 43; and

  61

  (ii) consistent with other assumptions made as to increases in earnings."

  5.0 p.m.
  Mr. Paul Dean (Somerset, North): I beg to move, That this House doth disagree with the Lords in the said amendment.
  Mr. Deputy Speaker: With this we are to take the following proposed amendments to the Bill in lieu of the said amendment: in Clause 44, page 36, line 26, after "unless", insert "either—(a)".
  In page 36, line 28, after "above", insert
  " or (b) those provisions conform with such additional requirements as may be prescribed".
  both standing in the name of the hon. Member for Somerset, North (Mr. Dean).
  Mr. Dean: Perhaps I may briefly explain what these amendments mean, because our procedure for dealing with Lords amendments is somewhat mysterious in this House let alone outside it. I hope, in fact, that the Government will accept Lords amendment No. 13, which is my first choice, but if they do not I hope that they will accept my amendments, which I regard as second best. I put my amendments down, having read the debate in another place and the Government's response to it, as a fall-back position because, as this is the last stage of the Bill when amendments can be considered, I did not want to risk both losing Lords amendment No. 13 and having nothing on the Order Paper to fall back on in its place.
  I again declare my interest in pensions. This is not an occasion for a long speech or for going over all the detailed arguments which have been deployed so often on the question of early leavers. It is an occasion more to remind the House of the background to the amendments and why I think they are of great importance.
  The Bill has a fairly long pedigree, and one of its encouraging features is that there has been broad agreement in Parliament about it. The Opposition recognised in the very early days the need to try to get some political stability into pensions, and the Government, to their credit, responded to that view and have done their utmost not only to listen carefully to what has been said by the interests outside but also to try to respond to amendments put forward by the Opposition.
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  There has been give and take; there has been compromise, and I believe that, as a result, we are going to get a great prize for pensioners—some political stability at long last in pension planning. So it would be a pity if at the very end we were in disagreement on this important matter.
  The Bill, as the Government have said all along, is based on partnership between the State scheme and the occupational—between the State and the private sector, or, to put it another way, between the "pay as you go" arrangement, with all the dangers involved in that, with a blank cheque written for the future, and the funded occupational pension schemes. I believe that this partnership can work, but there are some important provisos. Some important things are threatening to undermine the partnership and make the Bill null and void.
  The first and most obvious of these factors is the ugly spectre of inflation. With inflation running at its present rate, it is in logic nonsense to save because the concept of the negative return means that anybody who puts money aside today is likely to find that that money will be worth less in 12 months' time. Fortunately, human beings are not entirely logical. We are to some extent like the squirrel, who realises come the autumn that unless he gathers some nuts and puts them away for the winter he will be hungry before the spring. He does this in the knowledge that some of the nuts will be eaten by worms or he will lose the place in which he has put them. Human beings are the same. We still put money on one side despite logical considerations which may appear to be against it.
  One of the best and most secure ways in which to put money on one side is in occupational pension schemes. But we have to realise the fears of inflation are spilling over into this Bill, although the Bill of itself clearly cannot provide the cure for inflation.
  Another factor, unhappily, which has been working against the success of this partnership is the pay limits which the Government have recently imposed and the way in which they have to some extent included improvements in pension arrangements within them. I regret that the Government were not able fully to meet the plea put forward by a number of

  63
  us that pension rights should be completely excluded from the pay limits, as they were in all previous pay policies. However, we have at least got an arrangement which is better than nothing. But I fear that there is another element of uncertainty now and the danger of loss of momentum.
  It is such factors which largely explain the growing unease of employers and the pensions industry about the Bill and the contribution that funded occupational pension schemes can make under it. This unease was well expressed in a letter to the Financial Times a few days ago. It was written by the Chairmen of the National Association of Consulting Actuaries, the National Assocation of Pension Funds and the CIB Society of Pension Consultants. It referred to the early hopes which existed for an agreed and, therefore, enduring pension scheme, and went on:
  "Regrettably, these hopes have suffered serious setbacks in the discussions which have taken place on amendments suggested by the pensions industry, although we recognise that some of the proposed amendments have been, at least in part, accepted by the Government. Of course the acceleration in recent months of an already alarming rate of inflation has had much to do with the erosion of confidence. But this makes all the more important modification of features of the scheme which must constitute a major disincentive to employers to contract out."
  I understand that the other pensions organisations feel very much the same as the three signatories of that letter.
  But, of course, the biggest single worry is the obligation for early leavers. We all recognise that there must be a potential clash between what an employer does for the leavers and for the stayers. This is one of the inevitable factors. We have to take into account that the normal human reaction on the part of an employer will be to do more for those who stay with him than for those who leave. We also have to take into account the preservation requirements of the 1973 Act which have recently put additional obligations on employers.
  That is the background to what is a very technical matter, and I fully concede that very few people will understand what it is really about. I also concede to the right hon. Gentleman that I think that the pensions industry—quite understandably, however—does tend perhaps to over-emphasise
  64
  the extent to which employers will be influenced by highly technical arguments when deciding whether to contract out or what to do about their schemes. They will be influenced very largely by broad considerations and only secondarily by technical matters. I do not wish to over-emphasise the amendment as a technical point, but I wish to return to the most important aspect of the broad context against which this matter should be considered.
  I turn to the details of the arrangements. I have never liked the concept of a premium, although I recognise that the concept first arose because the Government—and I give them credit for it—responded to the criticisms made of the arrangements which appeared in the first White Paper. I know that the Minister of State is fond of saying, and will probably say again, that the idea of a premium was conceived by the pensions industry. But it is true to say that there are few friends of the premium left in the industry today, and, indeed, most people would deny paternity for the proposal. We are dealing here essentially with an open-ended commitment which still to some extent exists, despite the modifications which have been made. That is the kernel of the argument against the premium and for the amendment which was successfully moved in the other place by Lord Byers.
  Apart from the open-ended commitment of the matter, I should like briefly to rehearse the arguments against the premium. Again I can do no better than to quote from the letter from the three chairmen of the main pensions organisations. The argument which they used against the premium was as follows:
  "It partially defeats the object of contracting out by channelling money back into the State scheme, where it will be spent, instead of allowing it to remain in the occupational pension fund, where it becomes a productive investment; and it creates a psychological disincentive to contracting out at all by requiring an employer, whenever employees have left his service, to make payments to the State out of the fund, and that just at a time when his business may be contracting and his financial position difficult."
  That summarises the arguments.
  Amendment No. 13 tries to meet these criticisms. It does away with the premium and also takes into account the objections put forward by the Government to a straight 8 per cent. per annum

  65
  without a premium. Therefore, I hope that, having reflected on the arguments used, the Minister will accept Lords amendment No. 13. However, if that is not the case, I hope that the Government will agree to accept my proposed amendment which provides for power to deal with the problem by regulation.
  We are always careful when we seek to give Governments regulation-making powers. We have all argued against them on many occasions, but in this case the argument for such powers is very powerful. It can provide flexibility to deal with detained points which are better dealt with by regulation than as part of the main Bill. Secondly, it can provide time to enable the dialogue to continue so that the search for an acceptable solution to the problem can go on. That is the main reason behind my proposed amendment.
  My amendment asks the Government for action. It is no good having regulation-making powers which lie on the statute book unused. It provides an opportunity for continuing discussion and negotiation in seeking a solution to the problem. I do not ask the Minister of State tonight to prejudge the outcome of any discussions that may take place if he feels able to accept the amendment, but I would ask him for an assurance that he will discuss the matter with the CBI, the TUC and the pensions industry to see how the regulation-making power can best be used. I hope that he will make a genuine effort to obtain an agreed solution through the regulation-making power provided by the amendment.
  5.15 p.m.
  Mr. McCrindle: I begin on a somewhat flippant note by hoping that the "nuts" of the pensions industry were listening carefully to what was said by my hon. Friend the Member for Somerset, North (Mr. Dean) about squirrels gathering nuts for the future. However, that is the only piece of levity I shall permit myself, because we are dealing with an important and serious matter.
  I agree with my hon. Friend that, ideally, the Government would accept the Lord's amendment. However, if we are to be told, as I suspect, that such a course is not possible for the Government, we shall move into a fall-back position. In our proposals we are animated by a genuine desire for some give and take between
  66
  the State scheme and the private pensions industry. That probably means that we must be prepared to accept compromise solutions. It means that on both sides we must do our best to restore and maintain the stability of the pensions industry—an industry which has been under attack in recent months largely because of the sheer uncertainty of the prevailing situation.
  Partnership between the Government and the pensions industry cannot be overemphasised. All the time spent on this Bill in both Houses will have been wasted if the basic aim of the legislation—namely, to take pension provision out of the political arena and to emphasise the need for partnership—is lost. There is a genuine fear among employers and in the pensions industry as they view the difficulties which have been developing in the past few months in regard to inflation.
  It is significant that as we come to the end of this long parliamentary examination of the Bill, the point that continues to exercise our minds is what has been called the open-ended liability. A major purpose of the Bill is to encourage the development of good occupational pension schemes in partnership with the Government. That means encouraging employers to contract out of the State scheme, with all the responsibility which that entails for the employers. The task has been made no easier during the passage of this measure through Parliament by repeated reports that large amounts of money have had to be transferred by employers to their pension schemes to keep them afloat in this excessively inflationary period. Let us imagine the feelings of the good employer who wants a scheme to cover his employees but is becoming more and more alarmed that he is taking on an unknown commitment—in other words, that he is entering a dark tunnel with not the slightest indication of what lies ahead.
  To try to assuage the fears to which I have made reference, the Opposition have pressed upon the Government, during the passage of the Bill, that they must limit the liability and, as far as possible, make clear to an employer the very worst that could happen if he embarked upon an occupational scheme. It would be churlish for me not to concede that the Government have certainly appreciated that point during the parliamentary progress of the Bill and have

  67
  made several changes from the original Bill to try to specify the commitment. No one underrates the difficulties of being exact or of finding exactly the right formula which takes account, on the one hand, of the loss to the State of contracted-out contributions—a point to which the Government must pay attention—against, on the other hand, the need, in certain circumstances, for the State to bolster-up a private pensions entitlement in the interests of the contributor.
  It was against that background that Lords amendment No. 13 was carried. One of the difficulties facing employers and the pensions industry has been to try to establish what liability arises if a member leaves the scheme before retirement date, remembering the highly inflationary times in which we live. The amendment seeks to provide a third option, to those already written into the Bill, in the case of early leavers. In so doing it has sought to make the position of the scheme even more watertight, and the maximum liability in the circumstances I have described even more specific. Yet, in saying that perhaps I can now begin to question whether that is not in itself the undoing of the amendment.
  I hope that Lord Byers, who has been so prominent in trying to improve the scheme, will not take it amiss if I ask aloud whether what the amendment does is not to be more specific but perhaps in a way to be too specific.
  Many of the fears expressed in this matter relate to the impact of inflation. If it were to be controlled, as all hon. Members must hope that it will, many of the fears to which I and other hon. Members have spoken today would begin to fall away. Remembering that the Bill will be the basis of pension arrangements for many years to come, it would perhaps be unwise to be too inflexible, and to some degree I believe that that is what might be said of Lords amendment No. 13.
  Under the present provisions of the Bill when an employee leaves having qualified for a reserve pension, the employer has the choice of revaluing the pension either in full or at a fixed 5 per cent. per annum and, in addition, paying a premium to the State. Lords amendment No. 13 would allow the employer to pay no premium and to revalue the pension at
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  the fixed rate assumed for the purpose of calculating the premium that he would have had to pay if he had chosen the second existing alternative.
  I apologise to the House for what may seem to many a rather obscure quotation, but, unfortunately, as we move forward in social security matters it becomes increasingly difficult to simplify the position.
  At this stage it would perhaps be wrong to suggest that the additional option that Lords amendment No. 13 would provide is likely to affect materially the situation whether an employer embarks upon an occupational pension scheme to any major degree. It is clear from what I deduce that the Government are unhappy about accepting it.
  In those circumstances, I turn to my hon. Friend's amendment, because I believe that both the Lords amendment and the amendment moved by my hon. Friend the Member for Somerset, North represent an understanding of the difficulty, the need for reassurance and the desirability—if it can be achieved—of moving forward without too much controversy, at the end of our deliberations, between the Government and the Opposition.
  My hon. Friend's amendment can be described as keeping the options open while making very clear the continuing alarm and concern which exist. It accepts that we cannot tell what the future holds, especially concerning inflation, and that if employers were to be seen—I hope that the Minister will take note of this—in the comparatively early stages of the working of the Bill to be holding back for fear of commitments, the Government would have to take specific and, it is hoped, perhaps less complicated action than is at present recommended in the Lords amendment.
  Therefore, perhaps it is more important to obtain agreement across the Floor of the House between the Government and the pensions industry than it is to be specific and to provide a third option. I believe that in some ways my hon. Friend has had the better approach, and, provided that the Minister can tell me that the Government will provide specific proposals if it became evident that they were necessary, the House would be wise

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  to support my hon. Friend and keep its options open.
  I should like to refer to two quotations. The first is a letter which I received from the Life Offices Association, which, as hon. Members will know, is among the leading interests in the pensions industry. When referring to the amendment put forward by my hon. Friend it says:
  "I should like you to know that the Life Offices Association support fully the amendment, in the hope that it will lead to a genuine attempt by all concerned to find an acceptable solution to a problem which, if unresolved, will militate against contracting-out when the State scheme is introduced in 1977 or 1978."
  In other words, the Life Offices Association, which is one of the principal providers of pensions, is saying, in effect, that my hon. Friend's approach, accompanied, one hopes, by an undertaking from the Minister that a continuing understanding of the problem is present in the Department, would perhaps be the best one.
  I refer to the letter which my hon. Friend quoted on two occasions during his speech. The letter is from three leading people in the pensions industry. In the last paragraph, referring to Lords amendment No. 13, they say:
  "It is therefore our most earnest hope that something on the lines of the amendment agreed to in the Lords on Wednesday will be retained in the Bill when it returns to the Commons today."
  I believe that my hon. Friend is giving the House and the Government an opportunity to introduce something on the lines of the amendment by Lord Byers. To that extent I commend my hon. Friend's approach, and I hope that the Government will be able to accept his amendment.
  Mr. O'Malley: This is, perhaps, almost the last debate on a substantial point which we shall have during the proceedings in this House, or, indeed, in Parliament, on the Bill.
  We are dealing with a matter of some concern and worry to the pensions industry. I hope that the House will accept what I have to say on both the amendment from the noble Lords and the counter-amendment, or the alternative proposition, which the hon. Member for Somerset, North (Mr. Dean) has explained. I believe that the House understands that throughout the whole of the proceedings on the Bill there has been a
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  willingness, certainly on the part of the Government and I should like also to say certainly on the part of the Opposition in this House, to bring to an end 15 years of disagreement about pension provision. We have tried jointly and collectively in the House to achieve a legislative structure in which we can have a viable and thriving partnership between occupational pension provision, on the one hand—whether in the public sector or in the private sector—and the national insurance scheme arrangements, on the other hand.
  5.30 p.m.
  The House will recognise that the Government have already moved substantially on the question of preservation. It should be pointed out that when the White Paper was published it was proposed that the whole of pre-award dynamism in respect of early leavers was and should be the responsibility of the employer in occupational pension schemes. Proposals were made to the Government from a number of major and important sectors of the pension industry. As the hon. Member for Somerset, North said, one important sector of the industry suggested that as an alternative to the proposals put forward in the White Paper we should place a limited obligation upon employers and upon the fund and that the remainder of any obligation should immediately be bought out by the payment of a premium at the time when the employee left his employer after working for him for a period of more than five years.
  The Government had hoped at that time that, whatever other discussions and divisions there might be on the Bill, agreement had been reached on the situation of the early leaver. One thing that we were determined to achieve and determined to maintain whatever changes were made in the structure of the Bill, was that when men and women change their employment, rather than having one employment during the whole of a 40–year working life, they should not lose inflation proofing as a result of this change, because he is an exceptional man and she is an exceptional woman who stays in one employment in the kind of industrial and economic background that we have for the whole of his or her working life.
  Nevertheless, it was the case that other sections of the pension industry objected

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  from the outset to any idea of a premium. The representative organisation which came forward with the concept of the premium has now changed its mind and said that it would prefer an alternative arrangement. I do not condemn the organisation for that. It is not uncommon in the conduct of human affairs for individuals or groups of individuals to change their minds.
  I regard this not as an issue of principle but as a technical issue which we should do our best to solve. Even after the publication of the Bill with the premium system, I introduced a number of substantial easements which I thought would reassure the pension industry on the problem of the open-ended commitment. I need not recount to the House what those attempts were to close what became known as the open-ended commitment.
  I have now been pressed by the industry and in this House, as was my hon. Friend in another place, to have alternative arrangements, because it is being suggested that to leave the arrangements as they are could act as a substantial barrier, albeit a psychological rather than a financial barrier, to employers who were considering contracting out.
  I have nothing to add to the comments which were made in another place when the amendment of Lord Byers was resisted. I would merely say briefly that that amendment was at that time unacceptable to the Government and remains unacceptable, for a number of reasons, including complexity, uncertainty for all those concerned, and potential cost on the national insurance fund.
  Therefore, I certainly support the motion—I recognise the technical problems in which the hon. Member for Somerset, North would have been involved in tabling his amendment—which asks the House to disagree with the amendment which has been brought from another place.
  Having said that, I must go on to say that I am still not convinced that it is necessary to put any substantive provisions in the place of that amendment. However, I recognise that there are still some genuine apprehensions in the pension movement about the effect of the
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  early leaver provisions and the volume of contracting out. I am prepared, as I have been requested to do this afternoon by the hon. Members for Somerset, North and for Brentwood and Ongar (Mr. McCrindle), to go on talking about those apprehensions with the pension industry. Indeed, the House will wish to know that only on Wednesday of last week I met the representatives of a number of organisations in the pension industry.
  Very difficult technical problems are involved. I have said that I do not think that there is a matter of principle involved, but if we are to have other options—other alternatives—rather than the 5 per cent. plus the premium, or the employer taking on the whole of the pre-award dynamism in respect of the early leavers, first, under any such option the individual himself or herself must not be adversely affected and, secondly, we must pay regard to administrative complexity.
  However, I am prepared, if it is the wish of the pension industry, to add some complexity to the Bill, because any other option would cause more complexity, if we can reach an agreed solution on this part of the structure of the Bill.
  The third factor must clearly be that any other options must not involve the national insurance fund in any additional burdens.
  Therefore, I am prepared to accept the amendment in the name of the hon. Member for Somerset, North, but I make it clear to him and to the House that I am not at this time entering into a commitment of any kind. I can give no positive undertaking that the Government will use the power in any particular way or, indeed, at all. If the Government were to use this power, our aim would be to be fair as between those contracted out and those contracted in and to avoid adding to the burdens of the national insurance fund.
  We are seeking partnership. That is why I am prepared to continue the consultations with the pension industry. Provided that it is clearly understood that I am making absolutely no commitment of any kind other than to the willingness of the Government to continue to consider this technical problem with the pension industry, I am prepared to continue with

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  the dialogue and to accept the amendments which have been moved by the hon. Member for Somerset, North.
  I hope that that will be helpful to the House, but, more than that, I hope that it will mean that having over the months disposed of issue after issue which divided the pension industry and the Government on the structure which we were putting forward we shall be able in the future to resolve this problem so that we can have the best auguries for a successful start to the proposals and the structures laid down in the Social Security Pensions Bill 1975.
  Mr. Paul Dean: I am sure that the whole House is grateful to the right hon. Gentleman for what he says and for recommending the House to accept the amendment. I fully understand that he cannot make any absolute commitment, but I am sure that the whole House will cheer him on in the continued discussions and negotiations that he is to have in order to try to reach an agreed solution to this difficult matter and one which will provide an additional measure of confidence to those who have to make decisions about the future of pension schemes and to those who advise them.
  This has been a good example of a parliamentary process of which we in the House and, indeed, in Parliament can be proud. The Government have shown themselves ready to consult and to meet points when the need for these points has been established. Equally, we have done our utmost to assist the Government in improving the Bill. Equal credit is due to those outside who have advised the Government and the Opposition in trying to reach this solution.
  We now have, one hopes, political stability in pensions for the first time for many years. Our need is to be able to put our economic and financial house in order, so that this Bill can really mean something in practice. But, having done that, I think we can fairly say to those outside that the ball is now in their court to carry this legislation forward and to see that what we have tried to achieve in this place becomes a success in practice.
  Question put and agreed to.
  Amendments made to the Bill in lieu thereof.
  In page 36, line 26, after 'unless', insert:
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  'either—
  (a)'.
  In page 36, line 28, after 'above', insert:
  'or
  (b) those provisions conform with such additional requirements as may be prescribed'—[Mr. Paul Dean.]

Clause 36

  REQUISITE BENEFIT FOR WIDOW
  Lords amendment: No. 14, in page 27, line 41, leave out from "scheme" to end of line 5 on page 28 and insert—
  "(1A) Subject to subsections (1C) and (1D) below, the scheme must conain rules whereby the annual rate of the pension will be not less than the requisite minimum under this section, which is 5/8ths per cent. of either—

  (a) the earner's average annual salary in the whole period of his service in contracted-out employment by reference to the scheme; or

  (b) his final salary (or last salary before death),

  multiplied by the number of his years of such service; and section (Earner's salary as factor of widow's pension) below applies as to the relationship which the widow's pension must bear to the earner's salary.
  (1B) To comply with this section the scheme must also contain a rule to the effect that if the earner had a guaranteed minimum under section 35 above the weekly rate of the widow's pension will be not less than her guaranteed minimum, which shall be half that of the earner.
  (1C) Where it is a condition of the scheme that the earner shall complete a specified minimum period of service before qualifying for requisite benefits in excess of guaranteed minimum pensions the scheme need not contain the rules specified in subsection (1A) above for the case of the earner's service being terminated (by death or otherwise) before completion of that minimum period."
  Mr. O'Malley: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker: With this we are to take Lords amendments Nos. 15, 16, 17, 18 and 19.
  Mr. O'Malley: These Government amendments were introduced as a result of a further consideration of the provision for widows which was promised during the Committee stage in another place. The effect of the amendments is that in order to qualify for contracting out, an occupational pension scheme has to provide a widow's pension based on an

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  annual accrual rate of five-eighths per cent., for each year of the late husband's contracted-out service of his final salary or average salary revalued.
  Question put and agreed to.
  Subsequent Lords amendments agreed to.

Clause 39

  FINANCING AND ASSURANCE OF BENEFITS
  Lords amendment: No. 22, in page 31, line 20, leave out from beginning to "does" and insert:
  "under the scheme in respect of benefits attributable to any period of service after the rule has taken effect.
  This"
  Mr. O'Malley: I beg to move, That this House doth agree with the Lords in the said amendment.
  The Government introduced this amendment in response to representations made by Lord Banks, who referred to difficulties that occupational pension schemes might have in modifying scheme rules to comply with the priority rule in Clause 39(3). The effect of the amendment is that the items listed in Clause 39(3) will take priority only in relation to benefits arising after the priority rule comes into force.
  Question put and agreed to.

Clause 41

  PREMIUM ON TERMINATION OF CONTRACTED-OUT EMPLOYMENT
  Lords amendment: No. 23, in page 33, line 26, leave out "which" and insert:
  "in respect of which the scheme"
  Mr. Meacher: I beg to move, That this House doth agree with the Lords in the said amendment.
  This is purely a drafting amendment.
  Question put and agreed to.

Clause 42

  PREMIUM UNDER SECTION 41: ADDITIONAL PROVISIONS
  Lords amendment: No. 24, in page 34, line 22, leave out "length of" and insert "lengths of relevant".
  Mr. O'Malley: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker: With this we are to take Lords amendment No. 25.
  Mr. O'Malley: These Government amendments were introduced to make it clear that for the purposes of the requirement for an employer not to discriminate between different earnings on any grounds other than length of service in relation to electing for a contracting-out certificate, "certificates" means contracting-out certificates.
  Question put and agreed to.
  Subsequent Lords amendment agreed to.

Clause 43

  PREMIUM ON TERMINATION OF CONTRACTED-OUT SCHEME
  Lords amendment: No. 26, in page 35, line 7, leave out from "otherwise)" to end of line 16 and insert "then—

  (a) in respect of each earner whose accrued rights to guaranteed minimum pensions under the scheme are not subject to approved arrangements; and

  (b) in respect of each person who has then become entitled to receive a guaranteed minimum pension under the scheme and whose guaranteed minimum pension rights are not so subject,

  a state scheme premium shall be payable by the prescribed person."
  Mr. Meacher: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker: With this we are to take Lords Amendments Nos. 27, 28, 29, 30, 31 and 32.
  Mr. Meacher: These are partly drafting amendments but also, in the case of Lords amendment No. 26, they add some administrative flexibility by providing that both the accrued rights premiums and pensioners' rights premiums are to be paid by the prescribed person. The purpose is to provide greater flexibility, in that they can be paid not only by the employer but also by the scheme manager or the scheme trustees.
  Question put and agreed to.
  Subsequent Lords amendments agreed to

Clause 51

  EQUAL ACCESS REQUIREMENTS
  Lords amendment: No. 33, in page 43, line 4, leave out from beginning to "are" in line 11 and insert—
  "(1) The provisions of sections 54 to 56 below shall have effect with a view to securing that the rules of occupational pension schemes conform with the equal access requirements.
  (2) Subject to subsection (3) below, the equal access requirements, in relation to a scheme".
  5.45 p.m.
  Mr. O'Malley: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker: With this we are to take Lords amendments Nos. 34, 35, 36, 37 and 38.
  Mr. O'Malley: These are technical amendments.
  Question put and agreed to.
  Subsequent Lords amendments agreed to.

Clause 64

  CONSEQUENTIAL AMENDMENTS AND REPEALS
  Lords amendment: No. 42, in page 53, line 1, after "in" insert "Part I of".
  Mr. Meacher: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker: With this we are to take Lords amendments Nos. 43 and 66.
  Mr. Meacher: These are again technical amendments.
  Question put and agreed to.
  Subsequent Lords amendment agreed to.

Schedule 1

  DEFERRED RETIREMENT
  Lords amendment: No. 46, in page 57, line 6, leave out from "age" to second "the" in line 7.
  Mr. O'Malley: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker: With this we are to take Lords amendment Nos. 47 to 54.
  Mr. O'Malley: These are not quite technical amendments, but they are almost technical amendments. The amendments remove unintended consequences of the original provision relating to increments in the Bill. They ensure that a de minimis rule operates in respect of increments, so that payments under increments are limited to pensions of at least 1 per cent. A person should have worked for a period of eight weeks on the one-eighth per cent. rule which we discussed in Committee.
  Question put and agreed to.
  Subsequent Lords amendments agreed to.
  Lords amendment: No. 64, in page 71, line 33, leave out paragraph 50.
  Mr. Meacher: I beg to move, That this House doth disagree with the Lords in the said amendment.
  The Lords amendment requires the Secretary of State, in each tax year, commencing with the tax year 1976–77, to consider whether the mobility allowance should be increased, having regard to the national economic situation, the general standard of living and any other matters he thinks relevant. Two Government amendments have been tabled in response to an amendment which was successfully moved against the Government in another place during the Report stage of the Bill.
  The Lords amendment was one which seemed to be seen by its supporters primarily as a guarantee of annual reviews, but which would in fact have required annual upratings in line with earnings. Indeed, it is our purpose to ensure that the final legislation takes full account of what we believe was in the minds of their Lordships when they moved this amendment, though there may in fact be some dubiety. The purpose of this amendment is to remove that. If the relevant paragraph is left out, according to the amendment in another place, it omits the exemption of mobility allowances from automatic annual review and upratings. We are therefore concerned obviously to include the exemption which we believe was the original intention, at least as regards automatic uprating, but what we are seeking to do is to replace what we believe was the gist of the

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  debate in another place by committing ourselves to a regular review, but not necessarily to an annual uprating.
  The effect, therefore, of the two Government amendments together is to require an annual review of mobility allowance but to leave the decision on any uprating to be taken in the light of national economic circumstances at the time. This corresponds precisely to the position under the provisions which relate to child benefit. Clearly it would be very desirable if all benefits which were introduced by the Government irrespective of the kind of benefit were to be subject to an automatic uprating. No doubt in a world which was free of major expenditure constraints, that would be an ideal solution. But when there are very tight expenditure restrictions, it is not possible that this should apply to all benefits automatically. The Government have no alternative but to make it clear that we must remain free to decide whether it is possible at any time to commit scarce additional resources to this important extra item for the disabled.
  This allowance will benefit many of the most severely disabled people who in the past have received no help with their mobility problems simply because they could not drive. The amount and the scope of the allowance are not as large and as wide as some would like. But the allowance is a major and important step forward. We are determined to ensure that it is not put on the shelf and that it does not lose any significant degree of its value over time.
  Automatic upratings in line with earnings may be appropriate with regard to basic maintenance benefits, but clearly they are of a different order of importance from these benefits which will be paid on top of other benefits or on top of earnings. The simple effect of the amendment, therefore, takes account of the rather different nature of the mobility allowance from basic maintenance benefits.
  In case there is any doubt about the position in respect of the Bill as it reaches this House, we seek to make it clear that we will commit ourselves to consider mobility allowance in the light of the national economic situation but that it is not possible to make the same guarantee in respect of this benefit as
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  regards other maintenance benefits. I hope that that is broadly acceptable.
  Mr. Norman Fowler: When the mobility allowance was first debated in this House, we pointed out the need for some kind of review procedure. That need has been made out by the very brief history of this allowance.
  The allowance was announced in September 1974. At that stage it was set at £4. In June the Secretary of State announced that when it was to be introduced, which is not until the beginning of 1976, it would be put at £5. The House might expect the Government to have been apologetic about the rate of inflation which had caused this increase, but not a bit of it. The right hon. Lady told the House that the 25 per cent. increase was remarkable and was the first uprating of a benefit that had ever taken place to her knowledge before it had been introduced. In other words, rather than apologising for the horrific rise in inflation, the right hon. Lady was seeking our applause.
  The right hon. Lady's script has changed, but there are still some questions which have to be asked. The House would do well to remember that this allowance, even now that it is put at £5, is unlikely when it is first paid at the beginning of next year to be worth £4 as it was announced originally. That is the price of inflation. That is what inflation has done to this allowance.
  Let is also remember that the £5 a week is not by any definition a princely sum. We welcome the mobility allowance. But we also recognise its limitations.
  It is recognised on both sides of the House that there is a real need for a review procedure. One way would be by means of an annual review linked to prices or to earnings. The Minister has rejected that. The implication of the Lords amendment is that the other place supported that. The other way is that now proposed by the Government in their amendment. We welcome the fact that the Government have at least—again after a defeat in the Lords—moved some way on this point. But there are two vital questions which will have to be answered by the Minister before we can accept this compromise.

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  The amendment proposed by the Government is that the Secretary of State shall consider whether the rate of mobility allowance should be increased having regard to the national economic situation as a whole, the general standard of living, and such other matters as he thinks relevant. Is not that what the Government would do in any event? Would not any Secretary of State worth his salt do just that? Therefore, I ask the Minister how this amendment alters the real position.
  Mr. Lewis Carter-Jones: Why did not the hon. Gentleman and his Government look at this between 1970 and 1973?
  Mr. Fowler: I am glad that we have at last had the first back-bench intervention from a Government supporter—
  Mr. Arthur Lewis: It was a good one.
  Mr. Fowler: It was quite a good one. However, the Secretary of State, whom we are pleased to see in her place, must come to the conclusion that it is her legislation that we are debating. If she wishes to debate what happened between 1970 and 1974, doubtless that can be arranged. But we are not discussing that at the moment.
  I repeat my question. How has the Government's amendment altered the position as it affects the Government? I ask the question to elicit information. I do not intend to try to establish the fact that concern about these matters is the monopoly of one side of the House or the other.
  The second question concerns the criteria which the Secretary of State will use. The amendment refers to taking into account the general standard of living. Does that mean that there is a requirement on the Secretary of State to consider prices and the level of prices and earnings and the level of earnings over the 12–month period after which she will review this benefit? I think that that is the case, but I should like the Under-Secretary's confirmation that it is. We want to be sure that this amendment is not just a matter of words but that it actually means something real and right to the people we are all seeking to help.
  Mr. Deputy Speaker: I should have pointed out that privilege is involved in this amendment.
  Mr. Carter-Jones: I hope that my hon. Friend the Under-Secretary has tabled this amendment to save me embarrassment. Had the amendment not appeared on the Notice Paper, I fear that I might have had to vote against the Government on this one.
  I like the idea of an annual review. However, this amendment is a nice one in the sense that the Secretary of State has not adopted a low profile. She is a duck in a position where she can be shot at in the future. We now have an amendment which gives my right hon. Friend a fair amount of power to intervene. At the same time, it gives us the opportunity from time to time to fire at her if we feel that the allowance is not as great as it should be. It is not unknown for me to vote against the Government on such issues. I look forward to my right hon. Friend's review. I hope that she will consider the matter carefully.
  In view of the amendment, which I support wholeheartedly, I am at long last in a position to tell my Government "I am on your side on this."
  6.0 p.m.
  Mrs. Jill Knight: I support the Lords amendment, rather than the Government amendments, because the Lords are saying that there should be an annual review, and the Government do not say that. With the Lords amendment, we know what would happen.
  Their Lordships felt that there was a strong case for an annual review, as petrol has just about doubled in price in the past year. I do not altogether blame the Government for that, although they must bear some of the blame, because of the increased tax. Moreover, rail fares have increased by 50 per cent. in the past 18 months, and may very well go up again before long.
  In those circumstances the Lords were saying clearly that they were not merely paying lip service to the aim of encouraging mobility among severely disabled people, but that those facts must be taken into consideration. How can the disabled

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  be mobile in the face of sharply increasing costs if we do not permit an annual review?
  I do not understand what the result of the Government amendments will be, but I understand what the Lords amendment will do. It is much clearer and fairer, and, therefore, I support it.
  Mr. Boscawen: I support the annual review, not necessarily because of the level of benefit but because it gives the House an opportunity to consider the structure of the new benefit. We want to examine the structure, including the age limits, frequently. For example, the age limit of 65 is an important and disliked limit on the allowance. If the Government amendments meant longer intervals between examinations of the structure of the new allowance, I should strongly deprecate that. When it has been working for a year we want to have a jolly good look at it.
  Mr. Newton: I support the Lords amendment, though I prefer the amendment which was not pressed at the Committee stage in another place to the one which the Government are resisting now. I do not know whether this is what you meant by privilege, Mr. Deputy Speaker, but I think that their Lordships got it wrong in not pressing what they asked for earlier, rather than pressing the amendment that we are discussing. At an earlier stage their Lordships wanted the allowance to be specifically related annually to the rise in travel and motoring costs, rather than being on the same basis as pensions, which are related to earnings. That makes a great deal of sense.
  For reasons that I have explained in Finance Bill debates, I am generally in favour of the indexing of such allowances. In considering the mobility allowance we are dealing with a group of people who no hon. Member would wish to suffer cuts in their standard of living, even at a difficult time. We all agree that we are talking about a priority group, and we want to protect them from the ravages of inflation, even if we cannot protect everyone.
  We are also dealing with a sector of inflationary costs, travel costs, which, partly because they arise in industries which are so labour-intensive, have been
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  rising even faster than the general rise in prices, and may continue to do so over the next few years. That is especially true of motoring costs, in view of possible oil price increases. Therefore, it would be right to index the allowance to travel costs rather than anything else, certainly rather than the almost meaningless formula for which the Government try to obtain credit.
  It is also important—and this is why I shall not vote against the Government's amendments—that the allowance should be reviewed fairly soon. It has been made taxable, something against which I have argued strongly in Finance Bill debates. I suspect that for that reason it is not worth as much in travel terms to some people who receive the old private car allowance as that allowance was when it was introduced, and that, therefore, we are debating a proposal which reduces the amount of mobility available to some disabled people who happen to be paying tax. Figures from the Disablement Income Group suggest that some disabled people changing from the old private car allowance will be worse off. Treasury Ministers have been unable to quarrel with me about that. It is another good reason for examining the allowance annually.
  I acknowledge the step that the Government have taken, but I wish that they had gone further. The Secretary of State is to consider the matter every year. May we have an undertaking that the result of that consideration will be explicitly set out at the time of the annual review when the announcement is made at Budget time? It is not good enough for it to be swallowed up in Whitehall somewhere, so than when questions are asked later Ministers can just say "We considered this, but we decided to do nothing about it". We want a formal paragraph in the statement of annual review saying that the matter has been considered and that all the factors have been taken into account, and stating the conclusion, so that Parliament has a proper opportunity to discuss it. If we may have that undertaking, we shall be much happier with the formula than we are now.
  Mrs. Lynda Chalker: I very much agree with the points made by my hon. Friend the Member for Braintree (Mr. Newton), because the disabled face

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  an extra increase above the normal motoring costs that the rest of us who are able-bodied face. I would have preferred the annual review.
  During the past few months, because of the debates here and in another place, many misunderstandings have arisen about the effect and meaning of the mobility allowance. We are talking about a periodic review, not an annual review as with other benefits, but a review which it should be within the province of any Secretary of State to make of all allowances. Will the Government undertake this evening to publish a clear and unequivocal statement about the exact effects of the mobility allowance when it comes in, and will they take up the points made by my hon. Friend? Many people are asking "Can we go on working past the age of 65, because we may lose our vehicle or not receive the allowance?" The muddle in the minds of the disabled is very worrying and is causing a great deal of unhappiness.
  Mr. Meacher: There was an innuendo in the speech of the hon. Member for Sutton Coldfield (Mr. Fowler) that what the Government proposed was nothing more than they were obliged to do anyway. I am glad to say that several of the hon. Gentleman's hon. Friends did not take his line, but saw great merit in our proposal. For his sake, but less for theirs, I shall spell it out.
  We are committing ourselves to a review. The difference between what we propose here and what, for example, was done in the case of the family allowances under successive Conservative administrations is that then there was no review—annual or any other kind. In the case of family allowances, for example, there has been no increase by any Conservative administration since 1956. If there had been a commitment to a review, I should be surprised if no increase would have resulted. That indicates the value and importance of what is being proposed. I am glad to see that my hon. Friend the Member for Eccles (Mr. Carter-Jones), who has played such an important rôle in so many of these matters, also believes that this is an important innovation. I am convinced that it is.
  I was also asked by the hon. Member for Sutton Coldfield what we would take into account when we made an examination
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  of the mobility allowance, and whether it was merely a matter of prices and earnings. Obviously prices and earnings are prime economic indicators, and we are bound to take account of them. However, we are also bound to take account of other economic issues at the time. I therefore cannot give the hon. Member the kind of comprehensive answer he might want, because it is left open-ended. The reason we cannot commit ourselves to a Section 125-type of uprating is that we have to take into account all the economic indicators at the time.
  The hon. Member for Birmingham, Edgbaston (Mrs. Knight) and her hon. Friend the Member for Braintree (Mr. Newton) referred to the fact that petrol had doubled in price. That is a somewhat irrelevant comparison, because the whole point of the mobility allowance is that it shall go to those persons who have either no mobility or scarcely any mobility. That does not necessarily mean that the allowance will not go to those who have a private car allowance, but it is not primarily for that type of person—it is for a different type of person. Therefore, the allegation that petrol has sharply increased in price and has a direct implication for the mobility allowance is somewhat misplaced.
  Mr. Carter-Jones: I am sorry to dig the dagger in here, but the mobility allowance was intended to give mobility to about 100,000 extra people. Last week taxi fares rose substantially in the London area. The mobility allowance was intended to include that 100,000 people. Will my hon. Friend allow us to question him on this matter in 12 months' time?
  Mr. Meacher: I entirely accept the point about taxi fares. It is also true that the mobility allowance was introduced primarily to benefit many of the most severely disabled persons who, in the past, have received no help at all with their mobility problem, simply because they cannot drive. I do not wish to labour this point. I simply do not believe that its relationship to the increase in the price of petrol is very relevant.
  The hon. Member for Wells (Mr. Boscawen) made a fair point when he said that our commitment to a review would give the House an opportunity to examine the structure flexibly and to

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  consider the position on uprating. There will be a full opportunity for all hon. Members to question my right hon. Friend the Secretary of State on the operation of the mobility allowance, its application, and how it affects people. They will have that opportunity as a result of the commitment to the review.
  Mrs. Knight: If the hon. Gentleman does not agree that petrol costs have any effect on the mobility allowance, does he agree that increases in train fares have an effect?
  6.15 p.m.
  Mr. Meacher: They have an effect for those who, despite their disablement, are able to use a train and a taxi. There are some persons whose disability is such that they are not able to use even those forms of transport. The mobility allowance is designed primarily to assist that group. However, I do not wish to pursue that point.
  Many economic factors are relevant in considering the uprating. Certainly the rise in petrol costs is only one, and I should not consider it a prime one.
  Mr. Newton: Will the Minister make it clear whether, so far, we have a undertaking that in the annual review statement, which is normally made around Budget time, there will be a specific reference to the question of the mobility allowance? Primarily, that is what I want to hear.
  Mr. Meacher: I am not necessarily making that commitment. I am saying that we are committed to a review. However, this is known because it has been publicly stated by Government spokesmen. Therefore, it will be open for any hon. Member to press my right hon. Friend the Secretary of State or any other Minister for the results of that review.
  I hope that it will be accepted that this is a significant change, and one which might be expected to lead to significantly different results as compared with that other, so often shelved benefit, family allowance. There is no reason, because of what we are committed to doing—which is different from the situation when the Bill went through the other place—to suggest that this benefit will go the way of the family allowance. I am convinced that it will not, and on those
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  grounds I hope that it is acceptable to all hon. Members.
  Mr. Norman Fowler: I fear that the Under-Secretary is having a bad effect on me. Every time he puts forward his argument he makes me want to vote against him, and sometimes against my own better judgment and preconceived ideas. He has accused me of innuendo. All I said was that when the mobility allowance was announced in September 1974 it was set at £4. In June 1975 the right hon. Lady the Secretary of State increased it to £5, and it will be paid for the first time in January 1976. The point I am making is not innuendo; it is a fact that the allowance has to keep up with inflation. There is no big deal about that. Inflation has got out of control, and if the Under-Secretary does not know, he is the only member of the Government who does not. That is not innuendo. It is a fact that he had better come to terms with promptly.
  It is a difficult choice. The annual review is clearly preferred by one or two of my hon. Friends. I am prepared to concede that the Government have taken a step—perhaps a faltering step—in the right direction. We shall want to see how this works. However, at this stage we are prepared to let it go, despite the Minister's arguments.
  Question put and agreed to.
  Amendments made to the Bill in lieu thereof: In page 13, line 29, at end insert—
  '(3A) In the tax year 1976–77, and thereafter in each subsequent tax year, the Secretary of State shall consider whether the rate of mobility allowance should be increased having regard to the national economic situation as a whole, the general standard of living and such other matters as he thinks relevant'.
  In page 71, line 33, leave out from 'Act' to end of line 35 and insert—'for paragraph (a) there shall be substituted—
  "(a) Parts I, IV and V of Schedule 4 to this Act and paragraphs 1 to 3, 4 and 5 of Part III; and"'.—[Mr. O'Malley.]
  Mr. Deputy Speaker: I should not like my generosity to go unnoticed. I did not require hon. Members to seek leave to speak again, because we are not in Committee.
  Remaining Lords amendments agreed to.
  Committee appointed to draw up a Reason to be assigned to the Lords for disagreeing to one of their Amendments to the Bill: Mrs. Barbara Castle, Mr. John Ellis, Mr. Norman Fowler, Mr. R. A. McCrindle and Mr. Brian O'Malley; Three to be the quorum.—[Mr. O'Malley.]
  To withdraw immediately.
  Reason for disagreeing to one of the Lords Amendments reported, and agreed to: to be communicated to the Lords.

CHILD BENEFIT BILL
Lords amendments considered.
Clause 5

  RATE OF CHILD BENEFIT
  Lords amendment: No. 1, in page 3, line 29, leave out "shall" and insert "may".
  6.20 p.m.
  The Under-Secretary of State for Health and Social Security (Mr. Michael Meacher): I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker (Mr. George Thomas): With this amendment we are to take the following:
  Lords amendments Nos. 2 and 6.
  Mr. Meacher: These three amendments, which firmly establish the Government's commitment to the principle of variation in rates of child benefit, merely put into an appropriate form the amendments tabled by my hon. Friend the Member for Stockport, North (Mr. Bennett) on Report. At that time, when accepting my hon. Friend's amendments, we explained that they were technically defective and would need revision in another place. I am advised that the amendments as redrafted have the precise meaning and the same degree of force as the original amendments. I hope they will commend themselves to the House.
  Mr. Deputy Speaker: I should inform the House that privilege is involved in Lords amendment No. 1.
  Sir George Young: My hon. Friends and I are thoroughly confused by the action of the Government in connection with Lords amendment No. 1, and indeed its predecessors. To describe what they have done as a series of somersaults would be flattering, because to perform somersaults requires a certain amount of agility. It would be more correct to say that what they have done is, tediously and incoherently, execute a series of U turns.
  The Lords amendment to which we are invited to agree relates to Clause 5(2). This deals with age-related benefits. As

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  the subsection was sent to this House, it read:
  "Different rates may be prescribed in relation to different cases, whether by reference to the age of the child in respect of whom the benefit is payable or otherwise."
  Hon. Members thought that that wording did not ascribe a sufficient degree of urgency into the introduction of age-related benefits, and six amendments were discussed in Standing Committee A on 19th June. There was one vote, on an Opposition amendment, and it was defeated.
  The Committee discussed Amendment No. 24 in the names of the hon. Members for Stockport, North (Mr. Bennett) and Walsall, South (Mr. George) which proposed that the word "may" be deleted and the word "shall" substituted. This would have reflected a higher degree of urgency to introduce age-related benefits. The hon. Member for Stockport, North said:
  "Will he look, therefore, at Amendment No. 24? I am advised that, in legal terms, the substitution of 'shall' for 'may' is not so important. But will he consider on Report, agreeing to the strengthening of Clause 5 to provide that different rates 'shall' be prescribed instead of that different rates 'may' be prescribed? "—[Official Report, Standing Committee A; 19th June 1975, c. 106–7.]
  In the winding-up speech to that debate is was never suggested that the amendment was technically defective. Normally that is a Minister's first line of defence, but it was not deployed on that occasion. Instead the Minister fell back on his second line of defence and said that if he entered into detailed discussions and consultations with his hon. Friends who had put forward such a firm view for which he had infinite respect and sympathy, perhaps they would be courteous enough to withdraw the amendment. His hon. Friends obliged. The Committee heaved. The Committee whip heaved a sigh of relief and the Committee moved on to Amendment No. 25.
  Before Report, discussions and consultations clearly took place, because when the Report stage of the Bill was taken on 7th July Amendment No. 24 reappeared, this time under the alias of Lords amendment No. 6. It was called with Amendment No. 7, which gave the Secretary of State the privilege of appointing the day on which age-related benefits
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  were to be paid. Amendments Nos. 6 and 7 proved to be acceptable to the Minister because he said:
  "…I am certainly prepared to accept Amendments Nos. 6 and 7 in the name of my hon. Friend the Member for Stockport, North as a means of providing reassurance, not just to the House but to interested organisations outside, that it is not intended to continue with flat-rate benefit indefinitely."
  The Minister then went on to make a rather curious statement:
  "The amendments as drafted are defective."
  This is curious because the Minister had had discussions with his three hon. Friends between the Committee and Report stages but he had not apparently been able to furnish them with an amendment which was not defective. This strikes me as curious because so far as other Bills are concerned, when Opposition amendments have been acceptable the Minister has made sure that the amendments were not technically defective, and I am surprised that he does not render the same service to his hon. Friends as he renders to the Opposition.
  The Minister went on to say:
  "I understand that the draftsmen will need to improve on my hon. Friend's efforts. But I am prepared to accept them this evening hoping that my hon. Friend will understand that they will need revision in another place."—[Official Report, 7th July 1975; Vol. 895, c. 231.]
  The House therefore amended the clause, "may" was deleted and "shall" was inserted.
  The Bill then passed to the other place and we on this side of the House waited with bated breath to see how that word "shall" was to be made legitimate. But in another place the Government amendment was to delete the word "shall" and to insert the word "may"—a stroke of breathtaking ingenuity, which rendered totally redundant the amendment which the Government and the Opposition accepted on 7th July.
  Moving the Government amendment. Lord Wells-Pestell said:
  "The amendments put into an appropriate form amendments made in another place which, although acceptable in principle to the Government, were technically defective."
  However, their Lordships were not so gullible as to fall for this, and Baroness Elles said:
  "I feel that the amendment does not seem to be quite in the spirit of the reply given in

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  another place that 'shall' is to replace 'may' in the Bill…"
  Lord Banks agreed and Lord Wells-Pestell was under some pressure—
  Mr. Deputy Speaker: Order. Is the hon. Gentleman quoting what was said in another place?
  Sir G. Young: Yes.
  Mr. Deputy Speaker: I am afraid that the hon. Gentleman has come to the end of his quotation because Ministers only may be quoted from another place.
  Sir G. Young: Lord Wells-Pestell is a a Minister in another place.
  Mr. Deputy Speaker: The hon. Gentleman referred to Baroness Elles.
  Sir G. Young: I apologise for inadvertently quoting someone whom I should not have quoted. I will endeavour to complete my oration without relying on my hon. Friends.
  Lord Wells-Pestell, who is in the unhappy position of being a Minister, said:
  "I am advised that it is much more appropriate to use the word 'may' than the word 'shall'. I recognise the force of 'shall', but we are advised that' may' is the more appropriate word."—[Official Report, House of Lords, Vol. 363, c. 535–8.]
  With all respect to the noble Lord, that is hardly a compelling argument. In both Houses we have been told that "shall" is technically defective but we have never been told why. The Government must do better today than merely say that "shall" is defective. If one goes through the Bill I doubt whether one finds any word appearing quite so often as the word "shall", apart possibly from the word "regulations." I accept that another amendment inserted in another place, namely Lords amendment No. 2, is relevant to our deliberations. This amendment says:
  "The power to prescribe different rates under subsection (2) shall be exercised as to bring different rates into force on such day as the Secretary of State may by order specify."
  This, however, is not good enough because the power referred to is permissive and not mandatory. We on this side of the House find ourselves in the strange position of defending an amendment which the Government accepted three weeks ago from one of their own back benchers. We are happy to have this opportunity, and we propose to resist Lords amendments Nos 1 and 2.
  The Minister of State, Department of Health and Social Security (Mr. Brian O'Malley): I assume from the comprehensiveness of the hon. Gentleman's speech that he is practising to write the definitive biography of the new leader of his party. I think, however, that we should be grateful for his putting on the record in considerable detail the history of this affair.
  All I would say is that, of course, it is the case that "may" is replaced by "shall" in Lords amendment No. 1. On the other hand, the word "shall" appears clearly in Lords amendment No. 2. The total result of all the amendments which we are discussing is to provide in proper legal form everything which my hon. Friend was putting forward in his amendment. We have, therefore, given the assistance of the Government draftsman to ensuring that this Bill, when it completes its parliamentary process, should be in the correct legal language. Nothing has changed except drafting since the Bill was in another place, and I do not know what the hon. Gentleman is making such a fuss about.
  Question put, That this House doth agree with the Lords in the said amendment:—
  The House divided: Ayes 261, Noes 251.
  Question accordingly agreed to. [Special Entry.]
  Lords amendment agreed to: No. 2, in page 3, line 31, leave out from "otherwise" to the end of line 32 and insert:
  "(2A) The power to prescribe different rates under subsection (2) above shall be exercised so as to bring different rates into force on such day as the Secretary of State may by order specify."—[Mr. Meacher.]
  [Special Entry.]

New Clause A

  REPAYMENT AND DISQUALIFICATION
  Lords amendment proposed: No. 1, in page 2, line 27, at end insert new Clause A—
  "A.—(1) In any case to which section 1 of this Act applies the district auditor shall at the same time as he makes the certificate referred to in subsection (2) thereof make a further certificate stating the sum or sums which and the person or persons whom he would have surcharged under each of paragraphs (b), (c) and (d) of section 228(1) of the Local Government Act 1933 but for this Act.
  (2) Within 28 days of making the certificate required under subsection (1) above the district auditor shall apply to the court for such order or orders as the court may think fit to make as hereinafter provided in respect of the said certificate and against any person or persons named in it.
  (3) On an application under subsection (2) above the court may confirm, vary or quash the said certificate and, if it confirms or varies it, may—

  (a) order that any person named in the said certificate as confirmed or varied shall pay to the council which incurred the expenditure or suffered the loss or deficiency in question, or to its successor council, such part as the court thinks fit but not exceeding £1,000 of the sums for the expenditure or loss or deficiency of which such person was responsible as certified therein; and

  (b) subject to subsection (4) hereof whether or not it makes an order for the payment of any part of such expenditure or loss or deficiency if the total thereof exceeds £2,000 and any person responsible for authorising or incurring it is or was at the time of his so doing a member of a local authority shall order him to be disqualified for being a member or elected to a local authority for a period of five years unless there are special circumstances connected with the relevant transactions to be specified by the court which in the opinion of the court justify the remission of the whole or part of any such disqualification.

  (4) The court shall not make an order under subsection (3)(a) or (b) above if the court is satisfied that the person authorising or incur ring the expenditure, loss or deficiency in question acted reasonably or in the belief that his action was authorised by law, and in any other case, before making an order under subsection (3)(a) above, shall have regard to all the circumstances, including that person's means and ability to pay and the degree to which in the opinion of the court he was guilty of wilful default.
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  (5) Any person in relation to whom an order may be made in proceedings under any of the foregoing provisions of this section shall be entitled to appear and be heard in such proceedings.
  (6) The courts having jurisdiction for the purposes of this section shall be the High Court except that, if no sum specified in the certificate given under subsection (1) above exceeds the amount over which county courts have jurisdiction in actions founded on contract, the county court shall have concurrent jurisdiction with the High Court.
  (7) Any expenses incurred by a district auditor in complying with the foregoing provisions of this section shall so far as not recovered from any other source be recoverable from the local authority from the audit of whose accounts such expenses arose or from the council which is the successor to that local authority."
  Read a Second time.
  6.51 p.m.
  Mr. Ian Percival: I beg to move, as an amendment to the proposed Lords amendment, at end of new Clause A add:
  '(8) Any person who has been surcharged in respect of an item of account or a loss or deficiency attributable to a council's failure to implement the Housing Finance Act 1972 may make an application to the court in respect of the said surcharge and the provisions of this section shall apply to the said application and to the powers and duties of the court in respect of it as if it were an application made under this section in respect of a certificate to which it applies'.
  It is my privilege to move this important amendment, which raises questions going to the heart of the problem with which we are all trying to deal. I stress the words "all trying to deal" as we are attempting to find a sensible solution to this question. Its direct effect applies only to the 11 Clay Cross councillors who have already been surcharged once for the sum of £6,985. That is important. I hope to show that this amendment will put those councillors in a better position than any of the alternatives open to them under the Bill.
  The amendment raises an even more important questions of principle first that everyone should be treated in the same way. That is a most important question. Secondly, although we agree that justice should be tempered with mercy none of us should tamper with the rule of law or put it at risk. All people who offend the law, as these people have offended, should be treated alike. No hon. Member would quarrel with that proposition. Indeed, everyone would pay lip service to it so let us see whether that is so with

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  the Bill. That involves a two-stage process—first to discover who is affected by the Bill and secondly whether those who are affected are being treated alike.
  Let me first look at who is not affected by the Bill. No councillor who acted reasonably—for instance, those who applied under the Newcastle amendment and who, whilst waiting for answers, did nothing—has anything to fear from the existing law or has any need for this Bill. No one who believed that his actions were authorised by law has anything to fear from the law or has any need for the Bill. That was demonstrated clearly by my hon. Friend the Member for Southend, West (Mr. Channon) on Second Reading, who mentioned three councils which were late in implementing the Act, but which, as they were acting reasonably, and as they believed that what they were doing was authorised by the law, were not even surcharged.
  Mr. Paul Channon: What my hon. Friend says is accurate. Two of the councils to which I referred wrote to the Secretary of State to tell him that it was not their intention to implemen the Act. Even in those circumstances the district auditor did not decide to surcharge them.
  Mr. Percival: I am obliged to my hon. Friend.
  Despite those facts it appears that the Government had to accept that there were people who could neither show that they had acted reasonably nor that they believed they had acted within the authority of the law. On Second Reading, the Secretary of State said:
  "A number have convinced the district auditor that there were reasonable grounds for their delay: a fact which underlines what I said earlier—that authorities were in genuine difficulties over implementing the Act."
  Those are some of the cases to which my hon. Friend referred. He went on:
  "But in the remaining cases—a score or so—the district auditor may well find that the rent losses were due to misconduct, and that it is therefore his duty to surcharge the councillors involved."—[Official Report, 24th March 1975, Vol. 889, c. 38.]
  It is only those councillors who, in the words of the Father of the House, the right hon. Member for Vauxhall (Mr. Strauss), said:
  "To hell with the law, to hell with Parliament."
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  Those are the only people who need the protection of this Bill. He rightly went on to say:
  "Under the circumstances, I do not see why Parliament should show any clemency towards these people. If it did, it would set a serious precedent for the future."—[Official Report, 24th March 1975, Vol. 889, c. 83.]
  This is the answer to my first question of who is affected by the Bill and who needs the Bill. It is only the people who said "To hell with the law, to hell with Parliament" and who openly defied the law.
  Now for the second part of the comparison. Are all those people being treated alike? Under Clause 4, the 11 who have been identified are let off three of their five years' disqualification. But they receive no financial relief. The right hon. Member for Vauxhall said that that was wrong and that they should not be let off three of their five years' disqualification. I agree. This is not a matter where Parliament should simply let off those people.
  However, the effect of Clause 1 was much worse until the new clause, which is the subject of the first amendment, was added in the other place. For the effect of Clause 1 was as follows.
  An unspecified number of councillors—being about 400—and unidentified as to the councils involved, were to be relieved of all penalties, financial and otherwise. They were men and women who had taken the oath to carry out their duties according to law and spat in the face of it. They were guilty of misconduct. They could not claim that what they did was reasonable. They could not say that they believed their actions were authorised by law. Even at this late stage the House must realise that what was proposed under Clause 1 was infinitely worse than what was proposed under Clause 4, and that the people affected by the Bill were not being equally treated. These 400 unidentified, and, I suspect, important, people were treated much better than the 11 people from Clay Cross who are being let off three years' disqualification. That seems bad enough, baldly stated like that. But when we realise that Clause 1 implemented Labour Party conference resolution 191 in full, except in the case of the 11 Clay Cross councillors, we also realise how disgraceful was this exercise until the other place improved the Bill

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  by adding the new clause—to which my amendment would add yet a further advantage.
  For a long time the Secretary of State managed to distract attention by playing on the fact that the Clay Cross affair was news. For a long time many people, including Members of Parliament, believed that Clause 4 mattered most, simply because the people to whom it referred were news. Thank goodness all of that has been exploded, first in Committee, secondly by my right hon. and noble Friend Lord Hailsham, leading for the Opposition in another place, and by Lord Wigoder, leading for the Liberals in another place. Now we see two things without a shadow of doubt. First, all those who offended and are affected by the Bill are not being treated in the same way. Secondly, the real evil of the Bill lies in Clause 1 and not in Clause 4.
  7.0 p.m.
  I come now to the next stage of the argument. In the Second Reading debate the Secretary of State at least had the good grace to say that he did not suggest that his Bill was perfect. That is the understatement of the century. He invited us to say how we would deal with the situation. I think that he will be good enough to acknowledge that he did not have long to wait for the answer to that question.
  In Committee in our first amendments we put forward a method which has received at least some commendation from the other side of the House. The Secretary of State and the Attorney-General were good enough to say that they recognised that it was an attempt to put forward a constructive alternative. The hon. Member for Liverpool, Toxteth (Mr. Crawshaw) thought that there was a good deal of sense in it and the hon. Member for Islington, North (Mr. O'Halloran) thought that it would be as good as a permanent improvement in the law relating to surcharges. That method was examined in detail in Committee and pursued on Report in this House. Unhappily, it was rejected out of hand. Now the other place has given us a chance to reconsider the position, thus demonstrating yet again both how fortunate we are to have a revising House and what nonsense the hon. Member for Holborn and St. Pancras, South (Mrs. Jeger) must
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  sometimes talks if the Daily Telegraph report is accurate.
  Having added the new clause to which the amendment is moved, the other place went on to move a new clause which would have extended to the Clay Cross councillors the benefits of the clause that it had just carried. That offer was spurned by the Government and not pursued in the other place. We are pursuing it in this amendment.
  My case on the amendment is immensely powerful and may be summarised thus. It offers the House a chance to do four things which we must do if we place any value the trust reposed in us as elected Members of this House. We must uphold the rule of law, temper justice with mercy, treat all those who offended in precisely the same way and take the whole matter out of party politics. We can achieve all four by passing the amendment and agreeing with the other place in the first amendment which we shall then go on to consider.
  It is a two-part exercise because the new clause has to stay if the amendment is to have an effect. I hope that the House, having decided to make this amendment, will decide to keep that new clause, but that is the subject of the next debate and my hon. and hon. and learned Friends will be dealing with it in detail so I shall confine myself to this amendment.
  But I must refer to some words attributed to the Secretary of State and reported in the Daily Telegraph of last Thursday, and I am sure he will tell me if they are inaccurate. He is reported as having said of the new clause and what the other place had done:
  "'Their object is to wreck the Bill and preferably to wreck the Labour Party as well', Mr. Crosland alleged. 'Those 400 councillors would be dragged one by one through the courts. Many would suffer heavy fines and most would be disqualified. We should be forced into a series of by-elections on grounds of our opponents' choosing, and some of the best Labour-controlled local authorities in the country would be decimated in the process. That is what their Lordships want to see.'"
  The Secretary of State does not deny having said that, but I remind him that we do not even know the names of the councils concerned, let alone the councillors. He and his Government will not tell us the councils, they will not tell us how many are affected and they will not tell us the names of the councillors. How

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  nonsensical can he get? How can the right hon. Gentleman possibly suggest that we are trying to force the Government into a series of by-elections on grounds of our choosing when we do not even know the names of the councils?
  Does not this perhaps lift the corner of the rug a little and give us an insight into what is happening underneath? Is the real fact of this matter that many important Labour councillors would be disqualified if our amendment were accepted, and is that why the Secretary of State is so anxious, first, to put up a smokescreen to distract attention from such an unworthy motive and, secondly, to ensure that these important people do not risk any penalties? It certainly looks like it.
  Looking back on it, one wonders whether that is not what the Attorney-General had in mind when in the Second Reading debate he said:
  "We believe that the Government could not have waited longer, and that we now have enough information to enable and require us to take action to avert"
  these are the important words—
  "great potential damage to local authorities".—[Official Report, 24th March 1975; Vol. 889, c. 157.]
  It looks now as if what the Government had in mind was that some important Labour councillors would cease to be councillors because they could not say that their actions were reasonable or that they believed that their actions were authorised by law; because they would have to admit that they had said "to hell with the law and to hell with Parliament".
  That raises suspicions which give rise to many questions. Are we not perhaps witnessing the most squalid exercise in rescuing political friends that can ever have been seen in this country? Are we not perhaps witnessing the most squalid example of a Labour Cabinet taking instructions from its party conference and, to make it worse, pretending that that is not the case? Would they have done this but for Resolution 191? Except for the Clay Cross councillors what they are doing is exactly what resolution 191 enjoined them to do, except that they are not carrying it out in full in respect of the Clay Cross councillors.
  And the hon. Member for Toxteth will forgive me for borrowing a question he asked: would they have done this if the offending councillors had been Conservatives
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  and not Socialists? Of course they would not. If they had gone as far as we have gone in our new clause, they would have been boasting how generous they had been to those Conservative councillors. Let us have an end to humbug. Let us have some straight talking in this matter.
  I suggest that this amendment ought to appeal both to those who are most closely concerned with the Clay Cross councillors and to the Secretary of State. The amendment should appeal to the Clay Cross councillors and their friends, first, because it is considerably better for them than are any of the other courses of action and, secondly, because it ensures that they are treated on the same footing as everyone else. Whatever the basis, why should not they be treated on the same footing?
  Let me demonstrate these two points by a quick look at the three choices, which are that Clause 4 stays, Clause 4 goes and that this and the Lords amendment stand. If Clause 4 stays, no, if Clause 4 goes, these people are thrown to the wolves. They get no relief at all. That looks as though it will happen unless our amendment is accepted. That would ensure that they were treated like everyone else.
  If Clause 4 stays, each of these people will still be liable for a sum of £5 short of £7,000. I hope that no one imagines that it is as easy as Mr. David Skinner is reported to have suggested today. I do not know whether the report is accurate, but he has been reported as saying that he was not going to pay, that he would give up his job and go on social security, and that people could go hang for their money. I do not suppose he said that, but if he did say it and people imagine that it is as easy as that, they have it wrong. It is a serious matter for anyone to be under liability to pay that amount of money because the law will catch up with him in the end.
  The third choice is to carry our amendment and leave new Clause A in the Bill. What then would be the position of the Clay Cross councillors? First of all, they would have the benefit of this provision like everyone else. Their liability would immediately be limited to £1,000. It need not be that much, because we say that in deciding how much each person should pay, up to a maximum of £1,000, the court should have regard to the means of each

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  person. That is surely a sensible suggestion.
  Mr. Thomas Swain: Is the hon. and learned Gentleman suggesting that the case would be taken jointly or severally, with a maximum of £1,000 altogether? Or would the liability be £1,000 individually? If he means the latter, the Clay Cross councillors would be called upon to pay more than they are being called upon for now.
  Mr. Percival: It does not mean that. I assure the hon. Gentleman of that if he is bothered about it. The £1,000 would be a maximum, and if the amount at issue was, say, only £500, no one would be ordered to pay more. The court would have regard to the means of the parties, as it should be able to, and could therefore ensure that these gentlemen, who were grievously misled by their own leaders who should have known better, and were egged on to do things which they might not otherwise have done—that might be a good case of mitigation before the court—paid no more than their means allowed. They could speak for themselves, or get someone to do so, and ask for their liability to be limited to a modest sum.
  It is incontrovertible that our proposal would give them a better chance of limiting their liability than either of the other alternatives. Furthermore, the court could let them off some of the disqualification if satisfied, on being asked to do so by them or their counsel, that there were grounds for doing so. I do not think that anyone could quarrel with the proposition that they would as individuals be in a better position, if the amendment were carried and new Clause A remained in the Bill, than they would be either if Clause 4 remained or if Clause 4 went.
  The other thing is that they would then be on the same footing as everyone else. Of course, to gain that benefit hon. Members opposite have to vote for the amendment and new Clause A. But why should not these other people be under the same potential liabilities as the Clay Cross councillors? In one go, we could put everyone on the same footing. I suggest to the hon. Member for Derbyshire,
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  North-East (Mr. Swain) and his hon. Friends, who are very closely connected with this matter, that it would be very much in the interests of those for whom they have fought for so long to join us in taking these steps.
  7.15 p.m.
  I suggest that this proposal ought also to appeal to the Secretary of State because, on Report, as well as before, he made such a point of wanting a Bill that was consistent. On Report, he said:
  "The crux of the matter is that we should have been inconsistent and unfair had we lifted the threat of disqualification from all the other councillors while allowing the Clay Cross councillors to stay disqualified for failing to implement the Act."
  Later, he said:
  "We see this"—
  Clause 4—
  "not as an act of mitigation, or as a matter of whether the Housing Commissioner should have gone in earlier. We see it in terms of making the Bill consistent and fair, taking the Bill as a whole, as between all councillors—the 400 or so who have declined to implement the provisions of the 1972 Act."
  He went on:
  "I must maintain parity of treatment between those many councillors and the Clay Cross councillors who have been surcharged already."
  Finally, he said:
  "I ask for parity and equity of treatment between all those who failed to implement the Act, whether the surcharge had been made—as it was in the case of Clay Cross—or whether it had not been made, as was the case in all the other places."—[Official Report, 14th May 1975; Vol. 892, c. 564–593.]
  That is exactly what we offer the right hon. Gentleman by our amendment and new Clause A. It is the only way in which he can have that which he has said he wants. It is the way in which he could have his Bill on a basis which he has said is to him the fundamental basis that he wants to achieve.
  We are not unaware of the political pressures being put upon the right hon. Gentleman. I do not underestimate the personal courage which would be required to rebuff those who are engaged in the squalid, outrageous political manoeuvrings which lie behind all this. But I say to the right hon. Gentleman from my heart, if he has any respect for this House, if he has any respect for parliamentary democracy, and if he has any respect for the rule of law, let him now

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  prove it by recommending his hon. Friends to accept the amendment.
  Mr. Richard Crawshaw: I do not propose to speak at length because most of the points I would have made have been made by the hon. and learned Member for Southport (Mr. Percival). I was desirous of putting this amendment down myself, but found it had already been tabled by the Opposition, and I did not know whether my name to it would give it added lustre or detract from it, so I left it as it was.
  I have opposed most of this Bill from the inception, primarily because I believe that if we are to mete out justice we have to do it through the recognised courts. We know that the councillors about whom we are concerned were under tremendous pressures from all sorts of organisations. We can understand how some of the councillors acted as they did. I believe that many of them acted in that way because they were misled by people in my party who should have known better and should have set a better example. I believe that, not in so many words but by nods and winks, many people were encouraged to break the law. Therefore, if these provisions go through such matters will be taken into consideration.
  It is ironic that a Bill which has come to be called the "Clay Cross Bill" did something for almost all councillors except the Clay Cross councillors. Those councillors would have had to pay the surcharge and automatically would have been made bankrupt eventually, and indeed would have been disqualified from ever being councillors again.
  Mr. Swain: I believe my hon. Friend is a lawyer, and if he has studied the Local Government Act 1933 he will know that there are two ways in which an auditor can collect a surcharge. First, he can go to the magistrate's court for a distress warrant against goods and chattels, and, secondly, he can go to the county court for an order of attachment. That piece of legislation appears to make my hon. Friend's argument this evening quite worthless.
  Mr. Crawshaw: I disagree with my hon. Friend. Ultimately a person can be made bankrupt to enable him to pay what is required. In those circumstances he would be disqualified from sitting on a
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  council. Therefore, the provision gives nothing to the Clay Cross councillors whatever.
  I have always said that we should mitigate the punishment against these people, provided that this can be done through a court of law and not by an arbitrary decision taken by the Government Front Bench. That is the element to which I have objected throughout the Bill. If we are asked to use the poor box to help these people, I would be the first to agree—again provided that these matters are handled through the courts of law rather than by my party sitting here in Government.
  Furthermore, I believe that all those people who have disobeyed the provisions of the Housing Finance Act should be put on the same plane. There are two categories of people concerned. I am surprised that there are so many of my hon. Friends who are prepared to see the Clay Cross councillors take a secondary position compared with other councillors. The Clay Cross councillors are to bear the whole brunt, whereas the others will get away 100 per cent. free. It is just not logical.
  I urge my hon. Friends, particularly those who have fought so hard for the Clay Cross councillors, to consider this matter very carefully. Under the provision as it stands, there will be 100 per cent. exemption for some councillors and the others will have to pay the surcharge.
  Mr. Dennis Skinner: Your arithmetic is wrong.
  Mr. Crawshaw: My arithmetic may be wrong, but the councillors concerned will find great difficulty in finding the money with which to bear the surcharge. However, under the amendment the maximum would be £1,000.
  Mr. Skinner: Your mathematics are still wrong.
  Mr. Crawshaw: If we pass the amendment, the Clay Cross councillors will have the possibility of having their cases heard again by the High Court and they could be put in a position were they would be surcharged not more than £1,000.
  Mr. Skinner: I do not quarrel with my hon. Friend in seeking to make the situation as clear as he can, but the fact is that on a purely arithmetical basis the

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  11 Clay Cross councillors currently are charged a figure of about £8,000, with accrued interest, compared with the previous surcharge of £7,895. Among 11 councillors that represents less than £1,000 apiece. In seeking to act—I believe misguidedly—in the best interests of those he is trying to help, my hon. Friend is suggesting that £11,000 is less than £8,000. I just cannot believe it.
  Mr. Crawshaw: As I understand the situation, the figures are much higher than that and each councillor is personally liable for the whole amount. That is the difference.
  Mr. Mark Carlisle: Does the hon. Gentleman agree that in the present situation the auditor could choose to proceed against each individual councillor for the whole £7,000, whereas under the clause they would be limited to a maximum of £1,000 at the most?
  Mr. Crawshaw: That is exactly the point I was seeking to make to my hon. Friend the Member for Bolsover (Mr. Skinner). If my hon. Friends who wish to support the Clay Cross councillors cannot support the amendment, I believe that there must be some other reason for so doing which I cannot possibly understand.
  Mr. Skinner: It is the question of the money.
  Mr. Crawshaw: If my hon. Friend the Member for Bolsover allows me to proceed without interruptions, I am sure that my hon. Friend will have time to make his speech later. I repeat that if my hon. Friends do not support the amendment, they are depriving the Clay Cross councillors of the opportunity of being dealt with in the same way as any other councillor.
  I wonder what answer my hon. Friends will give when they attend this year's Labour Party conference when they are told that the provision mentions Clay Cross councillors only. Nobody knows who are the others affected, but they are the people over whom apparently the fight has taken place. I can only assume that my hon. Friends wish the Clay Cross case to be used as a source of discontent within the party and the country. I can see no other reason.
  It is hardly likely that any of the councillors, in view of their financial position,
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  will be surcharged anything like £1,000. Mitigating circumstances will be put forward and again it is unlikely that they will be disqualified for a period of five years.
  Mrs. Lena Jeger: I am confused about the present situation and I would ask my hon. Friend to help us. One councillor who goes before the court may be a careful, modest-living man, who has some small savings for his old age and who might even have £1,000 in the Post Office. On the other hand, another councillor before the court might be a person who has lived it up over the years and he may be able to prove to the court that he is up to his ears in hire purchase, that his wife owns the family house and all the rest of it. How will the court act in those two entirely different cases? Surely the provision will give the court an impossible judgment to arrive at.
  Mr. Crawshaw: I do not agree that it will put the court in an impossible situation. As I know the courts, they pay high regard to a person's financial situation. If people are out of work and come before the court, it is likely that there will be no surcharge at all. I must emphasise that I am not seeking to exonerate the councillors completely from the law, but I am seeking to ensure that the situation is fair as between the Clay Cross councillors and the other councillors who would get away with it totally. If my hon. Friends have any regard for the Clay Cross councillors, they will support this provision. I must inform them that when it comes to the vote, I shall support both the amendment and the clause.
  7.30 p.m.
  Mr. Swain: It will only take me two minutes to put my hon. Friend the Member for Liverpool, Toxteth (Mr. Crawshaw) straight. He attended the meeting on Thursday night, and a collective decision was made. My hon. Friend saw fit to criticise the Tribune Group last week, but this week he has issued his own whip and sent round to hon. Members, including myself, who represent Clay Cross, a copy of his letter. If my hon. Friend wants the Clay Cross councillors to be served as the other 400, or conversely the other 400 to be served as the Clay Cross councillors, he should have tabled an amendment to the Lords amendment asking my right

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  hon. Friend to guarantee protection under resolution 191 of the conference. In that way everyone would be granted immunity.
  The Clay Cross councillors are suffering. My hon. Friend the Member for Toxteth has done his arithmetic all wrong, as has the hon. and learned Member for South-port (Mr. Percival). Only a few weeks ago the Conservatives were castigating the Clay Cross councillors but now they are appealing to the Clay Cross councillors in order to get sympathy for their own case. I know that hypocrisy is an unparliamentary word.
  Mr. Percival: With respect, the hon. Member for Derbyshire, North-East (Mr. Swain) has entirely overlooked the wording of the new clause. [Interruption.] I hope that the hon. Member for Bolsover (Mr. Skinner) will, if he so wishes, make a speech, instead of coming in late when the point has been explained and sitting moaning and wailing like I do not know what.
  The hon. Member for Derbyshire, North-East has overlooked the fact that in the new clause the total amount to be surcharged on the eleven councillors cannot exceed £6,985 because the only amount that any of them can be ordered to pay is a part of the deficiency—they cannot, between them, be ordered to pay more than the total deficiency. That is a fact. If the hon. Gentleman had overlooked that point, I quite understand, and I quite understand if the Member for Bolsover had not understood. Can we now debate this matter on the right facts with the right approach instead of having a very specious argument like the present one?
  Mr. Swain: That is a hell of a lot more money and I understand that the hon. Member for Toxteth also agrees. The Clay Cross councillors were surcharged after six weeks and the surcharge worked out at £6,985 each—jointly or severally. As a consequence of this amendment, that six weeks' surcharge, which is now the subject of perhaps a bankruptcy order, will carry on automatically until it becomes £1,000 per member, again jointly or severally, under the amendment. There was a deuce of a lot of money outstanding at Clay Cross. [Interruption.] The hon. Gentleman is trying to marry two male prostitutes, and
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  they will not have it. He is trying to convince me and my hon. Friend the Member for Bolsover (Mr. Skinner) that this is quite a reasonable thing to do. [HON. MEMBERS: "Withdraw."]
  I apologise to the male prostitutes. Under this amendment even the Clay Cross councillors would be worse off financially because of the continuation of the amount up to £1,000. [An Hon. Member: "Rubbish."] It is not rubbish. I was the leader at Clay Cross. I take the whole responsibility. The right hon. Gentleman who was the Minister at that time was so crooked in his ministerial post that if he swallowed a nail he would part with a corkscrew on that particular issue. He surcharged and sent in the auditors after six weeks. That is why Clay Cross has been the centre of the issue. However 400 councillors will get the benefit, indeed 411 including Clay Cross.
  I am not satisfied with the amount of benefit Clay Cross is receiving. I am not on speaking terms with my right hon. and hon. Friends on this issue, because my right hon. Friend should have implemented resolution 191 regardless. He should not have come to the House, having had a dream in the night, and then changed it all round to make it look beneficial to 400 but throw 11 on the sacrificial altar. I see that my hon. Friend the Member for Toxteth agrees with me on that point. He will march for charity, but not for Socialism. I shall march for Socialism.
  I appeal to the House to support the Government. The amendment must be rejected tonight.
  Mr. Peter Rees: I think that the most I can say about the hon. Member for Derbyshire, North-East (Mr. Swain) is that his loyalty to his erstwhile comrades is touching but his grasp of the constitutional and legal implications of the Bill and the amendment is rather slight.
  The House has been round this course before. There is now an extra dimension to our debate. On the first occasion we were concerned with the position of district auditors, the maintenance of at least some standards in local government, the position of ratepayers as a body as opposed to council house tenants, and

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  the retrospective condemnation of flagrant breaches of the law. Finally, and perhaps not least importantly, we were concerned with the constitutional position of the Attorney-General.
  We are now being asked by the Government to override the carefully argued, thoughtfully expressed, views of another place. The Labour Party, having emasculated the second Chamber and flouted practically every constitutional convention, is naturally concerned to railroad through this Bill. However, it has, by its actions, demonstrated a clear need either for a stronger upper House or for some entrenched provisions, such as a new Bill of Rights. These possibly are some of the principles which we should be canvassing tonight in the various debates which I hope we shall have.
  There used to be a strong antipathy in the country to the dispensing power exercised by the Crown. There is equal antipathy to a dispensing power exercised by a highly partisan, if rather ephemeral, parliamentary majority. Those who compose it seem more concerned with one particular class of ratepayers than with the whole body of ratepayers. I had hoped that the other place, which by convention is how I must describe the House of Lords, had perhaps let the Secretary of State off the hook. I pay the right hon. Gentleman the compliment and tribute that I suspect that his heart is not in this work. I am sorry that he feels obliged to return to the House and go over this rather muddy course again. I hope that he will pay great attention to the views expressed by the Opposition. Surely he must agree that it would be better for the matters canvassed in the clause to be determined in the calmer, more dispassionate atmosphere of the courts rather than in the fevered atmosphere of this Chamber in August.
  I cannot say what the outcome in the courts would be, but I remind the House that there was an escape route open to the Clay Cross councillors under the Local Government Act 1933. They could have taken that route and appealed against their disqualification on the basis that they had reasonable grounds for acting in the way that they did. However, surprisingly enough they did not choose to take that course, and they cannot
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  now complain that they did not have proper legal advice, because by a curious coincidence they were represented on that occasion by the hon. Member for York (Mr. Lyon). Therefore, perhaps the hon. Member can tell the House why they are so sceptical of their chances in a court of law under this amendment.
  Mr. Swain: I could tell you.
  Mr. Rees: It could be that the hon. Gentleman will tell us, because he has told us that he accepts full responsibility for what went on.
  Mr. Swain: I am not afraid. It has happened to me before.
  Mr. Rees: If the hon. Member wishes to intervene, I will gladly give way.
  Mr. Swain: I have been down that same road before. I was in No. 8 cell in Winson Green Prison. It was the first time in my life that I got three meals a day.
  Mr. Rees: I suggest to the hon. Gentleman that in his present position he should be a little more scrupulous about observing the laws in this place introduced and passed—[Interruption.] The hon. Member for Bolsover (Mr. Skinner) can make his point, if he dares, later in the debate. I am concerned with the hon. Member for Derbyshire, North-East. No doubt we are all touched by his reminiscences about his earlier happenings in his career. He say that he takes full responsibility for what happened at Clay Cross. As he says that he takes full responsibility for what happened at Clay Cross, let him pay the surcharge.
  Mr. Swain: At any rate I am not a crooked lawyer.
  Mr. Rees: Who is the hon Gentleman suggesting is a crooked lawyer? Would the hon Gentleman care to stand up and say who he suggests is a crooked lawyer?
  Mr. Swain: I am afraid the hon. and learned Member for Dover and Deal (Mr. Rees) is going to burst a blood vessel in a moment. If the cap fits, he can wear it.
  Mr. Deputy Speaker (Mr. Oscar Murton): I am afraid the cap will not

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  fit. That was an unparliamentary expression. The hon. Member for Derbyshire, North-East (Mr. Swain) must withdraw it. It is desirable to keep the temper of the House down, if possible.
  Mr. Swain: Is it only the hon. and learned Member with the massive head of hair who is going to have your protection, Mr. Deputy Speaker? Am I not to be given any protection against his bit-tongue? These are the only speeches that the hon. and learned Member for Dover and Deal (Mr. Rees) makes for nothing.
  Mr. Deputy Speaker: Most certainly I will give the hon. Member for Derbyshire, North-East the protection of the Chair when it is necessary. Can we proceed with the debate in an even temper? [HON. MEMBERS: "Withdraw."] The hon. Gentleman must withdraw his remark.
  Mr. Swain: It is often said by Mr. Speaker that he is conveniently deaf. I notice that you, when I stand up to speak, are occasionally short-sighted, Mr. Deputy Speaker. Nevertheless, I withdraw the words that I used and I apologise to every crooked lawyer in this country for bringing him down to the level of the people who sit on the opposite side of the House to me.
  Mr. Deputy Speaker: I am obliged.
  Mr. Rees: I accept the hon. Gentleman's withdrawal but not his apology.
  Our sympathy should perhaps go out to the Secretary of State because of the company he keeps today. Perhaps the saddest aspect of this whole case is the way that the Labour Party treats some of its most distinguished spokesmen.
  I am paying this tribute by design to the Secretary of State and the Attorney-General. We know that they left Oxford and the law school with ideals of pride and with thoughts high, with the intention of providing the Labour Party with a new philosophy and perhaps the laws of England with a new coherence. What has happened to them after a lifetime of devoted service to the Labour Party? They have become creatures—puppets—of the hon. Members for Bolsover and for Derbyshire, North-East and their Tammany associates. They will pass into
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  history as the refuse collectors of Clay Cross. For the sake of their reputation as well as for the country's sake, I hope that we shall uphold the Lords amendment tonight.
  7.45 p.m.
  Mr. Stephen Ross: If I may seek to lower the tone a little, I, as a fairly new Member of the House, should like sincerely to congratulate the hon. Member for Liverpool, Toxteth (Mr. Crawshaw), who made a brave and honourable speech. That should be made clear from this side, certainly from this bench.
  I also wish to pay tribute to the Lords amendment, which is understandable, compassionate and fair. I served on the Standing Committee and listened to innumerable arguments between lawyers for many hours, but at the end of it all I did not understand half of it. I understand these arguments and I understand the argument which took place in the other place between the noble Lords. They have their priorities right. They have it right in Clause 1. Therefore, these Lords amendments should be approved by the House tonight.
  I go one step further. Having read all about Clay Cross and taken an interest in it and listened to the speech made on Second Reading by the hon. Member for Bolsover (Mr. Skinner), I understand some of the idealism of the councillors of Clay Cross. I do not support what they did, but I understand them and their frustrations. I shall be supporting these Lords amendments, but I listened to the speech of the hon. Member when the Bill was first introduced to the House and I have some feeling for his case. I have told him so.
  I understand the way in which in poorer areas of the country councillors have desperately wanted to do something better. One cannot as a councillor ever support what they did. Why should not this be spread right across the board? Why should the Clay Cross councillors be the only ones who are thrown up in this way? If other councillors have gone against the Bill—we understand that there are 400 of them—as the hon. Member for Toxteth said, they should all be in the same boat together. That is why these amendments should be supported.
  Mr. Frank Allaun: Briefly, I should like to deal with the principle behind the objection of the three Opposition speakers who have taken part. They have used as the basis of their argument the claim that every law must be obeyed in all circumstances. I do not think that is a tenable position.
  If a Labour Government introduced a Bill to make it compulsory for comprehensive education to be introduced, do hon. and learned Members opposite argue that every Conservative councillor who refused on principle to accept that should be bankrupted? It is possible that some hon. Members would accept that, but I am not sure that all of them would.
  To take it a little further, let us suppose that a Labour Government, or indeed any Government, did something as extreme as that done by Pharaoh, who introduced the edict of the slaughter of the firstborn. There are some things so unconscionable that some hon. Members opposite would not accept them. Some of them would not have accepted the edicts of Hitler. Because some men refused to accept Hitler's laws, they lost their lives and those of their families in concentration camps.
  It may be objected that neither Pharaoh nor Hitler was the head of a democratic Government, but in this country there have been democratically elected Governments who have done things so abhorrent, so against the principles of ordinary men and women, that ordinary men and women were prepared to be sent away from their families to Australia for refusing to obey the law.
  If in Tolpuddle there had not been men prepared to refuse to accept the law which made trade unions virtually illegal, there would be no trade union movement today. The same kind of stand was made by the women of the suffragette movement and by people serving other great causes. [Interruption] Let me finish this point and I will take any questions. The hon. and learned Gentleman the Member for Southport (Mr. Percival) finished his point and would not take a question from me.
  I am saying that there are democratically elected Governments which have been resisted by men and women on matters of conscience, and they have become greatly honoured for it. I greatly
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  honour the 400 councillors in Clay Cross and in the part of the country from which I come who were prepared to risk losing their homes and possessions because they kept their pledge. They believed that to increase rents unnecessarily was wrong.
  Mr. Tony Newton: I should like to take the hon. Member back from his more recent flights of fancy to what he said about comprehensive education. I come from Essex and have made it absolutely clear that, although I shall help to fight the Government's proposals, I shall not support anybody in refusing to observe the law—or what may become the law. Am I to understand, from what the hon. Gentleman says, that if Conservative councillors' defy the law, as it may become, on comprehensive education he will be demanding their indemnification? That is what he appears to be saying.
  Mr. Allaun: I am putting the question back to the hon. Gentleman. He must answer the question. If they break the law, are they to be bankrupted? If he says "Yes", I accept that, but I go further. If there is a law introduced which the hon. Gentleman finds absolutely contrary to his conscience and belief, must he in all circumstances obey it? He may reply "Yes, I am prepared to do it and prepared to accept the consequences." Fair enough; but so were the councillors at Clay Cross. It is we who are asking for this, not they, and they are entitled to their point of view.
  The agricultural labourers of Tolpuddle are greatly honoured, but their rights were restored to them. Surely we are not doing anything wrong in wishing to restore to the councillors of Clay Cross their rights.
  Mr. Arthur Lewis: My hon. Friend has, in the course of his argument, referred to the Tolpuddle Martyrs. I remind the House that there were also the five dockers who broke the law, and it was the Conservative Government at that time who discovered an unknown Official Solicitor who was able to get them out of their difficulty.
  Mr. Allaun: My hon. Friend's remarks support the point I am making, which is simply that there are certain laws which are so repugnant that men

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  and women of conscience are prepared to break them. If some of us are ready to defend them—as I for one am—we are entitled to do so.
  The Under-Secretary of State for the Environment (Mr. Ernest Armstrong): I should first like to remind the House of the terms of the amendment which is before it. I listened with great interest and care to the speech of the hon. and learned Gentleman the Member for Southport (Mr. Percival). Quite properly, he went into some of the aspects of the clause that we shall be discussing later. I do not quarrel about that, but I should like to keep very specifically to the terms of the amendment.
  It is clear that this amendment has been moved in what I am bound to describe as a misguided and confused attempt to provide consistency. Conservative Members must recognise that their amendment is blatantly retrospective. It provides for the reopening of a case which has already gone through the courts. Indeed, the surcharge which would be reconsidered if the amendment were accepted is already the subject of bankruptcy proceedings. It is not in the least clear what effect the amendment would have on these proceedings.
  Mr. Crawshaw: There seems to be some difficulty about retrospective legislation because it has gone through the courts, but are we not in Clause 4 seeking to remove a surcharge that has already gone through the courts? I am sorry. I meant the disqualification.
  Mr. Armstrong: I should like to put the lay view in this matter because, with great respect, the lawyers get mixed up from time to time. The hon. and learned Gentleman made a specific allegation about my right hon. Friend the Secretary of State being afraid to reveal to the House and the country the names of the councils which are affected. He will know that this is a matter for the district auditor. The district auditor has yet to conduct hearings, and therefore the Government obviously cannot prejudge the issue. I can recognise that there might be a genuine wish for even treatment in allowing the courts to reconsider the disqualification which was simply an automatic consequence of the Clay Cross surcharge. But I say to the House, in all seriousness, that it would be unwise to
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  put the whole matter through the courts again after it has already been the subject of lengthy appeals.
  The amendment is muddled in content and misguided in intent. It attaches to a clause to which we are wholly opposed. Touched as I am by the concern expressed by the Opposition tonight for the Clay Cross councillors after the extravagant abuse they have used on previous occasions, I invite the House to reject the amendment.
  Mr. Timothy Raison: I was feeling sorry for the Under-Secretary of State in having to intervene in this debate. He was not involved in our earlier proceedings, and the House knows him as a decent and honest man, but I really think that the answer he has just given us a very pathetic answer indeed. I believe that he is worthy of something very much better than that.
  The hon. Gentleman produced the argument that the amendment we are discussing is a misguided and confused attempt to provide consistency. He produced absolutely no reasons at all to support that point of view. He complained only that it was blatantly retrospective, when it is obvious that the whole force of Clause 4 is retrospective.
  This debate was opened by my hon. and learned Friend—
  Mr. Swain: Clause 4 cannot be retrospective, because the people concerned have already served two years of the sentence.
  8.0 p.m.
  Mr. Raison: It is retrospective in relation to their disqualification. The debate was opened by my hon. and learned Friend the Member for Southport (Mr. Percival) with a speech which I think commanded a great deal of support from all hon. Members who are seriously concerned about this matter. My hon. and learned Friend argued the case very carefully and persuasively. His speech was followed by that of the hon. Member for Liverpool, Toxteth (Mr. Crawshaw), to whom I want to pay my respect, because he set out the issue with great clarity and dignity.
  Then the debate slid a little. I might say to the hon. Member for Derbyshire, North-East (Mr. Swain) that it is clear

  127
  that, as a result of our amendment, none of these councillors would have to pay more than under the present situation. That is clear and categoric.
  The final contribution from the back benches was the bizarre speech by the hon. Member for Salford, East (Mr. Allaun), the relevance of which was barely perceptible. The hon. Gentleman ignored the fact that the whole essence of what we were trying to do was to provide fairer treatment for the Clay Cross councillors. He might have made some reference to that which is the salient part of the case for this amendment.
  My hon. and learned Friend's case is incontrovertible. I ask the House to support it.
  Question put, That the amendment to the Lords amendment be made:—
  The House divided: Ayes 257, Noes 271.

  Division No. 318.]

  AYES

  [6.30 p.m.

  Allaun, Frank

  Bid well, Sydney

  Callaghan, Rt Hon J. (Cardiff SE)

  Anderson, Donald

  Bishop, E. S.

  Callaghan, Jim (Middleton & P)

  Archer, Peter

  Blenkinsop, Arthur

  Campbell, Ian

  Armstrong, Ernest

  Booth, Albert

  Canavan, Dennis

  Atkins, Ronald (Preston N)

  Boothroyd, Miss Betty

  Cant, R. B.

  Atkinson, Norman

  Bottomley, Rt Hon Arthur

  Carmichael, Neil

  Bagler, Gordon A. T.

  Boyden, James (Bish Auck)

  Carter-Jones, Lewis

  Barnett, Guy (Greenwich)

  Bradley, Tom

  Cartwright, John

  Bates, Alt

  Brown, Hugh D. (Provan)

  Castle, Rt Hon Barbara

  Bean, R. E.

  Buchan, Norman

  Clemitson, Ivor

  Benn, Rt Hon Anthony Wedgwood

  Buchanan, Richard

  Cohen, Stanley

  Bennett, Andrew (Stockport N)

  Butler, Mrs Joyce (Wood Green)

  Coleman, Donald

  Colquhoun, Mrs Maureen

  Jackson, Colin (Brighouse)

  Prescott, John

  Concannon, J. D.

  Jackson, Miss Margaret (Lincoln)

  Price, C. (Lewisham W)

  Conlan, Bernard

  Janner, Greville

  Price, William (Rugby)

  Cook, Robin F. (Edin C)

  Jay, Rt Hon Douglas

  Radice, Giles

  Corbett, Robin

  Jeger, Mrs. Lena

  Richardson, Miss Jo

  Cox, Thomas (Tooting)

  Jenkins, Hugh (Putney)

  Roberts, Albert (Normanton)

  Craigen, J. M. (Maryhill)

  Johnson, James (Hull West)

  Roberts, Gwilym (Cannock)

  Cronin, John

  Johnson, Walter (Derby S)

  Robertson, John (Paisley)

  Crosland, Rt Hon Anthony

  Jones, Alec (Rhondda)

  Rodgers, George (Chorley)

  Cunningham, G. (Islington S)

  Jones, Barry (East Flint)

  Rooker, J. W.

  Cunningham, Dr J. (Whiteh)

  Jones, Dan (Burnley)

  Roper, John

  Dalyell, Tam

  Judd, Frank

  Ryman, John

  Davidson, Arthur

  Kaufman, Gerald

  Sandelson, Neville

  Davies, Bryan (Enfield N)

  Kelley, Richard

  Sedgemore, Brian

  Davies, Denzil (Llanelli)

  Kerr, Russell

  Selby, Harry

  Davies, Ifor (Gower)

  Kilroy-Silk, Robert

  Shaw, Arnold (Ilford South)

  Davis, Clinton (Hackney C)

  Lamborn, Harry

  Sheldon, Robert (Ashton-u-Lyne)

  Deakins, Eric

  Lamond, James

  Shore, Rt Hon Peter

  Dean, Joseph (Leeds West)

  Latham, Arthur (Paddington)

  Short, Rt Hon E. (Newcastle C)

  Delargy, Hugh

  Lee, John

  Short, Mrs Renée (Wolv NE)

  Dell, Rt Hon Edmund

  Lestor, Miss Joan (Eton & Slough)

  Silkin, Rt Hon John (Deptford)

  Dempsey, James

  Lever, Rt Hon Harold

  Silkin, Rt Hon S. C. (Dulwich)

  Dormand, J. D.

  Lewis, Arthur (Newham N)

  Sillars, James

  Douglas-Mann, Bruce

  Lewis, Ron (Carlisle)

  Silverman, Julius

  Duffy, A. E. P.

  Litterick, Tom

  Skinner, Dennis

  Dunn, James A.

  Loyden, Eddie

  Small, William

  Dunnett, Jack

  Luard, Evan

  Smith, John (N Lanarkshire)

  Dunwoody, Mrs Gwyneth

  Lyon, Alexander (York)

  Snape, Peter

  Eadie, Alex

  Lyons, Edward (Bradford W)

  Spearing, Nigel

  Edge, Geoff

  McCartney, Hugh

  Spriggs, Leslie

  Edwards, Robert (Wolv SE)

  MacFarquhar, Roderick

  Stallard A. W.

  Ellis, John (Brigg & Scun)

  Mackenzie, Gregor

  Stewart, Rt Hon M. (Fulham)

  Ellis, Tom (Wrexham)

  Maclennan, Robert

  Stott, Roger

  English, Michael

  McMillan, Tom (Glasgow C)

  Strang, Gavin

  Evans, Fred (Caerphilly)

  Madden, Max

  Strauss, Rt Hon G. R.

  Evans, Ioan (Aberdare)

  Magee, Bryan

  Summerskill, Hon Dr Shirley

  Evans, John (Newton)

  Mahon, Simon

  Swain, Thomas

  Ewing, Harry (Stirling)

  Mallalieu, J. P. W.

  Taylor, Mrs Ann (Bolton W)

  Faulds, Andrew

  Marks, Kenneth

  Thomas, Mike (Newcastle E)

  Fitch, Alan (Wigan)

  Marquand, David

  Thomas, Ron (Bristol NW)

  Flannery, Martin

  Marshall, Dr Edmund (Goole)

  Tinn, James

  Fletcher, Ted (Darlington)

  Marshall, Jim (Leicester S)

  Tomlinson, John

  Foot, Rt Hon Michael

  Mason, Rt Hon Roy

  Tomney, Frank

  Forrester, John

  Maynard, Miss Joan

  Torney, Tom

  Fowler, Gerald (The Wrekin)

  Meacher, Michael

  Tuck, Raphael

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

  Mellish, Rt Hon Robert

  Urwin, T. W.

  Garrett, John (Norwich S)

  Mendelson, John

  Varley, Rt Hon Eric G.

  Garrett, W. E. (Wallsend)

  Mikardo, Ian

  Wainwright, Edwin (Dearne V)

  George, Bruce

  Millan, Bruce

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

  Gilbert, Dr John

  Miller, Dr M. S. (E Kilbride)

  Walker, Harold (Doncaster)

  Ginsburg, David

  Miller, Mrs Millie (Ilford N)

  Walker, Terry (Kingswood)

  Gould, Bryan

  Mitchell, R. C. (Soton, Itchen)

  Ward, Michael

  Gourlay, Harry

  Molloy, William

  Watkins, David

  Graham, Ted

  Moorman Eric

  Watkinson, John

  Grant, George (Morpeth)

  Morris, Charles R. (Openshaw)

  Weetch, Ken

  Grocott, Bruce

  Moyle, Roland

  Weitzman, David

  Hamilton, W. W. (Central Fife)

  Mulley, Rt Hon Frederick

  Wellbeloved, James

  Hardy, Peter

  Murray, Rt Hon Ronald King

  White, Frank R. (Bury)

  Harper, Joseph

  Newens, Stanley

  White, James (Pollok)

  Harrison, Walter (Wakefield)

  Ogden, Eric

  Whitehead, Phillip

  Hart, Rt Hon Judith

  O'Halloran, Michael

  Whitlock, William

  Hatton, Frank

  O'Malley, Rt Hon Brian

  Willey, Rt Hon Frederick

  Hayman, Mrs Helene

  Orbach, Maurice

  Williams, Alan (Swansea W)

  Heffer, Eric S.

  Orme, Rt Hon Stanley

  Williams, Alan Lee (Hornch'ch)

  Hooley, Frank

  Ovenden, John

  Williams, Rt Hon Shirley (Hertford)

  Horam, John

  Owen, Dr David

  Williams, W. T. (Warrington)

  Howell, Dennis (B'ham, Sm H)

  Padley, Walter

  Wilson Alexander (Hamilton)

  Hoyle, Doug (Nelson)

  Palmer, Arthur

  Wilson, William (Coventry SE)

  Huckfield, Les

  Park, George

  Wise, Mrs Audrey

  Hughes, Rt Hon C (Anglesey)

  Parker, John

  Woodall, Alec

  Hughes, Mark (Durham)

  Parry, Robert

  Woof, Robert

  Hughes, Robert (Aberdeen N)

  Pavitt, Laurie

  Wrigglesworth, Ian

  Hughes, Roy (Newport)

  Pearl, Rt Hon Fred

  Young, David (Bolton E)

  Hunter, Adam

  Pendry, Tom

  TELLERS FOR THE AYES:

  Irvine, Rt Hon Sir A. (Edge Hill)

  Perry, Ernest

  Mr. David Stoddart and

  Irving, Rt Hon S. (Dartford)

  Phipps, Dr Colin

  Mr. James Hamilton.

  96

  97

  NOES

  Adley, Robert

  Grant, Anthony (Harrow C)

  Mudd, David

  Aitken, Jonathan

  Gray, Hamish

  Neave, Airey

  Alison, Michael

  Griffiths, Eldon

  Nelson, Anthony

  Amery, Rt Hon Julian

  Grist, Ian

  Neubert, Michael

  Arnold, Tom

  Grylls, Michael

  Newton, Tony

  Atkins, Rt Hon H. (Spelthorne)

  Hall, Sir John

  Normanton, Tom

  Awdry, Daniel

  Hall-Davis, A. G. F.

  Nott, John

  Bain, Mrs Margaret

  Hamilton, Michael (Salisbury)

  Onslow, Cranley

  Baker, Kenneth

  Hampson, Dr Keith

  Oppenheim, Mrs Sally

  Banks, Robert

  Hannam, John

  Page, John (Harrow West)

  Beith, A. J.

  Harrison, Col Sir Harwood (Eye)

  Page, Rt Hon P. Graham (Crosby)

  Bell, Ronald

  Hastings, Stephen

  Paisley, Rev Ian

  Benyon, W.

  Havers, Sir Michael

  Pardoe, John

  Biffen, John

  Hawkins, Paul

  Pattie, Geoffrey

  Biggs-Davison, John

  Hayhoe, Barney

  Penhaligon, David

  Blaker, Peter

  Henderson, Douglas

  Percival, Ian

  Body, Richard

  Heseltine, Michael

  Peyton, Rt Hon John

  Boscawen, Hon Robert

  Holland, Philip

  Pink, R. Bonner

  Bottomley, Peter

  Hordern, Peter

  Price, David (Eastleigh)

  Bowden, A. (Brighton, Kemptown)

  Howe, Rt Hon Sir Geoffrey

  Prior, Rt Hon James

  Boyson, Or Rhodes (Brent)

  Howell, David (Gulldford)

  Pym, Rt Hon Francis

  Braine, Sir Bernard

  Howell, Ralph (North Norfolk)

  Raison, Timothy

  Brittan, Leon

  Hunt, John

  Rathbone, Tim

  Brocklebank-Fowler, C.

  Hurd, Douglas

  Rees, Peter (Dover & Deal)

  Brotherton, Michael

  Hutchison, Michael Clark

  Renton, Rt Hon Sir D. (Hunts)

  Brown, Sir Edward (Bath)

  Irvine, Bryant Godman (Rye)

  Renton, Tim (Mid-Sussex)

  Bryan, Sir Paul

  Irving, Charles (Cheltenham)

  Rhys Williams, Sir Brandon

  Buchanan-Smith, Alick

  James, David

  Ridley, Hon Nicholas

  Buck, Antony

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

  Ridsdale, Julian

  Budgen, Nick

  Jessel, Toby

  Rifkind, Malcolm

  Bulmer, Esmond

  Johnson Smith, G. (E Grinstead)

  Roberts, Michael (Cardiff NW)

  Carlisle, Mark

  Jones, Arthur (Daventry)

  Roberts, Wyn (Conway)

  Carr, Rt Hon Robert

  Jopling, Michael

  Rodgers, Sir John (Sevenoaks)

  Carson, John

  Kershaw, Anthony

  Ross, Stephen (Isle of Wight)

  Chalker, Mrs Lynda

  Kimball, Marcus

  Rossi, Hugh (Hornsey)

  Channon, Paul

  King, Evelyn (South Dorset)

  Rost, Peter (SE Derbyshire)

  Churchill, W. S.

  King, Tom (Bridgwater)

  Royle, Sir Anthony

  Clark, Alan (Plymouth, Sutton)

  Kirk, Peter

  Sainsbury, Tim

  Clark, William (Croydon S)

  Knight, Mrs Jill

  St. John Stevas, Norman

  Cockcroft, John

  Knox, David

  Scott, Nicholas

  Cooke, Robert (Bristol W)

  Lane, David

  Shaw, Giles (Pudsey)

  Cope, John

  Langford-Holt, Sir John

  Shaw, Michael (Scarborough)

  Cordle, John H.

  Latham, Michael (Melton)

  Shelton, William (Streatham)

  Cormack, Patrick

  Lawrence, Ivan

  Shepherd, Colin

  Corrie, John

  Lawson, Nigel

  Silvester, Fred

  Costain, A. P.

  Le Marchant, Spencer

  Sims, Roger

  Critchley, Julian

  Lester, Jim (Beeston)

  Sinclair, Sir George

  Davies, Rt Hon J. (Knutsford)

  Lewis, Kenneth (Rutland)

  Skeet, T. H. H.

  Dean, Paul IN. Somerset)

  Lloyd, Ian

  Smith, Cyril (Rochdale)

  Douglas-Hamilton, Lord James

  Luce, Richard

  Smith, Dudley (Warwick)

  Drayson, Burnaby

  McAdden, Sir Stephen

  Speed, Keith

  Durant, Tony

  MecCormick, Iain

  Spence, John

  Dykes, Hugh

  McCrindle, Robert

  Spicer, Michael (S Worcester)

  Eden, Rt Hon Sir John

  Macfarlane, Neil

  Sproat, Iain

  Edwards, Nicholas (Pembroke)

  MacGregor, John

  Stainton, Keith

  Elliott, Sir William

  Macmillan, Rt Hon M. (Farnham)

  Stanbrook, Ivor

  Emery, Peter

  McNair-Wilson, M. (Newbury)

  Stanley, John

  Eyre, Reginald

  McNair-Wilson, P. (New Forest)

  Steel, David (Roxburgh)

  Fairbairn, Nicholas

  Madel, David

  Steen, Anthony (Wavertree)

  Fell, Anthony

  Marshall, Michael (Arundel)

  Stewart, Donald (Western Isles)

  Finsberg, Geoffrey

  Marten, Neil

  Stokes, John

  Fisher, Sir Nigel

  Mates, Michael

  Taylor, R. (Croydon NW)

  Fletcher, Alex (Edinburgh N)

  Mather, Carol

  Taylor, Teddy (Cathcart)

  Fletcher-Cooke, Charles

  Maude, Angus

  Tebbit, Norman

  Fookes, Miss Janet

  Maudling, Rt Hon Reginald

  Temple-Morris, Peter

  Fowler, Norman (Sutton C'f'd)

  Mawby, Ray

  Thatcher, Rt Hon Margaret

  Fox, Marcus

  Maxwell-Hyslop, Robin

  Thomas, Rt Hon P. (Hendon S)

  Freud, Clement

  Mayhew, Patrick

  Thorpe, Rt Hon Jeremy (N Devon)

  Fry, Peter

  Meyer, Sir Anthony

  Townsend, Cyril D.

  Gardiner, George (Reigate)

  Miller, Hal (Bromsgrove)

  Trotter, Neville

  Gardner, Edward (S Fylde)

  Mills, Peter

  Tugendhat, Christopher

  Gilmour, Rt Hon Ian (Chesham)

  Miscampbell, Norman

  van Straubenzee, W. R.

  Gilmour, Sir John (East Fife)

  Mitchell, David (Basingstoke)

  Vaughan, Dr Gerard

  Glyn, Dr Alan

  Moate, Roger

  Viggers, Peter

  Godber, Rt Hon Joseph

  Monro, Hector

  Wainwright, Richard (Colne V)

  Goodhart, Philip

  Montgomery, Fergus

  Wakeham, John

  Goodhew, Victor

  Moore, John (Croydon C)

  Walker-Smith, Rt Hon Sir Derek

  Goodlad, Alastair

  Morgan-Giles, Rear-Admiral

  Wall, Patrick

  Gorst, John

  Morris, Michael (Northampton S)

  Walters, Dennis

  Gow, Ian (Eastbourne)

  Morrison, Charles (Devizes)

  Warren, Kenneth

  Gower, Sir Raymond (Barry)

  Morrison, Hon Peter (Chester)

  Watt, Hamish

  98

  99

  Weatherill, Bernard

  Wiggin, Jerry

  Wells, John

  Winterton, Nicholas

  TELLERS FOR THE NOES

  Welsh, Andrew

  Wood, Rt Hon Richard

  Mr. Anthony Berry and

  Whitelaw, Rt Hon William

  Young, Sir G. (Ealing, Acton)

  Mr. Russell Fairgrieve.

  [For Division List 319 see col. 187]
  Amendment accordingly negatived.
  Mr. Armstrong: I beg to move, That this House doth disagree with the Lords in the said amendment.
  I understand that it is convenient to discuss at the same time the Lords amendments Nos. 5 and 6.
  The amendment is substantially similar to one moved by the Opposition on Report. Our principal objection then, as now, was that the effect of the clause would be to draw out this sorry affair. In each case where the district auditor decided to issue a rent loss certificate it would be referred to the courts, which would consider whether the councillors responsible for any surchargeable loss should be required to make good any part of such loss up to £1,000 each, and whether they should be disqualified from civic office for up to five years.
  The effect would be that month after month, year after year, local government would receive the verdicts on events which are already in most cases more than three years old. The details and arguments about events in each of the 18 or so councils concerned would be dragged through the courts and the Press. Irreparable
  128
  damage would be done to a service already under great pressure from Press and public, to individuals and their families and to councils and the areas for which they acted.
  8.15 p.m.
  All this would come at a time when local government is urgently in need of the trust and confidence of the public. Involvement and service in public life are more demanding and difficult today than ever before. Local government reorganisation, the effects of inflation and increasing demands by ratepayers on public services have all contributed to the growing criticism and denigration of a service which is vital to our democratic way of life. The House should ponder long and carefully before adding to the difficulties in the way envisaged by the clause.
  Under our proposals in Clause 1 the normal procedure of the district auditor is not altered save at the point of surcharge. This means that he must carry out a very full investigation of each case, and there must be a public hearing at which local electors may object formally to any loss or expenditure incurred by their former council. The district auditor must completely satisfy himself whether any items of account are illegal or whether any losses were caused by negligence or misconduct.
  I have the greatest respect for district auditors. They have considerable experience in determining just this sort of issue. But the Opposition, by the terms of their clause, appear to lack confidence in that experience, for they demand that after the district auditor has carried out his detailed investigation the court should cover exactly the same ground again.
  It is more than likely that on such a difficult issue there would be appeals to higher courts. Only after a lengthy process would the local authorities know how much of the loss of rent would be left for them to recover from the local community. Incidentally, this is a defect in the Bill as it has been returned to us. Under the definition of "effective date" of the rent loss certificate in Clause 1, a local authority might well have to commence recovery of the lost rent before knowing how much was to be recovered as a result of a court's decision under the new clause.

  129
  The new clause conclusively demonstrates the unwillingness of the Opposition to close the book, to show any appreciation of the strong feelings that were raised by the Housing Finance Act. They are, apparently, determined to extract personal penalties at any cost. They fail to recognise the main object of the Bill, which is to put this divisive affair behind us and allow local authorities to recover their losses from the local community.
  The clause would probably impose extra legal costs to be borne by the authorities. It would certainly increase bitterness and cynicism about local government, and would bring benefit to nobody.
  Therefore, I ask the House to reject the amendment.
  Mr. Raison: My hon. and learned Friend the Member for Southport (Mr. Percival) made clear in the previous debate that, although Clause 4 has had most of the limelight, it is Clause 1 that matters most and is the real outrage. Clause 1 establishes something that we accept—the rent loss certificate. We believe that that is the right approach. What the Lords amendment does, following the Opposition's approach in this House, is to say that, instead of the certificate being the end of the matter for the councillors, there shall be a further certificate stating the sum and the people who would have been surcharged.
  This certificate would be sent to the court, which could order individuals to pay up to £1,000 of the surcharge and, where the total loss exceeds £2,000, be liable to disqualification for up to five years. We stress that the court should have regard to all the circumstances including ability to pay. We have argued this scheme at length, both in Committee and on Report. I do not propose to repeat every word of those arguments.
  The scheme which the Lords have put into the Bill contains certain essential points. First, I believe it to be true that that the scheme has never been seriously attacked on the ground of whether it stands up. The Under-Secretary has just criticised it on technical grounds, but it is a criticism that could easily be corrected if the will were there. No significant technical faults have been found with the scheme. Furthermore, the
  130
  Government spokesmen acknowledged during the Committee stage and until today that the scheme is a thoroughly constructive one. The Attorney-General said on Report that:
  "It is a carefully constructed attempt…to mitigate the rigours of the law for the benefit of those who would otherwise have been surcharged and might have been disqualified for failure to implement the Housing Finance Act."—[Official Report, 14th May 1975; Vol. 892, c. 490.]
  That statement was echoed by other Ministers in earlier proceedings. It is a careful attempt to deal with this difficult problem. More than that, it is a scheme that tempers justice with mercy. As hon. Members have said, it could well serve as a prototype for the future legislation which many of us believe we shall have to have in place of the scheme that existed in the 1933 Local Government Act and was substantially varied in the 1972 Act.
  Mr. David Weitzman: Does the hon. Gentleman not appreciate that if this scheme were adopted we could have long-drawn-out proceedings in the courts, possibly appeals, considerable expense and a great deal of bitterness and cynicism? Surely he will pay attention to that important fact.
  Mr. Raison: I shall deal with that point in a moment. When one breaks the law one has to face the consequences. The vital point, which has never been met by the Government, is that this amendment upholds the principle that if councillors defy the law they must expect to face the consequences. It is no good quoting, as the Attorney-General did in Committee, dubious precedents. The fact is that if the Government allow the Bill through in the form they want, they will have no answer to future councillors who might choose to defy the law, whether it is over the Community Land Bill, comprehensive education, the mysterious, secret magical, mystery incomes Bill or anything else.
  I repeat, what would the Secretary of State do if, on some future occasion, councillors broke the law and turned to him saying "Why cannot you let us off as you let the Clay Cross councillors off and the other 400 who defied the Housing Finance Act?"? The Secretary of State and the Attorney-General have

  131
  never answered that question, which is absolutely crucial to the whole debate.
  As my hon. and learned Friend the Member for Southport said during the last debate and as the hon. Member for Liverpool, Toxteth (Mr. Crawshaw) said, the effect of the Lords amendment is to take this matter out of the political arena into that of the courts. This must be right in principle. The courts can consider this matter dispassionately. However, it must be many more times right in this case than in any other when the political jobbery involved in what we are discussing has been so blatant. It is utterly wrong that the Secretary of State should contemplate coming to the aid of Labour councillors in this way.
  I shall not go over again the disgraceful story of the 1973 Labour Party conference, the sayings of the Leader of the House and so on. They are on the record and remain as a deep shame to Labour Members. However, the point about taking this out of politics has been reinforced by the dreadful happenings reported to have taken place at the Parliamentary Labour Party's meeting last week. My hon. and learned Friend has quoted what the Secretary of State said, and the right hon. Gentleman has not denied the truth of the Press reports in the Daily Telegraph. He said that the object of the Lords:
  "is to wreck the Bill and preferably to wreck the Labour Party as well.
  Those 400 councillors would be dragged one by one through the courts. Many would suffer heavy fines and most would be disqualified.
  We should be forced into a series of by-elections on grounds of our opponents' choosing, and some of the best Labour-controlled local authorities in the country would be decimated in the process. That is what their Lordships want to see."
  I do not believe that this consideration has played any part in the opposition to the Bill. I can say with absolute truth and honesty that in all the thinking I have done on the Bill and in all the discussions I have had with my hon. Friends about it, this consideration has never arisen. It is up to the Secretary of State now to confirm or deny those Press reports. We are faced with a piece of nauseous and craven party pleading. The fact is, as the Secretary of State is only too aware, that the Labour Party conference will be held in a few weeks' time and he has
  132
  the National Executive Committee breathing down his neck, and apparently he has his hon. Friend the Member for Holborn and St. Pancras, South (Mrs. Jeger) advancing a point of view which I should have thought was utterly distasteful to anyone who cared about the sovereignty of Parliament over that of party.
  I say to the Secretary of State that it is not too late to accept the entirely rational approach which is embodied in the Lords amendment. Without this amendment the Government's approach is wrong and it will not—this was the essence of what the Under-Secretary said—bury the matter.
  The Government have to recognise that the procedure of the rent loss certificate will have to be gone through. The recovery of uncollected rent will have to take place from tenants or ratepayers, and under the Government's Bill this can be spread out for over five years. Therefore, the notion that we can wipe the slate clean instantaneously under the Bill is a complete fallacy. The resentment against the Government's proposals would linger on for at least half another decade.
  Above all, if the Government's approach on this clause is accepted, the rule of law will be lastingly scarred. I appeal therefore to the House to support the Lords amendment.
  Mr. Carlisle: I share the view of my hon. Friend the Member for Aylesbury (Mr. Raison) that Clause 1 is the most important clause of the Bill. As we have learnt already this evening, the words "Clay Cross" or "Clause 4" give rise to an extremely emotive matter. However, in practical effect Clause 4 is dead because, as I understand the position, the councillors are already disqualified for other reasons and in any event the Bill does not attempt to remove the surcharge from them. Therefore, the practical effect of Clause 4 is nil.
  The practical effect of Clause 1, on the other hand, is immense. We are faced with a matter of great importance and one which incorporates an important principle. The principle is: should or should not people be required to face the consequences of their acts when they choose deliberately to ignore and not to carry out the law of the land?

  133
  In moving the Second Reading debate of the Bill in another place, the Lord Privy Seal said that:
  "laws must be obeyed…We are most certainly not condoning this misconduct."—[Official Report, House of Lords, 9th June 1975; Vol. 361, c. 14.]
  That is exactly what the Bill and this clause do—they condone the misconduct of those councillors who may be found, on audit, to have refused deliberately to carry out the law of the land.
  We are, through this Bill, saying to those who so refused to obey the law and did so deliberately "Nevertheless you shall be absolved from the consequences." I believe that not only is this an important constitutional point but it is also an extremely dangerous precedent. It is in no way with disrespect to the hon. Member for Accrington (Mr. Davidson), the Parliamentary Secretary to the Law Officers' Department, that I say that I am surprised that neither the Attorney-General nor the Solicitor-General is on the Treasury Bench when a matter of this kind is being debated.
  All of us have a responsibility to abide by and to accept the law. But surely that responsibility is greatest of all on those who stand for elected office. Those who are part of the democratic procedure and obtain their office through the democratic procedure, above all, have the responsibility to carry out and obey that democratic procedure.
  Mr. Skinner: The hon. and learned Gentleman has got on to a very interesting point. He says that those who have been democratically elected should pay cognisance to the law—in fact, more so than the ordinary citizen. Would he also comment on a situation in which a body of people who have been democratically elected by about 62 per cent. of the electorate—slightly more than those who voted in the referendum—proceed to refuse to acknowledge the law, and then, as a result of the subsequent disqualification, not 62 per cent. but 72 per cent. of the total electorate send in another 10 councillors to do precisely the same?
  8.30 p.m.
  Mr. Carlisle: People are free to refuse to acknowledge the law but they must accept the consequences. That is all I am saying, and that is all that the clause says. Indeed, it clearly tempers the
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  amount of surcharge that can be imposed on any of them in order to ensure that the damage done to them personally is not so great as to drive them into bankruptcy.
  Mr. John Lee: Would the hon. and learned Gentleman draw an analogy with the situation of the people in Rhodesia who committed high treason and who nevertheless were met, I think wrongly, by the Prime Minister in the "Tiger" talks—clearly on the supposition, which I think still prevails, that those people will never be prosecuted for the high treason which they committed?
  Mr. Carlisle: I refuse to be drawn into arguing about Rhodesia, or about whether free democracy applies in other parts of the world. All I am saying is that where we have a free democratic system, people who obtain office by means of the ballot box and who hold their position as a result of the support of the people, as shown democratically, have the greater responsibility to accept the democratic decisions of the institutions of this country. That means that councillors, like Members of Parliament, have a particular responsibility to obey and accept the decisions of this House.
  I concede to the hon. Member for Bolsover (Mr. Skinner) that everybody is free to fight as hard as he can to get the law changed by democratic methods, but so long as it is the law which has been passed democratically people have a duty to carry it out. If they deliberately choose not to do so, they must be prepared to accept the consequences.
  The fact is that the rule of law in this country is one and indivisible. One cannot pick and choose which laws one will obey and which laws one will disobey. Yet that is the attempt of Clause 1. Whatever the Secretary of State may protest, I have no doubt that were the councillors concerned not of the same party political persuasion as the present Government, we would never have seen legislation of this kind on the statute book.
  What is the Secretary of State going to say to those ratepayers who may choose to refuse to pay any additional rate caused by this Bill, based on the precedent that councillors who should have been surcharged and disqualified have deliberately had the consequences of their

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  misconduct removed? It is an extremely dangerous precedent. It is the worst type of political chicanery. The Labour Government are doing it only because they are trying to help their own Labour councillors. I believe that it is a disgrace to this House that we are seeing legislation of this kind, and I hope very much that we shall vote to agree with the Lords in this amendment.
  Mr. Crawshaw: On Second Reading I made some very harsh criticisms of my hon. Friends on the Front Bench. I do not retract anything that I said then. I would only add that I have more admiration for them now in their staying power in pursuing this Bill. I do not believe any of them have their hearts in this Bill. I believe they are committed by a party conference decision to do something which in their own hearts they know is completely contrary to the rule of law in this country.
  I shall be supporting this clause. On Second Reading I criticised the surcharge method and also the automatic five years' disqualification. This seems to be in order now. The clause provides that courts will consider each case individually, and it is no good saying that because there will be many people coming before the courts we should automatically exonerate them. On that principle, many of the people queueing up for road traffic offences would also have them wiped out.
  If a person says he will not obey the law, and anybody is entitled to please himself which law he wishes to obey, he should stand by what he has done and take the punishment accordingly. I am surprised that in the amendments consideration is being given to people who, in many cases, deliberately decided to go against the law. It amazes me to hear Ministers saying that we in this House rather than the courts are to decide guilt or otherwise and whether people should be surcharged. If all these people were exonerated, I would be happy—provided it was done by the courts and not by this House.
  I wonder what Government Ministers will say when other people start disobeying the law. The question has already been asked by the hon. and learned Member for Runcorn (Mr. Carlisle) a member of the same profession as myself,
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  and there is a Press report that Clay Cross householders had been warned by the Minister not to start a rate rebellion after they had asked him to exempt them from any penalties if they refused to pay extra rates. Once we start on this vicious circle, there is no end to it. Time after time people will assume that, because we have exonerated certain people, anything they do will be put right by their party.
  The new clause is essential because it restores to the courts the job which is theirs to do—to decide whether a person should be surcharged or disqualified. We have tempered that discretion and every opportunity has been provided in Clause 2 for people to get very fair treatment. I do not see that anyone could complain about the provisions of Clause 2.
  I ask the Government to put back this clause where it belongs, where the rule of law decrees it should be—not to Members of this House, but to the legal profession. The Attorney-General and his associates in the legal offices of this country, whose job is to ensure that the rule of law is carried out, are bringing in legislation making a mockery of it. The disgust I feel at the action being taken in this Bill cannot be explained. In time, every Minister will regret it in the same way as the phrases "pound in your pocket" and "at a stroke" are now regretted. Clay Cross may be forgotten this year but it will be remembered in future years.
  Mr. Patrick Mayhew: I agree with every word of the hon. Member for Liverpool, Toxteth (Mr. Crawshaw). There is, however, a distinction between the phrases he recalled, to the equal embarrassment of both sides of the House, and what we are discussing now. Those phrases were uttered, without, perhaps, great consideration, in the heat of the moment and without the opportunity to reconsider or withdraw them. That is not the case with this Bill. The Government have had month after month to reconsider the argument and the course they have chosen to take in the Bill. There is no excuse for persisting in this unconstitutional and profoundly damaging course.
  I am sorry that the hon. Member for Bolsover (Mr. Skinner) is not present—
  Mr. Skinner: I am here.
  Mr. Mayhew: I am glad to see the hon. Gentleman standing up rather than reclining like a superannuated ball boy at a bad tennis tournament, which he has been doing throughout the debate. I ask him to reflect on this. The only reason he is permitted the liberty which is enjoyed by each of us in the House and in the country is that the laws of this country make no distinction as between people and they are enforced and applied by the courts impartially. Once a precedent is set for the indemnification of people who not by accident but deliberately have flouted their duty under the law, the liberty which permits the hon. Gentleman to continue in his course of conduct has gone, and we on this side will not grieve for him but we shall grieve for the rest of our people.
  The Under-Secretary of State, in his embarrassed defence of the Bill and in his opposition to the Lords amendments, said that the amendments would lead to the bringing of local government into disrepute. I could scarcely believe my ears. It is not local government officials but elected members of local authorities who have brought local governments into disrepute. If it is the Government's intention to maintain local government's hitherto deservedly high reputation for integrity, let them turn their attention to the conduct of elected members.
  It was the conduct of elected members which members of another place particularly had in mind in drafting the amendment. This House, too, should be concerned with the conduct of elected members. It is trifling with words and with the people of this country to pretend that local government does not have a duty to implement and enforce Acts. Once we recognise that there is a discretion to pick and choose, we are leading the way to anarchy and the Secretary of State for the Environment, who I hope will reply to this debate, knows that perfectly well. In view of speeches such as that just made by the hon. Member for Toxteth, who have given a lifetime of service to the right hon. Gentleman's party, I wonder how he can persist in this course of action, which is a matter of the deepest shame to every Englishman.
  Mr. Weitzman: I agree entirely that the rule of law should be obeyed and that if anyone disobeys the law he should pay the penalty for it. But let us be practical about this matter. A lot of airy-fairy words have been used about breaking the rule of law, and so on. Let us come down to brass tacks.
  On Second Reading I mentioned certain councillors who I knew had written to the then Minister asking him to intervene in certain matters. They received no reply from him and subsequently were in default. Subsection (4) of the proposed new clause provides:
  "The court shall not make an order…if the court is satisfied that the person authorising or incurring the expenditure, loss or deficiency in question acted reasonably or in the belief that his action was authorised by law…".
  There are 400 councillors involved. What are they to do? First, they must get a certificate. Then they have to follow the court procedure. Each councillor must satisfy the court that he acted reasonably. Let us suppose that he loses and judgment is given against him. Then he goes to the Court of Appeal, where judgment may be given against him again. Possibly, a point of law will arise, which the Court of Appeal certifies as such, and on the case goes to the House of Lords, where we have another trial.
  8.45 p.m.
  That is not idle speculation. These are practical problems. Plainly, there might be a protracted procedure lasting for years. What is to happen to the councillors? What is to happen to the by-elections which may or may not take place? What will happen to the position of local government then?
  What the Government did in this Bill—let us not talk about breaking the rule of law—was to say, from a practical point of view, that we have these instances and we shall wipe the slate clean. There will be a certificate from the district auditor, and that will be an end of the matter, subject to the recovery of the money in the different ways set out in the Bill.
  What the Lords amendment does is to accept that approach but then to add to it the long procedure in the courts which may well follow. Surely, hon. Members opposite must recognise that, from a practical point of view, something ought to

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  be done. Indeed, a previous Tory Government did much the same in the Poplar case. Were they accused then of a breach of the rule of law? What nonsense it is to say any such thing.
  My response to the Opposition is to say: "You are right in your argument about the rule of law. You are right to say that it ought not to be disobeyed, and you are right in saying that the penalty ought to be paid. But the Government, any Government, have a right to look at things from a practical point of view", as a Tory Government did in 1927, I think it was, in the Poplar case, saying that this is a proper matter on which the slate should be wiped clean. In my judgment, therefore, the Lords amendment ought to be rejected in this case.
  The Secretary of State for the Environment (Mr. Anthony Crosland): I shall reply briefly because most of the arguments presented on both sides of the House have by now become very familiar, and it is almost impossible to say anything new at this stage in the debate. Strong language has been used by some hon. Members who have not contributed to our debates hitherto—words such as "shameful" have been flying about—and I shall revert to that later. First, however, I wish to say a word to my hon. Friend the Member for Liverpool, Toxteth (Mr. Crawshaw).
  I have for some time patiently endured from my hon. Friend what I regard as grossly unfair attacks upon me and upon the morality of my Front Bench in this matter. Let me remind my hon. Friend, therefore, when he says that we have supported this clause—not the new clause from the other place but the one that we propose for the Bill—because we were slavishly carrying out party conference decisions, that there has been no party conference decision of any kind on this matter. The only party conference decision referred to the Clay Cross councillors, nor to the 400 councillors who are affected by the clause which we are here discussing.
  Let me remind my hon. Friend also, since the hon. and learned Member for Royal Tunbridge Wells (Mr. Mayhew), in supporting him, said that he had followed my career over many years, that neither he
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  nor anyone else can regard me as one of the most slavish followers of Labour Party conference decisions.
  Mr. Crawshaw: Will my right hon. Friend give way?
  Mr. Crosland: No, I will not. My hon. Friend had his say about me, and I am having my say about him.
  Mr. Crawshaw: My right hon. Friend mentioned me by name. I am grateful to him for now giving way. If my right hon. Friend is no slavish follower of party conference decisions—I shall not enter that dispute—will he answer the question which he did not answer on Second Reading? Would he be putting forward this legislation if these were Conservative councillors? If he says that he would not, will that not show it to be a piece of party legislation to help some of our own party? If he says that he would, what answer will that give to those other councils in which councillors in the future will refuse to carry out legislation which he passes?
  Mr. Crosland: I shall answer that question in the course of showing that the case put by the Opposition, which, I regret to say, my hon. Friend has supported, is a case based on total hypocrisy in regard to this decision.
  I have a passionate faith and belief in the rule of law. The hon. and learned Member for Southport (Mr. Percival) treated this debate in a frivolous and contemptuous manner. For what it is worth, if we have any time left for serious argument, I make this point. I believe that the bonds holding modern civilisation are of an extremely fragile character. I have long believed that. I believe it increasingly with every year that I live. The importance of the defences—of which the rule of law is one of the most important—against anarchy and the break-up of our society cannot be exaggerated.
  As I explained on Second Reading, in any civilised or democratic society there are occasions when the principle of the rule of law must be balanced against the principle of clemency. This has been a conflict of two social values which have puzzled successive Governments in every continent and in every century since the time of the ancient Greeks.

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  The Opposition have tried to maintain that we are making a concession here in not applying the full rigour of the law, and which they bitterly oppose. That is not the case. The Opposition do not propose to apply the full rigour of the law—and neither does the other place. This amendment displays a constructive approach, although I do not agree with it. The amendment says that the Tory Opposition, as well as the Labour Government, concede that the full rigour of the law is not to apply to the 400 councillors whom we are discussing. Therefore, to maintain that the Opposition are defending the rule of law and that the Government are bitterly attacking it is a No. 1 piece of hypocrisy.
  As to the second piece of hypocrisy, my hon. Friend the Member for Toxteth asked what the Government would do if Tory, not Labour, councillors were involved. The attitude adopted is not a new one. This is not the first occasion when either a Conservative Party or Government have taken such an attitude. I do not criticise the Opposition for the past occasions when they have taken that attitude. We have heard this argument before. Whatever the hon. and learned Gentleman may say, we believe that Neville Chamberlain, in the famous Poplar case, went further in trespassing on the principle of the rule of law than we are in this Bill. It is the Government's view—and, I take it, the view of the Opposition—that he was justified in doing so for the same reasons as we are trying to do this—namely, to use Mr. Chamberlain's phrase, not my phrase, in the interests of wiping the slate clean.
  We heard the example in Glasgow of Mr. Gordon Campbell, formerly Secretary of State for Scotland. There was the example, about which we have argued, of the former Conservative Secretary of State for Wales and the school milk row in Merthyr Tydfil. This is not a unique decision of a Labour Government alone. A decision of this kind has been made before by Tory Governments, whether it concerned Labour or Tory councillors.
  Mr. Michael Brotherton: Is the Secretary of State admitting that the Government are trespassing against the law? That is what he said.
  Mr. Crosland: No. Any democratic Government must recognise that there are two possible social values which may be in conflict. One is the rule of law. The other is the need for clemency. Previous Conservative Governments faced with this dilemma have on more than one occasion chosen the principle of clemency and not the principle of the rule of law.
  Mr. Swain: My right hon. Friend led the opposition against the then Tory Bill. He will remember the long struggle over Clause 95, dealing with the Housing Commission. Does he argue that the then Housing Minister refused to recognise that point of law and, after sitting five and a half months to get the measure on the statute book, refused to send in the Housing Commissioner at the first available moment?
  Mr. Crosland: I shall not argue with my hon. Friend about that, as it has nothing to do with the Lords amendment which I am now discussing. We may have an argument when we come to Clause 4. I look forward to that. My hon. Friend, like some of my other hon. Friends, has frequently been personally offensive, and I look forward to returning his abuse in kind.
  Mr. Carol Mather: Will the right hon. Gentleman give way?
  Mr. Crosland: No. I am thoroughly enjoying myself at the moment, but only with Labour interrupters. I do not want any Tory ones.
  With this Lords amendment there is not a basic issue of principle on the rule of law; there is a difference between two ways of dealing with the situation. The Opposition, as well as the Government, concede that some modification of the present rigour of the law is necessary. For reasons explained by my hon. Friend the Under-Secretary of State, we believe that our method is superior, and I hope that we shall reject the amendment.
  Sir Michael Havers: I cannot resist going back to one or two aspects of the Under-Secretary of State's speech. He told the House that if the amendment were accepted irreparable damage would be done to the local government service, which is under great stress. He said that local government was in need of the trust and confidence

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  of the public and that to carry the amendment would increase the cynicism felt about local government. All those observations were in support of the amendment. The defeat of the amendment is much more likely to lead to cynicism about local government and much more likely to cause a lack of trust and confidence by the public in local government.
  My hon. and learned Friend the Member for Runcorn (Mr. Carlisle) raised an issue which I had not contemplated before. I may be stating it fractionally too high but, on reflection, I think it is probably right that the duty to obey the law is greater for those who stand for elected office. It must also be that the duty to uphold the law is greater for those who hold elected office, particularly in government.
  The hon. Member for Liverpool, Toxteth (Mr. Crawshaw) repeated the question he has asked many times, both in the Second Reading debate and on other occasions. He asked it of his right hon. Friend—perhaps I may still say—and his right hon. Friend told him that he would give the answer in the course of the debate. We wait and we wait, as we did in the Second Reading debate. What is the answer to the question? What will the Secretary of State say when others break the law and ask for the same treatment? The hon. Member for Toxteth put that question again as he did on Second Reading, and again no answer has come from the Secretary of State.
  Mr. Crosland: Will the hon. and learned Gentleman tell the House whether, when the then Mr. Gordon Campbell made the decision he did about the Glasgow councillors, who incurred unlawful expenditure, or when the Secretary of State for Wales made his decision about Merthyr Tydfil, he supported them?
  Sir M. Havers: I shall certainly not be diverted from my speech. The question put to the Secretary of State time after time is perfectly sensible and capable of a clear answer, which we still await.
  My hon. and learned Friend the Member for Royal Tunbridge Wells (Mr. Mayhew) spoke again of a Government who may pick and choose who is to be relieved, an action which is putting us on the road to anarchy. The hon. and
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  learned Member for Hackney, North and Stoke Newington (Mr. Weitzman) yet again raised the question of Poplar. This is not the occasion to deal with that issue. It cannot be dealt with in a debate lasting just under an hour. The hon. and learned Member was a member of the Committee and he will remember the great learning, the tremendous detail and the interest that was displayed in that and other cases by members of the Committee on both sides. A lengthy explanation was given on that occasion by the Attorney-General, and the hon. and learned Member for Hackney, North and Stoke Newington made constant contributions to that debate.
  The Secretary of State speaks of total hypocrisy. I think he was referring to what he believed to be an interruption by my hon. and learned Friend the Member for Southport (Mr. Percival), who did not say a word. The interruption was from someone else, not from him. I have not noticed any levity. My hon. and learned Friend treated the debate with the seriousness and intelligence it deserves.
  9.0 p.m.
  The Secretary of State says that he is a great believer in the rule of law but that the rule of law must be balanced against clemency. But that is exactly what the amendment does. It is not just to provide clemency as such, but clemency with justice, which was wholly lacking in the Government's original scheme.
  This Bill is no more and no less than a Bill of indemnity—the only one in living memory, according to Lord Hailsham when he went through the precedents which he had obtained from the Lord Chancellor. His statement was never challenged. This is the only Bill of indemnity within living memory with the intention and effect of removing the consequences of law-breaking from persons who have deliberately abused their official position by defying the law unreasonably, knowing what they were doing.
  Unlike any other Bill of indemnity, this one does not protect someone—usually a Minister—who has acted in good faith but in fact mistakenly. Our amendment would not create any privileged class of councillors who were responsible for deliberate defiance of the law but it would provide a degree of relief and make available to them what is not available to them now.

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  Under the 1933 Act the amount of surcharge and the disqualification would have followed automatically. The amendment also has the advantage that it would remove from the political arena the responsibility for assessing liability. It would put that responsibility where it belongs—in the courts. The courts are the proper tribunals because then no political element would be involved. The courts have been used for similar purposes—there is, for example, the election court where errors made during an election campaign are put right. The courts took over the old election committees and seem to have done the job very well, probably very much better than Select Committees of this House would have done in the old days.
  I want to express one anxiety about what has gone on in the past few days. If newspaper reports are accurate, the Secretary of State went to a meeting of the Parliamentary Labour Party having indicated in advance that he would be bound by its vote. He appears to have used language very different from the language he used in his speech just now. According to the Press reports, there was a close vote in the PLP, about half the party being there. That apparently is why we are invited to reject the Lords amendments.
  We are invited to do so not because of a Government decision but because this is now a Government decision decided in fact by the votes of their back benchers. If that is so, it is not only democracy gone mad but Government gone mad. It may well be that the Government, ordered to do what they have done by the Labour Party conference, and rescued, as they probably thought they had been, by the other place, have now been ordered yet again, not by the party conference but by the PLP, to restore the Bill as it was.
  Mr. Crosland: This matter should be cleared up. The vote, to which I shall allude on Clause 4, at the meeting solely concerned Clause 4. On the other four matters on which we shall no doubt be voting tonight, there was no difference of opinion of any kind.
  Sir M. Havers: I am grateful to the Secretary of State. If I got the matter wrong, I apologise. My reason for feeling
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  anxious is that it appears that the Government, based upon a decision arrived at in the Parliamentary Labour Party, are deciding to reject amendments from the other place. I wonder what will happen if we continue to be governed by the present Government for very much longer.
  It seems to me that what has been decided by the other place, following very full consideration of the matter, is the correct solution. It is right because it upholds the rule of law, because it produced a degree of clemency, and also because it tempers that clemency with justice. Accordingly, I invite the House to maintain the decision in the other place.
  Question put, That this House doth disagree with the Lords in the said amendment:—
  The House divided: Ayes 271, Noes 261.
  [For Division List 320 see col. 191]
  Question accordingly agreed to.

Clause 8

  SUSPENSION, AND EFFECT OF ADJUDICATION ON PAYMENT AND RECOVERY
  Lords amendment: No. 3, in page 5, line 29, leave out "with the necessary modifications".
  Mr. Meacher: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker: It will be convenient to discuss at the same time Lords amendment No. 4.
  Mr. Meacher: These are relatively technical amendments. They apply to child benefit the recovery of over-payments provisions in subsection (1) and (2) of Section 119 of the Social Security Act 1975, which may be modified in a case where benefit is paid not to the person entitled to it but to another person on his behalf. If the person to whom the benefit is paid has not exercised due care and diligence to avoid an over-payment, it will be possible to recover the over-payment from him instead of from the person on whose behalf he received the benefit.
  These are uncontroversial amendments, and I hope that the Opposition will not be tempted to have another fling at them.
  Question put and agreed to.
  Subsequent Lords amendment agreed to.

New Clause A

  PROVISIONS AS TO THE EXCLUSION FROM A FAMILY FOR FAMILY ALLOWANCES PURPOSES OF CHILDREN ENTITLED TO NON-CONTRIBUTORY INVALIDITY PENSION.
  Lords amendment: No. 5, in page 12, line 35, at end insert new Clause A:
  "A.—(1) In section 11 (which provides that certain children are not to be included in a family for family allowances purposes) of the Family Allowances Act 1965 after subsection (7) there shall be inserted—

  "(8) Where a person is entitled to a non-contributory invalidity pension under section 36 of the Social Security Act 1975, he shall not be treated as included in any family as being a child for the purposes of this Act as respects any period during which he is so entitled.".

  (2) In section 13(1) (regulations) of the said Act of 1965 after paragraph (e) there shall be inserted—

  "(f) for treating an allowance as having been paid on account of a non-contributory invalidity pension in cases where in consequence of a subsequent decision under the Social Security Act 1975 a child who had been treated as included in a family for the purposes of this Act is entitled to a non-contributory invalidity pension for any period for which the allowance was paid, and for reducing or withholding accordingly any arrears payable by virtue of the subsequent decision;

  (g) for treating a non-contributory invalidity pension paid to a child which it is subsequently decided was not payable as having been paid on account of an allowance in cases where in consequence of a subsequent decision under this Act he is treated as included in a family for any period for which the non-contributory invalidity pension was paid, and for reducing or withholding accordingly any arrears payable by virtue of that subsequent decision."."

  6.45 p.m.
  Mr. O'Malley: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker: With this we shall discuss at the same time Lords amendments Nos. 8 and 9.
  Mr. O'Malley: The amendments apply to family allowances provisions similar to those introduced into the Bill on Report in respect of child benefit by providing that a child shall not be included in a family for the family allowances purposes for a period for which he is entitled to NCIP. Also, as with child benefit and NCIP, the clause enables regulations to provide that any family allowances paid for a period for which NCIP is subsequently awarded shall be regarded as paid on account of the arrears of NCIP and that NCIP paid for a period for which it is subsequently decided that it was not payable shall be regarded as paid on account of arrears of family allowances which become payable for that period.
  Where a severely handicapped young person can establish entitlement to NCIP, it is thought better that he should become a beneficiary in his own right rather than continue to be treated as a child for either family allowances or child benefit purposes. The provisions are somewhat complex, but they are beneficial.
  Sir George Young: My hon. Friends and I would like an assurance that this proposal takes nothing away from the disabled. It appears from the debate in another place that a disabled child between the ages of 16 and 19 could be eligible for family allowances and also for NCIP. I understand that the effect of Lords amendment No. 5 is to withdraw family allowances in that case, which would mean a net reduction of welfare benefit from a disabled person. Perhaps the Minister of State would confirm that that is the case and that he is proposing to deprive a family with a disabled child of family allowances.
  Mr. O'Malley: I think that I can give the hon. Gentleman an explanation which will satisfy him.
  Non-contributory invalidity pension, which will be introduced from November 1975 under the Social Security Act 1975, will be payable at £7·90 a week. The interaction of NCIP and family allowances applies only to children aged
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  between 16 and 19. In this age group, NCIP is limited by legislation to children who are not in full-time education and family allowances are limited to those who are in such education. To pay family allowances as well as NCIP for a handicapped child able to follow a minimum of education would give him better treatment than a child so severely handicapped that he was incapable of undergoing any education—in which case family allowances would stop at the age of 16—and better treatment than the less severely handicapped undergoing normal education for whom NCIP could not be paid, although family allowance would continue.
  In any event, family allowances would stop when the child reached the age of 19 and there would then be a drop in family income. NCIP is not taxable whereas family allowances are subject to tax and clawback, so it is clearly preferable where possible to pay NCIP to the handicapped child.
  I hope that that explanation, complex though it is, will be acceptable and satisfactory to the hon. Gentleman and to the House.
  Question put and agreed to. [Special entry.]
  Subsequent Lords amendment agreed to.

Schedule 5

  REPEALS
  Lords amendment: No. 7, in page 30, line 6, leave out "47" and insert "48".
  Mr. Meacher: I beg to move, That this House doth agree with the Lords in the said amendment.
  This is a technical amendment which seeks to alter a paragraph number to bring the Bill into line with changes made in the Social Security Pensions Bill.
  Question put and agreed to.
  Remaining Lords amendments agreed to.

HOUSING FINANCE (SPECIAL PROVISIONS) BILL
Lords amendments considered.
Clause 2

  RECOVERY OF CERTIFIED AMOUNTS
  Lords amendment: No. 2, in page 2, line 34, leave out from "at" to end of line 35 and insert "the appropriate rate".
  9.15 p.m.
  Mr. Armstrong: I beg to move, That this House doth agree with the Lords in the said amendment.
  Mr. Deputy Speaker (Mr. Oscar Murton): With this amendment we are to take Lords amendment No. 3.
  Mr. Armstrong: These amendments were made to correct a practical difficulty over the commencement of the recovery period. It was pointed out to us by the Association of District Councils that if a rent loss certificate became effective late in a financial year, it would be difficult to collect the required amount during the ensuing year. Four weeks' notice is required for rent increases, many of which are made in April, and rates are also fixed some time before the commencement of the financial year.
  Although it would be possible to defer a rent increase or levy a supplementary

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  rate, these courses would be most unwelcome to local authorities.
  Accordingly the amendments lift the requirements to collect one-fifth of the certified loss in the first recovery year in cases where a rent loss certificate becomes effective in February or March. The amendments do not, on the other hand, affect the requirement that the whole amount should normally be recovered within a total of five years.
  We are grateful to the Association of District Councils, which drew this defect in the Bill to our attention.
  Question put and agreed to.
  Subsequent Lords amendment agreed to.
  Lords amendment: No. 4, page 2, in line 39, leave out subsection (3) and insert—
  "( ) A council shall perform their duty under this section by a general increase of the rents of those of their housing revenue account dwellings in the part or parts of their area to which the certificate relates; and a council may make any such increase notwithstanding section 111 of the Housing Act 1957 (charges for local authority's houses)."
  Mr. Armstrong: I beg to move, That this House doth disagree with the Lords in the said amendment.
  The effect of this amendment would be to restrict the freedom of local authorities to recoup the amount of a rent loss certificate by means of a rent increase over the whole of their areas if they so wish.
  We have said on many occasions that it is the responsibility of the local authorities to recover this money locally. We have absolute confidence that they will do so by the method most appropriate for their own area. Only the local authorities can consider all the circumstances prevailing within their areas.
  Opposition Members seem continually to forget that local authorities are elected democratically. They represent all their constituents and are well aware that their decisions have electoral consequences.
  In our view, decisions affecting local people must, as far as possible, be made locally, and this Bill is essentially about local matters. That is why we have drafted it to give local authorities as much choice as possible.
  The Opposition may talk a great deal about their respect for local government,
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  but the amendment illustrates the shallowness of much of what the Opposition say. To vote for the amendment would be to vote against the responsibility and freedom of local authorities to settle their own problems in the way most appropriate for their own areas. I must therefore ask the House to vote against this amendment.
  Mr. Raison: The arguments of the Under-Secretary of State on this clause are rather pathetic. The effect of the amendment is to confine the burden which might fall on rent payers of making up the moneys not collected by the offending councils in the new enlarged authorities to those in the areas which benefited from non-implementation.
  To take the familiar example of Clay Cross and North-East Derbyshire, we believe that, if the full burden is to fall on rent payers, it should only be on those rent payers who benefited from the failure to implement the Housing Finance Act.
  It is nonsensical to present our point of view and that of their Lordships as an attempt to restrict the freedom of local authorities. The point is a very simple one, and I put this to Labour Members as to anyone else. Why on earth should council tenants, in the areas which derived no benefit, be liable, if their council so wishes, to bear this particular burden?
  The Government have throughout our proceedings totally failed to meet this case. They failed to do so in Committee and on Report, and the Under-Secretary of State has failed to do so again tonight.
  The essential fact of the matter is this. The Secretary of State said in his statement on 6th November 1974 that the aim was to recover money from non-implementation from communities which benefited from later implementation. In other words, the Secretary of State said that the burden now is to fall on those communities which benefited.
  I cannot see by any stretch of the imagination how it can be argued that the citizens of North-East Derbyshire, for example, outside the Clay Cross area, benefited in any way from the failure to implement the Housing Finance Act. How can it possibly be the case that those in the areas which at that time were in quite different local authorities can be

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  said to have benefited from this particular failure?
  It really is the most blatant nonsense, and makes mockery, apart from anything else, of the Labour Party's claim to have the interests of council tenants at heart, and I ask the House to support the Lords amendment.
  Mr. A. J. Beith: It is very strange that the Under-Secretary of State should produce this rather worn piece of paper which Departments seem to put into those red files whenever there is something for which they need to find a tawdry argument.
  The Under-Secretary says that this interferes with the freedom of local authorities. We have seen it used before. We have noticed how it is kept on one side and is not brought out when the Government are in a difficult position. We have seen it used by different Governments and left aside by different Governments, but its bearing on the question is negligible, as the Under-Secretary knows well.
  It was people in Clay Cross who benefited from the actions which were taken, and who were the occasion for all this, and it is they who must surely bear the burden when there is a burden to be borne. The wider community of which Clay Cross is now part did not elect the Clay Cross council, and none of the defences put forward applies to the wider area of which Clay Cross is now part. It did not benefit from any of the decisions taken by the Clay Cross council. There is no reason why the costs should be visited upon the ratepayers of that wider area. Nor is there any reason why this House should allow them to.
  The Secretary of State has made several references to wiping the slate clean. Many of us doubt whether a piece of legislation of this kind could do that and would not have consequences extending far beyond our discussions today. But it will be much more difficult to wipe the slate clean if we visit upon other areas the consequences of what was done in the smaller Clay Cross area. How can we tell the ratepayers of the other parts of North-East Derbyshire that by footing the bill they will be helping to wipe the slate clean and to rid our history books of this unfortunate episode?
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  How can we tell the ratepayers that they must foot the bill because it is the law of the land and these matters must be respected? The context of this legislation makes it more difficult to advance that argument. We shall try to do so, but we are undermined in doing so by legislation of which this is part. The notion that the slate can be wiped clean by asking other people to pay the bill is absurd.
  The whole job must be done by Parliament. Parliament must make it clear that, rather than the ratepayers of the whole Derbyshire district, it is the rent payers who benefited who must foot the bill. Responsibility must be kept where it belongs—first with the councillors responsible and then with those who benefited directly from their actions. Without this amendment, I do not see how that can be done.
  Mr. Ivan Lawrence: The concept of wiping the slate clean will now be seen by the wider population to mean wiping it clean on behalf of the Labour Party, despite the great suffering it will create for a large number of ratepayers and others in the area who were not affected by the decision taken by the Clay Cross councillors.
  That is not the only example of "double think" which this amendment brings to mind. Time and time again we have heard Labour spokesmen say that there is great outrage and bitterness in the country that this terrible thing should be visited upon the Clay Cross councillors, who are as white as driven snow, and the 400 other councillors who have deliberately refused to obey the law. But the outrage and bitterness is not all on one side, and Government supporters would be deluding themselves if they thought that they had a monopoly of the ill-feeling that this legislation has engendered.
  There will be much bitterness and outrage in those parts of the country which will have to pay for the mismanagement and deliberately wilful acts of these councillors. So, whether it is because the Government are wiping the slate clean or because they feel that they have a monopoly of outrage and bitterness, the country will see that there is nothing in the arguments of right hon. and hon. Gentlemen opposite who have a purely party political bias which says

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  "Let anyone else suffer, but let us hold the Labour Party together".
  It is for that reason that the Opposition, and I hope, some Government supporters, will accept this Lords amendment.
  Question put, That this House doth disagree with the Lords in the said amendment:—
  The House divided: Ayes 272, Noes, 263.
  [For Division List No. 321 see col. 195]
  Question accordingly agreed to.
  Lords amendment: No. 5, in page 3, line 19, after "account of" insert "(a)".
  Motion made, and Question, That this House doth disagree with the Lords in the said amendment—[Mr. Armstrong]—put and agreed to.
  Lords amendment: No. 6, in page 3, line 21, at end insert—
  "; and
  (b) any sum or sums which the court may order to be paid to that council".
  Motion made, and Question, That this House doth disagree with the Lords in the said amendment—[Mr. Armstrong]—put and agreed to.

Clause 3

  POWER TO CHARGE RATES
  Lords amendment: No. 7, in page 3, line 22, leave out Clause 3.
  Mr. Armstrong: I beg to move, That this House doth disagree with the Lords in the said amendment.
  I take it, Mr. Speaker, that it will be convenient to the House if with this amendment we take Lords amendments Nos. 9 and 10?
  Mr. Speaker: Yes.
  Mr. Armstrong: The purpose of these amendments is to prevent a council from recouping any part of its rent loss by means of charges to the rates. They illustrate once again the fundamental lack of confidence which the Opposition place in local authorities. The Opposition are constantly
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  wanting to instruct local authorities about their procedure.
  As it left this House, the Bill presented those local authorities to which a rent loss certificate was issued with clear options. They could recover their losses by means of rent increases, over their whole area or over the defaulting area only, or they could charge all or part of the amount to the rates, with a similar opportunity to restrict the increases to the defaulting area only. There was also a clear provision to ensure that a decision to charge any amount to the rates could only be made after the most thorough consideration. Such a decision had to be taken at a meeting of the full council, with publicity to ensure that ratepayers were aware of the purpose of the meeting.
  We cannot be aware of all the particular circumstances which may pertain in each of the local authorities involved. That is why we have made their options as wide as possible. We have complete confidence that councils will make the right decisions for their own areas. The policy attaching to these amendments would be a total negation of that confidence.
  Local councillors are the elected representatives of their ratepayers. Ratepayers who disapprove of their council's policy have the opportunity to show their disapproval in the polling booth. Similarly ratepayers of the new area are not powerless should a council decide to make rate increases over the new area. Indeed, the hon. Member for Aylesbury (Mr. Raison) made this very point during Standing Committee. Any council which decided to charge all or part of the amount to the rates would be fully aware of the possible electoral consequences of that decision.
  9.45 p.m.
  It is also likely that without this Bill a large proportion of councils' losses might well have fallen on the rates anyway. Since the means of the councillors concerned are limited, their debts, for the great part, would probably have had to be written off with a consequent burden on the rates. The aim of the Government is to extend local authorities' options so that they can make the appropriate increases for their own area. I ask the House to vote for confidence in local authorities by rejecting these amendments and also to

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  approve the two amendments to Clause 3 which have the effect of bringing the rates option into line with the rent option in Clause 2. They provide a similar relaxation to Lords amendments No. 2 and No. 3 which we have already approved. Where a rent loss certificate becomes effective in February or March, a council will be released from the obligation to recover one-fifth of the amount during the first year. These amendments were approved in another place before it so unwisely rejected the whole clause.
  Mr. Percival: I agree with the Minister on one thing. If his motion is carried, the amendments in lieu should also be carried in order to introduce consistency. But that is the limit of the area in which I can agree with him.
  I hope the Minister will not mind my saying that he has just made another really pathetic speech and there has now been a series of them. I do not think he even realised what the amendment is about. He says we are constantly telling local authorities what to do, but this is not an amendment dealing with charging rates over a limited area. With the clause out of the Bill, local authorities have no power to put this loss on the rates. Our position has always been that there is no reason to charge ratepayers who got no benefit from their councils' actions any of the sums necessary to make good the losses.
  I am not going to take too much time, because this view has been expounded more than once. The Minister spoke about putting an end to bitterness and divisiveness, but does he not realise how bitterly ratepayers will resent being called upon to make good deficiencies from whose creation they derived no benefits?
  Supposing North-East Derbyshire Council decided to levy a rate over the whole area to make good the very large deficiencies arising in Clay Cross.
  Mr. Swain: It would mean one-third of a penny rate each year for five years. That is not a tremendous amount of money.
  Mr. Percival: That is totally irrelevant. Some people object to doing things on principle. I thought that is what the hon. Member was saying to justify the actions of his friends.
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  I just heard the Minister say sotto voce "We have heard it five times before". Yes, we have, but we have not yet had an answer. Let us try once more. It only requires a single-word reply, "Yes" or "No". The Minister can even say it sitting down; we will not complain. Supposing North-East Derbyshire Council decided to raise the sum by levying a rate and a ratepayer objected on principle to having to pay any part of that loss, however small. Is that person to be taken to court and subjected to the full rigours of the law or is he also to be excused? Can we have a "Yes" or a "No" from the Minister? [HON. MEMBERS: "Answer."]
  Mr. Armstrong: As I have said, they will exercise their democratic rights at the next election.
  Mr. Carlisle: The Under-Secretary cannot get away with that. What democratic rights does the ratepayer have at any election in the circumstances envisaged by my hon. and learned Friend the Member for Southport (Mr. Percival)?
  We are told that a third of a penny rate is involved. For a house with a rateable value of £300, that amounts to £1. Let us suppose that a person chooses to pay his rates but on principle deliberately withholds £1. Will the council in North-East Derbyshire take him to court and obtain a distress summons for the £1? That is the question which the Under-Secretary has not answered. As power is taken in the Bill to absolve from penalty people who choose not to carry out the law, on what basis could action be taken against a person who chose to withhold his £1?
  Mr. Weitzman: The Opposition wanted the full rigour of the law to operate with regard to Clause 1.
  Question put and agreed to.
  Amendments made to the Bill in lieu thereof, to the words so restored to the Bill: In page 3, line 33, leave out from 'in' to end of line 34 and insert 'appropriate annual portions'.
  In page 3, line 37, at end insert—
  '( ) In subsection (1) above "appropriate annual portions" means annual portions each of which is not less than one-fifth of the sum charged to the general rate fund, except that, if the effective date of the rent loss certificate falls in February or March, the council shall not be obliged to charge any amount in

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  respect of the year commencing on the 1st April following the effective date'—[Mr. Armstrong.]

Clause 4

  TERMINATION OF DISQUALIFICATIONS FOR FAILURE TO IMPLEMENT HOUSING FINANCE ACT 1972.
  Lords amendment: No. 8, in page 3, line 38, leave out Clause 4.
  Mr. Crosland: I beg to move, That this House doth disagree with the Lords in the said amendment.
  Clause 4 was the clause which lifted the disqualification from the only councillors who had actually been disqualified for their failure to implement the Housing Finance Act, namely, those at Clay Cross. They alone had suffered an extraordinary audit, and in their case alone had the district auditor completed his proceedings. On grounds of consistency it seems to us right to lift the disqualification here, in the same way as the Bill removes the threat of it elsewhere.
  Since we debated this matter on Report the situation has altered. The same Clay Cross councillors and some others were surcharged in April for about £50,000 on account of matters wholly unconnected with the Housing Finance Act. But they had the right of appeal. At the time of the Report stage on 14th May we still did not know if they intended to exercise that right of appeal. So in defending Clause 4 on Report, I made it clear that I did not want in any way to prejudice any appeal which these councillors might make against this second surcharge.
  On 28th May, after the Report stage in this House, the six-weeks' time-limit for an appeal against the new surcharge ran out. The 11 councillors concerned decided not to appeal, and my expert legal advice is that there is now no practical possibility of their finding a way of upsetting the surcharges in the court. That means that they are disqualified for a further five years, and Clause 4 becomes of nil effect. The new disqualification will outrun the original disqualification by about 18 months.
  So Clause 4 is now what the lawyers call otiose. If we restored it to the Bill, it would have no practical effect. As far
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  as the Government are concerned, therefore, it makes no practical difference whether the clause is restored to the Bill or not. The matter has become one on which individuals make up their minds on quite different grounds. That is why my right hon. Friend the Leader of the House announced that the decision on how this side of the House should vote would be taken freely after a meeting of the Parliamentary Labour Party.
  After serious debate last Wednesday—
  Mr. Kenneth Lewis Mr. Kenneth Lewis (Rutland and Stamford) rose—
  Mr. Crosland: I shall not give way. The hon. Gentleman is making his first appearance for tonight. We are pleased to see him.
  After serious debate last Wednesday, that meeting was swayed by two arguments. One was the argument about internal consistency deployed by my noble Friend the Lord Privy Seal in another place.
  Secondly, although the clause will not allow the Clay Cross councillors to stand again for office until the period of their second disqualification has expired, there was thought to be advantage in making it explicit for what reason they are now disqualified—that is, the legislation should provide that they are not disqualified for what took place under the Housing Finance Act.
  I therefore ask the House to reject the Lords amendment.
  Mr. Raison: Having heard that speech, I honestly do not know whether to laugh or cry. As the House knows, the issue before us is simple: should the disqualification of the Clay Cross councillors stand? As we know, that issue has now become purely one of principle—or, rather, abandonment of principle. The Secretary of State told us that the Clay Cross councillors concerned have subsequently been resurcharged and are disqualified for events unrelated to the Housing Finance Act, and this clause, in his words, has become otiose. I put it to him that it still has consequences far greater than he suggests.
  Clause 4 was deleted in the other place on a "stand part" vote by 148 to 41. I am sure that all hon. Members recognise

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  that by any standards the turn-out of Labour peers in the other place was thin. Many appear to have abstained, and Baroness Burton of Coventry spoke and voted against the clause, saying that it was a wrong thing that the Lords were being asked to do.
  The Secretary of State knows full well that this is a wrong thing that the House of Commons is now being asked to do. One is tempted to say that it is farcical—we know that it has no practical effect—but it is worse than farcical. It is contemptible.
  We know that the Secretary of State wished to drop the clause but, on his own admission now, the matter was put before the Parliamentary Labour Party to decide. What an astonishing insult to our Parliamentary system. [Interruption.] I can state categorically that we on this side have never behaved in this way. I assure hon. Members opposite who are laughing that, when the vote comes, they will see that not all their colleagues are happy with what they are doing tonight. It is a contemptible action.
  Why did the Secretary of State agree to this matter being put to the Parliamentary Labour Party? Why did he not have the guts to take his own decision? The only matter throughout all these proceedings on which the Secretary of State has taken a stand on principle was the decision not to remit the original £7,000 surcharge. But this, too, is a weird story. After over a year's delay, the writs on the councillors have now been pressed and bankruptcy proceedings are apparently under way. We are entitled to ask the Secretary of State what has happened to the famous Labour Party fund to pay this money off.
  In his statement on 4th April 1974 the Prime Minister indicated that the Labour Party was to consider how to raise the money. In Committee the hon. Member for Manchester, Ardwick (Mr. Kaufman), then Under-Secretary of State for the Environment, said:
  "I understand that steps are being taken to raise the £7,000, even though it is not yet finally available. From what I understand, I would certainly expect it to be forthcoming in the not too distant future."—[Official Report, Standing Committee D, 24th April 1975; c. 278.]
  Mrs. Jeger: As a member of the National Executive of the Labour Party,
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  I must tell the hon. Gentleman that the only appeal which we have made was for money to pay legal expenses. The Labour Party has never asked for any fund to deal with the situation otherwise. The only appeal has been for legal expenses.
  Mr. Raison: That is contrary to the impression given by the Prime Minister and the Secretary of State.
  On 14th May the Secretary of State said, on Third Reading, that he understood that this money was likely to be available fairly soon. In the event, apparently nothing was raised. The money was not paid off, and the Labour Party was not able to raise this paltry sum of money in support of the Clay Cross councillors.
  It being Ten o'clock, the debate stood adjourned.

  BUSINESS OF THE HOUSE
  Ordered,
  That Government Business may be proceeded with at this day's Sitting, though opposed, until any hour.—[Mr. Walter Harrison.]

HOUSING FINANCE (SPECIAL PROVISIONS) BILL
Question again proposed, That this House doth disagree with the Lords in the said amendment.
Mr. Raison: The question is, why should these councillors, who defied the law so deliberately and outrageously, be totally relieved of the stigma of disqualification? I say "stigma", as the penalty is incurred as a result of their actions on other occasions. Why should Parliament be asked utterly unnecessarily to go out of its way to condone these actions which have been condemned so vehemently on all sides?
We have heard the words of Lord Denning on a number of occasions. I shall not repeat them all. However, I remind the House of what he said about the Clay Cross councillors. He said:
"Each of them deliberately broke the solemn promise which he gave when he accepted office. Each of them has flagrantly defied the law. Each of them is determined to continue to defy it."

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Later he said:
"They were not fit to be councillors. The sooner they were disqualified the better."
That was a judgment in a court of law, which the Government seek to overturn. That is the force of our case against that attempt.
There is only one reason why we are being asked to restore Clause 4. That reason is as contemptible and evil an example of placing party above principle as anyone could imagine. The truth is that the Secretary of State is bowing feebly to the thugs on his back benches.
All Members of Parliament will recognise that to have submitted this decision to the Parliamentary Labour Party in the way in which the Secretary of State did was a disgraceful piece of weakness. To have argued in the Parliamentary Labour Party in the terms which he used was utterly deplorable.
It is essential for the rule of law that the House should reject the Government's proposal and uphold the amendment proposed in the other place.
Mr. G. R. Strauss: I much regret that the Secretary of State should find himself bound to move the rejection of the Lords amendment and to ask that Clause 4, which caused so much controversy, should be replaced.
All who have worked with the Secretary of State know that no Minister stands more strongly and firmly for the rule of law or is more opposed to all breaches of law under any circumstances. Therefore, it is a great pity—about which many of us feel strongly—that it should fall on his shoulders to ask us to reject the Lords amendments and to restore Clause 4 to the Bill.
The meeting of the Parliamentary Labour Party to which he referred—only half the Members were present—did not accept his advice or his strongly held views, and insisted that the clause should remain in the Bill,
The matter arose on previous occasions. A number of us felt keenly about it and contemplated voting against the Government and with the Opposition, in spite of the three-line Whip, when we dealt with the matter on Report. There were others who held the same views but did not feel quite so strongly as we did. We were
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worried as a result of the explanation given by the Secretary of State, who clearly disliked Clause 4 as much as we did. It violated many of the principles we held in common. However, he produced this persuasive argument. He said that it was necessary for Parliament, when considering legislation of this kind, to provide equality for all the people involved. Under the Bill the disqualification of those 400 people was automatically removed. It would, therefore, be grossly unfair if the Clay Cross councillors did not have the same benefit and if some remained disqualified while the disqualification of all the rest was removed. That is the argument he put forward in the House, and it is a strong one. It did not convince us all, but it was a plausible argument.
Since then the situation has changed completely, as my right hon. Friend said. The equality argument is dead.
The only other argument which has been advanced by my right hon. Friend and one or two Opposition Members is that it does not matter now. The Clay Cross councillors will not suffer, their disqualification operates automatically, therefore, it does not matter whether Clause 4 remains in the Bill. They ask: why all the fuss? I cannot accept that point of view. What Parliament does in this matter is of great consequence. Although it does not affect the 11 Clay Cross councillors, it affects public opinion and the reputation of the House.
We are being asked to say that when a group of people—whether they be councillors, business people, individuals or whoever they are—have violated a law of Parliament defiantly and purposely, the House should forget that defiance, take no notice of it and restore to them every right they had before, and that they should be in no way disadvantaged for violating the laws of Parliament.
I have always believed—and I have accepted the view of my hon. Friends here—that these councillors acted with integrity, honesty and a deep feeling that what they were doing was right in the interests of their constituents. But they have said more than once—and this is their faith which they repeated after this Clay Cross trouble was over—that they do not recognise the law of Parliament. The only law they recognise is what they

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believe to be the interests of the working people they represent. They may be right. Maybe they know better than we do what is in the interests of the people they represent, but that does not make them fit and proper people to sit on local government with our blessing. People who start by saying that they will ignore the laws we have passed and will not put them into operation, by definition should not be allowed to sit on local government, because if they do it makes local government undemocratic and parliamentary responsibility in public affairs comes to an end.
Therefore, it is essential that the House should say that the disqualification of those people should remain, not that it makes any difference to them because they are disqualified anyhow in respect of later offences. But the removal of the disqualification would be a gesture of support and appeasement to their point of view, and we should not do it.
Everyone here who believes in the supremacy of Parliament and carrying out the laws which Parliament passes—and everyone who believes in democracy must say that we cannot accept the Lords amendment. Whether or not it comes from the Lords does not matter. All that matters is whether it is wise, right and in the interests of parliamentary democracy in which we believe.
Mrs. Jeger: My right hon. Friend has not always been a supporter of the establishment. Will he not kindly allow that there might be other Socialist democratic opinion which does not go along with supporting an amendment to the Bill by a non-elected House of Lords?
Mr. Strauss: It is not a question of supporting a non-elected House of Lords. We are concerned with supporting a decision made by one of the Houses of Parliament. Decisions made in the other House are often the result of an initiative from the Labour Party. Labour peers have often proposed amendments which are accepted by this House. What we have to consider is the merits of the case. It does not matter where a proposal comes from. The question is whether it is right or wrong.
I say that it is wholly wrong that a disqualification imposed on these people should be removed as a gesture. This is
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a significant matter. It may not affect those involved, but millions of people who are not associated closely or even at all with any political party feel deeply that the rule of law is important and must be safeguarded in all circumstances.
Mr. Lee: I am following the way my right hon. Friend's argument is developing. I repeat to him an argument that I put to the hon. and learned Member for Runcorn (Mr. Carlisle). It is sometimes expedient to disregard breaches of the law. An example is that of Rhodesia, for otherwise my right hon. Friend the Prime Minister could not have met Mr. Ian Smith quite frequently.
Mr. Strauss: If we try to argue this matter on the ground of what has happened in Rhodesia, we get nowhere. This is a simple issue of the law affecting the land of our people—a law imposed on members of local authorities who gave their pledge that they would support it. They have not done so.
Mr. Edward Lyons: Will my right hon. Friend accept that there are those on this side of the House who do not see as synonymous with upholding the rule of law any question of upholding either the establishment or anyone else, but see it as based on democratic government elected on the basis of adult universal suffrage, as this Government have been.
Mr. Strauss: Hon. Members have said that there have been occasions when it has been desirable for people—trade unionists and others—to disobey against the laws of the country. That is true. But they were occasions before universal suffrage and when Parliament was composed of a small clique of wealthy and prosperous people.
Mrs. Audrey Wise: Does not my right hon. Friend accept that the application of the law is, to say the least, distinctly patchy? Would he take this attitude towards employers who constantly break safety laws?
Mr. Strauss: I am not sure what the relevance of that intervention is. But I am in favour of the prosecution of anyone who breaks any law.
Millions of people care about this sort of thing. They really believe in Parliament and the rule of law by Parliament.

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They want that rule of law sustained. They do not want to see anything happen which looks like a breach of the law taking place as a result of political propaganda, the activities of small groups in a particular party, or public clamour. That is what has happened in this case.
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The House should uphold the rule of law and Parliament. It should accept the Lords' amendment, and I believe, judging by his previous activities and the views he has constantly expressed, that my right hon. Friend the Secretary of State deep in his heart would like to accept it too.
10.15 p.m.
Mr. Swain: I have known my right hon. Friend the Member for Vauxhall (Mr. Strauss) since 1945. Sometimes I have respected his views, and on other occasions I have treated his views with less respect. This is one occasion on which I take the latter view.
This matter requires some repetition of history affecting the case. I shall not indulge in tedious repetition because I am not a lawyer—[Interruption.] If you interrupt me, I shall thump you. I do not mean that in a physical sense. Let us get back to the serious point—namely, that when the Conservatives saw fit to put before the House legislation on council house rents, a number of authorities, even before that legislation was enacted, said that they would not implement it.
As a result a meeting was held in Sheffield at which 98 authorities were represented. In the chair was Sir Ronald Ironmonger, the then leader of the Sheffield City Council. A unanimous resolution was passed at that meeting to the effect that all 98 authorities would refuse to implement the Housing Finance Act. The Bill received Royal Assent and one by one the 98 authorities were picked upon. Clay Cross and a few other authorities saw fit to notify the Minister. They were honest authorities and they notified the Minister by letter that in no circumstances would they implement the legislation.
Section 95 of the Housing Finance Act dealt with the appointment of a housing commissioner. We have all no doubt read about, if not read for ourselves, the proceedings in the Standing Committee on the Housing Finance Bill. Although I was not a member of the Committee I spent more time in that Committee room than many Tories, who found themselves in an adjoining Committee room for a good deal of the time enjoying quantities of John Haig and other types of refreshment. Section 95 of the Housing Finance Act gave the Minister power to appoint a commissioner, and at no time was the Minister in any doubt about the intentions of Clay Cross.
In the event Clay Cross did not implement the provisions of the Act, nor did
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several other authorities, including the constituency of my hon. Friend the Member for Dearne Valley (Mr. Wainwright). As a result the Minister concerned did not send in a housing commissioner as he had been begged to do. A letter was sent to the Minister suggesting that if he were to send in a commissioner the Clay Cross councillors would not interfere in the carrying out of his duties. The only fiscal penalty in that legislation involved a sum of £400 in respect of each individual who sought to interfere with the carrying out of the auditor's duties. The Clay Cross councillors pledged themselves not to interfere with the commissioner's duties. The Minister gave the defaulting authorities until 1st January to implement the Act. Three days after the receipt of the letter, even before the Labour group on the council had a chance to consider the letter, the auditor was sent in to audit the books under Section 237 of the Local Government Act 1933.
To put the matter bluntly, the Minister at that time went "round the corner" when it came to the rule of law. The Government had gone to all that trouble to get Section 95 on the statute book, yet they refused to implement it when there was opposition from the Labour Party. There were five and a half months in which the Government imposed a guillotine. Six weeks afterwards they sent Mr. Tracy, the auditor. I had the task of defending the council. After listening carefully and patiently to all the arguments for and against, the auditor decided to surcharge. It says very explicitly in the 1933 Act that a surcharge means automatic disqualification. Those are the historic facts.
The council was then advised by one of the most reputable firms in the country—I shall not name it because that would be commercial—that it had grounds of appeal in the sense that the Minister had acted punitively. That was a technical legal point. It went through the process of law to the Divisional Court and then to Lord Denning in the Appeal Court. Up to that point it had made no mistakes. Lord Denning gave his judgment on 5th October that year, and from that day those lads and lasses were automatically disqualified under the Local Government

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Act 1933. However, at the same time the Minister could have drawn rents from Clay Cross, had he accepted my advice and that of the Clay Cross councillors and sent in the commissioner the moment the letter of intent was written. The letter was an honest-to-goodness declaration of intent.
I turn to the question of party before anything else. I remind the House that the right hon. Gentleman who was then selected as Prime Minister and who has now gone to the other place—namely Lord Home of the Hirsel—at his first conference after being elected said "Every word we say and every action we take from now on must be in the interests of winning the next General Election". Was that partisan politics? Was that a speech in the interests of politics? Was it a speech in the interests of democracy? If hon. Members want any more history, we can give it to them. [Interruption.] Unlike the hon. Gentleman, I have some political hairs on my chest and they are not getting grey.
At no time since 5th October of that year have the Clay Cross councillors made any representation to me, as their Member of Parliament, and I am in Clay Cross every week without a miss. [Interruption.] I take my wife with me, not somebody else's wife. The News of the World is full of Tories. At no time have the Clay Cross councillors made any approaches to me or to my right hon. Friend for help or assistance in this matter. The resolution of the conference was carried by a large majority. That was the will of the Labour Party speaking at its conference. [Interruption.] It was not a block vote or a manoeuvred vote through the Stock Exchange.
It has been said tonight that the Clay Cross councillors have nothing to gain because they are already disqualified for another offence. Anyone who has looked up case law will have discovered that 181 people have been granted full pardon, having completed their full sentence, and 63 of them have subsequently committed another offence and been resentenced. That is exactly what my friends at Clay Cross have done. They are at present surcharged for new offences which have no relation to the Housing Finance Act, as my right hon. Friend categorically stated in his opening remarks.
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I therefore suggest that my right hon. Friend was not the captain of the Labour Party last Wednesday night. If the Labour Party spoke more often as it did last Wednesday night, we would have a better Government. He should ask those lads opposite who are captives of the 1922 Committee. He should ask Ted Heath who was captive of the 1922 Committee—I am sorry for that slight error; I meant the right hon. Member for Cowes, of course.
Mr. Stephen Ross: On a point of order. I do not know whether the right hon. Member for Sidcup (Mr. Heath) happens to be at Cowes at present, but he is not the Member for Cowes. I happen to be the Member for the whole of the Isle of Wight.
Mr. Swain: I ask the House to support my right hon. Friend in his appeal to the House to reject the Lords amendment. That would be democratic. The decision to do so was reached democratically at the Parliamentary Labour Party. The decision was reached by an undemocratically appointed body in the House of Lords. The House tonight has carried Government proposals, admittedly not with large majorities. I quote the late Winston Churchill, one of whose most famous sayings was:
"A majority of one is the best repartee."
If we have a majority of one, I personally and the Clay Cross councillors will be highly delighted.
Mr. Lawrence: I am sorry that at this stage we have been treated to a speech of humour, because I find it rather difficult to treat the subject with any sense of fun. I know that those in my constituency and those who support the stand that this side of the House has taken throughout the long period of the passage of the Bill will feel the same way.
I find it difficult to reconcile the fine-sounding words with which the Secretary of State began this series of debates, in a speech saying that he upheld the rule of law, with the words he used when he sat down having just opposed an amendment which would delete Clause 4. The country will find it hard to reconcile the Secretary of State's pretence of high-mindedness and denial by implication of the political pressure to which he is giving way with the reality.

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I want to take the opportunity of reminding hon. Members at this late hour of what it is that the Government are kowtowing to. I refer them to the terms of conference resolution No. 191 passed on 3rd October 1973:
"This Conference deplores the lack of initiative shown by the National Executive Committee in failing to defend the Clay Cross Council in its fight against the Housing Finance Act. Conference urges NEC to take all possible steps to defend the interests of the councillors and to intensify the national struggle against this iniquitous legislation.
Conference further agrees that upon the election of a Labour Government all penalties, financial or otherwise, should be removed retrospectively from councillors who have courageously refused to implement the Housing Finance Act."
That is what all this is about—not some of the rubbish that we have been treated to tonight and all the way through the Bill.
10.30 p.m.
I find it difficult to understand how the Secretary of State could, even this evening, pretend by implication that there were not political pressures when only four days ago, at a meeting of the Labour Party, in response to the pressures placed upon him, he is reported to have explained why it was necessary to oppose the stand which we on the Conservative side are taking. According to the Daily Telegraph—[HON. MEMBERS: "It must be right."] I cannot help it if the Government make sure that there are informed leaks. The Secretary of State is reported as having said:
"We should be forced into a series of by-elections on grounds of our opponents' choosing and some of the best Labour-controlled local authorities in the country would be decimated in the process."
That is the merest and the purest of party political justifications for the stand that the Government are taking against the interests of the people of this country. If Labour Members do not accept the accuracy of that report, I invite the Secretary of State to repudiate that he said those words at that meeting.
Why do not the Government come clean with the House and admit honestly and frankly that this legislation is being introduced, and held on to through hell and high water, not because it is fair or just or because it is reasonable or even defensible but simply because
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resolution 191 of the Labour Party Conference in 1973 has ordered them to do it?
Has this once great political party come so low that it has to jump to the demands of a block-vote, extremist-dominated conference, however unjustified those demands may be? Are there not more than a mere handful of Labour Members who will stand up for the rule of law? Are there not some Labour Members who are thoroughly ashamed that representatives of their Government should have encouraged the Clay Cross councillors to defy the law, on a promise of absolution on the return of a Labour Government? Are there only the very few who will feel ashamed and will show that shame by being courageous and coming with us into the Lobby against that which is so plainly wrong?
We have heard little during the course of these debates, both here and in Committee, other than double-think and double-talk. Those who seek to uphold the rule of law on this side of the House and the integrity of local authorities have this evening been accused of being cynical. Those who are defending the law-abiding citizens of this country, and who treat this legislation with seriousness and with disgust, are being accused of arousing bitterness and outrage.
The martyrs for Socialism who stand on the Government side are the first to ensure that it is not they who have to make the sacrifice. We note that there has not yet been a whip-round in the Labour Party. It is the innocent ratepayers from areas outside Clay Cross who will have to pay and who will suffer from the blow struck to the rule of law by this Government's action.
This Bill offends—and seriously offends—not only the law-abiding citizen but the standing of Parliament itself. We on the Conservative side can only hope that, by the Government's continuing attempt to make a virtue of what has been nothing less than political corruption, moderate supporters of the Labour Party will be so offended that when the time comes for Government to face the electorate they will be routed.
Mr. Stephen Ross: I want to congratulate the Father of the House, the right hon. Member for Vauxhall (Mr. Strauss), on a brave speech. I enjoyed it very

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much. It is a matter for reflection, I think, that on the very day that Indira Gandhi introduces retrospective legislation into the Indian Parliament, we are asked to agree to the same here.
I ask Government supporters who are thinking of supporting their right hon. and hon. Friends to remember the position into which these councillors—not just the Clay Cross councillors; there are 400 of them—put their chief officers. They put their officers in an impossible position, and they should not be reinstated. That is a view which I have held consistently, and I shall support the Lords amendment.
Mr. George Cunningham: I make no apology for taking up a little more time, because there are one or two things which have still not been said.
I am one of the back-bench thugs who pressurised the Secretary of State into taking the line that he did tonight. Certainly I shall support the Government tonight, my right hon. Friend the Chief Whip may be surprised to hear, despite the fact that I am not always in that position. I do so not because I am instructed by my party conference or by the parliamentary party. I do so because I think that this is right in the circumstances.
Listening to this debate, one would think that there was political consideration in this matter only on the Government benches and that the Opposition were not taking politics into account. We have our political considerations. The Opposition have purer political considerations. It infuriates me that Opposition Members, who raised no objection when illegal actions were committed and when the Minister, now the Chairman of the Conservative Party, Lord Carrington—[HON. MEMBERS: "No."] Very well, the former Chairman of the Conservative Party. But he was not passed on for this reason. He was the responsible Minister when illegal actions were committed under the former Conservative Government. They were actions so clearly illegal which had such financial consequences that in the Estimates passing through Parliament this year an amount totalling £100,000 is paid in compensation for the illegal torture
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conducted in Northern Ireland when Lord Carrington was the responsible Minister constitutionally in charge. However, I should be out of order if I went on about that.
There is a great difference, apparently, between when a Minister is responsible for illegal actions and when a councillor is responsible for illegal actions. But if we have the same rules, there is no doubt that the Minister would be surchargeable for the illegal actions done under his control.
Mr. Lee: It goes even further than that. The Minister responsible for the Hola camp when these matters were being considered—
Mr. Deputy Speaker: Order. The Hola camp is a long way from our argument.
Mr. Cunningham: My hon. Friend is determined to get us into Africa tonight one way or the other. But I shall not take up his point.
I am glad that the responsibility in this matter of the former Minister of Housing, the right hon. Member for Brighton, Pavilion (Mr. Amery), has been mentioned. It is that aspect of the affair which convinces me that the Government should be supported in what they propose. This was a matter of shared responsibility. The legal responsibility for breaking the law belonged to the councillors. But the extent of the surcharge was attributable entirely to the former Minister of Housing. He could have stopped it. He was given powers by the House for the sole reason of stopping it, in order to ensure that a cost which could not possibly be shifted on to the councillors did not fall upon public funds. That is why Parliament gave him those powers. He refused to exercise them.
In another case recently Lord Denning has established a new doctrine in the matter of shared responsibility and contributory negligence. It is conceivable that if the question of the then Minister's responsibility in the matter had reached Lord Denning, he would have held that there was contributory negligence by the right hon. Gentleman. It is because there was contributory negligence on the part of the right hon. Gentleman that I am prepared to vote for the compromise that we are putting through the House.
Mr. Julian Amery: We went to great lengths to make it clear not only to the Clay Cross council but to all councils—the 98 to which one hon. Member referred—that there was no way in which, under our existing constitution and under the law, they could free themselves of the responsibility to carry out the orders of Parliament. That being the case, there was no way in which they could default without incurring the penalties that went with the default. They were not acting in the dark. The situation was made perfectly clear to them several weeks in advance of the final decision.
Mr. Skinner: The right hon. Member for Brighton, Pavilion (Mr. Amery) said that the 98 councils, or however many there were, had had it made abundantly clear to them at the time of their action that there was no other way than to observe the law as laid down in the Housing Finance Act. What he did not tell the House, but what most hon. Members know already, is that in that Act he laid down two or three different ways in which it could be implemented.
The former Secretary of State for Wales decided that perhaps there was a better, less primitive way of obtaining the required rents from certain councils in Wales. It came as no surprise to me that in Merthyr Tydfil, after a relatively short rebellion, and in Bedwas and Machen, after a similar rebellion by a small council not dissimilar to Clay Cross, a housing commissioner was sent in under Section 95 to ensure that the Government's law was carried out to the extent of collecting the necessary £1 a week. There were those who rebelled in Scotland, under a slightly different Act but a similar principle.
The surprising feature was that the right hon. Gentleman and those superior to him decided on a punitive course against the Clay Cross councillors. He used a different method, that of sending in an auditor, as described by my hon. Friend the Member for Derbyshire, North-East (Mr. Swain), who represents that area. An auditor was sent in to take punitive action.
It seemed clear to most of us that the auditor would easily find, as he did, the amount of rent that was owing. I have no doubt that if the same action had been taken in Wales and in many authorities
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elsewhere, some of which are included in tonight's measures, any auditor doing a similar task would have found £X missing as a result of the non-collection of rent.
The hon. Member for the Isle of Wight (Mr. Ross) should not get on his high horse about chief officers being put in an invidious position. The chief officer in Clay Cross was one of the rebels. He did not pay his rent for 80 weeks. Quite apart from being under duress, I am quite certain that that chief officer could have found ways and means of transmitting that £1 a week to the Treasury or to the Department of the Environment in order to make plain that he was not part of this protest.
10.45 p.m.
Let us not get the impression that as a result of the punitive action the Clay Cross people needed to be egged and urged on by anyone. The fact that they had been picked out for this extra-special treatment meant that the population of Clay Cross had delivered successive mandates of quite major kinds—72 per cent. turned out at the polls on one occasion—telling the 11 councillors and their successors "Carry on, we are behind you". When it becomes a question of the rule of law, we have to consider seriously whether the local population are right in the demands they are making upon their elected representatives.
I understand that some of my right hon. and hon. Friends will abstain or, perhaps, vote in the Opposition Lobby tonight against the party decision of a few days ago. It is for them to make their choice [Interruption.] Yes, I have done it, but not in this precise fashion. This is the first time we have had a Parliamentary Labour Party vote while we have been in Government. I do not invite my hon. Friend the Member for Liverpool, Toxteth (Mr. Crawshaw) to defy that democratic decision taken last Wednesday night. I suggest that he should, perhaps, consider the consistency of what he is doing.
One of my hon. Friends who intends to rebel said earlier that he wants consistency and, above all else, for the Clay Cross councillors to be treated exactly the same as the rest. That was his plea when he spoke to the first amendment

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we discussed tonight. We have now reached the last amendment and my hon. Friend is suggesting that the threat of disqualification should be removed from those 400 councillors who went quite a long distance towards rebellion, some doing so unwittingly but others doing so in the same manner as those at Clay Cross but not going quite so far.
I ask my right hon. Friend the Secretary of State to consider the matter of consistency. If it is right for those 400 councillors—we have already passed the appropriate amendment—to be deprived of any disqualification, why not those 11 who were urged by successive Labour Party conferences and decisions to carry on their fight? I cannot remember, when the Housing Finance Bill was completing its passage through the House, anyone of any distinction saying especially to the Clay Cross councillors but also to the Camden councillors or any other councillors, "Do not do this. Do not do that. What are the consequences?" because at the 1973 Labour Party conference the motion was carried unanimously. I am quite certain that some small voice could have spoken at the rostrum on that occasion and made it clear that it was not a unanimous decision.
Another problem that the House has to consider tonight is the question raised by my right hon. Friend the Secretary of State that the fact that there is now a subsequent surcharge is somewhat academic and it does not matter about Clause 4. That is not the case. Of course my right hon. Friend has a legal interpretation of that decision, but we all have legal interpretations. The fact that the second 10 have already appealed against that subsequent surcharge means that there is a possibility—in fact a probability—that the case can be opened for the first 11 in order to follow up with an appeal. Let no one imagine that it is purely academic.
We have constantly been told during this debate that the Government intend to rescue their friends. I remind the House that on a previous occasion when we were dealing with the parallel Bill relating to Scotland, we made clear not only by our actions—[Interruption]
Mr. Deputy Speaker: Order. The hon. Gentleman is fully entitled to address the
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House. We shall get along much more quickly if he is allowed to do so.
Mr. Skinner: We made clear in that measure, which had been decimated by Lords amendments just as this one has been, not only that we would absolve all the Labour councillors in Scotland from whatever penalties were incurred as a result of their rebellion but that we would remove the penalties applicable to the Scottish National Party, Jimmy Reid and all the other councillors who did not belong to the Labour Party.
We on this side of the House have a duty not merely to consider the amendments but also to take into account precisely the process through which the amendments have passed. We are debating in the main Lords amendments arising out of our decision on Report. On Report we came to a certain decision by 250 to 242, and it would be wrong of anybody to assume that since then we have adopted another position. When the Bill reaches the House of Lords the six-weeks' so-called appeal time arising out of the surcharge had been passed. So the position is exactly the same as it was when these Lords amendments were first contemplated.
I am on the side of the National Executive Committee. I am on the side—this time at any rate—of the Parliamentary Labour Party, and I am against the un-elected House of Lords in its attempt to thwart the decision of the House of Commons. I invite my hon. Friends to be consistent and to vote as they did on the previous occasion and give us a majority to wipe the slate clean.
Question put, That this House doth disagree with the Lords in the said amendment:—
The House divided: Ayes 261, Noes 268.
[For Division List 332 see col. 199.]
Question accordingly negatived.

Clause 7

  RATES—SUPPLEMENTARY
  Lords amendment: No. 9, in page 4, line 41, leave subsection (3).
  Motion made, and Question, That this House doth disagree with the Lords in the said amendment—[Mr. Crosland], put and agreed to.
  Lords amendment: No. 10, in page 5, line 6, leave out from "surcharge" to end of line 7.
  Motion made, and Question, That this House doth disagree with the Lords in the said amendment.—[Mr. Crosland], put and agreed to.

  Title
  Lords amendment: No. 11, in line 5, leave out from "made;" to "and" in line 8.
  Mr. Crosland Mr. Crosland rose—
  Hon. Members: Resign!
  Mr. Crosland: I beg to move, That this House doth agree with the Lords in the said amendment.
  This is a purely consequential amendment.
  Question put and agreed to.
  Committee appointed to draw up Reasons to be assigned to the Lords for disagreeing to certain of their Amendments to the Bill: Mr. Armstrong, Mr. Crosland, Sir M. Havers, Mr. Raison and Mr. Stoddart; Three to be the quorum.—[Mr. Crosland.]
  To withdraw immediately.
  Reasons for disagreeing to certain of the Lords Amendments reported, and agreed to; to be communicated to the Lords.

PETITION

  Tidworth Hospital
  Rear-Admiral Morgan-Giles: With your permission, Mr. Deputy Speaker, and that of the House, I wish to present a petition
  To the Honourable the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament Assembled. The humble petition of the Tidworth Hospital Action Group.
  The petition showeth
  That the petitioners call for the retention of full hospital facilities in Tidworth.
  Wherefore your petitioners pray
  That the Tidworth Hospital, at present operated as the Tidworth Military Hospital, should not be closed.
  And your petitioners, as in duty bound, will ever pray.
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  This petition is signed by Mr. Donald Dickey of 15 Abbatt Close, Ludgershall, near Andover, Hampshire, and is signed by 5,839 constituents of the hon. and gallant Member for Winchester, the hon. Member for Devizes (Mr. Morrison) and the hon. Member for Salisbury (Mr. Hamilton).
  To lie upon the Table.

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

  TOMATO GROWERS (ESSEX)
  11.10 p.m.
  Mr. John Wakeham: After the matters of high drama and principle which we have recently debated, I wish to refer to matters in the calmer waters of tomato growing in Essex.
  I am most grateful for the opportunity to raise a matter which is of vital importance to several of my constituents and which may be of much wider importance nationally. I refer to the damage caused to commercial tomato crops by the pollution of the public water supply and the apparent residual effects of pollution which occurred some two years ago. Not only is it causing a number of my constituents to face bankruptcy, but this problem lends wider emphasis to what the Minister of State, Department of the Environment recently called one of the great dilemmas of our time. I refer to the matter of water quality control.
  It is clear that without more precise control of the chemicals that daily find their way into the water supply which we drink and use in our gardens, and which we use in industry and horticulture, we shall soon face a situation which increasingly will detrimentally affect not only the food chain but also the existence of the human population in this country. I say this well knowing that this is a time of tremendous pressure on public resources and public spending, but nevertheless I think that it is a matter of great importance.
  The problem affecting my constituents first became apparent in March 1973 when unusual symptoms began to appear in the leaves of young tomato plants. The

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  Ministry of Agriculture, Fisheries and Food was called in, together with the Essex River Authority, the National Farmers' Union and a firm of consultants, Douglas Gowan & Partners. Eventually it was determined that although other pollutants such as 2–4–D were also present in the water supply, the chemical known as TBA was responsible for the damage.
  This chemical, a deep root weed killer, is manufactured by a well-known firm at Harston near Cambridge. Manufacturing residues were discharged under consent into the river system, and this level of TBA was added to by site seepage. The water from the receiving river was pumped down into Essex and distributed to the nurseries, and eventually damage was suffered on 52 horticultural holdings, the total damage being estimated in the region of £150,000. In addition to this the growers have suffered considerable additional expense in analytical investigation and in payment to professional advisers.
  In April 1974 it was suggested that a relief fund should be established. As a result of that suggestion a fund was set up, and it was recently announced in the Press that the sum contributed by the authorities involved was £80,000 plus interest to the date of final distribution. It is a condition of payment from the fund that the grower concerned shall waive all legal rights to recovery of his losses by any other means. Although the fund is not in accord with the estimated actual losses, it is none the less clearly the objective of the contributing authorities to provide some substantial measure of relief. Although it is disappointing to learn that payment is not expected for some time, one must be grateful for the response so far shown. It is, however, disappointing that the fund is considered to be final.
  In the early part of this year a number of growers were alarmed to see what was considered to be a recurrence of the symptoms suffered in 1973. Initial analysis has indicated that levels of TBA are present on at least four nurseries which have suffered damage. Two of those growers are currently facing the prospect of bankruptcy. The losses suffered this year by the four nurseries
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  are currently estimated to be about £25,000.
  When advised of the further outbreak, the authorities began to carry out investigations. On 10th June the Ministry of Agriculture, Fisheries and Food advised one of my constituents in Latchingdon that there was sufficient TBA in his soil to cause distortion in tomato plants. Subsequently, lower but nevertheless material levels of TBA were found in the soils of other nurseries.
  As a result of these findings, representations were made to the authorities as to the possibility of helping out growers who were in a desperate financial situation not only in terms of compensation but also in respect of specific advice as to what future they had, if any, in growing commercial crops on contaminated soil. The initial response from the authorities was extremely helpful, but on 15th June the firm concerned stated that it did not consider that the levels of TBA present in the soil correlated with the observed damage. It also suggested that various husbandry practices might have had an influence and that another chemical was present in the soil. One might find it surprising, if another chemical was present, that the firm did not indicate its name to the grower concerned.
  On 29th July the Anglian Water Authority advised that the chemical concerned was Picloram, which is another herbicide used as a weed killer. Investigations have shown that that herbicide has never been used at any of the nurseries involved and that it is used in conjunction with 2–4–D, yet another of the herbicides used in daily life. It is interesting to note that 2–4–D was found at one of the affected nurseries in 1973, and at that time TBA was thought to be totally responsible for the damage suffered.
  Some chemists also advise that Picloram would potentiate with TBA, or vice versa. Whatever the precise cause, the fact remains that it would appear that waterborne contaminants caused damage in 1973 and that effects were left—which may have been exacerbated since—which have produced further damage and taken good, honest, industrious growers to the point of bankruptcy.

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  As for the suggestions of bad husbandry, these could be answered in specific terms. It is alleged that one grower in particular used a tomset and that its improper use led to plant damage. It is quite clear that damage to three trusses on the damaged plants existed before the Ministry of Agriculture advised the grower concerned to use tomset, and in any event that advice was not followed.
  One can have only the greatest sympathy with the attempts of manufacturing industry to control minute amounts of chemicals escaping into watercourses. One can have only the greatest sympathy with water authorities which have to control chemical substances capable of detection only by the most sophisticated methods. Notwithstanding that, my constituents have suffered grave damage and appear to be suffering further damage. It seems vital that some action to help the growers should be mounted immediately.
  That action can be best defined under three headings: first, the setting up of a properly-integrated programme of research leading to the provision of good advice to growers; second, the provision of adequate compensation to the growers not only for the loss of revenue but also for the very heavy costs they have to bear; and third, the setting up of control procedures which will ensure the impossibility of a like event happening again. This must be coupled with an overall improvement of the water quality in Essex, which has been the subject of considerable criticism in past years.
  I hope that the Government will consider most sympathetically the position of these growers, all of whom operate on a relatively small scale, and will be able to express that sympathy in some positive form.
  11.21 p.m.
  The Minister of State, Department of the Environment (Mr. Denis Howell): I open by expressing appreciation to the hon. Member for Maldon (Mr. Wakeham) not only for raising this matter on behalf of his constituents but for the reasonable and constructive way in which he has done so and for giving me adequate notice of the various points he wished to raise. I am sure he will appreciate that all these matters arose from happenings in 1973, which was not only before the
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  present Government took office but also before the water service of the country was reorganised.
  Mr. Wakeham Mr. Wakeham indicated assent.
  Mr. Howell: I am glad the hon. Gentleman is in agreement. Nevertheless, I have tremendous sympathy with the plight of his constituents, although I must confess that I have had great difficulty in finding where ministerial responsibility lies. But I have done my best, and will continue to do so, to help the hon. Gentleman.
  The hon. Gentleman has said rightly, that the damage was attributed to the presence of a chemical known as TBA in the water supply. This is used in the manufacture of herbicide, and a quantity entered the river system from the factory and found its way into the water supply.
  I emphasise that there was no medical risk from the concentrations found in the water; there was no risk to human beings, animals or fish. No other crop was affected. But tomato plants are peculiarly sensitive to this chemical, even in concentrations as low as one part in very many millions. That is the extraordinary set of circumstances which has led to these difficulties. Special measures were taken to arrest the discharge of this pollutant immediately it was discovered. Special measures have continued since to protect growers from any recurrence from this source.
  I understand from the Anglian Water Authority that last October it and others concerned decided to set up the fund to which the hon. Gentleman has referred as a gesture of sympathy to the growers and to provide some measure of relief. The authority tells me that it has consulted and agreed with growers' representatives about terms for distributing the total sum of money contributed. The NFU has asked the growers whether they want to participate in the scheme, and some of their replies are still awaited.
  It occurred to me that the hon. Gentleman, who has been so reasonable and constructive, could well have criticised the delay in the distribution of the fund and had he done so I would at first glance have had considerable sympathy with him. However, I am advised that not all the growers have stated yet whether they wish to participate in the scheme.

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  The hon. Gentleman will understand that my Department has no responsibility for the fund or for the arrangements made for distributing it, and I cannot therefore comment on particular points which might occur out of what is really the distribution of ex gratia payments.
  Steps were taken to prevent a recurrence of the 1973 trouble. Effluent from the TBA manufacturing plant at the factory concerned has not been discharged into the river system since but has been tankered away for safe disposal. Daily samples of the remaining effluent from the factory are analysed for TBA. The water authority regularly monitors a number of different points in the river system for TBA. These are in the River Cam system, the Ely-Ouse system at Denver and at Black Dyke Farm. It has also completed a special sampling programme on Abberton and Hanningfield reservoirs. These special tests for TBA are in addition to the normal monitoring programme which tests for up to 45 different substances in the water.
  This programme goes on throughout the whole of the water authority's area. As an example, the routine programme in Essex includes 14 separate sampling points on the River Stour downstream of the point where Ely-Ouse water enters it, and nine points on the River Pant and the non-tidal Blackwater below the Ely-Ouse entry.
  This will give the House an indication of the constant and careful check maintained by water authorities on river water quality. Of course, numerous further checks are made as the water goes from river to treatment works and through the various processes before it is considered fit to enter the mains supply. The ultimate and continuous test is that the water should be safe and wholesome for domestic use.
  The hon. Gentleman will realise that problems such as that which arose in Essex in 1973 are very difficult to anticipate. This happens because of the complex chemical nature of many effluents discharged to river systems, the very diverse uses to which water is put and the exceptionally low concentrations at which some substances can produce undesirable effects. For example the concentration of TBA, about which the hon. Gentleman is concerned, in water sufficient
  184
  to damage young tomato plants is close to the extreme limits of detection even with the most sophisticated methods of analysis.
  The hon. Gentleman has raised the question of the level of spending by water authorities in connection with water quality control. This, as with other spending, must be a matter for them to decide within available capital investment and the need to contain increases in charges in the interests of consumers. But am satisfied that water authorities are very well aware of their responsibilities for water quality which is central to their functions. They give full priority to the protection of water put into public supply.
  I should like to comment on damage to tomato plants this year. The Anglian Water Authority has had two cases reported to it. The natural reaction was that the damage might have been caused by residual effects following the problems of 1973. The water authority immediately mounted a thorough programme to analyse soil samples from a number of nurseries in the area. I am glad to report that this is continuing. The results indicate that TBA is not the primary cause. I understand that the Ministry of Agriculture advisory service, which has conducted its own tests has now modified its original view that TBA could, I think I am right in saying, have caused the difficulties. The information which the hon. Gentleman quoted about individual cases has now been revised by them in the light of further tests.
  I can imagine that following the events of 1973 people in Essex have asked why they have to use water transferred to their area by the Ely-Essex Ouse system. The answer is that without the extra water from that source, the growing demand in Essex would exceed natural supplies. The major Ely-Essex Ouse scheme was undertaken to augment water in the Stour and Blackwater rivers and to enable increasing demand in Essex to be met until the mid-1980s.
  Natural supplies of water are not, unfortunately for the water industry, distributed evenly throughout the country. The general tendency is obviously for heavy rainfall to take place in the West and to be much more plentiful there than in, say, Essex. It makes sense, therefore, to try to balance these resources. Water is

  185
  transferred from one river basin to another. On a smaller scale, transfers of water from the lower reaches of one river to the upper reaches of another as in the Ely-Essex Ouse scheme also make the maximum use of existing resources. If water which is running to waste can be transferred by river to an area of comparative shortage, the need for water storage can be reduced. Nobody wishes to use valuable land to build reservoirs if this can be avoided.
  Increasingly in this country these processes of recycling and reusing water several times over in the river system and in transferring water from one part of the country where there is an area of plenty to an area where there is great shortage are likely to create difficulties to which the hon. Member has drawn our attention. The Department and the industry are paying close attention to them.
  When dealing with chemicals where very minute quantities can adversely affect horticulture, as in this case, we must be continually on our guard to protect what is a legitimate industrial, farming or horticultural interest. It demands increased vigilance as we use and transfer water in this way.
  The Government and the water authorities are fully apprised of the need for increased vigilance. I am glad to say that a good deal of research is going on into all aspects of water transfers. The Water Research Centre which carries out collective research for the industry is dealing with the problem of continuous monitoring to detect relatively large increases in organic pollutants. The centre is also carrying out research and development into ways of removing such substances. The Central Water Planning Unit has a major research programme on the water quality problems associated with transfers of water between river basins. In short, on the water authority front control has been tightened and research into problems such as these continues. On the horticultural front, the Ministry of Agriculture's
  186
  advisory service is willing to provide advice. I understand that its staff has visited more than half the growers affected in 1973 in the hon. Gentleman's constituency and has found no evidence of damage except in the cases already referred to.
  Tomato plants are particularly susceptible. I understand that the staff of the advisory service are continuing to visit the tomato growers who have been affected. I have no doubt that if the hon. Gentleman wishes to consult them, or if any of his constituents wishes to consult them, the staff will be readily available to make their expertise available to his constituents and also to undertake consultations regularly with the water authorities about the continuing problem which affects us all.
  I am sorry that I cannot add much more this evening to that rather official reply about what the two Departments are doing, beyond expressing our considerable sympathy and assuring the hon. Gentleman that since the Water Act came into operation we have been doing all we can to tighten procedures and to give every assistance to his constituents. I greatly hope that if he has any problems he will continue to be in touch with my Department, on behalf of his constituents.
  For our part we shall be very anxious, because we have so much sympathy with them, to give all the assistance we can. We hope that there will not be any further recurrence of these difficulties. Further tests hold out hope for the belief that this year's difficulties do not come from the cause which was originally thought to be the case. I hope that the hon. Gentleman will accept my assurance of our continuing concern for his constituents and our continuing desire to do what we can to assist them in the great difficulties they have undoubtedly encountered.
  Question put and agreed to.
  Adjourned accordingly at twenty-five minutes to Twelve o'clock.

  HOUSING FINANCE (SPECIAL PROVISIONS) BILL
  Division Lists Nos. 319 to 322

  Division No. 319.]

  AYES

  [8.01 p.m.

  Adley, Robert

  Goodhart, Philip

  Miscampbell, Norman

  Aitken, Jonathan

  Goodhew, Victor

  Mitchell, David (Basingstoke)

  Alison, Michael

  Goodlad, Alastair

  Moate, Roger

  Amery, Rt Hon Julian

  Gorst, John

  Monro, Hector

  Arnold, Tom

  Gow, Ian (Eastbourne)

  Montgomery, Fergus

  Atkins, Rt Hon H. (Spelthorne)

  Gower, Sir Raymond (Barry)

  Moore, John (Croydon C)

  Baker, Kenneth

  Grant, Anthony (Harrow C)

  More, Jasper (Ludlow)

  Banks, Robert

  Gray, Hamish

  Morgan-Giles, Rear-Admiral

  Beith, A. J.

  Griffiths, Eldon

  Morris, Michael (Northampton S)

  Bell, Ronald

  Grist, Ian

  Morrison, Charles (Devizes)

  Benyon, W.

  Grylls, Michael

  Morrison, Hon Peter (Chester)

  Berry, Hon Anthony

  Hall, Sir John

  Mudd, David

  Bitten, John

  Hall-Davis, A. G. F.

  Neave, Airey

  Biggs-Davison, John

  Hamilton, Michael (Salisbury)

  Nelson, Anthony

  Blaker, Peter

  Hampson, Dr Keith

  Neubert, Michael

  Body, Richard

  Hannam, John

  Newton, Tony

  Boscawen, Hon Robert

  Harrison, Col Sir Harwood (Eye)

  Normanton, Tom

  Bottomley, Peter

  Hastings, Stephen

  Nott, John

  Bowden, A. (Brighton, Kemptown)

  Havers, Sir Michael

  Onslow, Cranley

  Boyson, Dr Rhodes (Brent)

  Hawkins, Paul

  Oppenheim, Mrs Sally

  Braine, Sir Bernard

  Hayhoe, Barney

  Page, John (Harrow West)

  Brittan, Leon

  Heseltine, Michael

  Page, Rt Hon R. Graham (Crosby)

  Brocklebank-Fowler, C.

  Hicks, Robert

  Pardoe, John

  Brotherton, Michael

  Holland, Philip

  Pattie, Geoffrey

  Brown, Sir Edward (Bath)

  Hordern, Peter

  Penhaligon, David

  Bryan, Sir Paul

  Howe, Rt Hon Sir Geoffrey

  Percival, Ian

  Buchanan-Smith, Alick

  Howell, David (Guildford)

  Peyton, Rt Hon John

  Buck, Antony

  Howell, Ralph (North Norfolk)

  Pink, R. Bonner

  Budgen, Nick

  Hunt, John

  Price, David (Eastleigh)

  Bulmer, Esmond

  Hurd, Douglas

  Prior, Rt Hon James

  Carlisle, Mark

  Hutchison, Michael Clark

  Pym, Rt Hon Francis

  Carr, Rt Hon Robert

  Irvine, Bryant Godman (Rye)

  Raison, Timothy

  Chalker, Mrs Lynda

  Irving, Charles (Cheltenham)

  Rathbone, Tim

  Channon, Paul

  James, David

  Rawlinson, Rt Hon Sir Peter

  Churchill, W. S.

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

  Rees, Peter (Dover & Deal)

  Clark, William (Croydon S)

  Jessel, Toby

  Renton, Rt Hon Sir D. (Hunts)

  Cockcroft, John

  Johnson Smith, G. (E Grinstead)

  Renton, Tim (Mid-Sussex)

  Cooke, Robert (Bristol W)

  Jones, Arthur (Daventry)

  Rhys Williams, Sir Brandon

  Cope, John

  Jopling, Michael

  Ridley, Hon Nicholas

  Cordle, John H.

  Joseph, Rt Hon Sir Keith

  Ridsdale, Julian

  Cormack, Patrick

  Kaberry, Sir Donald

  Rifkind, Malcolm

  Corrie, John

  Kershaw, Anthony

  Rippon, Rt Hon Geoffrey

  Costain, A. P.

  Kershaw, Anthony

  Roberts, Michael (Cardiff NW)

  Crawshaw, Richard

  Kimball, Marcus

  Roberts, Wyn (Conway)

  Critchley, Julian

  King, Evelyn (South Dorset)

  Rodgers, Sir John (Sevenoaks)

  Crouch, David

  King, Tom (Bridgwater)

  Ross, Stephen (Isle of Wight)

  Crowder, F. P.

  Kirk Peter

  Rossi, Hugh (Hornsey)

  Davies, Rt Hon J. (Knutsford)

  knight Mrs Jill

  Rost, Peter (SE Derbyshire)

  Dean, Paul (N. Somerset)

  Knox David

  Royle, Sir Anthony

  Douglas-Hamilton, Lord James

  Lamont, Norman

  Sainsbury, Tim

  Drayson, Burnaby

  Lane, David

  St. John-Stevas, Norman

  du Cann, Rt Hon Edward

  Latham, Michael (Melton)

  Scott, Nicholas

  Durant, Tony

  Lawrence, Ivan

  Shaw, Giles (Pudsey)

  Dykes, Hugh

  Lawson Nigel

  Shaw, Michael (Scarborough)

  Eden, Rt Hon Sir John

  Le Marchant, Spencer

  Shelton, William (Streatham)

  Edwards, Nicholas (Pembroke)

  Lester, Jim (Beeston)

  Shepherd, Colin

  Elliott, Sir William

  Lewis, Kenneth (Rutland)

  Silvester, Fred

  Emery Peter

  Lloyd, Ian

  Sims Roger

  Emery, Peter

  Loveridge, John

  Sinclair, Sir George

  Eyre, Reginald

  Luce, Richard

  Skeet, T. H. H.

  Fairbairn, Nicholas

  McAdden, Sir Stephen

  Smith, Cyril (Rochdale)

  Fairgrieve, Russell

  McCrindle, Robert

  Smith, Dudley (Warwick)

  Farr, John

  Macfarlane, Neil

  Speed, Keith

  Fell, Anthony

  MacGregor, John

  Spence, John

  Finsberg, Geoffrey

  Macmillan, Rt Hon M. (Farnham)

  Spicer, Michael (S Worcester)

  Fisher, Sir Nigel

  McNair-Wilson, M. (Newbury)

  Sproat, Iain

  Fletcher, Alex (Edinburgh N)

  McNair-Wilson, P. (New Forest)

  Stainton, Keith

  Fletcher-Cooke, Charles

  Madel, David

  Stanbrook, Ivor

  Fookes, Miss Janet

  Marshall, Michael (Arundel)

  Stanley, John

  Fowler, Norman (Sutton C'f'd)

  Marten, Neil

  Steel, David (Roxburgh)

  Fox, Marcus

  Mates, Michael

  Steen, Anthony (Wavertree)

  Freud, Clement

  Mather, Carol

  Stokes, John

  Fry, Peter

  Maude, Angus

  Stradling Thomas, J

  Gardiner, George (Reigate)

  Maudling, Rt Hon Reginald

  Taylor, R. (Croydon NW)

  Gardner, Edward (S Fylde)

  Mawby, Ray

  Taylor, Teddy (Cathcart)

  Gilmour, Rt Hon Ian (Chesham)

  Maxwell-Hyslop, Robin

  Tebbit, Norman

  Gilmour, Sir John (East Fife)

  Mayhew, Patrick

  Temple-Morris, Peter

  Glyn, Dr Alan

  Miller, Hal (Bromsgrove)

  Thatcher, Rt Hon Margaret

  Godber, Rt Hon Joseph

  Mills, Peter

  188

  189

  Thomas, Rt Hon P. (Hendon S)

  Wakeham, John

  Wiggin, Jerry

  Thorpe, Rt Hon Jeremy (N Devon)

  Walker, Rt Hon P. (Worcester)

  Winterton, Nicholas

  Townsend, Cyril D.

  Walker-Smith, Rt Hon Sir Derek

  Wood, Rt Hon Richard

  Trotter, Neville

  Wall, Patrick

  Young, Sir Q. (Ealing, Acton)

  Tugendhat, Christopher

  Walters, Dennis

  Younger, Hon George

  van Straubenzee, W. R.

  Warren, Kenneth

  Vaughan, Dr Gerard

  Weatherill, Bernard

  TELLERS FOR THE AYES:

  Viggers, Peter

  Wells, John

  Mr. Adam Butler and

  Wainwright, Richard (Colne V)

  Whitelaw, Rt Hon William

  Mr. Cecil Parkinson.

  NOES

  Allaun, Frank

  Edwards, Robert (Wolv SE)

  Lewis, Arthur (Newham N)

  Anderson, Donald

  Ellis, John (Brigg & Scun)

  Lewis, Ron (Carlisle)

  Archer, Peter

  Ellis, Tom (Wrexham)

  Lipton, Marcus

  Armstrong, Ernest

  English, Michael

  Litterick, Tom

  Ashton, Joe

  Ennals, David

  Loyden, Eddie

  Atkins, Ronald (Preston N)

  Evans, Fred (Caerphilly)

  Luard, Evan

  Atkinson, Norman

  Evans, Ioan (Aberdare)

  Lyon, Alexander (York)

  Bagier, Gordon A. T.

  Evans, John (Newton)

  Lyons, Edward (Bradford W)

  Barnett, Guy (Greenwich)

  Ewing, Harry (Stirling)

  McCartney, Hugh

  Barnett, Rt Hon Joel (Heywood)

  Faulds, Andrew

  MacFarquhar, Roderick

  Bates, Alf

  Fitch, Alan (Wigan)

  Mackenzie, Gregor

  Bean, R. E.

  Flannery, Martin

  Maclennan, Robert

  Benn, Rt Hon Anthony Wedgwood

  Fletcher, Raymond (Ilkeston)

  McMillan, Tom (Glasgow C)

  Bennett, Andrew (Stockport N)

  Fletcher, Ted (Darlington)

  Madden, Max

  Bidwell, Sydney

  Foot, Rt Hon Michael

  Magee, Bryan

  Bishop, E. S.

  Forrester, John

  Mahon, Simon

  Blenkinsop, Arthur

  Fowler, Gerald (The Wrekin)

  Mallalieu, J. P. W.

  Booth, Albert

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

  Marks, Kenneth

  Boothroyd, Miss Betty

  Freeson, Reginald

  Marquand, David

  Bottomley, Rt Hon Arthur

  Garrett, John (Norwich S)

  Marshall, Dr Edmund (Goole)

  Boyden, James (Bish Auck)

  Garrett, W. E. (Wallsend)

  Marshall, Jim (Leicester S)

  Bradley, Tom

  George, Bruce

  Mason, Rt Hon Roy

  Brown, Hugh D. (Provan)

  Gilbert, Dr John

  Maynard, Miss Joan

  Buchan, Norman

  Ginsburg, David

  Meacher, Michael

  Buchanan, Richard

  Gould, Bryan Gourlay Harry

  Mellish, Rt Hon Robert

  Butler, Mrs Joyce (Wood Green)

  Graham, Ted

  Mendelson, John

  Callaghan, Rt Hon J. (Cardiff SE)

  Grant, George (Morpeth)

  Mikardo, Ian

  Callaghan, Jim (Middleton & P)

  Grocott, Bruce

  Millan, Bruce

  Campbell, Ian

  Hamilton James (Bothwell)

  Miller, Dr M. S. (E Kilbride)

  Canavan, Dennis

  Hamilton James (Bothwell)

  Mitchell, R. C. (Soton, Itchen)

  Cant, R. B.

  Hardy, Peter

  Molloy, William

  Carmichael, Neil

  Moorman, Eric

  Carter, Ray

  Harrison, waiter (Wakefield)

  Morris, Charles R. (Openshaw)

  Carter-Jones, Lewis

  Hart, Rt Hon Judith

  Moyle, Roland

  Cartwright, John

  Hattersley, Rt Hon Roy

  Mulley, Rt Hon Frederick

  Castle, Rt Hon Barbara

  Hatton, Frank

  Murray, Rt Hon Ronald King

  Clemitson, Ivor

  Hayman, Mrs Helene

  Newens, Stanley

  Cocks, Michael (Bristol S)

  Healey, Rt Hon Denis

  Noble, Mike

  Cohen, Stanley

  Heifer, Eric S.

  Ogden, Eric

  Coleman, Donald

  Hooley, Frank

  O'Halloran, Michael

  Colquhoun, Mrs Maureen

  Horam, John

  O'Malley, Rt Hon Brian

  Concannon, J. D.

  Howell, Dennis (B'ham, Sm H)

  Orbach, Maurice

  Conlan, Bernard

  Hoyle, Doug (Nelson)

  Orme, Rt Hon Stanley

  Cook, Robin F. (Edin C)

  Huckfield, Les

  Ovenden, John

  Corbett, Robin

  Hughes, Rt Hon C. (Anglesey)

  Owen, Dr David

  Cox, Thomas (Tooting)

  Hughes, Mark (Durham)

  Padley, Walter

  Craigen, J. M. (Maryhill)

  Hughes, Robert (Aberdeen N)

  Palmer, Arthur

  Cronin, John

  Hughes, Roy (Newport)

  Park, George

  Crosland, Rt Hon Anthony

  Hunter, Adam

  Parker, John

  Cryer, Bob

  Irving, Rt Hon S. (Dartford)

  Parry, Robert

  Cunningham, G. (Islington S)

  Jackson, Colin (Brighouse)

  Pavitt, Laurie

  Cunningham, Dr J. (Whiteh)

  Jackson, Miss Margaret (Lincoln)

  Peart, Rt Hon Fred

  Dalyell, Tam

  Janner, Greville

  Pendry, Tom

  Davidson, Arthur

  Jay, Rt Hon Douglas

  Perry, Ernest

  Davies, Bryan (Enfield N)

  Jeger, Mrs. Lena

  Phipps, Dr Colin

  Davies, Denzil (Llanelli)

  Jenkins, Hugh (Putney)

  Prescott, John

  Davies, Ifor (Gower)

  Johnson, James (Hull West)

  Price, C. (Lewisham W)

  Davis, Clinton (Hackney C)

  Johnson, Walter (Derby S)

  Price, William (Rugby)

  Deakins, Eric

  Jones, Alec (Rhondda)

  Radice, Giles

  Dean, Joseph (Leeds West)

  Jones, Barry (East Flirt)

  Richardson, Miss Jo

  Delargy, Hugh

  Jones, Dan (Burnley)

  Roberts, Albert (Normanton)

  Dell, Rt Hon Edmund

  Judd, Frank

  Roberts, Gwilym (Cannock)

  Dempsey, James

  Kaufman, Gerald

  Robertson, John (Paisley)

  Dormand, J. D.

  Kelley, Richard

  Rodgers, George (Chorley)

  Douglas-Mann, Bruce

  Kerr, Russell

  Rooker, J. W.

  Duffy, A. E. P.

  Kilroy-Silk, Robert

  Roper, John

  Dunn, James A.

  Lamborn, Harry

  Ryman, John

  Dunnett, Jack

  Lamond, James

  Sandelson, Neville

  Dunwoody, Mrs Gwyrteth

  Latham, Arthur (Paddington)

  Sedgemore, Brian

  Eadie, Alex

  Lee, John

  Selby, Harry

  Edelman, Maurice

  Lestor, Miss Joan (Eton & Slough)

  Shaw, Arnold (Ilford South)

  Edge, Geoff

  Lever, Rt Hon Harold

  Sheldon, Robert (Ashton-u-Lyne)

  190

  191

  Shore, Rt Hon Peter

  Thomas, Mike (Newcastle E)

  White, James (Pollok)

  Short, Rt Hon E. (Newcastle C)

  Thomas, Ron (Bristol NW)

  Whitehead, Phillip

  Short, Mrs Renée (Wolv NE)

  Tinn, James

  Whitlock, William

  Silkin, Rt Hon John (Deptford)

  Tomlinson, John

  Willey, Rt Hon Frederick

  Silkin, Rt Hon S. C. (Dulwich)

  Tomney, Frank

  Williams, Alan (Swansea W)

  Sillars, James

  Torney, Tom

  Williams, Alan Lee (Hornch'ch)

  Silverman, Julius

  Tuck, Raphael

  Williams, Rt Hon Shirley (Hertford)

  Skinner, Dennis

  Urwin, T. W.

  Williams, W. T. (Warrington)

  Small, William

  Varley, Rt Hon Eric G.

  Wilson, Alexander (Hamilton)

  Smith, John (N Lanarkshire)

  Wainwright, Edwin (Dearne V)

  Wilson, Rt Hon H. (Huyton)

  Snape, Peter

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

  Wilson, William (Coventry SE)

  Spearing, Nigel

  Walker, Harold (Doncaster)

  Wise, Mrs Audrey

  Spriggs, Leslie

  Walker, Terry (Kingswood)

  Woodall, Alec

  Stallard, A. W.

  Ward, Michael

  Woof, Robert

  Stewart, Rt Hon M. (Fulham)

  Watkins, David

  Wrigglesworth, Ian

  Stott, Roger

  Watkinson, John

  Young, David (Bolton E)

  Strang, Gavin

  Weetch, Ken

  Summerskill, Hon Dr Shirley

  Weitzman, David

  TELLERS FOR THE NOES:

  Swain, Thomas

  Wellbeloved, James

  Mr. Joseph Harper and

  Taylor, Mrs Ann (Bolton W)

  White, Frank R. (Bury)

  Mr. David Stoddart.

INDUSTRY
  British Steel Corporation
  British Steel Corporation
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  Airports Policy
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  British Steel Corporation (Management Salaries)
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  Consumer Advice Centres
AGRICULTURE, FISHERIES AND FOOD
  Green Belt Land (Housing)
  Green Belt Land (Housing)
  Food Imports (Subsidies)
  Food Imports (Subsidies)
  Cultivable Land
  Cultivable Land
  Fishing Organisations (European Community Grants)
  Fishing Organisations (European Community Grants)
  Agricultural Land and Woodland
  Agricultural Land and Woodland
TRADE
  Poland, Czechoslovakia and Romania
  Poland, Czechoslovakia and Romania
  Television and Flat Glass Imports
  Television and Flat Glass Imports
  Air Travel Reserve Fund Agency
  Air Travel Reserve Fund Agency
  Textiles (Import Surveillance)
  Textiles (Import Surveillance)
  Chrome
  Chrome
  Fishing Vessels (Survey Fees)
  Fishing Vessels (Survey Fees)
  Aircraft Noise (Insulation Grants)
  Aircraft Noise (Insulation Grants)
  Commodity Stabilisation
  Commodity Stabilisation
  Non-Scheduled Flying
  Non-Scheduled Flying
  Nation Life (Liquidation)
  Nation Life (Liquidation)
  Trade Marks (Patent Office Fees)
  Trade Marks (Patent Office Fees)
ENVIRONMENT
  High Speed Train
  High Speed Train
  Mileage Allowance (Public Servants)
  Mileage Allowance (Public Servants)
  Railway Employees
  Railway Employees
  Housing (Campbell Report)
  Housing (Campbell Report)
  Conservation Areas (Demolition)
  Conservation Areas (Demolition)
  Building Regulations
  Building Regulations
  Council Housing Improvements
  Council Housing Improvements
  Breathalyser Tests
  Breathalyser Tests
  Northern Region (Ministerial Appointments)
  Northern Region (Ministerial Appointments)
  Petrol (Lead Content)
  Petrol (Lead Content)
  Dutch Elm Disease
  Dutch Elm Disease
  Vehicle Tests
  Vehicle Tests
  Historic Buildings
  Historic Buildings
  Contaminated Soil (Basingstoke)
  Contaminated Soil (Basingstoke)
  Agricultural Land and Woodland
  Agricultural Land and Woodland
  Rent Allowances
  Rent Allowances
  Stretford (Bypass)
  Stretford (Bypass)
  Wood-Wool Slabs (Fire Hazard)
  Wood-Wool Slabs (Fire Hazard)
  Control of Pollution Act 1974
  Control of Pollution Act 1974
  Manchester Ship Canal Company
  Manchester Ship Canal Company
  New Palace Yard
  New Palace Yard
  Council Houses (Renovation)
  Council Houses (Renovation)
FOREIGN AND COMMONWEALTH AFFAIRS
  New Hebrides
  New Hebrides
  Magna Carta (Loan to America)
  Magna Carta (Loan to America)
  Soviet Union (Service Attachés)
  Soviet Union (Service Attachés)
  Rhodesia House
  Rhodesia House
NORTHERN IRELAND
  Roads (Fermanagh and South Tyrone)
  Roads (Fermanagh and South Tyrone)
  Royal Ulster Constabulary
  Royal Ulster Constabulary
  Housing
  Housing
  River Lagan (Fencing)
  River Lagan (Fencing)
  Local Government (Pay Limits)
  Local Government (Pay Limits)
  Remands in Custody
  Remands in Custody
SCOTLAND
  Civil Service (Pay)
  Civil Service (Pay)
  Invalid Vehicles
  Invalid Vehicles
  Textile Purchases
  Textile Purchases
  Disabled Persons
  Disabled Persons
  Crofting Counties
  Crofting Counties
  Chronically Sick and Disabled Persons Act
  Chronically Sick and Disabled Persons Act
  Roads (chippings)
  Roads (chippings)
  Terrorist Activities
  Terrorist Activities
  A74
  A74
  Remands in Custody
  Remands in Custody
  New St. Andrews House (Lighting)
  New St. Andrews House (Lighting)
WALES
  Ministerial Responsibilities
  Ministerial Responsibilities
  Mentally Handicapped Children
  Mentally Handicapped Children
  Sheltered Housing Schemes
  Sheltered Housing Schemes
  Housing
  Housing
  Rate Support Grant
  Rate Support Grant
  Housing (Modernisation)
  Housing (Modernisation)
  Social Services (Recreational Facilities and Amenities)
  Social Services (Recreational Facilities and Amenities)
  Land Acquisition
  Land Acquisition
  Fodder
  Fodder
  Homeless Persons
  Homeless Persons
  Substandard Housing
  Substandard Housing
  Housing Densities
  Housing Densities
EMPLOYMENT
  Trade Unions
  Trade Unions
  Disablement Resettlement Service
  Disablement Resettlement Service
  School Leavers
  School Leavers
  Brecon and Radnor
  Brecon and Radnor
  Footwear Industry
  Footwear Industry
  Cheshire
  Cheshire
  Bury
  Bury
  Thanet
  Thanet
  Unemployed Persons
  Unemployed Persons
  Christmas Cards
  Christmas Cards
  Statutory Minimum Wage
  Statutory Minimum Wage
  Trade Unions (European Community Representation)
  Trade Unions (European Community Representation)
  Industrial Relations (Appeals)
  Industrial Relations (Appeals)
  Redundancy Fund
  Redundancy Fund
  Kirkby Manufacturing & Engineering Co., Ltd.
  Kirkby Manufacturing & Engineering Co., Ltd.
  Dangerous Chemicals (Road Transport)
  Dangerous Chemicals (Road Transport)
  Merseyside
  Merseyside
  Trade Unions (Accounts and Returns)
  Trade Unions (Accounts and Returns)
  Annual Census of Employment
  Annual Census of Employment
  Wigston, Leicestershire
  Wigston, Leicestershire
  Humberside (Caravan Industry)
  Humberside (Caravan Industry)

Preamble
The House met at half past two of the clock: The CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of Southwark.

CHARITIES: BOGUS ORGANISATIONS
Lord VIVIAN: 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 what steps they are taking to prevent bogus charities from operating.
Lord WELLS-PESTELL: My Lords, registration of an organisation by the Charity Commissioners does not indicate that they have approved the organisation or the persons who will run it. The Commissioners have no power to refuse registration on any grounds other than that the trusts declared in the organisation's governing instrument are not charitable in law. The Commissioners have power under Section 6 of the Charities Act to institute an inquiry into the affairs of any charity other than an exempt charity. The investigation of suspected criminal activity is, as your Lordships will appreciate, a matter for the police.
Lord VIVIAN: My Lords, I thank the noble Lord, Lord Wells-Pestell, for that Answer. Would he agree with me that the form which has to be filled in to register a charity with the Charity Commissioners does not adequately serve the purpose and, furthermore, that the Charities Act 1960 needs immediate amendment? Is the noble Lord aware that loopholes which exist have enabled this evil man Roger Gleaves to operate six hostels under his own name, or under the name of the "Count de Giglio"?
Lord WELLS-PESTELL: My Lords, I have some sympathy with what the noble Lord said. I am sure that the noble Lord, as well as your Lordships, will be interested to know that a commit.
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tee has been set up by the National Council of Social Services, under the chairmanship of the noble Lord, Lord Goodman. The Committee is at present considering various aspects of charity law and is expected to make a report at the end of the year. The Education, Arts and Home Office Sub-Committee of the House of Commons Expenditure Committee is also inquiring into the work of the Charity Commission. I am not familiar with the form to which the noble Lord refers, but, with great respect, I suggest that he directs his comments and observations to the Goodman Committee. I am sure that that committee would be glad to have his comments on this matter.
Lord JANNER: My Lords, has my noble friend seen the television exhibition of what happened? In view of the horrific nature of what had been going on for a considerable time, will my noble friend see to it that the committee meets and gives its decision as speedily as possible so that something effective can be done? If my noble friend has not seen the television programme, perhaps he will forgive me if I suggest that he arranges to see it, and then he will, I think, come to the same conclusion as have all of us who have already seen it.
Lord WELLS-PESTELL: My Lords, the question put by my noble friend is probably more applicable to the next Question. We are alive to the situation, and perhaps there is no need for me to say more at this stage.
The Lord Bishop of SOUTHWARK: My Lords, are Her Majesty's Government aware that charities which may be bogus sometimes get support which they might not otherwise get if their prospectuses did not have the words, "the Reverend" in front of the names of various people who are said to be the president, vice-president or organiser? Are Her Majesty's Government aware that there is apparently no rule in this country to prevent any man or woman putting the words, "the Reverend" in front of their names? My noble friend Lady Summer-skill could call herself a Bishop and roam the streets with a cloak and mitre—
Baroness SUMMERSKILL: My Lords, the right reverend Prelate need have no fear, I am not tempted for one moment.
The Lord Bishop of SOUTHWARK: But seriously, my Lords, are the Government aware of this fact?—because it is in my judgment, and I am sure in the judgment of many of us, a very serious matter. Anyone may call himself, "the Reverend" or even "the reverend doctor". I would ask Her Majesty's Government to look at this matter and consider the possibility of all clergymen, including those in the Established Church who call themselves "the Reverend", being registered, perhaps with the Charity Commissioners, so that people may be able to make inquiries about all those who have this prefix to their names.
Lord WELLS-PESTELL: My Lords, the right reverend Prelate has raised another matter entirely. I will take note of what he said. My only comment is that it might be good if people who are highly placed in the community did not associate themselves with certain charities unless they are satisfied that they are bona fide charities.
Lord LEATHERLAND: My Lords, is the noble friend aware that at the present time almost any crook can get himself, or a body which he organises, registered as a charity? Would it not be proper for the Charity Commissioners to be told that, when an application is made for registration as a charity, they should cause inquiries to be made by the local police about the promoter?
Lord WELLS-PESTELL: My Lords, I cannot add anything to what I have already said namely, that there is a committee inquiring into the whole field. I think that we ought to wait until it publishes a report, which is due certainly by the end of this year.
Lord VIVIAN: My Lords, I thank the noble Lord for his last answer to me. In view of the fact that he was very courteous to me last Thursday and gave me a few minutes of his time to discuss matters, may I meet him after Question Time, or at any time suitable to him, to show him some documents that I have?
Lords WELLS-PESTELL: My Lords. I am always prepared to see Members of your Lordships' House.
Baroness SUMMERSKILL: My Lords, will my noble friend consider this
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point? Would not the public be safeguarded if the officials of a charity were appointed by an independent authority, and not by the organiser of the charity?
Lord WELLS-PESTELL: My Lords, I agree with my noble friend that this is a matter that needs to be looked at and perhaps I will assume some responsibility for letting the Goodman Committee know what has transpired in your Lordships' House today.

HOSTEL ACCOMMODATION
2.44 p.m.
Lord VIVIAN: 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 the Department of Health and Social Security provided a sum of around £1,000 for some juvenile boys to be housed at hostels presided over by Mr. Roger Gleaves and whether the Department had inquired into the character of Mr. Gleaves prior to sending them there.
Lord WELLS-PESTELL: My Lords, no grant of any kind has been paid to the organisation under discussion, but payments for supplementary benefit have been made for individual claimants aged 16 or over to enable them to meet the charge for accommodation in homes associated with Mr. Gleaves. Most of these people were already living in the homes when they claimed benefit. Local social security officers do not direct homeless claimants to particular addresses.
Lord VIVIAN: My Lords, I thank the noble Lord for that Answer. May I ask whether he does not think it is the duty of the Department of Health and Social Security to concern themselves with what type of homes these people are living in and whether the homes are being properly conducted?
Lord WELLS-PESTELL: My Lords, I cannot accept what the noble Lord has said. I do not think that this is a duty on the part of the Department of Health and Social Security, nor do I think it should be. Their responsibilities are clearly defined by a number of Acts of Parliament. Their particular function is

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to relieve stress and to provide a person with the means of living, and it does not go beyond that. If a person happens to be in a home or hostel, he can be helped by what is called the "voucher scheme", where the claimant gets a certain amount of pocket money each week and the hostel gets the amount he claims within the terms of the Supplementary Benefit Commission. I do not think it would be reasonable to expect the Department to make the inquiries that the noble Lord has suggested, or even to carry out inspections.
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, I ask this question out of curiosity. Has the noble Lord any information as to how this person got away with it for so long, and on such a big scale?
Lord WELLS-PESTELL: My Lords, that would need a long answer. I can only say that persons who are setting up homes and hostels for young people are obliged to register them with the Secretary of State for Social Services, but as Mr. Gleaves decided to offer facilities not only for young people but over a very wide age range he was not required to register. That may well be a weakness that has to be rectified in the not too distant future. This is just one of the difficulties.
Baroness VICKERS: My Lords, may I ask the noble Lord whether he would consider calling together the various representatives of these organisations which provide hostels? I am interested in, for instance, the London Centre, which provides hostels for girls as well as boys, and I think there is already a need for co-ordination in their work.
Lord WELLS-PESTELL: My Lords, I am grateful to the noble Baroness for her comments. Immediately this situation came to light, the Department of Health and Social Security, the Home Office, representatives of the voluntary organisations and representatives of the London Boroughs Association, the municipal boroughs, met and formed a committee. They now meet regularly to consider every aspect that has emerged from this situation.
Baroness VICKERS: My Lords, does that include the voluntary organisations?
Lord WELLS-PESTELL: My Lords, I thought I said that it did. If I did not, I say it now.
Lord SEGAL: My Lords, could not a closer scrutiny be exercised in cases where hostels are run by people with a previous criminal record?
Lord WELLS-PESTELL: My Lords, there is some difficulty in that respect. At one period, the Charity Commissioners had powers to take some action in a case which involved a person who had a criminal record, but this power was removed by an Act of Parliament which was passed in 1967. As a result, notwithstanding his previous conviction, a person could continue to register a charity.
Lord VIVIAN: My Lords, after what has been said, does the noble Lord not think, quite honestly, that it is a ridiculous state of affairs which must be put to rights immediately?
Lord WELLS-PESTELL: My Lords, this is the whole purpose of having this ad hoc committee. May I give the House some further information? Under the Charities Act 1960, the Commissioners had power to remove from office any trustee who had been convicted of a felony, and that power was removed by the Criminal Law Reform Act 1967. But I think we are coming to grips with this problem.

DESALINATION
Lord BALFOUR of INCHRYE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will publish in the form of a White Paper or by other suitable means a report of progress over the last two years in the development of desalination; and whether they will include in this report details of monies allocated to this work either directly or through Government agencies, the extent to which desalination is being used commercially in the United Kingdom and overseas, and any proposed future development.
The PARLIAMENTARY UNDERSECRETARY of STATE, DEPARTMENT of the ENVIRONMENT (Baroness Birk): My Lords, a report on desalination was published by the Water Resources Board in 1972. The Government are satisfied that the developments in technology since 1972 do not merit a further report at this stage.
Lord BALFOUR of INCHRYE: My Lords, can the Minister give an assurance that that rather unsatisfactory Answer does not signify a lack of interest and enthusiasm by Her Majesty's Government for the development of desalination? Furthermore, is she aware that in America much money is being spent and progress made in reducing the costs and energy required for this process; and that we in this country must not be left behind?
Baroness BIRK: My Lords, here I am afraid I cannot be more satisfactory; and I think I am going to be more unsatisfactory to the noble Lord. So far as this country is concerned this is an extremely expensive and uneconomic exercise. Large-scale desalination is used in countries which have large energy resources but little water; but this does not apply in this country. The Water Resources Board found that water from desalination costs between two and a half times and fifteen times as much as water from conventional sources. We have no plans for further development at the present time and, considering the demands on other aspects of public expenditure, I am sure that the noble Lord will appreciate this.
Lord BALFOUR of INCHRYE: My Lords, perhaps the Minister has not understood the purpose of my Question. It was not regarding the use of desalinated water in this country, but with production of desalination plant by this country for sale in other parts of the world, such as J. and G. Weir are doing very successfully in Scotland. Is the noble Baroness aware that water may be more expensive from desalination plants in this country, but in the Persian Gulf it is cheaper to use the desalination process than to import fresh water at a cost of several hundred pounds a ton in shipping charges? This country must not be behind in this new technology.
Baroness BIRK: My Lords, I thought I was covering both points. Our support
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for research in 1974–75 totalled £90,000. In 1975–76 we are giving no direct support to research. The Water Research Centre, which receives grant from the Department, is maintaining an oversight on developments in this technology. We have up to now, with the Ministry of Overseas Development, given aid for this. We have now reached the point where we do not think we can do much more at the present time.
Lord JANNER: My Lords, may I ask my noble friend whether she is aware that desalination is an extremely important feature of an attempt to solve some of the world's problems as a whole? We should be participating in this important effort, and exercising all possible care and using whatever influence we can, apart from providing machinery, in order to provide pure or clean water for the various nations of the world who are suffering as a consequence of lack of it for irrigation as well as other purposes.
Baroness BIRK: My Lords, I accept that it is an important matter. The research side is now being left to industry as a matter for their commercial judgment. It is true, as I think I should perhaps have mentioned to the noble Lord, that British industry gained an average of 8 per cent. in the open market contracts over the past four years. That does not seem a great amount, but when compared with other sides of industry it is a big percentage in this area. It would he wrong for me to hold out false hopes that at the present time we are doing anything major in this field.
Lord NUGENT of GUILDFORD: My Lords, is the noble Baroness aware that although the present steep rise in fuel costs prevents desalination from being a proposition in this country, the Water Research Centre has commissioned a project of research into improved membranes for the reverse osmosis process? This is principally directed to the cleaning of effluent, but nevertheless it could in the future have an advantage to desalination. That might be of some comfort to my noble friend.
Baroness BIRK: My Lords. I said that the Water Research Centre, which receives a grant from the Department, was maintaining an oversight, and it is expected to devote about one man year to desalination in 1975–76 at a cost of

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about £13,500. Half of this sum will be paid by Government grant. This work, as the noble Lord pointed out, is the initiative of the Water Research Centre.
Lord PEDDIE: My Lords, would my noble friend agree that British water engineers and consultants have made a greater contribution than any other single nation to the development of desalination plants throughout the world, particularly the Middle East?
Baroness BIRK: My Lords, yes, we did originally. What has happened since is that many countries are now producing their own plant; and, unfortunately, the most underdeveloped countries have not access to the cheap energy resources, and their own sources of water prove more economic, except in a country like Israel, which in fact now produces her own water supplies.

NIGERIA: PROPOSED STATE VISIT
2.55 p.m.
The Earl of LAUDERDALE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether the Queen's State Visit to Nigeria will proceed in October as planned.
The PARLIAMENTARY UNDERSECRETARY of STATE, FOREIGN and COMMONWEALTH OFFICE (Lord Goronwy-Roberts): My Lords, as my right honourable friend said in another place on 29th July, it is still too early to say whether or not Her Majesty will visit Nigeria in October. We look forward to enjoying close relations with the new Nigerian Government as we did with the old.
The Earl of LAUDERDALE: My Lords, may I thank the noble Lord for that reply. While appreciating that this may be a delicate matter at this time, may I ask the noble Lord whether he would concede that, first of all, it is in the interests of us all to maintain and develop the best possible relations with Nigeria; and, secondly, might it not smack of a breach of the principle of noninterference if we appear to exercise
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some judgment about the new regime in Nigeria?
Lord GORONWY-ROBERTS: My Lords, I am quite sure that the whole House will agree with the noble Earl that we should re-affirm our strong ties with Nigeria as a fellow Member of the Commonwealth, of which Her Majesty is the Head. I do not think there is any danger at this juncture of our so comporting ourselves in the affairs of Nigeria as to give them any impression that we are unduly interfering with their internal affairs. The new Head of State, who in the past few days has in fact received the accolade of the former Head of State, has indicated that he will continue the same policies, even though he will seek, as he sees it, new efficiencies.
Lord SOMERS: My Lords, would my noble friend agree that it is very difficult to exercise judgment on the present regime without exercising exactly equal judgment on the preceding one which did exactly the same thing?
Lord GORONWY-ROBERTS: My Lords, I do not think that we are called upon to exercise judgment on either régime.
Lord GRIMSTON of WESTBURY: My Lords, would the Minister agree that a coup is becoming the accepted method of changing a government in Africa, rather than any democratic process such as we understand?
Lord GORONWY-ROBERTS: My Lords, yes, this may be true. But I suggest that there are coups and coups.

McDERMOTT SCOTLAND ORDER CONFIRMATION BILL
Considered on Report.
Then, Standing Order No. 44 having been suspended (pursuant to Resolution) read 3a, and passed.

LOTTERIES BILL
The MINISTER of STATE, HOME OFFICE (Lord Harris of Greenwich): My Lords, I beg to move that the Commons Amendment to one of the Lords Amendments and the Commons Amendment in lieu of one other of the Lords Amendments be now considered.
Moved, That the Commons Amendment to one of the Lords Amendments and Commons Amendment in lieu of one other of the Lords Amendments be now considered.—(Lord Harris of Greenwich.)
On Question, Motion agreed to.

COMMONS AMENDMENT TO ONE OF THE LORDS AMENDMENTS AND COMMONS AMENDMENT IN LIEU OF ONE OTHER OF THE LORDS AMENDMENTS.
[References are to Bill (189) as first printed by the Lords. Commons Amendments are printed in italics.]

LORDS AMENDMENT
[Nos. 1 and 2.]
After Clause 17, insert the following new clause:
Commencement orders
(".The Secretary of State shall not make an order under section 19(5) hereof until draft regulations shall have been made under section ID above and such draft regulations have been laid before, and approved by, resolutions of both Houses of Parliament")
The Commons agree to this Amendment but propose the following Amendment thereto:
Line 2, leave out from ("19(5)") to the end and insert ("below appointing a day for the coming into operation of section 1 above until he has made regulations under section 10 above which provide for their coming into operation on that day.
(2) Regulations so providing shall not be made unless a draft of them has been approved by resolution of each House of Parliament")
Lord HARRIS of GREENWICH: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 2 to the Lords Amendment No. 1. I think it will be for the convenience of the House if I also deal with Amendments Nos. 3 and 4. The Amendments made in another place have the effect of securing the substance of the Amendments made to the Bill by your Lordships' House while removing their undesirable and inconvenient side effects. The intention of your Lordships' House was to require that the first and main set of regulations should be subject to Affirmative Resolution by both Houses of Parliament.
The Government had not thought the Affirmative Resolution procedure was essential in these circumstances. But we fully accept the desirability of there being ample discussion and consideration before the main regulations under this Bill are made, and the Government have there
1316
fore agreed to the Bill being amended so that these regulations will require an Affirmative Resolution by each House. However, the Amendments made by your Lordships' House were not only technically defective, but they also prevented Clause 13 (the clause designed to give immediate assistance to the voluntary organisations and other bodies at present operating lotteries under Section 45 of the Betting, Gaming and Lotteries Act 1963) from being brought into operation before the rest of the Bill. The Amendments which have been made in another place, and which I now commend to your Lordships while securing the Affirmative Resolution procedure for the main regulations, will enable Clauses 13 and 14 and the consolidation Amendments to be brought into operation before the regulations have been made. But the Bill in this form will prevent the principal provisions of the Bill, which depend on Clause 1, being brought into operation until the regulations have been approved in draft and made. I beg to move.
Moved, That this House doth agree with the Commons in their Amendment No. 2 to the Lords Amendment No. 1.—(Lord Harris of Greenwich.)
Earl COWLEY: My Lords, I should like to thank the Government and the other place for accepting the substance of the Amendment of this House to require the Secretary of State to lay regulations before both Houses for Affirmative Resolution. I think it is an important item in the Bill. The powers under Clause 10 are extremely wide and I am glad that the Government and another place have accepted the wisdom and the arguments in favour of having the Affirmative Resolution procedure applied to Clause 10.
I also think that the Commons Amendments are a good compromise between the original Amendments put forward by this House and the need to bring in Clause 13 as soon as possible. Since the Government argued, when these clauses were debated in this House, that Clause 13 was of paramount importance and needed to be brought in urgently, perhaps the noble Lord, Lord Harris of Greenwich, could give me a date when the Government hope to bring this clause into effect. I realise that many consultations are needed before any of the draft

1317
regulations will be brought before either House; but could the noble Lord give any idea of the time-scale which is envisaged for these draft regulations to be brought before each House? We on this side do not like this Bill, but the Affirmative Resolution procedure makes it slightly more palatable and it gives both Houses some control over its future operation.
Viscount MONCK: My Lords, as your Lordships know, I can never read Parliamentary language, and before the noble Lord, Lord Harris of Greenwich, replies, I should like, if possible, to get this clear. In the Commons Amendment, which seems extremely sensible, it is proposed as follows:
"Line 2, leave out from ('19(5)') to the end and insert…"
The only place I can find "19(5)" is in line 3 in Clause 18. May I ask whether "Line 2" is correct?
Lord HARRIS of GREENWICH: My Lords, perhaps I might deal with the noble Earl's points first and then later with the noble Viscount's point. Clause 13 will be brought into effect quite soon, and I will let the noble Earl know the precise date. I fear that I cannot at the moment give him any indication of the time-scale for the remainder because, as he indicated, there will need to be discussions with the local authority associations and others. Obviously, we shall do it as soon as possible.
Referring to the noble Viscount's point, the Amendment here referred to is the Amendment to the Lords Amendment No. 1; so one has to look at the Amendment and not at the Bill.
On Question, Motion agreed to.

LORDS AMENDMENT
[Nos. 3 and 4.]
Clause 18, page 11, line 13, at beginning insert:
("After the commencement of this Act")
The Commons disagree to this Amendment but propose the following Amendment in lieu:
Page 11, line 15, after ("below") insert ("or of regulations of which a draft has been approved by resolution of each House of Parliament,")
Lord HARRIS of GREENWICH: My Lords, I beg to move that this House doth not insist on their Amendment No.
1318
3, to which the Commons have disagreed, and doth agree to the Commons Amendment No. 4 in lieu thereof.
Moved, That the House doth not insist on their Amendment No. 3, to which the Commons have disagreed, and doth agree to the Commons Amendment No. 4 in lieu thereof.—(Lord Harris of Greenwich.)
On Question, Motion agreed to.

COMMUNITY LAND (No. 2) BILL [H.L.]
3.5 p.m.
Baroness BIRK: My Lords, I beg to move that the Bill be now read a second time. Since the original Bill was introduced in another place on 12th March 1975, there has been no shortage of comment. Many thousands of words have flowed under the verbal bridges of Parliament, the Press, organisations and individuals. But in this torrent of verbiage the principles of the Bill must not be lost sight of. These are simple and were set out in the White Paper last September: first, to enable the community to control the development of land in accordance with its needs and priorities; and, secondly, to restore to the community the increase in value of land arising from its efforts. Strengthening the planning system is essential for these objectives, and this is achieved by moving forward from planning by control to a more constructive and imaginative concept; in other words, positive planning.
The limitations of our present system are well summed up in paragraph 21 of the White Paper, which says:
"Market forces encourage concentration of commercial development in areas that seem to offer special advantages to particular firms; but what the market does not consider are the side effects—the breakdown of old-established communities and the increasing desertion of city centres—and their implications, not the least beng the effect on the transport system of requiring people to live so far from their workplaces. There are costs involved—the cost of providing more roads, more trains and buses for example: and there are stresses, too, on the individual who has to spend time and money, probably in crowded conditions, travelling to and from work. These costs and stresses are not taken into account by the market, but they should be by the planning authorities. It is important that they are, and this is why planning must be strengthened, and why the community should buy the land and benefit from the development values created"

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If you want to use a pair of scissors you need two blades for it to work. Planning is one blade, ownership the other. The marriage of planning and ownership is not a new idea. The great 18th century landowners used ownership with careful planning and produced an integrated community pattern of house, village and landscaping. Though, socially and economically, that pattern is out of tune with contemporary times, it illustrates that ownership and planning go together like love and marriage in the song: "You can't have one without the other". Indeed, without it our heritage would be greatly diminished. More recently, a similar marriage has produced some of the best examples of planning by the community: there are the new towns—an exciting concept—and the rebuilding of the centres of some of our cities of which Plymouth and Coventry are two examples.
However, for planning and ownership to work socially in the modern context the development value of land must go to the community. Without the community, which is the creator of land-demand and the provider of services, land would have little value. Many people believe the solution lies in taxation. Taxation is a financial spoon which can scoop off some of the market cream, but on its own cannot achieve the social and economic objectives of community ownership at current use value. However sacred the ownership of development land is considered to be, it is far too important to the public to be left in private hands.
The Government believe that the increased value which development land attracts should go to the people rather than drop into private hands as windfall profit, is there anybody in this House who really believes that the owner of, say, farmland who obtains a planning permission to change the use to offices and houses should receive a 100-fold increase in value simply as a result of the grant of that planning permission? There are those who contemptuously dismiss public ownership of development land as a doctrinaire solution, but even they cannot ignore the fact that the Government's commitment has the sound backing of an eminent independent committee—the famous Uthwatt Committee on Compensation and Betterment which reported in 1942.
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A key feature of the Uthwatt Report was the recommendation that land should be bought by the community when it was ready to be developed, whether publicly or privately. This radical recommendation was not accepted by the Coalition Government of the day. They proposed, instead, an 80 per cent. betterment charge with only reserve powers of public acquisition, and this approach was later translated into the 1947 Act. Maybe this planning control was as much as local authorities—and possibly public opinion—could accept at that time; and the benefits that have flowed from these planning provisions are considerable. But we believe Uthwatt's basic case for ownership was right, and that the time has come to take this further step.
This means the community taking over the land owner's role so far as development land is concerned. It will be the community that has the duty to make land available for development, at the right place and at the right time, to meet the peoples' planning needs. This does not mean the community has to own all land. It steps in only at the point of development. So the great majority of existing owners and occupiers will not be touched by the scheme at all.
The scheme creates a new positive duty for authorities to make land available for development, but it does not mean they will carry out all development. Land will still be made available for private development. Private house-building will still be done by private builders, and those who buy houses for their own occupation will generally be able to buy the land freehold. There is no truth in the myth that the scheme will lead to a check in the growth of owner-occupation. More positively, the new duties under the Bill should improve the supply of land for private development. Many developers will surely welcome a situation in which there is an assured supply of land so that they do not have to put so much effort into searching out sites and tie up their capital in building up their own land-banks.
On the two previous occasions when we dealt with land reform we set up new central bodies: the Central Land Board in 1947 and the Land Commission in 1967. Neither was successful, partly because they did not have sufficient time to develop before they were repealed

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and also, I believe, because there was little taste for large remote central concentrations of power. For this reason we propose that acquisition of land under the scheme should generally be the responsibility of local authorities. This conclusion is in line with the general emphasis today on participation, dispersal of power and devolution. This applies to our proposals for Wales where a new Land Authority will operate the scheme in close consultation with the local planning authorities.
Of course, the Bill will put important new power in the hands of the local authorities, and it is quite clear that some people do not like this delegation. But those who have protested vigorously about the way power has, over the years, been taken away from democratically-elected authorities should be delighted. What I cannot understand is how those who freely accept that local authorities generally act in a responsible and proper fashion prematurely assume that the same authorities will abuse these new powers. I do not believe the scheme will increase the scope for corruption. Let us not deceive ourselves; many situations—they are with us all the time—produce dangers of corruption, and some members and officers have abused their positions. But in relation to the opportunities available local authorities have quite a clean record.
Here I would make two points. First, the present situation, when at the stroke of a pen a local authority can increase the value of land one-hundred fold, carries far greater risks of corruption than will exist when the grant of planning permission conveys no value for the owner. Secondly, we are determined the land scheme should be operated with maximum open local government, as provisions in the Bill covering the keeping of registers of land holdings and their accessibility to public inspection indicate. Since something like 50 per cent. of development land is already bought by public authorities for their own use, and a number are regularly buying land for private development, they are no strangers to the role they will be playing under the land scheme. So it just is not true to say they have not the experience or ability to take on the task. Indeed, many authorities will be able to begin implementing the scheme
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quickly without any significant increase in staff. A key advantage of using local authorities is that we can build on what is there. This will mean that progress will not be uniform in all areas—nor should it, or could it, be. Some authorities will be able to move faster than others; this is an important example of the flexibility built into the scheme.
From the start, the price of land for local authorities' own use will be reduced—and therefore the cost of local authority housing, schools and open spaces. This will enable community facilities not only to be provided but, just as important, to be provided in the right places. Local authorities will finance their new purchases of land for private development by borrowing. They will keep separate accounts for this purpose and will be allowed to borrow not only to finance capital spending but also to meet costs of administration and interest charges. In fact, they will operate just like private developers who finance their operations by borrowing, and pay off their borrowing when they sell land.
The scheme, therefore, does not mean an increase in local authority rates. Nor is there any truth in the argument that all profits will be swallowed up in interest charges. This probably derives from the mistaken impression that authorities will have to build up 10-year land-banks. It was made clear in the White Paper, and repeated in the Bill, that 10 years is the period over which they will look ahead to see that community needs are met with imagination and economic foresight. In the early years especially, authorities will be encouraged to plan their acquisitions with early disposal strongly in mind; and the Secretary of State will give close attention to this before approving local authority programmes. So any land-happy authorities will not be able to carry their recklessness far.
In the longer term, the scheme will bring financial benefits to the local authorities. When an authority's accounts come into overall cash surplus a share of the surplus will he available to the authority and they will be able to use this to finance projects which would otherwise have fallen on the rates. This is a point of great importance to ratepayers. It works like this. When there is a surplus in a land account 40 per cent. goes to

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the Exchequer, 30 per cent. to the local authority, and 30 per cent. to a pool for redistribution among local authorities. As progress will be uneven, initially this 30 per cent. pool will be used to reduce deficits in the accounts of those authorities making slower progress.
The Bill is a radical measure, but fashioned with a Fabian approach. And it is the need to phase the introduction of the scheme carefully which has inevitably made it more complex. The principles, as I have explained, are simple; and the full scheme—when authorities are buying virtually all development land at current use value—is also in essence simple. But the mechanics of progression to the final goal described in the White Paper as the transitional arrangements" are more complicated. I do not intend to explain the mechanism in detail. Yet the general principle of phased introduction is so important that I feel I must outline the position now. The details will, of course, be discussed in Committee; and I shall be making available to your Lordships in good time notes on the clauses. An essential part of the move to the full scheme will be the subject of another Bill—the Development Land Tax Bill—to be introduced next Session.
Our aim is current use value—a situation where all land changes hands at a value based on its current use, and where development value is realised only by the community. But to move to this overnight would be quite wrong. It would certainly he unfair to owners who have paid development value prices for land in recent years. At the same time, from the start the price of land will be brought down for authorities. Our method of achieving these two aims is through the development land tax which will be charged at 80 per cent., thus leaving with the owner 20 per cent. of the development value that accrues to him after tax—not to be sniffed at. Authorities will pay for land minus the tax, thus paying less for development land. However, the owner will receive what he would have been left with after paying the tax if he had sold privately.
What, then, is the position on Day 1—that is, the First Appointed Day? Under this Bill there will be new powers and duties for authorities to buy development land, and under the Development Land
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Tax Bill there will be a new tax and arrangements for authorities to buy net of this tax. At the end of the working-in period is the Second Appointed Day when the full scheme, with acquisition at current use value, comes in. Between these two dates the powers and general duties are progressively converted into a "full duty" under Clause 20 to buy all land needed for development. This full duty is brought in by order and, I repeat, progressively by area, by type of development, and by scale of development, and all consonant with the ability and resources of authorities.
Let me illustrate this point. The Secretary of State could bring in the full duty in, say, a county by designating housing development on sites of over five acres. Authorities in that county would then have a duty to buy these, but other development could go on as before. The scope of the duty would be increased with the capacity of the authorities in each area, but it would never embrace all development. For example, the building of a single house would always be outside the duty zone. It is this flexibility which is an essential feature of the scheme. It means the Secretary of State can monitor progress and fit the scale of activity to the availability of resources—both nationally and locally. It means the transition from the present market to a new land market can be properly managed, both to achieve equity and to protect essential development programmes.
I appreciate that there must be certainty for those involved in development if the partnership between authorities and private developers is to be successful. This will be achieved by requiring authorities to give publicity to the policies underlying their five-year programmes so that everyone is clear about the operation of the scheme in each area. Throughout this period the land scheme will be gathering momentum, but the important economic safeguard is that it will never be allowed to outrun the resources available.
At this point I feel I should explain today's procedure which has been made necessary by pressures on the legislative programme in another place and by the exhaustive consideration which has been given to the Community Land Bill there. The Standing Committee sat for 150

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hours, with no guillotine. This is a No. 2 Bill which I am inviting your Lordships to consider in advance of the final stages of the original Bill in another place. The text of this Bill is the same as the original Bill as amended in Committee in another place. In order to give your Lordships some idea of how the Bill may be changed on Report, I have also circulated copies of the Amendments which the Government had tabled for the Report stage in another place.
Your Lordships will note that there are some points on which Amendments are still being considered. Clearly the most important is the position of Churches and charities and my right honourable friend the Minister explained the Government's intentions on 15th July. But the matter is complex, and consultations with interested bodies have to be held on some points of detail. Amendments giving effect to the changes announced will be available by the time we reach Committee. It is anticipated that the original Bill will not reach us until the middle of October and I hope that by debating the principle today we should be able to give the Bill as passed in another place a formal Second Reading when it reaches us—it will certainly save your Lordships listening to me making another rather long speech!—and then proceed with a minimum of delay into Committee. I regret having to ask your Lordships to debate a No. 2 Bill, although I do not really believe that it will prejudice our deliberations since it gives the House a full opportunity to discuss the principles underlying the Bill.
It is following wide-ranging consultations with a vast number of interested bodies that the Government have decided to propose Amendments in order to clarify some points. First, we want to spell out more clearly the link with planning. As I said, this link is an intrinsic part of the original scheme, but a number of bodies have argued that it should be written more precisely into the Bill and we have agreed to this. It must now be crystal clear that the scheme will be planning-orientated.
The Amendments we propose will also ensure that the protection which our planning system at present gives to agriculture will remain, and we have accepted the case for writing in specific reference to the needs of agriculture and forestry.
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There have been conflicting arguments here. Some have said the scheme will eat up agricultural land, others that it will dry up the supply of land for development. Clearly they cannot both be right. The conclusion I draw is that we have got the balance correct.
Secondly, the question of individual rights has worried a number of individuals and organisations. Once the principle of the Bill is accepted there need to be some changes in compulsory purchase procedure. My right honourable friend explained at Second Reading in another place how these changes would operate, but again those we consulted felt strongly—and understandably—that the Government's intentions should be further clarified in the Bill. The Bill will give neither local authorities nor the Secretary of State freedom to behave in an arbitrary way. No local authority will be able to acquire land compulsorily without justifying it. The Secretary of State will, generally, have to hold a public inquiry into objections unless there has already been one at the planning stage. And where, under a special procedure which can be brought in only after Parliament have agreed to an Affirmative Resolution order, this general rule is modified, a residential occupier will have an absolute right to have his objection considered at an inquiry or hearing.
Of course, it is natural that changes in compulsory purchase must raise sensitive issues, but I believe our proposals now strike the right balance between public and private interests and should restrain the flood of false fears. Certainly the Council on Tribunals—who are the keeper of the nation's conscience in these matters—have expressed themselves content with the situation, subject to reservations on some points of detail and implementation.
My Lords, I have explained the principles and the key mechanics of the land scheme. The adverse reactions do not surprise me, and no doubt there will be a plurality of them repeated this afternoon. Innovation is always uncomfortable to a Conservative temperament and the more radical the reform the more reactionary the reaction. But a more liberal view is surfacing and with the Amendments now proposed, the Royal Town Planning Institute and the Town and Country Planning Association have

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welcomed the Bill. "A rather better Land Bill" may be rather downbeat praise from the Economist last week, but it at least recognises how far the Government have gone to meet points put to them. There are other sprigs of support springing up from the initially hostile and they will grow as the aims evolve into practice. Certainly the crazy boom and collapse syndrome in land and property are hardly gilt-edged testimonials to the advantages of the free market. They do not benefit the ordinary individual. In boom he cannot afford to buy; in collapse he may be unemployed.
Land has a special mythology. It has a primeval quality, and many people will go to great lengths to keep their territorial grasp. But things are on the move. Today many private developers negotiate planning gain with local authorities which is certainly one foot in this door. An Opposition Amendment in another place would, if passed, have put back the 100 per cent. development charge of the 1947 Act—and how fiercely that was fought at the time. Taxation, yes—now acceptable; community ownership—no, not yet.
It is the public with whom we are concerned. This is not a private matter of concern for landowners, builders, lawyers, professional bodies and any other vested interests around whom most of the argument has revolved at the present time. It is the concern of everyone, whose direct interest may not be easily defined but whose involvement as a member of the community is great; for the pattern of our towns with their housing, industry, schools, shopping centres, open spaces and transport are his living environment. Unless planning and ownership are treated together, as indisputable twins, that environment and his quality of life will suffer for him and his children. I hope that noble Lords will give something so eminently right a fair chance. Iron out the wrinkles by all means, but do not knock the basic structure.
By the time we have gone through the phasing we shall be in an entirely new situation to which the old shibboleths will no longer apply. And it will be as acceptable and respectable as all the social changes, described as revolutionary when initiated, are now. "Now is not the time" is the stranglehold of dubious reasoning used to stop every reform through our
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social history—from preventing children sweeping chimneys, abolishing the slave trade, right down to the inception of the National Health Service. If we always accepted that "Never is the time", nothing would be done and we should have nothing of the bedrock of social reform which is now part of our establishment. My Lords, I believe that this Bill has the highest social and human priority and I recommend it to your Lordships' House.
Moved, That the Bill be now read 2a.—(Baroness Birk.)
3.33 p.m.
Baroness YOUNG: My Lords, I must start by thanking the noble Baroness, Lady Birk, for introducing and explaining this No. 2 Bill to us today—though I am sure that she will appreciate that I do so only out of politeness to her and in recognition of the hard work that she has done. The Bill should be called the Land, Buildings and Housing Nationalisation Bill. Indeed, the Secretary of State, Mr. Crosland, has said of it:
"I have no doubt whatsoever that this will be the single most important and the single most Socialist measure to be implemented by this Labour Government"
We on this side are entirely opposed to it, and though we shall give it a Second Reading today we have undertaken to repeal it when we are returned to power. Not only do we condemn it but so almost without exception do those who are professionals in the field of land management; the chartered surveyors, the valuers, those responsible for pension funds—and remember that this includes trade union pension funds—the National Farmers' Union, the Confederation of British Industry, the house-building industry, the Law Society and Justice; and amenity societies whose contribution by constructive participation in planning inquiries has played such a large part in the improvement of the environment for us all.
Local government, which might be expected to welcome the Bill, is by no means unanimous in its view. Not unexpectedly, the Association of District Councils is concerned at the extensive powers of the Secretary of State over local authorities; for the Bill, in my view, takes a step backwards from the freedom and responsibility granted by the Local Government Act 1972. The Association

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of County Councils says at the beginning of its memorandum:
"The Association do not believe that the complicated machinery of the Bill is needed to achieve the Government's objective as set out in the White Paper…"
They go on to make two suggestions to deal with this situation; first, to amend Section 52 of the Town and Country Planning Act 1971, and secondly, to deal with it by taxation.
I must congratulate the noble Baroness on finding a few friends for this Bill since it completed the Committee stage in the Commons, but I think—unfortunately I tild not bring my copy of the Economist with me—that if she had completed her quotation she would see that the Economist says that it does not deal with any of the major objections of principle to the Bill but it does make some of the details a bit better—and I refer to the Government Amendments. I would not quarrel with the observations of the Association of County Councils. My noble friend Lord Barber introduced a tax in December 1973 on the development value of land which would have ensured that the very large profits at that time on development land would be returned to the community, To say that we on this side of the House are unaware of the problem or had done nothing about it is untrue.
Not only do we object to the principle of the Bill but also to the utterly contemtuous attitude taken by the Government in regard to this House. I believe it to be unprecedented for a Government to introduce a No. 2 Bill before the original Bill has completed its passage in another place. I believe that there are over 200 Government Amendments, which most of us have seen only this morning, including those very important ones on Churches and charities and the virtual redrafting of Clause 17. We have had little or no opportunity to consider these Amendments and to understand what the Bill should mean. So we are being asked to debate a phantom or psuedo Bill—and a very complicated one which directly affects the lives of millions.
Baroness BIRK: My Lords, regarding the Amendments concerning Churches and
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charities, they have not yet been drafted. I thought I had made it clear that the Minister made a Statement on 15th July indicating that, after further consultations, they will be drafted. There is no question of our considering something which is already under way in another place but of which your Lordships have not got the draft. They have not yet been drafted.
Baroness YOUNG: My Lords, I have no doubt that what the noble Baroness says is absolutely true, but my point is that we have not seen them, so we do not know what they are going to say; we do not know what guarantees are being written into the Bill. What we are debating today is a psuedo Bill. The only conclusion to be drawn from this incredible procedure must be that the Government do not want to hear from the many experts in this House; that they are not prepared to listen to an effective Opposition. If this is typical of the behaviour of this Government, it is not surprising that democracy is viewed so cynically by so many people outside. We on this side of the House will certainly expect adequate time for what I shall call the correct Second Reading in October. One explanation that I can give for this procedure is that the Government would prefer us not to understand the Bill at all. In my view they have already deceived the public by the title. The further one looks into the Bill the more frightening it becomes, and one can well understand why so many people have put the worst possible construction upon it.
Let me turn first to constitutional points. As the noble Baroness has clearly explained, the Bill is divided more or less into two parts; those transitional powers which will come into effect on the First Appointed Day, which I assume is when the Bill becomes law, and those which will come into effect on the Second Appointed Day. There are two major objections of principle. The first is that the Bill confers wide and arbitrary powers on the Secretary of State and on local authorities, and, secondly, that so much is left to be defined by regulation. For example, in the transitional period under Clauses 17 and 18 local authorities will have the power to acquire land which "in their opinion is suitable for relevant development".

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When we ask, "What is development land?", it is described in Clause 6:
""development land", means land which, in the opinion of the authority concerned, is land suitable for relevant development",
and when we ask, "What is relevant development?", we are referred to Clause 3(1) which reads:
"…"revelant development" means all development except development of such a class or classes as may be prescribed by the Secretary of State by regulations, and except as provided in the following section"
What are the exceptions? The exceptions are single plots of less than quarter of an acre owned and occupied on that magic day, 12th September, 1974. Why that day? It is the day of the publication of the White Paper. Why it should be chosen we do not know. Then I understand there is a promise of 10 years for Churches and charities to develop their own land (although as I understand it they will not be allowed to develop their investment land) and they will be exempt from development land tax. One of the Department of the Environment consultation documents lists a number of exceptions to be laid down in regulations, but why are they not written into the Bill? Nothing is said about listed buildings, conservation areas, green belts, areas of outstanding natural beauty, National Parks, for only the two joint boards are authorities under this Bill.
I understand that Government Amendments indicate that they intend that local authorities, in acquiring land, will take into account the proper planning of the area, and that what is development land will have to be consistent with local development plans and structure plans. This is an improvement because at least it means that it is not the intention of the Government to wind up the whole of the planning system, but it by no means gets over the difficulties. My noble friend Lord Colville of Culross, who is an expert on this matter, will be speaking of it at the end of this debate. But anyone who knows anything about structure plans knows that they are nothing more than very general statements of intent. Even if they are approved—and a great many are not—how the individual or industry will know the exact effect of a proposal on his land is very difficult to see. Furthermore, it is often very difficult for an individual who may have recently
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moved into the area, or a business, to know that is going to happen.
On the second appointed day, local authorities will have the duty to acquire all designated development land. Again regulations will define relevant development, and compensation will be paid at current use value. Clause 29 explains that financial tribunals may be set up. Again, the Secretary of State will regulate their power and function, but why is it not a duty to have a financial hardship tribunal? It hardly seems likely that all hardship will be alleviated as under the Bill as written.
Finally, my Lords, Clause 50 gives reserve powers to the Secretary of State, so far as I can see to do almost anything—to take over local authorities and any of their functions under this Act. Besides these points, there are some other major principles which give rise to concern. Under this Bill, local authorities have the power to give themselves not only planning permission on both land which they have and have not acquired but at the same time they are developers. I do not share the confident view of the noble Baroness, Lady Birk, that there will he no corruption.
Several Noble Lords: Hear, hear!
Baroness YOUNG: I have known a lot of local government in my time. Noble Lords opposite may laugh and think it very funny, but I would remind them that nobody would have known anything about corruption in the North-East but for the fact that Mr. Poulson went bankrupt. To suggest that, because we have not heard of it, therefore it does not exist, is illusory. For corruption, the possibilities in the Bill are almost limitless. I hope at least that all of its provisions will be subject to scrutiny by the local Ombudsman, and where appropriate, the national Ombudsman, and that we shall not have the extraordinary explanations that have been given in the Court Line case.
Furthermore, it is vague, when we consider how local authorities are to dispose of land. Something in Schedule 3, and Clause 43 makes it clear that local authorities cannot dispose of any land for more than a seven-year lease, except with the consent of the Secretary of State. Clearly, industry and pension funds will want to know considerably more than this. They

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will want to know the length of lease likely to be granted. So far as I can see, nothing has been said about the length of lease likely to be granted to different categories of development, or on any principles at all that they will apply to the disposal of land. All this comes at a time of rising unemployment, and of rising concern to industry; at a time when industry above all needs to be encouraged.
I was glad to hear the noble Baroness say that housing was generally to be freehold. It would be nice to know, if I am quoting her correctly, what that statement means, because in some of the documents I have seen, it is suggested that housing should be on licence. I do not know what that term means. I should like an assurance from the Government that it will be not used at all. I should like it written into the Bill that all housing is to be freehold.
My Lords, I should now like to say something about the extraordinary and deplorable decision to set up a Land Authority for Wales. So far as I can see, no adequate reason at all has been given. I have read both the Second Reading debate and the proceedings in Committee in another place, and it is difficult not to draw the conclusion that the Minister does not want the new county authorities in Wales to have these new powers, and does not trust them. The noble Baroness talked at length about the responsibilities of the local authorities in England, but she never mentioned the local authorities in Wales. I hope the noble Lord, Lord Melchett, will explain why there is this difference of treatment. Local government in Wales was reorganised under the 1972 Act to create larger and more responsible local authorities. And yet we have a major function given to the English counties, and not to the Welsh. It certainly makes planning in Wales far more complicated. There is now a separation of the usual planning functions which belong to district and county councils, and between the planning and development functions of the Land Authority. Three parties will be involved; it is more complicated administratively, and infinitely less intelligible government to the average Welsh man or woman.
My Lords, I turn now to the cost. Since this Bill had a Second Reading in
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the other place, we have had the White Paper of the right honourable gentleman the Chancellor of the Exchequer. I find it difficult to reconcile the Bill with the White Paper. The White Paper is clear on local government expenditure. Paragraph 16 says:
"Unless staff numbers are tightly restricted the Government will have to reconsider the scale of provision of grant."
Yet this Bill envisages the employment of up to 13,000 extra local government staff, clearly not all at once, but then no one, not even the authors of the White Paper, expect inflation to be conquered in a year. Paragraph 3 of the White Paper makes this clear. It is difficult to believe that without any extra staff the Bill can operate at all, and with the extra staff how it can be consistent with Treasury policy?
The Government will say, and have said, that a great profit will be made out of land. The division has already been given to us between local government and central Government. How can we be sure? We have heard it explained to us that local authorities will have to borrow money in order to acquire the land. Such borrowing will involve high interest payments, and inevitably will add to the costs of the hard-pressed ratepayers. Indeed, when the Bill is fully operational, it is estimated that land acquisition will cost between £300 million and £400 million. It is assumed that an enormous profit will be made by local government, but much as I admire local government, I would be the first to say that it is not equipped, by outlook, training or flexibility to administer what amounts to entrepreneurial land assembly, and property construction in urban areas. Even the Greater London Council has questioned the assumption of large profits to be made out of this Bill. Can a metropolitan county afford to buy up large tracts of land in London, or in other major urban areas, even at current use value? Can a metropolitan county then dispose of it and make a profit? For the reasons I have already given, I think they will find it very difficult.
But the situation is even more doubtful because, as I said earlier, the Bill says so little about the disposal of land. I believe it to be true that the Government intend that all development, or all future development land should be vested in the local authorities. But, of course, in many

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cases the profit that a local authority might expect to make on a development could well depend on their being able to sell surplus sites at freehold value. Will this be possible? Perhaps the Minister will tell us.
My Lords, the last point I wish to make about the Bill is its very serious effect on individual people, for it represents the clearest difference of philosophy between the two Parties.
Several Noble Lords: Hear, hear!
Baroness YOUNG: We in the Conservative Party believe not only in the ownership of property, but in encouraging the widest possible ownership of property, not simply because home ownership is what most people want—a basic freedom—but because it gives people a stake in the community and because by ownership of property individuals can stand together against the power of the State. Not surprisingly, the first action of a Communist Government is to take away private property. I believe this to be possible under the Bill. I listened with great interest and, I must say, some surprise, to what the noble Baroness said about owner-occupiers. I hope she will correct me if I am wrong in my interpretation of the Bill, and if I am right I hope she will agree to the Amendments that are necessary to bring it into line with what she has said, because I should like to look in great detail at what the Bill has to say about owner-occupiers, who were promised in the White Paper that they would be safe.
There are, it is true, the exemptions in Clause 4 for owner-occupiers, but my understanding is that these apply only to occupiers of houses with less than a quarter-acre plot who were in occupation on 12th September 1974, and who then fill up the necessary form. Anybody who has bought a house since that date is not exempt and, furthermore, the exemptions cease on the transfer of the house. It is therefore possible to foresee, within a measurable distance, the time when no owner-occupied house will be exempt from the Bill. Already it is estimated that about a million people fall into this category. If my interpretation is wrong I shall be glad to hear so, but I should like to have it written into the Bill to make it quite clear that all owner
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occupiers, whether occupying their houses on the 12th September 1974 or not, will be safe.
In the meantime, anybody with more than a quarter of an acre plot can have it taken away from him at current use value, or during the transitional arrangements when development tax will be in force, with a tax of 80 per cent. rising to 100 per cent. Of course, when it reaches the 100 per cent. level any profit that may be made on the sale will go; the individual will be unable to keep up with inflation and, clearly, will have considerable difficulty in buying another house.
The council can thus take land for development, even if the individual has already been refused planning permission on it by the council. If you are unfortunate enough to live in a disposal notification area—and I think the House should look at the language of Clause 25(2) which says,
"An authority may pass a resolution declaring any land in their area to be a disposal notification area."—
you cannot sell your house without first notifying the council, and then it has four weeks in which to decide whether or not to acquire it. It takes little imagination to foresee what price you will get at the end of that procedure. We shall propose many Amendments entirely designed to help owner-occupiers now under threat.
For the prospective home buyer, the news is equally bad. It is completely untrue to suggest that houses will be cheaper. The Bill will slow down house building by making the whole process take much longer. All the advice of Mr. Dobry, in his report, has been ignored. It will make homes more expensive, and it has already been estimated that an extra £500 is added to the cost of each new house because of planning delay. The uncertainty created by the Bill has already started and less land for house building is available. This happened in 1947, it happened in 1968 and it will happen again. Furthermore, a great deal of confusion will be caused, as under Schedule 1 local authorities will have duties conferred on them in different parts of the country and on different dates.
Even private tenants and landlords are not excluded from the Bill. Tucked away in Schedule 4, paragraph 22, the

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Secretary of State has power to possess any house to which the 1968 Rent Act applies. How many landlords know this? How many tenants know that their security of tenure goes if the Secretary of State wants their house? It seems to me to be a complete reversal of the policy of this Government over the last 18 months. Finally, in Schedule 4 there is some mention of the rights of entry on to property, and for some curious reason only 24 hours' notice seems to be necessary for entry on to private property, but for entry into an office block seven Jays are allowed. I wonder why there is this difference and whether there is any point in it.
My point in raising all these major matters is that in every Part of this Bill it is the individual who suffers, either in fact or from uncertainty. We have already heard the answer from the Government to all these points. The answer to the detailed matters that I have raised will, of course, be that neither the Secretary of State, now or at any future date, nor local authorities would act in an arbitrary way. We shall be assured that they will never be dictatorial, that they will never be corrupt. That simply is not good enough. Alas! sin is ever with us, even despite this Bill and we have before us the spectacle of the Clay Cross councillors, whose actions are supported by the Parliamentary Labour Party. Think, my Lords, what those councillors would do with this Bill in their hands.
In a speech to the Virginia Convention in 1788, James Maddison said:
"I believe that there are more instances of the abridgement of freedom of the people by gradual and silent encroachment of those in power, than by violent and sudden usurpations."
It could well be the moral of this Bill. I believe that this is what is now happening in this country under this Government and it is for that reason, above all else, that we cannot support this Bill.
3.56 p.m.
Lord FOOT: My Lords, I should like to begin by associating myself with what the noble Baroness, Lady Young, said at the beginning of her remarks when she thanked the noble Baroness, Lady Birk, for her exposition of this Bill, but I am afraid that that is about the only remark in her speech with which I am at all able to associate myself. I should like
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to qualify that association and say that I express my thanks and congratulations to the noble Baroness, Lady Birk, not out of politeness, but because I think she has greatly helped the House by her lucid and brief explanation of this appalling Bill. I do not mean appalling in any other sense than that it is a difficult one to define and explain. I should like to tender to her—I think on behalf of the whole House—our gratitude for the explanation that she has given us.
I shall not try to discuss this Bill in any detail, not only for the general reason that it is inappropriate to discuss the detail of a Bill on Second Reading, but also for the more particular reason to which the noble Baroness, Lady Young, has drawn attention. This is what she calls a "pseudo" Bill, and what I was going to call a "mock-up" Bill, as the real Bill is still a footus in the womb of the House of Commons, and we shall not know the shape and lineaments of this infant until it is eventually delivered there and produced to us for our adoption, which I gather will not be until after the Recess. So we are in the slightly ridiculous position of discussing an embryo Bill.
The situation is made a little funnier by the fact that, in being invited to give a Second Reading to this Bill, we have been provided, by kind courtesy of the Leader of the House and the Whips' Office, with a memorandum explaining the ways in which this Bill does not represent the present thinking of the Government. That is an odd situation but, surely, it is going a little far. Then there is the indignation which the noble Baroness, Lady Young, expresses when she says that this is treating the House with contempt. Surely this is a little artificial, is it not? It is a little funny, but I suspect the House will think that this is all part of the Party exchange to which we are all too used. It is a little absurd but, nevertheless, I think the House will agree that it is not disadvantageous that we should be allowed to debate the general principles of this most important measure before we go into Recess, and it is quite possible to do that under the arrangement which the Government have made of introducing this No. 2 Bill.
There is something else which I might say, I hope by way of commending myself

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to the House, and particularly to the Government. In the prevailing circumstances, I shall not say anything which will raise the temperature of this Chamber, either metaphorically or otherwise. Towards the end of her remarks, the noble Baroness, Lady Birk, said something about a more liberal view now surfacing. I do not know whether I am the incarnation of that surfacing, but that is what I am doing now, and my few remarks this afternoon will not be in any hostile spirit to the Government.
What I should like to do within my limited capacity, because I think it might be a little helpful, is to review briefly the history of what, since it first became a major political and social issue in the Budget of 1909, has come to be known in this country as the land question. I should like to try to do that without slipping into the quagmire, jargon, and verbiage with which the whole land question and all town and country planning legislation is submerged. I am afraid that this Bill like so many before it, suffers from this disadvantage. One of the unhappy features of this Bill is that it is full of jargon. Indeed, it is a melancholy observation that, if you look at this Bill you find that the first nine out of a total of 58 clauses, which is a percentage, according to my calculations, of about 18 per cent. of the Bill, are devoted entirely to explaining the meaning of the words which are being used in the second Part of the Bill, or the timetable by which the operation is to be introduced.
This is a serious matter because we constantly talk about the importance of public participation and so on in these matters. I believe that because of the jargon which has grown up, particularly in this field, there is a deep misunderstanding among ordinary people of what we are about when we talk about relevant development and things of that kind. As I say, this is a serious matter. It was not always so. I stand to be corrected from the Bench of Bishops, but if I recall rightly the Ten Commandments did not have any interpretation clause, they did not even have an Explanatory Memorandum, or a background Paper. The Government or the Parliamentary draftsmen may think that to be one of the reasons why the Ten Commandments have not been so widely observed. We have got
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into the situation today where the whole question of land is surrounded by this mist of verbal confusion.
May I draw your Lordships' attention to a strange contrast which emerges from the story of land legislation in this country, particularly since the war. I would suggest that there are three elementary propositions upon which there is widespread agreement. They are propositions to which, in opening this debate, the noble Baroness alluded in slightly different terms. I should like to express them in the simplest possible language, and I suggest that they are propositions on which, whatever may have been the situation in the past, there is now a general measure of agreement and approval.
The first of them is that because land is such a special and unique kind of problem, and because everything which is done on or with land affects not only the landowner and his immediate labours, but the community as a whole, it is essential in any civilised State that control over the planning of the use of land should be in the hands of the community. That proposition of the physical control of planning—and I shall come to the positive kind of planning in a minute—which was set up in the great Silkin Act of 1947, that system of planning development, of structure plans, granting or refusing planning permissions, has now become part of our accepted way of life. Furthermore, which is very important, we have now generally agreed among the community that if the community says "No" to any projected development, then it is under no obligation to pay compensation to the landowner to whom permission is refused. That is the first elementary proposition which I would say has now received general acceptance.
Secondly, again because of the nature of the land, and because particularly it is a limited commodity, it is absolutely intolerable in any civilised community, where you get increases in the value of land which are not attributable to the activity of the landowner but entirely attributable to the activities of society, that the benefit, or at any rate the greater part of the benefit derived from that increase in the value of land, should go into the pocket of the private individual rather than into the public purse. This is something which is now accepted, except possibly among the Neanderthals.

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It is a proposition which I am sure is generally accepted throughout the country as a whole.
The third elementary proposition, which is perhaps not so platitudinous as the two I have mentioned before—and the noble Baroness was reading the appropriate paragraph from the White Paper; I think it was paragraph 21—is that the Government are perfectly right in saying that planning control is not satisfied if you are simply able to control the physical thing which is done to the land. You have to bear in mind the social and economic needs of the community, and that requires the sort of positive planning about which the Government talk. In that sphere, as well as in the sphere of physical planning, it is, in the last resort, the community which has to be in control.
The contrast which I wish to invite the House to consider is, that while I believe there is today—whether it was so in the past or not, I do not know—a general consensus on those three elementary propositions, the fact is that if you look at the history of land legislation since 1945 it has been, with one exception, a legislative shambles. The one exception is the great planning set-up, planning control, established by the Silkin Act in 1947. That has survived and stood the test of time, and only very recently that has received the testified approval of the Dobry Report. But with that exception, and in the other two fields of which I have been speaking that is the field of betterment, and trying to ensure that increased values go to the community—in the field of betterment and in the field of meeting the social and economic needs of the community through planning arrangements we have got nowhere at all.
The fact of the matter is that today the scandals are so obvious, and we have known about them for so long. First, there is the scandal by which development is determined very largely simply by private profit, and whether there is a private profit to be made out of it. The second scandal is whereby, by the grant of planning permission, a person can receive vast wealth—Dr. Johnson called it wealth beyond the dreams of avarice—for making no contribution whatever; wealth that is purely arbitrary. This scandal is unabated and rampant
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today, with all the corruption and the possibilities of corruption which go with it. In these two spheres, therefore, we have not got anywhere.
The Government will say, I think with some justification, "That is not our fault. We have made two attempts since the war to try to deal with the land problem and on each occasion the thwarted Tory Party, on returning to power, tore up our legislation, thwarted us and therefore it is not our fault." But I am not at present concerned—I hope I do not sound pompous in saying this—with whose fault it is. I am concerned with the good government of this country. The shocking fact today is that not only have we got behind us this lamentable story of enactment and repeal, measure and counter-measure, all cancelling each other out, not only do we have behind us these 30 wasted years on this problem, but we have been told by the Tory Party, and the noble Baroness, Lady Young, repeated it today, that the first thing the Tory Party will do if they are returned to Office (which God forbid!) is to repeal this measure.
Several Noble Lords: Hear, hear!
Lord FOOT: So we have not come to the end of this miserable saga, my Lords. We are offered the possibility of having to go through this same old thing all over again. It is all very well for Conservative noble Lords to say, "Hear, hear!" but I ask why we have got ourselves into this situation. I think that a fourth elementary proposition with which most people in this country would agree is that in the sphere of legislalion, particularly legislation about land, the one thing we want above all is a sense of continuity. That applies of course in other fields, but it applies particularly in the whole sphere of land.
But consider the practice of successive Governments. Nowadays it seems to be the accepted practice that as soon as a new Administration come to power the first thing they do is to set about a demolition job that is, dismantling the legislation which has been passed by their predecessors—clearing the site, as it were, in order to erect their own ideological edifices which will be dismantled in due time when the next Administration come to power. What is the point of all this? Why do we have to add to all our sufferings and

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troubles, of which we are all too keenly aware, these added self-inflicted wounds? The short answer, as the Government know—it may not be distasteful to them at all; certainly it will be distasteful to the Tory Party—is that we labour under an electoral system which forbids the possibility—
Several Noble Lords: Ah!
Lord FOOT: I do not know why noble Lords on the Opposition Front Bench should receive this comment with such growls.
Viscount COLVILLE of CULROSS: Not growls, my Lords—groans.
Lord FOOT: I hope they read the other day the article by their erstwhile Leader, Mr. Robert Carr, in The Times about this matter, because he made the very point I am just about to make; namely, the reason for it is that we have an electoral system, for better or for worse, which has the effect that not only does one never get a House of Commons which represents the true alignment of political opinion in the country but one cannot get it because the system forbids it; one cannot get an accurate reflection of the true opinion of the country if the reflection is in a distorting mirror. This is the fact of the matter and the result of it is that ever since the war all legislation which has ever been passed, except by consent—that is, except with the approval of the Opposition—has been passed by Governments who have not got majority support in the country. We have been ruled since 1945 by minority Governments in the sense that they have not had majority support, not only among the electors as a whole but even among the people who bother to go to the polls.
We have heard from the noble Baroness, Lady Young, today, speaking for the Opposition much the same language as has been used in the other place over this Bill. We have heard this Bill denounced in extravagant and sometimes ferocious terms and it is certainly not my intention to engage in that sort of language or give any support to it. We have been told that this is a giant step towards the full Socialist State, that it is an assault on the rights of the individual
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and the rest. There may be some small merit in these criticisms and particularly on the latter matter of the rights of the individual, but those are matters to which we can come in Committee certainly do not adopt that approach at all. I believe that this Bill is what it purports to be—I take the Government as acting in good faith in this matter—that is a genuine attempt by the Government to find a lasting solution to this problem. I use the phrase "lasting solution" in preference to the one used by Mr. Silkin in another place on Second Reading when he talked about a "final solution". I believe this is a genuine attempt to find a lasting solution within the parameters, if that is not now a dirty word, of the general propositions which I was trying earlier to explain. I regard it as a genuine attempt by the Government to find a lasting solution to the problems as they see them.
I would go so far as to say—and I do not know how far I would carry my colleagues with me—that I certainly do not reject and I never have rejected the idea that it may be necessary, in order to achieve what is now called positive planning, for the State to acquire the ownership of all development land. I do not exclude that at all. However, my doubts and hesitations about the Bill are confined to narrower limits. I have doubts about the timing of the Bill, to which I will come shortly, I have grave doubts about the machinery of the Bill, and in particular about the decision of the Government to make the local authorities the agents for the implemention of this great reforming measure. I will not develop these arguments because we are to have a long debate, in the course of which many noble Lords will no doubt speak about this decision to make the local authorities the agents.
I shall conclude with a few general observations. I do not think the Government are in any position to be smug about their decision to make the local authorities the agents because, after all, this constitutes a reversal of what has been their thinking in this sphere for the last 30 years. Both the Land Board of 1947 and the Land Commission of 1967 were setting up national organisations not based on local authorities, and for those 30 years, therefore, the thinking of the Labour Party has been against local

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authority implementation and in favour of some kind of national body. It follows from that, I suggest, that the burden of proving, if they can, that they are right now in reversing their previous stance and giving the agencies to the local authorities—putting on local authorities all these burdens, so creating this new bureaucracy—rests heavily on them. I hope it is not too late for them to consider that the real solution may be not to nationalise at the local government level or at the national level. As was referred to in the Kilbrandon Report—and in the Minority Report, of which the chief author was of course the noble Lord, Lord Crowther-Hunt—the Government should consider even at this stage whether the correct level at which one should have the positive social planning is at the regional level, as they are proposing for Wales. If it makes sense in Wales, why should it not make sense in the regions of England, and, indeed, of Scotland?
My second criticism of the Bill is this. There are many people of authority who are generally sympathetic to the Government in this matter but who have expressed grave doubts as to whether one can introduce this system and put these burdens on local authorities—with all the involvement in public borrowing and so on—at this economic moment. As a friend, I urge the Government to consider the seriousness of this point because, if the Bill becomes law, I for one want it to work, if the economic circumstances are so stringent that it is impossible to make it work, it will be a disaster for the community, for the Government, for everybody. I want the Bill to work if it is to go on the Statute Book at all. I very much doubt and many others are even more doubtful than I, whether in our present economic circumstances we can afford either to set up this great bureaucratic structure or to embark upon the great borrowing commitments which will be required. Thirdly—and I am sorry to go on for so long—
A Noble Lord: Hear, hear!
Lord FOOT: My Lords, I do not know whether or not that was meant to be encouraging, but I shall take it as encouragement. Thirdly, there is the question of betterment—that is, ensuring that land value increases go into the public purse. As has been suggested by the
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noble Baroness, that is something which could be dealt with by methods other than the methods proposed in the Bill.
The final comment I wish to make is one of commendation. I do not believe, like the Tory Party, that this sill is a giant step towards a Marxist State. I believe that it has one virtue if one accepts it at its face value, as I do. It recognises that we are living in a mixed economy and that, if the reform is to work, the private sector must be allowed to play a proper part side by side with the public sector. I have taken the view for quite a long time now that the division in politics in this country today is entirely artificial. I believe that the great divide in politics—in the field of economic management, at any rate—is that between those who want to see a steady progression to a full Socialist State and those who believe in the mixed economy and who want to make it successful and viable. I believe that the vast majority of people in the country as a whole would come down in favour of the second choice.
My conclusion is therefore this. I hoped that it would have been possible for the Government, in preparing this legislation, to produce a Bill which would have provided answers to the objectives which they have in mind but without encumbering them with the bureaucratic machinery and the financial commitments which are involved in handing this matter to the local authorities. I do not believe that we can afford it and, as I said before, I believe that the scheme is dangerously threatened with unworkability. I believe further and, finally, that if the Government had succeeded in producing such a Bill—which would not have been a Bill which commanded universal support because that is not possible with the noble Lords on my left, but which would have commanded substantial majority support in the country—they would have carried through a measure which no succeeding Government, how-over Right Wing, would have dared to repeal. My apprehension and my fear is that that opportunity may have been missed.
4.25 p.m.
The Lord Bishop of LONDON: My Lords, I wish to associate myself with those who have congratulated the noble Baroness, Lady Birk, on the clarity and

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brevity with which she introduced this very complicated Bill. She has done us all a great service in so doing and we express our gratitude to her. This Bill is without doubt one of the most important and far-reaching measures to have been brought before your Lordships' House in recent years. As your Lordships know, under its provisions all land needed for development will come into public ownership. Presumably, that will be a continuing process with more and more land in Public ownership and less and less in private ownership. This certainly represents a major revolution in the thinking about the whole philosophy of the tenure of land. The philosophy which underlies this policy is stated clearly and succinctly in the first paragraph of the White Paper, which says that planning should seek,
"…to secure a proper balance between the competing demands for land, so that all the land of the country is used in the best interests of the whole people."
Few people would wish to quarrel with that definition. Equally, I believe that few would support a system which has made land so profitable a field for the speculator, and which has provided vast profits for those who have little interest in the welfare of the society which that system ought to have been serving.
As I see it, therefore, the question is not so much about the principle underlying the Bill, as about the means by which it is to be implemented. Will the Bill be practicable? Will it achieve what it sets out to do? Will it do it without imposing injustice on individuals or sections of society? That is the matter which is before your Lordships for judgment.
I mentioned the importance of examining the Bill from this point of view because the experience of the Churches is an illustration of the way in which—I am sure quite unwittingly—the Bill could have inflicted great damage on a section of society and could diminish or bring to an end work in society which is generally recognised to be beneficial. Here, I speak not so much as a Bishop of the Church of England as from the experience I have gained as Chairman of the Churches' Main Committee. This is a body representative of the main Christian communions of the United Kingdom and of the Jewish community. Its purpose is
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to negotiate with Government in matters where their interests are concerned. Collectively, the Churches own a considerable amount of land and buildings erected on that land. Many endowments from the past have been in the form of land. For many of the Churches—and this is especially true of some of the smaller Churches—the only capital asset they possess is in the form of land and buildings.
It is therefore essential that if they are to fulfil their responsibility towards society—and that is the object for which they exist—they should have freedom from time to time to realise their assets, not at speculative prices but at reasonable prices so that they may, when necessary, redevelop and extend their work. The Churches are particularly vulnerable to the effects of changes in social behaviour and in the movements of population. Our forefathers often built spaciously and lavishly to provide for the needs of their day. Frequently the population has moved away, and therefore we have areas which are seriously over-churched. They provided buildings which are now almost impossibly expensive to maintain. Vast sums have to be raised to keep the fabric in proper condition, and much Church property, especially in urban areas with huge churches, large parsonages and big gardens, has been seriously underdeveloped according to modern standards.
Therefore, there has been a steady process over the years whereby the Churches have been redistributing and redeveloping their assets. Sometimes this has been in the form of selling a redundant church building and erecting possibly a number of churches or community centres in new housing areas and New Towns. Sometimes it has involved redevelopment of the site when a spacious Victorian church, vicarage and garden have, in co-operation with the developer, been replaced by flats which would be an asset to the community—such as for old people—and a scheme has incorporated a centre for worship, for community activities, and for the accommodation of the clergy. Again, many Churches have sold down-town properties in order to provide youth clubs, old people's clubs, schools and other social amenities in places where there was greater need.
All this considerable activity has been possible only because the Churches have

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been able to liquidate their resources in one area in order to work creatively in another. In paragraph 32, the White Paper laid it down that:
"The Government propose that the ultimate basis on which the community will buy all the land will be current use value—that is to say, the market value of land for its current use without including any additional value representing the hope that it might be developed for any other purpose…"
Those three words, "current use value", constitute a threat of quite devastating danger to the ongoing work of the Churches, for the current use value of a redundant church is virtually nil; and the current use value of a large ungainly vicarage in a down-town area is next to nothing; and the current use value of a redundant school is very small.
Therefore, were this principle to be applied, it would mean that at one stroke the greater part of the assets of the churches would have been rendered valueless, and the forward planning of the Churches would come to an abrupt end. There are two further areas where the consequences would be most serious, especially in the relationship of the Church and the State. The first is in education. The dual system, which coordinates Church schools and county schools in a single system, depends on a financial contribution from both sides. Throughout the country there are long-term plans for school rebuilding to which both sides have committed themselves in good faith. The Church relies largely for its share of the cost of new schools on the sale price of redundant schools which, under Section 86 of the 1944 Act, and now under Section 2 of the 1973 Act, become available for school building elsewhere where schools are needed. But the current use value of a redundant school is very small indeed, and if the Churches were to be restricted to such remuneration they would be unable to meet their contribution to the new building. As has been said authoritatively, it would bring the dual system to an end.
The other specialised area that would be seriously affected is one which particularly concerns the Church of England. A section of the Pastoral Measure 1968 deals with the problem of what is to be done with redundant churches, and especially with those churches which, although they are no longer needed, for one good reason or another, for worship
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—and no proper alternative use can be found for them—yet for historical or aesthetic reasons ought not to be 'destroyed. Such buildings eventually come under the care of a national body named the Redundant Churches Fund. The cost of maintaining these redundant churches is considerable and the resources of the fund are two-fold. It receives a Government grant and, in addition, when any unwanted redundant church is sold, two-thirds of the sale price goes to the diocese concerned for further development, and one-third goes to the Redundant Churches Fund as the church's contribution.
But if a redundant church can be sold only for its current use value, which is nil, then the Church would be precluded from fulfilling its part of the bargain in the agreement with the State in providing for these redundant churches. Therefore your Lordships will appreciate that on reading the White Paper on land the alarm of the Churches was not unjustified. So serious did the threat appear to be that they took the unprecedented step of asking the Prime Minister to receive a deputation from all the Churches which could express their anxiety. On 23rd April the Prime Minister, accompanied by the Minister for Planning and Local Government, Mr. Silkin and the Paymaster General, Mr. Dell, received the Archbishop of Canterbury who was accompanied by the Cardinal Archbishop of Westminster, the Chief Rabbi, and representatives of the Federal Free Church Council, the Moderator of the Church of Scotland and the Archbishop of Wales, and other leading churchmen. The deputation was with the Prime Minister for over an hour and was most sympathetically received. I am sure that it the most reverend Primate the Archbishop of Canterbury, or indeed any other member of the deputation, were able to be present today, they would wish me to express their gratitude to the Prime Minister and his colleagues for the patience and the courtesy with which they were received.
The Prime Minister undertook to examine the case we had put before them, and since then an Amendment, moved by Mr. Kevin McNamara in another place, has been followed by a Statement by the Minister on 15th July. It is not necessary at this juncture for me

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to go into the details of the Statement, which are highly technical as well as being very helpful, and they will come before this House later in the form of Amendments, as we have been told. All I need to say now is that the Churches Main Committee fully recognise that the Minister has made considerable concessions in his desire to meet the concern of the Churches and their difficulties, and we want to express to him our gratitude for having gone so far to allay our anxieties.
As always in situations like this, there are a number of points on which we shall have to ask for discussion and clarification. What exactly is meant by, "development for a charity's own use"? What constitutes the curtilage of a building—which is an important point in estimating its value? What happens in the case of transfers of land between charities or with, say, local authorities? What happens about gifts to charities of land still in the hands of the donor on White Paper Day? Again, we see certain practical difficulties arising from the 10 year rule, which may prove to be too short—especially in the present economic climate—for charities to rearrange their affairs. This is especially true in the case of school programmes.
Moreover, it is important to appreciate that the Churches and charities are active organisations in a rapidly changing world, and they need to be free to realise and to re-deploy their resources to meet changing circumstances. As land held on White Paper day is replaced by land acquired after that day, charities will lose their exemption from development land tax if they sell it and will not be able to develop it for their own use without the intervention of the local authority. There will therefore be a tendency for the work of Churches and charities to become frozen into the pre-existing pattern based on the land held on White Paper day; and that, we believe, would be regrettable. These, however, are matters which will have to be discussed during the course of negotiation and they do not in any way minimise the gratitude that the Churches feel to the Minister for his appreciation of their problems, and for his readiness to meet them.
I am glad that the concessions he has made apply to all charities; for the
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Churches would not wish to ask for privileges for themselves which were not extended to others who are doing work in comparable fields. The Churches' pocket is not a private pocket; for every penny which goes into it is used for the benefit of the community, whether in the sustaining of public worship or the upholding of the moral values for which they stand, the payment of the clergy, the upkeep of great buildings, which are national as well as ecclesiastical assets, or serving the community through their schools, their clubs, their community centres and their care for old people. These are all services which society needs and which would probably be done less well, and certainly more expensively, if they had to be done by the State. It is difficult enough to fulfil these obligations in these days and what we ask, therefore, is that it should not be made more difficult for the Churches and the charities to discharge their responsibilities.
4.32 p.m.
Baroness STEDMAN: My Lords, may I have the pleasure of being associated with other noble Lords who have spoken in offering my congratulations and thanks to my noble friend Lady Birk for the extremely clear way in which she explained the Bill to us this afternoon? She certainly made our job of understanding it much easier. Because there are a lot of other speakers to follow. I should like to concern myself mainly with the attitude of the local authorities so far as this Bill is concerned.
Land is one of our most scarce commodities and, therefore, the true needs and priorities of society can be met only by some form of public ownership of development land; so that we can ensure that land is always available for the needs of the community, whether it be for housing, social services, welfare provision or recreation. The way in which the granting of planning applications and development enhance the value of land way above the current use price is inevitably pricing out of the market local authority schemes for the provision of old people's homes, hospitals and so on near to the centres of population. So far as old people are concerned this leads to old people's homes having to be built and residential accommodation provided some way from the town or local centre, thus depriving the more able-bodied

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residents of those homes from joining in a full and active life in the community.
This sort of thing cannot be tolerated for much longer. Land should, and must, be made available for the development where the development is needed, and not where local authorities can afford to put the development. This Bill ensures that the community will be able to acquire land just where it wants, for its own use, and at a price it can afford to pay; and where land is needed for the private developer the community will be able to recoup any increase in the value of the land over and above current use value.
My Lords, two or three years ago in my own county, we had a smaller expanding town, and because of the money that the local authorities put into the infrastructure for that expansion we, as a county authority, had to provide a new comprehensive school. We needed 30 acres of land and, because of the development that had gone on around it, we had to pay £35,000 an acre. That meant that my authority were paying over £1 million for the site for one comprehensive school, before we put any buildings on it or equipped it. Local government has long complained of successive Governments taking away its powers; and the cry has gone up at successive local elections to keep local government local. This is one function that this Government today are proposing to place on to local authorities. I believe that the local authorities, when they have understood the Bill and when they have heard explanations such as we have heard today from my noble friend Lady Birk, will welcome the opportunity of administering the Bill.
The land will have to be acquired, it will have to be managed and arrangements will have to be made for it to be leased. This is going to require extra staff, skilled in land management, in local authority services. I am a member of the ACC Executive Council; and it will not surprise your Lordships to learn that I do not always share their views on some Bills which my Government are putting forward. But I accept that where local authorities are concerned with the administration of the Bill, at this time they may have reservations about the introduction of the measure in our present economic climate.
The noble Baroness, Lady Young, referred to staffing problems. We have
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been told by the Chancellor and by other Members of the Government that local authorities are not to increase their staff because of our economic position. I think most local authorities have accepted this dictum; yet in my own county alone, we understand that we require an increase of 70 in our staff, many of whom will have to be experienced in land assembly, land management and valuation. I should like to know what steps the Government are taking to ensure that staff of the right calibre are available to local authorities at the right time. Is it anticipated that there are going to be any problems for counties which have new towns within their area where the new towns already have these powers for the acquisition of land for their requirements? When local authorities have had their borrowing powers considerably curtailed in most other fields, how are the Government to justify making available the very large sums of money that will be needed, very quickly, in order to finance the acquition of land and the implementation of this Bill while, on the other hand, they are withholding the rights and permission for local authorities to provide for the education and social service needs of the area?
I regret the comments made by the noble Baroness, Lady Young, on corruption in local government. I have been in local government for many years. We are not perfect, as national Government is not perfect and as industry, private or nationalised, is not perfect; but I believe that we in Britain have the finest local government of any country in the world. For many years we have been extremely well served by people doing this work voluntarily; and when you look at the scale of operations of local government in this country, the corruption that is in it is minute indeed—so much so that it makes the headlines when any is found out.
I believe local authorities are going to accept that, long term, there will be some financial benefits which will accrue to them from the implementation of this Bill. But, short term, local authorities are also concerned about the financial implications to them. In posing the questions I have, I am seeking clarification; and I should also like at this stage to apologise to your Lordships, and my noble friend Lord Melchett, as, because of the size of

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the list of speakers, I regret that I have to leave the House just before eight o'clock tonight and may not hear his reply to my questions. But I look forward to reading them in Hansard.
Personally, I support the principles of this Bill; it gives to the new and larger local authorities the power to control the development to meet social needs rather than the commercial pressures. It ensures that the whole community will benefit from any increase in development values. The implementation of the Bill, we all accept, cannot happen overnight; local authorities have neither the staff nor the money to take all the development land into community ownership in one go, which is why the Government are making the necessary transitional provisions. Fears have been expressed that the community ownership of land will dry up land supplies and cause a further decline in house-building. This is a nonsense. There is already three or four years' supply of housing land available for housing with either planning permission or in builders' land-banks.
May I say, in conclusion, that the impact of this Bill must not be under-estimated. It will be as drastic as was the introduction of the 1947 Town and Country Planning Code. The county and district councils will have to work very closely together to agree their acquisitions, the management and their disposal policy. Local government, by and large, are now implementing corporate management, and I believe that the local authorities, as they exist now, given the staff and the finance, are available to do the job, and are more than capable of doing the job which the Government are asking of them.
The Earl of ARRAN: My Lords, before the noble Baroness sits down, may I ask her one question. Is she seriously suggesting that there is no corruption in local government in this country?
Baroness STEDMAN: No, my Lords; I am not suggesting that there is no corruption, but I am saying that the corruption is so small that it makes headlines when we hear of it.
4.53 p.m.
Viscount DE L'ISLE: My Lords, I can assure the House that I will make at
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least one of the shortest speeches in this debate. Since we are to hear more details of the legislation to come before us, it would be wrong to go into details on the Second Reading of this major measure. I have had the privilege of sitting in your Lordships' House for 30 years. Looking round, and seeing so few faces of Members who were here when I joined the House, I realise how old I am.
Listening to the noble Baroness, Lady Birk, in her able and clear introduction, I noticed particularly her exordium: I was reminded of similar words spoken by predecessors on the same Bench during the nationalisation Bills of the first Labour Government after the war. I could not help but remember the significance of what has happened recently. I am not going to labour the House with statistics, but some of the major nationalised industries have cost the country between £500 million and £600 million.
There is a connection between this Bill and the nationalisation Bills. Then, the nationalised industries were set off with such high optimism and commendations by the members of Mr. Attlee's Administration. They intended that they should be independent corporations, that they should be self-accounting and not interefered with by Parliament. But what happens? Whether it be a Socialist Ministry in Office or a Conservative Ministry in Office, the temptation of Ministers and their advisers to fiddle and dabble in the affairs of those organisations falsifying their price system and underselling the market, has been totally irresistible.
If I had made those remarks a year ago, they would have received little acceptance, but now we have the authority of a Socialist Chancellor of the Exchequer that that free-for-all must go. The reason is that concentration of power in the hands of Government will lead to exactly the same distortion as it has led to in the case of the nationalised industries. I am not making a case today for private enterprise or nationalisation, but I am deeply concerned about power. I sat first in the House of Commons in 1944 and, with the noble Lord, Lord Home of the Hirsel, I was one of the rebels about the Yalta Agreement. Since then I have seen Europe divided by the

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Wall, I have seen the economics and politics of Clause 4 pervade the whole of the Eastern European and Asian Continent, and I do not believe we are immune in this country.
The noble Lord, Lord Foot, declared himself an adherent of the mixed economy. I do not know what that expression means. It has less authority than the doctrine of the Trinity and much less definition. The noble Lord in his speech said he did not know where he was going, but I could have told him before he stopped. He would get on to the electoral system. I was disappointed with his speech because there was a Liberal Party once which had some principles, and one of them was freedom. It recognised that you could not have freedom if you gave too much power to Government. It is because this Bill intends to give enormous powers to Ministers and their advisers—and it does not matter of which political complexion—that I have the gravest suspicions about it. I have the greatest admiration for local government; I was a member myself. I listened with great interest to the speech made by the noble Baronesses, Lady Stedman. I am making no attack on local government; but if you give it a task too great for it to do, if you confuse the interests of planning, acquisition and development of land, you are asking for all the difficulties, all the faults, all the misunderstandings and, I must add, all the liabilities for corruption which such a situation will surely demonstrate to us.
This Bill is not about welfare; it is about power and who shall have it. I believe that in all these great questions of State the people who suffer most are those at the bottom of the pile; the larger fish in the pond can swim on their own, but Parliament should stand for the widow, the orphan, the infirm and the poor. Parliament should see that powers asked for by Ministers should be defined arid safeguarded. It is no good saying "reserve powers". These are foreign to our legal system. You give the Minister power, and he will use it. I have heard Conservative Ministers damning Socialists for using power, but they do just the same. It is in the nature of power to use it; and it is in the nature of Parliament and our Parliamentary traditions to see that that power is given only sparingly.
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Pace the noble Lord, Lord Foot, I do not believe this Bill is free from Marxist overtones. After all, it is a perfectly intelligible doctrine, a doctrine that the Government and the Party are the guardians of the people's welfare. Being the guardians of the people's welfare, they must ex hypothesi, be good and incorruptible. As history shows us, who would now say Czechoslovakia would not be a happier place if it was under a free economy or even a mixed economy? Few people would dare to answer that question otherwise.
My Lords, I promised to be brief. We will approach the Committee stage of the Bill with eagerness to get to grips with it. We will examine not only the details but the principles which underline those details. I hope that your Lordships' House will not be overborne by any threats or any abuse from sources outside this House; that it will devote itself by day and, if necessary, by night, to looking at this Bill, at every clause, every detail and every word, examining it against the principles which I have enunciated.
5.0 p.m.
Baroness WHITE: My Lords, the noble Viscount, Lord de L'Isle, has said that this Bill is about power. I should have thought that the vast majority of people in the country would say that the last place in which they would wish power to reside was in the hands of land speculators. Therefore, from that point of view, I should have thought there was the strongest general support for the principle in the Bill that development value created by the community should revert to the community.
Viscount DE L'ISLE: My Lords, that is the whole point. Would the noble Baroness define "land speculator"? Is it a developer or an owner?
Baroness WHITE: My Lords, you have only to think of the conditions in 1971, 1972 and 1973 to know exactly what land speculation was, and if the noble Viscount does not realise what I am talking about then I cannot believe that he could have been actively observant in those years. He has, of course, fairly considerable experience himself in land matters.

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A great deal of what I intended to say has already been said by the noble Lord, Lord Foot, although I am not referring to his aberrations about the electoral system. I was very much with him, both in his general support for the principles of the Bill and also in some of his apprehensions as to its ultimate success. I am passionately anxious that this Bill should succeed, and what worries me, as it worries a number of your Lordships who are very sympathetic to it in principle, is whether it is not once again too complex a measure for its success to be assured.
A measure which will take so many years for its ultimate fulfilment could, in the normal course of our political life, offer too many opportunities to its opponents to stymie it, just as previous attempts in this direction have been frustrated. After all, as the noble Lord, Lord Foot, reminded us, it is now more than half a century since Lloyd George, when Chancellor of the Exchequer, first started to deal with what later became known in the Uthwatt Committee as the problem of betterment. I remember as a small child playing a game called "Brer Rabbit"—a much better predecessor of Monopoly—which was based on Lloyd George's land tax proposals. I was drilled very early in the increments of land value; and it is because we have had two attempts since the War, apart from the more historic ones made by the Liberal Party in the distant past, that one is so very much concerned and anxious that this time we should succeed. It is because I am worried about some of the practical problems concerning the Bill that I would have wished for some further explanation in addition to the very lucid summary given to us by my noble friend Lady Birk.
I am doubtful, as was the noble Lord, Lord Foot, as to whether the local authorities are the right instrument. I can fully understand why, after the difficulties over the Land Commission, the present Government feel that they should try another recipe. But this raises some very difficult questions of principle, it seems to me, because the local authorities are the planning authorities and, as planning authorities, their prime purpose is to be able to take a dispassionate view of whether or not a certain development
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is in the general interest. If they are going to have, as owners of land, a financial interest in the outcome of the transaction, then they cannot take a completely unbiased view. This is why I am concerned, at least for the English counties: in Wales we are proposing to have a somewhat different mechanism. I should very much like my noble friend who is to reply to the debate to deal with this matter of principle.
My noble friend Lady Birk emphasised and re-emphasised—as indeed Mr. Silkin has done in another place—the virtues of what Mr. Silkin calls "positive planning". My noble friend said that planning and ownership must go together, and she referred to the historic precedent of the old land owners, who were indeed both owners and planners. Some of the best urban planning in London, for example, was undoubtedly due to the unified control of certain landowners; and, if I may say so, we should not have had the magnificent city centre that we have in Cardiff had it not been for the unified ownership of land in the hands of the Bute family in past times.
But it does not seem to me that the analogy for local authorities is necessarily the same, because they are dealing with proposals for development which are not entirely within their own control. They are dealing with ideas and propositions put up by other people or bodies, on which they have to judge. I am entirely in favour of local authorities being able to obtain for their own purposes land which has not been subject to speculative increments; and the kind of example put forward by my noble friend Lady Stedman I am sure will echo in the minds of many of us.
It is plain that we wish to secure for public authorities the opportunities to obtain land at reasonable prices without the speculative element so that therefore they should get it free of betterment value. With that one entirely agrees. Is it necessary, though, for them to be the owners of all development land? Here I have consderable doubt on the matter of principle. Having expressed these doubts—and I do so partly looking not so much at the urban areas as at the countryside—I am concerned that, again for environmental reasons, the local authorities should be able to make a

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completely unfettered judgment as to what is best for the community.
I should like now to turn to one or two other matters of detail. I am also anxious, at the other end of the scale, about the position of the owner-occupiers of houses. I was a constituency Member when the first post war attempt at dealing with this land problem came into operation, and I am sure that one of the reasons which enabled the Conservative Administration to reverse that scheme was that it went into details over people's own personal homes, so that one had to go through complicated processes to obtain consent to do this, that or the other. Since then, far more people have become or are becoming owners of their own homes. One has therefore an even greater interest in not arousing the apprehensions of owner-occupiers.
I understood from my noble friend Lady Birk that this had been taken care of, but I must admit that the noble Baroness, Lady Young, then raised doubts in my mind as to whether in fact the owner-occupier was going to be, within his own small domain, secure in his home. I hope that the noble Baroness, Lady Young, was under some misapprehension in saying what she did, but I should very much like to have reassurance on this, because if you make the owner-occupier of, at any rate, the moderate or small-sized dwelling apprehensive as to his future security, then I think you will find it is extremely difficult to maintain this Bill against possible opposition.
Baroness BIRK: My Lords, I do not want to interrupt the debate but I would explain that I think the noble Baroness, Lady Young, misunderstood the exemptions under Clause 4. My noble friend Lord Melchett will be dealing with this matter in his winding-up, but as Lady Young was rather concerned about it I thought I should make that point. The new amendments concerning the compulsory purchase order also affect the whole question. There was a complete misunderstanding over the exemptions in Clause 4.
Baroness WHITE: My Lords, I am very glad indeed to hear that. I had not supposed the case to be as the noble
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Baroness, Lady Young, said it was, but the moment she began to express her own doubts I was, I must admit, very worried.
I was glad that the right reverend Prelate the Bishop of London gave as clear an account as he did of what had been happening over the position of the Churches and of charities. I am certainly in no position to speak for any Church, and in Wales the Church is in any case disestablished. But I am concerned with charitable organisations through being a member of the executive of the National Council of Social Service. We are very much concerned with the position of charitable land. A number of the points raised by the right reverend Prelate are ones we would certainly wish to pursue at Committee stage unless they have been settled by negotiation in the interim. For example, there is the question of land being used only for the charities' own purposes. This sounds unexceptionable until one begins to examine it in detail. Often there is a site on which it would be sensible for a charity to erect a building, nine-tenths of it (shall we say?) being for social or community purposes, but where it would be equally good sense to have, for example, a row of shops or some offices which would provide income for the current expenses of the activity concerned. Is "own use" going to cover that or is it not? I can see all kinds of complexities that may arise if one tries to circumscribe the position on charities in relation to development of their land.
Again, I do not want to go into the whole school situation, but if one wants to change the relationship between Church schools and other schools, or for that matter the public schools and the rest of the educational system, I hope we shall not use this as a backdoor way of doing it. A similar point applies to the minor but important sphere of the position of funds for redundant churches.
Unfortunately, the Addison Rules forbid my speaking in any detail about another aspect of this Bill with which I am concerned, and that is the land which belongs to public corporations. I am a member of the British Waterways Board and therefore am not allowed to speak on their behalf. But I know there are apprehensions among some public corporations as to what is to be the position

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of their land if the local authorities are to take over the land which the corporations feel they can develop to the advantage of the public duty which has been laid upon them. I believe it is an open secret that one public body at least—I am referring to the railways—has been sitting on sites which local authorities have regarded as being suitable for appropriate development. But I would hope that public bodies in general will not have to suffer because maybe one of their number has behaved in a shortsighted or selfish manner. It would perhaps be improper if I said anything more on this subject, but those of us who have strong Socialist convictions feel that a public corporation established by Government for the public benefit is every bit as much public as is a local authority.
Finally, I would say something about the Welsh position. I was sorry that my noble friend Lady Birk said so little about that. After all, it is something of interest, at least, that Wales should be presented with a proposition which is different from that for England. The Welsh districts and counties are of course the planning authorities, as they are in England, but the acquisition of land in Wales is to be in the hands of a special Land Authority for Wales. What sense does this make in relation to the gospel according to Lady Birk, where she said that planning and ownership were indivisible, or should be indivisible? The Land Authority for Wales, as I understand it, is not going to be a planning authority. It is going to undertake the transactions in land. Could we be enlightened as to what in fact is going to happen under Part II of the Bill? Is the Land Authority going to be a kind of general supervisory body? In other words, is it going to bestow agency powers on all the county authorities, at any rate in Wales? And, if not on all of them, how does it propose to discriminate between them? We need some further explanation as to how the Welsh pattern fits in with the philosophy of the Bill as enunciated.
If in fact the local authorities are going to be given the main responsibility for land acquisition in the Principality, then I know they have certain anxieties. They do not want to have to do all the work with the Land Authority breathing down their necks the entire time. They would wish
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to know whether they have to submit all transactions in detail to the Land Authority, or whether the Land Authority, presumably towards the beginning of each financial year, will give them general instructions and general guidance as to how much finance they are to receive for the period concerned. In other words, what is the relationship going to be between the Land Authority and the local authorities?
Baroness BIRK: My Lords, perhaps I may again help my noble friend. In an effort not to delay the House too long it may be I was a little brief on some of these points. The main point is that in regard to Wales, because it is a much smaller area than the whole of England, it seemed possible to operate through a Land Authority. But it will operate within the planning framework and consult local planning authorities on what is development land. That is covered in Clause 17(4). As to the scope of arrangements for authorities to act for the Land Authority on an agency basis—Clause 6 of the Bill—this is still under discussion. I have intervened now to explain to my noble friend as she quite naturally has raised these questions. It has not been finalised. The decision to make a separate Land Authority for Wales seems to me to be in line with the thinking on dispersal and devolution nowadays and it is, she will agree, a much smaller and more or less self-contained area. But so far as Clause 6 is concerned the matter is still open-ended.
Baroness WHITE: My Lords, if we have regional government for England will there then be separate land authorities for the regions in England, we wonder? Also, what will be the relationship of the Welsh Land Authority to the Welsh elected Assembly, when we get it?
Baroness BIRK: My Lords, we have neither at the moment. May we deal with just this Bill as it is at the moment.
Baroness WHITE: My Lords, I know it is very much easier for my noble friend to deal with just this Bill as it is at the moment, but naturally any of us who are concerned with public life in Wales wish to look a little further into the future.
Lord ELTON: My Lords, may I intervene to put on the record our concern also with its relationship with the Welsh

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Development Agency? There seems another whole scope for intermeshing which will need to be explained at an early stage.
Baroness BIRK: My Lords, may we take all that on Committee stage, when this subject will no doubt come up again and we can go into it thoroughly. As I was so brief on Wales and did not want to be appearing to show any discrimination or feeling against Wales, I felt I ought to intervene.
Baroness WHITE: My Lords, I am grateful to my noble friend, but she is speaking rather frequently without the leave of the House, I think.
Baroness BIRK: I was only trying to be helpful, my Lords.
Baroness WHITE: My Lords, I know that my noble friend was trying to be helpful, but this is one of the unsatisfactory aspects of a Bill of this kind which contains a great many matters, not merely of Committee stage detail but also of principle. However, the final practical matter which will affect us in Wales perhaps even more than in England, because we shall have a third stage of land acquisition and development, is that the counties and the districts in Wales should work together as a team. This matter has been touched upon in general terms in relation to the English counties and districts, but it appears to me that it will be even more important in Wales if one has also this tertium quid—the Welsh Land Authority. Therefore, I hope very much that when the time comes my right honourable friend the Secretary of State will make it very clear that he expects that the districts will co-operate with the counties in Wales so that when the Welsh Land Authority has to consider the problem of the acquisition and development of land for which it is not the planning authority, it will have definite, agreed advice on which to proceed, given by both the tiers of planning authority with which it will be concerned.
These are some of the matters which concern us very much indeed in the Principality. We have some time—we understand until October—before we shall reach the point at which we discuss these matters in Committee. However, it appears to me to be desirable that
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one should at least put my noble colleagues and the Government on notice that these will be some of the matters which we shall hope to have a chance of discussing further at that stage.
5.22 p.m.
Viscount GAGE: My Lords, for about 20 years I was the chairman of a county town planning committee in a fairly active part of the country. Perhaps my experiences there and advancing years make me somewhat cynical about Bills of this kind. The process always seems to be the same. First, you work up a great deal of indignation about the profits which are being made by landowners and speculators—profits that they have done nothing to deserve—and you illustrate this with startling and sometimes horrific examples of the prices obtained. Then you produce schemes which are designed to secure that the whole of this profit goes to the community, and you even hold out great hopes that the taxes or rates of the community will thereby be reduced.
The next part of the process is that gradually you find out that the land is no cheaper to the consumer and that the profits do not go to the community; they go to pay for the great administrative machine that has to come into play. Then you find that because the market has dried up the statutory bodies can proceed only by compulsory purchase and that the private builder can obtain no land at all. The noble Baroness, Lady Stedman, said that this was a nonsense, but the noble Baroness is a little overwhelming. I think she implied that the ACC was rather a nonsense, too. I can only say that I know that housebuilders are extremely nervous about their future. In other words, it is becoming apparent that the cure is getting worse than the disease. That is when a new Government usually come in, scrap the plan and produce one of their own. I am fully convinced that that is what will happen to this Bill.
The noble Baroness, Lady Birk, spoke as if there is a great deal that is new and revolutionary in this Bill. I have heard it before and I think that in fact quite a lot of it is rather "old hat". That is why I am so apprehensive about what will happen eventually to this Bill. I am also afraid that those who aspire to interest themselves in town planning and local government must accept the fact

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that they cannot yet hope to reach agreement on a long-term planning policy that involves Party politics. The scheme which came nearest to securing all-Party agreement was the one which has already been mentioned by the noble Lord, Lord Foot; namely, the scheme which was produced by the late Lord Silkin for whom I had a great regard. I myself believe that if he had put the development charge at 50 per cent. rather than at 100 per cent.—whether he wanted to do this but was prevented from doing so, I do not know—we should still be operating his scheme to everybody's great advantage. I think Parliament was quite wrong to abolish the whole of the development charge; they should have let it run at 50 per cent. to find out what happened.
Because that scheme was so successful in securing agreement it may be interesting to compare it with what is contained in Mr. Silkin's Bill. It seems to me that the most obvious difference is that Lord Silkin included a sum of £300 million to purchase building rights so that in exercising their planning functions local authorities should not have to think all the time about money. Although very many new values have been created by this Bill—values on which death duties may be charged and mortgages may be raised—there is no compensation as of right. All you can hope to do is to get something for hardship. And what is hardship? According to the original drafting of the Bill, it seems that as the Minister appoints the tribunals and sets the guidelines, hardship is whatever the Minister decides that it should be. I know that Parliamentary pressure has produced an amendment, and the guidelines now have to be approved by Parliament. However, I still think that this matter deserves a great deal more examination.
One claim that is made for this Bill is that for the first time it makes proper provision for positive planning. However, I remember that under previous legislation we conducted some quite large schemes for comprehensive development. I remember, too, the difficulties which we experienced, some of which, incidentally, may be relevant to our present debate. For example, we found that we had no expertise in what one might call commercial viability. The noble Baroness, Lady
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Stedman, talked about the difficulties involved in obtaining planning approval for old people's homes, schools and so on. That is fairly easy, but as I see it local authorities will be turned into land dealers. They will be selling land for all kinds of purposes, commercial and otherwise. We found that it was quite easy to make provision for shopping centres and offices but we did not know whether anybody would build the shops, or occupy them, or pay the rent. To help us, we had to find experts who had that special kind of knowledge. We found also that although we were on very good terms with the district councils it was not easy to obtain agreement without an enormous amount of argument and possibly the production of rival experts. I do not know whether modern local authorities are any more expert than their predecessors or whether they are any more ready to reach agreement, but I doubt it. Of course, there are fewer district councils. On the other hand, there are more Party politics. I can well imagine rival Tory and Labour schemes being produced. Under this Bill the relations between the county and the district seem to be even more complicated than they were previously. It is possibly that to which the County Councils' Association drew attention, as was pointed out by my noble friend Lady Young.
Quite frankly, in our present serious economic position I cannot see that we are likely to benefit economically from the passing of this Bill. I think that another speaker pointed out the reverse—that all the money which will be necessary to buy the land in the first instance and the extra officials which the Government think will be necessary for its administration will be bad for the economy of the country. We are told we must try to be constructive and it may be possible to devise Amendments which would have the effect of making the Bill more generally acceptable, although the proposals do not seem to have had a very active welcome so far. I have quoted the County Councils' Association. I have seen protests from insurance companies, and various charities, none of whom can be described as landowners or speculators. One of the most impressive criticisms comes from the Royal Institute of Chartered Surveyors, which I suppose some people might think represented owners,

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but I do not think that anybody could read it without being impressed by its close reasoning or would think that it was in any way prejudiced.
Certain policies have been mentioned but one of our difficulties is that Her Majesty's Government have given us reason to think that they are proposing to meet some of the objections. So far no Amendments on these very important matters have been tabled. I was most interested to hear the speech of the right reverend Prelate the Bishop of London and to note that he did not think the Church ought to be separated from other charities. I am connected with housing associations and I have been asked to communicate to the Government this respectful message. They say—
"Housing associations are anxious that important programmes of expansion which they are now tackling should not be held up by extra procedural arrangements. It is understood that the Government have undertaken to ensure that the work of these housing associations should be able to proceed unimpeded, although in the absence of any specific Amendment it is difficult to make precise comment. Nevertheless the Government's general intentions in this direction are greatly to be welcomed."
I certainly hope that their hopes will be gratified.
My Lords, I suppose we shall have to wait until mid-October until we know what the Government are talking about. I suppose it would be possible for this House to impose Amendments to make this Bill more generally acceptable. We might try to devise Amendments to meet complaints of the sort expressed by the National Farmers' Union in these words—
"Many of the assurances given by Ministers in Committee depend on regulations, orders or circulars. Assurance based on legislation of this sort or by administration leaves so much to trust and the National Farmers' Union will continue to press for agricultural safeguards to be written into the Bill."
We might try to remove some of the blight that falls on agriculture and on others forms of enterprise if the Ministers have these very wide powers and nobody quite knows what they are going to do with them.
I sometimes wonder whether the Government want to make this Bill more acceptable. Sometimes I feel that their line is that they are Socialists; they are going to give us Socialist policy, and if we do not like it that is too bad. It may
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be Socialist policy to give Ministers very wide powers in all legislation and not to put too much into Bills. They are entitled to these views, but it must be apparent that the more Socialism we have in a Bill the less likely we are to have continuity of planning in future, and the more likely we are to get back into the same dreary round of Bills, repeals, new Bills and so on. I do not suppose that I shall get any answers to this, but we shall have to keep our fingers crossed and hope for the best.
5.35 p.m.
Baroness HORNSBY-SMITH: My Lords, first may I add my congratulations to the noble Baroness, Lady Birk. In my 20-odd years in another place and here I have rarely seen a Minister have to produce a Bill the final shape of which she does not know. Whatever our objections to the Bill may be—having in a modest way had experience at the Dispatch Box—I would be the first to congratulate the noble Baroness on making the best of a Bill the ultimate form of which she cannot possibly yet know.
Few people in this country—and this to me is one of the saddest and most serious things about the Bill—have any idea of the erosion of their age-old rights and liberties that are enshrined to the ultimate in this Bill. The Commons are still wallowing in its complexities, and before it has been fully dealt with in another place it is being stampeded through this House, with amendments galore having to be made by the Government. The noble Baroness has circulated a list which tells us that the Government intend to make certain amendments. Those of us who have endeavoured to keep up with the debate in another place because we wish to show an interest in this Bill in this House can at the moment deal only with what are the Government's intentions as listed in the Bill. At this time very few of the entire galaxy of legal talent in your Lordships' House—and it is a very formidable band of lawyers—could give firm counsel on what this vicious Bill imposes on the free citizens of this country. Perhaps, my Lords, that is why, with one or two notable exceptions, noble and learned Lords are in the main conspicuous by their absence this afternoon.
It is another interesting fact that when the Government are handing out benefits

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they produce excellent booklets telling us what we are entitled to claim, but in this Bill they are empowering local authorities, if they so wish, to declare as development land virtually everything except a quarter of an acre around one's own home. They are taking away the freedom and the rights of the people of this country, and, as the noble Baroness, Lady Young, pointed out, without the majority of people even knowing what is to happen to their property. The Bill attacks the basic rights of an individual to the protection in respect of his property which he has hitherto enjoyed within the law. Not only does the Bill allow his land to be compulsorily, or so-called voluntarily, acquired but it limits his right to voice his objection by public inquiry almost to the point where it does not exist at all.
We have three suggestions before us. Schedule 4 lays down the circumstances where there is an absolute right to a public inquiry, but under subsection 4B(1) the Secretary of State is allowed to suspend the right to a public inquiry indefinitely by five year periods. This afternoon we are informed that in relation to Schedule 4, Part I, the Government propose to redefine and qualify the circumstances under which the Secretary of State may dispense with a public inquiry. A public inquiry is of the very essence of democracy, and is the right of an individual, a corporation or a charity to be heard and to put their protests. In its original form, the Bill allowed no form of inquiry, and in its amended form the effect has not really been changed. Any rights it now proposes to allow may be suspended by Statutory Instrument which will not have the same penetration and consideration in both Houses as does the Bill itself. It puts all owners and developers under restraint without spelling out the charges. It is government by order and not by Statute.
We have now a situation wherein the local authority can take land for development; they can take land from owners where they, the local authority, have previously denied the right to develop that same land, possibly for the same purpose. They can take common land, they can take open spaces, they can take, village greens. They can acquire land, which a prudent industrialist or a farmer has
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invested in for future expansion and development as his own contribution to his industry, which the local authorities can then sell back to the victims at a profit, or they can sell it to the original owner's competitors; and there is no challenge or appeal within the right of the original owner.
Let us also note the quite unprecedented Ministerial powers. The form of this legislation is such that the bulk of plans which enable the original aim of this Bill to be effective will be contained not in this Bill at all—which, after all, is subject to the scrutiny of both Houses—and the real draconian powers will be included in subsidiary legislation which is not debatable in this House to the same extent. The wider the powers given in Statutory Instruments the fewer are the controls that can be exercised by the courts as they become more and more circumscribed in their ability to say when an act of a Minister by an order or regulation is ultra vires to his powers. The result is that a Minister cannot be attacked or legally attached unless through a political tribunal. The enormous powers which we are taking away from the citizen in his rights under planning arrangements, under appeal, even in the courts, are something which the overwhelming majority of the people in this country have just not recognised in the tremendous complexities of this Bill.
Under Clause 17, going from the major to the minor—to say from the sublime to the ridiculous is unfair—the minor may be a very deep consideration to somebody who, over the years, has saved for their retirement and perhaps has a paddock or an acre round their house. Under Clause 17 a malicious third party—even one's own next door neighbour, or a covetous industrial rival—has merely to apply for planning permission on a site he does not own to enable a local authority to start acquisition proceedings against the rights and interests of the true owner. As this Bill stands, it gives just that power. The scope for malice and malpractice is really absolutely horrifying. Every MP has listened to bad neighbours' complaints in their time, but in the future it will not be necessary to bash in a fence or throw your garbage over the wall; you just

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apply to build your mother-in-law a cottage on half your neighbour's garden or the farmer's paddock and, bingo! the Government then legally can acquire that part of your property, whether or not they let the original applicant have it. With the Treasury and the local authority grabbing all the advantages, there is very little incentive, although as I understood the noble Baroness, Lady Birk, there was to be a little edge for the developer in the figures she gave us this afternoon. But what would be disastrous is that we should have an absolute stalemate on the passage of land and the availability of it and freeze up the market.
In the final analysis, the local authorities will have a monopoly, with the victim having only a very limited right of appeal still not yet firmly defined. Nor, necessarily, will they have the right even to present their case in person to the local authority officials. Anyone who has ever studied a local authority's planning committee agenda knows how often hundreds of decisions skim through without any detailed consideration by the councillors and almost automatically on the officer's recommendation and opinion. But at least now the applicant has a right of appeal. Under this Bill, even with its amendment, that will be monumentally limited. We are told that the authorities will require 12,000 more staff—bureaucrats who can destroy your livelihood or carve up your property if they do not like the look of your face or if they consider it personally advantageous to ensure that Mr. Local Bigwig acquires the land which his competitor long ago prudently acquired for extensions. I am deadly serious in saying that the scope for corruption is positively terrifying, with no proper democratic safeguards to protect the citizen from victimisation.
Then we have the two voices of Government. In April, the Chancellor of the Exchequer thundered out to us that we have to reduce the borrowing requirement by over a £1,000 million this year, and that it is absolutely essential. This monstrous Bill will require capital borrowing of the order of thousands of millions of pounds over the next 10 years and it will cost £1 million a day to administer. What sort of double talk is that in the grave financial crisis facing us at the present time? Local government finance is already in a state of chaos.
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They have hardly yet digested the local government reorganisation and now they have thrust this monstrosity on to the conflicting interests of Ministers, county councillors, nationalised industries, local governments and new towns authorities, who must co-operate. To co-operate they will possibly be working from conflicting stances in an endeavour to identify the same object for their powers at the same time.
I should like to emphasise another example of two faces. The previous Conservative Governments and the present Government have between them set up a great network for consumer protection. We have been flooded with propaganda about the rights of the individual. We find that those who invest in cars, in "hi-ti", in deep freezers and all the accoutrements for "keeping up with the Jones" are to be protected, but if you put that equivalent expenditure into an acre of land round a modest four-roomed bungalow then under this Bill you are not subject to consumer protection and your investment which you choose for retirement or your little shop, has not the protection for that acre. The protection covers somebody who joyously lives in a council house and runs a Jaguar—and if anybody says that is not possible I will show them 20 in my old constituency. There again we have the two angles the citizen who has a mite of property is a sinner, but the person who wants to buy everything on the "never never" and live beyond his means is not.
Much has been claimed for this Bill and in some quarters it has been pretended that it will solve our acute and desperate housing shortage. The GLC at present owns and has in its possession enough sites to build tens of thousands of houses. We are now going to give the boroughs the opportunity to grab still more development land which they will dispose of at market value, so that no savings accrue to the housebuilder or, later, the house-purchaser, due to possibly, the amendments which the noble Baroness gave us this afternoon. Unless we are very careful the land will be scarcer and dearer, and there will be fewer and more expensive houses.
At this moment, the bulk of the land won for housing has been gained by builders and developers ferreting around, finding land, and then winning it on

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appeal against obstruction from local authorities. These appeals and the time-lag add an average of some £500 to a house. Builders are now not allowed to lay a brick until the local authority has first acquired the land, possibly by compulsory purchase, and then disposed of it to the developer of their choice. As a result, I believe delays will be endless. I do not believe local councils can possibly cope with even a fraction of the total of 200.000 new private developments currently started every year.
My Lords, I am not against stopping the exploitation of land development. I believe it can be fairly dealt with by taxation, and not by land confiscation. I believe we can deal with the Rackmans, or anyone like them, by taxing them on exploitation, on betterment. But do not let us stultify what is far more likely to provide the homes and services we want if we allow co-operation—planning permission by all means—by the local authority. But if we want to give these draconian powers to the local authorities and create this overwhelming monopoly, then I believe it will not even necessarily have to wait for a Conservative Government. Noble Lords opposite within months will find just how it is stultifying development.
The Domesday Book registered and listed properties and sites in this land 800 years ago. Today, many who were then listed proudly boast of antiquity in their heritage. I call this Bill "the Doomtrek Bill", because it confiscates property, destroys the freedom to sell, denies human rights—and I am not sure that it does not offend against Clause 17 of the Human Rights Charter—and breaches common human justice. It will produce chaos out of confiscation and complexity. We shall be very lucky if there is not also corruption as the twin offspring. It has only one merit. It is so economically lunatic at this moment that I believe it will contribute to bringing down the Government.
Baroness GAITSKELL: My Lords, before the noble Baroness, Lady Hornsby-Smith, sits down, may I ask her a question? She said that the hunger for development land that there has been over the years could be dealt
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with by taxation. The noble Baroness also said that this Bill is lunacy. How is it, then that consecutive Conservative Governments have not done this?
Lord MOWBRAY and STOURTON: My Lords, what about the noble Lord. Lord Barber?
Baroness HORNSBY-SMITH: I did not say, "hunger for land". The noble Baroness, Lady Gaitskell, misunderstood me. I said that I thought the exploitation of those who gained unduly from the betterment of the land could be best served by taxation.
Baroness GAITSKELL: Why then have you not done it?
Lord MOWBRAY and STOURTON: My Lords, the noble Lord, Lord Barber, did it.
Baroness HORNSBY-SMITH: We did it, my Lords.
5.54 p.m.
Lord BROCKWAY: My Lords, I am very glad to follow the noble Baroness, Lady Hornsby-Smith. We were in another place together, and were nearly always in conflict. She will not be surprised if I do not find myself in agreement with her views tonight. My impression is that she has given a caricature of this Bill.
Several Noble Lords: Hear, hear!
Lord BROCKWAY: My Lords, I am perfectly sure that when the noble Lord the Minister replies, and when we discuss the Bill in detail in Committee, many of the charges made by the noble Baroness—
Lord MELCHETT: All of them.
Lord BROCKWAY: Someone has suggested "all of them"—certainly many of the charges made by the noble Baroness against this Bill will prove to be untrue.
I do not often speak on domestic issues in this House. This is not because I am not deeply concerned. I am a Socialist, and I believe that nearly all the evils of our time—inflation, unemployment and wage conflicts—are due to the system of capitalism. I believe that only by Socialism will we move towards their solution.
Lord HARMAR-NICHOLLS: Another caricature!
Lord BROCKWAY: My Lords, the older I get, the more Left I move in that conviction. But many years ago I took the advice of Charles Trevelyan, that if one is to be effective in politics, one must specialise. With my colleagues James Maxton and others, I agreed that they should deal with domestic issues, and that I should concentrate on the freedom of peoples, on peace, on racial equality—a broad enough sphere!
I feel impelled to speak on this Bill because I agreed with the Minister quoted by the noble Baroness, Lady Young, as saying that this is the most Socialist Bill that our Government have introduced. My Lords, this Bill together with the Development Land Tax Bill, which will follow, provides for all development land to come under community control, and to restore to the public the profits arising from increased land values due to community action. That is pure Socialism. We are not surprised, therefore, by the intensity of the Opposition's views, by the opposition of the Tory Party to this Bill. We challenge it to go to the country upon this right of the community to take to itself the values which the community provides.
I admit that I have also been motivated to speak tonight from nostalgia. I have been involved in the struggle about land through all this century. The real author of this Bill is Henry George who, at the beginning of the century, urged that land values should go to the community which created them. I read his works in 1905, and I joined the Young Liberals because they were enthusiastic for the views of Henry George. It is impossible today to appreciate the great influence which he had on radical thinking at the beginning of this century. He prepared the way for another George—Lloyd-George. This House came into conflict with him in 1910, when he sought to give to the community the values which the community itself had made. How I remember those times! The Limehouse speech: "God gave the land to the people". I can almost recite passages from it now. I was interested to learn only last week that a Member of this House wrote the draft of Lloyd George's Limehouse speech. I am quite sure that he did not keep to the text; Lloyd George never
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did. But there, in conflict with him, this House made the great mistake of challenging the views of Lloyd George; not that land should entirely belong to the people—I wish that he had fulfilled the words of his song—but even over the contribution which he made towards that. The House of Lords made its great mistake.
I am absolutely incredulous that anyone should believe that individuals have the right to the ownership of land. I go to Scotland and see the eternal majesty of its mountains; I walk on the Yorkshire Moors; I stand on Leith Hill and see the landscape of Kent as far as the horizon—all that, the contribution of centuries of evolution, the heritage of all mankind. How dare any individual claim private possession of what has been contributed to mankind through the ages?
Baroness YOUNG: My Lords, I am sorry to interrupt the noble Lord, Lord Brockway, in his very moving reminiscences, but do I understand him to mean that he does not believe that anybody ought to own their own house, and that he is pleased that the Bill makes this impossible?
Lord BROCKWAY: No, my Lords, I do not mean that. One has a right to own one's house. One has the right to own one's garden at the back of that house. I do not believe, with the homelessness of today, that we have the right to own more than one house, and I do not believe that we have the right to own the houses of others. When I am speaking of the ownership of land, I am speaking about these vast spaces which man did not create, which the right reverend Prelates would say are the creation of God, which I say are the creation of the great creative life force through the ages.
Lord REDESDALE: My Lords, can the noble Lord tell us by any chance whether we are entitled to own farming land?—because much of the land we are talking about is cultivated.
Lord BROCKWAY: My Lords, I will be dealing with that. I would want to see the land owned by the community, and I should like to see co-operative farming upon it.
Lord REDESDALE: My Lords, does the noble Lord know that quite often this is not very well farmed?
Lord BROCKWAY: My Lords, perhaps it is just as well that I did not hear that intervention, because I think I have now had enough of such interventions. I am very glad indeed that at last in this dull debate I have created the real conflict between that side and this side, which is the conflict as to whether the people should own the land, and whether they should own the values which the people themselves have created.
I did not intend to speak long, and I end by saying this: This Bill, with the Development Land Tax Bill which will follow, will enable the community to receive from April next at least 80 per cent. of development gains which occur because of the activity of the community. It will enable local government authorities to possess land requisition powers and so positively plan the pattern of their towns and the relationship of development to the countryside. The cost of land will be reduced by one-half to the local authorities, making housing schemes so much easier. My Lords, these are great projects, and I hope that the House will refrain today from repeating the mistake which it made in 1910 in opposing the principle that the people have the right to the common ownership of the land, and that they have the right to the values which they themselves have created.
6.7 p.m.
Lord SANDYS: My Lords, it is often a pleasure to listen to an old record. We have heard it several times before, and we know that the noble Lord, Lord Brockway, holds his views passionately, but I have rarely heard him in better voice than I have this evening. I could not hold a more opposite view to the noble Lord, because I must declare an interest as an owner, as a trustee, as a school governor—I could go on for a number of interests which I should and do declare, but I feel that the House has listened already to eleven speeches, we are now at the half-way point, and I must restrict myself to about nine or ten minutes at the outside.
The impression I had on reading the White Paper before us, Land, was, first of all, how much I agreed with the first sentence or group of sentences in one respect, and I do not think that many people in your Lordships' House could
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disagree with the statement referred to by previous speakers:
"to secure a proper balance between the competing demands for land, so that all the land of the country is used in the best interests of the whole people."
Those words were spoken by the late Lord Silkin, a figure who was much respected and whose lifetime in the field of planning extended until he saw a second Planning Act established in 1968. I should like to express from these Benches a view with which I am sure my colleagues will agree, that the Labour Party greatly lack his wisdom today in bringing forward the measure we have before us. I am convinced that had he still been in office with his colleagues, the noble Lords, Lord Kennet and Lord Greenwood, whose absence we lament this afternoon, we should be seeing a very different Bill before us.
The hallmark of the view of the noble Lord, Lord Silkin, in the planning field was to establish a fair system, a system which provided for both the community and a very delicately adjusted system of balances between the owner and the local authority. We have, of course, listened with toleration to the speech of the noble Lord, Lord Brockway, and rarely do we hear the genuine record of Tammany Hall so accurately as we do from the noble Lord's lips, but this subject should be debated in your Lordships' House in a quieter atmosphere if we are to bring our minds to bear on what is an exceedingly complicated subject.
My noble friend Lady Hornsby-Smith referred to two matters of great importance. The first is the removal from the individual by confiscation. On this subject I feel—and I agree with everything she said—that confiscation should be investigated and a definition of the word "confiscation" (which does not appear in the Bill), should receive the attention of your Lordships. I discovered from the Shorter Oxford Dictionary that four meanings have been given to the word "confiscation", starting significantly in the year 1662, after the restoration of the Crown and the restoration of the seguested estates to those who previously owned them. The meaning of "confiscation" up to 1662 was:
"To deprive of property as forfeited to the State."

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One hundred years later "forfeiture" had this meaning:
"To seize as if by authority."
A little later than that it meant:
"To appropriate private property to the public Treasury."
Later still—this is the final of the four descriptions of the word—it meant:
"Robbery under legal authority."
Lord MELCHETT: My Lords, apologise for interrupting the noble Lord in the midst of an interesting historical analysis of the word "confiscation", but may I ask him whether he accepts that the reason why the word "confiscate" does not appear in the Bill is because the Bill does not give any power to anybody to confiscate anything? In particular it does not give anybody the power to confiscate people's homes. Property may be bought from somebody at its market value, but that is not, as I understood his careful exposition in the name of the word, what "confiscate" means.
Lord SANDYS: My Lords. I am obliged to the noble Lord, Lord Melchett, for that intervention because it gives me the opportunity of bearing out what my noble friend Lady Hornsby-Smith was referring to in Clause 17, and by the transposition of the word "confiscated" for the word "development" we have the following interesting revelation:
"Part III. Community Land, confiscated land.

(1) In exercising their functions on or after the first appointed day every authority shall have regard to the desirability—

(a) of bringing confiscated land into public ownership…"

That is the real meaning of the Bill. I am in absolutely no doubt whatever about it, and I believe that in the earlier part of the interpretation clause, Clause 6, the Government have failed to provide sufficient definitions.
We had some lamentation earlier from the noble Lord, Lord Foot, that the first nine clauses of the Bill dealt almost exclusively with the description of different terms, but perhaps the most significant term appears in Clause 6(1) where, referring to Scottish law, it says:
"'easement', in relation to Scotland, means servitude."
In my view the whole of this Bill means servitude, because it sets out to confiscate property, to enable the State to gain
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possession by a most complicated means which the vast majority of the population will fail to understand until it happens to them.
I am anxious not to delay the House, and I shall concentrate my remaining remarks almost exclusively on the subject of the impact that the Bill will have on agriculture, and I agree wholeheartedly with the National Farmers' Union who believe that from the start the rural implications of the Bill have been badly' underestimated. I feel that there are five illusions about the Bill cherished by the Goverment and I suggest that we take the wraps off these illusions because this is important if we are to understand the meaning of the Bill to its full. The first illusion is that the impact on agriculture may be minimal. The promise of exemption in paragraph 35 of the White Paper has not been fulfilled in the Bill, and this is a point of major importance. The second illusion is that current use value will be sufficient for the full-time working farmer. The principle of equivalent reinstatement has been set aside and I challenge the Government to tell us that this is not so. The third illusion is that owners still have rights—in paragraph 26, for example, the right to require a local authority to acquire their land. Owners lose that right, as we shall discover when we go deeper in Committee into this matter, and I believe that once this is appreciated by the people of the country as a whole the Government will realise the extent to which the whole of this measure is totally unacceptable.
Lord DAVIES of LEEK: My Lords, is the noble Lord implying that if I or any other noble Lord as a farmer wishes to extend his farm for economic reasons or for the good of the country, he will not be able to do so under the Bill? I see nothing in the Bill to prevent a farmer from expanding. I see nothing to prevent this in any form of agrficulture or in relation to expansion for woodland purposes.
Lord SANDYS: My Lords, we all know that the heart of the noble Lord, Lord Davies of Leek, is in the right place and he frequently tells us of his experiences, but perhaps I might respectfully remind him that he made one important error last week in regard to the agricultural land loss. I will not burden him

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with the explanation of it, but he will remember that the loss of agricultural land is now running at the rate of over 70,000 acres per annum. This is highly significant and of course a farmer is quite unable to expand in view of the totally urban base of this White Paper.
Lord DAVIES of LEEK: My Lords, I beg the noble Lord not to exaggerate. It is the motor car that is eating up most of the urban land and the massive roadways we are building to cater for the motor car.
Lord SANDYS: My Lords, it may well be that motorways are consuming a very large proportion of the stock of land mentioned in this figure—the factor of 70,000 acres per annum. I would not dispute that for a moment, but I would dispute that farmers are going to be able to expand in view of this tremendous land loss. The fourth illusion to which I was referring is the fact that care will be taken to avoid good quality agricultural land being taken wherever possible; in other words, we will protect the best quality farm land. I believe this is an illusion and that it is put in many measures in order to pacify those involved in agriculture. I have seen from repeated reports of planning inquiries how agricultural interests are often set aside. The last illusion is the suggestion that the position of the owner occupier is secure. This is the most important of all and it was referred to by my noble friend Lady Young, my noble friend Lady Hornsby-Smith and the noble Viscount, Lord Gage. We honestly believe that the position of the owner-occupier is most severely prejudiced as a result of almost every part of this Bill.
6.20 p.m.
Lord MACLEOD of FUINARY: My Lords, like the last speaker, I am conscious of the passing of time and I intend to be very short and to confine myself to one issue only. That is the issue of the credits and conditions being given to the Churches and to certain charities. Perhaps I should declare my interest, if that is the right phrase. I happen to be a Minister of the Church of Scotland, but I doubt if I should have taken up your Lordships' time at this point in the
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discussion, because I understand that the matter will come up again in October, were it not that I have had a written request from the Church of Scotland to make three remarks. The first is that we identify ourselves with the right reverend Prelate the Bishop of London in all he said. I do not intend to repeat it, but he very well expressed our gratitude to the Government for the concessions that they are adumbrating and which will be clarified in the Bill and the clause in question when it finally comes forward. We wish to thank the Government very much.
In the second place, I should like to say a word to those noble Lords who may possibly be a little surprised at the concessions that are to be made to the Churches. They may quite reasonably think—and this is really for their sakes when it comes up for final decision—that the Churches are lying back and relying on the concessions which some of the clauses may give them, and that they will be receiving money for the church extension charges and so on by reason of people moving from the centre of towns. It is only for the sake of brevity that I say that I happened not very long ago to be the chairman of the Church Extension Committee of the Church of Scotland. I mention that only because we were very concerned and we went round every presbytery from Orkney to Berwick asking people to give money lest anyone should suppose that we were lying back on gifts or concessions from the Government. Something like £200,000 was raised in a very short time from trusts and from individuals, and since that date some £300,000 has also been raised from trusts and individuals. I am simply making the point that we are grateful and that we are not lying back on what the Government may do for us.
Thirdly and lastly, I should simply like to identify the Church of Scotland with the hopes expressed by the right reverend Prelate in relation to certain rough edges in all the great concessions for which we are grateful. They require clarification. Those which he mentioned and which I shall not repeat are precisely the issues which the Church of Scotland also wish to clarify. I end by repeating that we are extremely grateful to the Government.
6.23 p.m.
Lord PITT of HAMPSTEAD: My Lords, in the first year of its executive authority—that is 1965–66—the Greater London Council paid £51,000 per acre for housing land. Four years later, in 1969–70, the figure was £80,000 per acre. Three years later, in 1972–73, it was £133,000 per acre. One year later, in 1973–74, it was £294,000 per acre. In other words, the cost of housing land in Greater London had increased by 600 per cent. in less than 10 years. Clearly, there are many other factors involved besides development value, but it is at least one of the factors and its reduction would play a big part in reducing the cost of housing to the tenants, the ratepayers and the taxpayers. It would also reduce the cost of schools, hospitals, welfare clinics, roads and public spaces. Let us not forget that the cost of land has a direct effect, not only on housing and rent but on the rates, on taxes and on all the goods and services provided from the buildings put up on that land. In other words, the cost of housing land and land generally affects every member of the community as a ratepayer, a taxpayer or a consumer.
Therefore, any policy aimed at reducing the burden of such an enormous cost in housing land is of the utmost importance to the community and the suggestion that this is not the right moment to introduce such a Bill is one that I could not possibly countenance. The Bill is relevant to all the issues that are confronting us at the moment. It gives legislative effect to the objectives indicated in the White Paper; that is, it will enable the community to control the development of land in accordance with the community's needs and priorities and to restore to the community the increasing value of land arising from its efforts
In so far as the first objective is concerned, our existing planning system—and I must spell this out—admirable though it may be in many ways, has one major inefficiency. It is that it is too negative. It leaves the initiative as to what kind of development shall take place and where it shall take place too much in the hands of private landowners and developers. Planning authorities have the power, if they can afford to exercise it, to prevent undesirable development, but it is far more difficult for them to ensure
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that desirable development is carried out in the places and in the forms which meet the needs of the community rather than the dictates of profit. The Bill is largely concerned with enabling planning authorities to plan more positively by giving them the power to acquire land which is to be used for private development. In other words, to their existing powers of negative control are to be added positive powers of land ownership.
I find it difficult to accept much of what I have heard this afternoon, because I should have thought that this scheme would be welcome to any person or body who believes that the needs of the community as a whole should have priority over individual or sectional needs or gains. I believe that the vast majority of people would feel that way. I welcome the objective of the Bill as it gives effect to the White Paper. I believe that local authorities, which are the representatives of and are accountable to the community, are the right bodies to operate this form of land development control. I am glad that, for the first time, they will be able to take the initiative—because that is what they cannot do now—in planning rather than merely responding either by granting or refusing to grant permission for development proposals which are made by other people who are usually private landowners.
Now they will be able to decide as a matter of positive policy where development is to take place, and to ensure that the right land is brought forward at the right time and in the right place for development; and that it is able to conform to the implementation of national, regional and local plans. They will no longer merely respond to market forces. The disadvantage of market planning is that it tends to increase the problems of urban society, such as overcrowding and long journeys to work. It has the effect of causing the decline of city centres as places to live; the reason being that the local authorities find themselves needing to worry about the cost of land, and therefore needing to seek the cheapest sites to provide the services.
City centre sites, which are usually the places where the services are most needed, are usually too expensive to buy, and so less suitable sites, two or three miles away, are usually bought to

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provide the services, which means that the facilities do not have the value that they ought to have. The noble Baroness, Lady Stedman, touched on the issue very well when she illustrated it by mentioning old peoples' homes, but it is true of most services. This is one of the things which this Bill, if given a chance to work, can help to combat.
The second objective of the Bill, which will enable the community to benefit from the increase in land values caused by its own efforts, will be achieved in the long term by enabling local authorities to acquire development land at current value, and not at an inflated value, which may well have been created by the community itself as a result of the provision of urban amenities, such as roads and schools, or the planning permission which the community itself has provided. The Greater London Council—which has been mentioned more than once—strongly supports this Bill. It believes that the main agencies dealing with the acquisition of land under the Bill should be accountable to the needs and wishes of the community. Therefore it welcomes the functions which have been allotted under the Bill to local authorities. The council is conscious of the importance of the functions which the Bill confers on local government, and it is confident that local government will rise to the challenge.
The council is also very much in favour of the fact that it is required that all these policies should operate in the open. We at County Hall believe in open government, and our committees and subcommittees have been open to the public long before we were ever obliged by law to open them. The council has started working on this Bill in anticipation of its becoming law, and the council and the London boroughs are co-operating already in preparing land acquisition and management schemes for London. A draft has already been prepared by the officers of the Greater London Council and the London Boroughs' Association along these lines.
My Lords, having said all the positive things, I now need to make a few criticisms. They are mild, but they are criticisms all the same. For example, we are sorry that the opportunity has not been taken to make further provision for local authorities and developers to
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combine for positive planning purposes. We believe that this is a fruitful field of operation. Section 52 of the Town and Country Planning Act 1971 provides for planning agreements to be made by authorities with developers, but the power is limited to planning agreements as such and does not extend to forming consortia for development or matters of that sort. We believe that this is a useful thing to do. In fact, we believe in it so much that at the request of the London Boroughs' Association the Greater London Council attempted to provide such arrangements for London in Clauses 9 and 10 of the recent general powers Bill which passed through your Lordships' House. Of course, Clauses 9 and 10 were removed from that Bill in another place, so that when the Bill got here your Lordships did not see those proposals. But we attempted in Clauses 9 and 10 to give such powers to authorities in London. We think that this Bill provides a splendid opportunity for providing these provisions for all local authorities nationally provisions, which we believe, could be quite valuable, particularly in developing areas.
I repeat, I have given wholehearted support to the Bill. But while doing that I must indicate areas of concern, one of which relates to the financial provisions in Clause 45. The Minister has indicated that where there is a surplus the Treasury will take 40 per cent., the local authority gaining the surplus will get 30 per cent., and other local authorities will get the remaining 30 per cent. Local government finance has been such a problem. Regardless of Party, we have all along been so worried about the need for additional sources of local government finance that we now have the Layfield Committee looking into the matter. Here is an opportunity for an additional source of capital finance for local authorities, yet central Government are to take nearly half of the surplus—40 per cent. I should have thought that here was an opportunity for leaving in the local authority sector such surplus as is realised, and I agree that half of it perhaps should go to the authority creating the surplus and the other half should be divided among the other local authorities, particularly those in deficit.
There is not only the point that central Government are giving this distribution

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which was announced this afternoon. The Bill, as it is, does not make it obligatory on the Minister, for example, to give, say, a large percentage to local government; nor does it even make it necessary to distribute to local authorities the proportion that the Minister has had returned to him. Clause 45 is permissive. It says that the Minister "may"; he is not under any obligation to do so.
This is an opportunity missed, and I hope that the Government will look at this aspect again. I know of the problems which every Government have with the Treasury; the Treasury will take everything if it can get it. But I hope that the Department of the Environment will fight the Treasury on this. Here is an opportunity for an additional source of finance for local government, one which ought not to be taken by central Government.
The other thing which concerns me is the fact that the Government seem determined to exercise a very tight central control over local authorities in the way in which they implement the Bill. I know that that will please many noble Lords who have spoken so far, because I have the impression that there is a feeling in this House that local authorities should not be entrusted with very important tasks. Although that may be the view of a lot of Members of this House, it runs contrary to what is stated in Paragraph 24 of the White Paper which says:
"the acquisition and disposal of development land is best left in the main to local authorities."
I agree with this; but the provisions in the Bill itself and all the circulars, regulations, guide notes et cetera suggest that the Department of the Environment do not agree with this and wish to exercise a very tight control over local government in this matter.
My Lords, perhaps I can give an illustration. Clause 43 requires the Secretary of State's consent for the disposal of an interest in any land greater than a lease for seven years. This provision applies to all land and not just land acquired under this Bill.
Lord DAVIES of LEEK: It is Clauses 43 to 48.
Lord PITT of HAMPSTEAD: Yes, my Lords; it is not just land acquired under the Bill but all land. Therefore,
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it amounts to a repeal of Section 123 of the Local Government Act 1972. I do not know whether the Secretary of State or other Ministers in the Department of the Environment were fully aware of this. When those of us in local government saw Section 123 of the Local Government Act 1972 we welcomed it as an introduction to, a step towards, the relaxation of the tight control that Whitehall previously exercised over local initiative. I speak here as a member of the GLC which has never been subject to those controls in any way; so that we speak for other local authorities. In effect our control is through the money Bill at the beginning of the year. It is a strict enough control, but after that we are not restricted in the way the others are. But it strikes me—and I think I am right in saying that it also strikes other people reading Clause 43—that now any land for which any local authority has more than a seven year lease, cannot be disposed of except with the permission of the Secretary of State. I think that that is a retrograde step and I hope that the Government will look again at this also.
My Lords, I should also like to refer to the retained surplus in the community land surplus account. Again, the Secretary of State must give his authority as to how that retained surplus should be spent. This is an additional control on local government which, in effect, could turn out to be very restrictive. Speaking for the GLC, I may say that we are not accustomed to dealings of that sort with the Government. Therefore, I feel that the Government need to look again at this idea of preventing local government from getting out of hand. I recognise some of the fears of central Government and, listening to some of the speeches this afternoon I recognise some of the fears of some noble Lords. With all its imperfections—and we know that it has imperfections—the local government system in this country is much admired in most parts of the world. Let us not denigrate it, please.
Moreover, and again I come back to the Government, I mentioned the way in which Clause 45 is drawn. In effect, it requires that the local authorities trust the Secretary of State. He is under no obligation as to what proportion of the surplus he takes; he is under no obligation to distribute it to local authorities

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other than to the authority making the surplus; therefore local authorities must rely on his fairness and good will. It strikes me that if you need to trust, then the trust must be mutual. Therefore I would ask the Government to think again on this one. We are engaged on what is, in fact, a partnership and I think that partners must trust each other. I think that this is an essential prerequisite of success.
Having said all this, I want to repeat again what I have said twice earlier; it is that I welcome the Bill. I regard it as a genuine attempt to solve, once and for all, the land problem in this country. Frankly—and I am speaking frankly to noble Lords opposite—I think that the greatest danger to the success of this Bill is the uncertainty engendered by a belief that an early change of Government would result in its repeal for political rather than practical reasons. I am saying this to noble Lords opposite quite straightforwardly, because I was quite appalled that the noble Baroness, Lady Young, for whom I have the greatest respect, should again repeat the suggestion that if the Conservatives are returned to Office they will repeal the Act. Her noble friend Lord Gage pointed out that he thought that the Conservative Party erred in repealing the 1947 Act.
My Lords, given a reasonable chance to bring the full scheme into operation in the gradual way—and that is the important point—which is proposed by the Government, local authorities are ready to accept the undoubted challenge offered them with every hope of success. This is the third attempt since the war at the control of development land. The 1947 Act and the 1967 Act were both repealed before they could be tested. Land is one resource which cannot be increased. It must therefore be used with the greatest sense of social priority. This Bill, if given the chance, can achieve its objective. I appeal to your Lordships to make sure that it has that chance.
6.49 p.m.
Lord MIDDLETON: My Lords, if there is anything at all to be said for this Bill, it is that it makes an attempt to deal with two matters on which, as it seems to me sitting here listening to the debate, there is general agreement on all sides. First, the continuing need for land to be
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made available for development in the right place and at the right time; and, second, that making outrageous private profits from the disposal of such land is unacceptable. We have been given many reasons why this is the wrong way to deal with these basic problems, not the least interesting being those put forward by the right reverend Prelate as to why the Churches should not render unto Caesar. Even if it were the right way, the timing of this piece of legislation passes all comprehension.
Last Wednesday, the noble Lord, Lord Shepherd, gave your Lordships a very correct and realistic picture of the grave economic difficulties facing this country. We heard that the Chancellor of the Exchequer was trying to reduce public sector borrowing. The noble Baroness, Lady Young, reminded us that the Chancellor has identified the increase in wages and salaries in this sector as a prime cause of the rapid inflationary increase in borrowing. Yet today the Government are introducing a Bill, the cost of which is set out in its own Financial Memorandum. We have heard the figures several times today and I will not repeat them. All this expenditure is to be financed by borrowing, and the number of extra staff (including Inland Revenue staff) to implement the scheme is to be at something in the order of 14,000. We might be living in a different world from the one we looked at last Wednesday. Today the Government are introducing measures in direct conflict with the strategy of their Chancellor in his efforts to control inflation. If on Wednesday we saw the Jekyll face of this Government, today surely it is that of Hyde. This is a wrong Bill at the wrong time.
The declared purpose of this Bill is to attempt to solve the basic problems to which I have referred by what is claimed to be positive planning, and by taking land for development into public ownership and appropriating the profits on its disposal for what is vaguely called "the community". The true purpose lies deeper; that is, to alter the whole balance of ownership. It is nine years to 1984, but it is surely only a short step from saying that the development of land is required for the good of the community and therefore the community must own all land needed for development, to saying that food is required for the good of

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the community, and therefore the community must own all land needed for food production. The noble Baronesses Lady Young and Lady Hornsby-Smith, criticised the Bill, and I agree with them, on the grounds that since it is to a large extent a skeleton Bill on to which flesh will be added by Ministerial orders, it will be the authority for important minor legislation which will be introduced without sufficient consultation and without adequate scope and Parliamentary time for careful consideration.
The Bill gives unprecedented discretionary power to the Secretary of State. Regarding the restrictions of the right to a public inquiry, about which we heard several times today, it seems that the Government have had second thoughts about some of the more objectionable features of Clause 18 and Schedule 1 We will have to look carefully at the proposed Amendments. On these grounds alone, I join noble friends in objecting to the Bill. There is, in addition, a host of practical reasons that must occur to anyone who, like myself, is involved in local government. I speak with some feeling being chairman of a committee of my county council known as the Land and General Purposes Committee. I am going to have to implement this scheme if the Bill is enacted.
First, may I refer to the matter of public interest to which the noble Baroness, Lady Birk, referred. It was The Times that made the general point that a "local authority" is not synonymous with "the community". The community looks on local authorities with growing suspicion. The idea of local authorities stepping into the shoes of the profiteers will not be an appealing one. The ultimate purchaser is not going to get his house any cheaper by these measures. Indeed, he will have to pay more when the cost of a cumbrous bureaucratic procedure is added on. This is bound to worsen relations between local authorities and the public.
Secondly, I do not know about other parts of the country, but certainly in my own region I do not see owners of land queuing up to sell at existing use value. The land for development will not come forward, and we shall have to drag it all from unwilling owners by means of compulsory purchase orders with all the extra work that that will create. Thirdly, in a very interesting paper given recently,
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the chief executive of Suffolk County Council estimated that if one took the 12,000 figure given in the Bill for extra staff required by local authorities, then his county alone would require an additional complement of 50 qualified and part-qualified valuers; 15 planners; 25 solicitors and conveyancing staff and six treasurers. In addition, there would be 27 administrative and clerical support. That is an extra staff of 123. I suppose that at least half of them would have to be qualified professionals.
I do not yet know the recruitment requirements for my own county, but we should need something of this order, and would have to provide office space for them as well. I do not know where all these professionals are coming from. They are hard to find now, and all local authorities will be competing for a few trained people. Will they want to be recruited when the next Government may repeal the Act and they will be out of a job? Fourthly, county councils, under Clause 19, will have to work out land acquisition and management schemes that will define the division of functions between county and districts. There are already enough areas for potential disagreement between counties and districts following local government reorganisation.
I can see endless possibilities of dispute over the financial aspects of land acquisition and disposal. In my own county, for instance, we have a large and important city, that can only expand into its neighbouring district and will not relish the idea of its neighbour reaping the benefit of the profits that we are told will accrue. However, it seems that many of the difficulties can be overcome by the operation of a joint land account; but, even so, you still have to get all your districts to agree to such a policy. I know my own county is going to have an uphill job.
Fifthly, most councils are now at full stretch preparing their structure and local plans. That in itself is a stern task for an authority like mine that is well below strength in its planning department. To ask us and our districts to take on the role of monopoly developer must impose a great additional burden. The necessary skills are just not there at the moment, and I wonder whether they ever will be.
Sixthly, I join the noble Baronesses, Lady Young and Lady White, in seeing

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grave objections to local authorities exercising planning control and, at the same time, being developers. Will not proper consideration of plans on planning grounds go out of the window? Will we not, as planning authorities, be in danger of having our judgment clouded by the prospect of gain?
Seventhly, upon whose judgment of future development requirements are we as local authorities to build up our land banks? Our own? That of the Secretary of State? That of the Regional Economic Planning Council?
Some estimates of future needs can be wildly wide of the mark. I will spare your Lordships from the details of the curious story of the Humberside Feasibility Study suffice it to say that before even the Study was completed, the Registrar General's figures were updated and proved that the original population projection was hopelessly wrong, and this fantastic project finally received its coup de grace four years later. I believe the noble Lord, Lord Sandford, was in at the death.
What will happen in the future when some such planner's pipe-dream is pushed at a local authority and it is then told to build up the necessary reserves of land under the Community Land Act? What does it do with the land if and when the whole scheme is found to be futile? And what has happened in the meantime to the productive capacity of that land? This is an extreme case, but not only are many people in local government apprehensive about these proposals, there is also considerable anxiety in the agricultural industry, as the noble Lord, Lord Sandys, so ably pointed out. Much concern is felt about the possible blight of agricultural land near the larger towns and about the need to safeguard agricultural land from wastage in the case of purchases made far in advance of actual requirement.
We must welcome the concession made by the Minister when he said that Schedule 3 will be altered so that every authority shall have regard to the needs of agriculture and forestry. But this is an obvious duty. We must, in Committee, see that this is set out firmly enough. We are happier that the ten-year programmes are now reduced to five years, but there is also much anxiety about the
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loss of food production from the loss of precious acres—already running, as has been pointed out, at more than 75,000 a yeas—that may occur through the zeal of some authorities to be seen to be planning "positively". We shall certainly need to look very closely in Committee at the many sections of the Bill which may have a serious effect upon home food production.
Finally, we must in all fairness look at the other side of the balance sheet which is set out in this prospectus. A great deal has been made of the capital value of the disposals that will accrue to local authorities. The Financial Memorandum of the Bill puts them at £800 to £900 million annually. But any prediction about surpluses on local authorities' community land accounts must be highly speculative. Many local authorities are far from sanguine. Some highly urban areas appear to envisage no surplus for many years. Perhaps I can leave the last word to the county chief executive, to whose paper I have already referred. He said:
"If I am right in my assumption that landowners and local authorities may change place that is, the owners trying to prove that their land is not ripe for development and planning authorities demonstrating that it is, then it may be a long time before ire sit down together discussing what to do with the profits."
7.3 p.m.
Baroness STEWART of ALVECHURCH: My Lords, I have listened with great interest to this debate and to the conflicting views put forward. I still believe that the Bill is one of the most important of our time, both in its range and its humanity. Unlike my noble friend Lord Pitt, I am afraid I have no inside knowledge of local government, though I have considerable knowledge of the social services. It is from that angle that I should like momentarily to consider the Bill.
The Bill recognises the increasing complexity of man's social needs, and in this context the Government are, of course, concerned not only with the needs of the few but with those of all the members of the community. The provision of these needs depends upon the availability of development land and, to some extent, on the transfer of the unearned gains from that land, from the landlord to the community. I do not know how far Inner London can benefit from this Bill because

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of the fact that part of it, at any rate, is so overcrowded and built up, but undoubtedly areas with a growing population should greatly benefit from this. Many towns today, owing to the lack of development land, have been unable to provide what we have now come to consider essential services in central positions where they are most needed. Among these services are luncheon clubs, community centres and many other facilities for elderly people, to which reference has already been made. Today, these are not luxuries but essentials in the modern world for many people if those people are to remain active and in touch with those around them. Of course, development in central positions is essential for nearly all our social services such as housing, education, hospitals and so on.
Reference has already been made to possible problems over staffing in local authorities. It seems to me that if it is going to be difficult to find new staff, local authorities should be permitted to share. I would hope that is something which might he considered by my noble friend. I have been told there is likely to be a shortage of valuers in Central London, and there is also a possibility that not enough men and women are being produced in that profession. That again, is a matter which should 2oncern us.
Another problem has also been referred to: that is, planning blight. That, I know, is of great concern to my noble friend. It is not a new problem: it is as old as democracy itself. Consultation at every level necessitates delay, and the wider the consultation the longer the delay. In human terms, as we all know, that may mean that the roof of a house may leak for many months, and sometimes years, if poor people live there and they cannot persuade their landlords or a local authority to mend it because it is possible, though not certain, that the house will be pulled down to make way for redevelopment. Such a situation arises on many occasions, as we all know, and we must consider ways of reducing the timetables.
One matter which I hope my noble friend might consider concerns ways of shortening the lines of communication between local authorities and the Ministers concerned. Perhaps in other cor
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respondence it might be possible to eliminate some of the steps in the communication ladder because, certainly when I have been associated with official bodies, the delays have nearly always arisen out of delays in correspondence—letters have to be passed from A to 8 and then to C, and then they come back again some six months later. Finally, may I say again that I think this Bill is of great importance and that it will greatly widen the opportunities of local authorities to serve the general public. Many of those who have had doubts, and still have grave doubts about the Bill today, will I believe, in a few years' time come to appreciate its merits. I hope that may eventually include the noble Baroness, Lady Young.
7.10 p.m.
Viscount RIDLEY: My Lords, I think it is a bad thing that this House should have to deal with what The Times last week called, "Mr. Crosland's redundant extravagance "at this time of the year. It is bad because it is a massive piece of legislation fitted into a very crowded Session of a very revolutionary kind. Secondly, it is bad because I cannot see that it can produce any more or any cheaper houses as a result of its enactment. Over the years land has always been a very good and worth while investment to hold, and perhaps this was because, as I believe one of the earlier Rothschilds advised some Royal personage very many years ago:
"God is not making any more of it now".
It comes perhaps as some surprise to my noble friends on this side of the House that I would agree with quite a number of the aims of this Bill as set out before us. There is some merit in what it tries to do, particularly the most important aim which is to secure for the community the benefits of development values which have arisen as a result of the community's actions. We do not try to specify what "the community" means in this context. I suspect that it really means the Government, which is quite another thing. In principle, there is much to be said for this argument. Indeed it must be right. But, of course, the same argument could be applied to works of art, diamonds, or almost any other scarce goods, which could similarly be nationalised on the same grounds. After all, Rembrandt is not painting any

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more, any more than God is making any more land, and we could nationalise Rembrandts under this legislation if we wished.
There is supposed to have been a great deal of speculation in land recently. This is commonly said by noble Lords on the other side. The thought is that local authorities should get in on this speculation and make themselves some profits. It was supposed that people who were making vast profits out of buying or selling land were not entitled to do so. It never seems to have been remembered that the profits that were made were very heavily taxed this has always been ignored in Labour circles. The taxation which was raised has already passed to the community. Surely, it would be possible to achieve the agreed aims of I this Bill by higher taxation imposed under any Finance Act; and this could be none. It would be the least complicated method of achieving this purpose and it would, perhaps most importantly, have the support of all Parties, because the Conservative Party indeed raised such a tax at the end of its term in Office. When it inevitably returns to Office it will repeal this Bill and the situation will be considerably confused as a result. Would it not be better if we could get some agreed method of dealing with this subject, rather than this constant pingpong game of repealing Acts and trying to get through new taxation?
I accept that the previous Conservative Government could, and should, during the course of their lifetime have brought in such taxation against land profits much sooner than they did. This is, of course, easy to say with the advantages of hindsight. It is important that they did so at all, and it is right that they did so. If we could only get an agreed policy whereby the community benefits, and whereby local authorities can acquire such land as they need without having to pay exorbitant prices, we should be in a much happier situation. From what I have heard, this would seem to me to be better achieved by the Bill which we are not to get this Session—the Development Land Tax Bill—which looks to me as if it would be a much more important Bill to have now than the one before us.
A percentage of the profits created by sales of land should be left to the land
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owner. This is the inducement to sell which so many other noble Lords have spoken about this afternoon. Without such inducement, land supplies will inevitably become extremely scarce. I do not think the Government need worry about leaving some small percentage of any profits with the landowner. After all, they will soon be gobbled up by capital transfer tax, wealth tax, capital gains tax, value-added tax or any other tax one cares to mention, and they will all fall into the lap of the community before too long. So again, we conic back to the absolutely unnecessary character of this Bill.
There are many other unpleasant aspects of this Bill to which I would refer. I hope that many of these will receive close Amendments during the Committee stage. It seems to be a common feeling in Labour circles, and certainly I think it is in the mind of the Minister, that local authorities should welcome this Bill as it gives them a source of finance. I suspect that this view is shared by only those authorities who are devoted fanatically to the Labour cause, where anything in the nature of nationalisation is an act of faith for them. A more sober appraisal of this situation would make it quite clear that there are no great profits to be won and there are not even going to be anything but minutely adverse effects on local authority finances, at least in the short term.
The noble Baroness, Lady Birk, in her excellent opening speech said that this Bill would have no effect on the rates. I look forward to seeing her eat those words in two or three years' time. I hope I am spared to see it, because I am quite certain—and I can speak with considerable local authority experience—that there is no land for building likely to be acquired in many areas in this country for several years to come. It already has planning permission or is in the hands of builders, and is thus exempt. Meanwhile, we have to set up a vast apparatus of bureaucrats who will need to be dealing with this land acquisition and this in itself will be expensive. Other noble Lords have referred to this, so I will not dwell upon the point. But certainly there will not be any bonanza whatever for local authorities under this Bill.
Moreover, as drafted, this Bill quite definitely can be said to be designed to aggravate the difficult relationships which

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now exist between county and district councils in the field of planning. I believe it is in this field, or mainly in this field, where divided responsibility was created quite unnecessarily by the Local Government Act 1972, that we have many problems to solve. There are quite unnecessary levels of staffing and quite unnecessary tensions between the two types of authority. Your Lordships will remember that we debated this matter in an equally hot August three years ago, and possibly we did not get the right answer then, either. These relationships are not easy. Perhaps it was a mistake ever to have thought they would be so. I agree with my noble friend Lord Gage who said that this land acquisition problem will create yet further problems in a difficult situation.
There may be many things we do not know about because this Bill seems to have arrived here in a half-way stage, as we know, and many Amendments may have been made with which we are not yet familiar. So I must apologise if I mention one or two detailed matters which have already been dealt with properly by the other place. But there are one or two matters I should like to speak about from the point of view of local authorities. First, I was going to mention the question of Wales, which is a dangerous thing for someone who is 100 per cent. English to do. I am glad that the noble Baroness, Lady White, who is very expert on this subject, was able to ask many of the questions which have been asked, and I hope she will pursue her objections on behalf of Wales. I do know that the Welsh county councils are extremely distressed because they do not have the powers the English county councils have under this Bill. I expect noble Lords to turn up in force at the Committee stage to see what they can get. Furthermore, it surely must be wrong in this day and age to create yet another non-elected authority—the Land Authority for Wales another body interposed in this complicated planning field between district, county and Central Government, so that there is a fourth authority with no electoral background, which is bound to make the situation in Wales difficult. I remain pleased to be 100 per cent. English at this point.
The next thing we must be careful about, although it has been considerably
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improved, is the question of compulsory purchase. I am not a lawyer. I would not wish to become involved in the detail of this. The fact that the Bill as first set out, when it first saw the light of day, had so many terrible things to say about compulsory purchase, is not the Government's credit. A great deal of what they suggested has gone—I do not now know how much. There is a hit left to go. But it will not be acceptable to destroy the compulsory purchase safeguards on which this democracy depends. Most people have a healthy distrust of authority and bureaucracy. Very often only the compulsory purchase regulations stand between ordinary people and unfair, undemocratic local authorities or Government. The compulsory purchase procedure is complicated and tedious, as those of us who have tried to operate it know. But it is right that it should be so tedious, and right that it should be as democratic as it is and that everybody should have an opportunity to believe with complete confidence in the carefully constructed safeguards we have erected. I am sorry that this Government have seen fit to chew away at this aspect. There is still the power of the Secretary of State to disregard objections to a compulsory purchase order on the grounds that the acquisition is unnecessary or inexpedient. I believe that this is unsatisfactory and I trust that we shall be able to do something about it.
There are two other matters to which I should like to draw your Lordships' attention. It is of course absolutely right that the local authorities should acquire such land as is essential to do its job—for example, for school sites roads, et cetera—as cheaply as possible to the community—at existing use value if it can be done. This must be acceptable to all of us, particularly when we pay our rate bills. But the fact that the new Bill provides that off-site infrastructure costs of an authority will not be allowed as a setoff in the community land account does not help this business of development and might quite certainly be a very severe burden on local authorities.
I am sure that we all wish to ensure that local authorities do not pay inflated development prices for such things as they have to have. There are much simpler ways to achieve this result—in particular, by Section 52 of the Town and Country

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Planning Act 1971 which, as your Lordships no doubt are well aware, enables agreements to be made for contributions from developers. If this clause had been less voluntary and more compulsory and amended in ways which it is not my purpose to go into in detail tonight, we could have solved all the problems in this field and the primary purpose of this Bill would have fallen to the ground.
There is another matter concerning finance which gives grave cause for concern to local authorities. It relates to the question of disposals which has already been mentioned. In future, existing holdings by local authorities will not be permitted to be sold without the approval of the Secretary of State. Indeed, I understand that the freehold of such land can never be sold. Under comprehensive area development area powers local authorities have been purchasing land, servicing it and selling the freehold to industrialists or to other developers in a new town type of situation. In particular I would mention the Town Development Act powers for dealing with overspill. The proceeds of these sales have been put towards the creation of further infrastructure and services, or the purchase of further land for this purpose. My own authority of Northumberland has by this means created a new town with a population of nearly 25,000 which is expected to double in the next 15 years, with nearly 10,000 new jobs in new factories. This has been carried out under the comprehensive development area legislation, and it is the positive planning which has been referred to so often. It shows that it can be done without the necessity for this Bill and that it has been successfully done.
As I have mentioned, Section 52 of the 1971 Act may need to be strengthened. I understand that if this Bill went through unamended the whole of this type of development could become completely redundant and virtually crippled; 70 per cent. of the surplus of the community land account will be taken away by the Government in one form or another. This would be a complete destruction of the type of development which I have mentioned. It is worrying a great many authorities in the North of England at least, and I hope that in due course this matter can be given our very serious consideration. It has been amply proved that
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where land is sold for new factories—which is, I am sure, a laudable purpose for local authorities—industrialists wish to own the freehold of their factories and thus protect themselves against the uncertainties of rental revisions as well as inflation. It is important to them that they should be able to own the land. If they are not able to do so, I suggest that they will not come to the development areas but will go to other parts of the European Economic Community. Therefore, this is a matter which worries me very much indeed.
I apologise for speaking for so long on this Bill which has detained us in a most valuable debate. I hope I have mentioned some of the points which make it repellant to many on this side of the House and, indeed, unnecessary. We are forced to the conclusion that the Government, which have rejected the advice of the numerous bodies which the noble Baroness, Lady Young, mentioned in her admirable speech, will go ahead with this Bill. It looks as though we could have dealt with the matter in some other way which would have received all-Party support and I hope that one day we can. Also, it looks as though this Government are bent on land nationalisation through what appears to be a particularly unsavoury back door.
Finally, throughout this debate there have been references to corruption in local government. Living and working as I do in local government in the North-East, I suppose I may be regarded by some as an expert on this subject. I have, to say the least, an unenviable reputation, but I will confine myself to saying that I think it is true that if Mr. Poulson and his like had been around at this moment they would have welcomed this Bill with open arms.
7.24 p.m.
Lord HENLEY: My Lords, that is a most interesting observation. Perhaps the noble Lord will send a copy of Hansard to Mr. Poulson to study. I think it was Mark Twain who made the classic remark about land not making any more land and not, as the noble Viscount mentioned, Lord Rothschild quoting God.
My Lords, the noble Viscount, Lord Ridley, is a very great expert on local authority affairs in the North-East. When

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the noble Lord, Lord Pitt of Hampstead, was making so powerful a case for London, I felt that the same argument simply would not apply in Northumberland where the noble Viscount comes from; probably the same applies also to what the noble Lord, Lord Middleton, might say and feel about Yorkshire.
I believe that the first aim of the Government in this Bill is to try to make planning more positive. They feel that under our planning arrangements the initiative is not with the local authority. Rather than respond negatively, they feel that this Bill will give them something which will enable them to plan, as they have put it, positively. However, I wonder whether or not there is a more insidious danger in this Bill towards planning than the Government are aware of. The planning system of this country is a very sophisticated one, and it has been extremely successful over the land use and control which we have had for 25 years. After all, it was the previous Labour Government who gave it to us in 1947 and, as my noble friend Lord Foot said, it is now the accepted way of life. The basis of that system was that land use decisions were taken on their planning merits alone and on no other.
The trouble about this Bill is that it makes it inevitable that quite other considerations will come into play when planning decisions are taken. In that respect I welcome the redrawing of Clause 17 to have regard to the development plan—as the noble Baroness, Lady Birk, said to make it "planning orientated". I am astounded that it should have been necessary to do this. It seems extraordinary that a Bill which is meant to make planning more positive should have had this particular clause drawn up in such a way as to leave planning out of it altogether. However, it still does not meet the very grave concern that in exercising their planning functions local authorities will have to consider quite different criteria. Indeed, an example of that is that they will have to have regard to agriculture. Of course, I welcome that they will have to have regard to agriculture, and I agree with the noble Lord, Lord Middleton, that this should go without saying. Nevertheless, I view this with sonic cynicism. Is it not perhaps indicative of the fact that things other than planning are still going to take precedence?
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The Bill confuses the role of planning authorities by making them developers as well as planners. We have heard a great deal of comment about this from both sides of the House. I thought that the suggestion of the noble Baroness, Lady White, regarding the analogy of the noble Baroness, Lady Birk, between planning and ownership was not a very happy one. It seems to me that the effect of doing this is highly undesirable. On the one hand, the planning authorities have a duty to plan. At the same time, we are now requiring them to become dealers in land. In the past, the virtue of our system—I do not altogether accept the fact that it has been negative—has been our ability to control development. This has been the envy of many other countries. Now we are making local authorities themselves the developers. I see grave difficulties in this. Are we going to be able to go on controlling developers if, in fact, the controllers are the developers themselves?
I was interested in what the noble Baroness, Lady White, said about Wales. I like the Welsh idea. I disagree on this point with the noble Viscount, Lord Ridley. I believe that possibly some kind of regional control may be the best solution. Before we have any regional system in England could we not have some kind of regional overseer? I know that the Government are afraid of the idea of central national bodies because two of them have failed. That is partly the reason why they have put it down to council level. I wonder whether they are right. I think the impact of the kind of decisions that might be made by developer-planners is going to be most unfortunate. I can see very unfortunate things happening to Green Belts, conservation areas, National Parks, areas of outstanding natural beauty and to rural England itself. I think there will be too strong a temptation for local authorities to strength their finances by making planning decisions which are perhaps short-term expedients and not in the best interests.
The alternative that I see is to take the profit away from the local authority altogether. Here I disagree very strongly with the noble Lord, Lord Pitt, who sees this as a new source of local authority finance. I know that local authorities' finances are in difficulties, but there are

1407
many ways in which these could be put right. The last way in which I should like to see them put right is by allowing them to have the spoils from their own development commissions to themselves. I should like to get over this by making sure that all the surplus was returned to the Exchequer. I see no reason why the Exchequer should not funnel this back to local authorities. I think that is perfectly all right, but I should not be happy to see it funnelled back to the authority which had generated this particular surplus. Another alternative, which I think, was suggested by the Town and Country Planning Association, is that it should go into some fund for betterment, to be used specifically to try to make good the damage which development must inevitably do. So much for the actual business of the conflict between planning and the profits of development.
May I now say a word or two about acquisition? It seems to me that here is another danger, that the process of acquisition is being removed from the normal planning procedure. In a compulsory purchase situation, the Secretary of State is expressly empowered to ignore objections made on the grounds that acquisition is unnecessary or inexpedient. This is still in the Bill—at least I see no signs in the list of proposed Amendments of it being removed. This is very worrying to environmental organisations. The process is no longer restricted to purposes within the authorities' constitutional powers, and the Secretary of State can effectively disallow grounds on which compulsory purchase is open to challenge. So far as I can understand it, there is no sign in the proposed Government Amendments that that has been altered.
The same applies to inquiries. I am very pleased to see that the circumstances in which an inquiry can take place has been clarified so that we know more or less where we are, but there is a loophole by which I think an inquiry could unreasonably be refused. The three new suggestions—I do not know how many noble Lords have seen these—for grounds on which an inquiry could be dispensed with are: first, that it accords with the development plan—that is fair enough; secondly, that it accords with the local plan—I think that is all right; thirdly,
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that it accords with the structure plan. All these have to satisfy the condition that in the opinion of the Secretary of State there has been adequate public participation. That is all very well, but, as was said before, in the case of structure plans—which after all is something drawn with a very broad brush—an individual cannot tell what the position is with regard to any particular piece of land.
I am not arguing the case for owners—many noble Lords can do that better than I. I am arguing the case on the grounds that third parties—that is to say amenity organisations—can often get in and have a say only when there is the possibility of an inquiry. I notice that the noble Lord is trying to find information on the question as to whether or not there is going to be any change in the matter of acquisition—but he shakes his head.
Lord MELCHETT: My Lords, I was trying to indicate that I was not seeking information on that point; not that there was not going to be any.
Lord HENLEY: My Lords, the last point on which I wish to speak is the land purchase programmes. Some organisations, such as the Town and Country Planning Association and various local authorities, have asked the Government to publish their land purchase programmes, and I believe that the Government are going some way to putting land acquisition into a planning context. If they are, could they not go so far as to make sure that all these purchase programmes are on publicly available maps. This seems to me to be a perfectly reasonable request.
I have tried to look at it from the point of view of the effect on our existing planning system—which seems to me to be an admirable one, in spite of the fact that it is suggested it is not quite positive enough—and the damage we might be doing unaware, to a planning system which is the envy of the world, and, on the other hand, to the damage which also might be done by allowing local authorities themselves to be the developers and the planning permission givers. I shall be watching very closely at the Committee stage to try to make sure that some of the promises that the Government have made are met and that

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answers are given to the questions I have posed in regard to planning and conflict between planning and development.
7.38 p.m.
Baroness VICKERS: My Lords, I should like to open my remarks with a quotation from Professor Denman. He said:
"Whoever drafted this Bill has read the textbooks of Labour's past failure at land policy and has repeated the mistakes with great diligence and a wanton disregard for the warnings of history."
Perhaps I should own an interest, because I own about 2½ acres of land, and I understand that under this Bill anybody who has more than quarter of an acre of land might be in danger of the "disposal notification areas". The noble Lord, Lord Brockway—I regret that he is not here—spoke vehemently against people owning any land. It might interest him to know—I believe he has been to China—that in that Communist country one of the things now allowed in communes—to the leading people on the commune—is the ownership of a personal plot of land and they have found that communes have worked much better since.
It may be of interest to the House to know that I had the honour of being mentioned in the Crossman Diaries. I should like to quote his remarks in regard to the Land Commission Act 1967. He wrote:
"I am gradually beginning to twig a little tiny bit from a general practical point of view, but for most of the colleagues around this table this is a subject completely beyond comprehension."
I am not suggesting that it is completely beyond the comprehension of Members of your Lordships' House, but the way the Bill is drawn up shows that there was some difficulty in achieving comprehension as to what they really intended. I have been interested in local government, having been a member of the London County Council for nine years and on the Housing and Town and Country Planning Committees. I think that the present system—as was mentioned by the noble Baroness, Lady Hornsby-Smith—which enables builders to search out land for themselves and appeal to the Secretary of State if the council refuses
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is a much better and simpler method than that suggested today.
Some Members in the House may remember the late Arthur Skeffington, MP who issued an excellent document called Consulting the People. Unfortunately, this was never put into practice because he started very well, getting together the people who owned land and the local council to discuss this. The document was well illustrated, and people were beginning to understand (which they are not going to understand at the moment) what was happening to them in their local community. As I understand it, development land is land which, in the opinion of the authority concerned, is suitable for relevant development. I am sorry to see that the noble Lord, Lord Middleton, and the noble Viscount, Lord Ridley, have left the Chamber because having recently fought the Local Government Bill in another place—the 1972 Local Government Act—I can foresee great difficulties in a county like Devon, which of course fought as hard as they could against the Bill and are now just beginning to build up their organisation. I am afraid this new Bill will create more disputes as to what is and what is not relevant, particularly having regard to the fact that district councils are housing authorities and they will want the land in the bigger towns for development whereas the agricultural people will want it for themselves.
Also there is the possibility of a third party applying for planning permission to develop even though he does not possess the material interest in the land. Up to date, I gather that there have been safeguards for the owners in that they have been notified and can refuse to sell. But under this Bill this is changed, as I understand the position. An application by a third party for planning permission would be sufficient to enable a local authority to start proceedings. Quite apart from the injustice to owners, this could lead to a great deal of malpractice.
In another place, the Minister said that he was putting his trust in local authorities. Therefore, I turn to Clause 50, dealing with the powers of the Secretary of State. That says:
"The Secretary of State may act under this section in a case where it appears to him

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expedient that an authority should cease to be responsible for exercising—

(a)any functions under this Act, or

(b)any functions under any other Act, whether passed before this Act "—

that is, retrospective legislation—
"or later, being functions concerning the disposal or management of land."
It goes on to make it even stronger:
"(2) In such a case the Secretary of State may make an order transferring any such functions

(a)to himself, or

(b)to another authority, or

(c)to a body appointed under Section 52 below."

If you turn to Clause 52, it deals with bodies to exercise reserve powers. The Secretary of State may set up a committee and may make an order in regard to the membership and chairing of the body, for regulating the appointment and tenure of office, and it even goes down to remuneration, pensions, gratuities and allowances for the officers and servants. Surely that is not putting much trust in the local authorities' and therefore I believe one should look again at this clause.
I have recently returned to live in Wiltshire and therefore take an interest in agriculture. From my discussion with local farmers, I find there is enormous uncertainty in the farming community. I believe it will now be five years and not ten. But, as was quoted from Mr. Ernest Richards, the Chairman of the National Farmers' Union Parliamentary Committee, if the five years' rolling programme is put into operation it will mean land acquisition on a massive scale with all the attendant uncertainties, anxiety and stress for the people most concerned, the farmers. I thought that at the present time we were keen to get as much agriculture as possible, and thus provide ourselves with as much food as we could in order to save our currency.
I should like to end by mentioning one other point that is, the basis for compensation in the case of dispossession of farm workers. I do not think this has been mentioned before, but as I understand it the Government gave an undertaking in the White Paper, Land, to consider whether the new "current use value" compensation will be sufficient in the case of dispossession of working farmers. I think this is a vital issue and
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I should like to know whether a farmer who loses all or part of his farm will be guaranteed that the compensation provisions in the Bill will put him in the same—and I emphasise "the same"—financial position as before. I know that the National Farmers' Union—and I used to attend the Devon County National Farmers' Union meetings—has consistently fought for the acceptance of the principle of equivalent reinstatement. As I understand it, this means that a farmer who is compulsorily dispossessed of his land should be in no worse position after he has lost his land than before. The current Compensation Code, although recently amended in the Land Compensation Act 1973, does not allow for the financial or physical reinstatement of the dispossessed farmer. Thus a farmer who is dispossessed within a development area and compensated at the current agricultural value within that area, I suggest, would be in no position to reinstate himself on a similar holding elsewhere.
Finally, I should like to turn to a point made by the noble Baroness, Lady Hornsby-Smith, in regard to compulsory purchase orders. In regard to Schedule 4 paragraph 3(5)(b) I should like to ask the Minister whether these provisions might be a breach of Article 17 of the Universal Declaration of Human Rights, and add also Article 1 of the First Protocol of the European Convention on Human Rights?
7.46 p.m.
Lord CASTLE: My Lords, as I join with previous speakers in congratulating the opener of this debate on a remarkably clear exposition of the impact of this Bill and its intentions, I should like to draw attention to the fact that a possible result of our discussions last week on the Sex Discrimination Bill has been that this afternoon five out of the first nine speakers were members of the gentler sex—if that perhaps is not a misnomer for some of the contributions, which were notable for their vehemence if not violence, which of course I shall not follow this evening.
My Lords, I have been waiting a long time to make this speech—not just since half-past three this afternoon, but for the last sixty-five years. That may surprise some noble Lords, but then my naturally youthful air is somewhat deceptive. I claim that I was baptised in land reform

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at the age of 3. I was taken to a great Liberal rally in the Election of 1910, and there the expectant Liberals, waiting for the new dawn of radicalism—and this is my first memory, authenticated by my parents who took me—sang the "Land Song":
"The land, the land, the people have got the land.
Why should we be beggar; with the ballot in our hand?
God made the land for the people."
They do not sing that song any more in Liberal circles.
I thought I detected a split in that Party this afternoon. There was the wholehearted support given in a notable speech by the noble Lord, Lord Foot, which we all appreciate and welcome, and a much more hesitant—shall I say diffident?—reception from the noble Lord, Lord Henley. All I can assure them is that the torch that the Liberal Party allowed to gutter out all those years ago was picked up and relit by the Labour Party, and I am proud that they did it. As has been pointed out, we have shown our resolution in these matters by introducing three Bills. The two previous ones had to be abandoned because of—shall I say?—administrative deficiencies or inadequacies. But we are not afraid to learn, and the Government have now shown that they have learned lessons from the two previous attempts. They have abandoned the bureaucratic idea which fills so many people opposite with dread, and have wisely, to my mind, assigned to the local authorities a great task—perhaps their biggest task—of social and economic rectification.
The Government could not have done better. Among the people who never soiled their hands in local democracy, never perhaps risked their reputations in grass root democracy, it has been thought clever to deride the work of the butcher, the baker and the motorcar maker who plan our roads, schools and social equipment at local level. As we know, many of them are people who are responsible for the majority of the homes in their area, and for the services that are enjoyed by the people of that area.
I was aghast this afternoon—and I think my astonishment, surprise and shock are shared by my companions on this side—at the attitude of the noble
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Baroness, Lady Young, who is famous, and deserves to be, for her interest in local government. But to say what she said in contemplation of corruption in local government under this scheme was unworthy of her. The noble Baroness must have worked in different local government from myself. She must have been associated with a different Party from that with which I have been associated. Much publicity has been given to the few—and quite rightly so; I want publicity given to those who are backsliders. But from my experience, the great mass of men and women of all Parties engaged in local government are seagreen incorruptibles, dedicated to the wellbeing of the community around them. Despite the catalogue of interested parties who at this stage find it convenient to oppose the Bill in some of its detail, the fact remains that the majority of local councillors welcome the Bill, for they, better than anyone else, know the price that has to be paid by the community to regain the wealth which it produces. I speak with pride as one of a collection of local government men.
My Lords, this Bill is not merely welcomed by individuals in local government, but also by representative bodies, although one would not have thought so to hear some of the comments made from the other side of the House today. The Bill is particularly welcomed by the AMA. The "A" does not stand for anarchist, and the "M" does not stand for Marxist, although you may have thought that that idea imbued some of the speeches we have heard. Those initials stand for the Association of Metropolitan Authorities, the most powerful body speaking for local government in this country. In a 6,000-word memorandum of explanation and welcome the AMA says—and the noble Baroness could not have put it better:
"The build-up of values which has been a feature of recent years has created quite severe problems for the local authority, which would have had much greater freedom to set the objectives and the plan of development by purchasing at current use values and by being the agency for establishing the general shape and aims of the development with the real needs and benefits of the area rather than that land profits is the sole aim."
That is what the major local authority organisation in this country has said. Of course, as has been underlined, there has not been praise all the way. The

1415
handmaiden of the Tory Party in Fleet Street, the Daily—
The Earl of ONSLOW: Mirror.
Lord CASTLE:—the Daily Whatsit, talked about it as the "land grab". Of course it is nothing of the kind. If anything, it is a land grope, a very tentative approach to a continuing problem. In fact the Government have shown extraordinary sensitivity for the tender purses of developers. There is the very sensible proposal that where the private developer applies for planning permission, the council, at least in the first few years of the operation of this Act, will buy at market price the land for which the planning consent has been granted. With the developer they agree a leasehold rent on a long lease, and perhaps a share in the equity. This is the proposal which has received root and branch condemnation opposite. Yet it suggests a satisfied customer and a satisfied community, with no obstacles to wise, far-sighted investment for property developers, no hindrance to initiative, but merely a mild assertion of the public right to share the wealth that community effort has created.
This arrangement applies also to planning applications for change of user, which is a matter of great importance to large cities like London. We have no green fields where permission to change from pasture to building site, from cowslip meadow to Klondyke Close, has given many a farmer a harvest of gold where he would have sold rye. We have not got that problem. In London we know a lot about giving planning permission for the four walls of a jam factory so that it can become the outer shell of a block of offices, and in the process the value increases tenfold. In my own area, the borough bought a shirt factory and transformed the inside at comparatively little expense, with partitions and so on, into the planning department headquarters. The price per foot rose from £1·5 to £5 in the market. This sort of thing is being repeated daily all over the Metropolis, and over every conurbation. We all know that empty plots of land inside a town are of no value in themselves, but with planning permission they are worth the weight of the topsoil in gold.
However, the new legislation gives the consolation that it will be the community
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which takes its share of the wealth that planning infers. I fear that the duties your Lordships have assigned to me in Europe may deprive me of the long, hard slog which is implicit in all the contributions which have been made today from the other side of the House. Frankly, this surprised me, because no Bill has been examined in greater detail in another place than this; they having spent 155 hours in minutely examining it in Committee. One would have hoped that out of those consultations between all the Parties we could have had something like an agreed Bill.
My Lords, I beg their Lordships opposite, and their misguided allies, if any, on the Cross-Benches, to recognise that the Government have opted for a mild reform—this is as I see it—rather than a revolution in land holding. More simple ways of tackling the land problem have been advanced. For instance, we could have served notice that all absolute freehold in land was to end and that, on the appointed day, all land should be leased in trust for the Crown; in other words, the community. That was more or less the feudal idea, and it had the merit of requiring service as payment for possession. At some time perhaps a commensense arrangement of that kind may win acceptance, but that day is not yet.
This Bill is in fact tailored to the concept of a mixed economy. There is nothing wrong with that, but that is where it should excite enthusiasm among all of us who want to make the mixed economy work. The arrangement between public ownership of the land and a private developer is not new in municipal politics. It has worked remarkably well, for instance, in the creation of some new town centres. The noble Lord, Lord Clitheroe, and my noble friend Lord Rhodes, share with me knowledge, and perhaps real joy, at what a partnership between a private developer and a municipality has done for once dilapidated Blackburn, a town which I know very well, and with which some of your Lordships have no acquaintance at all.
I would wish that this had been a consensus Bill. From today's debate, there seems no hope of achieving that. But it would be imprudent, even dangerous, for noble Lords opposite to accept leadership from the more reactionary of their colleagues in unduly obstructing this Bill.

1417
By so doing they will appear in the eyes of many moderates—if that is not a derogatory term these days—to be condoning the offences of the land racketeers; of the greedy men who have been able to hold the community to ransom when it asked to turn a swampy field into a car park, or to use a piece of infertile heath as the site for a house for old people. We all know that that kind of thing has happened, and it will be to our shame if we do not prevent it happening ever again.
This Bill gives us a chance to renounce the kind of arrangement which has existed up until now. There is no need for me to labour the arguments for action to end the shame. Despite their flamboyant defiance advanced this afternoon, noble Lords opposite know very well the evil. That has to be remembered! You are aware, my Lords, that what has happened argues that your Lordships should accept this Bill as perhaps the last chance to achieve by evolutionary means, consultation, over the next ten years an end to the injustices which have so long been associated with land tenure.
8.3 p.m.
The Earl of KINNOULL: My Lords, as the twenty-first speaker in a long and, in view of the weather outside, not so heated debate, I rise not to speak at length, as I intend to reserve most of my remarks for the proper Second Reading of a legitimate Bill when it reaches us. I share not the view of the noble Lord, Lord Foot, who seems to dismiss as being fuddy-duddy my noble friend Lady Young's protestations on the charade of the proceedings today. I take the view that on a blazing hot summer afternoon, as it was, on 3rd August, when most Members should be with their families on holiday, the Government have arranged a long debate on an illegitimate Bill in what can only be described as a device to assist with a wholly and wildly overloaded Government programme Session.
The House ought in no way to agree to curtail or be bulldozed on the proceedings and stages of this Bill when it reaches us. The nationalisation Bill, as the noble Baroness, Lady Birk, said earlier, is undoubtedly one of the major social changes. I agree with her, but I do not agree with the Bill.
Baroness BIRK: Which Bill is the noble Earl discussing?
Several Noble Lords: This one!
Baroness BIRK: My Lords, I did not call it the nationalisation Bill; it is the Community Land (No. 2)
The Earl of KINNOULL: My Lords, I agree that it is very difficult to understand, but I am discussing a Bill which is in essence a land nationalisation Bill concerning urban development. The House has a particular duty as a revising Chamber to examine the Bill thoroughly when it comes. I well remember, as I am sure many do in this House, the proceedings on the Land Commission Bill when it passed thorough the House. On that occasion I remember my noble friend Lord Brooke of Cumnor led for the Opposition with great skill and moderation. Listening to my noble friend this afternoon I can see that we have an equally skilful successor.
That Bill, the Land Commission Bill, after a thorough consideration left this House with 146 Amendments, 96 per cent. of which were accepted in another place. That, I believe, was a tribute to this House. I feel, with others, that the proceedings on this Bill, when it comes, will need similar examination. I would join with my noble friend Lady Young in seeking an assurance tonight that in the autumn the Government will either give this Bill proper time through all its stages—and when I say "proper time" I mean with a proper time lapse between stages—or that they will postpone the Bill to next Session.
We have heard more than once that this Bill is the third attempt since the war—and the noble Lord, Lord Castle, says possibly the last attempt, and I do not agree with him—to nationalise land. The reasons for nationalisation given by the Labour Party since the war have shifted, but there remains the determination to thrust down the throat of the British people this obnoxious social policy. The present determination I believe in no way reflects a majority view, and indeed it is a minority Government which introduce it.
The old reason for land nationalisation was to stop the land speculators from making a fortune at the community expense. The Labour Party of course were not alone in thinking that, and it was left to a Conservative Administration

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to put the profitable land speculator out of business. This was done very effectively in December 1973 by the development gains tax, when the teeth of the land speculators were plucked out. Now in the White Paper called Land, published in September 1974 by the Government, we see that the reasons for nationalisation have changed. We see now that the apparent urgent need is for positive planning, and a key to this treasure chest is nationalisation. I believe that that argument must be the thinnest veil of disguise given this century by any Government to mask their political dogma.
I would make two brief points on the Bill this evening. The first is really a rhetorical question: how will the individual fare under this Bill? The noble Baroness, in her introduction to this Bill, said that under this Bill this afternoon no Minister or local authority would behave in an arbitrary fashion to an individual. Those I think were her words. That is a pleasant reassurance, but it is a reassurance which, as one studies the Bill, does not appear to be the theme which one picks out or indeed the meat of the Bill, but perhaps the noble Baroness was referring to certain Government Amendments which still have to be seen in the Bill in another place.
Consider the case of an individual with a property of over one-quarter of an acre of garden. Under Clause 4 the individual has no protection because he has a property of over one-quarter of an acre. Suppose his neighbour says to himself, "This man has too big a garden; I will apply for planning permission for half the garden," which he is perfectly entitled to do under planning legislation. Indeed, this is done, and all that happens is that the owner gets a notification. Who decides a planning application under the Bill? The answer is the local authority. Who will eventually buy the land if permission is given? The local authority. What right of appeal has that individual under the Bill? The planning laws under the Bill are being altered, and indeed the Minister may well suspend the right of appeal; he will have power to do so. Can the individual fight to resist the sale of this land? The answer is, Yes, but the local authority is to be given strengthened rights of compulsory purchase order.
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What compensation will the individual receive? As we all know by now, up to the Second Appointed Day the market value will be the basis of compensation. But what will the market value be? No one and no valuer can say because there will be no open market value, and only the district valuer will be purchasing. The best that the individual can hope for is to apply to the financial hardship tribunal. That, I submit, is the future that can face the individual under this Bill. The second point to which I wish to refer briefly concerns planning. I happen to be one, like the noble Lord, Lord Henley, who has a great respect for the system of planning that has evolved in this country. It is a system designed over the years to meet the special needs of our islands with their very high-density populations and the problems that go with it. It is a system admired and copied by many countries, but it is not perfect; it has certain defects, perhaps the worst being its slowness, but it is democratic, and that system is about to be tampered with and disturbed under this Bill.
The Minister and local authorities are being given what appear to be jackbooted powers. The future green belts and their protection seems to be in some doubt and even certain existing planning permissions can be suspended under the Bill's provisions. The planning system which is being handed over to local authorities, some of which have neither the experience nor the staff, represents a break which is far too abrupt; there should be a gradual takeover, if there is to be a takeover.
The policy of land nationalisation is a policy which the country has rejected twice before. It is a policy that has commanded in the past and I believe now commands little to no co-operation from either individuals or industry. Because of this and because of the lack of co-operation, I believe the policy and the Bill will be doomed, as others have proved. The introduction of this Bill at this stage, in the midst of an economic crisis, is yet another extra load of costs to be borne by central and local government, and one really wonders and ponders which priority comes first with this Government, political dogma or the country.
8.15 p.m.
The Earl of ONSLOW: My Lords, I must first declare an interest. I am a landowner and I live in the overcrowded part of the South-East of England. My grandfather sold a lot of land on the Guildford to Merrow Road and he invested the whole lot in Japanese war bonds in 1938, so we saw no benefit whatever from that money. The minutia of this Bill have been discussed and have been shown to be wanting by many of my noble friends. On the ticker tape this evening there is an announcement that the Government have underwritten the copy of the Magna Carta to go to the United States for £1,250,000. When the great-great-great-grandfather of my noble friend Lord Mowbray and Stour-ton forced King John to sign the Magna Carta he was not interested in individual liberties. He was saying to the King, "Take your horrible thieving hands off my property", and by pure accident that defence of property developed into English liberties.
Why was the Court of Star Chamber abolished? Because it allowed the King to take too much of people's property. Why was the King not given power to tax without the consent of the Commons? Because they did not want the King to get his hands on too much of people's property. Why was habeas corpus passed? So that people could not be imprisoned without due course and process of law, so that the King could not get his hands on too much of people's property. Therefore the foundation of English liberty is based on property—Proudhon said that all property was theft, but Proudhon was not a believer in liberty. In England we have had liberty without democracy from 1650 or 1688 to the beginning part of this century. One cannot have true and real democracy without individual liberty. Look at the number of countries that call themselves democracies and then look at the number of countries that really are democracies. England is a country in which democracy and freedom really mean something, and this is based on my noble friend Lord Mowbray and Stourton's great-great-great-grandfather saying to the King, "Take your thieving fingers off my property."
It can be said, and it has been said—and I said it when my Party were in Gov
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ernment—that there have been indecent profits made out of land. The noble Lord, Lord Pitt of Hampstead, and the noble Viscount, Lord Ridley, said it. But now the balance has gone too far the other way and I think it was summed up by the noble Lord, Lord Castle, who talked about the "seagreen incorruptible", and we know who that applied to. It applied to Robespierre, and Robespierre was a tyrant. This is what frightens me about this Bill; namely, that it goes to the fundamentals of our liberties and not just to the taxing of indecent profits.
8.18 p.m.
Viscount COLVILLE of CULROSS: My Lords, the noble Lord, Lord Castle, said that he wished we could have a consensus on this Bill. I am afraid that that is not to be so. The noble Lord need not think that he can frighten us by what he indicated might happen if there was no consensus. There are, in fact, a number of emotions that struggle with each other among those who sit on this side of the House, but the more I have read about this Bill and the more I have listened to people speaking about it, what has come to the forefront is an overwhelming feeling of incredulity. That is the feeling I get when I read some of the things that have been said by the supporters of this Bill in the Government in another place and some of the things that have been said in this House today.
A junior Minister in Standing Committee foretells the golden age. He foresees profits flooding in and local authorities and ratepayers gaining the benefit. I should like to examine this a little as we go on. I am bound to suggest that, if it is profits that are sought by the Government, the Treasury and local authorities, I should find it hard to devise a slower or more uncertain way to achieve them than by this Bill. If it is positive planning that is the object—and I tend to agree with my noble friend Lord Kinnoull that that is a fairly thin veil—a little explanation is necessary. After all, there have been powers of positive planning since the 1947 Act. There was the development plan system which was explicitly on the positive side of planning.
I am afraid that local government has not in all cases acquitted itself very well. It may very well be that in the City of

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Oxford all was exactly as it should be, but the worst case which I know of lay in the county outside where, to this day, in the old county of Oxfordshire, the current development plan was approved in 1955 and was based on survey material collected in 1948 and 1949. That is the current positive planning which has only been added to by certain informal and rather sketchy documents as time has gone by. If it is positive planning the Government are looking for, why is it that they will not wait for the structure plan system and the local plans, which they themselves introduced in 1968, to come to fruition? What is wrong with them? Are they condemned before being given a chance to work? No, my Lords, I do not believe that it is just positive planning; I feel that there is a little more doctrine in it than that.
I do not wish to denigrate local government. I believe it was the noble Lord, Lord Pitt, who said that we should not do so and I agree. But local government has not previously had much experience of some of the things that it will have to do under the Bill. Local authorities do not seem to have had very much experience of identifying land for development. The Department of the Environment has just finished a study of the release of land for, I believe, housing development in four selected areas in the South-East. I believe I am right in saying that less than half, in terms of planning permissions, was granted on land found and identified by the local authorities. More than half, therefore, came from the initiative of people who brought forward planning appeals against the wishes of the local authorities and were found on appeal to the Department to be right. This, in one of the areas of greatest pressure, does not fill me with inspiration that the local authorities will be quick to find land on which to develop.
One of the main difficulties from which local authorities suffer derives from the very characteristics which have been so heavily underwritten by Ministers in another place. They are of course perfectly true of characteristics of local authorities. We are told that they are elected; that they are democratic; that they are accountable to the electors and that they will not be re-elected if they act oppressively. What this means in practice is not
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quite what I feel everybody would hope for. The electors are very fond of the bit of Green Belt over which they look from their houses. They expect "planning", as they call it, to preserve their views, even if they live in a house which has recently been constructed in the view of somebody who lives a little further inland. They do not like that sort of planning and they say so loudly and at great length at the public inquiries which I attend.
There are other people who have a very strong interest in the status quo. There are traders in the existing shopping frontages. There are people with other business—hoteliers and so on—who do not wish to see their trade taken away and who will not thank a local authority which grants planning permission for a rival show which will detract from their profits. What is more natural than that? The instinct of local authorities always tends to be on the side of caution and safety; to do the known thing, the thing that is accepted and the thing they know will not raise hackles among those very people who have to elect them again.
Talking about the GLC, I remember what I believe to have been a perfectly genuine though, as it turned out, misguided, attempt at town centre redevelopment. I do not lay it at the door of the noble Lord, Lord Pitt. It was the previous Party, but I do not believe that it was any the less well intentioned. The scheme in question was the plan for Covent Garden which has now been completely overthrown but which was pursued with a great deal of earnestness and ingenuity by a local authority with, I imagine, more powers and more expertise in land acquisition than almost any other in the country. Yet it made mistakes.
Lord CASTLE: My Lords, is the noble Viscount not just proving that local authorities are sensitive to local public opinion?
Viscount COLVILLE of CULROSS: My Lords, I was not taking that point. It was the Department of the Environment which turned down the plan before the GLC had a chance to think about it again.
The next matter to which I should like to draw your Lordships' attention is this.

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We are told, under the Bill, that land will be brought forward. I wonder whether the major defect of the Bill is that noble Lords opposite and the Party that has introduced the legislation have simply taken leave of any attempt to think how human beings behave? Who are these starry-eyed people, these idyllic creatures, these selfless persons who are prepared to bring forward their land for development with absolutely no penny of profit for themselves? Human nature does not work like that. With a development land tax at 100 per cent. or compensation at current use value, there will be no incentive. One need not be a money-grubber, a greedy hoarder or a speculator to refuse to sell one's house or one's small shop where one is very happy to an entrepreneur who is assembling land for a central area redevelopment. A little bit of cash may help but, if there is no profit in it, people will be much more likely to stay where they are. If that is so, it will be over to the force of the law. There will be compulsory purchase orders based on structure plans, local plans, action area plans and all the paraphernalia of planning which we know about so well.
The noble Lord, Lord Pitt, should not think that the land in the centre of towns will come dirt cheap that way either, because current use value, with disturbance, injurious affection and other forms of compensation can, as he knows full well, come to a very substantial sum. It will not be cheap for local authorities to acquire such land.
Lord PITT of HAMPSTEAD: My Lords, the noble Viscount will, however, admit that, even though it may not be cheap, with the reduction in development land increase, which is what we have had in London, there will be a quite considerable reduction.
Viscount COLVILLE of CULROSS: My Lords, your Lordships will find that I shall come full circle to that point in a moment and that I shall ask some questions about it of the noble Lord, Lord Melchett. I agree with the noble Lord, Lord Pitt, that it is a very important point.
No wonder, with these sort of duties coming upon them, that the noble Baroness, Lady Stedman, said that Cambridgeshire would have to take on 70 new staff including some very highly skilled persons. My noble friend Lord
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Middleton from Yorkshire told us the same tale and we have heard the same thing from Northumberland. I am afraid that the noble Baroness, Lady Birk, who seems to think that the local authorities can do all this so much better than does the present system—and of course the local authorities have power to do it under the present system—but with no spur and no assistance from private enterprise, will find herself sadly disappointed when it comes to the point.
My Lords, let us take a few examples of this: first, the urban development involving the big house standing in a substantial garden—not just the right reverend Prelate's Victorian vicarage, because the same development takes place in non-church circles as well. If one looks at the returns sent in to the Department of the Environment under Circular 102, I think, of 1972, it will be possible to see how much of the development land relied upon by the Government and local authorities as being available forms redevelopment of residentially-zoned areas in towns. Who will bring forward his house and garden for redevelopment when he has no incentive? What order of priority will the local authority find for that sort of thing? It is a small, intricate job requiring individual attention, and not the broad sweep of local authority powers that some people think would be necessary for land assembly and redevelopment.
I can say this to the noble Baroness. She thought it was inconsistent to say that agricultural land would be threatened, yet there will not be land brought forward for development. I do not think it is inconsistent at all, and I shall tell the noble Baroness why. I have talked about urban redevelopment and the problems, costs and the amount of skilled personnel involved. The local authorities will find it much easier to go out scavenging into the country on the edge of their towns on to green field sites, on to agricultural land, where it is so simple. All they have to do is get the necessary planning consent and the necessary compulsory purchase powers. There are no people to be bought out, no compensation to speak of. That is why the two points about which she spoke are not inconsistent, but will, I am afraid, happen all too frequently, and to the detriment of the farmer.

1427
What about this problem of the industrialist? We have a long way to go into the mysteries of non-designated relevant development, and I am not going to bore your Lordships with it this evening. But the scheme under the Bill will not be encouraging for the industrialist seeking to expand on to his own land which he has bought for that purpose. I know that in these cases there may be an exemption from the duty to acquire, but under the scheme of the Bill every disincentive is put in that man's way. He can find out whether the local authority is to exercise its option of acquiring his land only by making a planning application. As I read the Bill, if he makes a planning application he gives the local authority an irrevocable right compulsorily to acquire his land, and it is the general policy of the Government that whereas housing land may be sold off freehold, commercial and industrial land will be leased out to those who want it. Of the leases from local authorities of which I know none of them is at a knock-down rent. All have rent reviews, and the net result of this in the end will be a more expensive set of overheads for the industrialist than if he had been allowed to build on his own freehold; and more overheads, and more expensive overheads are very often passed on in extra prices to those who buy the products.
I am afraid that this is after all a piece of Socialism. I am not sure why the noble Baroness, Lady Birk, was a little upset when my noble friend suggested that there was something to do with nationalisation in this. I thought that it was part of the creed of the Party opposite that there should be nationalisation, and I should not have thought that the noble Baroness would have waxed indignant when my noble friend suggested that this was to be the aim of the Bill.
There is one interesting point in the Consultation Document which accompanied the Bill in another place—and we have it here. In paragraph 16 we are told how all new development will take place upon land which has first passed through the hands of the local authority, except for the minor exemptions. Then there is one other exemption:
"Even where development on land owned by public authorities, for instance, on statutory
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undertakers' operational land, requires planning permission it would not be subject to this limitation—"
that is the necessity to go through the local authority—
"because ownership by the public body concerned would be sufficient to satisfy the condition concerning public ownership."
That is what the Bill is really about: it is the condition concerning public ownership, even if it is to be done through British Railways, or through the noble Baroness's British Waterways, or through any other nationalised industry or statutory undertaking. That is what the Bill is really all about.
There is one point that flows from this. In her opening speech the noble Baroness, Lady Birk, spoke of the myth of the attack on owner-ocupation, and later the noble Baroness, Lady White, mentioned this again, and she was reassured that we had all misunderstood what was in Clause 4; I hasten to say Clause 4 of this Bill, not of the Labour Party's basic constitution. I do not think that my noble friend Lady Young was solely concerned with Clause 4. None of us has so far been able to fathom the provisions of Clause 25 which relates to the disposal notification area procedure. I have read avidly what the right honourable gentleman the Minister said about this in another place. I believe that we shall have to come back to have a substantial series of discussions on Clause 25. I do not understand how it is that the right honourable gentleman says that this provision—which plainly, on its face, gives a local authority an opportunity to buy any man's house the moment he wishes to sell it to anyone else—is simply a little matter to give that person notice that the local authority are buying land in that area.
If that is so I shall want to know under what powers the local authority are proposing, or are enabled, to buy the land mentioned in Clause 25: because if they are powers other than powers under the Bill or under the planning Acts, I should have thought that we need a very substantial amount of further explanation. The noble Lord, Lord Melchett, may be able to touch upon this this evening; if not, I warn him that we shall return to it.
I should like to mention one or two other individual matters which have been raised. There is the question of the Land

1429
Authority for Wales. There are a number of mysteries here. For instance, I have looked at the Welsh Development Agency Bill, to which my noble friend Lord Elton referred. This seems also to have powers, among other things, to provide sites and premises, services and facilities for industrial undertakings, and there can be a direction to the Agency to do this, and the Agency do it with further agency agreements with local authorities. There are other powers in Wales, which obtain in the local planning authorities, whereby they can carry out development. We want to know how all this is to work and, in particular, how it is to fit in with the devolution proposals for Wales, which I believe must be the foundation of all this. I shall not ask the noble Lord, Lord Melchett, to deal with this matter tonight. But I am afraid that it will not do for the noble Baroness to leave us to wait, with our thoughts uncollected, until the Committee stage. I very much hope that some document can come my way before then—perhaps next month—which will explain some of this in rather greater detail than has been available from discussions in another place—
Baroness BIRK: My Lords, the noble Viscount had a word with me about this and I undertook to let him have a paper next month, and it will also be circulated to all noble Lords on both sides of the House.
Viscount COLVILLE of CULROSS: My Lords, that is a very happy solution. Perhaps the noble Lord, Lord Melchett, would like to say a word about Part IV regarding unoccupied office premises, which has not been mentioned by anyone in the debate. What are the local authority or the Secretary of State to do with these premises when they have been compulsorily acquired at knock-down value? Where is the market? What is he to do? Why is the existing law inadequate? Perhaps the noble Lord will be able to answer me when he has received whatever message it is he is in the process of receiving.
Like other noble Lords who have spoken today, I am interested in the necessity under Clause 43 for all disposals of land, and. I think, appropriations, too, of more than seven-year leasehold to require the sanction of the Department. Again the Government's
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discussion of this matter in another place leaves me acutely unhappy. There is supposed to be some give and take, some question of swings and roundabouts, as I understand it, but I cannot understand why some of the minor exemptions which have been given to local authorities over a period of time are now being taken away wholesale because of something to do with the Community Land Bill.
My Lords, I said that I would return to the point about finances mentioned by the noble Lord, Lord Pitt of Hampstead. I hope that the noble Lord, Lord Melchett, will be able to explain—if not tonight then on some other suitable occasion—a little more about how this will work. We are told by the noble Baroness that the money from this Bill can finance projects the cost of which would otherwise fall on the rates. I should like to consider how this works in terms of paragraph 40 of the Consultation Document, which says:
"All land account surpluses accruing to local authorities will be available for the following purposes: for the repayment of debt"—
That is capital repayment and will not, in itself, allow them any money to spend on anything else. It goes on, secondly:
"to finance expenditure in a key sector project which is within an agreed programme"—
Money which, I should have thought, would have been obtained from the Public Works Loans Board if it had not been obtainable from this source. Therefore, all that this does is to relieve the Public Works Loans Board from the capital advance necessary; and, thirdly:
"to finance expenditure within the locally determined sector on the basis that the agreed level of borrowing for this sector was reduced pro tanto."
Again, this relieves the Public Works Loan Board; but that does not mean to say that they get any more money because the money from the Community Land Bill is reduced pro tanto and they get less from the Public Works Loans Board.
Where, in all this, is anything other than loan repayment of interest available for those in local authorities to spend? One must take it a little further. The noble Lord, Lord Pitt, rightly said that if you fail to compensate anybody on compulsory purchase at more than the

1431
current use value, the local authority will acquire the land cheaper. He is right. The people who will suffer are the Exchequer because hitherto they have received either 8 per cent. or, I suppose, in the end, 100 per cent. of the profit in the form of taxation. This will cease. The local authority will obtain land cheaply, but the Exchequer will lose all that taxation and central Government will be short of income they had hitherto received. The noble Lord, Lord Castle, shakes his head. I cannot see what is wrong with my logic.
Lord CASTLE: My Lords, my understanding of the Bill is that the central Exchequer gets 40 per cent. of the surplus. This was explained by my noble friend Lord Pitt when he spoke.
Viscount COLVILLE of CULROSS: Yes, my Lords, it does. And this leads up to what I should like the noble Lord, Lord Melchet, to help me with. Would he do so, if not tonight, then before the Committee stage of the real Bill reaches this House? Can we see some of the balances that are supposed to be forthcoming because of this Bill? I am not prepared to believe that profits will flow and money will be available to finance projects otherwise falling on the rates unless I see a more convincing argument, which carries the logic through, than anything I have seen so far. Cannot we be told how it will balance out over the economy as a whole and how the losses I have mentioned in the Exchequer field will be made good in part, as the noble Lord, Lord Castle, said: and how we are all going to be richer in the end than under the increased flow, or under the same flow, of development land being brought forward under the system we have known hitherto?
Until I have seen that, I am not convinced that this Bill is going to do anybody any good at all. What I do think—and perhaps noble Lords opposite may get one spark of hope out of my saying this—is that I believe that this Bill will just work. It will work slowly, excruciatingly slowly; it will work painfully and it will work grudgingly; because all of it will go against the grain of everybody who owns land in this country; but I believe that if they go on long enough they can bludgeon it through.
1432
The secret of this Bill is in its timing. The noble Baroness, Lady Stedman, put her finger on it when she said that for three or four years there will be land available in the land banks already owned by developers so that house building rates will not decline. It may be that it is a coincidence that noble Lords opposite in the Government have allowed those who had land banks with planning permission on the 12th September last to continue under the old taxation system, with no danger of having their land compulsorily acquired. The result is, as the noble Baroness rightly said, that house building will continue for about three or four years. The Labour Party statistics of starts in the private sector and the public sector, if the economy otherwise picks up, will continue to be admirable. It will not be until after the next Election that the chickens will come home to roost. Because those chickens will come home to roost—and this is the reason for it—because in the end it will be shown that this simply does not work, quite apart from any feelings that we may have, we shall have to repeal it.
8.45 p.m.
Lord MELCHETT: My Lords, this has been a long and interesting debate. I am glad to say that the fact that we are discussing in this No. 2 Bill the version of the Bill which is about to be amended in Report stage in another stage, has not inhibited noble Lords. I think that our debate has proved that the noble Lord, Lord Foot, was right and that the noble Baroness, Lady Young, and the noble Earl, Lord Kinnoull, were quite wrong in saying that this discussion of the No. 2 Bill was going to make the job of this House quite farcical this afternoon. We have had a good and sensible debate on a good and sensible Bill. I would say to the noble Lord, Lord Foot, in regard to what I thought was an excellent and reasonable speech on the subject, that I listened with great interest to what he said about the choice of local authorities as agents in implementing the Bill. I think his points about a possible regional tier were very interesting but probably a question for further local government reorganisation rather than something that could be done in this Bill.
I should like to make two points about the choice of local government. One is that the smaller the unit the more people

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feel it is close to them locally, Secondly, local authorities do exist in the set-up at the moment. Therefore I do not think his remarks about a large new bureaucracy having to be established are true. The Government Amendments that may be made to the No. 1 Bill in another place, are, I understand, almost all being brought forward to meet points raised by the Opposition during the Committee stage in another place. I have no doubt that when we eventually get the No. 1 Bill, it will get a warmer welcome than noble Lords opposite have been able to give to the No. 2 Bill.
My Lords, I was grateful to the right reverend Prelate the Bishop of London and the noble Lord, Lord Macleod of Fuinary, for their generous welcome to the Government proposals on churches and charities. I accept that there are still some points to be agreed. As the right reverend Prelate knows, discussions with the Churches Main Committee are still in progress. I do not think that I heard the right reverend Prelate say, "Hear, hear!" when noble Lords opposite complained that our provisions were not yet drafted because consultations are going on. I assume that what the noble Baroness, Lady Young, and her noble friends wanted were provisions introduced before consultation was complete and a Bill presented to this House as a completely definitive version and one that the Government had no intention of changing at all. That is the only possible explanation I can see for their jibes at my noble friend when she said that Amendments had not yet been drafted.
Baroness YOUNG: My Lords, I would not wish it to be thought that I would make a jibe at the noble Baroness, Lady Birk, and least of all to do anything to interfere with consultations between the Churches and the Government. My objection to this procedure is that we are debating on Second Reading a Bill in which major and important changes are in process of being made and we do not know what they are.
Lord MELCHETT: My Lords, I may have a different view of your Lordships' House from the noble Baroness; but I thought that the point of having Bills coming here, being discussed and going through their stages was so that changes such as these could be made. If these
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changes must be made to the Bill when it comes here, this House would be an excellent place for changes concerning Churches and charities to be made. I am astounded that the noble Baroness is saying that these have got to be done before we get the Bill. Is she saying that this House is incapable of making these changes to the Bill?
Viscount DE L'ISLE: My Lords, I have been here longer than most. Bills are normally presented complete on Second Reading.
Lord MELCHETT: My Lords, I think I have dealt with that point already. I was going to say that this is a complicated Bill. I acknowledge that it is complicated still further by the presence of the Bill in the other place. I hope that in return noble Lords opposite will acknowledge that it has been further complicated by the usual hysterical attitude taken up by the Conservative Party and the Tory Press whenever we on this side of the House attempt to fulfil an Election Manifesto pledge. Given these complications, I should like very briefly to go back to basic principles and try to answer the question: "Why introduce this Bill at all?"
The present arrangements for the supply of land for development in this country are a mess. We simply cannot allow them to continue. First, they are unjust. None of us—except, as I understand it, the noble Baroness, Lady Hornsby-Smith—ever want to see again the situation as it was in 1972–73, when soaring land prices put huge unearned gains into the pockets of landowners and speculators.
The Earl of ONSLOW: My Lords, will the noble Lord—
Lord MELCHETT: I will just finish the paragraph, if I may. This was, as I understand it, the "unacceptable face of capitalism" so detested by Members of all Parties. Thousands of ordinary men and women suffered as a result of the speculation in land and property during that period; indeed, many are still suffering, and many areas remain blighted today as a result of the anti-social behaviour of speculators several years ago. If either the noble Earl or the noble Baroness wish to intervene—
Baroness HORNSBY-SMITH: My Lords, the noble Lord accused me of

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being the only Member on this side of the House prepared to see wholesale exploitation and profiteering, and I categorically said in my speech that I did not support it, that nobody on this side did, and that I felt it was far better dealt with by taxation of that exploitation and betterment and not by compensation. The noble Lord will read it in Hansard tomorrow.
Lord MELCHETT: I will certainly read with great interest in Hansard tomorrow what the noble Baroness said. When following the speech with great care, I found it difficult to believe that she was talking about the same Bill as many of her noble friends opposite and, indeed, the rest of your Lordships' House.
The present arrangements are also appallingly unfair because local authorities—which ultimately means individual ratepayers and taxpayers—have to buy land for schools, roads and open space at a price which embodies the value of the planning permissions they themselves have granted, and the expensive roads, sewerage and so on that they have paid for out of public money.
If I may say so to the noble Viscount, Lord Ridley, I do not think his analogy about the Rembrandt being sold is at all fair. If the National Gallery purchased a Rembrandt and repainted it, and then were able to "flog" it for twice the price they paid for it, and were stopped from getting that increased value, that would be a valid analogy with the situation in regard to what, as I understand it, local authorities are doing with land. I do not think that selling Rembrandts has anything to do with it.
Viscount RIDLEY: If the noble Lord is advising the National Gallery to start repainting Rembrandts, that would be an act of the utmost phillistinism.
Lord MELCHETT: I hope the noble Viscount will not advise local authorities, including the one of which he is an eminent member, to stop building roads, sewerage, and all the other facilities which increase the value of land in much the same way.
Viscount RIDLEY: My Lords—
Lord MELCHETT: My Lords, I have already given way, and I have a great deal further to go. I was underlining our
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view on this side of the House as to why the current situation is unfair. On top of that, it does not have the advantage that some people apparently felt that fascism gave the Italians; namely, efficiency. The present arrangements are extremely inefficient. Investment badly needed for productive industry gets diverted into agricultural land—and boosts the price of that out of the reach of working farmers—in the hope of speculative gain. The private land market collapsed shortly before we took Office because it was unable to cope. Financial institutions are still reeling from the blow. How can necessary development take place in such an unstable situation? Developers need a steady supply of the right land—and even they admit that the present system cannot give them that.
So we have a situation that is unfair and inefficient. Noble Lords opposite, as I understand it, offer taxation as a solution. If I have it right, they envisage something rather like our present proposals, where local authorities would buy net of the tax element. That at least is an advance on their previous thinking. But I cannot help asking myself why noble Lords opposite are suddenly so keen on introducing a new and swingeing tax. I would hesitate to suggest that it is because of the ease with which it could be repealed, were it not for history. One attempt by Lloyd George and three attempts by the Labour Party to tackle these problems have all been repealed or abolished, three times by the Party of noble Lords opposite, once by a National Government.
Of course, taxation is a partial solution. But it completely ignores something of fundamental and primary importance: the need to plan positively in the best interests of the community as a whole. As my noble friend stressed at the beginning of the debate, we must get away from the idea that planning is simply about stopping undesirable development. It is not, and it must not be. The time has come to shift the balance more in favour of actively planning to create the right communities in which people want to live, not just the communities that emerge from the drawing boards in the offices of profit-making companies.
Turning to what has, I think, been one of the main themes of today's debate, I have been asked several times: can the

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country afford this scheme? Is it not inflationary? Does it not mean that local authorities will have to disregard the Government's strict instructions not to increase staff numbers or expenditure? This was the point made by the noble Lord, Lord Middleton, and the noble Baroness, Lady Young, and many others. I confess I find all this difficult to understand. How can it be said that "we cannot afford" proposals which will immediately bring down the cost of land for public purposes, and ultimately yield substantial profits from dealing in land for private development? We estimate, in answer to the noble Viscount, if he is listening and not talking to his friends—
Viscount COLVILLE of CULROSS: I was saying "Oh yeh".
Lord MELCHETT: I am not sure whether "Oh yeh" is a Parliamentary term. My Lords, I was going to tell the noble Viscount that we estimate that when the scheme is fully working, with acquisition at current use value, local authorities will be saving about £350 million a year on the cost of buying development land for their own purposes. Then it is asked: Will the scheme ever be profitable?"
Viscount COLVILLE of CULROSS: Has the noble Lord the figure of what the Exchequer will be losing in tax?
Lord MELCHETT: I think I am coming to that in a minute, if the noble Viscount will bear with me. My Lords, I was going on to discuss the question of whether this will ever be profitable. Of course it will. Authorities will in future be buying land net of development land tax, and selling land which is ripe for development. Again, when the scheme is fully operational, the net gain on disposals of land, after acquisition costs and administrative costs, is likely, in our view, to be of the order of £350 million to £550 million per year, in England and Scotland.
I can assure my noble friend Lord Pitt of Hampstead that nothing in the Bill about the proposed sharing between local government and the Exchequer will stop the Layfield Committee looking at the split in its overall review of finance in this field. Of course, the speed with which we can move towards our objectives will depend on resources: and the resources
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available will have to be decided in the light of the general economic situation and of other calls on public expenditure. But, as my noble friend explained, we have designed the scheme so that we can cut our coat to suit our cloth. So the present economic situation is no excuse for not getting the machinery set up and making a start on bringing in the scheme, in step with the availability of resources.
Noble lords may say: "However little you do now, it is bound to be inflationary." Well, in the long-term, I hope we can all agree, the scheme will certainly not be inflationary, as it will be self-financing and will allow us to reduce local authorities' overall borrowing requirement. To answer one of the points which the noble Viscount raised, it is of course the financing of that borrowing requirement which falls directly on the rates, and which will be a future saving on the rates. In the Government's view, in the immediate future, the net effect will be small. The costs of land acquisition will be at least partly offset by an increased tax yield from the development land tax. Of course, as I have said, the precise balance will depend on the speed of the transition to full local authority participation. But I would stress that the scheme will not make any significant increase in demand on real resources, since only a transfer of assets is involved. After all, people are buying and selling land now. All that will happen in future is that more of these transactions will involve the public sector. To use the economic jargon, this is not a resource cost, but a transfer payment.
A great deal has been said in this debate about the alleged lack of fairness in the way the scheme will operate. I confess that I fully expected these charges to be levelled at the Bill. The noble Lord, Lord Carrington, gave us a foretaste of this criticism last Thursday when he alleged that great sections of this Bill had never been discussed in another place, and that it had been only half digested because of the Government's forcing through the Bill with the aid of the guillotine. The facts are that, as my noble friend Lord Castle said, every single clause and Schedule to the Bill were discussed in another place at great length—there was a total of more than 150 hours in Committee—and that no guillotine was imposed.

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Noble Lords have drawn attention to the wide powers which the Bill gives to local authorities and the Secretary of State. I think this kind of argument might be summed up in the words of a memorandum prepared by the organisation Justice. They say:
"The Committee takes the view that legislation which is merely a loose frame for administrative action and which gives no real guide to what is going to happen in practice should not be accepted by Parliament. Apart from being constitutionally unacceptable, this mode of proceeding creates an impossible degree of uncertainty, which is inconsistent with the rule of law."
I chose this quotation deliberately because, in my view, it gives an extreme position. The Bill is certainly not "a loose frame": it gives a very clear picture of the Government's basic intentions. The key points, such as the definition of "relevant development", the bringing in of the full duty under Clause 20 and of the Second Appointed Day under Clause 27, are clearly spelt out in the Bill and are subject to the appropriate Parliamentary procedures. In addition to that, I am able to tell the noble Baroness, Lady Vickers, that I am advised that the proposed Amendments to the provisions regarding public inquiries will not be in breach of the European Convention on Human Rights, which is a point she raised.
What we have done is to ensure that there is adequate flexibility both over timing and over the detailed application of the scheme. This is not a constitutional issue. If I may pursue the constitutional line of argument to its logical conclusion, we should then find ourselves with a Bill which laid down precisely at what moment in time everything should happen and precisely how local authorities, and for that matter the Secretary of State, were to act in every circumstance. That is the way to achieve absolute certainty. It is also the way to ensure that no measure of this kind, which introduces ideas and concepts which will need to meet the test of being worked out in practice and amended in the light of experience, could ever work successfully. As my noble friend explained in her opening speech, it is of critical importance to the success of the scheme that its implementation should be carefully phased. So this "absolute certainty"
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approach is both misguided and unacceptable to anyone who wants the scheme to have even a chance of success.
Turning to the compulsory purchase powers, the Bill makes changes in the procedure of the compulsory purchase of land, and these have naturally been the subject of some concern. The Government have all along made it clear that there is no question of authorities being able to buy land compulsorily in a completely arbitrary way. Some of these assurances are now reflected in the Bill, and the rest in proposed Amendments which are available to your Lordships. I will therefore, if I may, deal with compulsory purchase on the basis of what the Government are now proposing.
First, the Bill provides that although an authority will not have to state the "purposes of acquisition"—which would not be appropriate where there is a general power to buy land on the basis of its suitability for development—it will have to give reasons. No local authority will be able to acquire land compulsorily without justifying it. Secondly, the Secretary of State is empowered to disregard objections to compulsory purchase where these are made on the grounds that acquisition is unnecessary or inexpedient. This is precedented in the New Towns Act 1946 and, as with that Act, the planning framework will provide a specific context in which there will have been an opportunity for public participation.
Thirdly, the Secretary of State is empowered to dispense with a public inquiry or hearing: but apart from the reserve powers mentioned by my noble friend, this can be only where the planning status of the land has already been considered at a public inquiry. This means that where an authority propose to acquire land compulsorily there must always be a public inquiry, either into the planning status of the land or into the compulsory order itself. The result, in our view, is a fair and judicious balance between the interests of the individual and of the community. Individuals will always be able to put their case at a public inquiry or hearing before their land is acquired, but they will not be able to have two bites at the same cherry.
A great deal was said about the position of private owner-occupiers and private house-building. The Government

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are fully committed to the maintenance of a strong private house-building industry and to the principle of owner-occupation. Not only did the White Paper promise special treatment for owner-occupiers and for land destined for owner-occupied housing but the Government have been at pains to show, by the provisions in the Bill, the importance they attach to the contribution which the private house-building industry can make. We believe that the arrangements now proposed give the industry two things: a long-term assurance of land availability, and a flexible transitional system that will give builders time to adapt to the new situation and which will ensure the continued flow of land while the changeover is taking place.
There is no inconsistency, in our view, between saying that land for housing will be freehold and the idea of building agreements or building on licence. A building agreement is only a means of getting the development carried out by a private builder. It does not affect the fact that the owner of the house gets the freehold when the house has been built. I hope that answers at least one of the points raised by the noble Baroness, Lady Young, at the beginning of the debate on this subject.
The noble Baroness also went into some detail about the position of residential owner-occupiers, and this point was also raised by several of her noble friends. The Bill represents no threat to the interests of residential owner-occupiers. Local authorities have long had powers to acquire owner-occupied property where this is necessary to allow essential development to go ahead, but the Government have made it clear that the scheme is not designed to change planning priorities or to affect the rate at which development takes place. So there is no reason for fears that the implementation of the scheme will mean that all owner-occupied property must be acquired for other development. In any case, where owner-occupied houses do need to be acquired, the owners will continue to receive the market value for their houses and they will be entitled, as now, to the full range of statutory payments under the existing Compensation Code.
The noble Baroness raised the question of the disposal notification area—a point which was also taken up by the
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noble Viscount. Again, I must say that I am afraid I found the comments of the noble Baroness, at least, thoroughly misleading. The local authority does not serve a notice saying that it acquires the land. It says whether or not it intends to do so. Local authorities already do just this in reply to the local land charges search made by a purchaser before that purchaser buys the land. If the local authority want to go ahead with their purchase they have to by agreement or make a compulsory purchase order to which objections can be made in the usual way. What disposal notification areas do is, first, let local authorities know when land is about to change hands so that if they would have bought the land in any event they can try to buy it at this stage when the owner is interested in selling it—in other words, that is in the interests of the owner of the property. Secondly, they extend the categories of blight so that those entitled to blight protection can make authorities buy if the property is blighted—once again, something for the protection of the owner-occupier. Owner-occupiers will not be liable to development land tax if they realise development land value of their houses and up to one-quarter of an acre of garden. That is the only significance of the one-quarter of an acre of garden.
Baroness YOUNG: My Lords, I am sorry to interrupt the noble Lord, because I am grateful for his full explanation. But this is an extremely important point that I have raised about owner-occupiers.
what he has said is true, that owner-occupiers need not worry at all about this Bill, I simply do not understand the provisions of Clause 4 at all and why they are drawn so tightly. I wonder, if he cannot answer this question now—this is very complicated and I am not quite sure
followed all his arguments—whether he would write to me about it.
Lord MELCHETT: My Lords, I think already have answered the noble Baroness at great length. What I have said is that this Bill makes no difference to an owner-occupier's position under the existing law. A compulsory purchase order can already be issued on an owner-occupier if the local authority wishes to buy an owner-occupier's house and if there are good reasons for doing so. They go through the existing procedures. The

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clause to which the noble Baroness is referring—if my memory serves me aright—is providing for local authorities, permanent exemptions from the duty to acquire, so that local authorities will never be under the duty to acquire these particular categories which are set out in Clause 4. That is a separate point from the question of what authorities may do under existing procedures which will not be affected by the Bill. The position of owner-occupiers will not be affected by the Bill at all.
I was saying that owner-occupiers will not be liable to pay the development tax on the development value of their house when that is sold either. The move to current use value will not have a major significance for owner-occupiers; for most houses already change hands on the open market at current use value in any event.. The proposed changes in the provisions of the Bill dealing with compulsory purchase provide, as I have said, safeguards for residential occupiers generally—that is not only for owner-occupiers. Unless acquisition is based on a plan or a planning permission which has already been subject to a public inquiry, there will have to be an inquiry or hearing into an objection to a compulsory purchase order made by a residential occupier. I think that the noble Baroness, as I said, did not fully get Clause 4 right when she originally spoke about it. I was going to go on to deal with Clause 4 but I think I have done so already.
To turn to the manpower position which was raised by several noble Lords and mentioned by my noble friend Lady Stedman, so far as the, land scheme is concerned its introduction next year may obviously call for the filling of some key posts, but in their land acquisition and management schemes authorities will be looking for the maximum utilisation of existing staff by means of sharing arrangements and redeployment. My noble friend Lady Stedman asked what we were doing about ensuring that skilled staff will be available when they are needed. I hope that what I have already said about the sharing of staff and redeployment will go some way to setting her mind at rest. I can also tell her that discussions are still going on between the Department and the professional bodies
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about training arrangements. Where manpower forms a real constraint, the scheme is sufficiently flexible to take account of this.
The Earl of ONSLOW: My Lords, will the noble Lord give way for one brief moment? He has given detailed estimates of the amount of money the community is to gain by this legislation. Therefore, presumably he can give detailed estimates of the number of people the community is to employ to put this procedure into practice. So could he please give the House those numbers?
Lord MELCHETT: My Lords, I think the figures are available. If my memory serves me aright, the number will be 12,700 when the scheme is fully operational, of which about one-third will be professional and two-thirds will be support staff. I think the noble Earl was asking me the cost. Of course, the point of those figures is that they relate to when the scheme is fully operational. We do not know any more than the noble Earl does when that will be, and the cost will obviously depend on the point in time when all those staff are employed.
My Lords, I think I ought to come to the end of what I have to say. I would turn briefly to what I see as the last bastion of the Opposition's defiance to this Bill. As a leader in The Times of 29th July put it, many local authorities,
"…are well aware that they are not equipped to go into property speculation in a big way. Many more demonstrate it by their tardy and unimaginative use of the land that they do own. From this point of view, the Bill is as misconceived as ever."
Last month The Times was saying of local authorities:
"They have not the staff, or the funds, nor is their character such that they possess, or could acquire, the imagination, judgment or motives to fit them to exclusive primary initiative in all development."
In May, a leader in the Daily Telegraph put the view a little more forcefully when it said that with this Bill
"A great deal more power over all of us will be handed to local politicians and bureaucrats who, far from being benevolent and farsighted public servants, will often be petty, incompetent, politically extreme and sometimes corrupt."
With my noble friend Lord Castle I was frankly astonished that the noble Baroness, Lady Young, adopted this line of attack. Her noble friend Lord Colville of Culross said that he thought things

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were done very well by the Oxford City local authority. However, judging by the fears of the noble Baroness about the way local authorities will behave and the possibilities for corruption, she must have had very unhappy experiences in her long and eminent career in a local authority.
If I may say so, this argument about the ability and the rightness of local authorities remains the major divide between this side of the House and noble Lords opposite. My noble friend Lady Birk has already explained the reasons for our choice of the local authorities as the primary agents for operating the scheme and for the separate arrangements in Wales. We are absolutely confident that the new local authorities will all eventually be capable of operating the scheme. Indeed, I find it difficult to see why there should really be any question about this. Noble Lords opposite would do well to remember that public authorities already buy approaching half of the land coming into development each year for their own purposes. My noble friend Lady Stedman with her great experience in local authority affairs confirmed this view of the abilities of local government.
A number of local authorities are already successfully undertaking the kind of role they will have under the land scheme—for instance, as expanding towns or in schemes under the £80 million programme introduced by the last Conservative Government in 1972. We expect a number of authorities to be ready and eager to operate the scheme in full as soon as they can be given the opportunity. I have to admit, of course, that local authorities have had some difficulties recently. They have had to cope with a disastrous reorganisation. In the planning field they have had to settle how to operate the split of functions that was laid down in the Local Government Act 1972. However, given the careful phasing of the scheme which my noble friend outlined at the start of the debate, we see no reason to believe that local authorities will not be able to fit themselves to take on their new responsibilities. I very much welcome what my noble friend Lord Pitt of Hamp-
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Stead said about the preparedness of the Greater London Council in getting ready to implement the Bill.
The Times, the Telegraph and noble Lords opposite complain about this power being given to local authorities. Where is the power now? As my noble friend Lady White said, it is with property companies, financial institutions, landowners and property speculators. Opponents of the Bill are presumably happy with this situation. Indeed, when noble Lords opposite were last in Government they went further and successively eroded the functions of local government by putting water and health in the hands of non-elected bodies. We are now trying to redress the balance a little and in a way which will not put a penny on the rates.
With this Bill, the Government will give the power to plan positively in the interests of the whole community to democratically elected local authorities. Land values created by the community will be enjoyed by the community. The sooner that happens the greater the benefits to everyone in this country. I urge this House to give the Bill their full support.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

GREATER LONDON COUNCIL (MONEY) BILL
BRITISH RAILWAYS (NO. 2) BILL
MILFORD HAVEN CONSERVANCY BILL
GREATER LONDON COUNCIL (MONEY) BILL
Returned from the Commons with the Amendments agreed to

CRIMINAL JURISDICTION BILL [H.L.]
Returned from the Commons agreed to with an Amendment; the said Amendment to be printed.
  COACH PARKING
  COACH PARKING
  LONDON TAXI FARES
  LONDON TAXI FARES
  DEPORTATION RECOMMENDATIONS
  DEPORTATION RECOMMENDATIONS
  MESOTHELIOMA: MISDIAGNOSIS
  MESOTHELIOMA: MISDIAGNOSIS