Sitting of 24 June 1975

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
  JAMES HUGH MAXWELL (NATURALISATION) BILL [Lords]
  Read the Third time and passed, without amendment.
GREATER LONDON COUNCIL (GENERAL POWERS) BILL (By Order)
Read the Third time and passed.

EASTBOURNE HARBOUR BILL [Lords] (By Order)
Order for consideration, as amended, read.
To be considered upon Thursday next.

BROOKWOOD CEMETERY BILL [Lords] (By Order)
Order for Second Reading read.
To be read a Second time upon Thursday next.

FRASERBURGH HARBOUR ORDER CONFIRMATION BILL (By Order)
Considered; to be read the Third time tomorrow.
ORAL ANSWERS TO QUESTIONS
  DEFENCE

    Policy Assessments
    Rear-Admiral Morgan-Gilesasked the Secretary of State for Defence what is Her Majesty's Government's assessment of the threat on which current defence policy is based.
    Mr. Crawshawasked the Secretary of State for Defence what is his latest assessment of the military balance between NATO forces and those of the Warsaw Pact.
    The Secretary of State for Defence (Mr. Roy Mason): I would refer the hon. and gallant Gentleman and my hon. Friend to the assessment of the threat in Chapter I and the assessment of the military balance given in Chapter II of the Statement on the Defence Estimates.
    Rear-Admiral Morgan-Giles: While not seeking to embarrass the Secretary of State about the secrecy of his sources, may I ask him to confirm to the House that his intelligence organisation remains sufficient to enable him to make a good and proper assessment? Secondly, will he say whether his assessment at the moment is that the potential threat to NATO is increasing or decreasing?
    Mr. Mason: Concerning the first question, I can assure the hon. and gallant Gentleman that our security and intelligence are adequate for the purpose that we require. As to the threat, the Warsaw Pact conventional threat is still very strong and has not decreased since I published my Defence White Paper.
    Mr. Crawshaw: Will my right hon. Friend, while realising that détente must be the basis of our policy vis-a-vis the Eastern Powers, take into account the great build-up as against our forces in Europe, and also take into account that recent disclosures clearly show that Russia not only supplied weapons to the Middle East but was fully cognisant of the attack that was to take place on Israel two years ago?
    Mr. Mason: I would not detract particularly from the latter point that my

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    hon. Friend makes, but it has nothing to do with the original Question on the Order Paper concerning the military balance between the NATO forces and those of the Warsaw Pact.
    Mr. Kershaw: In view of the Secretary of State's remark that the strength of the Warsaw Pact forces is not decreasing, will he continue to do his best within the Cabinet to see that our forces do not decrease to danger point?
    Mr. Mason: I valiantly struggle, on behalf of the House and the security of the State, to ensure that our forces are not reduced and that the security of the State is not endangered. So far I think I have managed, within the public expenditure reductions, to be able to make sure that the military involvement is not impaired.
    Mr. Fernyhough: Does not my right hon. Friend agree that both NATO and the Warsaw Pact Powers have enough weapons already to blow up the world a hundred times over? Since it will need only to be blown up once, what is the purpose of adding further to our defence programme?
    Mr. Mason: As my right hon. Friend already knows, because of the recent visit of my right hon. Friend the Prime Minister to the Soviet Union we are earnestly seeking détente between East and West. There are two major conferences in being, one the Conference on Security and Co-operation in Europe, and the other the Conference on Mutual and Balanced Force Reductions between East and West. If we can succeed in both those endeavours, tension between East and West can be lessened and forces reduced.
    Mr. Younger: Will the right hon. Gentleman please answer the question asked by my hon. and gallant Friend? Is it the Minister's information that the threat is at present increasing? If the answer is "Yes", does not it seem a very odd time at which to be reducing our contribution to NATO?
    Mr. Mason: I repeat the reply that I gave to the hon. and gallant Member. The defence posture of the Warsaw Pact remains as it was prior to my defence review, and the threat is exactly the same.

    British Army of the Rhine
    Mr. Goodhartasked the Secretary of State for Defence whether he plans to reduce the strength of BAOR in the next 12 months.
    The Under-Secretary of State for Defence for the Army (Mr. Robert C. Brown): The strength of BAOR is constantly subject to marginal change as a result of unit changeovers and the need to meet commitments elsewhere, such as in Northern Ireland. We will not, however, make any reduction below our Brussels Treaty commitment in advance of mutual and balanced force reductions.
    Mr. Goodhart: As the recent fall in the value of the pound has added close to £25 million to the cost of the British Army of the Rhine since publication of the defence review, can the Minister say what negotiations the Government are having with the West German Government about offset agreements?
    Mr. Brown: That is a matter which we shall take into consideration fairly soon.
    Mr. Ronald Atkins: Does not my hon. Friend agree that one reason for the fall in the value of the pound is the enormous contribution to the deficit in the balance of payments which the British Army of the Rhine causes? After all these years, is it not time that the Government concluded an effective offset agreement with Germany, the country which wants us to stay there and the country most able to help us in our balance of payments effort?
    Mr. Brown: This matter will be discussed in the new offset agreement which comes in, I believe, in 1976.

    Suez Canal
    Mr. Matherasked the Secretary of State for Defence if he will make a statement on the strategic significance for Great Britain and NATO of the reopening of the Suez Canal.
    Mr. Mason: The Royal Navy will continue to deploy from time to time in peace time outside the NATO area and, in common with other navies, will benefit from the increased flexibility of deployment resulting from the opening of the Suez Canal. All maritime trading nations

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    stand to benefit. As for NATO, the Suez Canal lies, of course, outside the boundary of the NATO area.
    Mr. Mather: In view of the massive increase in the strength of the Soviet Navy in recent years and in view of the fact that, as the White Paper points out, this is out of all proportion to the needs of Soviet trade, can the right hon. Gentleman say what consequences flow from the reopening of the Suez Canal and whether this is the right time simultaneously to withdraw our forces from NATO ports in the Mediterranean area, which would be a new sea route, and deny ourselves the facilities of Simonstown?
    Mr. Mason: The balance of influence in the Indian Ocean will not be significantly altered. It will grant increased flexibility to both sides. For the Soviet Fleet, the reopening of the canal will mean a reduction of 24 days in sailing time to the Indian Ocean, and we shall be able to be there 10 days sooner. It is flexible for both sides.
    As for the Mediterranean, we still allow the Royal Navy to deploy occasionally in the Mediterranean with the naval on-call forces, and the hon. Gentleman will have noticed that since our statement about lessening our presence in the Mediterranean the French and the Italians have increased theirs.
    Mr. Molloy: Does my right hon. Friend agree that the best way of enhancing our status in the Mediterranean and the Middle East is never again to embark upon policies which would bring world hostility, close the Suez Canal and make the British nation look foolish, as happened some years ago?
    Mr. Mason: I hope that the House learned that lesson long before my Defence White Paper. Even if it had not, the new defence posture brings us more into line with what we can do. We intend to maintain our presence in the central region of Europe. We intend to play a part in the approaches of the Eastern Atlantic. We intend to make sure that the home base is secure. Therefore, we shall have few opportunities to become involved in exercises of the kind which sucked us into international conflict elsewhere.
    Mr. Alan Clark: Is it not true that the Soviet Union enjoys a factor of two and a half times in the reduction of sailing time over our own as a result of the reopening of the Suez Canal and, therefore, that the greatest strategic advantage attaches to the Soviet Union? As a result, is not the maintenance of the base at Gan, which commands the exit to the Red Sea, now of primary importance to this country.
    Mr. Mason: Gan has nothing to do with shipping and port facilities. It is mainly an air station in the Indian Ocean. We shall still have transit and communications facilities in Diego Garcia.

    North Sea Oil Installations
    Mr. Townsendasked the Secretary of State for Defence if he will make a statement on the result of the meeting of NATO Ministers on 5th June 1975 regarding the defence of North Sea oil installations.
    Mr. Mason: I assume that the hon. Member is referring to the meeting, not under the auspices of NATO, which was held in The Hague between officials of a number of countries with an interest in the protection of offshore installations. This was a wide-ranging initial discussion on this important and complex subject and it is expected that a further conference will be held later this year. I have arranged for a copy of a communiqué issued following the meeting to be placed in the Library.
    Mr. Townsend: Is it not likely that Western Europe will become more concerned with the bringing ashore of energy resources from the North Sea and that it is important that NATO should keep its eye on all present and planned installations there, including Norway's? What does the right hon. Gentleman intend to do to encourage NATO to show more activity and concern in this matter?
    Mr. Mason: All NATO nations would not agree with the viewpoint of the hon. Gentleman that NATO should be involved primarily in the defence of the North Sea installations. Those who take a keen and detailed interest in defence affairs will know that there are countries on the northern flank which would hesitate to operate in that way. This was a meeting of officials of a number of

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    countries—Dutch, German, French, Norwegian, Danish, Belgian and ourselves. We were trying to find how best to measure ways in which all our resources could be used against the threat of accident or malicious damage in the North Sea in peace time.
    Mrs. Winifred Ewing: In the right hon. Gentleman's talks, did he get down in detail to what we are meant to be defending these installations against? He mentioned accident. Does he mean fishing hazards? Does he envisage that there will be any state of open war against these installations? Is it not essential to ascertain these facts before we can know how we can defend them? Is the right hon. Gentleman aware that the view of military authorities in Scotland, openly expressed, is that these installations are not defensible and that there is no way in which they can be defended?
    Mr. Mason: I hope the hon. Lady will not try to build this up into a scare story. The North Sea rigs and installations are there, easily to be seen. Soviet naval gatherers occasionally come along to photograph and to measure them. If I were advising the House, I should say that this was not any military threat. It is because the Soviet Union needs commercial information to deal with undersea drill rigging itself. It wants to embark upon this. It lacks the technology. Our intelligence leads us to believe that, when the Russians carry out aerial photographic reconnaissance or when their intelligence-gathering vessels go nearby, it is to find out how commercially and technologically we have tackled this task.
    Mr. Dalyell: Is not the suggestion that North Sea rigs are not able to be defended simply preposterous? What rôle do the Government see for Nimrods in North Sea defence?
    Mr. Mason: As my hon. Friend probably knows, already we have two vessels patrolling the North Sea. We have another five vessels under consideration for contract especially for that purpose. We now have Shackletons, Vulcans, Buccaneers and also Nimrods on occasional surveillance activities for North Sea rigs.

    Multi-role Combat Aircraft
    Mr. Tebbitasked the Secretary of State for Defence if he will make a state-
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    ment on progress of the MRCA development programme.
    The Under-Secretary of State for Defence for the Royal Air Force (Mr. Brynmor John): Progress continues to be generally satisfactory.
    Mr. Tebbit: Is the Minister aware that that is a short statement for a long programme? Is he in a position to comment on and preferably deny the reports which are abroad that the flight test programme is now something like six months behind and that it is to that extent delayed because of the late delivery, the non-delivery and the scarcity of flight test engines from Rolls-Royce Ltd.?
    Mr. John: Clearly in an advanced technological project some difficulties are always experienced during the development stage. There were some hold-ups from Rolls-Royce due to industrial action, but delivery of the engines has now been resumed.
    Mr. Watkinson: Does my hon. Friend accept the view put forward in the Second Report from the Expenditure Committee that as a result of the collaboration on the MRCA the costs are 25 per cent. higher? Does he accept that figure, and does he anticipate that all such collaborative projects will involve such a premium?
    Mr. John: No, I do not accept it. From the figures I have had, this is clearly the most sucessful international collaborative project ever, in which the real escalation of costs has been minimal and has been carefully controlled.
    Mr. Wigley is it not ironic and rather pathetic that at a time of impending economic crisis we should be launching into the production of another white elephant in the shape of the MRCA? Have we not learnt our lesson as a result of Blue Streak and the RB2
    Mr. John: The hon. Gentleman's unexpected interest in military matters gives me great satisfaction. Clearly any

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    defence of this country is based on a combination of the economic health of the country and the measures taken to support it. Without economic health, no defence would protect these islands. However, no economic health in itself would protect us if we did not show the will to protect ourselves.
    Mr. Onslow: I am grateful to the Minister for educating the hon. Member for Caernarvon (Mr. Wigley) on his first incursion into defence matters. Will he deal with the persistent rumours that the MRCA engine still has serious teething troubles? Can he particularly say what action we are taking to obtain wider markets for the aircraft by selling it elsewhere in Europe, where the demand exists?
    Mr. John: As I tried to point out earlier, in any advanced technological programme there are always problems in the development phase. What is unique about this programme is that it has taken place in such a spotlight of publicity. There is nothing untoward about the difficulties so far experienced. We will take whatever opportunities are open to us to commend the MRCA to a wider public.

    Ship Repairing (Merseyside)
    Mr. Loydenasked the Secretary of State for Defence how many ships, RN or RFA, will be overhauled, repaired, etc., in the Merseyside shipyards from the present date to the end of 1975.
    The Under-Secretary of State for Defence for the Royal Navy (Mr. Frank Judd): Royal Navy ships are normally refitted and repaired in the Royal dockyards. None is presently scheduled to be dealt with in a commercial shipyard.
    It is planned, however, to refit about 15 Royal Fleet Auxiliaries in commercial shipyards during the remainder of 1975. Tenders for these refits will be invited from suitable shipyards, a number of which, like the Merseyside shipyards, are located in development areas.
    Mr. Loyden: While I am grateful to my hon. Friend for that information, may I ask him whether he is aware that there has been a serious shortage of this type of work in Merseyside with the result that at one time in the recent past there was the possibility of lay-offs and
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    closures? Is he further aware that the way in which this work is distributed is unfair to Merseyside? Will he look at the questions raised about contract prices and delays, all of which have been strongly refuted by unions and management in Merseyside shipyards?
    Mr. Judd: While I appreciate my hon. Friend's concern, I am sure he will recognise that a reduction in defence expenditure inevitably has consequences in this area as in others. We are at pains to put work of this kind with firms situated in development areas. When deciding how to award tenders, we have to take into account points like price, delivery dates, the loading of the shipyards concerned and the previous performance of shipyards.
    Mr. Crawshaw: Does my hon. Friend agree that it shows how ludicrous is the argument of those who seek to do away with all our defence forces that they start bleating only when they do not get work in their own areas? Would he not have expected my hon. Friend the Member for Liverpool, Garston (Mr. Loyden) to be delighted that we do not have any naval ships which require to be repaired on Merseyside?
    Mr. Judd: That is a question for my hon. Friend himself to answer.

    Expenditure Reductions
    Miss Fookesasked the Secretary of State for Defence if he has any plans to make any further cuts in defence expenditure additional to those already published in the latest White Paper and announced in the Budget Statement.
    Mr. Mason: No public expenditure programme can be guaranteed irrespective of the development of the economy, but our planning continues to be based on the broad level of capability decided on in the defence review.
    Miss Fookes: Does not the right hon. Gentleman agree that that is an extremely cagey answer which will do nothing to increase Opposition confidence in the Government's serious intention to maintain our defence ability?
    Mr. Mason: I am sorry that my reply disappoints the hon. Lady and others. It happens to be a fact of life. If there are major public expenditure cuts, defence

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    must be involved. What perturbs me is that the hon. Lady and her hon. Friends keep pressing me to spend more on defence while I see that their economic and financial spokesmen are calling for public expenditure cuts of £4,500 million.
    Mr. Frank Allaun: Does the Minister admit that our arms spending in both real and cash terms—much more so in cash terms—is going up and not down? Will he clearly dissociate himself from Conservative Members and, I regret to say, one or two on the Labour side who are arguing for cuts in industry, housing, education, health—in everything except arms expenditure, which they wish to increase? If there is any doubt about this, let my hon. Friend refer to Hansard to see that hon. Gentlemen said precisely that in last week's debate.
    Mr. Mason: I hope my hon. Friend will realise that defence has certainly played its part in the public expenditure cuts that have so far taken place. I hope he appreciates that in 1975–76 we shall save £300 million, in 1976–77 we shall save £380 million, in 1977–78 £350 million, in 1978–79 £500 million and in 1979–80 £660 million. Therefore, we shall save a total of £2,190 million on planned expenditure on defence at 1974 prices over the next five years.
    Mr. Peter Mills: Does the Minister realise the concern that the Government are causing among young people in the South-West who contemplate a Service career? Is there any future for young people in the Services?
    Mr. Mason: The savings I have announced to the House arise mainly because we have decided that we can no longer police the world. Our international posture is at an end. We are therefore withdrawing from Singapore, Gan and Mauritius and lessening part of our commitment on NATO's flanks. That is how we have been able to effect these savings. Young men who join Her Majesty's Forces know that their future will be geared towards the new alignment with Europe. In that we certainly have a rôle to play.
    Mr. Alan Lee Williams: Does my right hon. Friend agree that any further defence cuts would be immensely damaging to the cause of multilateral disarmament? May I congratulate him on his
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    firm decision to order the maritime Harrier for the Royal Navy? Can he say what rôle he envisages for that aircraft in the Eastern Atlantic, where the Russians are building up their forces?
    Mr. Mason: I am much obliged to my hon. Friend for raising the subject of the maritime Harrier. This is indicative of the recognition of our new rôle in Europe and the Atlantic. We recognised that there was a threat from airborne surveillance by the Russian Bear aircraft. We have decided to fit our through-deck cruisers with the maritime Harrier, which will be able to stop and harry the Bear aircraft, preventing it from carrying out its surveillance activities, in the course of which it communicates information to long-range missiles at sea.
    Mr. Younger: Does not the right hon. Gentleman have to admit that it is now the unanimous and publicly-expressed view of our NATO allies that the cuts he has announced are gravely damaging to the alliance? With that in mind, is not the least we can ask him to do to undertake that there will be no further cuts, for the sake of our country and of the people in the Services?
    Mr. Mason: I agree that our NATO allies were seriously disquieted during the course of our defence review and at its conclusion. They publicly expressed their views. I am sorry that I cannot give the hon. Gentleman and the House a categoric assurance that defence cuts will not flow from any other public expenditure reductions. Obviously I cannot give that assurance. As far as I am concerned, if I feel that it will impair our rôle or the security of the State I will try to help.

    Service Establishments (Northumberland)
    Mr. Beithasked the Secretary of State for Defence whether any reduction in Service personnel or civilian employment at RAF Boulmer, the RAF Acklington helicopter squadron or the Otterburn Training Area will occur as a result of the reductions in defence expenditure recently announced.
    Mr. John: No reductions in Service or civilian employment will occur at these units as a result of the recently-announced cuts in defence expenditure.
    Mr. Beith: That news and that assurance will be welcome in the communities concerned, whose relations with the people manning the Service installations are good. Does the Minister agree that in locating defence installations operational needs are paramount, but that an important consideration is the employment which the installations provide in areas where there is little alternative employment?
    Mr. John: Yes. That is why we have tried to take account of development areas in framing the review which we have just announced.

    Recruits (Wastage)
    Mr. Dempseyasked the Secretary of State for Defence if he will investigate the amount of wastage among young recruits to Her Majesty's Forces; and if he will make a statement.
    Mr. John: Investigations are already under way into the extent and causes of wastage. At this stage, therefore, I have nothing to add to the reply I gave my hon. Friend on 11th March this year.
    Mr. Dempsey: Does my hon. Friend consider that one of the probable reasons is the unrealistic and misleading recruitment advertising campaign on television, which projects a picture of Army conditions which are more in keeping with Billy Butlin's holiday camp than reality? On reflection, as many young persons are anxious to leave the Services, will the Minister please consider allowing these young people to interrupt their apprenticeships after, say, three years and leave them the option of leaving or staying on?
    Mr. John: I do not know where my hon. Friend has seen the advertisements to which he has referred. If, however, he seriously thinks that there are advertisements which are misleading, I hope he will refer me to specific examples. It is my experience, having looked at all the recruiting material recently introduced, that the Forces are, as never before, giving a realistic picture of what life will be like in the Services, for the Services' self-protection, to avoid the wastage which my hon. Friend obviously wants to avoid.
    We have gone a long way towards providing a more flexible career for young people entering the Services. However, I shall be glad to look at my hon. Friend's
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    suggestion and let him have my views on it.
    Mr. Scott-Hopkins: Does the Minister accept that there is great disillusionment among young Service personnel following the recent pay review? Owing to the extra charges which they must suffer at the same time, young Service people receive nothing like the amount of increase that was announced.
    Mr. John: If there is disillusionment, I am sorry. That is not my experience after talking to probably as many young Service men as the hon. Gentleman. We set up an independent pay review body. Our commitment—the commitment of any Government—is to implement the results of that review. That is exactly what we did.

    Tactical Missiles
    Mr. Wallasked the Secretary of State for Defence what proposals he has for standardising the next generation of tactical missiles throughout NATO.
    Mr. Mason: As with other equipment, I should like to see a much greater degree of standardisation of the various kinds of tactical missiles in the next generation. We for our part will be looking for cooperation of one kind or another to meet most of our future requirements for such missiles.
    Mr. Wall: Is the Minister aware that the European nations of NATO are producing no fewer than 18 different kinds of surface-to-surface and surface-to-air missiles and 16 anti-tank weapons, all of which duplicate each other? The real problem is one of basic design study. Will the Minister give consideration to NATO undertaking this study for all of us, since we are now all fighting the same war?
    Mr. Mason: Yes. I appreciate the authority of the hon. Gentleman in view of his rapporteur activities on this subject at Western European Union. I can tell him. however, that the conference of national armaments directors is now attempting to achieve standardisation of the next generations of weapons, and meetings are being called solely for that purpose.
    Mr. Newens: Will my right hon. Friend take note that many Government supporters hope that there will not be a new

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    generation of tactical missiles? Is it not stupid that mankind should continue to embark on this never-ending arms race, which represents a tremendous threat to humanity in military and economic terms? Is it not time that we heard more about disarmament and détente than we hear on these occasions when we discuss military matters?
    Mr. Mason: I am sure that my hon. Friend was present when I spoke about détente in answer to an earlier Question. Let him not think that when we talk about tactical missiles they might be nuclear missiles. At the moment Her Majesty's Government are considering four new types of missiles, which include helicopter-launched anti-tank guided weapons, crew-portable anti-tank guided weapons, undersea guided weapons and helicopter-launched anti-ship guided weapons—all of which, I know, British industry would like. I doubt whether it will get them all. Many thousands of jobs are at stake in the aircraft, aeroengine and missile industries as a result of these conventional missile weapons.
    Sir John Hall: On the assumption that this country will need to co-operate with our NATO allies in the defence of the Western world, may I ask whether any estimate has been made of the savings to this country of standardisation within NATO?
    Mr. Mason: No, I do not think that an estimate has been made of the savings that could be made. Obviously they are considerable. That is why the Eurogroup within NATO—a group of nations involved in trying to bring together equipment requirements for the Western Alliance—is so essential and why its work should be processed. That is one of my intentions as chairman.
    Mr. Robin F. Cook: Will my right hon. Friend confirm that the balance of advantage of specific tactical nuclear weapons to the West is something of the order of three to one? Is not this an area in which we could easily afford to take an initiative at the Vienna talks to achieve a reduction of the presence of these weapons, which are of extraordinarily devastating power, on both sides?
    Mr. Mason: I do not agree with the figures quoted by my hon. Friend. No
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    doubt his latter point will be taken into consideration in the course of that conference.

    Aircraft Procurement (Europe)
    Mr. Adleyasked the Secretary of State for Defence if, in view of recent purchases of American military aircraft by some European NATO countries, he will now initiate a meeting between NATO members within the EEC to discuss the establishment of a policy for production of aircraft within the EEC member countries, for miliary and economic reasons.
    Mr. Mason: The European member nations of NATO will be considering the implication for European defence industries of the recent decisions by four of them to acquire the American F16 aircraft. They will doubtless hold joint consultations, but the precise form and scope of these remains to be considered.
    Mr. Adley: Does the right hon. Gentleman agree that the French tactics in the recent battle for this order tend to show that no single European nation seems able to meet and beat the ruthless competition of the American aircraft manufacturers? If he accepts that, and if he accepts the overriding economic and military importance of a powerful and successful aviation industry, will he now take steps to launch such an initiative as is described in the Question?
    Mr. Mason: First, if the House wants to draw a lesson from the recent exercise, European countries with airframe and aero-engine industries must cooperate, otherwise in future we must buy cheaply off the American shelf. The result will be that the European aircraft industries will gradually wane and will not be able to survive.
    Secondly, I am keen to move towards the next stage of the two-way street of moving more defence equipment between American and Europe. To do so satisfactorily, however, the European industrial armaments industry must be prepared to co-operate so as to get more defence equipment from Europe on to the American street.
    Mr. Skinner: Will my right hon. Friend explain to me the paradox between the so-called claim of the Common Market

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    that by combining together we should be able to compete with the super-Powers—namely, America and Russia—although here is an example, only days after the referendum result, in which, after 18 years of co-operation, even France and Belgium cannot agree whether this competition should take place or whether they should buy their arms, as was the case with Belgium, from America?
    Mr. Mason: If my hon. Friend were more conversant with the Treaty of Rome he would know that it excludes the consideration of defence problems.
    Mr. Amery: Does the right hon. Gentleman agree that the decision of the Belgian Government concerning the replacement did not appear to correspond with any laid-down operational requirement? The French aircraft appeared to be an interceptor while the American was an inadequate ground attack aircraft. What efforts were made by British industry, or by the Minister's Department, to put forward the advantages of the Jaguar, which exists, or the MRCA, which, though more expensive, would exist on the same time scale as the American aircraft?
    Mr. Mason: I personally placed the Jaguar aircraft concept before the Eurogroup on two occasions, and the concept of the two-rôle requirement for the F104 replacement came out of the Eurogroup. As the right hon. Gentleman must know, the four NATO nations were looking for an aircraft that would satisfy the two rôles, ground attack and high intercept. The Jaguar will satisfy the former but not the latter. Therefore, the four nations decided that the F16 was better placed to satisfy those two rôles than was the Jaguar or, indeed, the Mirage Fl. The MRCA has a longer time scale of decision, and it would be far too late for the four nations to take a decision. I hope in the next generation, when we have the three-nation trilateral co-operative effort in Europe—Germany, Italy and the United Kingdom—to be able to bring about more standardisation in our aircraft for the NATO Alliance.
    Mr. Alan Lee Williams: Does my right hon. Friend agree that the French would do better for themselves if they were full members of the Eurogroup, as they are fully entitled to be?
    Mr. Mason: As I have indicated, the concept grew out of the Eurogroup. France is entitled to sit as a member of the Eurogroup. I am sorry that there is a vacant chair to be filled. If the French feel that they can play a part in helping us within NATO and the Eurogroup to cope with our common defence requirements, there is a part they can play inside the Eurogroup.
    Mr. Onslow: Does the right hon. Gentleman agree that it is more important to preserve and improve Europe's aerospace manufacturing capability than to waste time on announcements of the costly nationalisation of British industry? Will he get his priorities right?
    Mr. Mason: The hon. Gentleman, who as usual is jumping in without having done his homework, must fully realise that even before we came to office there was a proposal on the board for the merger of Hawker Siddeley and BAC. We are only taking the logical step to streamline our industry and make it more competitive, if necessary within Europe, but certainly against the United States.

    Special Air Service Regiment
    Mr. Christopher Priceasked the Secretary of State for Defence if he will list in the Official Report those countries in which members of the Special Air Service Regiment are currently operating.
    Mr. Robert C. Brown: I have nothing to add to my reply to my hon. Friend the Member for Harlow (Mr. Newens) on 20th May 1975.—[Vol 892, c. 355.]
    Mr. Price: Is my hon. Friend aware that I am not in the least surprised that he has nothing to add to his previous reply? As his right hon. Friend the Secretary of State for Defence said that it was no longer his aspiration to police the world, and as no doubt my hon. Friend is helping his right hon. Friend to go through the estimates with a fine-tooth comb to try to find something else to cut, will be consider the SAS as a candidate? Many Government supporters do not consider that the activities of the SAS in Northern Ireland, Oman, Malaysia, Thailand or wherever the SAS might be are any credit to this country.
    Mr. Brown: First, I must put my hon. Friend right. The SAS is not involved

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    in Northern Ireland. The House was told in the Statement on the Defence Estimates that it was the Government's intention to continue to give military support to the Sultan of Oman. The level of our assistance is kept under regular review.
    Mr. Townsend: is the Minister aware that many Opposition Members are getting increasingly bored with the totally uncalled-for attack on what is perhaps the finest regiment in the British Army? It is a volunteer regiment which is probably the best-equipped and best-trained in the Army. Will the hon. Gentleman point out to his hon. Friend the Member for Lewisham, West (Mr. Price) that the regiment has also an important rôle in the defence of Western Europe?
    Mr. Brown: Yes, Sir. I am obliged to the hon. Gentleman for his comments. The SAS is a fully volunteer regiment and it is a fine regiment which is doing a fine job. In spite of what my hon. Friend said, the main rôle of the SAS is in the NATO context.

    Brazil (Naval Visit)
    Mr. Dalyellasked the Secretary of State for Defence if he will make a statement on the official visit of Her Majesty's ships to Brazil in May 1975.
    Mr. Judd: A visit to Brazilian ports was made between 7th and 14th May by a group of Royal Naval ships led by HMS "Ark Royal".
    Mr. Dalyell: What effect has the visit had on the Vosper Thorneycroft order?
    Mr. Judd: At present six frigates and three submarines are being built for the Brazilian Navy both by Vosper Thorneycroft and by Vickers. That goes ahead.

    Chieftain Tanks
    Mr. Pattieasked the Secretary of State for Defence whether the Chieftain tanks in service with BAOR will be retrofitted with the new Rolls-Royce diesel engine that is to be fitted to the Chieftain tanks to be supplied to Iran.
    Mr. Robert C. Brown: The Army has no plans to re-engine its Chieftain tanks with Rolls-Royce engines.
    Mr. Pattie: Does not the Minister agree that it seems to follow that we have
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    not learnt from the German experience that it is important to have good engines in our tanks? Will he say how far the trilateral tests that have been going on are likely to affect the Anglo-German battle tank proposals?
    Mr. Brown: I do not agree with what the hon. Gentleman has said. Even the experts do not agree on the precise size of engines for tanks. The tests are still going on and have yet to be evaluated.

    SECRETARY OF STATE FOR THE ENVIRONMENT (SPEECH)
    Mr. Tebbitasked the Prime Minister if the public speech of the Secretary of State for the Environment concerning the need of policies to combat inflation made at Grimsby on 8th June represents Government policy.
    Mr. Adleyasked the Prime Minister if the speech by the Secretary of State for the Environment on economic matters at Grimsby on 8th June represents the policy of Her Majesty's Government.
    The Prime Minister (Mr. Harold Wilson): With permission, I will answer Question No. 01 and Question No. 07 together, Sir.
    Mr. Skinner: What about No. Q19?
    The Prime Minister: I have nothing to add to the reply which I gave in answer to a supplementary question from the hon. Member for Devizes (Mr. Morrison) on 12th June.
    Mr. Tebbit: Does the Prime Minister recollect that that was the speech in which the Secretary of State for the Environment criticised Government policies as having put this country on a disaster course, indeed a suicide course? Is he aware that since then, on Saturday last, the Chancellor of the Exchequer said that there were only six weeks to that disaster? Is he further aware that today there are only 39 days left to disaster day? When will he act?
    The Prime Minister: The hon. Gentleman has totally falsified what my right hon. Friend said. He did not say that it was the consequence of Government policies. If the hon. Gentleman had studied Government policies he would

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    know which Government to blame. On Saturday I spoke on exactly similar lines to those of my right hon. Friend the Chancellor of the Exchequer. He referred to the need for the urgent action that we are working on. He said "at the time". He did not say that we were six weeks from disaster. The hon. Gentleman should look at what my right hon. Friend said and not falsify it in this manner.
    Mr. Tomlinson: Will my right hon. Friend confirm that, whatever actions are taken by the Government to combat inflation, he will ensure that the Government's priorities will mean that the sick, the old and the disabled who need a compassionate society to care for them will not be in the front line of suffering as they have been in past attacks on inflation by the Conservative Party?
    The Prime Minister: My hon. Friend is absolutely right to stress that. What we have said, and what I said on Saturday, is that anyone who tries to get and in future succeeds in getting more money than the country can afford will be causing the greatest suffering of all to the people who cannot look after themselves, such as those mentioned by my hon. Friend.
    Mr. Adley: As last month the Prime Minister delayed taking anti-inflation action because of the referendum and this month his reason for delay appears to be the Woolwich, West by-election, may I ask him to recognise that the nation is coming to feel that he is unfitted, unwilling and unable to take any counter-inflation, action whatever? If that is so, will he now resign?
    The Prime Minister: The hon. Gentleman is wrong in both his hypotheses. What is important is to get the right answer, and the right answer must be on the basis of consent and consensus.
    Mr. Skinner: Does my right hon. Friend still agree with the statements that he and many of his colleagues made during the last General Election campaign when he said that to help the old, the sick, the unemployed and those in the bottom strata of our society we should need the Industry Bill and associated measures of public ownership? Has he noticed that, notwithstanding the local difficulties with which we are beset, so full of contradictions are the Opposition
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    in the Woolwich, West by-election that the local candidate has had to have his election address rewritten three times to comply with the statements made by the right hon. Member for Worcester (Mr. Walker), the right hon. Lady the Leader of the Opposition and the right hon. guru of the Tory Party?
    The Prime Minister: My hon. Friend correctly recalls what I said in the election campaign and what I have said ever since on this question. He will, I know, be the first to agree that, as I have just said, since there are limited real resources available in this country from production and we have to allow for exports, oil prices and so on, if more is taken out by some who have power at least to attempt to take it out, those he has described suffer. The Industry Bill is going ahead and a number of amendments are being tabled tonight for Report which will fulfil what has been said by my right hon. Friends who have been in charge of the Bill up to now. I refer to my right hon. Friend who was in charge of the Bill and my right hon. Friend the Secretary of State for Industry.
    With regard to what has been happening at the Woolwich, West by-election, I was not so much concerned with the position of the Conservative candidate as with the fact that on two successive days this week radio and television, not to mention the Press, have been full of total contradictions between leading Privy Councillors under the command of the right hon. Lady the Leader of the Opposition.
    Mrs. Thatcher: As responsibility for the economic position of the country is that of the Government, and as further delay and uncertainly serve only to damage the pound daily, will the Prime Minister say when he expects to be in a position to bring a package of economic measures before the House for its approval?
    The Prime Minister: As I have said, what is important—[Hon. Members: "Answer".] What is important, as I have said, is to get the right answer and the right package. That will not be the package that the right hon. Lady proclaims even without support from her colleagues. It is more important to get the right answer on the basis of consent

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    —[Hon. Members: "When?") It is more important to get the right answer on the basis of consent and consensus, which takes time—the Opposition tried to do without that when they were the Government and, of course, they failed—than to get the wrong answer on a basis that divides the country. My right hon. Friend the Chancellor of the Exchequer set a timetable. I hope that the answer will come considerably quicker than the timetable he has set.
    Mrs. Thatcher: Will the Price Minister at least undertake to bring measures before the House before it rises for the Summer Recess?
    The Prime Minister: Yes, Sir. Any measures brought before the House—and I stress the important, with which I hope the right hon. Lady would agree, of getting consent and consensus from those concerned—should be reported to the House, I entirely agree with the right hon. Lady, before the recess.
    Mr. Thorpe: Surely the Prime Minister will confirm that for Privy Councillors to disagree on policy matters is nothing new and that he is not experiencing it for the first time. To revert to the speech of the Secretary of State for the Environment, does the Prime Minister remember that his right hon. Friend said that the Government's most urgent task was to bring about basic changes in the social contract to make it an effective weapon? Does the Prime Minister agree with that priority? If so, what changes would he like to see?
    The Prime Minister: Yes, I agree with that priority. That has been stated both by my right hon. Friend the Chancellor of the Exchequer and by myself before the speech was made by my right hon. Friend the Secretary of State for the Environment. The changes that there should be in the social contract are currently being discussed, as the right hon. Gentleman will know, by the TUC. The TUC and the CBI are meeting today for discussions on these matters. I and my colleagues have had a number of meetings with both organisations.

    TUC GENERAL COUNCIL
    Mr. Ovendenasked the Prime Minister if he will make a statement on
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    his most recent meeting with the TUC General Council.
    The Prime Minister: I have had no recent meeting with the TUC General Council, although I am in regular touch with TUC leaders whom I have met on four occasions since the recess.
    Mr. Ovenden: Does my right hon. Friend agree that many trade union leaders have already expressed their readiness to co-operate with the Government in policies aimed at stemming the rate of inflation? Does he accept that the good will which the trade union movement is showing towards the Government stems in large measure from the consistent manner in which the Government have carried out their side of the social contract? Does he accept that continued trade union co-operation must depend upon the Government having policies aimed at keeping down the cost of essential items in the family budget? Therefore, will my right hon. Friend look again at the policy announced by his right hon. Friend the Secretary of State for the Environment and its effect on council rents?
    The Prime Minister: I entirely agree with my hon. Friend about the extent to which trade union leaders are showing tremendous courage, and particularly in the proposals they have put forward for relating wage settlements in future to the target rate for price increases and not to any past period. This is a very big step forward and I know that Conservative right hon. and hon. Members will welcome this fact. One would like to hear them say it from time to time. This is a very important matter and it is certainly the fact, going back to the original agreement about the social contract in 1973, that the Government have fully carried out what we undertook to carry out in the social contract. In those circumstances, we are entitled to expect a response, which we have substantially obtained, and particularly in the latest proposals put forward by the TUC.
    My right hon. Friend dealt with rents in considerable detail on 16th June. Having referred to the fact that we froze rents last year and have moderated rent increases this year through additional subsidies, he went on to give figures showing the increase in rents compared with other

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    costs during the past two years. He said, of course, that while rents are an important part of the cost of living, the contribution of rents to housing costs has been steadily falling over the past few years.
    Mr. Lawson: Instead of the rather absurd charade of warning the TUC that if it does not agree to a tougher so-called social contract there will have to be further public expenditure cuts, would it not be better for the Prime Minister to tell the truth—namely, that there will have to be further public expenditure cuts anyway?
    The Prime Minister: The question of public expenditure is always under review at this time of the year by every Government. Indeed, I think that it was under review by the previous Conservative Government although they never carried out their promises in that regard. It is under review with a view to the publication of the National Expenditure White Paper in the autumn. This process is always going on. I made no threat to the unions as the hon. Gentleman suggests. I stated what is fact in relation to the position of the Government as the paymaster and the treasurer, on behalf of the taxpayer, of the publicly-owned industries—namely, that where there are income settlements or wage settlements which take too much out there is a limit. We shall not allow it to be met now by subsidy, by taking it out of the public or by borrowing. That must mean either a more economical use of labour, with all that that means for jobs, or accepting incomes which are related to what is available within public industry. That is what I said last Saturday, and said very clearly.
    Mr. Atkinson: Will my right hon. Friend further qualify the answer he has just given—namely, that high wage settlements have enabled the British people to take out more than they have put in? Does he not agree that if the Government were to replace the free market price mechanism by a planned pricing strategy, and at the same time replace free trade externally by planning imports, it would not be possible, whatever wage settlements were made, for the British people to take out more than they were putting in?
    The Prime Minister: No, Sir. I made it clear that if in any industry or concern, public or private, more is taken out than can be afforded by that undertaking, be it a nationalised concern or private industry, the result is bound to be, sooner or later, an effect on jobs unless we are prepared to subsidise. As regards a pricing strategy, we have had a strong price strategy from the time we came to office. It is a fact that traders, particularly in food distribution, have suffered very considerably as a result of the tightening of the price strategy. As regards import controls, apart from those which we apply at any time where there is evidence of dumping or unfair trading practices—and we are considering a number of allegations—I do not believe that a large trading nation like Great Britain will succeed in keeping up its exports along with other countries in this chronic world depression by taking such action. I do not believe that we have anything to gain in starting a rat race by cutting down international trade.

    COUNCIL OF MINISTERS
    Mrs. Renée Shortasked the Prime Minister what proposals he intends to put to other EEC Heads of Government about democratising the Council of Ministers.
    The Prime Minister: I see no need to make such proposals. The Council consists of Ministers of the Governments of the member States, each of whom is accountable to a democratically-elected Parliament, each of whom is concerned with his own principal national interests; and the same—I can tell the House from my own experience—is certainly true of the now regular Heads of Government meetings.
    Mrs. Short: Is the Prime Minister aware that the present system is totally unsatisfactory to a very large number of people? Because so many different interests have to be resolved, the horse trading that goes on means that certain important interests for the British people may well be undermined. This Parliament can only ask questions of Ministers when they return from Brussels. The decisions made in Brussels stand, and we

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    cannot undo them. Does my right hon. Friend think that there should be a change? Will he look again at this matter?
    The Prime Minister: As I have made clear at the Council of Ministers, this is happening increasingly, and it is also the case that at meetings of Heads of Government national interests are strongly pressed by individuals. My right hon. Friend the Foreign Secretary is in Brussels today for meetings of the Council of Ministers. He may not be a horse trader, but he is a successful cattle trader. I have every confidence that he will be fighting today as he has always fought, and as the country acknowledged in its recent vote—for British interests. The only criticism I have heard put forward by the German Federal Chancellor is that he feels that the Council of Ministers should be more centralised in the hands of one Minister, the Foreign Minister. He feels that sometimes Agriculture Miniters tend to represent European bloc farm policies rather than the policies of their Governments.
    Sir D. Walker-Smith: Does the Prime Minister appreciate that there are two functions in the Council of Ministers? In addition to the function which the hon. Lady has, with characteristic elegance of idiom, characterised as horse trading, there is also the important legislative function which paradoxically the Community vests in the Council of Ministers and not in the legislature. Cannot that function be exercised in public? Will Her Majesty's Government so recommend?
    The Prime Minister: I agree with the right hon. and learned Gentleman that the Council of Ministers is a policy-making body. It is not engaged only in negotiations. [An HON. MEMBER: "What about law-making functions?"] Yes, it is also to some extent a lawmaking body. It has been an increasing development in the last few months that when the Heads of Government meet the Commission leaders are present, and when the Heads of Government take a decision the Commission representatives go away and try to work out how best it can be carried out.
    As for meetings in public, whether of the Council of Ministers or of Heads
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    of Government, I can see certain advantages for the entertainment media. I have a feeling that the fight put up there for national interests would cause those meetings to go much further into the night and, indeed, to take more days than they do at present.
    Mrs. Winifred Ewing: Does not the Prime Minister think that the Council of Ministers would be more democratised if his right hon. Friend the Secretary of State for Scotland were to attend it regularly in view of his known anti-Market views and considerable responsibilities for many aspects of decision-making in respect of 5 million Scottish citizens?
    The Prime Minister: I assure the hon. Lady that if there were any meetings at which the interests of Britain, of this House or of Scotland would be best served by my right hon. Friend attending, he would certainly go.
    Mr. William Hamilton: Does my right hon. Friend agree that it is just as important, if not more so, to democratise the European Assembly and to make the Ministers accountable to that body as well as to respective national legislatures? Will he say when he will be in a position to make a statement on the possibility of a firm Government view on direct elections to that Assembly?
    The Prime Minister: Not yet, Sir. But my hon. Friend will be aware that, within a few hours of the result of the referendum being known, I said in public that the Government would be making a recommendation to the Parliamentary Labour Party that we should now take up the scats available to us in that Assembly. My hon. Friend will be aware of the decisions taken by my Labour colleagues which should lead to the selection of Members later this week to attend the Assembly. This is now taking place.
    Changes in the powers of the Assembly require deep consideration. My hon. Friend will know that these matters have been continually discussed in Strasbourg and also that the Belgian Prime Minister, who is coming to this country in the very near future, has been charged by his fellow Heads of Government to make proposals about future political developments within the Community.
    Mr. Hurd: From a United Kingdom point of view, would not the best way of making the Council of Ministers more democratic be to allow this House better opportunities to discuss EEC matters with the Ministers concerned instead of our having perfunctory debates in the middle of the night, which is all the Lord President has so far allowed us?
    The Prime Minister: This is a difficult problem. Nobody is satisfied with the present position. We now have available to us the report of the Select Committee which has made certain suggestions. I should point out that the Labour Government have allowed considerably more time—I appreciate that it is not to everybody's satisfaction, and admittedly the debates take place late at night—than was allowed by the Conservative Government in debating subordinate European legislative proposals.
    Mr. Heffer: Since the Paris statement issued last December by the Heads of Common Market States indicated that it was unanimously agreed that the veto was likely to be undermined in future, and secondly that the permanent representatives were to get greater powers, will my right hon. Friend say whether there will be resistance by the British Government to both these suggestions?
    The Prime Minister: No, Sir. I think I have already answered that question. Following my statement after the Paris summit last December, the reference in the communiqué to the veto was simply a declaration that so far as possible we would not use the veto unnecessarily. That was what it was really about. There had been occasions in meetings of specialised bodies where the veto had been used rather frequently and where, after consideration and reference back, the matter had not been pursued. But nobody said anything at the summit—I did not do so and the communiqué did not record any such decision—to imply that the unanimity rule was breached in any way or that the right of what my hon. Friend calls the "veto" had disappeared. The situation is exactly as it was in that respect. But it was felt that the veto had been used a little too much, particularly in specialist gatherings.

    SCOTTISH ESTIMATES
    Ordered,
    That the Estimates set out hereunder be referred to the Scottish Grand Committee:
    Class VII, Vote 2, Housing (Scottish Development Department).

    Class VIII, Vote 4, Other Environmental Services &c., Scotland.
    Class XI, Vote 3, Social Work, Scotland.
    Class XIII, Vote 22, Other Services: Scottish Office.
    Class XVII, Vote 2, Rate Support Grant to Local Revenues, Scotland.—[Mr. Edward Short.]

QUESTIONS TO MINISTERS
Sir John Hall: On a point of order, Mr. Speaker. It is becoming increasingly apparent that unless one has tabled a Question within the first three Questions to the Prime Minister, it is becoming impossible to have one's Question answered. Is it not possible to limit or discourage the length of answers, or to limit the number of supplementary questions—or, alternatively, without wishing to be accused of masochism, may I suggest increasing the length of time available for Prime Minister's Questions, otherwise many of us who wish to question the right hon. Gentleman will have no opportunity to do so?
Mr. Michael McNair-Wilson: Further to that point of order, Mr. Speaker. You may have noticed that when Parliament was to be broadcast one of the articles in Radio Times suggested that about 15 Questions could be expected to be taken on Tuesdays and Thursdays—I am referring to ordinary Questions rather than to Questions to the Prime Minister—and 20 Questions on Mondays and Wednesdays. Is this now your ruling, Sir, or can we hope that perhaps a rather higher number of Questions can be taken in future?
Mr. Greville Janner: Further to that point of order, Mr. Speaker. When reviewing the policy of Questions to the Prime Minister, will you also review the ridiculous convention which ensures that we have to ask strange Questions in order to have any hope whatever of their even being answered?
Mr. Tapsell: Further to that point of order, Mr. Speaker. May I put a slightly

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different point of view—namely, that many of us feel that the increasing wish of the Chair over the years to take Question Time as fast as possible, and the practice which has tended to grow up in recent years that no backbencher is ever allowed a second supplementary question, works very much to the benefit of Ministers of the day, and that we do not wish to see Question Time taken any faster than it is at present?
Mr. Skinner: Further to that point of order, Mr. Speaker. In view of the exchanges which have already taken place, will you take it from me that I take the opposite view, because I tend to get the impression that Question Time is pretty much as it has been over the past five years? In contrast to the point made at the beginning of these exchanges, could I remind the House that today Questions Q1, Q2 and Q3 to the Prime Minister were taken with Q19, which is in my name, because Mr. Speaker had the good sense to link it with 01, though the Prime Minister had refused to link it in accordance with previous rulings? Therefore, on this occasion, Mr. Speaker, I think that you can leave well alone.
Mr. Cormack: Further to that point of order, Mr. Speaker. Does it improve one's chances of being called if one does not wear a tie?
Mr. Tebbit: Without attempting to take sides on this issue, may I suggest, Mr. Speaker, that you look back on the number of Questions that have been answered at different times? You may find that when the Prime Minister was away and the Lord President was answering, we dealt with Questions very swiftly and on several occasions my hon. Friends and I actually received answers.
Mr. Fairbairn: Further to that point of order, Mr. Speaker. As the Prime Minister has studiously avoided answering any Questions, perhaps I may suggest that his Question Time should be shortened rather than lengthened.
Mr. James Johnson: Without taking sides in this matter and without stigmatising any hon. Member, is it not a historical fact, Mr. Speaker, that years ago we dealt with 80 and sometimes 90 Questions daily and that on one historic occasion we reached three figures?
Mr. Cryer: Further to that point of order Mr. Speaker. May I congratulate the Leader of the Opposition on playing her part by asking a few questions as possible?
Mr. Kelley: On a point of order. Mr. Speaker. My right hon. Friend the Prime Minister has evaded an important question about matters which are likely to be dealt with at a late hour of this day namely, the 12 Members of this House who are to be selected by a body which is not constituted as part of this House to represent the opinions of this House in the European Assembly. I should like to know why we have not been allowed to ask questions about this matter and whether there will be an opportunity to do so on a future occasion?
Mr. Speaker: That is rather a different point of order.
First, I shall deal with the various points of order about Question Time. The one sound answer is: short questions and short answers. However, the idea that the House of Commons can discharge its duty of questioning the executive by dealing with Questions very quickly makes matters very easy for Ministers. The fewer the supplementary questions, the quicker we go and the better it is for Ministers. I have always taken the view that one should try to probe the position of Ministers even if it means four or five supplementary questions. The mathematical argument about getting through 40 Questions, for example, with Ministers getting away with it apparently without having to give an answer at all, is not the right solution. I speak as one who answered Questions for quite a long time.
The Prime Minister (Mr. Harold Wilson): Further to the point of order raised by my hon. Friend the Member for Don Valley (Mr. Kelley) about the European Assembly, Mr. Speaker. It is a matter for this House because the list has to be approved by this House. It has long been understood in relation to both the Council of Europe and other overseas assemblies that the names are selected by the individual parties concerned, but they require approval by this House and this will happen in this case.
Mr. Speaker: May I conclude what I was trying to say? The possibility of lengthening the time for Prime Minister's

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Questions is a matter for the House and not for me. It may have been noticed that today I prolonged Prime Minister's Questions by seven minutes.

PRICES AND INCOMES BOARD
3.45 p.m.
Mr. David Steel: I beg to move,
That leave be given to bring in a Bill to re-establish a Prices and Incomes Board.
The history of legislation on the question of statutory control over prices and incomes is a somewhat chequered one. The 1966 Prices and Incomes Act of the then Labour Government was supported throughout from the Liberal benches and at one point, during a crucial stage of the passage of that Bill, it was supported by us when our votes were essential because it was opposed by both the Conservative Opposition and a section of the Labour Party led by the right hon. Gentleman who is now the Secretary of State for Employment.
However, the passage of that Act and the creation of the Prices and Incomes Board under the chairmanship of a former Member of this House, Mr. Aubrey Jones, increasingly established a national reputation over the years during which it was in existence. It was, therefore, sad and foolish that the incoming Conservative Government of 1970 abolished the Prices and Incomes Board just at a time when it had achieved a national reputation and when it could have been of real assistance to that Government in controlling inflation.
However, within a couple of years the Conservative Government had repented of their folly, and they introduced the Counter-Inflation Act. They could not, of course, without losing face, recreate the Prices and Incomes Board, so they established instead a Price Commission and a Pay Board—two separate bureaucracies. Then the incoming Labour Government in February 1974 abolished the Pay Board.
We have to look at the situation as the country faces it today, and, as we have just heard during Question Time, there is a growing view in all parts of the House that it is high time the Government took positive action to attempt to control inflation.
I am encouraged in seeking leave to introduce the Bill by the words of the Prime Minister, when he was Leader of the Opposition, when he appeared on the

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BBC television programme "Twenty-four Hours" on 2nd March 1972. He said:
"A million unemployed: we cannot solve this without having some kind of anti-inflationary policy. We"—
meaning the Labour Party—
"would reinvoke our powers, the PIB."
Unfortunately, the Labour Government have not yet reinvoked those powers. My Bill is simply an opportunity for them to do so, because we have to look at the situation today in which, under the Healey formula—which was found so convenient at the last General Election—inflation is now running at a rate of 30 per cent., and in which most commentators believe that we are heading for an unemployment figure of over 1 million by the end of the year—the million which the then Leader of the Opposition thought was significant.
Most Governments are accused of promising jam tomorrow and never providing it today. This Government have stood that on its head. They threaten no jam tomorrow, and watch everyone helping themselves to large dollops of it today. Action is now required, and the Bill simply paves the way for a reintroduction of statutory controls over price increases and income increases.
The Board which the Bill would set up would have the powers which the old board had—that is, to undertake, at the request of the Government, specific investigations into areas of income; for example, the lower paid in certain industries. It would also have powers to receive specific remits from the Government.
We consider that it is the responsibility of the Government to take the political decision to say what percentage of growth either in prices or in incomes can be afforded by the country at any one moment. Those limits having been set, we would give powers in the Bill to Secretaries of State to refer to the Prices and Incomes Board any proposed increases which went above the norm set down by the Government at any time. The board would then undertake an investigation and would make a recommendation to the Government either to make exceptions or to restrict the increases to the figures already established by the Government.
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At the end of the day the Government, who are responsible to this House, would take the decisions. In that respect the board would differ from the Pay Board established by the Conservative Government under the Counter-Inflation Act. The matter would remain a matter for political decision by the Government.
The Bill would be helpful in creating the machinery to establish a fair, expert and authoritative body which would help the Government when they finally come round to establishing statutory controls over price and income increases.
This House can delay no longer, and the Bill is happily timed to set up the necessary machinery.
3.50 p.m.
Mr. John Tomlinson rose——
Mr. Speaker: Does the hon. Gentleman wish to oppose the motion?
Mr. Tomlinson: Yes, Mr. Speaker.
I rise to ask the House to refuse leave for the introduction of a Bill to re-establish a Prices and Incomes Board. From what the hon. Member for Roxburgh, Selkirk and Peebles (Mr. Steel) said, it is clear that he fully intends, if the Bill receives the leave of the House, not merely to reinvoke a Prices and Incomes Board but to endow it with all the rigmarle of statutory controls. He has said clearly that the proposed board would have powers of statutory control of prices and incomes. It is indicative of the fact that hon. Members who are supporting the hon. Gentleman and his Bill have learned nothing from the last 10 years that they seek the leave of the House to introduce such a Bill.
If we examine what has happened during the two periods when we have had statutory control of incomes, we find in those two periods the very causes of the kind of wage-led inflation we are experiencing today. For example, during the period of the previous Labour Government's incomes policy, one which many of my right hon. and hon. Friends supported at that time, we find that statutory control appeared to have worked particularly well in the public sector, but, while it was apparently working well there, there was a drift of wage

245
increases of about 6 per cent. in excess of the norm in the private sector.
At the end of the period 1966–70 we found that the whole pattern of industrial disputes had changed. We found that the people who were getting involved in industrial action were people who had never resorted to such action in their history. We found that these were local authority manual workers, gas workers, Post Office workers, National Health Service employees, civil servants, teachers, and railway men—I could go through a long list—and every one of them in the public sector. The reason why we had that range of public sector disputes was that the incomes policy worked satisfactorily in the public sector according to the criteria laid down but it left the public sector far behind other areas of employment in the community.
It was then, when we had the massive round of industrial disputes, that we still found that during the period of operation of a statutory policy by the Conservative Government public sector employees got left behind. The reason why we had massive settlements for teachers, following the Houghton Inquiry, and for nurses, after the Halsbury Report, is that the statutory mechanisms of control could not adequately deal with the public sector.
I also ask the House to oppose the motion not only because what lies behind it does not work but because it involves a self-deluding process. If we imagine that merely by creating a statutory body we shall be getting a panacea which will deal with many of the things about which the hon. Member for Roxburgh, Selkirk and Peebles spoke—problems of inflation, of employment and of productivity—we are deluding the vast majority of the people as well as seeking to delude ourselves in the process.
I ask the House to acknowledge that the way that we shall deal with the problems of inflation is by grappling with the real problems of getting more productive wealth and establishing systems of industrial relations that get management, labour and capital to work more effectively together. We shall not do that by the mechanism of an industrial policy which has been directly responsible for industrial disputes.
I ask the House to reject the motion.
Question put, pursuant to Standing Order No. 13 (Motions for leave to bring in Bills and nomination of Select Committees at commencement of Public Business):—
The House divided: Ayes 28, Noes 162.

Division No. 244.]

AYES

[3.54 p.m.

Biggs-Davison, John

Knox, David

Tapsell, Peter

Ewing, Mrs Winifred (Moray)

Lewis, Kenneth (Rutland)

Thorpe, Rt Hon Jeremy (N Devon)

Freud, Clement

Meyer, Sir Anthony

Wainwright, Richard (Colne V)

Grimond, Rt Hon J.

Morgan, Geraint

Watt, Hamish

Grist, Ian

Nelson, Anthony

Wigley, Dafydd

Hawkins, Paul

Newton, Tony

Young, Sir G. (Ealing, Acton)

Hooson, Emlyn

Page. Rt Hon R. Graham (Crosby)

Howells, Geraint (Cardigan)

Penhaligon, David

TELLERS FOR THE AYES

Irving, Charles (Cheltenham)

Ross, Stephen (Isle of Wight)

Mr. A. J. Beith and

Johnston, Russell (Inverness)

Steel, David (Roxburgh)

Mr. Cyril Smith.

Kelley, Richard

Stewart, Donald (Wesern Isles)

NOES

Allaun, Frank

Cant, R. B.

Ellis, John (Brigg & Scun)

Anderson, Donald

Carter-Jones, Lewis

Evans, John (Newton)

Archer, Peter

Clemitson, Ivor

Ewing, Harry (Stirling)

Ashley, Jack

Cocks, Michael (Bristol S)

Fernyhough, Rt Hon E.

Ashton, Joe

Cohen, Stanley

Flannery, Martin

Atkins, Ronald (Preston N)

Conlan, Bernard

Fletcher, Ted (Darlington)

Atkinson, Norman

Cook, Robin F. (Edin C)

Foot, Rt Hon Michael

Bagier, Gordon A. T.

Corbett, Robin

Ford, Ben

Bates, Alt

Cormack, Patrick

Forrester, John

Benn, Rt Hon Anthony Wedgwood

Cox, Thomas (Tooting)

Garrett, John (Norwich S)

Bidwell, Sydney

Cryer, Bob

Garrett, W. E. (Wallsend)

Biffen, John

Cunningham, G. (Islington S)

Gow, Ian (Eastbourne)

Booth, Albert

Dalyell, Tarn

Grocott, Bruce

Bray, Dr Jeremy

Davies, Bryan (Enfield N)

Hamilton, James (Bothwell)

Brown, Hugh D. (Provan)

Davies, Denzil (Llanelli)

Hamilton, W. W. (Central Fife)

Brown, Robert C. (Newcastle W)

Davis, Clinton (Hackney C)

Hardy, Peter

Buchanan, Richard

de Freitas, Rt Hon Sir Geoffrey

Harrison, Walter (Wakefield)

Budgen, Nick

Dempsey, James

Hatton, Frank

Callaghan, Jim (Middleton & P)

Dunnett, Jack

Hayman, Mrs Helene

Campbell, Ian

Dunwoody, Mrs Gwyneth

Heffer, Eric S.

Canavan, Dennis

Edwards, Robert (Wolv SE)

Hooley, Frank

Hordern, Peter

Maynard, Miss Joan

Spriggs, Leslie

Hoyle, Doug (Nelson)

Mellish, Rt Hon Robert

Stallard, A. W.

Huckfield, Les

Mendelson, John

Stewart, Rt Hon M. (Fulham)

Hughes, Mark (Durham)

Miller, Dr M. S. (E Kilbride)

Stoddart, David

Hughes, Robert (Aberdeen N)

Mitchell, David (Basingstoke)

Stott, Roger

Hunter, Adam

Morris, Charles R. (Openshaw)

Taylor, Mrs Ann (Bolton W)

Janner, Greville

Newens, Stanley

Thomas, Jeffrey (Abertillery)

Jeger, Mrs Lena

Oakes, Gordon

Thomas, Mike (Newcastle E)

Jenkins, Hugh (Putney)

Orbach, Maurice

Thomas, Ron (Bristol NW)

John, Brynmor

Ovenden, John

Tierney, Sydney

Johnson, James (Hull West)

Page, John (Harrow West)

Tinn, James

Jones, Alec (Rhondda)

Park, George

Tomlinson, John

Jones, Dan (Burnley)

Parker, John

Torney, Tom

Judd, Frank

Pavitt, Laurie

Tuck, Raphael

Kaufman, Gerald

Pendry, Tom

Wainwright, Edwin (Dearne V)

Kerr, Russell

Powell, Rt Hon J. Enoch

Walker, Herold (Doncaster)

Kilroy-Silk, Robert

Prescott, John

Walker, Terry (Kingswood)

Kinnock, Nell

Price, C. (Lewisham W)

Ward, Michael

Lambie, David

Radice, Giles

Watkins, David

Lawson, Nigel

Richardson, Miss Jo

Watkinson, John

Lewis, Arthur (Newham N)

Roberts, Albert (Normanton)

Weitzman, David

Lewis, Ron (Carlisle)

Roderick, Caerwyn

Wellbeloved, James

Lipton, Marcus

Rodgers, George (Chorley)

White, Frank R. (Bury)

Litterick, Tom

Roper, John

Whitehead, Phillip

Lomas, Kenneth

Sandelson, Neville

Whitlock, William

Loyden, Eddie

Sedgemore, Brian

Williams, W. T. (Warrington)

McElhone, Frank

Selby, Harry

Winterton, Nicholas

Mactarlane, Nell

Shaw, Arnold (liford South)

Wise, Mrs Audrey

Mackenzie, Gregor

Sheldon, Robert (Ashton-u-Lyne)

Woodall, Alec

McNamara, Kevin

Short, Mrs Renée (Wolv NE)

Young, David (Bolton E)

Madden, Max

Sillars, James

Mahon, Simon

Silverman, Julius

TELLERS FOR THE NOES:

Marks, Kenneth

Skinner, Dennis

Mr, Joseph Dean and

Marshall, Jim (Leicester S)

Snape, Peter

Mr, John Golding.

Mason, Rt Hon Roy

Question accordingly negatived.

ORDERS OF THE DAY

  SUPPLY
  [21ST ALLOTTED DAY]—considered.
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. John Ellis.]

ROYAL AIR FORCE
4.5 p.m.
Mr. Cranley Onslow: It has been the tradition of recent years that our regular debates on the Estimates of the three Services do not end in a Division pressed by the official Opposition. As that tradition is likely to be broken this evening—unless the Government prove a good deal more amenable to argument on the subject of defence than they have so far been—I should explain why we on the Opposition side are so concerned about the present and prospective state of the Royal Air Force and why we feel we must press this motion in the Lobby tonight.
I hope the House will forgive me if in so doing I go over some of the ground covered in the debate on the Defence White Paper on 6th and 7th May. It is helpful in one way that the Government have just issued a pamphlet which might be called a mini-White Paper. All hon. Members will have a copy. I have mine here with its covering letter which describes the document as
"a pamphlet on British Defence Policy and the rôle of the Services. It provides selected information from my Defence White Paper"—
says the Secretary of State—
"in a popular form, and has been distributed to schools, universities and young people generally…. The aim is to interest not only those who might join the Services but to inform them about the Government's Defence Policy."
I have no quarrel with the first of these aims or with the pamphlet itself, which seems to be excellently produced, but, having read it carefully, I am tempted to suggest that some, at least, of the £1,764 which it is costing the taxpayer should be debited to Transport House because it repeats the same somewhat complacent, somewhat misleading statements of self-justification with which
250
Ministers now try to sell their new defence policy to the nation.
We are told in the pamphlet once again that if the country's annual expenditure on defence is reduced to 4½ per cent. of the gross national product this will be more in line with the spending of our major European allies. We are told that the changes proposed in the new policy are being made in close consultation with all our allies, and we are told, finally, that the defence review emphasises the importance that the Government attach to the continued support of NATO. The object of these words is to persuade the impressionable reader that no one in this country or in NATO questions the reasoning of the Defence White Paper or its purported basis, although we here know that the spurious logic of the GNP argument was totally demolished by my hon. Friend the Member for Ayr (Mr. Younger) in his opening speech in the debate on 6th May.
In that debate the Under-Secretary of State for the Royal Air Force summed up his attitude and that of his hon. Friends in the same way, if not in precisely the same words, as the salesmen of a brand of shaving soap in praising their product: "Not too much, not too little, but just right." The Under-Secretary's argument may have this erasmic quality because he says, the Conservatives say the Government have cut defence too heavily, their friends of the Tribune group claim they have not cut it heavily enough, and therefore
"the middle course which the Government have steered is the only one".—[Official Report, 7th May 1975; Vol. 891, c. 1442.]
In this, for what it is worth, the hon. Gentleman was later supported by the Liberal spokesman, who does not seem to think too clearly about these matters. If he did he would soon see that the Government's self-righteous attitude depends upon the assumption that all the critics of the defence review can comfortably be dismissed as extremists. No doubt the Under-Secretary privately holds that view of his hon. Friends below the Gangway whom I am pleased to see represented here today. In the light of the Pavlovian reactions of the hon. Members for Salford, East (Mr. Allaun) and Birmingham, Selly Oak (Mr. Litterick) to the arrival of American U2 aircraft in this country last month, when they used words

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like "provocative" and "sinister", I shall not waste the time of the House trying to persuade the Under-Secretary that he is wrong in regarding them as extremists or in disregarding them as extremists.
I should like the House to consider the argument from a different and more intelligent point of view—that of our NATO allies. It was a marked feature of our debate on the Defence White Paper in May that almost every Minister who spoke went out of his way to avoid any reference at the Dispatch Box to NATO's reaction to the White Paper. I am glad that the Secretary of State was more frank with the House this afternoon in response to a direct question from my hon. Friend the Member for Ayr and admitted what he had previously been at pains to play down, the serious disquiet which our NATO allies felt, and still feel, at the cuts which the Government have imposed on our defence programme.
But it is worth while and important that the House should be reminded of the full text of the communiqué that was issued by NATO on March 21st, following the Government's publication of their White Paper, Command 5976. This is how the three opening paragraphs of that communiqué read:
"In accordance with the usual NATO practice, the United Kingdom Government, having reached provisional conclusions on their Defence Review, initiated the process of consultation with their NATO allies in December 1974. The implications of the changes proposed have been assessed by the NATO military authorities and there have been several exchanges of views in the Defence Plan Committee of the Alliance. These took place against the background of a statement that the British Government regarded their plan to reduce defence expenditure to 4½ per cent. of gross national product by the middle 1980s as a firm decision. The Alliance welcomes the assurance that NATO commitments remain the first charge on British defence resources; that no reductions are envisaged in advance of an MBFR agreement in the forces deployed in the Central Region; and that the United Kingdom will maintain the effectivenes of its present strategic and tactical nuclear contribution to NATO. The Alliance has nevertheless expressed its disquiet at the scale of the reductions proposed and their effect on NATO's conventional defence vis-à-vis the increasing capability of the Warsaw Pact. The changes of special concern are: the reduction of reinforcement capability in the Northern and Southern Regions; the removal of naval and air forces from the Mediterranean area; and the decline in maritime capabilities in the Eastern Atlantic and Channel areas."
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The House reading between the diplomatic lines, will agree that that statement is highly critical. It expresses a criticism of the action of Britain as a partner in the alliance which ought to have been taken very seriously by the people of this country, if the Government were not prepared to take it seriously; and I fear it is a criticism that remains as valid now as it was when it was expressed. It is certainly not a statement that substantiates any claim at all by the Secretary of State or his colleagues that our allies think that our Defence Ministers have everything dead right.
It is on the basis of that NATO statement that I want now to try to identify the respects in which we find Government policy for the future of the Royal Air Force quite unacceptable.
The first is the reduction in our whole maritime capability which must flow from the drastic cut in the Nimrod force by 25 per cent. It is hardly necessary for me to remind anyone who takes an interest in these matters of the vast increase in Soviet naval forces in the past five years or so. Even hon. Members below the Gangway will have noted this Nor do I need to spell out the threat that this represents. I am sure that the Secretary of State understands it, and I hope his endeavours to make sure that the country understands it are not frustrated by anyone on his side of the House. We on this side will certainly not frustrate him in that.
It is worth recalling the comments made by General Steinhoff in March 1974, after he had served for three years as Chairman of the NATO Military Committee. I take these comments from the June 1974 issue of the NATO REVIEW:
"The growing Soviet strength at sea is possibly the most important military-political development of the second half of this century … I am almost more alarmed by Soviet power politics at sea than by the confrontation in Central Europe."
Those remarks are a year out of date now but they have certainly lost none of their force in the interval, and, since the NATO communiqué uses the word "increasing" of the Soviet naval strength, we can assume that the picture as General Steinhoff painted it has become darker in the intervening months.

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Is it not astonishing that in the light of such comments the Government can ever have contemplated discarding one quarter of the Nimrod force, which is an integral feature of our maritime capability, particularly when we realise that the British contribution to NATO's maritime armoury is the most crucial of all the European partners in the alliance? Does not it become more extraordinary still when we recognise that
"the key to the deterrent power of our armed forces is our ability to obtain early warning of an enemy's intentions through reconnaisance, and to strike at his offensive forces from a distance in case of need"—
to quote from the White Paper on defence produced by the Labour Government in 1966, when they were able to take a more intelligent view of these matters? I put that point to the House with all the more conviction since I have recently had the good fortune to see how accurate and effective a weapon system Nimrod provides—and I must express my thanks to the Under-Secretary of State for Defence for the Royal Air Force for his part in making it possible for me to do so, and my thanks to all concerned at RAF Kin-loss, and, in particular, to No. 7 crew of 206 Squadron, who, I shall see to it, will get a complimentary copy of the Official Report.
So there is the first inexcusable decision.
The second comes in the proposals to leave the RAF with wholly inadequate resources, after the cut of 50 per cent. in the transport fleet, to meet NATO's needs for tactical reinforcement and mobility. I am content to leave aside this afternoon the fact that all the Comets and Britannias are apparently to be sold. More worrying for my immediate purpose is the fact that all the Andovers are also to be disposed of, and that the Hercules fleet is to be reduced to 40 aircraft, although we do not know the Government's intentions so far as the disposal of any surplus Hercules aircraft are concerned. This was curiously omitted from the Answer to a Parliamentary Question that was put down last week.
The RAF helicopter tactical transport force will also be reduced by about a quarter, and this in its turn must have a very serious impact on the mobility of the Army, even if the cut appears to be
254
in part explained by a decision not to order medium-lift helicopters which have not in fact been ordered anyway. Disregarding that, we on this side of the House must once again endorse the reactions of our NATO allies. For my part, I must add that one of the most extraordinary parts of those cuts is that no attempt seems to have been made to consider the possible creation of reserves to compensate, if only partially, for the cuts in the front-line capability.
I put to the Minister and the House the question: is it really impossible, for instance, to expand the strength of the Royal Auxiliary Air Force in a situation such as this? We are told that the RAAF now consists of maritime units which would be required to support Regular formations in an emergency. The Defence White Paper also reminds us that the RAAF celebrated its fiftieth anniversary on 9th October last year. But in paying tribute, as I do, to the record of glorious achievement of that force over the past 50 years, I must put on record that its strength now totals 238 officers, airmen and airwomen, a figure which is almost exactly half what it was 10 years ago and very much below the strength it had when it rendered its greatest services, a strength to which I believe it could be restored if the Government would recognise the need to build up an adequate reserve.
Mr. Tam Dalyell: Before the hon. Gentleman goes too far from that point, has he calculated the cost in terms of fuel, apart from anything else, of an enlarged Air Force reserve? All these people have to be kept up to current training standards, and, in terms of fuel, that is extremely costly. It is very easy to suggest that but training is vastly costly.
Mr. Onslow: I hope I may be able to help the hon. Gentleman. I hope he will concede that there is no shortage of surplus aircraft, whether military or civilian types. The hon. Gentleman may know, if he has read the answer to a Question that I put down last week, that the Ministry of Defence is already spending £2 million a year on civil air charter contracts, to North-West Europe, Berlin and Australia and in Nepal. Does he consider it out of the question that a

255
scheme might be worked out, using surplus aircraft or dry-leasing civil aircraft, which would enable a reserve of skilled transport pilots to be built up and preserved and kept in practice, flying what are evidently essential military tasks which will be paid for anyway?
If the hon. Gentleman finds it extraordinary that such a proposition should be put forward, perhaps he does not realise that it is something which our American allies have been doing for some time. I would not dismiss out of hand as either hopelessly expensive or hopelessly impracticable a scheme of that kind, which would enable a working reserve to be brought into being.
Mr. Norman Tebbit: I very much agree with my hon. Friend. This is done in the United States in the Air National Guard. The Americans also have means of using such people in their coastguard. There is no reason why we should not have a Royal Auxiliary Air Force helicopter squadron. These things could be done very inexpensively compared with the Regular Forces or even commercial companies doing them.
Mr. Onslow: I am grateful to my hon. Friend for reinforcing my point. My experience of the civil helicopter work done by charter companies in coastguard operations does not suggest that the service would be in any way inadequate if it were taken away from the Regular arm and handed over to an active reserve. I hope that the Minister will agree that this sort of question should be examined thoroughly and quickly.
In the meantime, the RAF is being left virtually without reserves. This is wholly unacceptable at a time when the strength of the Services is being run down by no less than 18 per cent. Against this alarming background, with the prospect of further defence cuts as ominous as it is now, and remembering that we have yet to hear how the cuts of £110 million announced in the Budget are to affect the RAF or the other Services, I still do not believe that what we seek is beyond the nation's resources. I am not saying that there must not be cuts in defence, that every aircraft must be retained and that every RAF station must be kept in being—far from it. My argu-
256
ment is confined to the Government's own chosen ground, our contribution to NATO.
Labour Members should not seek to answer the case by introducing inflated or unrealistic costs and plans which I am not advocating. But if the Minister's response is simply that it must be a matter of share-and-share-alike when it comes to cuts, we cannot accept that attitude either. In our view there is a point at which defence can no longer be cut if it is to remain credible. NATO has already made it clear that this country has not merely reached that point but has passed it.
In the last resort—and that seems to be where this unfortunate country has been driven by this most inept of Governments—defence must have priority over less crucial spending.
Mr. Stanley Newens: Will the hon. Gentleman make the Position of the Opposition quite clear? Is he saying that more should be spent on defence than is being spent now? If a Conservative Government were in power, would they step up the amount spent on defence compared with that spent by the present Government? Would the hon. Gentleman therefore be prepared to have additional cuts in other public service expenditure?
Mr. Onslow: I am sorry to have expressed myself so badly that the hon. Gentleman appears unable to understand me. What I said was that there was a point beyond which defence could no longer be cut if it was to remain credible, and that it is NATO's opinion that this country has not merely reached that point but passed it, and that we agree with this proposition.
If the hon. Gentleman is seeking to suggest that that inevitably means that the only possible source of extra funds to redress the deficit on defence is the National Health Service or something of that kind, I must remind him, as I reminded him when we last debated the matter, that there are some other candidates for the chop which come much higher in the list of priorities. Nationalisation is one, whether the hon. Gentleman likes that or not. There are priorities which must be got right. I am sorry to have had so little success this afternoon in persuading the Secretary of State that it is more important to maintain the

257
strength of Europe's aero-space industry than to waste time and money in fooling about with nationalisation.
Mr. Newens: The hon. Gentleman is dodging the question.
Mr. Onslow: If the hon. Gentleman will do me the kindness of reading what I have said today and recalling what I have said previously, I do not think he will feel that the question has been dodged. If he does not like the proposition that less money could be spent on nationalisation, I am sorry for him, but the electors of West Woolwich are more likely to agree with me than with him.
We condemn the Government again today because their policy has put the security of the United Kingdom and the integrity of NATO in grave jeopardy. More than that, we condemn them because they have persisted in judging the scale and nature of our contribution to NATO in financial terms, rather than
"in terms of its total value to deterrence and defence throughout the Alliance".
Those are the words of the NATO statement. I believe that the Government have so weakened the conventional strength of the alliance that the scope for flexible response has been reduced.
If that is so—and the flexible response has been the aim of the alliance in recent years—there must be a corresponding increase in the danger that any conventional conflict or confrontation may escalate into a nuclear one. That brings us back to the days of the tripwire theory, with all that that entails. I hope that even the hon. Gentleman, who is so concerned with costings in these matters, will not welcome any development, particularly if his Government are responsible for it, which brings us closer to the danger of a nuclear conflict. Those are the reasons why we shall divide the House tonight unless the Government are able to satisfy us.
Before leaving the subject of money, I asked the Minister to clear up the matter of offset costs of British forces in Germany. The Under-Secretary of State for Defence for the Army told us this afternoon that this was a matter to be taken into consideration fairly soon. I was not clear what that meant, although I hope that the House accepts the need for action
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to be taken when we bear in mind the effect on the costs of our forces in Germany of the fall in the value of the pound, a matter that was underlined by my hon. Friend the Member for Beckenham (Mr. Goodhart). When can we expect a clear statement of the position, and particularly the effect of this increased cost, on the money available to the defence budget?
I turn briefly to other serious matters which concern the RAF and which I know some of my hon. Friends are anxious to raise in the debate. The first is the subject of procurement, and in particular the status of three projects that are vital to the future capability of the RAF—the MRCA, the airborne early warning requirement and the short-range air-to-air missile.
Can the Minister tell us what decision has been reached about an air-defence version of the MRCA? Can he expand upon his earlier answers about technical teething troubles? What is the effect on costs of the proposed slow-down by one-third in the delivery rate to the RAF? How far have our talks with our German and Italian partners got on securing that slow-down?
Why is the RAF apparently to be the only air force without a short-range high-g missile for air-to-air combat, or can it look forward to the placing of an order fairly soon?
On the subject of airborne early warning, what is being done to ensure that the fullest consideration is given in NATO to the development of a Nimrod-based AWACS system, which would by all accounts be a much cheaper and entirely adequate alternative to the Boeing E-3A project?
Those questions bring me straight to my next main point, which concerns defence sales. My hon. Friend the Member for Ayr has described the situation here as a complete shambles. If it is not a complete shambles, the House has certainly no information on which to base a conclusion, because it is extraordinarily difficult to obtain hard or worthwhile information from Ministers about anything connected with defence sales. I realise the difficulties of confidentiality and commercial negotiations. However, I should have thought that the Government might have been ready to be as

259
forthcoming to the House as they appear to expect the rest of industry to be to the world at large under the provisions of the Industry Bill.
Please may we soon have a statement on accountability in defence sales? It may be in the form of a White Paper, but certainly we want a statement—not just as sauce for the gander but so that we can know the standards by which the Government and their agents, MODPE, are prepared to be judged, and the objectives that they have set themselves. Unless and until we know that, the House can do nothing to exercise its duty of trying to keep the administration up to the mark. I fear that we are operating in a vacuum, with all the undesirable consequences that flow from that.
In the meantime, may we please have from the Minister today a clear outline of the relationship, as the Government see it, between the search for standardisation in equipment purchases by NATO and the preservation of a British or a joint European industrial capability in the developing technology of defence equipment of all kinds? There are openings here which must not be missed. It is even possible that the outcome of the so-called "Sale of the Century", with the contract going to an American firm for the Starfighter replacement, will be that there is a French requirement for the MRCA. It is doubtful, to say the least, whether the Eurogroup has the authority or, indeed, the political momentum to operate successfully in this very difficult area.
I believe that part of the reason why MRCA did not get the fullest possible consideration in a strip-down version, or whatever, in the recent competition was that there was nobody there who was really charged with seeing that all the facts were put forward at an early enough stage to keep the project in contention. It is no use bringing it forward at the last minute—it should have been there at the first. I am sure that this important subject will be raised again and again today by Opposition Members, if not Labour Members.
I turn to another subject which in its own way is just as vital, namely, the current state of the morale of the RAF and particularly of those who are facing
260
the bitter prospect of redundancy. The Defence White Paper tells us that there are to be 4,000 RAF personnal made redundant in the next 18 months or so, including 800 officers. A high proportion of these must be transport aircrew, not helicopter pilots who I understand have been told that they may not even apply for redundancy even though there is to be a 25 per cent. cut in RAF rotary-wing aircraft strength. Very few of them can have any hope of finding civilian jobs in aviation, at least in the air—although they may be able to get jobs on the ground.
Dealing with flying, we know that there is already a world surplus of airline pilots. There are a great number of ex-Court Line pilots who are still unable to return to a flying career and there is some doubt whether some of them will ever be able to do so. The White Paper tells us:
"Full facilities for resettlement advice and assistance will be promised for those returning prematurely to civilian life."
That is an unlovely phrase. It is vital that these facilities should be really effective. We owe a moral debt to the men whose chosen careers are to be destroyed. This debt must be paid in full, not merely for their own sake or for that of their families, but for the morale of the Service as a whole and the reputation of the House as their employers.
This is a matter which has already caused concern to my hon. Friend the Member for Mid-Oxon (Mr. Hurd) and to other hon. Members who have RAF stations, such as Brize Norton and Thorney Island, in their constituencies. Those hon. Members may find it rather ironic that the Armed Forces of the Crown are evidently the only areas of public employment where overmanning is not tolerated, let alone encouraged. It may be right that the judgment should be as it has been in this case, but if it has to go that way there is most certainly a duty which must be discharged, and we look to the Minister to tell us this afternoon what he has done and what he intends to do—it may be that this will need to extend over a year or so ahead—to keep faith in this matter and to ensure that those who are to be declared redundant get the fullest possible chance of a second start in their working lives.

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Only two matters remain. First, I should briefly but sincerely like to commend the Secretary of State on his success in persuading his Cabinet colleagues to approve the order of Harriers for the Navy. I realise that discussion of this should be deferred until we debate the Navy Estimates, but it would be ungenerous of me to miss this opportunity of telling him what a very sensible decision Conservative Members believe he has taken, even if we are not necessarily convinced that it is totally in accord with the strategy in his Defence White Paper. However, that does not make it any the less sensible, and in some respects it makes it even more sensible.
Secondly, I must put on record our sincere thanks to the men and women of the Royal Air Force for all that they have done to serve our country since we last had the chance to debate this Service. In particular, I should like to pay a tribute to all who were involved in the difficult business of the Cyprus emergency. The RAF played a leading part in the relief operations and in the evacuation of British dependents and civilians—as the Defence White Paper says—
"with the highest order of efficiency and professionalism".
It is ironic that the aftermath of those unhappy events has been to leave Akrotiri as one of the RAF's smallest stations when once it was the largest.
However, perhaps that is all the more reason for our praise of those who have served there and everywhere else at home or overseas in the RAF. It is certainly no fault of theirs and no reflection upon them in any way if we find ourselves compelled to vote against the Government tonight.
4.37 p.m.
The Under-Secretary of State for Defence for the Royal Air Force (Mr. Brynmor John): At least at the start of my speech I can find myself in accord with the hon. Member for Woking (Mr. Onslow) in that I should like to record my appreciation of the efforts and achievements of the RAF.
In the 16 months in which I have been in office I have tried to make it my business to visit as many stations and units as I could. I believe that I have succeeded in seeing and speaking to as
262
many as possible of those who are serving in the RAF. Where ever I have visited, whether in Cyprus at the height of the emergency or in recruiting offices, where they have been superintending the entry of further young men into the RAF, the men and women of the RAF have impressed me enormously. They are intelligent, realistic, keen and dedicated and, above all, they are loyal. Though everyone is in some way affected by the uncertainties of the times, I believe that the young men and women who I have met have performed magnificently. In short, we are very lucky to have people of their calibre in our forces.
It must be said—because it is a restatement of positions that the hon. Member for Woking and I have taken up in past debates and will take up in future debates—that we shall not agree on our central view of the rôle of defence in modern society. I know that no one works harder at his spontaneous quips than does the hon. Member for Woking, but he singularly fails to recognise that defence in a modern society is always a combination of, on the one hand, the arms and the forces that are provided to defend that society and, on the other hand, the quality of the society itself. If one is unduly represented at the expense of the other, it fatally weakens the total defence effort.
This is why, as my hon. Friend the Member for Harlow (Mr. Newens) said, it is no good the hon. Member for Reigate (Mr. Gardiner), in weekend speeches, in the vivacious way that we know so well, calling for cuts in public expenditure of £4,500 million, whereas in fact what he is calling for is a cut much nearer £5,000 million, the extra £500 million made necessary to cover the additional proposals for expenditure on defence instead of maintaining the present level of defence expenditure.
Mr. Onslow: To make the position perfectly clear, is the House to understand that in the Minister's view nationalisation is a contribution to the quality of society?
Mr. John: If the hon. Gentleman wants me to be absolutely frank, yes, it is. In any event, it throws a curious light on his ability as a mathematician to suggest that we should immediately make cuts in public expenditure on proposals where

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no money has yet been nor will be expended for some years.
Dr. Alan Glyn rose——
Mr. John: I had hoped that the previous defence debate had in a sense cleared away the more general areas of disagreement and permitted us to look at this particular Service.
Dr. Glyn: Will the hon. Gentleman give way?
Mr. John: I would rather develop this point. I will give way to the hon. Gentleman later, if he wishes.
Inevitably, as I said, the Defence Review has cast its shadow over this debate. I would merely point to the one decision which, in my view, is central to the whole argument today. That is the deliberate choice that we made in the Defence Review that henceforth we would increasingly concentrate our defence efforts where we conceived them to be most important to us—namely, the United Kingdom, the Eastern Atlantic and the Central Region of Europe. I believe that if the correctness of that judgment is accepted, everything which follows for the Royal Air Force is logical. I suspect that, whatever the hon. Member for Woking may say, it is his unwillingness to concede that central judgment which makes him so unhappy this afternoon. It must be so if the Opposition make, as they do, the reduction in the transport force such a central plank in their attack this afternoon.
I repeat that this reduction follows directly from our strategic decision, for so large a transport fleet was rendered necessary by our worldwide rôle. We shall therefore be making a 50 per cent. reduction in the fixed-wing element of this force in the next year, which will bring its total strength down from 115 to 57. The rundown will be synchronised with the withdrawal of forces from overseas and will take full account of the need to support that withdrawal.
The reduction in strength has already begun with the withdrawal from service of five Andovers and six Britannias, which will be followed by the Comets of 216 Squadron at the end of this month. The remaining Andovers and Britannias
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will follow towards the end of this year, and the rundown will be complete in the early part of 1976 with the withdrawal of part of the VC10 force.
Cutting by half, despite what the Opposition may pretend, is not the complete removal of the force, nor of the capability. We shall still have a large and powerful capability led by the remainder of the VC10s together with the Belfasts and, as the hon. Gentleman said, a Hercules fleet of 40 aircraft. I would comment, because it was absent from what the hon. Gentleman said, that, even after the reduction, we shall have the largest transport force amongst our European NATO allies. The Royal Air Force will therefore be able to discharge its future strategic and tactical transport roles. It will, as the hon. Gentleman said, be marginally less able to carry out some of the routine trooping tasks, though much of it will remain an RAF responsibility. We shall, however, be increasing slightly the rôle of civil charter in this area, and one new contract has already been put out to tender. The use of civil charter is not new. Certainly in North-West Europe we have used it for troops and families for some time, so there is no room for criticism on a matter of principle there.
Mr. Cyril D. Townsend: Is the Minister aware that those of us who went on a recent visit to the Royal Air Force in Germany heard on a number of occasions how worried personnel there were at this cut-back in the Air Transport Command, bearing in mind the need to reinforce our troops in Germany quickly? Is it likely that air charter planes will be available at a short notice in an emergency?
Mr. John: As I said, we are talking about routine trooping of troops and families. If the hon. Gentleman will be patient for a moment, I think that I can satisfy him on that point. Basically, I have already assured him that we can carry out our tactical and strategic roles with our transport force.
Looking back at the airlift operations undertaken by the RAF in the last few yeas, I agree with the hon. Member for Woking that the magnificant Cyprus operation stands out as the major transport task. The precision and skill of that operation, which I was privileged

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to witness, earned us the plaudits of the world. I can think of no more graphic illustration of our remaining powerful capability, which we shall retain, than to say that I am advised that we could, if necessary, with a reduced transport force, mount this operation again without significant overstretch. In a large-scale emergency, of course, the RAF can be supplemented from civil resources. But there is nothing new in that. That is enshrined in the Civil Aviation Act, of which the hon. Member for Wokingham and I are fully aware.
I repeat, we retain a transport force which is capable of serving our needs, both actual and foreseen, given the new concentration of resources that we have adopted. I hope that that will take some of the synthetic heat out of hon. Gentlemen opposite.
If, as I have shown, the charge of destroying the capability of the transport force is untrue, there is not a scintilla of evidence to support that charge when the front line in the United Kingdom and Germany is considered. This is the contribution to the defence of the West which will make the greatest impression upon other countries, and it is one upon which I think any responsible Opposition would put most weight.
The present strength of these combat forces is not being reduced at all. Indeed, we are going on with improvements already planned, such as the replacement of the Phantoms by the Jaguars, which will mean that in quantity and in quality our Air Force in Germany will be improved. I do not think that anyone in this House will dispute that the Jaguar aircraft is outstanding amongst the present generation of aircraft in ground attack and reconnaissance rôles.
Coupled with this, the conversion of the Phantoms to the air defence rôle, the modernisation of the tanker force, the plan to introduce an airborne early warning aircraft and improvements in the United Kingdom air defence ground environment will put us in a better position effectively to defend the United Kingdom and the seas around.
Mr. Dalyell: My hon. Friend said that it is planned to bring in an airborne early warning aircraft. Is it to be Nimrod?
Mr. John: It is planned to be introduced. Both the Nimrod and the
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AWACS are being studied as part of the plan to see which is the most effective and most cost-effective aircraft to do the job which we require.
Mr. Dalyell: Does my hon. Friend accept that the AWAC, the Boeing E-3A, costs £26 million across the exchanges?
Mr. John: Without going into the figures, because I do not think that we have got to that precision in official discussions yet, whenever one buys foreign there are penalties across the exchanges. This matter will have to be considered in weighing up the suitability of whichever aircraft we choose.
Mr. Kenneth Warren: Will the hon. Gentleman give way?
Mr. John: I have just given way. I must be allowed to develop my points. I will give way at a later stage if the hon. Gentleman feels that he must intervene.
We have now redeployed the Vulcans and Lightnings from Cyprus. Although they have maintained their rôle to reinforce the base there, in the meantime, they are available to give direct support to NATO. That is another qualitative improvement in our contribution to NATO.
Mr. Julian Amery: Will the hon. Gentleman give way?
Mr. John: No. The right hon. Gentleman must be patient. He can make his own speech, and I will respond to it later.
The appointment of Commander-in-Chief Strike Command as a major subordinate commander under SACEUR will not only improve the lines of communication greatly but will enable us to allocate to SACEUR in an emergency significant additional aircraft, including an additional squadron of Harriers from the Operational Conversion Unit and, it is hoped, more Jaguars from their OCU in due course. Therefore, the picture being painted, contrary to what is being said, is one not of doom but of a strengthened capacity to help in defence where our help will be most effective in the Central Region of Europe and elsewhere in NATO.
I turn to our maritime rôle, which is another subject to which the hon. Gentleman the Member for Woking referred.

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Here it is true that there is a planned front-line reduction of strength of some 25 per cent., but that stems—I ask him again to cast his mind back—from the crucial decision we have made concerning the area in which we shall place our defence effort in the future. There are no surplus Nimrods at the moment, and there will be no Nimrods surplus until the agreement with Malta expires in 1979. It is only then—if and when no other role exists for those Nimrods—that there will be any surplus to RAF requirements and any possible sales considered. We already have 24 Nimrods based in the United Kingdom and will retain these numbers. Four more of the employment addition aircraft will be introduced into service and fitted for the maritime rôle.
I can see that the hon. Gentleman is puzzled, but we know that he has a low rate of puzzlement, and if he raises the question of the maritime rôle he must expect it to be dealt with fully and not in the rather grasshopper-like manner in which he flits from point to point.
Mr. Onslow: I thought it was said in the Defence White Paper—and I think the Minister has just repeated it—that there was to be a 25 per cent. cut in the maritime rôle, but, if I understand him, he has just said that there is not to be any cut in the Nimrods. Can he reconcile these two decisions?
Mr. John: If the hon. Gentleman had allowed me to continue—he is rather quick on the trigger—I should have made it clearer that the surplus to maritime requirements is dictated by the expiry of our agreement with Malta. But I am not saying that those aircraft in another rôle would not have a use in the Royal Air Force. That is what I am trying to point out. As I have said, four employment addition aircraft will be fitted for the maritime rôle and four will be delivered without modifications for that rôle. But there are other possible uses for them, such as oil rig surveillance, where we are studying what is the most appropriate aircraft for the task, and possibly—and here I come back to my hon. Friend's point—airborne early warning.
We are proud of the position of Nimrod as a long-range maritime patrol aircraft, and to keep it in the forefront it will shortly undergo extensive modernisation.
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Improvements to its communications equipment have already begun, and for the purposes of cost effectiveness this work will be combined with major routine servicing. As the modernisation programme builds up, spare aircraft will therefore be needed to support the front line, and here, too, the Malta and employment addition Nimrods may have a use. Once again, as I have said, in this rôle there is a picture of planned improvements being maintained.
Mr. Neville Trotter: Is it not a fact that a very substantial proportion of the Russian submarine contacts in the Mediterranean are made by the Nimrod squadron based at Malta—largely because this is a very effective aircraft, as the hon. Gentleman says—and have we not gravely weakened the NATO Alliance by withdrawing them from Malta at a time of ever-increasing Russian naval activity in the Mediterranean?
Mr. John: The agreement ends in 1979 and not today. Secondly, there must also have been a feeling that Malta was dispensable when the noble Lord. Lord Carrington, in the previous Conservative administration, prepared to, and did, pull out all military troops from Malta. As I have said, the area in which we believe we can play the most effective part in the future is the Central Region and the Eastern Atlantic, together with our own air space. In those areas the Nimrod will be as effective as ever, and enhanced by the improvements being made to it.
Dr. Glyn: The hon. Gentleman based his whole thesis earlier on the point that the nation's defence also depends on the quality of life in this country. I think he was trying to justify the reduction in expenditure on this force. Will he agree that it is not so much the quality of life in this country that matters as the force against which we are likely to be deployed? It is that which determines the size and efficiency of the force which we are required to produce to back up NATO.
Mr. John: This is a point which the hon. Gentleman constantly makes in defence debates, which is perhaps my reason for not giving way to him earlier. As the right hon. Member for Down, South (Mr. Powell) said in the last defence debate, no Government in this

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country builds up a defence programme by totting up the possible threats to security and meeting the bill on such threats. A compromise is always reached, as the noble Lord, Lord Carrington, said, between the needs of defence and the proper needs of other spending Departments. In fact and in practice all Governments carry out this sort of compromise, and if the hon. Gentleman disagrees with me on that he disagrees no less with his own party when they are in office.
The MRCA is to continue at the planning requirement of 385, and although its delivery is to be re-phased, it still occupies a central position in our plan. I will turn my attention in more detail to some of the points made by the hon. Member for Woking when I wind up the debate, but let me tell him that the air defence variant is still completing its project definition stage. We hope to be able to have an assessment of that by about the end of the year. Certainly that is proceeding.
As I tried to tell the hon. Member for Chingford (Mr. Tebbit) at Question Time today, there are always snags with a new project, and it is perhaps unfortunate that all this is taking place in the bright glare of publicity surrounding this aeroplane. We hope that the difficulties encountered are in no way inordinate in relation to other comparable projects.
Another major plane project which will go ahead is our purchase of the Hawk, so that fast jet training in the Royal Air Force will now be planned around two aircraft, the Jet Provost and the Hawk. This debate is about the capability of the Royal Air Force, and the gravamen of the Opposition charge will be seen to have disappeared when the facts are studied—if they are to be studied—by Opposition Members. If they want to divide the House—thereby taking what is not only a very unusual step in a single Service Estimate debate but a unique step for the official Opposition—they will have to put up a very much more convincing case than they have advanced so far to justify them in their fit of spleen later in the evening.
Far from saying that the Defence Review has had no effect, I should like to single out two questions as being worthy of mention in this connection—
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first, the question of stations, and, secondly, that of personnel.
The closure of the 12 stations will concentrate more of the RAF activity on the larger stations, in which there has already been extensive capital investment, in order to maximise the use of those facilities. Although such measures can be overdone, it is part of a process which has been going on for many years. Looking back 20 years, hon. Members will see that the number of airfields then open was many more than it is now. It is a continuing process, and it has been accepted—albeit with some reluctance—by the localities concerned.
But again I make the point which has been made in previous debates that the closure of an RAF station does not necessarily mean the end of its Service use. The Army, in particular, needs to replace some of its hutted camps by modern facilities. The Services are examining their needs urgently, but even with the utmost good will, it will not always he possible to dovetail the requirements, and the RAF redeployment cannot be deferred if we are to achieve the Defence Review savings. However, I can promise that all three Services will do what they can to minimise the disruption and the interruption of civilian employment.
The most significant effect to the RAF, however, is the effect of the Defence Review on Service personnel. The Review led us to the conclusion that, with its new tasks, the RAF needed to reduce its manpower by 18,000. We were determined that redundancies should be kept to an absolute minimum, and therefore we started immediately to adjust our recruiting intakes in anticipation of the outcome of the Defence Review decisions. This has already reduced the strength from about 100,000 to 95,000, and we hope, by wastage and by restrictions on intake, to effect 14,000 of the total 18,000 reduction in personnel. But some redundancy, totalling about 4,000, was necessary because wastage and recruiting restrictions could not succeed by themselves within the time-scale and within the categories needed.
Our big surplus in aircrew came in the main from the reduction of the transport force. There, some 600 to 700 officers in the General Duties Branch and 100 airmen aircrew will be made redundant, in addition to some 200 other

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officers in ground branches and about 3,000 ground tradesmen.
For most categories, the scheme is based on an initial call for volunteers, with powers of compulsion should the numbers and types of volunteers prove to be inadequate. Most of the officers, all the airmen aircrew and about one-third of the airmen redundancies were included in the categories announced in March. For the most senior officers in the General Duties branch, redundancy was wholly compulsory. For the remaining categories—that is to say, officer aircrew of the rank of squadron leader and below, all ground branch officers and all airmen aircrew—I am pleased to say that the number of volunteers covered the redundancies required. There will therefore be no need to resort to compulsion in these categories.
The number of volunteers was by no means excessive, and this suggests to me that the redundancy terms offered were judged to be just about right. Moreover, the officers and men who will be leaving the Service represent a fair cross-section in terms of quality. There is no mass exodus of our most able officers and men from the Service. I will not disguise the fact that people who have been made compulsorily redundant will feel pain and will be going out into civilian life at a bad time, but I can assure hon. Members that in general a special effort is being made to resetttle aircrew and to prepare them for other careers.
As the hon. Member for Woking said, civil aviation is itself suffering from a surplus and it is not likely that many of the aircrew being made redundant or who have volunteered for redundancy will be absorbed in that way. Nevertheless, we are making special efforts to fit them for other careers. This is a continuing process upon which I hope to keep the hon. Gentleman informed as it goes along.
For the other Service men involved, we tried to remove uncertainty as quickly as possible by saying that no one below the rank of sergeant or who had served for less than 16 years would be affected, nor would any of the WRAF. So, although some uncertainty must persist, especially amongst chief technicians and to a limited extent in three officer branches, that is now at a minimum.
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I must say frankly that some of the chief technician redundancies might have happened without a Defence Review. Over the years, and even during the period in office of the last Conservative Government, it was apparent that we were overborne in these ranks in the technical trades, which meant that they had to do jobs below their level of skill and that younger men were being denied proper career prospects because of the clogging at that level. I hope that these measures which the Government have taken will rectify the situation, which was probably as productive of premature release for younger men in the past as it is for chief technicians now. We have to bear in mind the number who were not allowed to extend their engagements beyond the 12-year category simply because there was no promotion ladder up which they could go as a result of the blockage in the chief technician rank.
I have spoken often on the subject of low flying, and I know that hon. Members, to judge from my correspondence, take a particularly keen interest in it. The fact is that, in order to perform the tasks which the RAF has to perform, to evade radar and to have a chance of completing missions successfully, pilots not only have to learn the skill when they are training but have constantly to exercise the skill so that they maintain a high level of proficiency. I believe, therefore, that the arrangements that we have made, which mean that low flying is carried out over half the surface area of the country but where only 5 per cent. of the population live, are necessary to take account first of our defence needs and secondly of the fact that people must not in peace time have their lives unduly disrupted. Additionally, minimum heights and maximum speeds reduce the nuisance that it causes.
These arrangements are kept under continuing review. Last year, a fatal accident occurred between an RAF Phantom engaged in low-level training and a civil crop-spraying aircraft. The accident has been investigated by the Chief Inspector of Accidents. But, none the less, I felt that the occurrence of this accident, although it was the first to happen within the low-flying system, called for a special review of procedures and regulations to see whether any changes could be made in the interests of flight safety.

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I announced the result of my preliminary review on 13th June, and, as I said then, we have introduced certain new measures which I believe could be of real and immediate value in terms of flight safety. First we are inviting all civil pilots who are planning to fly at 500 ft. or below to give us advance warning of their intentions. All they will need to do is to telephone the Military Air Traffic Control Centre or one of a number of RAF stations specially nominated for this purpose. This information will in turn be passed to the military aircrew who will maintain a special watch for civil aircraft in the area concerned.
The new scheme will become operative on 17th July and will run initially for a trial period of 12 months, after which it will be reviewed in the light of experience. This will involve consultation with the civil flying organisations who will also be able to comment, should they wish, during the course of the trial period. As this will be a voluntary system, I should like to take this opportunity to express the hope that the civil pilots will cooperate fully with us in order to ensure its success. For its part, the RAF will be taking active steps to promote closer liaison. Major flying stations will contact civil operators and flying clubs in the general neighbourhood both to explain the new procedures and, where possible, to give advance warning of any unusual military activity.
As a further measure, I have decided that in future no military aircraft will undertake low-level training at weekends unless there is prior notification to the contrary, although this rule will not apply to elementary flying training carried out in the immediate vicinity of training airfields. Finally, we are at present engaged in a detailed study to see what can be done to make military aircraft more conspicuous in the air, such as through the introduction of an improved lighting system.
Clearly, the need to camouflage operational aircraft limits what we can do to make aircraft more conspicuous, but it may none the less be possible to improve upon their present conspicuousness. I hope that this scheme will represent a real step forward in the concern for flight safety which we all feel. I think that it would he wrong to underestimate the dangers, because any accident is one too
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many. But this was the first accident to have occurred within the military low-flying system, and I hope that hon. Members will not be tempted to exaggerate the danger.
This is the RAF as it stands after the Defence Review, faced with the differing tasks now placed upon it. The attitude of the Opposition is unique for a single Service debate. In the major areas of European defence and United Kingdom defence, our front-line and transport forces remain quantitatively strong and qualitatively improved by the measures we have taken. It would be wholly wrong for the Opposition to divide the House on the spurious grounds that they have so far given.
There must obviously be on the part of any Opposition the need intelligently to check and question the priorities which the Government have set. But since this House has approved the Government's central strategy and since the measures announced for the RAF follow that central strategy, I see no good and sufficient reason why the RAF should be singled out for this unique occasion. I hope that the Opposition will, even now, reverse their decision and allow the Estimates to go through unchallenged.
5.12 p.m.
Miss Janet Fookes: We have been treated to what I would call a soothing speech by the Minister. I had the impression that he was acting like the wise father trying to sooth the nightmarish fantasies of an over-nervous child.
We meet against a particularly sombre background. We are aware that our main potential adversary is increasing in military strength on all sides. We are aware that in the Defence Review we have cut our capability to the extent that our NATO allies have seen fit publicly to criticise us. If they have said this publicly, I can imagine what more colourful language they may have used privately.
We had the even more sombre information this afternoon in response to a Question put by me that there can be no guarantee that there will not be further cuts if the economic situation demands it. I find this a most frightening reflection, especially as we were told that the Defence Review was so carefully planned

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to meet our requirements and to match our financial responsibilities. If we do have further cuts, it will make mincemeat of that assertion. I greatly fear that we shall place ourselves in an unenviable position.
I simply cannot understand the position of the Government who maintain that we should always bear in mind expenditure in other areas. It seems that defence expenditure falls into a category of its own. Unless we are able to defend ourselves and deter would-be aggressors, it matters little how elaborate the spending may be in other spheres. It goes for nought if we find ourselves being invaded or threatened. I do not understand why the Government do not learn the lessons of history. We have had only too many examples.
Mr. John: Did the hon. Lady take the same view in December 1973 when Lord Barber, the then Chancellor, made a wholly arbitrary cut in the defence budget? Did she vote for that?
Miss Fookes: We were starting from a higher level. The lower we go, the less room there is for manoeuvre because we are cutting nearer the bone and into the bone. I do not think that is a particularly valid point. I do not accept it at all.
Mr. Tebbit: Will my hon. Friend inquire of the Minister whether he thinks that the level of defence spending in those days was one upon which an arbitrary cut should not have been made? That is the point.
Miss Fookes: I turn now to two points I wish to make in connection with the RAF. The first concerns the Transport Fleet. We have received a number of assurances from the Minister that all is well and that we have no need to concern ourselves because our commitments have been cut down in the far-flung parts of the world and we are therefore able to meet present requirements. I emphasise the point made by my hon. Friend the Member for Bexleyheath (Mr. Townsend) in his intervention. There is considerable concern in Germany. I was one of those who made the visit to which he alluded, when we dealt with the cuts in transport and the effect that they might have.
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I do not pretend to any expertise in these matters. Therefore, the questions I put to the Minister may be considered somewhat simple and naïve. Let us suppose that there is an emergency in the central area and it becomes necessary rapidly to fly out X number of troops to reinforce our position. Is the Minister quite satisfied that this can be done without calling upon civilian aircraft? What length of time does he suppose this might take? As I understand it, the essence of modern warfare is the speed at which it moves.
I would like to know how many hours the Minister envisages it would take to move a given number of troops. Perhaps we can have an answer to that in the ministerial reply. The question of civilian aircraft was specifically mentioned since it was suggested that we could not take over civilian aircraft without some kind of order or permission. I would like to know how long that might take in an emergency.
I come now to the cuts in personnel. Looking at the figure of 18,000 in the Service, which represents an 18 per cent. cut, it can be seen to be a savage reduction in comparison with those being borne by the other two Services. For example, in the Navy and Royal Marines there is to be a 6 per cent. cut while the Army is to have an 8 per cent. cut. I do not imagine for a moment that the RAF was particularly over-staffed before. It has, therefore, taken a particularly severe blow. I suspect that it is suffering from its own earlier attempts to streamline. It is now being asked to make further cuts.
I am not very happy about the manner in which redundancy arrangements are being carried out. The Minister seems to suggest that there is a large voluntary element here. That is not what the White Paper said. The White Paper said that it was largely compulsory. I fail to understand why it should not be possible for the scheme to be made wholly voluntary, at any rate in the first stages, with the Government holding the trump card of making the final decision about who should go and who should stay. As it is, I suspect that we shall end with the extraordinary position of those who would not mind being made redundant staying put and those who desperately want to remain in the Force being made redundant. I

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hope that we can have some information about this later.
I would also like to know about what I describe as the hidden costs. As I understand it, training of RAF personnel is an extremely expensive business. I would be interested to know what it represents in training costs to make redundant the 4,000 men and 800 officers who are to go within the next 18 months. I would like to know what would be the additional cost of offering them redundancy payments.
I am not very happy about this question of recruitment. The White Paper says:
"We shall not therefore relax our recruiting effort and will continue to provide full and worthwhile careers for all those who enter."
I would suggest that any young man or woman thinking of entering the Service might well think twice in the light of the current redundancies.
I was not best pleased to receive an extremely glossy magazine sent out by the Secretary of State dealing with British policy and the rôle of the Services. It was apparently intended as an inducement to recruitment. I suggest that those made redundant would look askance at the point about offering a worthwhile and full career when they see their own careers cut off in full flight.
I am disturbed about the line we are taking with regard to the RAF. We are in danger of cutting not simply near the bone but right into the bone. If, as I hope, we decide to divide the House tonight, that will be an indication of the Opposition's deep concern about the effect of Government policy.
5.11 p.m.
Mr. Tam Dalyell: At Question Time we heard the Secretary of State rebuke my hon. Friend the Member for Bolsover (Mr. Skinner), saying that he should know that the Treaty of Rome had nothing to do with defence. At one level, that is true. I suppose that it is fair to score such points. At another level, we know that there are momentous arguments with which we should be dealing. This debate should be partly about the future of the European aircraft industry—whether, indeed, Europe will have an industry to talk about at all. Any military commitment and military expenditure is inextricably bound up with that
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crucial question, of industry and employment.
I should have liked to hear the Under-Secretary say a good deal more about the F16 episode and why there is to be a major European purchase of American aircraft. I hope that the Minister will deal with that subject when he winds up the debate.
Like others, I am increasingly fascinated by this episode of the late General Stehlin, at least as I read it in the European Press. This is an incredible story for those who started out of curiosity and who have become intrigued with it. Critical defence issues arise out of it, not least for us British.
I first ask why the Belgians have opted for an American aircraft rather than the MRCA. Did they do so because they supposed that the MRCA was deficient for its rôle? If not, why was MRCA not preferred?
I should like to know what is to be our future relationship with France. It is clear that the French, having received this rebuff, will try to sell the F1E in overseas markets. It would be uncharacteristic of the Dassault firm if it did not at least make the attempt. But the French will be faced with a very different issue if they go ahead with the ACF, the advanced combat aircraft, as a rival to the MRCA. I should think that it would be absurdly costly for the French to do that.
Granted the MRCA rôle is central to the RAF, what efforts are the Government making, in the light of the Belgian rejection, to bring France into the MRCA project? Of course, French industry would have to be involved with current and future development. Yet any rivalry between the ACF and the MRCA would seem ludicrous from the European point of view. Can we be told what has been said on these matters in the Eurogroup, of which my right hon. Friend is currently chairman?
My hon. Friend has boasted, probably rightly, about the technical success of the Jaguar project. In that case, in the light of that experience, why do we not cooperate with the French, on the basis of the Jaguar experience, over MRCA? Whether it was right to go ahead with the MRCA in the first place is a different question. However, we are now so far advanced that it is difficult to put the

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clock back, even if that were desirable which I personally doubt.
I relate my remarks to what the Secretary of State said at Question Time about the two-way stream between America and Europe. The existence of a two-way stream presupposes the existence of a thriving European aircraft industry, whose future must be in some question, in the light of the acceptance of the F16 by some of our partners.
My second issue is of a technical nature. It concerns the airborne early warning system. There exists a new generation of long-range Soviet aircraft. That is an uncomfortable fact. Some of my Friends and I find it distasteful to face the fact that there is an increased requirement for an airborne early-warning system. If that is not the case, we must ask the Russians why they are going to the expense of making a new generation of long-range aircraft. We must put this matter to our Russian contacts, who, while they are candid on many issues, are less than candid on this than on others.
The 12 Shackleton aircraft, which are old and vulnerable to electronic countermeasures, must be replaced. A question on that matter was asked by the hon. Member for Woking (Mr. Onslow). I ask it again. Is there to be a replacement for the Shackleton? I know that Nimrod is being considered. Should we take the American option, AWACs, we would need between 30 and 36 Boeing 3A aircraft, which cost at least £26 million each. We can work out that figure in terms of foreign exchange and what such a purchase would mean to the European aircraft industry. Therefore I hope there is no question of going ahead with the purchase of American AWACS.
On a related Nimrod issue, the hon. Member for Woking said that the decision to withdraw Nimrod from the Mediterranean was inexcusable. Strong language! Was there any pressure from our NATO allies or from any European country against the withdrawal of Nimrod from the Mediterranean capability? If so, on what grounds was that objection lodged? I am sceptical whether our NATO partners even privately are as angry as the Opposition seek to make out. I do not regard this as a yaboo debate, and I cannot imagine why they are dividing the House.
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Thirdly, we must take on board the point about the fuel costs of an aircraft with a convincing capability. Those costs are enormous. That is why I interrupted earlier when training was being discussed. Reserves must be trained and kept up to date. That is costly in terms of fuel alone.
I take the point made by the hon. Member for Woking about the availability of aircraft. But my point is that fuel costs are rising in terms of volume and price. This is the most important consideration.
What research is being done on aircraft fuel for the machines of the late 1980s and 1990s? What research is being carried out into liquid hydrocarbon fuel? Liquid hydrogen has been manufactured, handled and used safety in large quantities on manned space programmes. I understand that there are great difficulties in incorporating liquid hydrogen into existing small combat aircraft. On the other hand, I am told that it is within the range of possibility for bigger aircraft.
What attention are project design teams giving to this matter, especially in relation to wind tunnels, one of which McDonnell Douglas has already started. Liquid hydrogen is the cleanest burning of all fuels, and at any rate for larger aircraft should not be laughed out of court. But it has to be faced that the air forces of the world by the late 1980s or the 1990s will be in great trouble because of oil consumption. Not all of us have the geographical good fortune to be living over oil wells in the North Sea or anywhere else. I couple this with the hope that we shall hear in the winding-up speech something about the Government's philosophy on the training of reserves.
On North Sea protection, I realise that my hon. Friend the Minister did not have time to go into detail about the surveillance rôle of Nimrod. Those of us who have had the good fortune to fly in a Nimrod from either Kinross or St. Mawgan know the plane's capabilities. It is a major anti-sabotage aircraft which can be used to solve some of our worries about North Sea defence.
On VSTOL, I welcome the decision to go ahead with the maritime Harrier, but are we not on a technological plateau? What is being done to develop VSTOL techniques for civil purposes? Only five years ago many of us thought the VSTOL

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was a major project. Perhaps I might have my hon. Friend's attention. I take the view in these debates when comparatively few hon. Members wish to speak and the speeches are fairly short that we are entitled to put serious questions to the Minister. Given that there is a substantial potential for civil VSTOL, which was the darling proposition of the mid-1960s, what is being done to develop VSTOL techniques in a civil capacity?
I have two questions to ask on sales. Is there any proposal for the maritime Harrier to be sold to Iran? Would that he a package deal on the basis of the availability of a ship, for the Shah, such as HMS "Invincible". If so, will the Government tell us what they intend to do about it? It seems to some of us to be an exceedingly expensive operation for us to have a one-off through-deck cruiser, and that we might cover design and overheads by sales.
My second question is on the Diego Garcia base. Until recently we thought that this was simply a matter of allowing the Americans to use the mid-Indian Ocean atoll for their own purposes. Like many of my hon. Friends, I am strongly against the militarisation of the Indian Ocean against the will of the littoral States, particularly Sri Lanka and India. On the other hand, that is a message which might also be conveyed to the Russians. I hope that this matter will be put strongly to the Russians in our talks with them and that it is made plain that their policy as well as ours and that of the United States is against the wishes of the littoral States.
Finally, I ask a question of philosophy. These days we have unending competition to build on the latest scientific and technological knowledge in the effort to have weapons systems which will not be outmatched by those of a potential enemy. Every step that is taken becomes more demanding technologically than the one that has gone before. For a country such as ours, the line surely has to be drawn somewhere. We cannot go on to ever more sophisticated and more expensive techniques. So I ask my hon. Friend where he thinks the line should be drawn in relation to discussions with any potential adversary, and what the Eurogroup or the combinations we now have with our European partners will
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do about this central question. It makes multilateral arms agreements all the more urgent.
5.35 p.m.
Mr. Julian Amery: The Minister referred to the withdrawal of the Vulcan and Victor squadrons from Cyprus. I sought to intervene at that point to ask him a question, but he brushed me aside and said that if I were lucky enough to catch Mr. Speaker's eye I could make my point known. As I have been lucky enough to do so, I shall now refer to this matter.
The V bomber squadrons in Cyprus provided the only tactical nuclear backing to the CENTO Treaty. I am not clear how far this has been replaced, or in what way. I do not wish to ask for a public explanation of the details, but I should like to know whether any provision has been made for an adequate substitute for the forces that were there.
My main reason for intervening in the debate is to mention a matter on which the hon. Member for West Lothian (Mr. Dalyell touched in his opening remarks, that is, the recent Belgian decision about the re-equipment of the fighter side of their air force. This highlights the central problem of procurement in the NATO alliance. Perhaps the Minister will enlighten us on this when he winds up the debate.
I understand that there was no clear operational requirement laid down by NATO as to what the Belgian Air Force should seek to buy. Is this so? The two aircraft which were competing—the French aircraft and the American aircraft—were of quite different performance types. The Dassau French aircraft was an interceptor with a high interception capability and a very limited ground attack capability. The American aircraft had virtually no interception capability and a rather limited ground attack capability.
A strong case could have been made for the Jaguar as having a very powerful ground attack capability. A case was put forward—and I dare say it was put forward by the Secretary of State for Defence—for a two-aircraft solution, the Jaguar for ground attack and the French aircraft for interception, if interception were

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needed. A strong case could also have been made for the MRCA which, although primarily expensive, would have been available in about the same time scale as the American aircraft. As I say, the MRCA is expensive to buy. But we know something about the costs of American aircraft, which include not only the more dubious salesmanship practices to which the American aircraft industry is accustomed and which have been referred to in recent Congressional hearings, but also the high cost of spare parts which is charged to customers.
Did our industry press hard enough for a Jaguar solution, or a Jaguar cum F1 Dassau solution or for the adoption of the MRCA? Did the Government press hard enough? There is an impression in aircraft industry circles, and indeed in Europe, that because we were hesitating about the referendum and our general attitude towards Europe, we did not press as hard as we might have done for the sale of these aircraft.
A special responsibility here rests upon the Ministry of Defence, and not just on the procurement branch of the Ministry. The Air Staff of the Royal Air Force, along with the American Air Staff, remain by far the most experienced in the Western Alliance. They alone have a continuity of experience stretching right back before the war, through the war and into the post-war perid. Were they enabled to bring their influence to bear on Belgium and similar European countries in determining the right operational requirements? Was their voice properly heard in NATO, and was any attempt made by us in the Eurogroup or elsewhere to determine the operational requirements? The problem is one of some urgency.
Although we have confidence in our American allies, we must realise that we are looking a long time ahead. Defence problems take the best part of a decade to mature. I think we all feel that we cannot rely indefinitely on American supply or on American presence. There should be a European procurement programme for the European branch of NATO. Of course, it would be ideal to have a reciprocity arrangement with the Americans whereby they bought things that we made and we bought things that they made. But in four years as Sec-
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retary of State for Air and Minister of Aviation I never succeeded in getting anywhere along those lines. I do not know that anyone else has done much better since in getting any real reciprocity with the Americans as regards procurement.
Mr. Michael McNair-Wilson: Does my right hon. Friend think it unreasonable for NATO to buy aircraft that are made by a NATO country when the argument that he is putting forward presupposes that NATO should buy aircraft from a country that has decided unilaterally to stay outside that grouping in defence terms?
Mr. Amery: Perhaps I have not made myself clear. I was not advocating that the Belgians should have bought the French aircraft. On the contrary, I was saying that as far as I can see the French aircraft is an interceptor and does not conform to the admittedly very sketchy operational requirement for a ground attack aircraft. I am not in the least advocating that the Belgians should have bought the French aircraft. I am trying to advocate that there was a strong case for buying Jaguar, which is a better ground attack aircraft than the American design which is still on the drawing board, or better still the MRCA, which although more expensive would have been far superior to the American aircraft to which the Belgians are now apparently committed.
We must have a certain caution in all these matters. But I believe that we must create a European defence industry based primarily on the technology of this country and that of France. Of course, there are big political difficulties in regard to France to which my hon. Friend the Member for Newbury (Mr. McNair-Wilson) has adverted, but I am sure that with good will they can be overcome. What is tremendously important is that there should be a clear definition of the operational requirements of all the NATO countries that are buying aircraft. That was the main point of my intervention.
The Minister has criticised my right hon. Friend and hon. Friends for proposing to divide the House. I think that his own speech provided the best justification for doing so. The Minister made it clear that there is an essential difference

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on strategy between Government and Opposition as regards the Indian Ocean and the Mediterranean. This is expressed primarily in the cuts which are being applied to the Royal Air Force. I do not think the Minister can be surprised if we find ourselves in opposition to those cuts, which strike fundamentally at the root of what we believe should be Britain's world strategy.
5.43 p.m.
Mr. Emlyn Hooson: I agree with the right hon. Member for Brighton, Pavilion (Mr. Amery) in his belief that at some stage there should be, and the sooner the better, a European procurement agency. I developed that point in the debate that took place last week on the Army. It is very important that France should agree to such a proposal. I would have thought that some initiative from France is required before we can achieve such an agency.
I respond in the very short contribution that I wish to make to the Minister's appeal that we do not deal with general strategy but concentrate on the rôle of the Royal Air Force. I thought that what was missing in the Minister's speech was an attempt to deal with that very question—namely, the role of the Royal Air Force in this country's present defence effort.
It is my impression that the Royal Air Force is almost a force in search of a rôle. It seems that in the reassessment of its position it is virtually ancillary to the other Services. For the sake of morale in the Royal Air Force I would have thought it necessary in the long term for the Ministry of Defence to spell out much more clearly the RAF's rôle.
That brings me to the matter that has been referred to already—namely, the North Sea and its general surveillance. That matter has never been dealt with in any detail by any Minister from the Dispatch Box, yet it is of vital importance. Clearly our oil interests in the North Sea have added to the importance of the North Sea, but it is also the direct route from the Soviet Union. By now we should have had set out in much greater detail the steps that are being taken by Great Britain, and particularly the rôle of the RAF, in the surveillance of the North Sea.
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For example, how many patrols take place? We know that there is a helicopter stationed at Prestwick and that one or two other aircraft carry out general patrols in the North Sea, but there have been many incidents, and one or two specific incidents in the past couple of years lead us to suppose that the surveillance is very much short of what it should be.
Clearly there is an important rôle not only for Nimrod but for vertical take-off aircraft. Surely the vertical take-off aircraft will be able to alight on and take off from some of the platforms in the North Sea as well as helping with an early warning system. I should like to hear the Government spell out how they envisage a developing rôle for the RAF and the integrated services of the other forces as regards the North Sea.
I understand that the Andover aircraft is being phased out of the RAF transport section. It seems that a minor but important rôle that the RAF has played very successfully has been the carrying out of relief operations in various parts of the world. I always understood that the Andovers had been particularly useful in that respect. Is it sensible for the Government to do away with all these aircraft? Obviously they carried out many other functions, but disaster relief in different parts of the world has provided valuable experience quite apart from anything else. I should like the Minister to deal with that matter in greater length.
I have only one other point to make although in general I agree with the Government. If there is a vote this evening I shall be voting with the Government.
Mr. Tebbit: The hon. and learned Gentleman has not heard their speeches.
Mr. Hooson: In fact, I have heard every one of the Government's recent defence speeches. The hon. Gentleman should take care what he says from a sedentary position.
I deal with a totally different matter, on which I have been in communication with the Minister—namely, the low-flying aircraft to which my part of the world is subjected. I and my constituents appreciate the need for air crew to be trained in that way, but it is a matter of relief

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to know, as far as I understand it, that there will be no weekend flying. But what is "weekend" in this parlance? Perhaps the Minister will tell us about that.
I have had a case in my constituency where two animals died as a result, without any doubt, of low-flying aircraft. A pony was found embedded in a fence of barbed wire following the passage of a low-flying aircraft and a bull calf was found dead 40 or 50 yards away on the very same day. The farmer was unaware of the procedure which had been agreed between the National Farmers' Union and the Ministry and as a result has received no compensation, although he has lost a valuable pony and certainly a commercially valuable bull calf several months old. I have been unable to get any satisfaction from the Ministry of Defence on this matter and I have handed over the file to the NFU Parliamentry Committee which met the commission yesterday on the subject.
Unfortunately, the farmer and his wife did not know the procedure and were too late in calling on the services of a veterinary surgeon. They thought it obvious that both animals had died following flights by low-flying aircraft. They did not know that a procedure had been agreed with the NFU. By the time they were told about it a couple of weeks had elapsed, and therefore the Claims Commission was unwilling to entertain the claim. If such a case had come before a civil court on a balance of probabilities, without any doubt the farmer would have been able to establish his claim.
It is bad enough to live in an area where one is constantly subjected to the disturbance of low-flying aircraft, even if such flights are necessary for the defence effort of the country, but it is very much worse when it gets round in a farming community that a farmer who has lost two valuable animals has been awarded no compensation at all. It is a matter of red tape. In the end it boils down to the question: how can anybody judge such a claim unless he sees the farmer and knows what kind of man he is, or speaks to people who know him and is thereby able to judge for himself whether it is a proper and valid claim.
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I hope that the Minister will deal with this matter since it is a matter of importance in an area such as ours—namely, a hill area where many farmers bitterly complain about low-flying aircraft but learn to live with the situation and to tolerate it. It undermines their morale considerably when they hear of such a case. The Ministry has made a great mistake in not dealing far more sympathetically with that claim.
5.54 p.m.
Mr. Frank Allaun: I wish to deal briefly with four points. First, I wish to draw attention to the fact that we have had no statement in Parliament so far on the U2 aircraft at Wethersfield. The House has had no opportunity to discuss this important matter. The arrival and use of five aircraft at Wethersfield was concealed. Extra security was applied at the air base and the matter came to light only because it was disclosed by an alert local reporter. It has subsequently emerged that one aircraft during one part of its flight was only six seconds' flying time from the East German frontier. Does the Minister regard such a flight as wise at a time when we have hopes of a relaxation of tension—indeed, on the eve of three international peace conferences?
These aircraft have the whole of the United States in which to practise. Why pick such a sensitive area for their operation?
I maintain that the flight was provocative and that some military gentleman—I know not who—deliberately wanted to sabotage the peace talks this summer. That may be a strong charge to make, but we all remember the Gary Powers flight in 1963, when his U2 aircraft was shot down over Russia. That incident wrecked the 1963 summit conference. I hope to goodness that the flight to which I have referred will not wreck this year's peace conferences.
Mr. Tebbit: Does the hon. Gentleman take the same view about the dangers to world peace which arise when Russian so-called trawlers come within the prohibited safety zone near oil rigs in the North Sea?
Mr. Allaun: Certainly. The hon. Gentleman should know me well enough

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to realise that I do not oppose military moves by NATO without equally opposing military moves by Warsaw Pact countries. A few more seconds and that aircraft could have been shot down over East Germany and we could have had a repetition of the 1963 fiasco.
There are one or two questions which I should like the Minister to answer. Was permission given to the United States Government by the United Kingdom Government before the U2 aircraft arrived in our country? Was it discussed with the United States Government? Was advance permission given to the United States Government to use those aircraft—based in Britain—so near to the frontier in the heart of Europe? Will the Minister ask the United States Government to remove those aircraft before any more damage is done?
Next, I wish to refer to the reply given by my right hon. Friend the Secretary of State for Defence this afternoon at Question Time, on the subject of arms cuts. There are no cuts in arms spending. The Minister has admitted that our arms spending, in real terms, will increase by £200 million a year within the next two years and will stay at that plateau, in real terms, over the next seven years. God knows what that means in terms or inflation. We know that there will be a cash increase of £900 million this year.
I was sorry to hear the Secretary of State merely repeat a spurious argument which has already been disposed of. He talked about vast savings of hundreds and even thousands of millions of pounds. He well knows that such a saving is in relation not to current spending but to what might have been spent by a Conservative Government—although I doubt whether that Government would have been able to put that plan into practice in 1973.
It is similar to a man going home to his wife and saying "I have saved you £2,000." The man's wife replies "But you have just bought a car." "Ah, yes," says the husband "but I intended to buy a Jaguar and instead have bought ony a Mini. Therefore. I have saved you £2,000." That is a completely false argument, and there is some parallel with the current situation.
Conservative Members are saying openly—indeed, the hon. Member for
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Torbay (Sir F. Bennett) said it only last week—that they would cut public spending on housing, pensions, education and health but would increase the spending on arms. I must tell my hon. Friend the Minister, and, through him, my right hon. Friends in the Government, that the Labour movement will not take that line. There are rumours that in the next few weeks there will be serious cuts in social spending. I hope that the Minister will convey to the Cabinet the view that some Labour Members will oppose social spending even by a penny—and certainly if that happens before arms are cut, as we promised as a party to cut in our election manifesto.
I turn to the subject of the sale of arms, of which there are two recent and alarming examples. I believe that arms exports in general are a dirty business. It is one export we do not want. It increases world tension, and involves a moral issue. Human life must come before profit. We should be switching military exports to civilian exports and following the example of Japan, which has captured world markets because it exports no arms at all.
Consider the two recent cases. The first is the proposal now under discussion—I was told by a Minister yesterday that no decision has yet been taken on it—that we should sell £450 million-worth of arms to Egypt. At the same time, we have been selling hundreds of millions of pounds-worth of arms to Israel, including Chieftain tanks.
What is happening? America is selling arms to Israel. Russia is supplying arms to the Arabs. And we are busy flogging them to both sides. There is something disgusting about profits being made out of men slaughtering one another with arms sold them by firms in other countries.
A serious contribution towards ending the war in the Middle East could be made if the Big Four—Britain, France, America and Russia—said "We will impose an embargo on all arms supplied to the Middle East". In the meantime, Britain should give a lead by contracting out. It will be argued that this would be costly to our exports. Perhaps it would. However, if the Middle East war recommences, it could become the third world war, and that would be far

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more costly to the people of Britain and of the world than losing the revenue from exports of weapons.
The second recent example of the sale of arms concerns nuclear weapons. I believe that all hon. Members, whatever their political views, are nervous about the proliferation of nuclear weapons, which vastly increases the danger of war by accident. The more countries that have nuclear weapons, the greater the danger, one day, of such weapons falling into the hands of a fanatical dictator prepared to use them even if he knows that the other side will immediately retaliate in kind. Hitler would have been prepared to do this. If he had had the bomb he would have been prepared to use it, because he was prepared to commit suicide in the Berlin bunker. There are some fanatical dictators in today's world.
Recently there have been sales of nuclear reactors, nuclear technology and the ability to produce plutonium and enriched uranium. I have in mind two examples—first, the supply of nuclear plant by West Germany to Brazil and, secondly, the supply by Canada to India.
I very much welcome the confidential conference which took place in London last week. Perhaps my thought is an unworthy one, but I hope that America was genuine in its approach and not motivated by the fear that the West German undertaking was getting the market in Brazil. I hope that that was not the case, because much more important issues are involved than that of who gets the contract.
I should like to refer to the frenetic attitude of some gentlemen, both inside and outside this House, to Soviet Russia and its armed forces. I repeat that I have no love of armed forces. The Daily Telegraph has been running a daily series on its editorial page entitled "The Threat to the West". Some warmongering articles and letters have been published in that series. It leads me to believe that we are almost back in the age of the unlamented Senator Joe MacCarthy.
It is time that we talked of the real military situation and not in terms of the nightmares of Conservative Members and Press lords. I refer these gentlemen
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to the Pentagon Report of 1973. We have been told that we are overwhelmed 2:1 or 3:1 by Soviet forces. That is just not true. The Pentagon Report of 1973 declared that there was parity in conventional weapons on both sides in Europe. The report stated that the NATO Alliance has twice the naval resources of the Warsaw Pact. It said that there are more Soviet tanks than NATO tanks. However, there is more NATO anti-tank artillery, and the NATO forces have vast numbers of tactical nuclear missiles already targeted on Soviet cities. We must not believe that only one side is threatening the other. Both sides have huge military forces.
A mistake has been made in calculating the number of Soviet tanks. That mistake may have been accidental or deliberate. To arrive at the number of Soviet tanks the number of tank sheds has been counted. We now know that many of those tank sheds are empty and. therefore, a greatly inflated number of Soviet tanks has been estimated.
Do the war hawks really want to avoid war, or to win a war? No one will win a third world war. Our job is to avoid it. If they want to avoid war, I should point out that war is more likely to arise from an accident—such as a border incident along the vertical frontier through Europe escalating into a world war—than from planned aggression by either side.
Mr. Dalyell: The hon. Gentleman has always been critical of Russian military spending. I agree that to some of us this is disconcerting. The fact is that the Russians are building up and increasing a vast naval capability in the Indian Ocean and are also spending resources—resources which could be used elsewhere in the Soviet Union—on developing long-range aggressive aircraft. In these circumstances, should not those who have many Soviet friends indicate that we find it difficult to understand why they should be developing their forces in this way? Should the Russians not understand that some people in the West, who want to be friendly with them, are disconcerted by this?
Mr. Allaun: I agree with every word that my hon. Friend has said. Those of us who are genuine about this matter do not have double standards. Certainly,

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there are vast Soviet forces, but my hon. Friend must remember that there are equally vast American forces, and that when we ask our Government—and they are the people with whom we are most closely in contact—to cut arms spending and to devote the money to other and better things, we say precisely the same to the Soviet Government. Indeed, I have attempted to do this.
I welcome the progressive step that is being taken this summer in Europe. It appears that we are on the verge of agreement between East and West on the question of advance notice of military manoeuvres within a given distance from the East-West frontiers. It is only a small step, but someone once said that the journey of a thousand miles begins with a single step. This step will lessen the danger of war by accident, which threatens us and the whole of mankind. I hope that the Government will pursue this kind of policy rather than fall into the trap of saying that we can prevent war only by having larger and larger armed forces.
6.10 p.m.
Mr. Kenneth Warren: I must first declare an interest. I am an aeronautical engineer by profession. When I sought to try to compare the Air Estimates in the Defence White Paper with the threats which the United Kingdom and NATO face, I am afraid that I found tremendous discrepancies between the kind of statistics which Her Majesty's Government were deploying and statistics available from other unbiased sources. I do not know from where the hon. Member for Salford, East (Mr. Allaun) obtained his figures on artillery. No doubt he will take up that matter with his Ministers.
The statistics tell us that there are twice as many artillery weapons facing us from the Warsaw Pact countries as we have pointing back the other way. It is without doubt necessary for us to dive a little more deeply than the White Paper allowed us to dive if we are to arrive at any understanding whether the defence estimates for the Royal Air Force meet the threats which are facing us.
In terms of the White Paper we are told that there are 1,600 NATO aircraft facing 3,680 Warsaw Pact aircraft, but the Stockholm International Peace Re-
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search Institute whilst agreeing about the 1,600 NATO aircraft, tells us that there are 4,350 Warsaw Pact combat aircraft facing us. Therefore, 670 aircraft have gone missing in the White Paper. That is more than twice the front-line strength of the RAF today.
Indeed, the RAF itself is in a very puny state. I admire the courage and skill of its officers and men for being able to mount the kind of air defence they can offer. But they are outnumbered by more than two to one in front-line strength by the air force of East Germany alone. Therefore, we are in an extremely dangerous situation.
I hope that the Ministry of Defence will consider the need not only to reexamine its own statistics but to consider the rigidity with which the NATO forces believe a Russian attack will take place. I believe that there are far too many generals, air marshals and admirals around who have not had the up-to-date experience that is essential if we are to face the Warsaw Pact threats. None of these people appears to have gone either to the Middle East, to find out what was happening there, or to Vietnam. Much as I abhor war, the fact is that one ought to learn from what is going on where the Russians have so successfully deployed vast weights of arms.
I am concerned that the Herman Kahn escalation theory has been sitting rigidly in the Ministry of Defence and, indeed, in the headquarters of NATO when it is completely out of date. We have had demonstrated repeatedly the fact that Russian or Communist aggression appears as and when opportunities can be taken to erode the strength of the West. It is phased in intensity and in time to a level which the public in the West will accept as tolerable.
If we look in a little detail at the kind of aggressive forces being built up by the Russians—to which the hon. Member for West Lothian (Mr. Dalyell) so skilfully referred—we find a tremendous growth in the air support available to the Russian navy. It is worth detailing the numbers of aircraft they have which are actually facing us. Against our shipping lanes in the Atlantic and the Northern Approaches, their strategic striking power is, as the hon. Gentleman said, composed of a whole new generation of long-range

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Soviet aircraft. There are 280 Badger aircraft, fitted out with air-to-surface missiles. These are supported by 150 tankers of a similar type. There are 50 very-long-range Bear aircraft, and 55 Blinder supersonic bombers, plus numbers of other aircraft. Therefore, the Soviet air arm supporting their navy now numbers 715 combat aircraft. Against this our deployment is pathetic.
I welcome the purchase of the 25 Royal Navy Harriers, but it is not matching, on the scale we need to match, the threat which is coming upon us. The Russians are building three aircraft carriers. They have nine others planned. It is my fear that the Russians are developing a sea stranglehold and an air stranglehold which will close rapidly around our throat. In fact, we might not even fight a war at all before we are defeated.
Our whole strategy is based on NATO's ability to be supplied, in time of our choosing, from the United States. But NATO has been outflanked, particularly in the air. The bases at Conakry, Socotra and Somalia, built up by the Russians, are hardly likely to be considered by anyone—I hope—to be bases designed to defend either the Black Sea or the Baltic. In fact, we have seen, particularly in the Russian air force, a move from defensive systems to offensive weapons systems.
I am very concerned not to see that cheerful chap the Under-Secretary of State for Defence for the Royal Navy present at this debate, because I find him a charming man to have around—except when I read what he is reported to have said, which I should be delighted if he denied in due course. He said that he was considerably concerned because the United Kingdom presence at Simonstown was provoking the Russians to deploy vessels in the Indian Ocean.
Today the Minister, quite rightly, concentrated our attention on the need to defend central Europe. Against the array of might that we have facing us across the Iron Curtain, I think we generally accept that we are outnumbered right across the board in everything, whether it be on land, sea or air, by weapons outnumbering ours by about two to one. But I fear that the ratio is far worse
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than that. The lack of standardisation in NATO makes me believe that that outnumbering is as bad as four to one. In the Second Tactical Air Force, for instance, there are four different types of bomb, five different types of gun ammunition, six different napalm containers and 16 different types of drop tank.
People outside the House, who have the ability to watch television programmes which Members of the House do not have, saw a very worrying feature on Panorama this week showing how to supply fresh water to ships and how many couplings there are. Those are details which might worry anyone. However, when one finds Dr. Luns, Secretary General of NATO saying that there are 130 different types of aircraft in NATO, and Admiral Sir Peter Hill-Norton saying that in a recent exercise 60 NATO aircraft were shot down, metaphorically, by our own side because the systems of radio communication were different—and this number added up to half of the total forces deployed—one realises that we really have big problems and that we are wasting a lot of money by failing to standardise equipment.
It seems to me that after 25 years of NATO, we have not only still got a collection of countries separated by passports and body checks; we have a collection of national air forces built up with only one common feature—that they share a common potential enemy. Each air force in NATO has its own weapons inventory, studied, specified and selected by its own national staff officers. Collaboration exists, but let us see what kind of collaboration it is.
I often think that it is nice to ask a general question, such as "What goes on in the Ministry of Defence?", hoping that no one will answer because the answer may worry one even more in terms of the standardisation of aircraft, systems, maintenance and training. As mentioned this afternoon, we have for instance, Nimrod. It is a remarkably fine aircraft, unequalled anywhere in the world. I fully understand the reasoning and pacifism of the hon. Member for Salford, East, and I admire that, but when he says that we should contract out of arms sales I wonder whether he has suggested that to the Hawker Siddeley workers at Woodford.
Mr. Frank Allaun: Yes, I have.
Mr. Warren: That is right. They told me that the hon. Gentleman had done so. They also told me that the alternative that the hon. Gentleman had suggested was that they should make caravans instead.
Mr. Frank Allaun: I am very glad that that point has been raised. I visited the factory and met the shop stewards and workers. I put to them the point—with which they fully agreed—that it would be very much better if their firm were employed on the HS146, which had been put on ice. After all, the HS146 is a civilian aeroplane, which would bring in money and would not be helping to spread dissention in the world.
Mr. Warren: I am sorry that the hon. Member was unable to deal with the caravan story, but perhaps the shop stewards can enlighten me later on that point. The Nimrod situation is particularly worrying to me, especially in view of the saga of the F16 in North-West Europe. A study is in progress in NATO of the kind of aircraft which could meet the airborne warning and control system requirement of Europe and this country. The committee is chaired by an extremely competent Royal Air Force Officer, but I was startled to find it is studying only one aircraft—the Boeing E3A. I was told in reply to a Parliamentary Question that:
"The potentialities of a development based on the Hawker Siddeley Nimrod have been fully represented by Her Majesty's Government at all stages of the NATO discussions"—[Official Report, 20th June 1975; Vol. 893, c. 545.]
The worrying point is that NATO has taken no notice of what the British Government have said and is blindly continuing, under the chairmanship of this officer, studying only the American aircraft. The hon. Member for West Lothian (Mr. Dalyell) remarked how expensive the Boeing is, but the Americans are offering a 70 per cent. cash discount to make sure that its price is only about the same as that of the Nimrod and that is hard luck on our aircraft workers. I love the Americans, but they are extremely sharp and would be happy to see our aircraft workers put out of business.
Mr. Dalyell: is the 70 per cent. discount on the figure of £26 million, and does the cost of the Nimrod include the fitting of the radar dome which would be necessary for high flying and the AWACS rôle?
Mr. Warren: To the best of my knowledge the 70 per cent. discount is on the £26 million. The cost of an equipped Nimrod would be about £9 million or £10 million, compared with £11 million or £12 million for an E3A. I am subject to correction on the details of those figures, however. We are not dealing here with a small order. It involves 45 aeroplanes, so, whatever the total sum of money involved, the total volume of business which could come to this country is something we should be fighting extremely hard to get. I believe that we are being rushed into a timescale which suits the Americans but which does not meet our requirements.
I plead with the Government not to be forced to accept an aircraft before we need one, and to back the home product. It is important to be seen to do this because many overseas customers are drastically worried about the impact of nationalisation on the aircraft industry, and that is causing them to consider whether they should buy British at all. I was told by an Australian at the Paris Air Show that it had been decided to buy relatively antiquated American equipment rather than the Nimrod, since they were not sure that for the 10 or 15 years that they wanted to operate the Nimrod, Hawker Siddeley would be in existence. The same will apply in the case of Canada and Holland. The Germans are about to sign up for 27 anti-submarine aircraft which they are to buy from Lockheed. All around us there are lost opportunities, because we do not field our first team in trying to sell our aircraft overseas. That first team should be from the Royal Air Force and the Ministry of Defence.
I turn to the saga of the Jaguar. There has been a great deal of talk this afternoon on the question why the Jaguar was not bought by the Dutch and the Belgians, but it is difficult to persuade them to buy it when we refused to sell it to India. The potential sale of the aircraft, spread over its life, would have brought in exports to the tune of about

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£600 milion. That would have been a tremendous boost for the workers at Preston and at Rolls-Royce, but the Indians were told they were not sufficiently creditworthy to have the Jaguar. They were told they could have the money to buy frigates, but when they said they did not want frigates but wanted to use the money to buy the Jaguar, they were told that it was frigate money, not Jaguar money.
We are operating in a cloud-cuckoo situation. Britain is good at building aircraft but in deploying the forces necessary to sell them the Government lack the kind of initiative wich is essential to beat the Americans. As for the North-West Europe order, I do not believe the French ever stood a chance. France is not an active member of NATO and it failed to supply the aircraft which Israel had bought at a time when Israel desperately needed them during the Six Days' War. France was not considered to be a safe supplier. It makes half the Jaguar, but would not support its sale, and I believe that the Ministry of Defence did not put in sufficient power until it was too late. It was perfectly correct for the hon. Member to raise the Question of the capability of the General Dynamics F16. It is a remarkably fine aircraft, but it does not meet the first requirement of these two countries in their NATO rôle—to stop an incoming armoured thrust.
The Minister reported to us this afternoon, in connection with the MRCA and its definition as an air defence aircraft, that the aeroplane, which first began to get off the drawing board around 1967, has still not reached the stage at which it is possible to say what shape its inside will be when it flies as a fighter. The F16 managed to do that in three years. Why? Where is the determination in our Ministry of Defence?
I should have liked to see a solution to this problem pressed by the Ministry of Defence to split this order in terms of, say, 200 F16 aircraft and 150 Jaguars. That would have provided the kind of capability that NATO demands of Holland and Belgium. Again, when I asked the Secretary of State whether he would seek urgent discussions with his fellow NATO Defence Ministers about the effect
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of the selection of the F16 on the ability of Belgium and Holland to carry out their required defence rôles in support of other NATO nations, he simply replied "No". We cannot stand aside from these responsibilities. We should be united to face the threat which comes from across the Iron Curtain, and we cannot exempt ourselves from the responsibility of worrying about what is happening in the air forces of other nations.
There are legions of tales that could be told of friendly African states which thought they were in the final stages of negotiation for a missile but were then stopped by the Ministry of Defence. There is the tale of a BAC aircraft which was to be sold to a Middle East State, but after two years of negotiations the company was told that it could not sell it. Now there is the Madge system, on which £5 million has been spent, and now the Minister has to decide how to scrap it.
The power and strength of the Ministry's Procurement Executive, which costs £200 million a year and employs 70,000 people, should and could be deployed much more effectively. Britain is one of the prime arsenals for the defence of NATO. More than half the aerospace capability of Western Europe lies in this country, and yet that industry is not being pushed and encouraged by the Government as it should be. We have seen one trade union delegation after another coming to the Palace of Westminster in the last several months, from Rolls-Royce, Dowty, The British Aircraft Corporation and Hawker Siddeley, all demanding to know what the Government are up to and why they are neglecting to make sure that these skilled and unique people have the chance to use their expertise manufacturing and in selling around the world.
I should like to offer four recommendations to the Government. The purchasing policy of the Royal Air Force must be dramatically improved, and must be based on Western Europe's capability. The first thing we would have to do is to agree joint specifications for all military equipment and to make sure that there is interchangeability across the NATO nations. This is a political matter, and something I hope the Secretary of State, as Chairman of the Eurogroup, will pursue most

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assiduously. Secondly, I hope that the joint specification will be based on European design and production capability. With the stranglehold of the Russian navy and air force now around us, we really must shorten our supply lines rather than rely entirely on support logistics from the United States.
Thirdly, those joint specifications must be equivalent to export specifications. Fourthly, I would like to see export sales teams formed. I would not mind whether they were led by the defence sales department or by the industrial company concerned; that is up to them to decide. But I would like to see integrated teams of manufacturers of aircraft, engines and equipment. I would even like to see a few trade unionists there. They would no doubt like to help to sell British aeroplanes. I would like to see RAF aircrew and ground crew as part of the integrated team, because that is what we meet when we are trying to sell overseas. We meet serving American officers who come and go with the General Dynamics team. Why cannot we manage this? These are not unreasonable suggestions, and I hope that the Government will be prepared, if not to accept them, at least to think about them.
6.31 p.m.
Mr. Caerwyn Roderick: Many have argued more forcibly than I am able on the wider issue of defence cuts. I am not going again over that ground this evening. I am simply posing the question whether we would be adequately defended under the Opposition's proposals. They seem to have some idea that there is an absolute for expenditure, and when we have reached it everything in the garden is rosy. My right hon. Friends are producing cuts on those proposals. We must not succumb to the danger of thinking we can support systems that could cover all contingencies. We must make a choice. It is a matter of priorities.
I recognise that elements of the RAF perform useful functions in the civilian field, and I ask my hon. Friend whether it would be possible to estimate the kind of expenditure that goes on activities of this kind and to publish them separately, so that we can see the true nature of those activities. I am conscious that any cuts in expenditure almost inevitably
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involve manpower cuts, and I would no more want to create distress in the form of unemployment by compulsory mass redundancies from the RAF than I would in any civilian occupation. I am glad that my hon. Friend has this in mind.
My hon. Friend and I may not agree on the degree of reductions necessary, but we would agree that they must be phased in such a manner as to cause as little hurt as possible to individuals. I urge upon him to effect continuing economies in order to achieve a lower final target figure. Tonight we have yet a further example of the curious thinking of hon. Members opposite, who are almost totally united in parading round the country asking for cuts in public expenditure and yet, in this House, time after time, when they come to a particular item they demand a standstill on expenditure, or increased expenditure. It is this kind of dual thinking——
Mr. Anthony Nelson: Does the hon. Gentleman accept that Her Majesty's Opposition are united on cutting out extraneous expenditure on vast elements of nationalisation, on large elements of food subsidies which still exist, and on large and increasing elements of council housing deficits?
Mr. Roderick: I may be a little slow, but I do not see the relevance of that intervention to the point that I was making. My point was not so much about unity as about the fact that although the Opposition are for ever asking for cuts in public expenditure, when they become itemised they want to increase expenditure. Hon. Gentlemen opposite defend what is, in their mind, a special case, like rate relief and other matters, but it seems that everything else is a special case when we deal with it on the Floor of the House.
My hon. Friend referred to the problems associated with low-flying aircraft. He will understand that I have a special interest, because he knows that I am one of his more regular contributors on this subject. This is for the obvious reason that I represent a sparsely populated area, and the policy has been to use such areas for low flying, so as to inconvenience as few people as possible in this country. It is accepted that thereby fewer people are inconvenienced, but this is of little comfort to those who are inconvenienced.

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It is a little like unemployment. To the unemployed person the percentage of unemployment has no meaning whatsoever. In these areas low flying causes considerable friction. To those who have not experienced this phenomenon I would say that it is a totally different one from that of transport or civil aircraft taking off and landing at an airport. It is an entirely different experience, because the noise comes upon one very suddenly. There is no gradual build-up of sound as there is with other aircraft, when one can prepare one's self for the worst. It is the suddenness of the noise that frightens people, children and animals, and causes a great deal of distress. I have been in areas in my constituency and elsewhere where one suddenly finds a plane passing alongside or even below one. It one is standing on high ground, aircraft fly down the valleys. This is part of the training course. It can be frightening when the noise breaks suddenly and one looks round and finds what is happening. This afternoon I was speaking to a young girl, who told me that in her school they have witnessed planes passing alongside, perhaps not close to, but at that kind of level, because the school happens to be on a high level and the lower ground is suitable for a plane to pass over.
Mr. Paul Hawkins: Does the hon. Gentleman realise that other hon. Members also have this problem? Other hon. Members realise, however, that the RAF has to train for the most important job in low flying and that there are few areas within Britain where it can be done. Again, in Western Germany the civilian population is concerned that low flying is taking place, so the air force has immense difficulties. Hon. Members should appreciate that and should not always criticise the RAF for these low-flying exercises, which are necessary to maintain training.
Mr. Roderick: As yet I have made no criticism of the RAF. I am simply posing the problem facing people who live in these areas. I ask that the burden be fairly shared. I do not accept that these areas are necessarily the only ones in which this activity can take place. There may be more heavily populated areas which should experience this. Why not? It is a distressing experience for the indi-
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vidual. Why continually apportion it to certain areas?
Mr. Hooson: Like the hon. Gentleman, I have been complaining for a long time and asking for something to be done. There is another alternative. As half of the land area of Great Britain is subject to these low-flying aircraft, they could use part of that land for some period and then give some areas complete freedom from this phenomenon. Surely that could be done.
Mr. Roderick: I agree with the hon. and learned Gentleman. I was about to make one or two suggestions. I do not know whether they are valid but I would ask the Minister to consider them. The Minister spoke of inviting owners of civil aircraft to give notice when they are going to fly below 500 feet. They need not be invited to do so. Why not have a period when they are compelled to make such notification? There may be good reasons for inviting them, but I see no reason why they should not be compelled to give this notification.
Mr. John: Quite simply, the reason we are putting forward this voluntary scheme is that we are anxious to catch the crop-spraying season, which starts in a month, and voluntary notification is the only way in which we can possibly put these worthwhile precautions into effect in the time available.
Mr. Roderick: I thank my hon. Friend for that intervention. I hope that he will consider making the giving of such notice compulsory.
I also welcome my hon. Friend's statement that military aircraft will cease to carry out low-flying training at the weekend. That will give some relief.
As the hon. and learned Member for Montgomery (Mr. Hooson) suggested, it should be possible to concentrate these activities into a shorter period in any one area and then move to another. I should like to see that tried, with sufficient publicity being given through all the media so that people are forewarned that they will have this disturbance for a period.
In view of the escalating costs of fuel, has consideration been given to reducing the programme of low-flying training? Could my hon. Friend have the programme carefully examined? After all,

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it is being determined by senior officials who, worthy though they are, must be biased in favour of the maximum amount of training. Could people who are not directly involved with the programme but who have the expertise to advise, assess the programme?
I should like to express my concern about another matter—British pilots seconded to the air force of the Sultan of Oman. Will my hon. Friend reconsider the way in which our resources are being used? What other regimes are we helping to retain in power by the use of our manpower and equipment? I question their use in Oman, and I wonder where else they are being used in this way.
6.42 p.m.
Mr. Neville Trotter: It is a sobering thought that in the review of the Royal Air Force we hear of nothing being done to strengthen its front line that was; not already in hand and planned before the review started. I find it odd that in a fundamental review of this nature nothing could be found that needed additional attention.
Labour Members have spoken of the need to maintain the quality of life in this country. They say that we must not lower our standard of living by defending ourselves. But I ask the House to consider what it is that leads those in power in the Soviet Union to lower the quality of life in that country even more, in order to maintain massive offensive weapons, many of which are aimed at the people of this country, who, as we all know, have no desire to go to war, and least of all to attack the Soviet Union.
I believe that, sadly, the ordinary people of the Soviet Union do indeed believe themselves to be under threat of attack, but the leaders in the Kremlin, who are hard-headed realists, are well aware that the picture of that danger which they possibly put forward could not be accurate. They encourage people in the streets of the cities of the Soviet Union to believe this myth because it allows them to justify excessive arms expenditure. I do not believe that we have reached a poverty level that prevents us from defending ourselves, when the public choose to spend more on smoking and drinking than they do on defending our way of life.
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I do not know how the figures for the RAF's future expenditure are arrived at, but the more one reads of the Defence Review the more one feels that the balance in total between the Services had to be maintained, and that each Service came out with more or less the same overall percentage of the cake as before.
As the RAF must have a great deal of expenditure on new equipment if it is to survive, its cuts came mainly on the manpower side. Owing to the successful streamlining carried out, particularly under the present Chief of the Air Staff when he was the Commander-in-Chief of Strike Command, the RAF had already removed all the fat. It was a very streamlined and effective organisation. Therefore, we are now talking about cutting the effective part of the Service and not the overheads or the tail.
The geographical position of this country gives rise to an extremely difficult problem for the RAF in particular of the three Services, because we are at the interface of NATO, between the maritime and the land front. It is very much to the credit of those who have led the RAF that we have so notably contributed in a wide variety of ways to the air defence of the NATO Alliance. I hope that we shall continue to be able to spread our resources against the various threats in the future. It is much simpler for the German Air Force, for example, because it can concentrate on the battlefield of the centre of Europe. We cannot do that but must continue to look also at this maritime threat.
I turn to the Nimrod, which has already been mentioned several times. I think that it was the Under-Secretary who suggested that Lord Carrington, when Secretary of State for Defence, removed the Nimrods from Malta. That is true, but I believe that he moved them only a few miles, to Sicily. He did not bring them home to Britain but kept them in the Mediterranean. As the Minister does not intervene, I take it that I am correct.
If we look at the cost of the Nimrod force in the commendably detailed figures given in the White Paper these days, we see that it is said to be £49 million. If we are to disband a quarter of the force, as is suggested, the saving will be a paltry £12 million—a very small sum, bearing in mind the extremely important

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rôle of the squadron in the Mediterranean, which is undoubtedly the most unstable and insecure part of the whole NATO Alliance. Admiral Means-Johnston, the commander of NATO's southern flank, has said that he very much regrets our decision to weaken our contribution.
When we look at the men of the RAF, as of the other Services, we have no cause for concern. The quality and morale have never been higher. But I wonder whether the Minister was correct when he seemed to suggest that by cutting the strength of the RAF we shall improve promotion prospects.
Mr. John: That was in relation to some trades. Perhaps the hon. Gentleman did not quite follow the argument, which was that because of the excess of chief technicians in the technical trades, who are engaged to the age of 55, and who were taken on when a Conservative Government of long ago had other defence priorities, they were blocking the promotion prospects of younger NCO's who found that they could not reach the chief technician grade for many years.
Mr. Trotter: I accept that the Minister is right in saying that there was a surplus in certain of the senior technical ranks of non-commissioned officers. But I do not believe that his solution of reducing the total strength of the RAF is right. One does not cut down the RAF to solve that problem but restructures it. One does not have to reduce the overall strength in order to improve the promotion structure.
I believe that the air defence of Great Britain is one of the prime matters for any defence Minister. We should be very worried by our present lack of defence. I think that I am right in saying that the front-line strength of the RAF in this country is less than a hundred aircraft, an incredibly low figure, and that there are more United States Air Force fighters and bombers in Britain than there are operational RAF fighters and bombers here. That is an extraordinary state of affairs. I invite the Minister to intervene if I am wrong. In short, we are very dependent on the United States for the defence and safety of Great Britain. The whole question of the air defence of Great Britain
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requires not only more attention but more money. It cannot be improved without spending more.
In the debate on the Army Estimates, I suggested that, having taken the wrong decisions, as I thought, to cut the Army, we had open to us various ways of deploying the manpower. Dealing with the RAF, I do not think one can suggest an alternative. One can simply say that the cuts have been too great. I am quite prepared to suggest today that more money should be spent on the defence of this country in the air.
Ground radar stations are today regarded as being more and more insecure in view of the highly sophisticated forms of warfare that we have seen in other parts of the world, involving missiles which home on to radar transmissions. With the threat of commando attacks, the ground radar stations, of which there are very few, are extremely vulnerable. It is no good the men being underground and secure in their bunkers if the tons are blown off their radar transmitters. It is rather like a flower with its head off. The answer must lie with an airborne early warning aircraft of one sort or the other. I hope that we can provide a British answer to the problem. The Government would be required to give a very satisfactory explanation if they were ultimately to suggest that we bought American aircraft for this operation. The need, however, is unquestionable.
I was told in answer to an earlier Parliamentary Question that our Gannets are 20 years old and so are the Shackletons that are used at present, for airborne early warning. I understand that the Shackletons are being resparred so that they will not fall apart and we can keep them in the air. But they cannot be regarded as satisfactory front-line radar defence in this country. They are aircraft that are long past their best days.
I suggest to the Minister that the whole question of the reserve concept, which is applied so successfully to the Army, should be looked at again in terms of the RAF. It is many years ago that the RAF disbanded its auxiliary squadrons on the grounds that planes such as the Hunter were too complicated and technical to be flown by or maintained by auxiliaries. Last year I spent a most

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interesting weekend with the American Air National Guard in Colorado. There they are flying—and flying extremely ably and competently—and maintaining to a high standard an A7 Aircraft which is the equivalent of our new Jaguar. They are being issued with brand new aircraft. If units in America of an auxiliary nature can operate aircraft of that complexity, that might be one way in which we can get more for our money in this country.
I commend to the Minister that further thought should be given to the possibility of an increased use of auxiliaries. From the figures in the White Paper it seems—unless a decimal point has been put in the wrong place—that the volunteer and auxiliary strength of the RAF is 300 men and women. It is incredible. I thought that the 8,000 in the Royal Naval Reserve was low, but 300 for the RAF is simply incredible.
Turning to the details of the White Paper, I regret to see that the medium-lift helicopter for the Army has been cancelled. I should have thought that we were unlikely to obtain the maximum benefit from the use of the Harrier with its unique VTOL capability, unless it were supported by at least medium-lift helicopters.
In the transport force there has been talk about the use of civil aircraft. I suggest to the Under-Secretary of State that we need to consider the sort of programme that the Americans have adopted whereby civil aircraft are being converted out of defence funds so that they can be used for freight. For it is not just men who will have to be carried to Germany or wherever but also equipment without which the men will not be effective. Most of the equipment could not be carried in an ordinary civil aeroplane. In America they have fitted freight doors and strengthened the floors of a large number of civil aircraft in order to increase their military lift capacity.
Turning to the RAF Regiment, I was sorry to read that it appears to be if not under threat of extinction, at least under threat of considerable cutbacks. We are told that at present—that is, outside Great Britain and Germany—it is stationed in Northern Ireland, Oman, Hongkong and Belize. None of those appears to be a place from which we
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are to withdraw and I should have thought that the case for cutting its strength was therefore very limited indeed.
Turning to weapons, there is singularly little to suggest that we are entering into the new generation of weapons that we have seen used so effectively in the Israeli war, such as all forms of smart bombs and smart missiles. To release a conventional bomb today and to hope that it will achieve its objective is practically useless. I stress that we should, either independently or in concert with our allies, develop rapidly the new generation of sophisticated weapons. There is no point in having a sophisticated aircraft at great cost if, when it arrives at its target, it has only an old-fashioned bomb to release. Far more effective use could be made of costly planes if the weapons that they carry were equally sophisticated.
On another matter, may I say that I cannot understand why the Minister will not publish the low-flying routes. I am sure that there must be some explanation for it. I cannot think that politics could enter into it. Surely it is perfectly reasonable to publish for those in civil aviation the routes on which low-flying takes place. I do not want to be told that the Russians are unaware of them or that it is a very serious military secret.
I should like to say a little about housing, a subject of general concern at all times to those coming out of the Forces, and of particular concern at a time when there is large-scale redundancy, especially in the RAF. Circular 54/75, which was recently issued, is full of platitudes beseeching local authorities to give to those coming out of the Services the fair treatment that they deserve. I am not convinced that the Government have shown enough determination in this respect. There are too many instances of local authorities saying to those coming out of the Services, "You have not lived here before and therefore you count very low indeed in our priorities for allocation of a council house". These people have lost their roots and their jobs and they are very much in need of help.
It is distressing to think that there can be cases in which they are in danger of being put out on to the street. I believe that there are some councils, which, until ex-Service people are put out on to the

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streets, will not give them any help. More sympathy must be shown by local authorities, particularly at this time, to those coming out of the Royal Air Force. I hope that the Minister will assure us that if this circular—as I fear will be the case—does not prove to be effective, he, in concert with the Minister for Housing, will ensure by further efforts that the problem is satisfactorily dealt with.
6.59 p.m.
Mr. James Tinn: It is always pleasant to be able to express agreement with something that has been said by the Opposition. Unfortunately, with the present Opposition, it becomes increasingly difficult. Therefore, I am particularly glad to be able to express my complete agreement with a great deal of what has been said by the Opposition, and indeed by some of my hon. Friends, about the importance of standardisation in NATO. This is a massive, urgent problem and it is my suspicion that probably no other single factor detracts more from the effectiveness of NATO as an alliance and as a deterrent against aggression. It does not need back-bench Members on either side to draw the attention of Ministers to this problem. They are only too well aware of it. I think that they would be glad to have solutions from us, but I cannot come up with any this evening.
I am glad that the multi-rôle combat aircraft will help, particularly if it is sold to our other allies in NATO, apart from Germany, Italy and ourselves. That would have the tremendous advantage of simplifying servicing, supply, and interchangeability, and it would enable our units to go from one country to another without the logistic and other difficulties which apply now. I shall have more to say about the MRCA later.
When a Labour Government are again under attack for alleged neglect of defence, I think that I am entitled to remind the House that a Labour Government initiated the development not only of the MRCA but of the Harrier, to which constant tributes have been paid. This is the other side of the coin which entirely and fittingly rebuts the accusations so frequently made or implied by hon. Gentlemen opposite that we in some way neglect the Armed Forces.
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I entirely reject arguments by any of my hon. Friends which imply that the Labour Party is or ever has been a pacifist party, or even a party for unilateral disarmament. That is simply not so, whatever some—a minority—of my hon. Friends might wish it to be.
I refuse to regard defence as a soft option or an easy target for cuts to avoid having to make cuts in other areas where they obviously might be more directly painful. Our own manifesto—as a member of the manifesto group I am never without my copy, and I read it from time to time—points out that
"The Labour Government will maintain its support for NATO as an instrument of détente, no less than of defence."
That has been repeated time and again. We have never said that we would reduce defence expenditure by absolute amounts, or at particular levels. We undertook to carry out and
"press forward with our plans to reduce the proportion of the nation's resources devoted to defence so that the burden we bear will be brought into line with that carried by our main European allies."
That is fair. That is precisely what the Government are doing and why they have my support.
The Opposition's reaction has been exaggerated, and if they vote tonight it will be exaggerated to the point of absurdity. They have repeatedly stated that defence is the primary consideration, overriding almost all others. Clearly in time of war or of imminent threat that is probably true, but in time of peace a balance has to be struck with other considerations.
The relative importance of defence must vary with our assessment of the present political climate and the likely trend of international affairs. Obviously defence will have a higher priority if our assessment becomes rather more pessimistic. Whilst I shall always support my right hon. and hon. Friends in the Ministry of Defence to resist arbitrary, damaging and dangerous cuts, I do not think that defence, any more than any other area of public policy, can be regarded as a sacred cow. I believe that the Government are honouring the promise that was fairly given to and taken up by the electorate.
I intended to refer to some of the points made by my hon. Friend the Member for

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Salford, East (Mr. Allaun) but, as he is not in the Chamber, I shall not do so. However, following some of his remarks, I should like to express the strong view that, contrary to what he and others sincerely believe, a reasonable defence budget can contribute to disarmament negotiations. Indeed, the Russians are hardheaded people. If we go into the negotiating room with the Russians, having already played our cards and hoping for a similar response from them, we shall come out with a very bad bargain. We must retain some of our cards. We cannot afford to affect the balance adversely in the hope that they will redress it.
Reference has been made to the Middle East war. The trouble in the Middle East was neither caused nor could be defended by the absence of British arms. I should like to make a personal point about the arms industry. I can understand those who attack it as immoral and apply such epithets to it. Yet, if we are not to be entirely dependent on other countries for our defence requirements, and since the cost of modern arms development is such that a single British aerospace industry, for example, has no chance of being viable, we must indulge in the arms export business. I regret it as much as anybody else, but it is an unfortunate fact of life.
I sometimes think that as we are likely to remain in that business we should be more clear sighted in some of our policies. I do not believe that we can sell arms with clean hands and an easy conscience. We cannot soothe our conscience by fastening strings to arms sales, saying "We will not service, supply ammunition, spare parts, and so on, if we disagree with the use that is made of the arms."
Perhaps I am straying too far from the immediate subject of the Government's proposals regarding the Royal Air Force. As an ex-RAF man I should be among the last to defend these proposals if I felt that they were likely to damage the Service. As the Minister pointed out and will no doubt amplify later, this process of reducing our commitments, which was promised in our manifesto, has been carried through. But I take it badly from the Opposition, who always speak of our cuts as if we had done nothing to reduce the burden on the Armed Forces. During the period of the previous Labour Govern-
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ment, as well as this one, we consistently tried to reduce our overseas commitments, confining them increasingly and now almost entirely to our proper rôle in Europe. In nearly every instance of such a withdrawal we have been opposed by the official Opposition, who would presumably have liked us to continue to carry a burden totally disproportionate to our strength, and, in present circumstances, quite beyond our ability to carry.
I shall mention in passing one well-known success story—the Harrier. We are entitled to make more of such stories. Those who have seen the Harrier have been tremendously impressed by it. The multi-rôle combat aircraft is, to me, an even more exciting concept, and I congratulate the Government on their firmness in going ahead with this project despite the discouraging probing of some Opposition Members about alleged defects in the engine and an alleged falling behind in the programme.
Mr. Tebbit: Surely, if this House is funding a programme to the extent that the MRCA programme is being funded, it is nothing less than right and proper that when there are reports of serious defects these should be put to the Minister in order that he may say in public whether they are true or false. Surely, if any of us failed to do that we would be in dereliction of our duty.
Mr. Tinn: Of course, but in probing, quite properly, for possible weaknesses in a project like this, it is as well—if one is not to sell short the three-nations consortium—that a little time should be taken to study what has been achieved already. I regard it as a most remarkable feat of international co-operation, well within the time-scale and cost estimates when compared with other projects in the aerospace industry. Incidentally, it has provided a great deal of work in all three countries concerned.
I should like to mention two matters in closing. The first is the problem of low-flying aircraft. There is a film showing the training programmes of the RAF, which many of us find extremely interesting. I suggest to my hon. Friend that if such a film were to be shown on television it would help to explain, to people who have to suffer the nuisance, why it is necessary.
Mr. John: I thank the hon. Member for that suggestion. There is as yet no television film, but there certainly is an information film available for showing in affected areas, to explain the facts to the community concerned. I am grateful for this opportunity to draw that fact to the attention of hon. Members whose constituents are affected by low flying. There is an opportunity to show that film in their localities to explain the nature of the problem.
Mr. Tinn: I am delighted to hear that from my hon. Friend, but I urge upon him again that consideration be given to extending the showing to television, which would considerably increase the coverage.
Finally, though this should more properly be addressed to my right hon. Friend the Secretary of State, there is the possibility of some units in NATO being earmarked and especially trained to be ready to play a disaster rôle, not only in Europe but in other parts of the world. I believe that some study could be made of this, and that there is a real possibility here. In this debate it would be wrong for me to take time in developing the idea, but I put it to my hon. Friend as a suggestion for consideration. I think that the public relations impact, particularly on those of my friends who have considerable doubts about the value we get for the money spent on defence, would be significant. I can think of no single step that would have a better public relations impact.
7.15 p.m.
Mr. Anthony Nelson: It is to me a strange thing about the House of Commons that I increasingly find myself in agreement with the analysis and content of so much of what is said by Labour Members, and yet am diametrically opposed to their conclusions. This is not less true of the debate this afternoon. Curiously enough, I found some of the comments of the hon. Member for Salford, East (Mr. Allaun) most persuasive—particularly his analysis of the nuclear threat and its possible spread to currently non-nuclear countries, his concern at the growth of Communist military power, and the undesirability of certain forms of armaments transactions. I have a degree of sympathy with what was said, yet we seem to draw exactly opposite
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conclusions, and no doubt we shall file into opposite Lobbies at the end of the evening.
I think that this is a particularly important debate, and I welcome the Opposition's decision to divide the House this evening, for I believe that the impact of the cuts in RAF expenditure has not been appreciated; and that those making them have failed to recognise the pre-eminent rôle of the RAF as an integral part of our defence system.
I should like first to go back to the point made by the Minister in his opening remarks in the debate, when he said that expenditure on defence should in all cases be balanced against a concept of the "quality of life" in this country. This was mentioned by a number of my hon. Friends during this debate, but it seems to me that it is not so much a matter of the quality of life being at stake as the continued existence of life and of freedom in this country. Those are prerequisites to any other policies which the Government might have.
I consider that there is a fundamental rationale for the priority of defence policy: it is, in effect, the original contrat social. People donate to a Government or to some other authority the responsibility to defend them. It was the basis of our early feudal system that the landlord would be given the right to govern his people but would defend them. It is no less true in a sophisticated civilisation such as we have developed. We should put our defence before any other policies of government. It is a prerequisite to all other ambitions that Governments might have. They must adequately safeguard the defence capability of their people and their interests internationally.
There are three fundamental arguments which go to support a continuing development of our defence capability, particularly with regard to the Royal Air Force, in the present circumstances. The first and foremost is that it is impossible, in a situation of potential conflict, to rearm in a short time. Many times in our history we have heard people calling for cuts in defence, yet we should know from experience that it is increasingly difficult to rearm to the level necessary in a short time. There have been many who have spoken from the wilderness

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calling for an adequate capability, sometimes against the priorities that the public may have for social needs. Fortunately, in the past it has not proved too late, but in the future it might. We should consider means of preserving our defence capability, even though we have to recognise that the present Government are going to make substantial cuts.
I have questioned the Minister a number of times on the mothballing of aircraft and of other facilities. This is a suggestion that was put to me by a constituent. While it may seem to be a fairly simplistic solution to the problem I have just outlined—the difficulty of increasing capability in the short term—it is important to consider it, especially for the fixed-wing element of the air force, where its costs might not be as large as is sometimes suggested. There are storage facilities available for mothballed aircraft and there is the technical ability, which at the moment is to be made redundant, to enable their service capabilities to be maintained.
What is more, with the reduction in the number of operational stations by 12, we should not easily give up the airfields of these bases. There have been various suggestions that some should be returned to agricultural use or be used for other development purposes. Even if the Government let this land go beyond the claims of other Defence Departments and beyond the Property Services Agency—to local authorities or to commercial use—they should consider exercising careful control over the use of these airfields, and their potential future use for military purposes should be retained.
The second reason for the preservation and improvement of our air capability has been well enunciated. It is the well-documented increase in the Soviet capability in new parts of the world. No one should be deceived into thinking that this build-up is for ceremonial purposes. I am especially alarmed by recent developments in Africa and the implications of certain individuals controlling nuclear capabilities available to their countries. I believe that within my lifetime I shall see every country having a nuclear capacity. This is a very frightening prospect, and although I agree with the hon. Member for Salford, East that this is a matter to be regretted, draw the conclusion that if we fail to
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maintain such a capacity ourselves, and if we cut away the RAF's conventional capability, we shall seriously reduce the nuclear threshold. This is the critical point. The stage at which the button would be pushed would be an earlier point of time than if we maintained the capability of the air force, especially that of Strike Command.
I believe also that the support and strike rôles are fundamental to the success of ground and maritime capabilities. These have been emphasised with regard to Nimrods in the Mediterranean. But the wide variety of rôles undertaken by Strike Command at the moment is evidence of its integral rôle in our overall defence capability—a rôle which is well worth retaining.
I mention one other matter which has been touched upon but not analysed in great depth—the question of the American involvement. Any observer of the American political scene will readily admit that there has been a switch in their foreign defence philosophy, that recent events both in the Middle East and Vietnam have made them look very much towards their own borders, and that charity for them is also beginning more at home.
In this situation, we may well see a reduction in the number of United States aircraft stationed in this country. I know that there is congressional pressure for this, and this would obviously alter the balance between the number of American and British aircraft in this country. This potential withdrawal of support will inevitably affect NATO. We should take more account of that in formulating our air defence policy.
I come now to the impact of these defence cuts on my own constituency. RAF Thorney is sited at the southern end of the Chichester constituency and is one of the stations due for closure under the defence cuts. Many hon. Members will know this station, which has existed since 1933. It has served the country well in a variety of RAF capacities. After a certain Sergeant Hodge crashed there in his Fury aircraft, it was pointed out, during investigations that this would be an appropriate site for setting up a station. In the 1971 Statement on Defence it was recognised as a station of unique strategic importance and there has been nothing since to change that judgment.

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We heard earlier that uncertainties had now been reduced to a minimum. At RAF Thorney that is not the case for the military personnel, for the civilian employees or for the many people living in the surrounding area who will be affected by any alternate use of the station.
Last Friday, I was privileged to visit the station. I thank the Under-Secretary for making that possible. I am also grateful to the commanding officer for extending so much hospitality and useful information to me.
Once we got down to looking at the impact of the cuts, it became obvious to me that they would give rise to grave problems on a number of RAF stations. I was most alarmed by the extent of the ignorance amongst the Service personnel about their future deployment. As I say, we heard earlier today that the uncertainties had been reduced to a minimum. However, it is my view that 50 per cent. or more of the Service personnel—certainly the officers—have no idea where they will go. That applies from the bottom right to the top. Even the commanding officer has no idea where he will be sent.
I recognise the problem involved in redeployment, in redundancy and in notifying people. It takes time, especially when it is subject to such an extensive review. But I believe that the department in the Ministry of Defence which has specific responsibility for co-ordinating postings should make renewed efforts to indicate to Service personnel as soon as possible what their postings are likely to be. This uncertainty has had a damaging effect on morale, and the increasing number of people who have families, housing and schooling problems and who do not know where they will be sent, presents a very serious situation.
The housing problem is especially important. Whereas in the past a young Service man was able to wait until he retired, having saved sufficient money to purchase a house, nowadays he has to make such a purchase very early in his Service career. It means that he is far more tied down than was the case in the past. We have to recognise that more consideration must be given to the needs of Service personnel when thinking in terms of transferring them from one posting to another.
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There are very severe problems for the 200 Ministry of Defence civilian employees at RAF Thorney who will probably be made redundant. Little indication has been given to them about any alternative employment which may be available. Although I understand that in the course of discussions in Whitley Councils the greatest efforts are being made to give such indications, there has been little progress to the satisfaction of those civilians.
I cite two examples. The first is that of a local lady who recently won a commendation for long service. She is a barmaid at 46 Squadron. She has been offered no alternative employment. The second example is that of a man who is 78 years old. He has been at the station ever since it was founded, and is storekeeper there. He, too, has no alternative employment—although someone may be rude enough to say that he has no reasonable claim to any—but he is providing a useful service at RAF Thorney. It is disappointing to see people who have been so concerned with safeguarding the morale and efficiency of these stations being made redundant in this way.
I also draw attention to the problems faced in my constituency in respect of RAF Thorney—and obviously the position is the same elsewhere—about the alternative use of the airfield. There is the obvious fear amongst local people that it will be used for an extension of civil air transport use from nearby conurbations. But I hope that consideration will be given to an alternative military use for RAF Thorney, and I seek some assurance on the matter from the Minister.
I am particularly hopeful that the Royal Navy helicopters from Lee-on-Solent, which I believe are at capacity there, will expand to RAF Thorney. I would prefer to see this rather than any extension of civil air transport use. I also hope that any indication of what will happen will be given at the earliest opportunity and after the fullest consultation with the local authorities.
The closing down of a station—in my case a RAF station—has a fundamental effect on a community, on the services, employment and many other local factors which should be carefully reorientated over a period and which should be subject to detailed review and planning with the

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local authorities. In RAF Thorney we have a fine Norman church which was previously used by the inhabitants of the village there, who have gradually disappeared with the growth of the RAF station. At that Norman church we have a large number of Commonwealth war graves, which are well maintained by the Department of the Environment. It is on matters such as this that we must seek assurances that, for example, the Department will continue to exercise responsibility for the maintenance of the graves. There must be assurances that there will be detailed consultations with the local authorities about the alternative use of local churches and other facilities, such as schools. There is a Service school at RAF Thorney with capacity for 150 children.
There is also the question of the alternative use of married quarters at RAF Thorney. There are 170 married quarters and 39 arrangements with private tenancies outside the station. Any alternative use of these should be integrated in the long-term plans for such a station. The problem arising at this station is that of the timing of an alternative use; for example, the extension of the helicopters from Lee-on-Solent will take approximately two or three years. This leaves a fallow period when all the civilian staff will be made redundant and when the married quarters and the private tenancies will be utilised, possibly by people on the housing list or by other private tenants seeking accommodation.
With the input of an alternative military use we would need further housing to take care of the Service men and families. These problems of changeover and alternative use should be carefully considered. The public and Service men should be given greater assurances. Such moves radically affect the nature of employment and the quality of life in localities.
I draw attention to the particular squadrons which will be disbanded and deployed from RAF Thorney. I do so because it is fitting that squadrons with fine histories and a heritage of tradition should not be allowed to be disbanded without some mention of their honourable conduct and service to this country. I think particularly of the No. 46 Squadron, set up in 1916. It has served a variety of rôles in the conduct
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of this country's defence, and it fought in the Battle of Britain. It is a squadron that is currently equipped with Andovers. I was particularly pleased that the hon. and learned Member for Montgomery (Mr. Hooson), among others, mentioned the important rôle of the Andover.
I am disappointed that 39 Andovers in the Service are to be got rid of. The Andover is a well-tested and well-tried aircraft. It is capable of landing on rough terrain, which is a particularly important capability in the rôles of battlefield support or aero-medical evacuation. When considering a reduction in the number of Andovers as an integral part of the overall cut in the fixed-wing element of Transport Command, we should carefully analyse the reasons presented to us today by the Under-Secretary for such a reduction, and the assurances given. He said that the reduction would be an even one, balanced against the withdrawal of our presence from overseas bases. It is important to realise that the majority of the operations of this squadron, which operates Andovers, take place in this country or are concerned in supplying NATO—to which our defence capability is not to be substantially reduced—or are Mediterranean operations. Only a minor part of the operations are east of Suez and in other non-NATO commitment rôles.
Secondly, the assumptions behind a 50 per cent. cut in Transport Command every year do not seem to be in line with what the Minister was saying about the even reduction in this capability. I do not see how, when it will take somewhat longer to reduce our non-NATO obligations, it will be possible to cut Transport Command by 50 per cent. in one year. This point seems to be left open. I was not reassured by the statement that we may just be able again to do the same thing as we did in Cyprus, but only just. I question whether, given events in Africa or some other part of the world, we would have sufficient capability.
With the situation as it is in an un-named country at the moment we cannot ignore the possibility of having to mount some rescue operation for a substantial number of British citizens in which the RAF and Transport Command would inevitably play an important part. The House would appear silly and shortsighted if we were to ignore that possibility.

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I come to the question of defence lands. This is a problem I came across particularly in Singapore. I spent a good deal of my life living on RAF bases, travelling round the world. I was in Singapore for a while. When we withdrew substantially from that island I was concerned about the fact that insufficient publicity was given in the United Kingdom to the transfer of lands owned in that country. I would ask for some explanation or assurance that important and valuable British assets in these countries, such as RAF Changi and Seletar, in Singapore, will not be relinquished as a latent form of aid, given over immediately to the country.
It is important to realise that generations of Britons have served in those countries, building up a defence and a prosperity for them. It is proper that we should benefit to some extent from the realisable commercial value of those lands. If charity begins at home sufficiently for us to withdraw our forces east of Suez it is proper that we should consider these commercial interests, which are sometimes overlooked.
I am disappointed about the comments made about the aircraft industry in Europe and the prospects for employment on bases. Although I have mentioned civilian employment in my speech, the starting point for any rational, sensible debate on defence capability should start with the priority nature of defence rather than the fact that it gives employment to the aerospace industries of Europe or to local personnel. They are, however, relevant factors to be considered in deciding the method by which defence cuts are implemented. It is disconcerting that the defence decisions seem to have been based to some extent on questions of civilian unemployment. I quote from a letter I received from the Under-Secretary, who said, on the subject of RAF Thorney:
"We have now concluded our consultations with staff associations concerned and I am able to confirm that deployments are to go ahead as planned."
That seems a strange sequitur, that the future of the station and its important defence capabilities should follow discussions with the local trade unions. I realise that the method by which deployments are undertaken may be a conse-
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quence of that. Perhaps it was just a sentence which was badly put, but I would like an assurance from the Minister that while employment for our people is important he will not lose sight of the priority criterion of defence for our people.
Allegations are made on numerous occasions that the Opposition put forward defence policies that are incompatible with their overall opposition to the Government's conduct of our economic affairs. It is said that we are incapable of financing that which we proffer. I said earlier that I think it proper that we should give the highest priority to the defence of our people. It should be a priority above the fraudulent use of thousands of millions of pounds of taxpayers' money for food subsidies. It should be above policies which increase council house deficits, and policies which require large sums to be expended on nationalisation through the National Enterprise Board. These amounts, of billions of pounds, about which we speak so glibly, are increasing.
We must get our priorities right. The policy of the Opposition is clear. We abhor the extent to which food subsidies continue to exist. Some of those policies may be beneficial as temporary, tiding-over measures. However, in the longer term we must ensure that adequate defence is maintained and that we do not continue to support the allocation of taxpayers' funds on fraudulent policies which enable people to believe that goods are cheaper than they are, when money could more usefully be spent on defence. Defence is an insurance, upon which none of us want to claim, but we should always make room to afford to pay the premiums.
The motto of the 46th Squadron is "We rise to conquer". I hope that under a future Conservative Government that squadron will have that opportunity.
Mr. Michael McNair-Wilson: On a point of order, Mr. Deputy Speaker. Was it in order, when a debate is to be answered by the Minister who opened it, for the Minister not to be present while my hon. Friend made his important speech?
Mr. Deputy Speaker (Sir Myer Galpern): Strictly speaking, that is not

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a matter for the Chair. However, a Minister from the Defence Department is present and seems to be writing. He will probably report accurately what is said while the Minister who is to wind up the debate is absent.
7.42 p.m.
Mr. Norman Tebbit: I wonder whether any hon. Member wanders through this place late at night when it is dark or dimly lit and wonders whether there are any ghosts here. I do not refer to the ghost of the hon. and learned Member for Montgomery (Mr. Hooson), who came here, rattled his chains for a few moments, and then rattled out. That ghost disappeared as Liberal ghosts tend to do. Nor do I refer to the ordinary phantom Government back bencher who came in and then disappeared leaving a vacant sea of green leather on the Government benches. There was even the ghost of the Under-Secretary of State for Defence for the Royal Air Force, who spoke and then disappeared, leaving the Under-Secretary of State for Defence for the Royal Navy to look after the debate on the Royal Air Force. The integration of the Services is a great principle, but I think that it could go a little too far.
I wonder whether any ghosts of past Members are here. If so, they must listen to our debates at times sadly and grimly. The thought in their minds must always be that no one ever learns anything from history—except that no one ever learns anything from history. Let us perhaps try today to learn something from history. Let us start by looking back 50 years, as I did earlier today.
Fifty years ago, we were so complacent that we had run down our air force to one-tenth of its size seven years earlier at the end of the 1914–18 war. In 1923 there were eight Royal Air Force squadrons in Britain, three of which were allocated for home defence. That alarmed even this House. A five-year programme was launched to create a home defence force of 52 squadrons in the ratio of two bomber squadrons to one fighter squadron, or, as we should now say, two strike aircraft squadrons to one air superiority squadron. Events moved on from 1923. There were talks which were the equivalent of the balanced forces reduction talks and the SALT talks. They
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culminated in the discussions and the signatures at Locarno in 1925. Even that programme, on which the country had embarked in 1923, was slowed down. The completion date was put back from 1928 to 1936.
The economic crisis of 1931—which before long, we may think trivial compared with what is coming to us—brought further delays. By March 1932 there were still only 42 squadrons, of which 13 were auxilliary squadrons, with 488 aircraft in all for the defence of Great Britain. That was the background to a debate to which I should like to refer.
That debate took place in July 1934, which is 41 years ago. The debate in the House of Commons on 30th July arose from the announcement earlier that month in the other place that the Government intended to increase the size of the Royal Air Force by 41 squadrons within five years. I read the speeches in the official record of Mr. Baldwin, the Government spokesman, and Mr. Attlee, who spoke for the Labour Opposition. I also wondered who had read this volume before I had and who had made an ink marking alongside one or two passages in those speeches. I turned, I think it was, to column 2350 of the Official Report.
Mr. Deputy Speaker (Sir Myer Galpern): I hope that the hon. Member's ghosts are not letting him down.
Mr. Tebbit: Mr. Attlee said:
"We deny the proposition that an increased British Air Force will make for the peace of the world, and we reject altogether the claim to parity."
Mr. Attlee was followed by Sir Herbert Samuel, who led for the Liberals, as the hon. and learned Member for Montgomery led for the Liberals today. Sir Herbert Samuel said, with admirable pugnacity and patriotism,
"If then our Air Force were to be found out-numbered, out-distanced, ill-equipped and ill-trained, what conscience would any of us in this House have if we had sent out our men to face the perils of such a conflict in those circumstances because the Members of the House of Commons had not the courage to provide the finances which were necessary?"—[Official Report, 30th July 1934; Vol. 292, c. 2349–55.]
That question was asked by the Leader of the Liberal Party in 1934. He then

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led the Liberal Party into the Lobby against any proposal to provide the aeroplanes. Plus ça change, plus c'est la même chose.
The Labour Opposition also voted against the proposal.
I commend the passages which I have quoted to Government supporters. In that debate Mr. Baldwin coined the phrase that the frontier of Britain was not on the Channel but on the Rhine. In that debate, my predecessor, the hon. Member for Epping, pointed out that Britain had become like a great fat cow waiting to be seized as prey by any predator because we had neither the courage nor the ability to defend ourselves.
Living in the past is, indeed, a form of living death. Learning from the past is a prerequisite for survival. So we have to ask ourselves how the past is reflected in events today. One thing is certain. There is a consistency about the policies of the Liberal Party. There is also a consistency about the politics of the Left. The politics of the Left, then as now, was divided into the politics of what is sometimes called the moderate Left, but which I prefer to call the wet Left, and the sinister Left. The wet Left is never short of good intentions with which to pave the path of the sinister Left. The wet Left is always against rearmament for all manner of self-indulgent, day-dreaming, good reasons. The sinister Left—the Marxist Left—is always dedicated to the destruction of the capability of this country and its allies to defend themselves.
From time to time, we hear from the Left cries about the fight against Fascism or Nazism. Let me remind the House that the wets and the Marxists alike opposed giving Britain the means of defending itself in the 1920s and the 1930s, they oppose it again today and they will oppose it every day. Indeed, the wets and the Marxists split on this matter only on the very eve of the 1939 war. As Hitler marched into Czechoslovakia, the wets gradually began to dry out, but let us remember that in 1940—but 35 years ago—their sinister friends were still booing every time a German bomber was shot down and cheering every time one of our own aircraft fell in flames. That was their fight for
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Britain until their masters, the Russians, were precipitated into the war by an attack on them by their ally, Nazi Germany. For the Marxists the battle for Britain was not Britain's finest hour, because we won.
The first lesson of past events is that we can trust neither the Marxists nor their wet Socialist allies, however good their intentions seem to be on the day. The second lesson, which must have been learnt so many times through human history that it seems inconceivable that we can ignore it again today, is that it is not strength that begets aggression, it is weakness that begets aggression.
That has been put well enough. I am no user of Latin tags, but my hon. Friend the Member for Chichester (Mr. Nelson) mentioned the motto of the 46th Squadron. I served for a long time in 604 Squadron whose motto was Si vis pacem para bellum—if one wants peace, prepare for war. There is the converse—if one wants war, prepare one's country only for peace.
Looking back to 1934, by comparison with today our position then was one of great strength. The Royal Air Force, weak as it was, outnumbered the German Air Force by three to two. By September 1939, despite the efforts of the Labour Party to prevent our arming ready for war, the enemy threatened our home force of 1,476 aircraft with his 3,609 frontline aircraft and 522 transport aircraft. The fighters were an even match and the tactical strike aircraft of the Germans were better than ours. Our heavy bombers were superior to theirs, and we had the immense technical advantage of radar which they had not. Their anti-aircraft artillery vastly outnumbered ours and was superior in quality. In addition, the French had a considerable, if obsolescent, air force.
We should contrast that situation of dire peril with that in which we live today. Our situation today is infinitely worse than it was then, and that was the circumstance which led this country closer to defeat, invasion and subjugation than it has ever been before.
Let us turn to the present day. My hon. Friend the Member for Hastings (Mr. Warren) detailed the numbers with admirable clarity. Our potential enemy is just as clear today as he was in 1934.

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There is no more reason to doubt his intentions—because they are published—than there was reason to doubt the intentions of Nazi Germany, because Hitler, too, had published his intentions. We are weaker now in relation to our potential enemy than we were then. Together with our allies we field as motley a selection of incompatible and non-combatable equipment today as we ever did in the past. On the credit side, through NATO and the EEC—both so bitterly opposed by the Left of the Labour Party—we have a better chance of a co-ordinated defence policy in Europe than we had 40 years ago.
In the 1930's we were slow to see that we could possibly use an understanding with Russia to ensure that there was always a threat on the eastern borders of our enemy. Today we—or the Government—are just as slow to appreciate that we could use the friendship which is offered to us by China as a means of ensuring a continuing threat on the eastern borders of our potential enemy.
When the hon. Member for Salford, East (Mr. Allaun)—who is not here now—quoted figures concerning the parity of arms between the West and Russia, he was quoting above all the arms of the United States. Perhaps he believes that in the circumstances we might envisage of a European war the United States is certain to come to our aid. I doubt it. I do not believe that we in Europe can rely on the United States for every picking up the tab for the defence of Europe. What is certain is that if China has powerful forces on her border with Russia, some of those Russian forces, which at the moment we are forced to count as being predominantly a threat to us, will have to be disposed on Russia's eastern borders, and that can be of nothing but benefit to us.
What can we do to improve matters from the sorry state in which they are today? First, as defence has already been singled out for massive and damaging cuts, and cuts additional to those which the Secretary of State himself said were the absolute maximum which could be endured, we should not seek to make any further cuts in the next series of attacks on Government expenditure. There is plenty of room for cuts in the nationalisation programme. There is plenty of room for cuts at the town halls
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and in the flabby bureaucracy that has built up about Government today as they proliferate their interference with every aspect of the life of the citizens of this country.
Secondly, we must seek a better understanding with our allies, and above all with France. We should accept much of the view which is held by France as to the relationship between Europe and America. France in its turn should take up a full share and a full part in NATO Together with our other allies, but above all with the French, we should end our national rivalry in defence sales. That rivalry weakens us both and serves only to profit the American industry.
Thirdly, if we consider the potential threats and look at them realistically, we must increase our maritime reconnaissance capability. We must do so urgently. We must increase our battlefield strike capacity and we must ensure that we can maintain air superiority over the battle field whilst the strike aircraft are involved in holding back the sort of armour which might be thrown across Europe.
At present we have nothing approaching the capacity to stop reconnaissance flights over any part of the battlefield or any part of the United Kingdom by aircraft such as the Russian Foxbat. We have nothing that can get remotely within 10,000 or 20,000 feet of its operating altitude. Further, we have no missiles to hang on the aircraft which can get within 10.000 or 20,000 feet of it to close the gap and destroy it. We do not have the capacity to protect the Jaguar strike aircraft when it is in action on the battlefield.
We must consider carefully the rôle of the MRCA. It was implied today that there was something faintly unpatriotic about pointing out that there could be any delay in the programme. Let me take the risk of being accused of being even more unpatriotic. Is the proposed air superiority version of the MRCA a fighter of the capacity of the F16 or the MiG 23? Could it meet an aircraft of that class in combat and defeat it? Are we purchasing missiles of the sort which would be needed so to do?
Some of those who fought only recently in the Middle East war, and especially on the Israeli side, say that it is the thrust-weight ratio which is of the

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greatest importance for dogfighting, for the air superiority rôle or for ground attack. They point to the fact that the MRCA may be too heavy and too expensive for the dogfighting rôle. I appreciate well enough that the MRCA is not a battlefield aircraft. It is not a dogfighting aircraft unless we talk of the air superiority version. That is why I have caution about going too far towards that version.
At the moment the MRCA is a deep penetration aircraft of very great capabilities, but is it too expensive? Is it to be the sort of aircraft which the air marshals dare not commit for fear of losing too many? Is it the sort of aircraft which is so expensive that we cannot have enough of them? I fancy that there may be a germ of truth in that. It is time that we looked at our defence capability not just in terms of what the Harrier, the MRCA and the Jaguar can do but in terms of what would happen on the battlefield when we used our aircraft in conjunction with those of our allies.
How can we discuss Jaguar's capabilities unless we discuss how good the French Air Force would be in protecting the air above Jaguar. A terrible expression was used when some colleagues and myself were talking recently to an Israeli Air Force General. He said "We saw the enemy attacking our forces and we fell on them from above". That to anyone who has ever had any training, let alone any action, in fighter aircraft has something about it that is frightening. The thought that our aircraft could be fallen on from above on the battlefield by the superior dogfightinfg aircraft of the Russian Air Force, against which we would have no protection, is of the greatest seriousness.
As regards equipment, we must question the ability of the tattered remains of our transport aircraft to supply our front-line strike aircraft with armaments or our defensive missile screens with replenishment in terms of a battle which lasted for more than hours let alone weeks. I am told that for several days during the Yom Kippur War on the Golan front there were up to 50 or 60 SAM missiles in the air at any one time. I doubt whether we have enough transport aircraft now, let alone whether we
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shall have enough after the cuts, to bring up supplies on anything like the sort of scale on which the Syrians and the Egyptians were using missiles on the Golan Front and at Suez during the Yom Kippur War.
Finally, we have to question the philosophy behind the small number of highly sophisticated aircraft as against the greater number of cheaper aircraft, especially in view of the scale of losses suffered by the Israelis in ground attacks against the armour of the Syrians on the Golan Front. They found that high-quality Russian light anti-aircraft guns in combination with large numbers of SAM missiles was deadly for their ground attack aircraft. There is no reason for us to believe that we would be able to field aircraft or pilots which would be superior to the Israelis in the Yom Kippur war, or that the Russian forces or the Warsaw Pact forces they might meet would be any less skilled than the Arabs whom the Israelis were fighting.
I doubt very much whether rationally we can justify the vague belief that somehow we shall muddle through and that we shall be able to destroy the Russian armour in a battle of the sort which was fought so recently in the Middle East.
I end by saying that we have depended on the United States for defence for 30 years. Our defence is no longer credible if we rely on the United States. At the moment, I doubt very much, despite the recent signs of more vigour, whether the Americans have recovered sufficiently from the thrashing that they took in Vietnam to be capable of defending themselves let along defending us. I fear that we are now so weak in conventional ground forces in Europe that we are almost back to the nuclear tripwire theory of defence. I believe that we could not hold back a serious Warsaw Pact thrust for any time worthy of mention and that we would be committed almost immediately to surrender or going nuclear. This was the perilous position into which the trip-wire philosophy was landing us a few years ago.
We are now drifting back into it—not because we think it a good policy but because it is the only one we can afford. We are trying to pretend that that is not the policy, but we well know that there is no other possibility but that

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of going nuclear at an early stage unless we can hold back with conventional weapons a major armoured thrust.
We in Europe have to defend ourselves. We in Britain must be willing to pay for our defences. Let us not talk about the other things we want to do. Of course hospitals schools and pensions are important, but unless we defend ourselves what good are those facilities?
I hope that the Minister in reply will not make the usual excuses—namely, that we spend a larger percentage of our GNP on defence than do the Germans. The Germans spend more per head on defence than we do. I leave the House with this thought: is it Government policy that the defence of a British head is not worth as much a the defence of a German head? I hope not. I hope that just for once one of the moderates of the Labour Party will have the courage to stand at the Dispatch Box and say, "Thus far and no farther. I have already said that this is the minimum scale of expenditure for a credible defence of Great Britain. If anybody cuts it further I shall go." That is what any self-respecting Minister should say in these circumstances.
8.13 p.m.
Mr. Geoffrey Pattie: I shall have some difficulty in following the authoritative tour de force of my hon. Friend the Member for Chingford (Mr. Tebbit). I should like at the outset of my remarks to apologise to the House for my late arrival, but I have been in the Standing Committee on the Finance Bill upstairs. I hope that the House will accept that explanation.
In the present financial stringency we are right to ask whether we are getting value for money from our defence forces. It is true to say, looking at the matter historically, that ours has always been a policy of quality. Never for us has been the motto: "Never mind the quality, feel the width". We have always gone for small forces, highly-trained, well-equipped and supplied.
There are three questions I wish to ask the Minister tonight. First, are we deploying to the best advantage in the light of what a potential enemy is doing? The Minister will recall that in the debate on the Defence White Paper there was
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a great deal of talk about what our allies were or were not doing, but there was very little talk of what the enemy was doing.
Secondly, are we identifying the technology gaps and developing sensible research and development programmes? Thirdly, are we doing all we can to develop sales of our equipment to export markets?
Going back to the first question, namely, whether we are deploying our forces to the best advantage, the White Paper contains many non sequiturs. Time and again the nature of the Soviet threat is set out in some detail, followed by an announcement of further cuts. The situation is similar to a parish council fire brigade committee of an ancient village saying, "We recognise that we have many ancient dwellings in this village which are tremendous fire hazards but we are intent on cutting back on the number of firemen and the number of fire appliances".
On page 27 of the White Paper we ser the following passage
"The Warsaw Pact's building rate for nuclear-powered submarines is now twice that of NATO. The numbers of Warsaw Pact and NATO surface ships are broadly similar, but Allied surface vessels include a very much higher proportion of older ships and carry substantially fewer offensive or defensive missile systems. Furthermore, such numerical comparisons disguise the full extent of the imbalance between the Soviet submarine fleet, which is now increasingly nuclear-powered, and the capability of NATO's anti-submarine forces. The major Soviet threat at sea therefore comes more from the very large submarine force, and from the Soviet Union's substantial building programme which is improving the quality and average age of the Soviet fleet compared with those of the Alliance."
That statement is followed a few pages later by a reference to a cut of 25 per cent. in our Nimrod forces. First, one identifies the problem and then one decides to do entirely the opposite. It looks as though there are two sets of diametrically-opposed authors. One wonders what sense there is in that when if we reduce our Nimrod capability we also reduce our ability for surveillance, thus taking away our eyes and our ability to know what is going on. If we cannot know what is going on, we are finished.
Mr. Tebbit: The solution to my hon. Friend's query is simple. There were

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two sets of authors. Those who identified the threat were military men, and those who proposed the answers to the threat were politicians. That is why there is a split.
Mr. Pattie: I accept my hon. Friend's diagnosis. I am sure that he is right. It was said earlier at Question Time, in regard to the defence of North Sea oil installations and oil rigs, that the present was not the time to reduce Nimrod capability. The Government have said in their White Paper that if we withdraw from the Mediterranean Nimrod reduction will follow, without stopping to consider questions of redeployment. If we have to come out of the Mediterranean, the Nimrods could be redeployed and used from a United Kingdom base.
I do not quarrel with the necessity for reappraising our rôle. In the modern world it is important that we continually look at what we are doing and why we are doing it. It is right that we should never pretend that we can play various parts around the world. It is the understatement of the year to say that we are not what we were either in an economic or military sense. That is quite fair. It is also an understatement to indicate that the review has produced some profoundly unsettling effects for our NATO partners, particularly on the southern flank.
We know how expenditure cuts are made. The Prime Minister sits round the Cabinet table and says "Come on, chaps, it is 10 per cent. off all round." The question that arises is whether money is spent on a mile of motorway or on a comprehensive school. It would be an unusual Prime Minister who said "If we do not have adequate defences, all questions of motorway programmes or comprehensive schools will become academic." This point came up again at Question Time. One has to consider whether the ability to defend oneself is not the most fundamental call on national resources. That no doubt will continue to be the great divide between Conservative and the Government.
The Soviet threat, as I see it, is likely to be from low-level fighter-bombers such as Fencer and the harmoniously named Mig 23 Flogger. The Fencer can manage high G manœuvring and manufacturers of our surface-to-air missiles are at
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present working with targets which can produce 1-G weaves. That gives some idea of what we must expect for the future.
Against this threat we can deploy Strike Command, with 84 air defence aircraft. Having said that we must go for high quality forces, I do not want to fall into the trap of playing the numbers game. However, I am also aware that the Middle Eastern nations tends to be almost over-armed. In the Yom Kippur war the Syrian Air Force alone had 227 Mig fighters destroyed. Our present limit is to have 84 air defence aircraft to defend our nation.
My hon. Friend the Member for Chingford has spoken with great penetration about the MRCA. If his doubts prove to be accurate, we shall be in a very difficult and dangerous situation indeed, because our defences from 1983 onwards—what exactly we do until 1983 will depend entirely on the thin blue line that I have mentioned—will rely entirely on the 165 air defence variants of the MRCA, which starts to enter squadron service. I hope that the Minister will take close note, as I am sure he will, of my hon. Friends comments on the MRCA and ask for a report and assessment based on those observations.
Mr. Dalyell: It is very easy for hon. Members to make these kinds of statements and assertions. Those of us who have taken the trouble to go to Munich and talk to Mr. Madelung and other engineers know that they claim that the MRCA can fight at as high an altitude as can any other foreseeable aircraft.
Mr. Pattie: I hope that the hon. Gentleman was not suggesting that Conservative Members had not taken the trouble to go to Munich. As he knows, I have, and I have spoken to Mr. Madelung, as have my hon. Friends. I felt that the observations of my hon. Friend the Member for Chingford were at least worthy of consideration in this matter of the power-weight ratio.
I welcome the improvement that is proposed in ground communication systems, the increased development work that is proposed in electronic counter-measures and—I hate to have to use the jargon of the day—in electronic counter countermeasures. This is the world we live in.

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However, it is a very important world if we are to try to slow down any Soviet offensive that may occur.
I am pleased to see the potential progress in certain types of weapon directions, particularly the XJ521, which has the Marconi Space and Defence System's homing head. I find it difficult to quarrel too much with the restrictions proposed in the RAF transport fleet, although I am aware that some of my hon. Friends may take issue with me on this point.
However, I am seriously concerned about the reduction in the number of Nimrods. At present a number of Nimrods are being converted into a Mark II anti-submarine force, but we also have to consider the urgent need to develop our airborne early warning capability.
At present the United States is exercising strong pressure on us to buy its AWACS, which, off the shelf, will cost approximately £40 million a system. This points to the very classic situation that we often seem to find ourselves in in the procurement of defence equipment. All too often we seem to reach a situation in which, suddenly, the Chiefs of Staff appreciate a need. They look at our development—which for various reasons has possibly been held back, perhaps due to a change of Government—and find that we do not have and shall not have what is required, but surprise, surprise, the Americans do. Then the lobbying starts to build up and it is suggested that we should buy what is there, although the cost to the balance of payments will be severe and there will be disadvantageous effects on our industrial capacity. Certainly this would be very serious if we bought the American AWACS or the Hawker Siddeley factories in the North West of England.
I turn to my second point—are we developing sensible research and development programmes? There is no need for me or any hon. Members to dwell on the desirability of standardisation. It has been suggested that there would be a one-third improvement in efficiency from standardisation alone. The White Paper says that the expenditure will be £470 million in 1978–79 and £400 million in 1983–84. Even within the guidelines that the Secretary of State has had set for him, it is bizarre to say the least to plan to reduce research and development
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expenditure when we are looking forward to 1983–84 and talking in terms of cash, quite apart from what that will actually buy by that date. It is amazing, because it is on our ability to direct future weapon systems and electronic countermeasures that our survival will depend. If we opt out of that we shall have nothing whatever. We shall have to take the Danish solution of the gentleman who suggested that we should play the gramophone record which says "I surrender, I surrender, I surrender". This is totally unrealistic.
We also run the great risk that as a country which is largely dependent on high technology projects throughout its industry, we shall gradually opt out or be opted out by a Government decision or lassitude until, in the end, we shall be unable to get back into any of these projects. The lesson of modern technology is that once one opts out, one is out. We cannot say "It is all right, I will catch the roundabout next time it comes round", because it does not come round.
My third point concerns the question whether we are selling our equipment effectively abroad. I should like to put a rhetorical question. Why is it necessary, and why should we bother, about selling our equipment abroad? There are four reasons why it is important for us to do so. First, if we can effect sizeable sales of British defence equipment abroad, it will have the effect of reducing the unit costs of those supplies to our own Services. Secondly, it is of enormous benefit to the United Kingdom's balance of payments. I do not need to stress the desirability of that. Thirdly, it maintains our industrial capability and employment, and I believe that even many Labour members have started to twigg that that is rather desirable. Fourthly, it maintains our tactical self-reliance if we can rely largely on a substantial amount of our own equipment. I do not need to embroider that point, it is simply that if we rely on certain vital components and we get into a difficult war or almost-war situation and find that the person from whose country the components might be coming takes a slighly jaundiced view of our policies, it is possible that the infrared homing device or whatever it may be, will not arise. It is important that we retain as much as we feasibly can in terms of tactical self-reliance.

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The paragraph in the White Paper which deals with defence sales is, significantly, tucked away on page 81, after "Meteorology". Whether this is something to do with tactical changes in the weather I do not know, but the paragraph on sales runs to about five lines. It states that
"Exports of defence equipment continue to make a valuable contribution to national exports. Overseas sales of defence equipment cover a wide range of items produced by the Royal Ordnance Factories. The Defence Sales organisation has continued to provide support, assistance and advice to industry and exports are expected to reach the value of £560 million in 1975–76".
That is marvellous. We have no worries at all. The only snag about defence sales is that we do not necessarily hear about the contracts which are made and we usually find that they leak out eventually. But we are certainly not encouraged to find out about the contracts not made.
It is the contracts that get away and have got away with which I am concerned. I want here to indict not so much the defence sales organisation itself, trapped as it is between and within the Ministry of Defence, the Department of Industry, the Treasury and the Foreign and Commonwealth Office. The Paris Air Show seemed to be delightfully schizophrenic on our part. Within the British pavilion the area set aside for the defence sales organisation was labelled "British Defence Sales Organisation, Department of Industry", and "British Defence Sales Organisation, Ministry of Defence". It rather depended on which door one entered as to what kind of reception one received.
What we are really entitled to heat about is Government policy, or lack of Government policy. What the Government must do is to manifest their support and assistance—about which they write so grandly on the page following that dealing with meteorology—because the experience of British industry is that it does not get this support, assistance and advice.
Where were the Government when the Roland contract went to France and Germany, when our Rapier missile system was apparently being preferred by Service chiefs in the United States? This was a 1,000 million dollar contract. We
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are talking of huge sums of money with fantastic benefits to the balance of payments and colossal employment possibilities for British industry. Where were the Government then?
I take yet another flabby situation. Where were the Government when Nimrod failed to get the Australian contract, which went to Orion, even though the Australians had indicated tremendous interest in Nimrod beforehand? Where were the Government when the four nations started looking for a replacement for the F104? It is not good enough for the Secretary of State to say, as he did at Question Time today, that he had placed this twice before Eurogroup. One can imagine it: "There you are, chaps. If you have nothing else, fall back on Jaguar. We can fit you up with one or two of these."
Nations in the modern world sell hard their own projects. They are totally self-interested. They do not regard British disinterest as a sign of strength; they regard it as a sign of weakness. They take precisely the opposite inference to that which we seem to be wishing to put about.
We have debated previously the question of Jaguar sales to India. The Indians say they want Jaguar. The British Government say that the Indians do not have any money. But the British Government then say "You can have a few frigates, or 10 748s". It appears that if the Indians want Jaguars they are insolvent. It is difficult to know how one can be insolvent in relation to one transaction but not to another. Will the Minister confirm the suggestion that the Indians have now asked to buy six Jaguars for cash? That would at least put the British Government to the test. I hope that the Indians have done so. We look forward to hearing the answer.
The Government pay lip service to exports. They say, as the Secretary of State has said, "We are very keen that British companies get the contracts, and we shall put forward various British projects at various meetings at which we attend, but we do not actually push hard. We do not sell." We must stop walking around the world holding open the door for the Americans and the French. It has been suggested by my hon. Friend the Member for Chingford

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that we must collaborate with the French. I, for one, would be happy to collaborate with them were they happy to collaborate with us. The Jaguar experience suggests the contrary.
Mr. Tebbit: The French have been extraordinarily irritating partners for us, but we should remember that we have been extraordinarily irritating partners to the French. Ever since the appalling Skybolt and F111 affair, there must be a doubt in the minds of Frenchmen whether we have decided to cut the umbilical cord that stretches to America and to take part in Europe, or to assume a rôle which would put us 30 degrees west.
Mr. Pattie: That is a fair point. I hope that certainly the latitudinal view on this point has been resolved by recent events.
Mr. Kenneth Lewis rose——
Mr. Deputy Speaker: May I indicate to the House that at present we have 25 minutes left before the winding-up speeches? We have had speeches lasting for 29 minutes and 28 minutes. To have interventions at this stage when there are four additional Members anxious to take part is rather unfair.
Mr. Lewis: May I exchange an intervention for a speech, Mr. Deputy Speaker? If Europe does not get together militarily—the French, the Germans, the British—and get some kind of co-ordination into its equipment, however sophisticated it may be, in the communications field, for example, where there are gaps, we shall be in no condition to fight another war because the enemy will go through the gaps.
Mr. Pattie: I did not intend to incur your displeasure, Mr. Deputy Speaker.
Mr. Deputy Speaker: Order. It does not affect the Chair. I shall leave the Chair when I am due to leave it. It is a question of trying to co-operate with all those who wish to take part in the debate.
Mr. Pattie: I take your point Mr. Deputy Speaker. If the Government, as they claim, are to seek value for money for this country in the very large sums spent on defence, they must address them-
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selves much more forcibly to the questions I have posed.
8.36 p.m.
Mr. Michael McNair-Wilson: The theme of the speeches in this debate has been that the price of freedom is eternal vigilance, and the question which the Under-Secretary has to answer is what constitutes eternal vigilance. In view of the continual criticism the Under-Secretary has heard of his policy, I can bring him one crumb of comfort. I was speaking to an air chief marshal yesterday and he said, "They may have cut the Royal Air Force to the bone, but at least they have left the front-line force strong enough to do the task for which it was planned." If that is the case, that is the excuse for the defence statement about the Royal Air Force and I am prepared to give the Under-Secretary the benefit of that doubt.
Before I go on to the body of my speech, I want to touch on a constituency point about which I wrote to the Minister last week and which I think may be more relevant in other terms than I thought when I wrote. It concerns the use of RAF Welford by the United States Air Force as an ammunition store. I have been in touch with Major-General Evan Rosencrans, the Commander of the United States Third Air Force, about the convoys of lorries—500 lorries in all—which have gone from Barry Docks to RAF Welford over the last fortnight carrying ammunition. They have been passing through part of my constituency, particularly the village of Great Shepherd, at all hours of the day and night. They have been in convoys of five to nine lorries and have caused enormous inconvenience and upset. They have awakened children and generally created the most appalling concern for the villagers. Now the residents want to know when the convoys wilt stop and what will happen when the United States Air Force wants to draw the ammunition out of the air base as, presumably, it will at some stage.
There was a protest meeting in the village last Saturday and, arising from that, I should like to ask the Minister whether, when he consents to the United States Air Force using an RAF station, for whatever purpose, he takes account of the inconvenience that may be caused

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to local inhabitants, such as these villagers, by processions of heavy lorries.
If the United States Air Force is mainly centred in East Anglia, why should two RAF stations in Berkshire—RAF Greenham and RAF Welford—be used for ammunition stores when they seem to be so far away from where the ammunition will presumably be used, if it is used at all?
Will he consider the rôle of RAF stations which are used by the United States Air Force, and if they are not now serving a useful purpose for the United States Air Force, would it not be better that they were closed down? The housing in those stations would be useful to local authorities, and my constituents would be grateful to be relieved of nuisance caused by the current use of these bases.
We know from the Defence Review that a number of RAF stations are to be closed. To deal with a point raised by one of my hon. Friends who is unable to speak in this debate, will the Under-Secretary say how soon the housing at these stations is to be returned to civilian use, and how soon local authorities will be told that they can designate it for their housing lists? The housing waiting list in Berkshire is formidable, and any chance of housing coming forward of the kind I have mentioned would be gratefully welcomed by the people on that list.
I want to turn to the question of the cuts in what I will call Transport Command. It is quite true, as the Minister has said, that there is now no need to fly our troops all over the world, but it is also true—and perhaps I should declare an interest and say that I am a council member of the Air League—that we have a NATO duty to be able to supply the northern and southern flanks of the treaty area and that we can do that only with air power. If, therefore, we reduce our Transport Command capability too far, we shall not be able to fulfil that rôle.
I am sure that the Minister is aware of a tiny item which appeared in The Times recently which said that NATO military intelligence had noted an enormous increase in the Soviet Union's use of air power for moving troops. Could I put it to him that it is curious that,
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while the Soviet Union are building up their transport side, we should be reducing ours, to quote the air chief marshal, "to the bone". Perhaps he can assure the House tonight that although we have reduced the capability of Air Transport Command, it is still a very flexible and efficient service and can fill the rôle for which it is required. Sometimes we imagine that our forces are there to meet some new world war, but I suggest to the Minister that there are many other kinds of conflict that break out requiring Transport Command. The security operations in Northern Ireland clearly pinpoint what I am talking about.
I want to come to the question of those Service men who are to be phased out of the Service because of the reductions which have been announced. I welcome what the Minister said earlier this afternoon when he spoke of how well they were to be looked after, but may I press him a shade further? A number of the people who are to be declared redundant will be middle-aged, and they will find considerable difficulty in getting jobs in Civvy Street. Can he say whether his Department has any proposals for retraining these people and, in particular, for finding them employment throughout the United Kingdom? It is one thing to say that these people are to be adequately compensated, but compensation will not be enough for people who imagined that they would have careers in the RAF but suddenly find that their lives in those terms have come to an end.
Could the Minister say rather more than he has said? May I suggest to him that if they were trade unionists in some form of civil industry, they would almost certainly not be declared redundant but would be allowed to leave the Service under, to use a rather euphemistic phrase, "natural wastage". I hope that we will not be less sympathetic to Service men, be they officers or other ranks, than we would if they were people working in industry.
Mrs. Winifred Ewing: Perhaps the hon. Member would care to read a speech which I made on the question of the housing of members of the Forces who were reaching the end of their careers. The redundancy situation makes it all the more pressing. I received a great deal of support across the House from all parties—but I have

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not so far heard a word from the Minister whether he has any intention of implementing the suggestion—for a suggestion that a man, on marriage or entering the Service, whichever is the later, should be able to put down his name as an ordinary citizen on the council housing list of his choice.
Mr. McNair-Wilson: I am grateful for the hon. Lady's intervention. I have not read her speech but I will certainly do so.
I know that the question of housing is very pressing, with the enormous rise in house prices. When I went round the Cyprus bases the subject was raised continually. I hope that the Minister will say something about it.
On the question of Transport Command, personally I welcome the standardisation that has come over Transport Command because I have felt that for far too long it is, or has been, a ragbag of aircraft, and I am very glad that the choice is to be the Hercules. I am by no means unhappy that the VCIO fleet is to be reduced because when I travelled in a VC10 of Transport Command I felt that we were asking RAF personnel to undertake tasks which are better performed by airlines. If the Minister can assure me that adequate charter aircraft are available to do the task of trooping, that is all right by me. I remember pressing a colleague in the House to do just what the Minister has done, so he gets a little welcome from me on that score.
Before I leave the question of transport aircraft, I come to the point that I wanted to make most forcibly. It is true that we shall now use the American Hercules as our main transport aircraft. We all know that it is a superb aircraft, perhaps one of the great aircraft in the world today. It is flexible, and is to be found throughout the world, among European air forces and other air forces. But one day it will become obsolete, and we shall be having a debate about the aircraft to succeed it.
I wonder whether there is an operational requirement for that replacement drawn up by the RAF for consideration by our industry, or shall we find, as we so often find in Western Europe, that we did not think about it quite early enough but that the United States
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did, and that once again there will be a United States aircraft ready to purchase, that once again Europe will be buying American?
I say that with no desire to knock the American aircraft industry, which is a great industry, but because we always seem to miss the bus. There is now a United States operational requirement for the aeroplane that I am talking about, and there is a competition in their industry for it. I understand that the aeroplane is described as the short takeoff and landing advanced medium-transport aeroplane. Short take-off and landing are things of which our industry has some experience, and an advanced transport aircraft is something that we shall need.
Why cannot we have an operational requirement, if not for Europe, for the Royal Air Force? If we had it, we should have a chance of producing an aircraft for which NATO will have a need.
That takes me to the question of standardisation, a matter that has been raised so often. When will NATO think in terms of being one entity, without national differences? When will it create a single operational requirement and turn its aircraft industry towards that requirement? Shall we go on endlessly with national wishes, and therefore inevitably a failure to produce the necessary hardware?
We have had the discussion about the YF 16 light fighter aircraft. I am told—and I have no reason to suppose that my information is wrong—that the Americans identified a need in Western defence for this type of aircraft and chose to build it, and that when they offered it to Europe certain European countries immediately realised that it was what they were looking for. It is no good our pretending that the MRCA could have fulfilled the rôle. It was too expensive, and too heavy, and not right. The Jaguar could not have fulfilled the rôle either. But the YF 16 was right, and so the Belgians and the Dutch ordered it.
We should not wring our hands and say that the Americans have shown that hard selling wins the day. We should be drawing a lesson from what has happened, which is that Europe should define its own defence needs and use its own aircraft industry to satisfy them. This is

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not a new story. Of course we can say "The Anglo-French Jaguar is a collaborative project. See how successful it has been"; and that the MRCA is a collaborative project which looks like being successful, although I think that the Americans describe it as a glacial project, because it has already taken 10 years and we have not yet got the aeroplane flying efficiently.
But I am talking about a European demand for a European aircraft which will go into service in all countries of NATO. If we draw up our operational requirements ahead of the event, we need not necessarily be beaten to the punch by the Americans on every occasion. Perhaps the advanced STOL transport aircraft which the Americans believe they will need is an opportunity for us to get the Eurogroup to draw up just such a NATO operational requirement. I suggest that it is, because it could have a civil use as well.
But whether it is that aeroplane or another, I ask the Minister to say anything he can about the initiatives he is taking to make NATO create a procurement executive and to make Europe, in terms of the EEC, NATO or anything else, think as one entity for its defence requirements.
Before I close perhaps I could stress the point that we should remember that America is also a member of NATO, and I do not think that any of us have persuaded ourselves that Western Europe can be defended without America. However, it seems incredible, when we have a great and advanced aircraft industry, that in that single capacity we are unable to meet our own needs. I suggest that the reason we have failed to meet our needs is not that the needs are difficult to satisfy but merely that we are unable—although we claim to be allies—to think and act as one.
Mr. Deputy Speaker: I think that there will be time for the House to hear two more speeches by five minutes past nine o'clock.
8.51 p.m.
Mr. William Craig: I am grateful for the opportunity to make a speech at this late stage and I shall endeavour to be as brief as possible.
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Having had a small involvement with the RAF during the last war, I am tempted to roam over the subject generally. However, in fairness to the House I shall confine myself to something in which I am more expert, namely, a constituency matter. The Minister will know that I am talking about RAF Sydenham.
Before I go into the problems affecting RAF Sydenham I should like to point out that yesterday I had the privilege of visiting that station, and I am grateful to the Minister for the opportunity that he provided. What I have to say tonight is not born out of that visit, although the experience has tempered the remarks that I have to make. I was very impressed at the capacity of the RAF officers in charge of that station to discharge their industrial function. Due to the Government's decision to cut back on RAF Sydenham, some very unpalatable decisions have to be taken. The station officer and his colleagues have shown marvellous tact and consideration in doing a very painful job.
The Minister will know that RAF Sydenham, in all its different characteristics as a Service installation, has had a very uncertain record. It is a marvellous installation, with a marvellous work force that has performed wonders in the tasks that have been assigned to it. However, it always seems to be coming under the axe. This particular axe falls in a very unhappy way, because, as the Minister knows, one of his predecessors, envisaging a cut back, gave an undertaking that the Buccaneer work would remain with RAF Sydenham. Much to the dismay of the whole station, the Buccaneer work has been taken away. Indeed, that was the only front-line aircraft it had to handle. The men find it very difficult to understand this decision. They have a very proud record in the handling of Buccaneers. No one in the RAF or anywhere else will dispute the expertise that exists at Sydenham.
The loss of this aircraft has not only heightened the uncertainty about the future of the situation. It is interpreted by the men as an act of bad faith. I am not joining in any accusation of bad faith, but I can understand how the feeling exists. Two years ago they were told, when the cut back came, that Buccaneer would stay, but now it has gone and there

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has not been an adequate explanation. The trade unions have been pressing for a meeting with the Minister and I join them in asking that that meeting should take place quickly.
As a result of this decision, the character of RAF Sydenham is changing substantially. Until now the work has been divided between what may be called aircraft production and the repair of aircraft components on a fifty-fifty basis. As a result of this cut back, aircraft production will be about 25 per cent.
I am not saying—indeed, I do not think I should have any justification—that this change is necessarily bad for the employment prospects of the men at RAF Sydenham. But I should like an assurance that this decision does not mark a phased run-down of RAF Sydenham, that there is a rôle for that station, and that the men can look forward with reasonable certainty to giving the service that they have given so valiantly in the past in both war and peace.
Many different problems arise from this redundancy. I ask the Minister to speak to his hon. Friend the Minister of State, Civil Service Department, about these problems. There is what is known as the mobile branch of the Civil Service—men over the age of 50 with families who now find that the only prospect is perhaps a transfer outside Northern Ireland. It is not easy for them to make that transfer. I ask that consideration be given to a proposal that they be declared redundant on Northern Ireland terms.
I also ask the Minister for an assurance that the men at RAF Sydenham will have a positive programme to which they can look forward. I do not know whether the hon. Gentleman can elaborate on the extent and scale of the increase in the repair of aircraft components, but anything that he can say to increase the confidence of the men at RAF Sydenham will be greatly appreciated.
I do not want to weary the House by singing the praises of RAF Sydenham, but it is not just another RAF station with a civilian industrial capacity. The men who work there have served in Her Majesty's Services through the years. Many of the men to whom I spoke yesterday had been at RAF Sydenham for 20 years and had served in the RAF before that. There is a family tradition. I ask
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the Minister, in recognition of RAF Sydenham's great capacity, to give some reasonable assurance for the future.
I should like to conclude in a more general way. The problems of RAF Sydenham can be translated into every aspect of the Royal Air Force. We all appreciate that, because of our present economic difficulties, cuts in public expenditure must take place. I plead with the Minister to ensure that those cuts are made on the basis of preserving something on which we can build in future when our economy enables us to strengthen the RAF to play its important part in the defence not only of the United Kingdom, but of the whole free world.
I join the hon. Member for Newbury (Mr. McNair-Wilson) in the plea that we should try to think of the RAF in a European context. We are in Europe for better or for worse. We have accustomed ourselves to the idea of harmonising social services, and so on, in the interests of competitive enterprise. It seems strange that defence expenditure has not been harmonised in the same way. I should like to think that, while defence might not be thought of in EEC terms, at least we can think more of harmonisation. It will be in the interests of all and will enable the RAF to live up to its high record.
8.59 p.m.
Mr. Paul Hawkins: I thank you, Mr. Deputy Speaker, for allowing me this short time to speak in the debate. Therefore, I will cut out a lot of what I intended to say.
I start with an apology to my personal if not my political friend, the Minister, for not being present when he made his speech. But I believe that Select Committees have precedence.
The Minister is very good and painstaking. Indeed, he answers extremely rapidly the many questions which I and others fire at him.
I am pleased, as was the hon. Member for Tynemouth (Mr. Trotter), to agree with much that was said by Labour Members. I agree with many of the points that he made in his speech. In particular, I hope that we may have interesting and exciting television programmes about the Army, the Navy and the Air Force. Such programmes could be really

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worth while. I envisage short programmes—not necessarily run entirely by the Forces but sponsored by them and run properly and commercially—as being of immense value to the morale of the Forces, creating interest on the part of the general public in our forces, and assisting recruitment generally.
I agree very much with what my hon. Friend the Member for Tynemouth said in two respects. The first concerns the cutting down of the RAF Regiment. I am very concerned about this. I have a very large Royal Air Force station in my constituency, close to my home. There are also several Royal Air Force stations very close to my constituency, and another very large one also in my constituency. The great vulnerability of immensely valuable aeroplanes standing just inside the perimeter requires the presence of the RAF Regiment, not only abroad but at home as well.
I should like once again to re-emphasise the importance of housing. I raised with the Minister recently the question of housing at RAF Bruggen in Germany. I visited Bruggen while in Germany a short time ago with an all-party delegation and was very concerned to find, after being told that three to six months was the longest time a man had to wait, that at RAF Bruggen a man could be 12 months without married quarters for his wife and family.
The matter of housing for men after they leave the Forces has been raised on several occasions. It is one which rankles more in Service men's hearts than anything else. The other day an ex-aircraftsman told me that he had served in the RAF for 23 years. He was born in the neighbouring town and, having just left the RAF, has a job in that town. His child, a spastic, goes to a special school in that town. She has to leave home at 7.15 a.m. and does not get back until 5.15 p.m., yet the local authority has told him that until the RAF gives him an eviction notice it cannot possibly house him. He said to me, "I do not want to end my service with the RAF after 23 years with an eviction notice." That is the sort of case we ought to support, and I hope that the Minister will put some real power behind his message to the local authorities.
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I have previously raised the subject of low flying, and I hope that before long we shall hear the result of the inquiry concerning the accident with the crop sprayer in my constituency.
I was an Army man for 12 years but started on an RAF station, and I have two magnificent stations nearby at Marham and Swanton Morley. They contribute a great deal to the whole life of the neighbourhood, providing employment and contributing towards the community spirit. They enter into the affairs of the community over a radius of 15 or 20 miles.
The Labour Left, the Tribune group, are as despicable to me as they are, I feel sure, to many Labour Members. I will not say much more, but they contribute to any low morale in our Forces which may exist now and in the future. They are always criticising the very best in our Armed Forces and in the police. Right hon. and hon. Members on both sides of the House who believe in the defence of our people must speak up for the Forces and blow their trumpets occasionally. We have first-class officers and men. The only worry is that we have far too few aircraft, tanks and ships. Our people deserve a Government who make defence our No. 1 priority. I shall support the Opposition in the Division Lobby tonight.
9.5 p.m.
Mr. Victor Goodhew: Our debates on the Air Estimates are always fascinating occasions. Usually they encourage a larger attendance in the Chamber. But this House at the moment is damaged by a large number of Standing Committees sitting upstairs which result in attention being taken away from the Chamber, where some of the most important issues are being debated. The Opposition sometimes wonder just where the Government are going, seeing that so many Standing Committees are engaged on work which, in the end, will probably prove to have been wasted. At any rate, we have seen more Opposition Members during the evening. Some have even had to come down from Standing Committees to make their speeches and then return.
This has always been a wide-ranging debate. We use the debate on the Air Estimates as an occasion for discussing all manner of matters connected with the

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Service—the equipment used, the manpower, the administration, pay, closures of airfields, housing, and so on. All have been mentioned by many of my hon. Friends today.
We have had several impressive speeches, especially from my hon. Friend the Member for Chingford (Mr. Tebbit), who gave us a very interesting historical discourse, and from my hon. Friend the Member for Chichester (Mr. Nelson), whom we welcome to our Air Estimates debates and look forward to hearing again.
Exceptionally, we have also had many more speakers voicing anxiety about the capacity of the Royal Air Force to meet the threat that it may have to face. As a result, we have tended to spend less time on the nuts and bolts than we have in the past in debates of this kind.
Towards the end of his speech, the Under-Secretary of State for Defence for the Royal Air Force asked why the Opposition had singled out the debate on the Royal Air Force for a Division. I shall give him the answer. It is that we are not singling out the RAF for a Division; we are dividing the House on the Navy Estimates as well, because we regard the Government's maritime strategy as completely wrong. Even if we accept—and we do not—their central defence decision, which is that within NATO we concentrate our efforts on the United Kingdom, the Eastern Atlantic and the central region, we say that the Government's maritime strategy is all wrong.
Let me put one other matter straight, so that there are no more questions about it. The Opposition regard defence as being a special category of Government expenditure. We have always said so. It has been said again and again in this debate, as it has been in the past——
The Under-Secretary of State for Defence for the Army (Mr. Robert C. Brown): What about November 1973?
Mr. GoodhewDoes the hon. Gentleman wish to intervene?
Mr. Brown: The hon. Gentleman is prattling on about Conservative Governments always regarding defence as a special issue in public expenditure. I was reminding him of the measures of Lord Barber in November 1973, when he slashed £260 million from it.
Mr. Goodhew: I do not burke that issue, but it was after three years expansion of the forces and expanding expenditure. During that period, members of the forces—[Interruption.] It is no good the hon. Member for Brigg and Scunthorpe (Mr. Ellis) laughing so loudly. They were three years which were a great encouragement to recruitment. I hope that we shall not have any more arguments about it, because we said so in the past—and this is not prattling on—that every other item of Government expenditure pales into insignificance when set alongside defence. The Under-Secretary said that defence in a modern society is a combination of arms and—I believe he said—the quality of society. Those are lovely, airy-fairy words. What sort of quality of society is there if our defences fail and we are overrun by an enemy? What sort of quality of society does the hon. Gentleman think there would be if the Russians attacked this country and we were not in a position to defend ourselves? It is nonsense to talk about the quality of society as being a part of defence. If there is any aspect of the quality of society which is necessary to our defence, there is, on the other hand, a good deal that is wrong with the quality of society today because of the extremists in it who act against the stability of our country.
The interesting thing about the Minister's speech was that he had clearly written it before he had come into the Chamber and before he had heard my hon. Friend for Woking (Mr. Onslow). We cannot blame him altogether for that, because he has to write some of it in advance. But the Under-Secretary might have attempted to deal with some of the subjects to which my hon. Friend referred. Instead, he went on with his brief and entirely ignored the case put by my hon. Friend.
The Under-Secretary did not deal with the question why NATO took the opposite view to the Government on the state of our defences. He did not explain why it was that the Government could not persuade their allies in NATO that such a move was necessary and good. I shall read a piece out of the communiqué issued on 21st March. Paragraph 3 says that
"The Alliance has nevertheless expressed its disquiet at the scale of the reductions proposed and their effect on NATO's conventional

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defences vis-à-vis the increasing capability of the Warsaw Pact. The changes of special concern are: the reduction of reinforcement capability in the Northern and Southern Regions; the removal of naval and air forces from the Mediterranean area; and the decline in maritime capabilities in the Eastern Atlantic and Channel areas."
In the face of that I do not know how the Government can put forward a Defence White Paper which is outdated by a further cut of over £100 million and say that we are properly armed and in a correct posture to defend the country. The Minister said that he hoped that the previous debate—I assume he meant the main defence debate on the White Paper—had cleared away differences on general policy. I hope that he knows now that it jolly well did not.
The consideration of the Air Estimates can be viewed only against the scenario outlined in the White Paper. Many people have mentioned it during the debate and it is clear that there were two authors—one who wrote the background information from the Services and another who wrote the political, so-called answers. The 25 per cent. cut in Nimrods followed a carefully set-out case in the White Paper—page after page of it—telling us about the growing Soviet strength and how the shift in the balance of power was working against us. Then we have a 25 per cent. cut in our maritime reconnaisance capacity.
The Minister paid tribute to the men and women who serve in the RAF. We would wish most warmly to join in that tribute. Each time that we have a Labour Government I wonder how we manage to find people to serve in the Forces when this sort of position arises. He said that the squadrons being brought back from Cyprus were available to NATO, as if that were a great plus. When those squadrons were in Cyprus they were available to NATO, if required even then. They could always have been used in an emergency.
When referring to redundancies the Minister hoped vaguely that there would be a natural wastage of over 14,000, so that there would be only 4,000 redundancies out of the total of 18,000. He hoped that there would be many voluntary redundancies, so that not all of them would be compulsory. But how volun-
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tary is "voluntary", when we see the Royal Air Force in its present position?
Mr. John: The hon. Gentleman seems to have understood nothing that has been said in the debate so far. I did not talk about a vague hope. I referred to volunteering which has already been signified to the Royal Air Force.
Mr. Goodhew: I know that. The Minister listed certain categories of compulsory and voluntary redundancies. He gave no figures. Perhaps he will give the figures so that we can judge.
The Minister said that the force was quantitatively strong and qualitatively improved. The Opposition think that it may be quantitatively strong but that it is less strong than it was before the Government reorganised it. It may have been qualitatively improved, but only on the basis of hoped-for aircraft orders, many of which were in the pipeline before the Government took over. Today we heard little from Government back benchers.
The multi-rôle combat aircraft was mentioned frequently. When we discuss the economy we are told that we are knocking the pound. Equally, if an hon. Member mentions an aircraft, and is anxious about delays, he is accused of looking for trouble. There have been delays with the MRCA. There has been trouble with high-pressure turbine fatigue in that aircraft. There are anxieties about its fuel consumption. There is a shortage of engines because of delays in delivery and because the engines are being passed back to the works for stripdowns and extra work. It is ridiculous of the Minister to try to fob off the House with such matters. It is better to be straightforward so that we know where we stand.
The Government say that they have ordered 385 of these aircraft, which are vital to the RAF, but the delivery of which will be reduced by one third. Has that been agreed by our allies and our partners in the project? Has the Minister made an estimate of the increased cost arising because of delays and inflation?
The Minister expressed himself as pleased with this project. However, the MRCA turned up after the Labour Government cancelled the TSR2 in 1965. The MRCA has still not arrived. We continue to wait for the replacement.

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We have talked of the replacement for the F104 in Belgium, the Netherlands, Norway and Denmark. I ask myself, if Germany and Italy were prepared to replace the F104 with the MRCA, why could not the Government persuade these four countries that the MRCA might be a suitable aircraft? What efforts have been made to sell? Did the Government try to sell Jaguars to those countries? We do not know. We do know that all Labour Governments are quick to refuse to sell arms to countries of whose policies they disapprove and are slow to get out into the field to sell aircraft and weapons to those to whom we should be selling.
When talking of the cost of weapons, I hope that the Minister will remember that 50 per cent. of the cost comes back to the Chancellor of the Exchequer in the form of taxation. I do not expect that we are told anything about that when figures are given.
It is extraordinary that we should be told that the replacement of Phantoms by Jaguars is an improvement. It is also somewhat misleading. Although the Jaguar is effective in the rôle for which it was designed, its self-defence capability and all-round performance cannot be compared with that of the Phantom. When one contemplates the capabilities of Russian aircraft—the MIG 25 Foxbat and the MIG 23 Flogger—the so-called improvement becomes even more unbelievable. We should like to know whether we are selling 24 Jaguar aircraft to Turkey.
What efforts are being made to sell more Nimrods'? Does the Minister feel that he has a good chance of getting the Nimrod accepted as an early warning aircraft not just for this country but for other NATO countries? What efforts have been made to sell it to Canada and Australia? I understand that Australia has already decided on a much less effective American aircraft. How that can happen if the Government are trying hard to sell, I simply do not know.
We are delighted that the Government are to order the Harrier for the Royal Navy. Did it ever occur to the Government, in the context of their rôle in NATO, to recommend the Harrier as a mix with the F16 for the four European countries which want to replace the F104?
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Recent experience in theatres of war shows that airfields are knocked out first. The aircraft that depend on runways are, therefore, likely to be inoperative for some time, whereas Harriers, if dispersed, are not so easy to knock out. These countries, in response to some efforts from the Government, might have been persuaded to think in terms of the Harrier as a mix with the F16. We know that the Soviets are developing the Yak 36 for maritime and land operation. That aircraft no doubt is a direct crib of the Harrier. If the Russians are cribbing it, we can be sure that they think the aircraft is as good as we think it is.
The background of the White Paper is remarkable. It contains a review of the growth of the Warsaw Pact forces spelt out in great detail, indeed in much greater detail than in any previous White Paper I have seen in my 15 years in the House of Commons. The message is clear, beyond shadow of doubt, that the threat is greater than ever before. There are warnings that détente, if such a thing exists, which I often wonder, is "not yet irreversible". That is good news—as if it ever could be. We all know that détente is merely a period during which the political intentions of a Government appear to be honourable and friendly, but those intentions can change overnight and if that Government have arms and weapons détente rapidly ceases.
We are told on Page 8 of the White Paper, in reference to the Warsaw Pact, that
"We cannot exclude the possibility that its members might try to use their massive military power, especially in conventional weapons, to bring political pressure to bear—perhaps selectively"—
if "selectively" means, "on the weakest", why should we make ourselves weaker at a time like this?—
"on Western countries in the hope of influencing their external and even their domestic policies."
If the Government believe that the weapons that the Russians have may be used to blackmail us and to change our domestic policy, how on earth can they cut the RAF in this way? Against that background it could hardly be expected that there would be massive defence cuts, but we would be wrong to take that view.

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Of course, the decisions that have been announced bear no relationship to the background that has been so carefully described. They are dictated, we know, by the desire of the Prime Minister to placate his Left wing. We notice that there have been very few members of the Labour Left wing here today. They have kept well out of it, although they know perfectly well what is going on. They are glad to be out of the way and to hope we do not notice that they are still around.
Mr. Roderick: If in one breath the hon. Gentleman says that the Prime Minister is placating his Left wing, why is he so happy to see the Left wing missing?
Mr. Goodhew: I am not happy to see the Left wing missing. I merely said that the Left wing was glad to be missing because its members thought that they would distract attention from their real intentions.
On 7th May the Under-Secretary of State made great play of the arguments of those who thought that the cuts were too great and those who thought that the cuts were too small. He spoke with pride of the middle course steered by the Government, but what does he mean by "middle"? The hon. Gentleman knows perfectly well that the majority of the Labour Left wing does not think in terms of a certain size for the Royal Air Force or a certain sized Army or Navy; it thinks in terms of none at all. We think in terms of sufficiently large forces to meet the threat with which we are faced. How can there be a middle course between those two ideas which provides an air force worth talking about? The question has only to be posed to expose the whole policy as nonsense, and dangerous nonsense at that.
So we are faced with these massive cuts in the Royal Air Force. They do not make sense, even on the Government's own proposition that we should concentrate entirely on NATO. In that context we see the withdrawal from the Mediterranean. Do our NATO partners welcome that? They do not do so in the communiqué. We would like the Under-Secretary of State to say whether he still thinks that withdrawal is welcome. We see the withdrawal from Cyprus and the
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withdrawal of Nimrods from Malta. All this is taking place when the Soviet Union has vastly expanded its navy so rapidly. We are told in page 8 of the Estimates that
"The Soviet Union has vastly expanded its navy and can rapidly deploy substantial naval forces across the maritime lines of communication between Europe and North America."
That is the area we are supposed to be looking after, yet we are blandly informed that the Nimrod force is to be cut by a quarter. What sense can this possibly make?
I have already mentioned manpower redundancies. We used to talk with pride of our professional Armed Forces. We used to claim that professional people could enter the Armed Forces with pride and remain so engaged for the whole of their working lives. We emphasised that again and again. We have been able to pride ourselves on the professional ability within the Armed Forces. Now, suddenly, these officers and men, who joined the Armed Forces believing that they had a life-long profession before them. are thrown out.
We are told that there will be 4,000 redundancies. If it were a factory in trouble, the Government would bail it out rather than put 4,000 people out of work, but because those 4,000 people are spread over the country, they are regarded as expendable. That is the simple answer. But for the individuals involved, redundancy is a traumatic experience. The 4,000 personnel involved are unfortunate enough to be a pawn in the Government's hands—a Government who at this time are ruled by the Left wing in this as in other spheres.
Let me say this to the Minister—[An HON. MEMBER: "Do get a move on!"] Government Members should not get too agitated. I have not been speaking for half an hour and I am proposing to finish very shortly. It is tiresome to speak against a background of sedentary comments.
I suggest that Labour Members who talk so glibly about redundancy and cutting forces should talk to some of these people and listen to their views about being thrown out of the Services. When we consider the situation, we find that no consolation is to be found to this sad affair. We are letting down our allies, and have been told that firmly. We are putting

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at risk our security and we are breaking our bond to those who make up one of the finest air forces in the world.
For these reasons, I hope and urge my right hon. and hon. Friends to join me in the Division Lobby.
9.32 p.m.
Mr. John: We have had an interesting debate dealing with important matters of detail with which I shall try to deal—ranging from the points made in the grand Guignol, groaning type speech made by the hon. Member for St. Albans (Mr. Goodhew) to the remarks of the hon. Member for Chingford (Mr. Tebbit).
Many questions have been asked, and I realise that I have been criticised for not having dealt with certain matters. However, it is inevitable in a winding-up speech that questions will be left unanswered.
Mr. Tebbit: The hon. Member will make Prime Minister yet.
Mr. John: The hon. Member for Chingford took 28 minutes to tell us what the situation was like in 1934. However, I promise that I shall answer hon. Gentlemen by letter on all points left unanswered in my speech.
The hon. Member for Newbury (Mr. McNair-Wilson) took exception to my absence from the debate earlier this evening, but I must draw attention to the fact that that hon. Gentleman is now absent and will not hear my reply. I was absent for only half an hour during the debate. I am sure it is accepted on ail sides of the House that there are other pressures on hon. Members in this Chamber which compel them to be absent for brief periods of time. I hope that there will be rather less of the yaboo childishness which that point of order displayed.
The problem which preoccupied many during the debate was the status of the MRCA project, particularly about whether it was on time and was performing satisfactorily, We are firmly committed to the MRCA project, as are our partners. That project is of major importance not only to the Royal Air Force but to British and European industry.
On 1st October 1974 the three Governments agreed to proceed with the second phase of the development. This is primarily concerned with flight development
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work sufficient to enable decisions which will be made early next year as to full production and entry to full production. The flight development work on the avionics equipment is being done on Buccaneer aircraft before being flown on the MRCA. There is also investment and procurement of essential equipment which will ensure the transition to production as smoothly as possible.
Reference has been made to air defence variants. The hon. Member for Chingford expressed reservations about the performance of the MRCA as an interceptor. We are at present in the project definition phase in which all these matters are being precisely examined with a view to our being able to reach a decision about the project as a whole. However, as I said earlier, this phase is due to be completed by the end of the year.
Mr. Tebbit: The hon. Gentleman has spoken at some length about the progress of the MRCA programme. No doubt quite accidentally, he has omitted to tell the House whether that programme is on schedule.
Mr. John: It is true that there have been fewer flight tests than had been hoped, but I have been assured that the delays are in no way inordinate and nor is the trouble which has been experienced in any way out of scale with that which is experienced in every other major new development. Our total planned requirement remains at 385 MRCAs but, as I said earlier—and as Conservative Members have been assiduous in pointing out—we have proposed to our partners a reduction in the peak annual delivery by up to one-third. I have been told that if this decision is implemented it will not have any major effect on overall costs.
Mr. Onslow: I am not quite clear what the hon. Gentleman meant when he said "If this decision is implemented". Is there some doubt whether the undertaking in the White Paper on Defence, to which we have not assiduously pointed but on which we have merely commented, is to be fulfilled? Is there some question whether our partners will agree to this delay in deliveries.
Mr. John: We are discussing this with our partners. I am trying to phrase this carefully to say that in advance of the completion of this discussion it must still

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be a question for discussion. We propose a slowing down in delivery rates by up to one-third. This would have no effect on the cost, which some hon. Members had feared.
Connected with this deduction has been the subject of the F16, which my hon. Friend the Member for West Lothian (Mr. Dalyell) raised at one stage. The right hon. Member for Brighton, Pavilion (Mr. Amery) also raised this matter during his remarks. The inquests which are taking place over the placement of the contract for the F104 replacement purchase are almost as diverse and penetrating as the struggles were for the contract itself. Clearly it was a matter of great importance, the lessons of which we shall take some time to absorb.
Nevertheless, there are two points which have not yet emerged from the debate. One is the influence which Eurogroup exerted, often against considerable national pressures, in the consortium to ensure that unity amongst the four countries was secure, so that a common purchase would have a significance for the future commonalty of aircraft in the NATO Alliance.
We may regret that the eventual choice did not fall on either a British or a European aircraft. Nevertheless, it is a voluntary alliance and the nature of a voluntary alliance is that we can only seek to influence and to persuade. We cannot dictate. Anyone who professes standardisation as being an acceptable and worthwhile goal for defence must face the fact that there will be occasions on which the alliance standardises on equipment other than our own, so that we cannot at one and the same time say that we are in favour of standardisation provided that they always standardise our terms.
Mr. Dalyell: Albeit it is a voluntary alliance, it has not been ascertained from the Belgian Government whether it was the rôle which they found unsuitable or the aircraft itself, which is rather a crucial question. After all, we are very close to them.
Mr. John: I have not finished with that rôle, but as I understand it, the primary requirements of the four countries ruled out the Jaguar, for example, at an early
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stage in the competition. The requirements they themselves laid down ruled that out.
The second question, which has not been raised, was that the determination to secure a common solution was indicative of the efforts being made in Eurogroup now to get to grips with the very difficult problem of standardisation of NATO weapons. One hon. Member referred to the need for common operational requirements. That is precisely one of the areas which Eurogroup, under the encouragement of my right hon. Friend, is currently pursuing.
Mr. Warren: What is the point of an organisation in which European Defence Ministers get together if they then agree on only one thing—to buy American equipment?
Mr. John: If the hon. Gentleman reflects on the nature of that intervention, I think he will feel that it does less than justice to the whole alliance, and particularly to Eurogroup. Eurogroup is a forum which discusses many aspects of European defence within the NATO Alliance, but it cannot and does not dictate to member countries what they shall buy. As I have said, sometimes we shall be disappointed by the process of standardisation, because harmonisation has no magic solution to many of the problems that have been posed here today. It is much easier to pose the problems of standardisation than to suggest solutions to them. We have lived with this problem for a quarter of a century. We hope that the current initiatives being taken will lead to greater standardisation in the future.
Mr. Amery: On the point about procurement, will the Minister say whether any operational requirement was proposed to the Belgian Government and the other Governments involved by Eurogroup or the NATO headquarters? If not, why not?
Mr. John: The right hon. Gentleman will know that each of the member countries seeks to fulfil a part of the alliance and a rôle in the alliance which will contribute towards the whole of the alliance. I am not in a position to answer that precise point now, but I shall let the right hon. Gentleman have a reply in due course.

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I turn to the question which has caused a considerable amount of unease—resettlement and redundancy. The hon. Member for St. Albans asked for the numbers of the officers who had volunteered for redundancy. Over 450 junior officers, 100 airmen-aircrew and about 650 airmen in the ground trades should by now have heard that their applications for volunteering have been accepted. But as I have said, some compulsory element—although there was an initial volunteering element—had to be retained within the system, precisely because of the need to get the structure of the RAF exactly and economically tailored to its new task.
But that is not the end of the story. I assure the House, especially the hon. Member for Plymouth, Drake (Miss Fookes), that we are taking considerable pains to make the best possible arrangements for resettlement. A series of over 80 resettlement forums has already been held on major stations, at home and abroad, and we have given guidance on the problems and opportunities of those facing redundancy. An extensive programme of resettlement courses has been arranged and there is a programme of longer courses which are now to be put into effect. I think that more courses will be arranged as the needs of the people concerned become more apparent.
This matter has been put forward as though we find it pleasant to make any person redundant. Clearly we do not. Many of us have family experience of unemployment and redundancy, which means that wherever and whenever redundancy occurs we never take it lightly. The fact is, however, that these officers and NCOs who are to be made redundant have between them considerable skills and attainments which are attractive to industry, even in this time of recession. We understand that already considerable interest has been expressed by employers about the men who are leaving.
There are special problems for air crew, but the resettlement organisation is paying particular attention to this matter and is to discuss it with the officers. I believe that the way in which they will be resettled will be a model of its kind. We are faced with a crucial, necessary and painful redundancy problem.
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My hon. Friend the Member for Salford East (Mr. Allaun) mentioned the question of the U2s at Wethersfield. I think he raised the same point in a Question which I answered on 11th June, but I shall repeat my answer. The Government were fully consulted in advance about the deployment of the aircraft and the conditions on which flights would be made. We gave our full agreement and we have therefore no intention of asking the United States Government to withdraw these aircraft before the trials have been completed.
The aircraft which crashed in West Germany crashed near Winterberg—85 miles inside the border. I do not know where my hon. Friend got the figure of six seconds from the East German border. It would take a matter of minutes rather than seconds to travel that distance, even in a fast aircraft.
Mr. Frank Allaun: With his usual courtesy, my hon. Friend is not evading questions, and we all appreciate that. The U2 plane was shot down 80 miles from the frontier, and flying at 500 mph that would take two or three minutes, but I understand that during the course of the flight—not at the moment it crashed—it was only six seconds flying time from the East German frontier. Does my hon. Friend think it prudent and helpful to have this kind of flight in this sensitive area on the eve of a disarmament conference?
Mr. John: My hon. Friend's information about the six seconds is not my information. My information is that at all times the aircraft was clearly in Western Germany, which, as a sovereign country, would have to have given permission for the flight. The U2s on these occasions did not have cameras and were not armed. I do not believe that the reaction of the USSR has been as sensitive as my hon. Friend suggested. This is a question which could not reasonably lead to any cessation of the security conference and the various initiatives for détente taking place this summer.
I say to the hon. Member for St. Albans that we do not believe at any stage that détente is a phoney matter. We approach it, as did the last Conservative Government, as a matter of realistic intent

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on both sides. Progress may not be easy, but if anyone disparages the chances of a true and lasting détente they are sharply at variance with this Government and the previous Conservative Government.
Mrs. Winifred Ewing rose——
Mr. John: I have to press on, since I am getting short of time and I have many questions to answer——
Mrs. Winifred Ewing: The Under-Secretary has not answered my questions.
Mr. John: All hon. Members would be happy if I were to answer their questions, but the more interruptions I have the fewer questions I can deal with.
Members have expressed fears, in the wake of the Defence Review, that our transport forces may be inadequate. As I said earlier, even after the extensive reductions the United Kingdom will still have the largest transport fleet among our European allies, and that the transport fleet will remain capable of carrying out its priority NATO tasks. An hon. Member raised the question whether, in an emergency, we could reinforce BAOR on a large scale. I must tell the hon. Member that, frankly, for a long time the large-scale reinforcement of BAOR has depended on the availability of a civilian airlift, and the position after the Defence Review is no different from what it was before. Powers already exist to enable my right hon. Friends the Secretaries of State for Defence and Trade to requisition, or direct the use of, aircraft of non-nationalised and nationalised air lines in the event of emergency.
I turn to the question raised by the hon. Member for Woking (Mr. Onslow) and my hon. Friend the Member for West Lothian on the new AEW aicraft. As was pointed out, this is a task which is currently carried out by the Shackleton aircraft. We are currently studying the provision of a replacement system. Possible solutions include one based on the Nimrod aircraft, on which we are currently funding national project definition studies, as well as the American AWACS, which is in limited production already for the American forces.
The need for an effective airborne early warning system is not a purely national matter. It must, by its very nature, be a
368
matter of considerable concern to all the Western Alliance which has an integrated air defence system. It is one where there ought to be common approaches and thereby considerable overall savings. That is why, at the same time as we are pursuing our national studies, we are also participating in NATO studies. The studies and assessment will take some time and it is hoped that a decision will be reached as soon as possible but certainly not this year.
Mr. Onslow: While the hon. Gentleman is on that point, will he deal with the point raised by my hon. Friend the Member for Hastings (Mr. Warren), that NATO is not studying a Nimrod replacement at all but is concentrating on the E3A. Is that a fact? Can the hon. Member confirm or deny that, please?
Mr. John: My information is that certainly NATO is studying the E3A but, nevertheless, the Nimrod has been brought to its attention.
Mr. Dalyell: The cost is £26 million apiece for the E3A and we would need 30 to 36 of them. Will my hon. Friend clear up the question whether NATO is being offered them by the Americans at a discount?
Mr. John: I told my hon. Friend earlier that I could neither confirm nor deny that figure at this stage. I hope my hon. Friend will defer that question until he receives the letter that I shall write to him after this debate.
The hon. and learned Member for Montgomery (Mr. Hooson) raised a point on North Sea oil and gas surveillance. He suggested, rather mysteriously, that this question had never been brought before the House. I can only say the hon. Gentleman must have suffered, rather untypically, from amnesia, because a statement was made by my right hon. Friend the Minister of State in the House on 11th February, and, more recently, on 23rd May, my hon. Friend the Under-Secretary of State for Defence for the Navy answered an Adjournment debate on the subject, when he gave a very full statement on our policy and, within the limits of security, our plans. But I welcome the opportunity to emphasise the rôle of the RAF in this new activity. At the present moment it is carrying out

369
twice-weekly patrols over offshore installations, using Vulcan, Nimrod and Shackleton aircraft, supplemented, when necessary, by all the other resources of the RAF, including Buccaneers, Jaguars and Phantoms. At the moment we are studying which of those aircraft is most appropriate for the new rôle. When we have decided that—and obviously we shall give Nimrod very careful consideration—we shall announce our decision to the House.
I regret that the time available does not permit me to deal very fully with the question of low-flying aircraft, but there are many apparently attractive solutions which, when closely examined, do not bear fruit. For example, there was the suggestion by my hon. Friend the Member for Brecon and Radnor (Mr. Roderick), to try to spread the burden by restricting low flying to particular areas on particular days. Alas, the weather is rarely settled enough for us to be able to make such announcements.
But, as I have said, low flying will no longer be carried out at weekends, unless there is advance notification. The great bulk of our low-level training will now be carried out during normal working hours between Monday and Friday. I think that it was the hon. and learned Member for Montgomery who asked what a weekend was. It begins after working hours on Friday and ends with the start of working hours on Monday. That is hardly the most ingenious or novel definition.
The hon. Member for Tynemouth (Mr. Trotter) raised certain other problems over low flying. He has courteously told me that he cannot be here for the wind-up of the debate and has apologised. We have not only low-flying routes but low-flying areas covering considerable territory. They are flown on a random basis, which is essential to training. It is possible that more pilots would be lulled into a sense of false security by knowing the outlines of the routes. The system of notification will ensure that in future the Royal Air Force keeps a careful look-out for them on the days when it has given notice that it will be flying at under 500 feet.
It is an experiment which will last for a year. We shall learn lessons from it, and at the end of the year, when the civil operators concerned will be able to express their views, modifications will be made or the system will be made more permanent.
The hon. and learned Member for Montgomery made an interesting point about the use of Andovers for relief work. The RAF has been pleased to take part in the relief of human distress, to which it has made an important contribution. Although I can give no assurance, I shall study what the hon. and learned Gentleman said, and shall inform him of my views in due course.
I turn to the question of the Sydenham requirement, which was mentioned by the right hon. Member for Belfast, East (Mr. Craig). The reduction of civilian numbers in Sydenham was announced as long ago as December 1971, which was before the RAF occupied the station. It was to have been implemented early in 1974, but it proved possible to extend the time during which work could be fed into the factory and therefore to defer the run-down for that time. The right hon. Gentleman said that the works had written to me and were awaiting a meeting. I have had no such letter, but if the trade unions wish to meet me on the subject I shall be glad to see them.
This is the end of a debate in which the Opposition have vainly tried to justify turning doubts into certainties and criticisms into condemnation of the Government's proposals. The House has already expressed its view about defence in approving the Government's statement in the recent defence debate. I hope that my hon. Friends and all other fair-minded hon. Members will support us in the Lobby and show their contempt of those who, while pretending to support the Royal Air Force, are prepared to vote against the Estimates which sustain it.
Question put, That this House do now adjourn:—
The House divided: Ayes 144, Noes 189.

Division No. 245.)

AYES

110.0 p.m.

Amery, Rt Hon Julian

Bennett, Sir Frederic (Torbay)

Biffen, John

Atkins, Rt Hon H. (Spelthorne)

Benyon, W.

Biggs-Davison, John

Baker, Kenneth

Berry, Hon Anthony

Blaker, Peter

Boscawen, Hon Robert

Hunt, John

Pattie, Geoffrey

Boyson, Dr Rhodes (Brent)

Hurd, Douglas

Pink, R. Bonner

Brittan, Leon

Hutchison, Michael Clark

Pym, Rt Hon Francis

Brotherton, Michael

Irvine, Bryant Godman (Rye)

Rathbone, Tim

Buchanan-Smith, Alick

James, David

Rees, Peter (Dover & Deal)

Burden, F. A.

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

Renton, Tim (Mid-Sussex)

Butler, Adam (Bosworth)

Kershaw, Anthony

Ridsdale, Julian

Chalker, Mrs Lynda

Kimball, Marcus

Roberts, Wyn (Conway)

Clarke, Kenneth (Rushcliffe)

King, Evelyn (South Dorset)

Rossi, Hugh (Hornsey)

Clegg, Walter

King, Tom (Bridgwater)

Host, Peter (SE Derbyshire)

Cockcroft, John

Kirk, Peter

Royle, Sir Anthony

Cooke, Robert (Bristol W)

Kitson, Sir Timothy

Sainsbury, Tim

Cope, John

Knight, Mrs Jill

St. John-Stevas, Norman

Cordle, John H.

Knox, David

Scott, Nicholas

Cormack, Patrick

Lamont, Norman

Shaw, Giles (Pudsey)

Costain, A. P.

Latham, Michael (Melton)

Shaw, Michael (Scarborough)

Critchley, Julian

Lawrence, Ivan

Shelton, William (Streatham)

Crowder, F. P.

Lawson, Nigel

Shersby, Michael

Dean, Paul (N Somerset)

Lester, Jim (Beeston)

Sinclair, Sir George

Douglas-Hamilton, Lord James

Lewis, Kenneth (Rutland)

Skeet, T. H. H.

du Cann, Rt Hon Edward

Loveridge, John

Speed, Keith

Durant, Tony

McAdden, Sir Stephen

Spence, John

Eden, Rt Hon Sir John

McCrindle, Robert

Spicer, Jim (W Dorset)

Emery, Peter

McNair-Wilson, M. (Newbury)

Spicer, Michael (S Worcester)

Fairgrieve, Russell

McNair-Wilson, P. (New Forest)

Stainton, Keith

Finsberg, Geoffrey

Madel, David

Stewart, Ian (Hitchin)

Fookes, Miss Janet

Marten, Neil

Stradling Thomas, J.

Fowler, Norman (Sutton C'f'd)

Mawby, Ray

Taylor, Teddy (Cathcart)

Gilmour, Sir John (East Fife)

Maxwell-Hyslop, Robin

Tebbit, Norman

Glyn, Dr Alan

Mayhew, Patrick

Thatcher, Rt Hon Margaret

Goodhew, Victor

Meyer, Sir Anthony

Townsend, Cyril D.

Gow, Ian (Eastbourne)

Miller, Hal (Bromsgrove)

van Straubenzee, W. R.

Gray, Hamish

Mills, Peter

Vaughan, Dr Gerard

Grist, Ian

Miscampbell, Norman

Viggers, Peter

Grylls, Michael

Moate, Roger

Walker, Rt Hon P. (Worcester)

Hall, Sir John

Monro, Hector

Wall, Patrick

Hall-Davis, A. G. F.

Moore, John (Croydon C)

Walters, Dennis

Hampson, Dr Keith

Morgan, Geraint

Warren, Kenneth

Hannam, John

Morris, Michael (Northampton S)

Weatherill, Bernard

Hastings, Stephen

Neave, Airey

Wiggin, Jerry

Hawkins, Paul

Nelson, Anthony

Winterton, Nicholas

Hayhoe, Barney

Neubert, Michael

Younger, Hon George

Higgins, Terence L.

Nott, John

Holland, Philip

Onslow, Cranley

TELLERS FOR THE AYES:

Hordern, Peter

Page, Rt Hon R. Graham (Crosby)

Mr, Spencer Le Marchant and

Howe, Rt Hon Sir Geoffrey

Parkinson, Cecil

Mr, Fred Silvester.

Howell, David (Guildford)

NOES

Allaun, Frank

Davies, Denzil (Llanelli)

Henderson, Douglas

Archer, Peter

Davis, Clinton (Hackney C)

Hooson, Emlyn

Atkinson, Norman

Deakins, Eric

Hoyle, Doug (Nelson)

Bagier, Gordon A. T.

Dean, Joseph (Leeds West)

Hughes, Mark (Durham)

Bain, Mrs Margaret

de Freitas, Rt Hon Sir Geoffrey

Hughes, Robert (Aberdeen N)

Barnett, Guy (Greenwich)

Dell, Rt Hon Edmund

Hunter, Adam

Barrett, Rt Hon Joel (Heywood)

Dempsey, James

Janner, Greville

Bates, Alf

Dormand, J. D.

John, Brynmor

Belth, A. J.

Douglas-Mann, Bruce

Johnson, James (Hull West)

Benn, Rt Hon Anthony Wedgwood

Duffy, A. E. P.

Jones, Alec (Rhondda)

Blenkinsop, Arthur

Dunn, James A.

Jones, Barry (East Flint)

Booth, Albert

Dunnett, Jack

Jones, Dan (Burnley)

Bray, Dr Jeremy

Dunwoody, Mrs Gwyneth

Judd, Frank

Brown, Hugh D. (Provan)

Eadle, Alex

Kaufman, Gerald

Brown, Robert C, (Newcastle W)

Edelman, Maurice

Kerr, Russell

Buchanan, Richard

Ellis, John (Brigg & Scun)

Kinnock, Neil

Callaghan, Jim (Middleton & P)

Ellis, Tom (Wrexham)

Lambie, David

Campbell, Ian

Evans, John (Newton)

Lamborn, Harry

Canavan, Dennis

Ewing, Harry (Stirling)

Lamond, James

Carmichael, Neil

Ewing, Mrs Winifred (Moray)

Leadbitter, Ted

Carter-Jones, Lewis

Fernyhough, Rt Hon E.

Lestor, Miss Joan (Eton & Slough)

Castle, Rt Hon Barbara

Fitch, Alan (Wigan)

Lewis, Arthur (Newham N)

Clemitson, Ivor

Flannery, Martin

Lewis, Ron (Carlisle)

Cocks, Michael (Bristol S)

Fletcher, Ted (Darlington)

Lipton, Marcus

Cohen, Stanley

Fowler, Gerald (The Wrekin)

Lomas, Kenneth

Coleman, Donald

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

Loyden, Eddie

Cook, Robin F. (Edin C)

Golding, John

McElhone, Frank

Corbett, Robin

Gourlay, Harry

MacFarquhar, Roderick

Cox, Thomas (Tooting)

Grant, John (Islington C)

McGuire, Michael (Ince)

Cralgen, J. M. (Maryhill)

Grimond, Rt Hon J.

Mackenzie, Gregor

Crawshaw, Richard

Grocott, Bruce

Mackintosh, John P.

Cryer, Bob

Hamilton, James (Bothwell)

McMillan, Tom (Glasgow C)

Cunningham, G. (Islington S)

Hamilton, W. W. (Central Fife)

McNamara, Kevin

Cunningham, Dr J. (Whiteh)

Hardy, Peter

Madden, Max

Dalyell, Tam

Harrison, Walter (Wakefield)

Magee, Bryan

Davies, Bryan (Enfield N)

Heffer, Eric S.

Marks, Kenneth

372

373

Marquand, David

Reid, George

Thompson, George

Marshall, Jim (Leicester S)

Richardson, Miss Jo

Thorne, Stan (Preston South)

Mason, Rt Hon Roy

Roberts, Albert (Normanton)

Tinn, James

Maynard, Miss Joan

Rodgers, George (Chorley)

Tomlinson, John

Meacher, Michael

Roper, John

Torney, Tom

Mellish, Rt Hon Robert

ROM, Stephen (Isle of Wight)

Tuck, Raphael

Mendelson, John

Ross, Rt Hon W. (Kilmarnock)

Wainwright, Edwin (Dearne V)

Mikardo, Ian

Ryman, John

Walker, Terry (Kingswood)

Miller, Dr M. S. (E Kilbride)

Selby, Harry

Ward, Michael

Mitchell, R. C. (Soton, Itchen)

Sheldon, Robert (Ashton-u-Lyne)

Watkins, David

Molloy, William

Short, Rt Hon E. (Newcastle C)

Welsh, Andrew

Morris, Charles R. (Openshaw)

Silkin, Rt Hon John (Deptford)

White, Frank R. (Bury)

Murray, Rt Hon Ronald King

Sillars, James

White, James (Pollock)

Newens, Stanley

Silverman, Julius

Whitlock, William

Oakes, Gordon

Skinner, Dennis

Williams, Alan (Swansea W)

Ogden, Eric

Small, William

Williams, Alan Lee (Hornch'ch)

Orbach. Maurice

Smith, Cyril (Rochdale)

Wilson, Alexander (Hamilton)

Orme, Rt Hon Stanley

Smith, John (N Lanarkshire)

Wilson, Gordon (Dundee E)

Ovenden, John

Snape, Peter

Wilson, William (Coventry SE)

Palmer, Arthur

Spearing, Nigel

Wise, Mrs Audrey

Park, George

Spriggs, Leslie

Woodall, Alec

Parry, Robert

Stewart, Donald (Western Isles)

Woof, Robert

Pavitt, Laurie

Stewart, Rt Hon M. (Fulham)

Wrigglesworth, Ian

Pendry, Tom

Stoddart, David

Young, David (Bolton E)

Penhaligon, David

Stott, Roger

Phipps, Dr Colin

Strang, Gavin

TELLERS FOR THF NOES

Prescott, John

Taylor, Mrs Ann (Bolton W)

Miss Betty Boothroyd and

Price, C. (Lewisham W)

Thomas, Ron (Bristol NW)

Mr.Joseph Harper.

Price, David (Eastleigh)

Question accordingly negatived.

SOCIAL SECURITY BENEFITS
10.12 p.m.
The Under-Secretary of State, Department of Health and Social Security (Mr. Michael Meacher): I beg to move,
That the Social Security Benefits Up-rating Order 1975, a draft of which was laid before this House on 11th June, be approved.
Mr. Speaker: It might be for the convenience of the House if we discussed at the same time the second motion,
That the Supplementary Benefit (Determination of Requirements) (No. 2) Regulations 1975, a draft of which was laid before this House on 11th June, be approved.
Mr. Meacher: The purpose of these two instruments is to increase in the one case the main national insurance and industrial injuries benefits and in the other the supplementary benefit rates in the way described by my right hon. Friend the Secretary of State in her statement to the House on 22nd May. The increases will come into force from the week beginning 17th November, just over seven months after the last uprating, which took place in the week beginning 7th April 1975.
I shall deal first with the draft order and then turn to the draft regulations. By leave of the House I should like to deal later with any points of detail raised during the debate on either the order or the regulations.
The Government are committed by law to increasing pensions and other long-term benefits in line with the movement in the general level of earnings unless the movement in the general level of prices would be more advantageous to those concerned. For short-term benefits the criterion is the movement in the general level of prices. My right hon. Friend is statutorily obliged, under Section 125 of the Social Security Act 1975, to review benefits in every tax year in order to determine whether the rates have retained their values in relation to the general level of earnings or prices and, if not, to adjust them. This order represents the outcome of my right hon. Friend's statutory review for the year 1975–76.
The House will be aware that this is the first occasion on which benefits have
376
been increased by means of an order. Previously—14 times since 1948—an up-rating Act has been necessary. I make no political point here since the 1973 Social Security Act of hon. and right hon. Gentlemen opposite similarly provided for upratings by order.
As regards the details of the increases proposed, I should remind the House that the last uprating, which increased pensions and benefits, as I have said, from the week beginning 7th April 1975, took into account the movement in earnings and prices up to August 1974. Since the interval between that uprating and the one now proposed for November will be just over seven months, my right hon. Friend considered the movement in both earnings and prices over the seven months from August 1974 to March 1975. I realise that later information is now available but, when the Government's proposals were formulated and announced to the House before the Whitsun Recess, the information on which those proposals were based was the most up to date. Changes in the movement of earnings and prices after March 1975 will of course be reflected in the next following uprating.
The reason for the early announcement of our proposals was that, in order to effect the uprating and deal at the same time with the other improvements which are also to become operative from the week beginning 17th November, the local offices of the Department have had to start issuing order books containing the new rates subject to parliamentary approval. I am sure that the House will accept the need for an early start on the very heavy programme involved, to which my right hon. Friend referred when she made her statement on 22nd May. The programme is a heavy one because, apart from the increases provided by this order, there are the increases in supplementary benefit rates provided by the regulations which the House is also considering, and increases in war pensions to be made by means of instruments under the Royal Prerogative. At the same time, the new non-contributory invalidity pension will be introduced, the supplementary benefit discretionary additions for extra heating and dietary needs will be increased, and

377
the changes in supplementary benefit disregards which are already enacted will be implemented. I shall return later to these changes in supplementary benefit.
Turning now to the specific proposals which are reflected in the order, these are based on the movement in earnings over the seven month period to which I have referred, from August 1974 to March 1975, of nearly 15 per cent. The movement in prices over the same period was just over 13 per cent., so that it is to the advantage of pensioners and other longterm beneficiaries if we have regard to the movement in earnings rather than prices.
Benefit rates are generally rounded, and the proposed increase of £1·70 in the standard rate of retirement, invalidity and widows' pensions, from £11·60 to £13·30, represents an actual increase of 14·7 per cent. The pension for a married couple will go up by £2·70 from £18·50 to £21·20, an increase of 14·6 per cent. There will be proportionate increases in the rates for children and in the reduced rates payable to younger widows and to pensioners who have not satisfied the contribution conditions in full.
I do not intend to take up the time of the House by comparing all the proposed increased rates with the existing ones since a complete table was circulated, together with my right hon. Friend's statement in the Official Report, and there is a list in Appendix 1 to the Government Actuary's Report which accompanies the order, and which I am sure hon. Members have seen.
Short-term benefits for sickness and unemployment will go up in line with the movement in prices. The standard rate for a single person will be increased by £1·30 and go from £9·80 to £11·10—an increase of 13·3 per cent. For a married couple, the increase will be £2·10, from £15·90 to £18—an increase of 13·2 per cent. Earnings-related supplement of up to £9·37 can, of course, be paid in addition.
Maternity allowance and industrial injury benefit will go up by the same amounts as sickness and unemployment benefits. Other pensions and benefits under the industrial injuries scheme will go up in line with long-term benefits. The pension for 100 per cent. disablement will go up from £19 to £21·80 and
378
the industrial injuries widow's pension will be increased from £12·15 to £13·85.
Turning to the order itself, I am sure that hon. Members on all sides of the House will welcome its brevity and simplicity. Article 1 is formal. Article 2, together with the Schedule, provides for the increases in benefits by amending the rates and amounts contained in Schedule 4 to the Social Security Act 1975. No increase is proposed on this occasion in maternity grant, death grant or age addition, which are benefits that my right hon. Friend is not obliged to review under section 125 of the Act. Article 3 provides for the dates from which the various increases in benefits are to take effect—generally the appropriate day in the week beginning 17th November on which a particular benefit is normally paid. The other provisions of Article 3 are technical and have traditionally been included in the commencement orders relating to uprating Acts.
I turn now to the draft regulations which provide for increases in the scale rates and in certain other amounts laid down by Schedule 2 to the Supplementary Benefit Act 1966. The scale rates are the basic element in the calculation of a person's supplementary benefit requirements, and the increases proposed in the main scale rates are the same as the national insurance pension and benefit increases to which I have already referred. They will come into operation at the same time as the national insurance increases, that is from the week beginning 17th November 1975.
Turning to the details of the increases, Regulation 2 provides for new rates of £13·70 for the single householder and £21·55 for a married couple. These represent increases in the long-term scale rates of £1·70 for a single householder and £2·70 for a married couple. The long-term scale rates apply to supplementary pensioners and to people, other than the unemployed, who have received a supplementary allowance for two years. Where a supplementary pensioner or his wife is over 80, the scale rates will continue to be 25p higher at each point.
The ordinary scale rates, which apply to the unemployed and to people who have received a supplementary allowance for less than two years, will be increased by £1·30 for a single householder to

379
£10·90, and by £2·10, to £17·75, for a married couple.
Scale rates for other adults and for children are also being increased. The special rates which apply to the blind will go up by the same amounts as the corresponding rates for sighted persons so that their preference will be continued. Increases in the amounts added for attendance requirements are also proposed, of the same amounts as the increases proposed in the attendance allowance itself.
A claimant who lives as a member of another person's household receives a standard weekly addition for rent. This is to be increased by 5p to £1 a week. As a result of the changes in the scale rates and standard rent additions made by these regulations, the income of adult non-householders will go up by £1·40 a week for supplementary pensioners and other long-term recipients, and by £1·10 for other non-householders.
I apologise for this continuous stream of detailed factual information. I can assure hon. Members that there is only a little more. Perhaps I can complete what is a rather long list.
Over and above the increases provided for in the regulations, my right hon. Friend announced on 22nd May that the Supplementary Benefits Commission will be increasing the discretionary extra heating additions from 40p, 80p and £1·20 to 55p, £1·10 and £1·65 respectively. The standard additions for special diets are also to be increased, from 50p to £1·12 to 60p and £1·35 respectively. All these changes will take effect from 17th November 1975.
I should also remind the House that increases in the amounts which may be disregarded in the calculation of a claimant's resources, provided for in the Social Security Benefits Act 1975, will come into effect at the same time as the new scale rates. About 12 million people will benefit from the increases proposed in the draft order and the draft regulations and from the associated changes proposed in war pensions.
The uprating provides a way of protecting from the effects of inflation those whose standard of living depends upon social security benefits. Our prime objec-
380
tive remains to bring inflation under control. That is why we have expressed our intention to return to an annual review of benefits. But while we continue to experience inflation at an exceptionally high rate, we are determined to protect pensioners and other beneficiaries, especially those receiving supplementary benefit, who are by definition amongst the poorest in the community. On the basis of our record we can be justly proud of what has so far been achieved. Since coming into office we have already, in two upratings, increased the standard rates of retirement pensions——
Mr. James Dempsey: When my hon. Friend outlines these discretionary allowances will he say whether he has considered discretionary allowances for telephone services for old age pensioners?
Mr. Meacher: My hon. Friend has drawn attention to an important point. There is nothing in this order or in these regulations to assist in that respect. He will know that under the Chronically Sick and Disabled Persons Act 1970 there is provision for local authorities to provide the disabled, who are by and large the elderly, with assistance in this respect. There is also provision by the Supplementary Benefits Commission in exceptional cases, but, I believe, in very few. I would advise the hon. Gentleman's constituents who are affected to get in touch with their local authority social services department, which is the proper authority to assist.
Since we came to office we have already, in two upratings, increased the standard rates of retirement pensions by about 50 per cent., and by November, under this uprating order, if the House approves it, the increase will be about 70 per cent.
Sir Brandon Rhys Williams: In real terms?
Mr. Meacher: I shall come to that point if the hon. Gentleman will permit me.
Prices, on the other hand, had increased up to last month by less than 32½ per cent. since February 1974—or, going back to the last uprating under the previous Conservative Government, which is fairer, prices have increased by just over 39 per cent. since October 1973. Therefore, in broad terms, up to last

381
month, since the time of the last Conservative Government uprating, prices had risen by just under 40 per cent. while benefits had risen by just under 50 per cent.
The financial consequences of the increases in national insurance and industrial injuries benefits are dealt with in the Government Actuary's Report, Cmnd 6083, which was laid before the House together with the draft order to which I have already referred.
The annual cost of the proposals embodied in the draft order and the draft regulations is about £1,015 million. There will at the same time be an additional annual cost of £32 million for war pensions and of £11 million for the increases in supplementary benefit discretionary additions. Of this total, £908 million a year will fall on the National Insurance Fund. This will be taken into account in the review of contributions for 1976–77 which will be undertaken later this summer and which will reflect the need to ensure that the fund remains soundly financed.
On the basis of what I appreciate has been a detailed speech, which was no doubt difficult to follow, I have pleasure in commending this order and the regulations to the House——
Sir Brandon Rhys Williams: Before the Minister finishes may I remind him that he pointed out that the volume of figures was difficult to absorb. I hope that he will be able to help us with some guidance as to the principles which were followed in making this tremendous range of benefit increases. He mentioned increases in percentage terms within the global total. Do all the increase correspond to one percentage increase or to an increase in terms of pence or pounds per week?
Mr. Deputy Speaker (Mr. Oscar Minion): Order. What was meant to be an intervention is developing into a speech. I do not know whether the Minister would care to reply to it before I propose the Question.
Mr. Meacher: The broad principle behind the percentage increase is to take account of the increase in earnings in the seven previous months, the figure of seven representing the difference in time between the announcement of the uprating and
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the date when it will be carried out. That is the broad principle that underlies all the figures I have given, except for the short-term rates, when it is the movement of prices for the same period that informs the figures. If the hon. Gentleman wishes to raise other points, I suggest that he waits until he catches your eye, Mr. Deputy Speaker.
10.30 p.m.
Mr. Norman Fowler: I should, first, like to welcome the Minister back to the social services. I think that this is the first speech he has made in the House since his appointment——
Mrs. Jill Knight: It is his second.
Mr. Fowler: In that case I will keep my welcome even shorter, with no disrespect to the hon. Gentleman, whom we are glad to see back.
This is the second uprating we have had this year. The last increase in pensions and benefits was made in April. The new increases for which the Government seek approval will be paid in November.
The reason for these further increases is not the generosity of the Government, as one might have thought from the Minister's speech. It is not a positive step towards improving the real living standards of people who are retired and are in need. It is a desperate attempt to keep up with inflation. It is an action that has been forced upon the Government by the disastrous collapse of their economic policies.
The crucial question concerns the level of inflation. The increases are based on a 15 per cent. increase in earnings between August and March and a 13 per cent. increase in prices. That is equivalent to a 25·7 per cent. annual increase in earnings and a 22·3 per cent. annual increase in prices. By any standards those increases are high enough, but the economic situation has deteriorated even further. Rather than improving, the position has worsened and inflation is already eroding the value of the increases we are debating tonight.
Let us consider what the increases when payable will be worth in today's money. The retirement pension for a

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single person is now set at £13·30 and it falls to be paid not now but on 18th November. If inflation continues at the rate we have experienced over the past six months, that pension will be worth £11·35 when it comes to be paid. If inflation continues at the rate experienced over the past three months, it will be worth £10·65. In today's money the retirement pension for the married couple is set at £21·20. If inflation continues at the rate experienced over the past six months it will be worth just over £18, and on the three months' figure it will be worth just over £17.
That is the horrifying truth of our economic crisis. Inflation is defeating all our hopes. It is hitting at the most vulnerable sections of the public. It is striking at those least able to protect their own interests, the retired, the sick and the disabled—all the people whom these benefits are meant to protect and help. Beyond doubt, inflation presents us with the greatest social problem the country faces.
Even now, Department of Health and Social Security Ministers go around the country talking of a rosy pensions future and of the new Social Security Pensions Bill, omitting to mention that the Bill does not come fully into effect until 1997. The Opposition are concerned about the current generation of pensioners, the people who are retired now, the people whom the order is about and who under the Labour Government are losing out.
That point was made clearly by the Child Poverty Action Group which said in a memorandum to the Government.
"For the first time since the depression of the inter-war years the Government are planning real cuts in the living standards of the poor. Real cuts in benefits are planned because the November increase will not make up for the rate of inflation between now and the end of the year."
It would be comforting to think we were running harder even to stay in the same place, but we are running harder only to see the position deteriorating faster all the time. The truth is—and I think it would be good for the Under-Secretary of State to acknowledge this when he makes his winding-up speech—that no uprating order will be able to cope with the kind of inflation that we now face. This order does not cope and
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no succeeding order will cope unless action is taken.
Nevertheless, I am interested in Government policy on the frequency of upratings which the hon. Gentleman mentioned. This is the second uprating we have had this year. We have reached the stage when upratings take place at the rate of one each seven months. I accept that there is nothing in social security legislation which precludes that. The Government have admitted that the up-ratings are the direct product of the super-inflation we are now experiencing, yet even now the Government say that the six-monthly reviews which are proposed are impracticable.
In her statement in May the right hon. Lady the Secretary of State made it clear that she intended to move back to annual upratings. The hon. Gentleman has also made that point clear tonight. This is a question of some importance in considering the order. It is right that we should know the exact nature of the Government's objections to the proposal for regular six-monthly reviews. The usual reason which has been given is that there are administrative difficulties. That has been the argument of the right hon. Lady and her right hon. Friend the Minister of State, Department of Health and Social Security. The Government's case is that, irrespective of the rights of the matter, administrative difficulties make more regular reviews impossible.
A new light has been thrown on this departmental excuse by The Sunday Times in an article published last Sunday. The article goes back to the 1964 pensions increase which was announced in November 1964 but which, in spite of enormous pressure, was not paid until April 1965. The excuse used at that time was administrative difficulties. In his book the Prime Minister wrote:
"Through sheer administrative difficulties it was impossible to bring them into effect until early Spring … it was simply not possible."
That has already been challenged by Lord George-Brown. The noble Lord has explained that it was not administrative difficulty but the acute economic crisis which forced that delay 10 years ago. The argument is now supported by the late Richard Crossman in his diaries. Mr. Crossman reveals that the Government had worked out a scheme.

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According to him, Peggy Herbison, the Minister responsible at the time, had worked out a back-dating scheme as instructed but she received nothing but almost universal hostility from the Cabinet.
Let me make my point absolutely clear. It is clear that the then Labour Government had decided that it was possible to have the back-dating of pensions—in other words, though the pension would be paid in April, it would be backdated to Christmas. Of course that is not the same as being able to pay out a pensions increase at the time a Government want it to become due. The same excuse of administrative difficulties trundled out by the Prime Minister in his memoirs and demolished so effectively by Mr. Crossman appears to be being used again. We would welcome the hon. Gentleman's statement of policy.
My hon. Friend the Member for Rushcliffe (Mr. Clarke) will deal with the part of the order dealing with supplementary benefits, and I know that many of my hon. Friends want to take part in the debate. I wish to reiterate one point. No system of uprating will compensate the pensioners for the kind of inflation which we are now facing in Britain. It should be a matter of agreement between the parties that our aim as a Parliament is to protect the interests of retired people. It follows that it should also be a matter of agreement between the parties that inflation should be tackled. But the Government have failed to tackle inflation—and that failure to act affects no group more harshly than the millions of retired people.
10.40 p.m.
Mr. William Molloy: I suppose we should congratulate the hon. Member for Sutton Coldfield (Mr. Fowler) on taking on a difficult task this evening. He referred to difficulties which occurred 10 years ago but he conveniently forgot to mention that Labour had introduced the largest increase in the old-age pension that this country had ever seen. Millions of old people had been suffering from an economic crisis, and the Labour Government in the period 1964–66 made a real contribution by uplifting the standards of living of those people.
Although there has been an argument, indeed a post mortem, in regard to the
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events of past years, the fact was that the then Minister, Miss Peggy Herbison, investigated the situation and was appalled at the neglect that she found in the Department. My hon. Friend the Member for Bethnal Green and Bow (Mr. Mikardo) was involved in an examination of the situation and it was discovered that the Department was run down and that there was hardly a computer in the place to assist in resolving complicated issues.
While I am on that topic, it might be as well to draw attention to the amount of complication that has entered this sphere of activity. The quicker we get back to Aneurin Bevan's solution—he always had an immaculate solution and indeed has demonstrated it sometimes almost from the grave—the better. Why not do away with the contributory elements? Let us do away with all the cards and stamps. There is even a machine to spoil the stamps once they are stuck on. All that effort is going into one simple requirement: that of making available to British people from the cradle to the grave medicaments, the service of doctors, amublance men and the facilities of our great hospitals. Surely it is right that we should seek to do so without all the complication of stamps and cards. One day this country will arrive at a proper solution.
The hon. Member for Sutton Coldfield was right to say that the Government in these orders were endeavouring to cope with ever-increasing inflation. He must also acknowledge that 15 or 20 years ago no Government would have dreamed of increasing, within six months or a year of the original provision, any form of supplementary benefit or pension simply because there had been a minor increase in inflation of 4 or 5 per cent., even though that was a terrible thing for the 10 million people who found themselves in a desperate situation.
Let me say at the outset that I welcome the orders. The Opposition would have had a better case tonight if, in view of the rapid rise in inflation, they had appealed for provisions on the lines of the present orders to be brought in, but they must make some sort of excuse as to why it is necessary in any case.
However, I believe that this House, the economists and people in the City are

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inadvertently completely misleading Ministers and Members of Parliament in the figures which they are giving us in relation to price rises. The average housewife knows that hardly a week passes without a little increase in the price of something. For example, the price of a writing pad which my wife bought recently has risen over the past month from 5p to 23p. Horse lovers no longer buy a couple of penn'orth of carrots because it is cheaper to buy apples. The economists miss this sort of thing—the price of dresses; the boy's cap; the pair of stockings for the lad starting a new term at school. These things are not considered by the very clever gentlemen who work out the wonderful figures about inflation and price rises.
What is happening? Some trade unionists say "You are saying to us that the profit element must be maintained. It has been maintained for nearly five years. The case is made and the price increase is allowed. Many of the wage increases for working men are not put into the bank but are used to pay for the increased prices, rates and rents." I admit that there must be an all-round contribution. I am one of those who happen to believe that there must be massive restraint in the wages sector. But there must be a corresponding restraint in the profit sector—on the million-and-one little articles which the ordinary housewife must buy.
The order is essential to meet an already encroaching form of increase in the cost of living of the ordinary family, which is hitting pensioners and those on supplementary benefits hardest. The Government have acknowledged this, and that is why the order has been introduced. It is the result of humane thinking and consideration for this sector of the population.
By itself, the order is not the answer. We cannot go on and on having wage increases—this is the key—argued for by trade unionists to meet the increased bills of the grocer, the greengrocer and the landlord, and the rates. That is why these increases are wanted. When they are granted, there is further escalation of prices, so the round starts again. We all know the argument. Somehow or other it must stop.
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For this order to have any effect, and if the Minister is not to return to the House in a month's time with something similar, at the rate we are going, he and his Department must increase their influence on other Departments. There must be a sensible collaboration between trade unions and employers in halting inflation. We are all agreed that this must be the key. That is the real contribution.
I believe that the impressive official figures from authoritative sources about price increases are a load of baloney. The average housewife is much more experienced as to what she has to pay out. She has to pay a couple of pence extra here in the morning and a few more pence extra in the afternoon, for six days a week, on odds and ends which are causing a big hole in her purse.
The first thing that we must do to make any reality of this sort of order is to ensure a much more savage and realistic control of the prices of all sorts of little things which the economists ignore but the increasing prices of which irritate the housewife. By adopting a much more realistic policy of controlling prices we shall have the right to go to the unions and the wage and salary earners with the argument that the curve on prices is dipping and that they must therefore hold back on pay demands. The only people who would be entitled to creep up to a higher standard would be the sort of people who would benefit from this order.
In spite of our economic problems, it would be a sadder House of Commons if this order had not been presented tonight. At least it shows that the House and the Government have not forgotten the less fortunate in society.
10.51 p.m.
Mr. David Penhaligon: If the hon. Member for Ealing, North (Mr. Molloy) is suggesting that inflation is higher than the 26 per cent. that I understand it has now reached, we are indeed in dire straits.
I am grateful for the Under-Secretary's explanation of the reviews. I was struck by how unbelievably complicated is the system we have evolved for paying benefits in this category. I shall endeavour to concentrate on the bulk of those involved in these orders—the pensioners and those on supplementary benefits.

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We have been told that the pensioners are being given an increase of 14·6 per cent. to cover inflation for seven months based on wage inflation for the period. That figure is the equivalent of 25 per cent. on an annual basis. I looked out the latest figures tonight in the Library and I discovered that we are now suffering wage inflation at a rate of 30·5 per cent. It could therefore be argued that in this review the pensioners have lost 5 per cent. under even a statutory obligation, as the Under-Secretary described it, to increase pensions.
The fact is that under a system of historic reviews in a period of rising inflation pensioners are always behind. There is no great need to explain that point, but it follows that when we manage to reduce inflation these people might do very well from the review.
One aspect of inflation which is not often mentioned in connection with pensions is that if over a period inflation is running at 10 per cent., at the end of that period the pension is worth 5 per cent. less than the original figure. If inflation rises to 30 per cent. the real value of that pension is 15 per cent. less on average. It is this which has made the increased upratings or shorter periods between upratings necessary.
The hon. Member for Sutton Coldfield (Mr. Fowler) argued for a system of six-monthly reviews. If that were introduced I would not oppose it, but surely it is time to look not for a specific period of review but for a system by which pensions are automatically increased if a certain level of price increase is exceeded—let us say 10 per cent. That would protect the real value of the pension over a period.
I turn to the abolition of the Christmas bonus. My wife runs a village sub-post office in Cornwall. Until I was elected it was my job to serve on Saturday mornings, but I am now banned from doing so. I met many pensioners, and it was a great education. The Government underestimate how much the Christmas bonus was appreciated. It meant that there was at least one time in the year when many of our pensioners were not desperately short of money. I still think that the abolition is bad.
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Leaving that aside, I point out that the £10 per head was in real terms a week's extra benefit a year. It was 2 per cent. of the pensioner's average income per year. We can look at the matter in two ways. It can be said that the money which the Government save by not paying the Christmas bonus has, in effect, postponed the increase in pensions for seven weeks. That is approximately the period over which the average pensioner will receive the extra benefit before the time when he would have received his Christmas bonus. In that sense the Government have not brought forward the increase but have put it back to 1st January 1976. Alternatively, it can be said that the pensioners have received a 2 per cent. drop in their income by this move—and that is how I view it.
Adding the 5 per cent. that I mentioned earlier to the 2 per cent., we at least have a case that the pensioners have had a real drop in their total income for the year of about 7 per cent., as a result of the review and inflation. We all know that we must do something to try to reduce public expenditure and to balance the books, but a net reduction in pensions of 7 per cent. is not the place to start.
If there were an effective way in which we could amend the order I should be tempted to do so, but although there are times when I do not understand very well how the House works, I understand that that is impossible. Therefore I can only welcome the uprating. But I ask the Minister to look into my arguments, which indicate that there is a case that the pensioners are not being as well treated in the review as the Minister said.
10.58 p.m.
Mrs. Lynda Chalker: While they welcome the uprating, my constituents are very fearful about exactly the matters the hon. Member for Truro (Mr. Penhaligon) has just described. It is vital that the Government get to grips with the root cause of our having to continue to consider further upratings which are necessary in order to bring pensioners up to the level that we hope to see them reach compared with the rest of the working population. To have to raise pensions simply because we cannot control our public expenditure, because we cannot run the economy properly, is a denial of government.

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The seriousness of the situation was brought home to me more vividly than ever before when, last week, a pensioner in my constituency sent me a 100,000-deutschemark note, telling me that in the 1930s, when he purchased it, it was worth one and a half old pennies.
Mr. Molloy: They could not have been deutschemarks.
Mrs. Chalker: I am corrected by the hon. Gentleman, who remembers that age better than I do.
The words of every letter that I receive each day from pensioners worry me no end. It is not only the pensioners but the lower income families and the one-parent families who are trying to deal with increases which are not calculated within the Family Expenditure Survey or the retail price index. These are the people who are up against it, and the children in some of the families are today, unfortunately, turning to other ways of finding money. That is something which we should not encourage.
It is not just a question whether they can live much as they did before. Perhaps some can, but I have yet to find them. It is now that the telephone is being returned; that the television is being returned; that they cannot use the night storage heating which they were sold as an economic means of keeping themselves warm—all because they cannot afford them.
Despite the increases in the dietary allowances which the Under-Secretary mentioned with great skill, with all the figures at his fingertips, there are people with great disabilities and a special need for food which is not in the general range at which we look in considering price increases.
It is the total inability of the system to care for those most in need while nothing is done to stop those with the greatest greed which depresses me. I welcome what the Under-Secretary said, but I wonder whether the hon. Member for Ealing, North (Mr. Molloy) could have made those remarks when the Under-Secretary was speaking, rather than interrupting all the way through.
With the problems that elderly people face they will not die happily and they
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feel they will die a lot sooner. I notice that we are doing nothing to help with the death grant, but I shall leave that matter to another hon. Member.
I should like the Under-Secretary to answer this question: Why are we spending a great deal in organisation and the issue of new 12-week order books, instead of continuing with the overstamping of pages in the order books? I understand from a subpostmistress in my constituency that instructions have been received no longer to overstamp increases in benefits but to issue new books every 12 weeks. That seems a total waste of public money, when the extra might be given to those in need.
We welcome the fact that there will be an increase, but we ask the Government to go one step further—to control inflation so that the increase will have some merit when it gets into the pockets of the beneficiaries and pensioners.
11.3 p.m.
Mr. Hal Miller (Bromsgrove and Red-ditch): After that powerful intervention by my hon. Friend the Member for Wallasey (Mrs. Chalker) I can be brief. The question I wish to put to the UnderSecretary—to whom I pay tribute on his second appearance in two days and on his mastery of a complicated brief—without probing deeply and unkindly, is whether I may have a breakdown of the population of 12 million people whose standard of living depends on social security benefits.
I hope that the Minister will illustrate the breakdown of that population, because he must be aware—and the House should be aware—of the rising tide of discontent about the number of people who are in receipt of supplementary benefit and who are perfectly able to work and are capable of finding work and moonlighting.
I had in my advice bureau a constituent, admittedly a Labour shop steward, who said that his will to work was crumbling because his neighbour was able to lie in a deckchair, watching the grass grow, while he was on piece work and his wife was complaining about how late he came home.
If these benefits are to be increased in future in the manner set out in the order, there will be a rising demand that the people benefiting from the increases

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should be subjected to much closer scrutiny than is carried out at present for those in receipt of unemployment benefit.
The points that I wished to make other than that are comparatively minor. None the less, they are very real to those who are affected. I wish to refer in particular to the position of widows and to express regret that the order makes no attempt to improve the lot of younger widows whose pensions are not uprated to the full amount when they reach the age of 50. I hope that the Minister will be able to indicate that that point will be considered by his Department when the position has to be reviewed again.
The feeling amongst all widows is that it is unfair that their pensions should be taxed to the present extent. The Minister has not been entirely candid with the House about the effect of taxation on some of the increases proposed in the order. I do not think that they are entirely net figures.
The hon. Member for Truro (Mr. Penhaligon), who has left the Chamber—we get accustomed to Liberal Members departing when they have made their contributions—referred to the Christmas bonus. I support what he said on that matter. However, what he did not make plain was that the Christmas bonus represented a lump sum—a sum which the pensioner might not have been able to save out of the weekly pension—which, when the Christmas season came, enabled him to give small gifts to the closest members of his family, particularly the grandchildren. It had not only a sentimental, but a real value to the pensioner, because it was suddenly available and represented, as it were, something that he might have been able to save.
Finally, I want to refer to the continuing inequities for the self-employed—for example, the directors of small firms—who have become fully employed from 5th April and whose benefits will not be payable until 1st January 1977. The effect of inflation is leaving them still further behind. That aspect also applies to those for whom unemployment has unfortunately begun near the end of a year.
For example, a constituent of mine wrote to me this week saying that he had
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become ill in November 1974 and was assessed for his benefit on his tax year 1972–73. With inflation continuing at the rate that we have been discussing this evening, these inequities become even more intolerable. I should like to hear from the Minister that these aspects will be examined.
11.9 p.m.
Mrs. Jill Knight: What concerned me most about the Under-Secretary's speech introducing the order was its almost self-congratulatory note and the suggestion implicit in it that the order and all that it implies was enough—[Interruption.]—I wonder whether I may ask you, Mr. Deputy Speaker, to protect me from the interventions of the hon Member for Ealing, North (Mr. Molloy).
The Government must be told in no uncertain manner that what they are proposing in these orders is not sufficient to meet the plight in which many elderly and needy people find themselves today.
I am particularly concerned with the plight that faces elderly people who have tried hard to provide for themselves—people who are not wealthy but who patiently, carefully and thriftily, all through their working lives, have put a little money aside and perhaps bought a share or two here and there. What about those who put their money into British Leyland? How greatly they have been cheated. The same applies to those who put money into Massey Ferguson. There are many such instances. These are not the kind of people who ought to be cheated or insulted. They ought to be congratulated, because they have tried to protect themselves and provide for themselves.
What is happening today is totally cheating them. Some have put their little bit of money into property, and because of that they are almost universally regarded by the Labour Government as wearing horns and a tail. Those who have put their money into property have not only been cheated; they have been treated monstrously by the various Acts which have gone through the House under this Government.
It is a damned sight easier to get rid of a husband than it is to get rid of a tenant. Tenants can treat their landlords

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abysmally. They can withhold rent and remain in the property for months. I have two old-age pensioners in my constituency who had a tenant in a flat of theirs. These are not wealthy; they are simply people who have tried to provide for themselves. They have found that due to the present legislation it has been impossible for them to turn out the tenant who not only failed to pay rent for many months but grew hashish in the garden and did other things which were totally unsatisfactory. These people, who tried to provide for themselves by rent from their property, have been cheated.
There are other elderly people who, throughout their working life, have tried to provide for their dependants. I have in mind a case in my constituency of two elderly people who tried to provide for their mentally handicapped daughter. They left what they thought at the time was sufficient money to care for this woman, who is now in her fifties and will never be able to support herself. The money they left has turned out to be nowhere near enough. The mentally handicapped woman herself not only has no resources, except what her parents left her; she has been denied such things as attendance allowances, or any help at all. Elderly people today cannot be compensated for the effects of inflation simply by the orders before the House this evening. Some of them are desperately worried about the rates burdens they have to bear—as, indeed, we all do. Others have been hit in different ways. For instance, the Government have imposed a luxury VAT rate on such things as electric blankets. Elderly people rely on these things, and it is not enough to give them a bit to cover some of the effects of inflation and then to hit them in these other ways and imagine that that is equitable for these poor people.
My hon. Friend the Member for Wallasey (Mrs. Chalker) mentioned telephones, as also did the hon. Member for Ealing, North (Mr. Molloy). I wonder whether the Minister has tried to get a free or assisted telephone for any of his constituents. I have. It is almost impossible to get telephones for these elderly people. It is quite true, as my hon. Friend the
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Member for Wallasey said, that people are now having telephones removed.
The message from the Conservative Party to the Minister tonight is that these orders are not enough. The Government must realise that the mere giving out of more money, much as we all welcome it, is not enough to meet the terrible conditions in which many elderly people find themselves today.
11.15 p.m.
Mr. Robert Boscawen: It is quite like old times to hear the Under-Secretary, with his agile mind, reeling out vast lists of figures on social security. I have no doubt that they will read extremely well in the Official Report, but those of us who have not the same quick and ready thinking as the hon. Gentleman were not able to absorb all that he said.
One feature of the hon. Gentleman's speech which I was able to absorb was that what he is doing tonight is purely a reflection of the failure of our society. We are spending £1,000 million to enable pensioners to stay where they are, and many of them will not even be able to do that. We are not even improving and extending pensions and filling in some of the gaps. My hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight) spoke of the need for a death grant for those who do not get one. I have been pressing the need for this for some time, as did the Under-Secretary when he was in opposition. But he cannot do it now, because of our total failure to come to grips with the real menace facing us today. The Government have to give the lead. Unless we come to grips with inflation, the people whom we are discussing this evening will suffer most.
Let us look at some of the items in the average person's budget for which the general movement of prices does not cater. The increase in postal rates will probably have a greater effect on pensioners than anyone else, and the rates are likely to be increased still further. Many pensioners cannot get out to pay their bills, and have to do so by post. For many of them, the post is their only means of communication with families and friends.
Then there is the gross and substantial reduction in bus services in country areas,

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and we see increases in fares on what few services remain. Pensioners will be more affected than anyone else. Social security offices are being curtailed in number. In my constituency, many local offices can no longer be reached by telephone, because of staff shortages. They have to be visited. It may be that some pensioners cannot get there themselves and have to rely on friends to go on their behalf.
These are some of the effects of inflation on ordinary people in retirement, who are hit harder than those fortunate enough to be active and young. But the real failure is that we are not making any improvement by means of this order. There is no extension of the non-contributory pension or of the earnings disregards for the non-contributory invalidity pension. There is no improvement in the maternity grant or in the death grant.
The order is a confession of failure. If the Under-Secretary had been sitting on the Opposition benches, he would have condemned the Government, and rightly, for having allowed the terrible scourge of inflation to get out of hand and to hit elderly and disabled people harder than anyone else.
11.19 p.m.
Sir Brandon Rhys Williams: There is much that I would have liked to say about this important and costly pair of orders, but in the minute or so that I have available I want only to refer to the date of the coming into operation of the benefits. Here we are, on Midsummer Day, and these benefits will not come into effect until 17th November. Candidly, we cannot go on with the obsolete methods which the loyal and hardworking staff of the Department are asked to put into practice.
Machines are available which would make it possible to carry out changes of this kind in a few days. How much longer will Ministers be content to carry on with the caterpillar programme of reform of the administrative procedures of the Department? It is only seven months since the last increase and it will take us five months to bring in this one. Let us suppose that the rate of inflation continued to go ahead at the rate it moved in May. We should then have to introduce upratings faster than this, or we
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should have the entire pensioner and national insurance population dropping into penury—and the machine would collapse.
This is something to which we shall have to return. My suggestion is that we should immediately institute an inquiry into the administrative methods of the Department of Health and Social Security. I am not criticising the people who work the out-of-date system; I am criticising the Ministers who do not hasten ahead to introduce better methods and better machines. If it is not clear to the Minister that something has to be done at once it very soon will be. A public inquiry is required.
11.22 p.m.
Mr. Kenneth Clarke: The debate has included several references to our personal pleasure in welcoming the Under-Secretary back to his old job and to taking part in uprating debates. I assure him, on behalf of most hon. Members, I am sure, that we do not regard his return as being the equivalent of being sent to Siberia, even if some of the comments made at the time of the change suggested that that was so.
The Under-Secretary's speech included a staccato-like uttering of figures which was reminiscent of tape coming out of a computer. When he reached the political conclusion of his speech he took great pride in the large sums of money involved in the current uprating.
It is significant that, as usual in debates on pensions and benefits, considerably more Conservative Members than Labour Members have taken part.
Mr. Cyril Smith: All seven of them.
Mr. Clarke: It is interesting to hear the hon. Member for Rochdale (Mr. Smith) making the first comments in a pensions and benefits debate that I can recall in the comparatively short period he has been in this House.
Mr. Cyril Smith: It may be of interest to the hon. Gentleman to know that I took part in the last debate on pensions and I also took part in the debate on the £10 bonus for pensioners last Christmas. This is by no means the first such debate that I have attended. I am grateful to the hon. Member for giving me the opportunity to point out, particularly since our

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debates are recorded, that the great concern of the Conservative Party tonight is reflected in the fact that there have been seven Conservative Members sitting in this Chamber throughout the whole debate.
Mr. Clarke: I took part in both debates to which the hon. Member refers. I am sure that his contributions were exceedingly memorable, but they have escaped my recollection. I suspect that the fact that the proceedings are being recorded may be the reason for his intervention.
The Minister's political pride in the financial expenditure involved in these measures and the percentage increases they contain was somewhat dented by the debate because the background to what is being done is that there has been a substantial cut in the living standards of those dependent on pensions and benefits and a failure, even using the mechanisms of uprating, to keep up the living standards of the poor in the type of tearaway inflation we are now suffering.
The Under-Secretary was kind enough to say that the machinery of uprating we are using was introduced by the Conservative Government in their 1973 Act, when the legislative commitment was made which bound future Governments to index-link a substantial number of pensions and benefits on a regular annual basis. Since then we have been committed to six-monthly reviews and in practice the Government have got very much nearer to that. In the present inflationary climate it is a good thing that we are doing this to give some protection against the hurricane striking the beneficiaries of these benefits. Before we look at the benefits that have been increased we have to remember that although the Government have taken over the obligation of regular reviews and are making much more speed than they are obliged to do, they are trying to prevent the introduction of any new benefits into the up-rating and index-linking machinery.
What the Under-Secretary said this evening contrasts considerably with the Government resistance to bringing the new child benefit into this uprating procedure, and the resistance which the Government successfully maintained recently in Parliament against including the mobi-
400
lity allowance in the new uprating procedure. We tried to demonstrate that this procedure did not adequately defend the real value of pensions and benefits. We realise how empty and heart-on-sleeve must be the declarations of the Government on other subjects when they decline even to include child benefit or the mobility allowance in any regular uprating procedure.
My hon. Friend the Member for Sutton Coldfield (Mr. Fowler) dealt with our commitment to six-monthly reviews. I await the Under-Secretary's explanation of the reason why the Government are still against the policy of six-monthly reviews, as the review periods are becoming shorter and a seven-month review was announced this evening.
On the last occasion when the matter was discussed the problem of administrative details was raised by the Minister. It was explained that 2,000 more staff would have to be recruited to surmount the great administrative problems of making these reviews every six months. Since this is to be a seven-months' review, I should like to know how many of the 2,000 additional staff have been engaged. How are the officers of the Department coping with the administrative difficulties laid upon them, if what the Secretary of State said recently is to be believed?
In his memoirs about his last period in office the Prime Minister claimed that administrative problems prevented the speeding up of the pensions review when he first took office. That statement was contradicted by his ex-colleagues in their memoirs and posthumous recollections in newspapers. The Opposition are doubtful about the administrative problems mentioned by the Government.
As the flames of inflation leap higher, the regular review procedure, which is based on the historic review procedure, is not protecting the living standards of the beneficiaries. The hon. Member for Truro (Mr. Penhaligon) was correct when he said that as long as there are historic reviews based on past rates of inflation, as inflation quickens we cannot adequately protect the beneficiaries. The review is based on inflation during the period from August 1974 to March 1975, but the benefits are not payable until November 1975 onwards. During this

401
period inflation was 26 per cent. in earnings and 23 per cent. in prices. As inflation is now higher, the real value of these benefits, when paid, will be substantially lower than the Minister indicated.
We must know whether, in the coming winter, pensioners will live on the basis of last year's level of inflation, and how long they will live on this latest uprating from November. The last time there was an uprating the Government announced when the next would occur. Will the Under-Secretary do so this evening? For how long will the new levels be paid after November 1975? On the Opposition commitment of six-monthly reviews, they would be paid until May 1976. I suspect that the Government will eventually accept the Conservative proposal.
When we compare the historic figures from August 1974 to March 1975, employing the basis used by the Chancellor in October 1974, we see that the current figure for inflation is about 35 per cent. The value of the increases will therefore be eroded. The reply to a Parliamentary Question yesterday disclosed that the figure for inflation was 35 per cent. However, the real value of the pension now paid will, as a result of the April uprating, be reduced from September 1975 onwards. The new pension will lose its real value in relation to the existing pensions levels if that rate is maintained.
The other problem in comparing rates of inflation with level of benefits is that the figures ignore the effect of the tax thresholds which the Government have not raised in line with inflation. That affects wage earners as well, and it has an adverse effect on the living standards of those with the lowest incomes. My hon. Friend the Member for Bromsgrove and Redditch (Mr. Miller) was right to remind us that out of these benefits many widows and pensioners have to pay a higher level of tax than they have experienced in the past.
If the combined effect is that by November 1975 the real value of the benefits will be substantially down, the abandonment of the Christmas bonus will cause great resentment to a large number of people. We accept that there always has been a case for saying that the Christmas bonus is not a satisfactory permanent feature of the national insurance system,
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but the Government should not underrate the rage which will be experienced by pensioners when that bonus is not given.
Mr. Molloy rose——
Mr. Clarke: I cannot give way. The hon. Member will take the Minister's time if I give way, and he has already made the longest speech in the debate from the back benches.
The Minister mentioned the introduction of a non-contributory invalidity pension at the new rate. He did not mention that, contrary to the wishes of a Standing Committee of the House, disabled housewives will not get any new benefit in November. The Government are obdurately sticking to their decision to bring them in two years later.
I shall touch on supplementary benefits and the rules under which they are paid. Will the Minister give an assurance that the needs allowance for rent and rate rebates will be raised by the Department of the Environment at the same time and with effect from the same date as the increase in supplementary benefits? There was considerable difficulty in a recent uprating when a gap was allowed to ensue so that people who received more supplementary benefit lost part of their rent and rate rebates until the needs allowances were raised.
Will the Minister confirm that the Supplementary Benefits Commission will liberalise its rules about the direct payment of rent? I understand that the SBC has been changing its procedure. There is a huge and rising level of council house rent arrears, which means that part of the uprating will be used for that purpose instead of for keeping up the level of benefits. I trust that the SBC will pay more rents directly.
That brings me on to the fixed rent addition for the non-householder. A supplementary pensioner or beneficiary who lives in someone else's household gets a 95p notional addition for rent. That has been raised only to £1 by this uprating, and that increase is not in line with any of the other increases. Will the Minister confirm that the Government have decided to make a substantial cut in the real value of the supplementary benefit paid to non-householders?
Finally, I come to disregards on supplementary benefits, which are not to be

403
payable until November of this year. The Minister can take no pride in saying that they will come into effect, because the disregards were legislated for 12 months ago. There has been a year's delay between the passing of the necessary legislation and the disregards coming into effect, presumably at the level fixed 12 months ago. So the value of the disregards will be very much less.
Disregards are particularly important to one-parent families living on supplementary benefit. That is a group which the whole House want to help—a group which the Government refused to help in the Child Benefit Bill. By refusing disregards for so long and not increasing them when they come into effect in November are damaging the position of one-parent families.
I have left the Minister with some questions, and many other hon. Members have asked questions. I hope he will be a chastened man when he rises to reply and that he will not follow the pattern of his right hon. Friend the Secretary of State, who constantly comes to the House, heart on sleeve, to make speeches expressing pride in her little packages of compassion, which have the effect of cutting the living standards of the people about whom she is talking.
The poor are getting poorer under the right hon. Lady. They are getting poorer mainly because of the Government's total failure to deal with inflation. We have seen the collapse of the social contract and the surrender to those who have obtained excessive wage settlements in industry. They are the people who are gaining the advantage that is being denied to pensioners and beneficiaries. That is the background and that is the sad context of this order.
11.35 p.m.
Mr. Meacher: I have five minutes and I shall try to answer as best I can the main points that have been raised. First, the debate has rightly centred around inflation and the measures that are needed to surmount it and to prevent the need for constantly returning to the House for further upratings. That point has been made by the hon. Member for Birmingham, Edgbaston (Mrs. Knight) and my hon. Friend the Member for Ealing, North (Mr. Molloy). That is an
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entirely appropriate point to make. The House will know that the Government are determined to take further measures to seek to slow down the rate of inflation, which we regard as pivotal. We do not accept that it is sufficient merely to pay out more money, but the point I wish to deal with is the question whether we are taking account of the situation with which my Department is faced and whether we are adequately inflation-proofing the situation of pensioners.
The hon. Member for Sutton Coldfield (Mr. Fowler) has misconceived the central question of inflation-proofing. He indicated that real cuts were planned. His hon. Friend the Member for Rushcliffe (Mr. Clarke) talked about the poor becoming poorer. We have taken the best available estimate of the future rate of inflation. The rate that the Opposition Front Bench has taken of 35 per cent. is based on the quarterly period from February to April and grossed up for the year. That is not, by and large, the best estimate that can be made. We believe that the estimate that we have made on an historic basis is the best. But even if the Opposition are right, it is the fact that if inflation accelerates as the hon. Member for Rushcliffe assumes there may be some small shortfall until we reach the peak. Given a downturn in the rate of inflation, the historic basis for inflation-proofing would mean a corresponding gain in real terms for pensioners. I do not believe that there is a better way of proceeding.
The other main point that the hon. Gentleman raised concerned the frequency of the upratings. The hon. Gentleman will have observed that the Government have taken account of their commitment to protect pensioners by introducing upratings at increasingly more frequent intervals. First it was 10 months, then it was eight and a half months, and now it is seven months. The hon. Gentleman asks for six months. I do not think that there is a great deal of difference between us on that. The important point is that the Government should operate upratings whenever necessary. That is the answer to the hon. Gentleman on child benefits. He knows that we have committed ourselves to do that. It is what successive Governments have done in respect of supplementary benefit and family income supplement.

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The Government have committed themselves to protect beneficiaries as and when necessary. That is what we are proposing.
Further, the Conservative Party's six months' proposal has never been more than to provide mere price protection. We are concerned that protection, either in terms of earnings or prices, should be based on whatever acts more in the interests of the beneficiaries.
The third point I make to the Opposition Front Bench is that it has perhaps underestimated the extent to which we have protected pensioners. Perhaps the best comparative index for considering the situation of pensioners is in terms of the average net earnings of male manual workers. If we make that comparison we find that in October 1973 the single pension amounted to 26·1 per cent. of the net earnings of male manual workers. In July, 1974, after our first uprating, it was 29·6 per cent., a significant increase in relative terms. In April 1975 it was 31·4 per cent. That is a significant and important improvement in relative terms for pensioners.
The hon. Member for Truro (Mr. Penhaligon) made one particular point, to which I respond, concerning the abolition of the Christmas bonus. We recognise that when the bonus was first introduced it had arbitrary coverage. We attempted to improve the situation by bringing in an extra million persons, including widows and the chronically sick and disabled, but many did not have another qualifying benefit. We believe that the bonus is not the appropriate way to assist the pensioner. That is why we are bringing forward the second general uprating planned for December to the week beginning 17th November, which was the week in which the bonus would have been paid.
The hon. Lady Member for Wallasey (Mrs. Chalker) referred to dietary additions. I must tell her that they are standard additions, determined by medical advice. They are not absolute limits. If further assistance is necessary, special consideration will be given. She also asked why the Department had made a decision not to issue new order books——
It being one and a half hours after the commencement of proceedings on the motion, Mr. DEPUTY SPEAKER put the
Question, pursuant to Standing Order No. 3 (Exempted business).
Question agreed to.
Resolved,
That the Social Security Benefits Up-rating Order 1975, a draft of which was laid before this House on 11th June, be approved.
Resolved,
That the Supplementary Benefit (Determination of Requirements) (No. 2) Regulations 1975, a draft of which was laid before this House on 11th June, be approved.—[Mr. Meacher.]

WEALTH TAX
Ordered,
That Mr. Denzil Davies and Mr. Robert Kilroy-Silk be discharged from the Select Committee on a Wealth Tax and that Mr. Neville Sandelson and Mr. Roderick MacFarquhar be added to the Committee.—[Mr. Walter Harrison.]

PETITION

  Direct Grant Schools
  11.42 p.m.
  Sir George Sinclair: With your permission, Mr. Deputy Speaker, and that of the House, I have the honour to present a petition on behalf of the direct grant schools.
  These schools have served the cause of education well for many years, in particular by preserving and encouraging high standards of learning and conduct by educating children from a wide variety of backgrounds, including the children of parents of moderate means, and by helping them to develop a strong sense of duty and service to the community.
  The petition is a symbol of the protest of the 4,000 people who came today from all parts of the country to lobby hon. Members, and the 500,000 signatures collected in under three weeks of the parents and many other supporters of the direct grant schools. The support behind this protest is many times this figure.
  Wherefore your Petitioners pray that the decision to phase out the direct grant from September 1976 should be reversed and that there will be a decision to retain and to improve the system.
  And your Petitioners, as in duty bound, will ever pray.
  I beg leave to present the petition.
  To lie upon the Table.

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

  PEACEHAVEN (RECREATIONAL FACILITIES)
  11.43 p.m.
  Mr. Tim Rathbone: I apologise for detaining you, Mr. Deputy Speaker, the Minister and the House at this late hour, but the problem which we are about to debate has been a subject of concern for the people living in Peacehaven for a quarter of a century.
  In order properly to understand the problem, it is necessary first for the House to appreciate some of the background details to the town of Peacehaven. It was founded in 1919 as a "garden city by the sea" by a Mr. Charles Neville, an entrepreneurial promoter who sold off plots often through national newspaper competitions, and in so doing created a planner's nightmare. This may be at the root of the difficulties we are debating tonight.
  That same Mr. Neville, however, was very much aware of the area's spiritual and social needs, and during 1920 established churches, launched literary, dramatic, horticultural and other societies and formed sports clubs—most particularly giving the land for and founding the Peacehaven Football Club in 1922. This same club is using that same pitch today.
  The town of Peacehaven continued to grow right up to 1939, when all remaining vacant land was taken over by the War Agricultural Executive Committee and most of it put under cultivation. In 1952 a large area of this land was compulsorily purchased by the Ministry of Agriculture and Fisheries and let off to a local farmer. But it must be noted that during the whole of this period from 1919 onwards the area of land given for recreational purposes by Mr. Neville has remained intact, being used by the football club and Her Majesty's Forces during the war for various sports while the surrounding land was ploughed up.
  In about 1955 the Peacehaven Parish Council applied for planning permission to use 10 acres of land, including the
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  three-acre playing field, as a recreation ground. Planning permission was granted in 1957 following a public local enquiry. Since that time there have been various attempts by the council to purchase this recreational area.
  During 1960 the parish council had talks with the football club regarding fencing this land, and it was at this point in time that the Ministry claimed and, it seems, established, its ownership. This ownership has always been disputed by some inhabitants, who still maintain that the land belongs to the parish.
  Be that as it may, however, in 1964 the Ministry offered to negotiate with the parish council for a formal tenancy. The council at first resisted the proposal on the ground that the Ministry could not give vacant possession as the sports ground was occupied by the sports association, which might have established a possessory title. After further correspondence, however, this line was not pursued and further negotiations resulted in heads of terms for a lease being agreed in May 1967. It transpired that this offer was not accepted by the parish council as it was advised then to try to purchase the land.
  At the same time, the council, approaching this problem from another angle, registered the three acres of land in Piddinghoe Avenue under the Commons Registration Act 1965 as a village green. However, the situation became somewhat confused when, following East Sussex County Council's approach to the Ministry on behalf of the parish council for purchase of the 10-acre site—an approach to which the Ministry signified general agreement subject only to agreement of heads of terms—the Ministry decided that disposal of the site either by sale or lease could not proceed until the question of the village green registration had been cleared up. The Ministry led the council to believe that if the commons registration application was withdrawn, it would be prepared to sell the land. It was after this statement that the parish council, with great reluctance and against the wishes of some inhabitants, withdrew the registration. In doing so the council was considerably criticised even though it was at the same time under considerable pressure from parishioners to acquire the land.

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  Unfortunately, following withdrawal of the commons registration application, the council was told in 1974 that the Ministry was not willing to sell the land. It was at this time that the parish council sought the advice of the Lewes and District Sports Advisory Council, which has now been taking up this matter on its behalf.
  At this time also the County Council Education Committee also pressed an interest in securing the use of part of the site for playing fields for a new primary school which was planned to be built nearby. The Ministry accepted that the parish council would be agreeable to such shared use. It must be noted, however, that even with its agreement and even though the policy of the East Sussex County Council is that full use be made by the community of present school recreational playing fields, these options are not easily exercisable in Peacehaven because the combined effect of multiple use and of sea spume leads only too often to rapid deterioration of grass and decay of the sports fields and surrounding ground.
  That is the situation as it now exists. When the Peacehaven Football Club was first founded in 1922 the population of the town was 1,924. This rose to approximately 4,000 by 1939, and during this period the development company of the town provided not only the sports field which I have mentioned, but two bowling greens, several tennis courts and a formal Italian garden for band shows, dances and the like.
  In 1934 a local schoolmaster and a local sports association laid a cricket table adjacent to the football pitch, and this was used until it was ploughed up—without compensation—during the war. Now all but the football pitch have gone and nothing has taken the place of what is missing. The present population of Peacehaven is approximately 11,000 and the only recreational area there now is just over 4½ acres off Piddinghoe Avenue and a public open space of about 5 acres near the South Coast Road, this latter being maintained by the parish council although it is owned by the Lewes District Council. It is interesting to note that the Town Map 1965 for Seaford, Newhaven, Peacehaven and Telscombe, which has been approved by the Secretary of State, designated that 10½ acres of land
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  should be made available for recreational purposes. I quote from the written analysis:
  "Paragraph 307 Peacehaven-Telscombe Cliffs. At the time of survey there were only 3·42 acres of playing fields, a provision of 0·65 acres per 1,000 population. A demand for further facilities had existed for a number of years and the Peacehaven Parish Council have planning permission for an extension to the existing playing fields, but as yet have been unable to obtain possession."
  Paragraph 308 goes on
  "Assuming that the 10·4 acres covered by the consent (which includes the existing playing field of 3·42 acres) represents the demand at the time of survey, then provision for a further 40 acres should be made by 1981 as a result of an estimated increase of from 456 to 2,214 (or 386 per cent.) in the number of males in the 15–34 age groups. The total calculated increase is therefore 46·98 acres."
  As the Minister will know, the national average for recreational space is four acres per 1,000 head of the population. On this basis, Peacehaven should have 44 acres now, but on the basis of the 1973 Town Map and Plan for Peacehaven and Telscombe Cliffs, which projects a population increase of 17,500 by 1981, 26 additional acres should be added between now and then. To look at it another way, since the township is now included as a growth area in the East Sussex County Council's 1975 structure plan, which projects a population of over 20,000 in 1981, Peacehaven and Telscombe Cliffs will require 80 acres of recreation space in the next six years, or eight times the area we are discussing this evening.
  It is appropriate at this point to mention a parallel need for public open space in Telscombe Cliffs. There it has been agreed between the town council and the Lewes District Council that open space could be provided in the area known as Chatsworth Park, which forms part of Kirby Farm in that town. The town council seeks a lease or possibly a purchase of a five-acre plot of land south of Bridleway 16 for this amenity area and the Lewes District Council acting on its behalf sought and gained reassurance from the divisional surveyor of the Ministry of Agriculture, Fisheries and Food that such a request would be favourably received. Talks with the Ministry are, I believe, proceeding at this time with this lease or purchase in mind.
  It may be interesting for the Minister to know that the search for recreational

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  areas is not just a quirk of the town councils in the area. Concern about the subject was found to be widely based in a survey carried out by two second-year students from the University of Sussex, under the guidance of the University Socio-Educational Research Fellow in August 1969. I should like to cite just four of the findings from this survey.
  First, it is pertinent that 52 per cent. reported an interest in soccer, cricket or athletics, and more than a tenth of them actually practised one of those sports. This is all the more remarkable in light of the fact that half of the sample interviewed were female, and therefore unlikely to practice either soccer or cricket, and half of the men interviewed were over 50, and unlikely to practise soccer or athletics. Second, the most needed sporting facility in Peacehaven was felt to be a combination of cricket pitch, playing fields and athletic ground. Thirdly, the most needed recreation facility was felt to be a recreation ground or park, scoring greater interest than either a community centre or a combination cinema-theatre. Fourthly, it may be surprising for the House to hear that sports and recreation facility needs were more often mentioned in the survey than a desire for road improvements, bus services and shelters, or even cliff-top or under-cliff walks, all of which have received considerable publicity and attention in recent years. These are measures of the community's concern about the subject of the debate.
  In addition, the town council now has local sports clubs in contact with it requesting additional facilities and even offering to help finance and arrange voluntary labour to provide better facilities in the parish. At present the council is unable to supply the land, so that this latent community spirit and vigour cannot be tapped or fostered.
  The origins and development of Peacehaven are unique, in that all the land is owned either in small building plots or in large parcels of land acquired compulsorily by the Ministry of Agriculture—including the recreational area we are discussing. There is in Peace-haven an enthusiastic body of citizens who, together with the parish council, are desperately trying to acquire the four acres which presently include the foot-
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  ball pitch together with seven acres of adjoining land.
  Negotiations with the Ministry of Agriculture have been going on for 20 years. It appears that, following Ministry agreement to sell, it has changed its mind more than once. The parish council considers that the Ministry has some obligation to sell as a quid pro quo for withdrawal of commons registration application.
  In view of the vast acreage of land owned by the Ministry in Peacehaven, most of which cost virtually nothing to acquire, it is likely that considerable acreage falls in proposed development areas, and the Ministry can expect top land values to be returned to it eventually for this acreage. It therefore does not appear to be too much to ask for the 10½ acres of land in Piddinghoe Avenue to be sold to the parish council at present use price, so that it in turn can provide a better environment for all those living and holidaying in the community. It is appropriate to mention on this point that the East Sussex County Council has certified alternative uses to be either private open space or private sports or playing fields. This also should have an influence on the price.
  Lack of successful conclusion to this problem makes nonsense of stated Government policy relating to recreation and playing field facilities and of the efforts of the Lewes and District Sports Advisory Council to improve these facilities in the area.
  The situation also flies in the face of the guidelines established by the National Playing Fields Association for a minimum of three acres per 1,000 population, or the national average of four acres of recreational space per 1,000 population. The situation will be further exacerbated by the planned development of Peacehaven and Telscombe Cliffs under the Town Centre Map and Action Plan 1973 and under the East Sussex County Council County Structure Plan of 1975.
  It is in the light of these factors and the established desire by this community for sufficient recreational facilities and security of tenure of them that I ask for help from the Minister this evening.
  12 midnight.
  The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Gavin Strang): I am glad of

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  the opportunity to deal with this matter, which is obviously important to the people of Peacehaven and I think the hon. Member for Lewes (Mr. Rathbone) knows that I am anxious to be as helpful as I can. It will not be necessary for me to speak at any length on a number of the points he has raised.
  The sports ground to which the hon. Member has referred is an area of 2·9 acres formerly owned by the Saltdean Estate Company and forming an island site within Lower Hoddern Farm. The farm, enclosing the sports ground area, was requisitioned by the Ministry during the Second World War for food production and was subsequently compulsorily acquired from a large number of owners of small plots in order to keep it in agricultural use. The farm is let on an annual agricultural tenancy.
  The sports ground, owned by the Minister, is understood to be occupied by the Peacehaven Sports Association, which has been using the area since about 1925, when it was paying the Saltdean Estate Company, the then owners, an acknowledgement of 2s. per match. Since the land was requisitioned, no rent has been demanded from or paid by the association, which has, nevertheless, continued to occupy the land. The sports ground is now surrounded by a boundary fence erected by the parish council in 1967 with the Ministry's knowledge. Repeated attempts have been made to negotiate a formal letting to regularise the position of all parties, but so far these have failed.
  The hon. Member has gone over the history of the negotiations at some length and it will not be necessary for me to repeat what has taken place over the years, in relation to the parish council's efforts to secure ownership.
  It may be useful, however, for me to comment on the position as it has developed from 1974 when, in September, the divisional surveyor, as the hon. Member said, wrote to the parish council, since when no reply has been received from the parish council.
  It is also worth mentioning that in the background note I sent to the hon. Gentleman in December 1974—a note which he found helpful—we said that it is not clear to the Ministry whether the parish council is still interested in purchasing. However that may be, the
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  Ministry is able to open negotiations with the parish council for a lease of the sports ground with a view to meeting its immediate needs.
  As I understand it, we have not yet had any response from the parish council to that letter in September.
  We are more than sympathetic to the points the hon. Gentleman has made on behalf of his constituents. I note with interest his arguments that there will be an increased need for open space if a projected increase in the population of the area materialises. He is familiar with the position that in the approved town map, the existing sports ground forms part of a larger area of 11 acres now zoned as public open space and surrounded in the main by "white" land, where existing agricultural use is expected to remain undisturbed.
  There is, however, a reasonable expectation that much of the surrounding land would be required for further residential development in the not too distant future and the public open space area would therefore have considerable "hope" value if sold at the present time. It is not clear to the Ministry whether the parish council is still interested in purchasing the land. However that may be, the Ministry has offered to open negotiations with the parish council for a lease of the sports ground with a view to meeting its immediate needs.
  If the parish council were to come forward immediately and say that it would like to purchase this piece of land, that, in the nature of things, would take rather longer than the hon. Gentleman and I would like. The parish council may like to consider taking up the option of an immediate lease, which, hopefully, would not run very long before it secured ownership of the land.
  The hon. Gentleman indicated that in his view the value of the land might not be as great as some people have suggested, particularly in the light of the position which he described regarding the statement that this land should be used for open space. However, I am sure that he appreciates that the Minister is bound to have some regard to the valuation provided by the district valuer and that, with the best will in the world, the price eventually to be paid for the land will have to reflect the district valuer's assessment of the value.

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  It may be helpful if I indicate that it would not be right for me to make public before any agreement has been reached the precise terms of the lease that we have offered. It should be sufficient to say that the terms are based on the agreement of May 1967. It would be in order for the parish council to make public—I do not think that it has done so, but perhaps the hon. Gentleman will correct me if I am wrong—the terms on which the Ministry are prepared to lease the land, and that offer still stands.
  As I have indicated, we are prepared to discuss the possibility of the purchase of the land. It is certainly not for want of any willingness to negotiate on the Ministry's part that this matter has effectively stood still since last September. We are ready to give effect to our offer as soon as we know that it has been taken up by the parish council.
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  The hon. Gentleman is really pushing against an open door. We are still prepared to sell the lands. Alternatively, we are prepared to reopen negotiations to lease the land. For the present, because of the proposal made public in the county structure plan for the development of Lower Hodden Farm, the Ministry sees the parish council's immediate need as being met, without prejudice to subsequent disposal, by a lease, as I have indicated. I can only emphasise that we are anxious to be as helpful as possible. The most important thing that the hon. Gentleman can now do is to use his influence with the parish council to see that it comes forward promptly in repsonse to the letter and states clearly whether it is interested in the lease or only in the purchase or whatever.
  Question put and agreed to.
  Adjourned accordingly at eight minutes past Twelve o'clock.

  CIVIL PROCEEDINGS
  CIVIL PROCEEDINGS
  LAND (BONA VACANTIA CLAIMS)
  LAND (BONA VACANTIA CLAIMS)
  PRIME MINISTER (VISITS)
  PRIME MINISTER (VISITS)
  PRIME MINISTER (ENGAGEMENTS)
  PRIME MINISTER (ENGAGEMENTS)
  ECONOMIC AFFAIRS (CHANCELLOR'S SPEECH)
  ECONOMIC AFFAIRS (CHANCELLOR'S SPEECH)
  CHURCH LEADERS (MEETING)
  CHURCH LEADERS (MEETING)
  SOCIAL CONTRACT
  SOCIAL CONTRACT
  NATIONAL ECONOMIC DEVELOPMENT COUNCIL
  NATIONAL ECONOMIC DEVELOPMENT COUNCIL
  SECRETARY OF STATE FOR THE ENVIRONMENT (SPEECH)
  SECRETARY OF STATE FOR THE ENVIRONMENT (SPEECH)
  EUROPEAN COMMUNITY
  EUROPEAN COMMUNITY
  NETHERLANDS PRIME MINISTER
  NETHERLANDS PRIME MINISTER
  POULSON CASE
  POULSON CASE
  COMMODITY MARKETING
  COMMODITY MARKETING
  TUC AND CBI (MEETINGS)
  TUC AND CBI (MEETINGS)
  PRESIDENT AMIN
  PRESIDENT AMIN
  SCOTLAND
  SCOTLAND
AGRICULTURE, FISHERIES AND FOOD
  Swill
  Swill
  Whale and Shark Fishers
  Whale and Shark Fishers
  Whales, Dolphins and Sharks
  Whales, Dolphins and Sharks
  Icelandic Fishing Limits
  Icelandic Fishing Limits
  Venison
  Venison
DEFENCE
  Land (South-West England)
  Land (South-West England)
  Arms Sales
  Arms Sales
  Married Quarters and Hirings
  Married Quarters and Hirings
  Northern Ireland
  Northern Ireland
  Nuclear-powered Ships (Port Facilities)
  Nuclear-powered Ships (Port Facilities)
  HMS "Mauritius"
  HMS "Mauritius"
  Departmental Houses
  Departmental Houses
  Weapons (Standardisation)
  Weapons (Standardisation)
  South Africa
  South Africa
  British Army of the Rhine
  British Army of the Rhine
  Cyprus
  Cyprus
  Harrier Aircraft
  Harrier Aircraft
  Equipment Purchases
  Equipment Purchases
  NATO Defence Ministers
  NATO Defence Ministers
  Aircraft Industry Employees (Redeployment)
  Aircraft Industry Employees (Redeployment)
  Housing (Ex-Service Men)
  Housing (Ex-Service Men)
  Contracts (Placement)
  Contracts (Placement)
  Hong Kong
  Hong Kong
  Territorial Army
  Territorial Army
  USSR Naval Exercises
  USSR Naval Exercises
  Civilian Employment
  Civilian Employment
  Footwear (Service Personnel)
  Footwear (Service Personnel)
  Nuclear Planning Group
  Nuclear Planning Group
  Retired Pay (Vote Allocation)
  Retired Pay (Vote Allocation)
  Expenditure
  Expenditure
  Allied Command Europe
  Allied Command Europe
  Eurogroup (Concept Harmonisation)
  Eurogroup (Concept Harmonisation)
  Furnished Hirings (Rent)
  Furnished Hirings (Rent)
  Research
  Research
  CR Chemical
  CR Chemical
  RAF Andover
  RAF Andover
EMPLOYMENT
  Trade Union Elections
  Trade Union Elections
  Working Mothers
  Working Mothers
  Stable Lads' Dispute
  Stable Lads' Dispute
  Factory Inspectorate
  Factory Inspectorate
  Redundancy
  Redundancy
  Prices
  Prices
  Industrial Disputes
  Industrial Disputes
  Unemployed Persons
  Unemployed Persons
SOCIAL SERVICES
  Doctors (Appointment)
  Doctors (Appointment)
  Research
  Research
  School Nurses
  School Nurses
  Mental Hospitals
  Mental Hospitals
  Benefits (Able-bodied Young Persons)
  Benefits (Able-bodied Young Persons)
  Bronchitis and Emphysema
  Bronchitis and Emphysema
  Solvents (Inhalation)
  Solvents (Inhalation)
  National Insurance Contributions (Widows)
  National Insurance Contributions (Widows)
  Health Centres
  Health Centres
EDUCATION AND SCIENCE
  Graduates (Physical Handicaps)
  Graduates (Physical Handicaps)
  Medical School Places (Applications)
  Medical School Places (Applications)
  Open University
  Open University
  Universities (Equipment)
  Universities (Equipment)
  Secondary Education (Sussex)
  Secondary Education (Sussex)
NATIONAL FINANCE
  10p National Savings Stamp
  10p National Savings Stamp
  Customs and Excise
  Customs and Excise
  Coinage
  Coinage
  Benefits
  Benefits
  Mortgages
  Mortgages
  Treasury Minutes
  Treasury Minutes
SCOTLAND
  Venison
  Venison
  Scottish Aviation Limited
  Scottish Aviation Limited
  Rate Relief
  Rate Relief
  Waste Disposal (Dundee)
  Waste Disposal (Dundee)
  Rents
  Rents
  Taxis (Licensing)
  Taxis (Licensing)
  Pelican Crossings
  Pelican Crossings
  Power Station, Torness
  Power Station, Torness
  Rickets
  Rickets
  Barnton Roundabout, Edinburgh
  Barnton Roundabout, Edinburgh
  Community Programmes
  Community Programmes
HOME DEPARTMENT
  Television Council
  Television Council
  Prisoners' Correspondents
  Prisoners' Correspondents
  Prison Sentences (Appeals)
  Prison Sentences (Appeals)
  Prisons (Boards of Visitors)
  Prisons (Boards of Visitors)
  Drugs (Thefts)
  Drugs (Thefts)
  Crime Detection
  Crime Detection
  Wakefield Prison (Control Unit)
  Wakefield Prison (Control Unit)
  Deportation Orders
  Deportation Orders
  Referendum
  Referendum
  Horserace Betting Levy Board
  Horserace Betting Levy Board
  Betting, Gaming and Lotteries Act 1963
  Betting, Gaming and Lotteries Act 1963
  HM Prison, Long Lartin (Member's Visit Application)
  HM Prison, Long Lartin (Member's Visit Application)
  Welsh Language Television Channel
  Welsh Language Television Channel
WALES
  Agriculture
  Agriculture
  Water Supply Policy
  Water Supply Policy
  House Condition Survey
  House Condition Survey
ENVIRONMENT
  Planning Applications (Parish Councils)
  Planning Applications (Parish Councils)
  Harlow New Town
  Harlow New Town
  Cavity Walls (Insulation)
  Cavity Walls (Insulation)
  Planning
  Planning
  Geographers
  Geographers
  Development Costs (Professional Fees)
  Development Costs (Professional Fees)
  Hovercraft
  Hovercraft
  Property Improvement
  Property Improvement
  Water and Sewerage Charges
  Water and Sewerage Charges
  Offices (Development and Location)
  Offices (Development and Location)
  Motor Vehicles (Roof Construction)
  Motor Vehicles (Roof Construction)
  Local Authorities (Housing Revenue Accounts)
  Local Authorities (Housing Revenue Accounts)
  Whales Dolphins and Sharks
  Whales Dolphins and Sharks
ENERGY
  Pressure Tube Reactor
  Pressure Tube Reactor
  Offshore Oil Production (Scottish Trade Unions)
  Offshore Oil Production (Scottish Trade Unions)
  Offshore Oil and Gas (Operating Costs)
  Offshore Oil and Gas (Operating Costs)
  Power Stations
  Power Stations
FOREIGN AND COMMONWEALTH AFFAIRS
  Namibia
  Namibia
INDUSTRY
  Industrial Development Certificates
  Industrial Development Certificates
  Car Components Manufacturers
  Car Components Manufacturers
PRICES AND CONSUMER PROTECTION
  Inflation
  Inflation
  Polyurethane
  Polyurethane
TRADE
  British Caledonian Airways
  British Caledonian Airways
  Insurance Policies
  Insurance Policies
  "Compass Rose" (Loss)
  "Compass Rose" (Loss)
  North Sea Oilfields (Vessel Reporting Scheme)
  North Sea Oilfields (Vessel Reporting Scheme)
  Civil Aviation
  Civil Aviation
NORTHERN IRELAND
  Security
  Security
  Surgical Products
  Surgical Products
  Industrial Relations
  Industrial Relations
  Prisoners (Escapes)
  Prisoners (Escapes)

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

EEC AND PROPOSED CANADIAN AGREEMENT
The Earl of BESSBOROUGH: 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 progress has been made in drawing up a trade and co-operation agreement between the EEC and Canada and what Her Majesty's Government's attitude is towards it.
The PARLIAMENTARY UNDERSECRETARY of STATE, FOREIGN and COMMONWEALTH OFFICE (Lord Goronwy-Roberts): My Lords, Her Majesty's Government support the idea of closer links between Canada and the Community. The Council of Ministers is considering the question of an economic and commercial co-operation agreement between Canada and the EEC. Her Majesty's Government are contributing fully to discussions in the Community on the kind of arrangements that would be most useful.
The Earl of BESSBOROUGH: My Lords, while thanking the noble Lord for his Answer, may I ask him whether it is possible to give us a little more information about what is going on? Does he not agree that the proposed agreement, which I for one would greatly welcome, constitutes an important new principle in so far as it will be concluded with a developed country in the Commonwealth, as opposed to those countries needing aid which will be covered by the Lomé Agreements? Am I not also right in saying that this agreement might be somewhat similar to the agreement which the EEC have concluded with Mexico?
Lord GORONWY-ROBERTS: My Lords, to deal with the second point first, we are well aware of the truth of what the noble Earl has said as to the difference between developed and developing countries in this kind of negotiation. On the first point, I very much regret that because these negotiations are at the discussion stage, where drafts are considered rather than finalised, it is impossible to divulge what are essentially confidential negotiations. On the third point that the noble Earl made, it is much too early to say whether the Canadian agreement, if and when it emerges, will be analagous to the Mexican agreement. The text of the Mexican agreement has been agreed but not yet signed or published; it will be published in due course.
Lord LLOYD of KILGERRAN: My Lords, may I ask the noble Lord whether there is any difference between Her Majesty's Government and the French Government in their attitudes towards settlement of this arrangement with the Canadian Government?
Lord GORONWY-ROBERTS: My Lords, I think there is a substantial consensus of approach on this matter among all members of the EEC.
The Earl of SELKIRK: My Lords, can the noble Lord say whether a proposal has been made by the Commission to the Council?
Lord GORONWY-ROBERTS: My Lords, as I said, the stage at which these discussions are now is exploratory. This has not yet reached the Council of Ministers. I anticipate however, that as a result of discussions in the Council today there may be a decision to set up a working group to deal with the details.
Earl COWLEY: My Lords, while I accept the difficulty in which the noble Lord finds himself about giving details of the discussions, could he perhaps give the House some idea of the kind of products to be covered by the proposed Agreement?
Lord GORONWY-ROBERTS: My Lords, not the specific products. This is rather like discussing a Schedule to a Bill before it has been drafted. Both sides are aiming, of course, at a non-preferential co-operation arrangement between the Community and Canada. The Canadians

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have the perfectly legitimate aspiration of diversifying their external relations, as their Prime Minister made clear in a notable speech at the Guildhall in March. For our part, we in this country and the EEC as a whole would wish to do everything we can to assist them in that objective.

EEC ENERGY POLICY
2.35 p.m.
The Earl of BESSBOROUGH: 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 EEC Energy Council of Ministers have yet approved, or are likely soon to approve, the Commission's proposal for programmes of research and development action in the field of energy (COM(74)2150 Final) bearing in mind the report and resolution of the European Parliament adopted on 13th March 1975.
The MINISTER of STATE, DEPARTMENT of ENERGY (Lord Balogh): My Lords, the draft decision in this document will be considered by the Council of Ministers the day after tomorrow which will be attended by my right honourable friend the Secretary of State for Energy. I cannot therefore anticipate the conclusions of the Council.
The Earl of BESSBOROUGH: My Lords, I thank the noble Lord for that Answer. I am very glad that at last this matter is to be considered by the Council, because we in the European Parliament were pressed very much to give an opinion, in the hope that the Council would meet earlier. Now that the referendum is over, I hope the noble Lord agrees that the Government will come to a conclusion on this matter, and that the Council will he able to go ahead with their programme.
Lord BALOGH: My Lords, the Government have indicated that they intend to contribute to the formulation of the EEC common energy policy, at the same time ensuring that it is consistent with the national energy policy, as was also
1272
indicated by the noble Lord, Lord Carrington, for the previous Government. In this case the Government are not entirely satisfied that the review arrangements contained in the draft decision are adequate. This is one of the matters which my right honourable friend the Secretary of State will be discussing with his European colleagues the day after tomorrow.
The Earl of LAUDERDALE: My Lords, could the noble Lord tell the House whether his right honourable friend the Secretary of State, in approaching the Energy Council, will have in mind the Seventeenth Report of the House of Lords Select Committee which referred to this matter, and which drew particular attention to the absence from these proposals of a plan to investigate the resource availability of energy over the coming 25 to 30 years, and the time scale during which known resources are likely to be completely exhausted?
Lord BALOGH: My Lords, the noble Earl can be assured that the Government will always pay the most diligent attention to anything which comes from any Committee of the House of Lords, and will certainly use this contribution effectively in Brussels.
Lord BLYTON: My Lords, will my noble friend assure us that within the Treaty of Paris they will ensure that British interests in oil and coal—and we have twice as much coal as they have on the Continent—are safeguarded for the British people and not for the Continent?
Lord BALOGH: My Lords, we shall follow the best French example in safeguarding the interests of our own country.
Lord AVEBURY: My Lords, while the noble Lord obviously cannot make any detailed comment on the recommendations of this report prior to his right honourable friend expressing the Government's view the day after tomorrow, is there anything he can tell us about the Government's attitude to the recommendation that a 15 per cent. saving in energy consumption by 1985 should be the target, as compared with earlier forecasts? Also, can he say how this is to be monitored, bearing in mind the fact that the Department of Energy does not publish any forecasts going as far ahead as 1985?
Lord BALOGH: My Lords, forecasts in energy matters have been, and are, the burial ground of economic reputations, and I do not think that I wish to enter the stakes to go downwards.
The Earl of LAUDERDALE: My Lords, could the noble Lord assure the House that his right honourable friend, paying due attention to the very important Report by a very important Committee of this House, is particularly seized of the obscurity of these proposals in regard to both coal conversion and thermo-nuclear fusion? Furthermore, does he appreciate that there is a danger of overlapping operations between the EEC, the IEA, the International Atomic Energy Authority and the OECD, all of this being mentioned in the Report?
Lord BALOGH: My Lords, we are very grateful for this strengthening of our intellectual case.
The Earl of BESSBOROUGH: My Lords, would the noble Lord draw the attention of his right honourable friend to the importance of placing as much indirect action contract research in Member-States as possible, rather than perhaps spending more money in the joint research centres of the Community itself?
Lord BALOGH: Fortunately, my Lords, I can answer this question. It is proposed that all the work should be undertaken by indirect action; that is, by contracts placed directly by the Commission with Member-States' organisations, Government laboratories and private companies. Responsibility for implementing the programme will rest with the Commission, who will be assisted in their task by the Advisory Programme Management Committee, on which Member-States will be represented. Normally, the contracting organisation will be expected to match the Community's financial contribution.

AIRLINES AND PASSENGER OVER-BOOKING
2.40 p.m.
Baroness BURTON of COVENTRY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether, in view of the fact that Section 14(1) of the Trade Descriptions Act 1968 does not cover the over-booking of passengers by airlines, they will take steps to make the necessary amendment as soon as possible.
Lord JACQUES: My Lords, an Interdepartmental Committee under the chairmanship of the Director General of Fair Trading is currently reviewing the working of the Act.
Baroness BURTON of COVENTRY: My Lords, in view of what has transpired over this Question, I am wondering whether I might, by way of question, ask my noble friend the Leader of the House if he would take note of this matter affecting Back Benchers. Is he aware that on Friday two separate approaches were made by the Office of the Minister who has replied to me to withdraw this Question today because it was sub judice? As a result of detailed inquiries which I made yesterday and today, I am informed that no application for leave to appeal has been made by Manchester Corporation on this particular matter. Furthermore, is my noble friend the Leader of the House aware that on page 79 of the Companion it states, under "Matters 'sub judice'":
" A case which has been decided by a court, but is still open to appeal, is not considered sub judice until notice of appeal has been given."
If my information is correct, may I ask my noble friend whether he is aware that as of coming into this Chamber no notice of appeal had been given? Does he not agree that Back Benchers should not be intimidated in this way, in the hope that they will remove their Question, by officials who have not done their homework?
The LORD PRIVY SEAL (Lord Shepherd): My Lords, I am yet to be aware of any Back Bencher who has ever been intimidated successfully by any Minister, past or present. The noble Baroness has asked me a number of questions. Certainly so far as I am concerned the position is that the sub judice rule is not yet in effect because a notice of appeal has not yet been given, but I understand that there have been some indications through the legal processes

1275
that a case may be before the courts in a very short while. It may be for that reason that that warning note was given to the noble Baroness. I was not aware of what information or what pressures may have been put upon her last Friday. If the noble Baroness would care to see me in my room I will certainly look at it, but so far as this particular matter is concerned it is not yet sub judice because no appeal has yet been officially notified.
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, is not the matter a little more complicated than that? I speak in the presence of the noble and learned Lord on the Woolsack, but is it not the fact that no notice of appeal or petition can be presented to appeal unless leave is given, and that so far there has been no petition for leave to appeal? Even after there is a petition for leave to appeal, surely the matter does not become sub judice until leave is actually granted?
Lord SHEPHERD: My Lords, yesterday the noble and learned Lord, in my view, was wrong, but this afternoon I believe that he is undoubtedly right.
Baroness BURTON of COVENTRY: My Lords, I did not give my noble friend notice because I was not aware of what the Government were going to say, except that I was told that they would say that the matter was sub judice. Reverting to the original Question, may I ask the noble Lord, Lord Jacques, whether he can tell us when this report which is being compiled under the chairmanship of the Director General of Fair Trading may be expected? Secondly, would it be possible to expedite and separate this matter of overbooking because air travellers are being gravely inconvenienced, at best, at the present time?
Lord JACQUES: My Lords, so far as the report is concerned, it is expected before the end of the year. In the immediate future it is expected that the Committee will publish a consultative document, and at that point any interested parties can make representations. So far as the issue is concerned, we think it would be wise to wait to see whether or not there is an appeal and what the result of the appeal may be before we start contemplating action.
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, before the noble Lord issues the consultative document will he or the Government bear in mind the practice of the hotel trade in this field, since is it not the case that there is not a hotel in the world that does not overbook on occasion owing to the danger of cancellations? Should not this be taken into account in favour of airlines?
Lord JACQUES: My Lords, the report will deal with the Act as a whole, and the working of the Act as a whole. It will not be specifically dealing with over-bookings. It is obvious that the question of overbooking has difficulties both ways, and that applies to the airlines and to hotels, and consideration of the needs of both parties will have to be taken into account by anybody who is reviewing it.
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, the noble Lord will be aware and will remember that my question was directed to the Government and made no reference to the court, or what was before the court. I hope that he will bear that in mind, because he inadvertently answered as though my question had been related to the legal position, which I carefully avoided.
Lord SEGAL: My Lords, can my noble friend say whether a safeguard against overbooking exists in the reluctance of the booking office clerks to lift the telephone receiver until the bell has rung at least 30 or 40 times?

POLICE FORCES PAY
Lord WILLIS: My Lords, in the absence of my noble friend Lord Shinwell, I beg leave to ask the Question standing in his name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government to state when the police forces last received an increase in pay; whether there is a dispute about the recent award and what is the present situation.
The MINISTER of STATE, HOME OFFICE (Lord Harris of Greenwich): My Lords, at a meeting of the Police Council on 4th June agreement was reached on new pay scales for all ranks

1277
up to and including chief superintendent with effect from 1st September this year, twelve months after the last pay review on 1st September 1974. My right honourable friend the Home Secretary hopes shortly to lay the necessary amending Regulations before Parliament. There is no dispute in the Police Council about the award.

HYBRID INSTRUMENTS COMMITTEE
The PRINCIPAL DEPUTY CHAIRMAN of COMMITTEES (Baroness Tweedsmuir of Belhelvie): My Lords, on behalf of the Chairman of Committees I beg to move the Motion standing in his name on the Order Paper.
Moved, on behalf of the Committee of Selection, That the Lord Wallace of Coslany be added to the Select Committee on Hybrid Instruments.—(Baroness Tweedsmuir of Belhelvie.)
On Question, Motion agreed to.

BRITISH TRANSPORT DOCKS BILL
Read 2a, and committed to the Committee on Unopposed Bills.

SCOTTISH DEVELOPMENT AGENCY (No. 2) BILL [H.L.]
2.48 p.m.
The MINISTER of STATE, SCOTTISH OFFICE (Lord Hughes): My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Scottish Development Agency (No. 2) Bill, has consented to place Her prerogative and interest, so far as they are affected by the Bill, at the disposal of Parliament, for the purposes of the Bill. My Lords, I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read 3a—(Lord Hughes.)
On Question, Bill read 3a.
Clause 2 [General purposes and functions]:
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 1:
Page 2, line 45, leave out paragraph (f).
The noble Lord said: This Amendment is consequential upon the decision taken at the Report stage in your Lordships' House on Thursday last. For convenience, I would remind your Lordships that that decision was that it was preferable to describe briefly what the Agency should aim to do in the field of industrial relations rather than to use the ambiguous term "industrial democracy ", which had found few friends in any part of the House during our discussion. I indicated on Thursday that there would be at least one consequential Amendment today at the Third Reading stage, and this is it.
Lord HUGHES: My Lords, I agree that this Amendment is consequential but not that it is desirable.
On Question, Amendment agreed to.
2.50 p.m.
Lord DRUMALBYN Lord DRUMALBYN moved Amendment No. 2:
Page 4, line 2, after (" construed ") insert (" (a)").
The noble Lord said: My Lords, this is a paving Amendment for Amendment No. 3, and with the leave of the House I will discuss the two together. These Amendments are the same as Amendments I moved in Committee when the noble Lord, Lord Hughes, said he thought the principal Amendment, No. 3, was unnecessary and he implied that it was fully covered by subsection (8) as it now stands. He said that the Agency would be subject to fair trading legislation and that they would also be automatically subject to the Monopolies and Mergers Act. I take it that by "automatically" he meant that by being automatically subject to the law, they would not be subject to investigation by the Monopolies Commission. The noble Lord said he would look at the point, and no doubt he would also have satisfied himself that the Restrictive Practices Division of the Office of Fair Trading could look at any restrictive agreements to which the Scottish Development Agency were a party. My noble friend Lord Campbell of Croy also suggested that the noble Lord might look at the monopolies and mergers provisions regarding newspapers, and the noble Lord agreed to do so. This may be a convenient moment for the noble Lord to indicate to the House

1279
what progress he has made in his examination.
Lord HUGHES: My Lords, as the noble Lord, Lord Drumalbyn, indicated, this matter has been before us already in the form of an Amendment which was tabled in Committee, and the noble Lord then sought an assurance that the provisions of the Restrictive Trade Practices Acts of 1956 and 1968, the Monopolies and Mergers Act, 1965, and the Fair Trading Act, 1973, would apply to the Agency. In the interval that has elapsed I have had an opportunity of looking into the matter in more detail than was possible when I was talking to these Amendments, and I am now able to give an assurance which I think will meet completely the noble Lord's point. For that reason I am grateful to him for tabling these Amendments again, which he has done largely I think to enable me to have this opportunity of getting this matter into the Official Report of your Lordships' proceedings.
The terms of the Restrictive Trades Practices Acts automatically apply to the Agency, as they do to any other person or body. All agreements which the Agency make with outside firms will therefore be required to be registered with the Director General of Fair Trading, as in the case with any private firm. The Monopolies and Mergers Act 1965 was repealed by the Conservatives' Fair Trading Act 1973. I agree with the noble Lord that the Fair Trading Act, unlike the Restrictive Trade Practices Acts, does not automatically bite on the Agency. However, it is the Government's intention, as we have said before, that the SDA will be in exactly the same situation with regard to merger references as private sector companies. I can therefore assure the noble Lord that we will require the SDA to consult the Director General of Fair Trading before engaging in any activity, or making any offer, which would involve the Agency in a transaction likely to result in a situation qualifying for reference to the Monopolies and Mergers Commission under the Fair Trading Act. I hope that this assurance fully meets the points which the noble Lord has raised again today, that he will find that the purpose has been served by tabling the Amendments and that he will find it possible not to press them.
Lord DRUMALBYN: My Lords, I am grateful to the noble Lord. I rather thought at one point he referred to monopolies and mergers when he might have said restrictive trade practices. However, I think that what he has said fully covers what I asked for and in fact quite plainly brings the whole matter under subsection (8), which says:
" … it is hereby declared that nothing in this Act is to be construed as authorising the disregard by the Agency of any enactment or rule of law."
As they all appear to be covered, and as he has given the further assurance as to the practice it is intended to follow, unless the noble Lord wishes to add anything further—
Lord HUGHES: My Lords, perhaps I might interrupt the noble Lord just to add, as the noble Lord referred to the position of newspapers, that I would prefer to defer that matter until the remarks which I propose to make on the Motion, That the Bill do now pass. I have a reference in my notes to the newspaper and television position, which I undertook to speak to on the last occasion; and I mention this now because I did not refer to it when I was speaking a moment ago.
Lord DRUMALBYN: My Lords, I am obliged to the noble Lord and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 4 [Power of Secretary of State to give Agency directions]:
2.57 p.m.
Lord DRUMALBYN Lord DRUMALBYN moved Amendment No. 4:
Page 4, line 18, at end insert—
(" ( ) The Secretary of State shall lay before each House of Parliament any direction given under this section as soon as may be after giving it.").
The noble Lord: Again, this is an Amendment which I tabled in this form in Committee because the noble Lord was good enough to say on that occasion:
"It is the Government's intention to lay directions before Parliament as soon as possible after they are made."—[OFFICIAL REPORT, 10/6/75; col. 219.]
But he went on to indicate that there were circumstances in which the Government might wish to have a discretion not

1281
to lay them immediately—for example, where it appeared to them not to be in the national interest to do so—and he cited as an example a direction to acquire shares in other property. He further said that to announce the direction too soon might cause the price of the shares or the property to go up so that the Agency would have to pay more for them.
I think it right to draw attention to the fact that this raises a difficult question of principle. There is no very obvious reason why the Agency should be in a more favourable position than any other undertaking or individual who seeks to obtain a dominating position in a company. For example, are the Agency not to be subject to any rules about disclosure of the extent of holdings in a company when they have reached a particular extent or about buying through nominees? Do the Government really want the Agency to go bargain hunting and to purchase shares at below their real value when they happen to be undervalued for the time being on the Stock Exchange? Is it really intended that they should be in a privileged position of this kind? If the noble Lord thinks that it would be in the national interest to behave like that, I beg leave seriously to question that. I do not believe, and I hope the noble Lord will confirm this, that it is in the national interest that the Agency should enjoy any privilege of this kind. Having said that, I would concede that there may well be occasions of a different character when it might not be in the interest of national security or the public interest to publish a direction immediately after it is made.
I have not attempted to frame a suitable Amendment to cover this contingency as I had hoped that the noble Lord would himself have put down an Amendment. He knows as well as I do that Parliament is always happy to have assurances. We are even happier, however, if those assurances are put into legislation. In these circumstances, I hope the noble Lord will at least be able to give an assurance, if he cannot accept this Amendment, which I fear will be the position, that the Government will put down an appropriate Amendment in another place.
Lord HUGHES: My Lords, as the noble Lord knows, on more than one
1282
occasion when making a comparison between the Agency and other companies, I have emphasised the extent to which the Agency will be obliged to conform to the City Code on these matters. I feel that this makes it clear that there is no desire on the Government's part that the Agency should be in a privileged position. I indicated that we ought not to go in the other direction arid put the Agency in an unprivileged position, and that we should as far as possible allow them to act in exactly the same way as an ordinary company. I confirm that that is the position.
In relation to the Amendment, as the noble Lord, Lord Drumalbyn, has said, I promised at the Committee stage to look at a similar Amendment to see whether it was possible to incorporate a wording in the Bill to oblige the Secretary of State to inform Parliament immediately after directions had been given, except in cases where there were clear reasons in the national interest why that should not be done. This is one of the provisions in this Bill which is identical to the Industry Bill. I am informed that the latter Bill will be amended in another place to meet this point. I therefore ask the noble Lord not to press the Amendment, on the understanding that, when the Bill again comes before this House, it will have been amended in a way which meets his point. That is the assurance for which the noble Lord asked at the conclusion of his remarks. Therefore, I hope that I have completely fulfilled my undertaking in the matter.
Lord DRUMALBYN: My Lords, I do not expect the noble Lord to guarantee that the Amendment will please me when I see it, but I appreciate his willingness to have an Amendment moved in another place which will go a long way to meet what I have in mind. I am grateful to the noble Lord and I beg leave to withdrawn the Amendment.
Amendment, by leave, withdrawn.
Clause 10 [Powers of entry]:
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 5:
Page 9, line 29, leave out ("48 hours'") and insert ("5 days' ").
The noble Lord said: My Lords, I think it would be for the convenience of

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the House if this Amendment were considered with Amendment No. 6. Both these Amendments seek the Government's views today on the question of notice to be given by the Agency when using their powers of entry. Powers of entry on to property are provided in Clause 10. However, the amount of notice laid down is very small in relation to the likely episodes and the likely use of these powers by the Agency. I shall not rehearse the reasons and examples which I gave at the Committee stage. I would only point out that, however important some operations may seem, they are unlikely, in the activities of this Agency, to be urgent. We do not foresee instances where the Agency would need to act so quickly as to require the short notice which is provided in the Bill. When this point was discussed at Committee stage the noble Lord, Lord Hughes, was good enough to say that the Government would look at it and we have tabled these Amendments to see whether the Government are ready to accept them or something like them. I beg to move.
Lord HUGHES: My Lords, when we were in Committee, I said that these Amendments seemed perfectly reasonable. My only doubt was as to whether they could have any repercussions in other directions. I have since taken advice on the implications for other similar legislation, and I am informed that there would be no serious consequences if we accepted these two Amendments. I am therefore happy to agree to them.
Lord CAMPBELL of CROY: My Lords, before the Amendments are put to a decision, may I thank the noble Lord for having looked at them and for having decided to accept them? I recognise that it has possibly meant setting a precedent in other cases, though I do not believe that there is any other example which would be exactly the same as this Agency. However, I must express the satisfaction of this side of the House that the Government recognise the point which we were making.
On Question, Amendment agreed to.
Lord CAMPBELL of CROY: My Lords, I beg to move Amendment No. 6.
Amendment moved—
Page 9, line 30, leave out (" 7 ") and insert (" 14 ").—[Lord Campbell of Croy.]
On Question, Amendment agreed to.
3.6 p.m.
Lord HUGHES Lord HUGHES moved Amendment No. 7:
Page 10, line 11, at end insert (" except that appropriate Minister "includes the Secretary of State for Industry in relation to the Post Office and "statutory undertakers" includes the Post Office.")
The noble Lord said: My Lords, this is a drafting Amendment to include the Post Office among the statutory undertakers whose operations are safeguarded against the exercise by the Agency of the power to search and both conferred by subsection (4). I beg to move.
On Question, Amendment agreed to.
Clause 13 [Finances of the Agency]:
Lord HUGHES Lord HUGHES moved Amendment No. 8:
Page 12, line 20, after (" Agency ") insert (" (other than payments made by virtue of paragraph 1(3) of Schedule 2 to this Act)").
The noble Lord said: My Lords, the purpose of the Amendment is similar to that of Amendment No. 9, tabled by the noble Lords, Lord Campbell of Croy and Lord Drumalbyn. The Amendment makes it clear that payments by the Agency to the Secretary of State in consideration of receiving public dividend capital (paragraph 1(3) of Schedule 2) are not to be deducted from the sums paid to the Agency from Parliamentary monies which count towards the financial limit. The payments in question are the equivalent of dividends and should therefore not count as capital repayments.
I must admit that when I looked at the two Amendments my preference, as a layman, was for that tabled by the noble Lords opposite. It seemed to indicate quite clearly what is meant, as opposed to the rather roundabout way in which we have worded it to read,
"other than payments made by virtue of paragraph 1(3) of Schedule 2 to this Act ".
However, I am informed that, legally, this is the correct way of dealing with the matter because there could be a situation where a declared dividend and the amount required to be paid were not necessarily the same. For instance, the Secretary of State might decide to leave the Agency with part of the dividend, perhaps to make up for a loss in another direction. I can assure noble Lords that what is in this provision accomplishes exactly what

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they have in mind, even though, the ways of draftsmen being wonderful, it is not as obvious as it would appear at first glance. I beg to move.
Lord CAMPBELL of CROY: My Lords, we had assumed that Amendment No. 8 in the name of the noble Lord, Lord Hughes, was to meet the point which we had discussed at an earlier stage, and to which I returned with Amendment No. 9 with my noble friend Lord Drumalbyn. I quite accept what the noble Lord has said. The Government must have drafted their Amendment in a technical way, because it is not obvious to the non-drafting expert. I am perfectly ready to accept the Government's Amendment which meets our point.
On Question, Amendment agreed to.
Lord HUGHES Lord HUGHES moved Amendment No. 10:
Page 12, line 24, at end insert (" and loans guaranteed by a wholly owned subsidiary of the Agency ").
The noble Lord said: My Lords, at present, sums outstanding on loans contracted by private borrowers with the backing of an Agency guarantee count towards the Agency's financial limit, because they represent a contingent liability on the Agency's resources. However, depending on their articles of association, wholly-owned subsidiaries of the Agency may also be in a position to guarantee borrowing by other persons, and sums outstanding on such a borrowing would create an equivalent contingent liability on the funds of the Agency. The effect of this Amendment is to ensure that that is so.
My Lords, this Amendment fulfils the commitment I gave when speaking to Amendment No. 76 put forward by the noble Lord, Lord Campbell of Croy, when we discussed the matter in Committee. My Lords, I beg to move.
Lord CAMPBELL of CROY: My Lords, I had recognised that this was a response to the discussion we had on an Amendment of mine at an earlier stage, and it meets the point which was raised.
On Question, Amendment agreed to.
Clause 19 [Assistance to persons providing air services serving the Highlands and Islands]:
3.10 p.m.
Lord HUGHES Lord HUGHES moved Amendment No. 11:
Page 15, line 31, at end insert ("; and he may dispose of such shares or stock ").
The noble Lord said: My Lords, I beg to move Amendment No. 11. This Amendment allows the Secretary of State to dispose of shares and stock required under Clause 19 and it fulfils, in part at least, an undertaking given by me when I was speaking to Amendment No. 68 put forward by the noble Lord, Lord Campbell of Croy. As it stands Clause 19 does not allow the Secretary of State to dispose of shares which he acquires in an air transport company. This Amendment, which I think will be acceptable to noble Lords opposite, rectifies the omission.
Lord CAMPBELL of CROY: My Lords, we are grateful to the noble Lord for having put down this Amendment. It does not meet all the changes to Clause 19 that we were suggesting during the Committee stage, but we know that that is another matter, that decisions are being taken on the Industry Bill, and that therefore this Bill must await Amendments made to that parent Bill in the form of words to be used. But this point arose in our discussions and the noble Lord appears to have dealt with it in this Amendment.
On Question, Amendment agreed to.
Lord HUGHES Lord HUGHES moved Amendment No. 12:
Page 15, line 36, at end insert (" except that the Secretary of State may thereafter hold or dispose of shares or stock acquired under subsection (3) above").
The noble Lord said: My Lords, I beg to move Amendment No. 12. As the Bill stands, it is not clear that the Secretary of State may hold and dispose of shares acquired under Clause 19(3) after the expiry of the five-year limit imposed by subsection (5). This Amendment makes it clear that he may do so. Putting forward this Amendment fulfilled the second part of the undertaking which I gave to the noble Lord, Lord Campbell of Croy, in Committee.
Lord DRUMALBYN: My Lords, I wish to raise a point. The matter is

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perhaps a little curious. The clause gives to the Secretary of State power to assist
" persons who provide or propose to provide … services"
to the Highlands and Islands, and to make either a
"grant or loan … to any such person as aforesaid."
Is there any reason why the Secretary of State, once the power to give this assistance is ended, should continue to hold shares or stock of these companies? If he is not involved otherwise, why should he do this?
Lord HUGHES: My Lords, I am not at all certain that there is a very great likelihood that there would be any acquisition of shares or stock in a company. It is a possibility; it may in fact be the best way of dealing with it. It might not be in the interests of either the Secretary of State or the company that any shares or stock, if they had been acquired, should automatically have to be disposed of at the end of a five-year period. Obviously, if there were such holdings, the disposal should be in the best interests of all concerned. Unless there was a provision of this kind it might not be possible to have regard to the best way of dealing with the matter. This is all that is required.
Your Lordships will be able to imagine circumstances in which if the Agency, holding shares in what after all would not be a large undertaking, were obliged automatically to dispose of the shares at a particular time that might have a very depressing effect on the shares of the company generally. Therefore it is reasonable that there should be a certain amount of flexibility in the matter, and this Amendment enables that to be achieved.
On Question, Amendment agreed to.
3.16 p.m.
Schedule 2 [Financial and Administrative Provisions relating to the Agency]:
Lord DRUMALBYN Lord DRUMALBYN moved Amendment No. 13:
Page 24, line 23, at end insert—
"Disposal of Securities
4A.—(1) Before agreeing to pay money to the Agency under paragraphs 1 or 2 or to lend money to the Agency under paragraphs 3 or 4 of this Schedule the Secretary of State shall
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consider whether and to what extent any of the money to be paid or lent, as the case may be, could be raised by disposing of any securities issued by any company, and acquired by the Agency in exercise of the power conferred on them by subsection 4(a) of section 2 of this Act or transferred to them under section 16 of this Act, and if in consequence of such consideration and after consulting the Agency and the company he is of the opinion that such disposal can be effected without detriment to the exercise by the Agency of their functions and without detriment to the interests of the company, he may, after consulting the Agency, direct them to dispose of the securities in such manner as may be agreed between the Agency and the company.
(2) Nothing in the foregoing sub-paragraph shall be construed as limiting the power of the Agency to dispose of securities which they have acquired or which have been transferred to them, but before disposing of any securities which the Secretary of State has directed the Agency to acquire or has transferred to them, the Agency shall obtain the approval of the Secretary of State."
The noble Lord said: My Lords, I beg leave to move this somewhat lengthy Amendment. We had fairly lengthy discussions both in Committee and on Report regarding the disposal of shares acquired in businesses. Your Lordships will find these discussions reported at column 187 of the Committee stage and at column 1026 of the Report stage. Our object was to secure that the provision in Section 7(5) of the Industry Act 1972 was retained in this Bill in whatever form was appropriate. I wish to remind your Lordships that that subsection reads:
"Where financial assistance is given under this section by acquiring shares or stock in a company, the Secretary of State shall dispose of the shares or stock as soon as, in his opinion, it is reasonably practicable to do so; and before making the disposal the Secretary of State shall consult the company."
The noble Lord said during an earlier discussion that it would be out of keeping with Government policy on public holdings in industry to require that they should be disposed of as soon as reasonably practicable. This has generally been understood to mean as soon as the company no longer needed that kind of support, and the shares could be disposed of to the public without loss to the Government or the Agency. The noble Lord went on to indicate that it would not be desirable to allow control of a Scottish company to pass into the hands of a company outwith Scotland, if only because that company might close down

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the Scottish company, and with that we should certainly agree.
However, at the Report stage the noble Lord did not give the impression that it was the Government's intention to build up an enormous permanent holding in Scottish companies, whether with the controlling interest or as a mere investment. We argued that the total amount that the Government could afford to invest was necessarily limited, unless it was to be financed by inflationary creation of money. In other words, the available funds should he on a revolving basis, the Government coming to the aid of companies which, for one reason or another, needed capital and were unable to obtain it elsewhere; and that when the company no longer needed Government support, the securities should be disposed of and the funds realised and invested in companies which did need support.
Therefore, my Lords, this Amendment lays on the Secretary of State the duty of constantly keeping under review the requirements of companies in which the Agency have invested, with a view to disposing of them, in order to make money available for the functions of the Agency. In this way the calls on the public purse will be kept under closer control. I dare say that the noble Lord will say that the Amendment is much too restrictive, and that it is burdensome to place the obligation on the Secretary of State to see what holdings could be disposed of every time the Agency needs more money or when the Secretary of State thinks that they should have more money for a particular scheme of his. To that I should reply: not at all. Surely it is desirable that the Agency should keep the Secretary of State informed of how their investments are going and of which companies are becoming viable. After all, this is going to be an Agency. With such information kept regularly up to date, the Secretary of State should have no difficulty in deciding whether to let the Agency have a fresh infusion of funds, or to say "No" and indicate how they can obtain the money from their own resources. We talk about money being generated from their own resources, and perhaps this is one of the ways by which this can be done in the case of the Agency.
I do not for a moment suppose that this rather complicated Amendment is acceptable in its present form, but I should like to hear the noble Lord say that, in principle, the approach outlined in the Amendment is one which will he considered when the Secretary of State prepares the guidelines for the Agency of which the noble Lord has told us. I think your Lordships will accept the fact that the Agency should be of real help to Scottish industry; that they should not attempt to bite off more than they can chew, and that the amount of public money they use should be deployed to the best advantage and with due regard not not only to the purposes of the Bill as set out in Clause 2(1), but to the need to contain public expenditure. I have rather pressed my remarks on this Amendment, but I hope I have made my meaning clear and I beg to move.
Lord HUGHES: My Lords, I mast congratulate the noble Lord, Lord Drumalbyn, on yet another attempt—and I must admit a highly ingenious one—to write into the Bill a provision which will convey the impression that it is desirable, other things being equal, for the Agency to dispose of shareholdings. The noble Lord has set an admirable example of brevity which I would wish to follow, so, like him, I will not rehearse again the arguments we have already discussed. However, there is a difference of approach in principle. At the risk of over-simplifying, noble Lords opposite think it undesirable that shares should be held and we do not adhere to that view. However, I am not in total disagreement with the noble Lord, because, obviously, it could be frustrating to the purposes of the Development Agency if too much of their funds was tied up in enterprises which were successful and in circumstances where, by having resource to those funds, they could add to their success by making the money available in other directions. This will obviously be part of the operations of the development agency, so when we talk about a rolling "fund of money" we are on much more common ground.
Having first indicated that there is a difference of approach between the Government and the Opposition in this matter, I have also got on to the point where, if we are not on common ground, we are approaching it. I therefore go on

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to talk about the Amendment, not on grounds of principle but as to why we consider it inappropriate, and the noble Lord will not be surprised when I add that it is unnecessary. First, under Clause 4 the Secretary of State is already empowered to direct the Agency to dispose of a particular shareholding if he considers it necessary to do so. The point which the noble Lord made was that if on being notified of the holding the Secretary of State thinks that it is much better to sell certain shares rather than get fresh money, he is empowered to do so under Clause 4.
I almost thought that by some mischance the noble Lord had been able to lay his hands on my brief, because he has read almost word for word the next paragraph. But I am now satisfied that he had not done so, because he did not read the last paragraph which I will do. As the noble Lord anticipated, we think that the idea of requiring the Secretary of State to review the Agency's entire portfolio of shareholdings, with a view to identifying realisable assets every time they went to him for funds would be wholly impracticable in terms of the administrative burden which this would impose on the Secretary of State, apart altogether from the objections to such a procedure which I and the Government have on the grounds of principle.
Lord DRUMALBYN: My Lords, may I intervene for a moment? I rather anticipated that the noble Lord would say that, but it seems easy for the Secretary of State to have a list of items of investment ripe for disposal.
Lord HUGHES: The noble Lord should wait until I get to the last paragraph! The Amendment is also more restrictive on the Agency than those which were tabled last week, in that it would give to the Secretary of State and not to the Agency themselves the power to decide whether disposal of a particular shareholding would be consistent with the attainment of their objectives.
I now come to the paragraph which the noble Lord has not seen. I am a little amused, almost amazed, at the ambivalent attitude which Amendments tabled during the proceedings have in relation to the Agency and the Secretary of State. In this Amendment, the Secretary of State is
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seen as a benevolent influence with the interests of the private sector at heart. But when we were considering Clause 4 in Committee, noble Lords opposite wanted to remove the power of the Secretary of State to give specific directions to the Agency, the one which would enable him to do exactly what the noble Lord wants. At that point, they appeared to look upon him as a sinister figure intent on directing the Agency to do this, that or the other undesirable thing which they would not have wished to do of their own accord. In a matter of this kind, either the Secretary of State will always be benevolent, or he will always be malevolent. He will not be both at the same time.
Lord DRUMALBYN: My Lords, may I intervene again? Some Secretaries of State are more sinister than others. The point here is quite clear. I was envisaging this not as being in the interests of private industry, but as being in the interests of the taxpayer and of the economy in putting constraint on the total amount of money that has to be lent.
Lord HUGHES: My Lords, the noble Lord's ingenuity did not end when he drafted the Amendment; he can bring it to bear in arguing for it. I think it would be time wasting for me to continue much longer on this matter. I think the power in Clause 4 enables the Secretary of State to do exactly what this Amendment seeks. Obviously, the sort of occasions when he is likely to do this are what I have described as the common ground which the noble Lord and I have reached, when this is obviously the best way of making money available. After all, the Agency do not have access to unlimited funds; they have access to generous funds—£200 million in the first place, and if Parliament so decides the figure can go up to £300 million. Within that figure one wants to make certain that the money is being used in the best way. There will be occasions, possibly not once but time and time again, when the best way of dealing with a successful operation is to bring it to an end and move on in other directions. But we cannot say that that will always be the case. There will be times when the best interests of the taxpayer of the Agency and of private enterprise will lie in holding on to such an interest. We think that by relying on the specific

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powers given in Clause 4 the Secretary of State can do exactly what the noble Lord, Lord Drumalbyn, is asking for when this becomes desirable.
Looking back on my experience of Secretaries of State over quite a number of years, I do not think that I would have applied the word "sinister" to any of them. All that I would say, without disrespect to the noble Lord, Lord Campbell of Croy, is that some of them seemed to me to be better than others—but the ones that I regarded as being good might not be so necessarily in the opinion of noble Lords opposite. So far as the general public of Scotland is concerned, I do not think that any of them would ever have been regarded as being particularly sinister or particularly benevolent.
Lord CAMPBELL of CROY: My Lords, I am glad that the noble Lord has acknowledged the ingenious further attempt by my noble friend at drafting, in order to include in the Bill something which we felt necessary—although the noble Lord, Lord Hughes, indicates that in the last resort the Government do not consider it so. Lest there has been any misunderstanding from what he said about our attitude to Clause 4, I want to remind the noble Lord that when we had an Amendment at Committee stage seeking to eliminate the words "or specific" before "directions" it was in order to draw attention to what is virtually a new departure in Government legislation and to seek an explanation from the noble Lord. We did not press that Amendment, but the noble Lord, Lord Hughes, in replying to our point admitted that in this complex of the Industry Bill, to which I have referred before, it was a new departure that Ministers should be able to give specific directions as well as general directions. Having sought thus to explain and to listen, we did not press it. We were not at that stage considering whether the Secretary of State of the day was going to be benevolent or malevolent. We wanted merely to draw attention to it. I am sorry that the noble Lord is unable to accept this Amendment to the Schedule which my noble friend has tabled, but I hope that it will be possible for the Government to consider this matter further when the Bill reaches another place.
Lord HUGHES: My Lords, I should not be totally surprised if it did not emerge again in another place.
Lord DRUMALBYN: My Lords, may I thank the noble Lord for his explanation of the Government's attitude on this subject? I think that in the course of this Bill we have come a lot closer together in considering the various aspects. We have been able to get the noble Lord to say that, at least as far as he is concerned—and I hope that he was speaking fully for the Government—the full rigours of the Bill, so to speak, that we envisaged were not likely to be applied. This is a great gain in this particular case. He has dispelled the idea that the Scottish Development Agency will operate as a vast investment holding company in the interests of the nation and that sort of nonsense. He has said that it will concentrate on doing the particular job it is supposed to do, which is to promote the economy of Scotland. This is all to the good. I can only express my gratitude to the noble Lord for the consideration he has given to these matters and for the courageous way in which he has stated the answers. I see that the noble and learned Lord is about to put the Question. Perhaps I should have indicated my intention to do so earlier; but may I now beg leave to withdraw the Amendment?
Amendment, by leave, withdrawn.
Lord HUGHES: My Lords, in case the noble and learned Lord who sits on the Woolsack short-circuits me again in his anxiety to get on to the Welsh Development Agency Bill, I beg to move the Privilege Amendment.
Moved, That the Privilege Amendment be agreed to.—(Lord Hughes.)
On Question, Privilege Amendment agreed to.
3.34 p.m.
Lord HUGHES: My Lords, I beg to move that this Bill do now pass. I had indicated that in so doing I would take the opportunity of replying to a number of points which came up during the earlier discussions. First was the question of the confidentiality that the Agency would have to abide by. I was asked what arrangements would exist to ensure that

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members of the Agency respected the confidentiality of information given to them in the course of their activities. Basically, there are two types of information to be considered: information which members and officers of the Agency gain access to by virtue of the powers in the Bill; and information given voluntarily to them by companies, authorities or individuals with whom they have dealings in the normal course of their duty. I would emphasise that the greater part of the information which the Agency obtain will fall into the latter category of information freely supplied to them since their powers to obtain information are very limited. Where information is supplied freely the Agency will, of course, be expected to safeguard any confidences given to them as a matter of good and honourable commercial practice. It is entirely reasonable to expect them to do so; but if, by any chance, there were a breach of confidence where damaging consequences were alleged this would be actionable in the courts in the normal way.
Where the Bill enables the Agency to obtain access to information, it provides ample safeguard against the unauthorised disclosure of sensitive matter. I will deal with the relevant provisions in turn. Clause 11(1) gives the Agency a very limited power to obtain information about interests in land. This is well precedented in planning legislation, raises absolutely no question of confidentiality, either commercial or personal, and thus creates no need to provide penalties for disclosure. Clause 11(6) gives the Agency access to certain information collected under the Statistics of Trade Act 1947. This information could scarcely be described as commercially sensitive, consisting only of the name and address of establishments, their number of employees and the nature of their business. None the less, un-authorised disclosure of this information carries a penalty of a fine of up to £400, by virtue of Section 4(5) of the Employment and Training Act 1973. Finally, Clause 10, which provides powers of entry on land, makes explicit provision for the possibility that the Agency might gain access to confidential information about commercial processes in entering premises; and it makes unauthorised disclosure of such information subject to a
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penalty of up to £400 and/or imprisonment.
My Lords, we gave very careful consideration to the range of topics which it would be proper for the Agency's information powers to cover. We decided as a matter of deliberate policy to make these much more limited than the corresponding powers of the Highlands and Islands Development Board, since we recognise that the Highlands and Islands Development Board's wide powers to obtain information about businesses as well as land for any purpose reasonably connected with their functions might be regarded as excessive in view of the active entrepreneurial role which the Agency are intended to play. The denial of these powers to the Agency removes any need to copy the special penalties on disclosures which are contained in the Highlands and Islands Development (Scotland) Act.
On the subject of newspapers, the noble Lord, Lord Campbell of Croy, asked on 10th June whether the Government envisaged the Agency taking up shares in newspapers or television companies; and he raised in this context the implications of any such action for the freedom of the Press. The position is that the Bill empowers the Agency to acquire a holding in any industrial undertaking where this is in furtherance of the Agency's objectives. "Industrial undertaking" is defined to include any description of commercial activity and therefore certainly includes newspapers or broadcasting companies. One of the Agency's objects is to provide, maintain or safeguard employment, and as the noble Lord said on 10th June, we have had recent experience in Scotland of Government financial assistance being given to a newspaper company on employment grounds. These are the only grounds which would justify the involvement of the Agency in a mass-media concern. The need for such assistance is, to put it mildly, unlikely to be a frequent occurrence, but it cannot be ruled out completely. What the Government have in mind is that the Agency should only be able to invest in such a company when acting under a direction from the Secretary of State under Clause 5. In such a circumstance we should provide that the Agency would not interfere with editorial freedom. The Secretary of

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State's powers of direction already enable him to achieve these objectives, but we think it would be desirable to make our intentions clear in the Bill and we shall be tabling Amendments to this effect when the Bill goes to another place.
There was the question of the guidelines on the relationship between the Agency and the National Enterprise Board. When we were discussing Clause 14 I gave an undertaking to the noble Lord, Lord Campbell of Croy, to say something at this stage about the Government's thinking on the guidelines which we have in mind to issue to the Agency and to the Board covering their respective operations in Scotland. I may not be able fully to satisfy your Lordships' natural interest in these matters at this stage, but I hope that what I have to say will he helpful.
First, the final guidelines will not be issued until both the SDA and the NEB are in being, because it is right that both bodies should have an opportunity to discuss their contents. The guidelines are not something to be imposed on them from outside without consultation. This is in keeping with the provision in the Bill requiring the Secretary of State to consult the Agency before issuing any direction to them. As I said on Second Reading, the guidelines will be made widely available since it is right that Parliament, and essential that industry, should be fully aware of the arrangements which exist. We have yet to decide, however, exactly what form publication should take. It may not be appropriate for the guidelines to have the formal status of directions, since some of the points covered might not be instructions so much as general guidance on matters which leave a good deal of discretion to the Agency and the Board. The annual reports of the Agency and the NEB would be one possible vehicle for publication, but something quicker than that might be thought appropriate and we are considering all the possibilities.
As to the contents of the guidelines, among other things they will deal with the exercise of those functions of the NEB in Scotland which are not devolved to the SDA. These are the functions of extending public ownership into profitable sectors of industry; promoting schemes for the reorganisation or development of an industry at national level;
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acting as a holding company for State holdings in industry; acting as a channel of selective assistance to companies with branches in Scotland which need to be assisted on a United Kingdom basis; and acting, where appropriate, as an additional source of investment finance to such companies.
I repeat, these are not functions which are to be devolved to the Scottish Development Agency. Whenever the NEB formulates or promotes a scheme affecting an industrial sector which is significantly represented in Scotland it will consult the SDA during the formative stages of its plans, whether or not these include the acquisition of an interest in Scottish undertakings in that sector where it proposes to acquire an interest in a United Kingdom company significantly represented in Scotland (and especially where it seeks a controlling interest) it will consult the SDA and will thereafter keep the Agency closely informed about the company's progress and about plans for its future. Where appropriate it might employ the Agency as its agent in dealing with the Scottish end of the company, for example, in providing management assistance and other advisory services.
Perhaps the greatest difficulty to be resolved is how to express the dividing line between cases in Scotland which are to be financed by the NEB and those which are to be financed by the Agency. We shall be working out these details. We propose to consult the CBI and the STUC. Broadly we intend to adopt general principles whose applications will be determined, fairly pragmatically, on a case-by-case basis. The point is that there will be no rigid demarcation between some companies or undertakings in Scotland which are the concern of the Agency and others which are reserved to the NEB. It will be part of the responsibility of the Agency to develop contacts with the whole of Scottish industry. It will be able to enter into discussions with any Scottish-based company, or the management of any Scottish undertakings, to see how that company or undertaking can best contribute to the general good of the Scottish economy. If proposals emerge from such discussions which point to action by the NEB, as well as the SDA, for example, assistance to, or acquisition of, an interest in holdings in

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England, the Agency may make proposals to the NEB to that effect. There is absolutely no question of the Agency's own activities being limited to small locally-owned companies, as some misguided Press comment might have indicated. As a corollary of the arrangements which the NEB will adopt for consulting the SDA, the Agency will likewise be expected to keep the Board informed of any plans which it has in mind for the development of a sector of industry in Scotland which could affect undertakings in the rest of Britain, and of any interest it proposes to take in companies with branches elsewhere in the United Kingdom.
On the subject of the guidelines, my statement is fairly lengthy, perhaps not necessarily easy to take in completely by merely listening to it. I believe, however, not only that noble Lords opposite are interested in hearing for themselves part of the Government's thinking but that there should be something on the record which could be read by people outside your Lordships' House, for example, by the industry concerned, so that at least, whatever their fears about the effect of this Bill on industry generally in Scotland, they need not labour under unnecessary fears. The more the Government are able to put this matter on the record in the House the more opportunity those people will have of reassuring themselves on certain aspects.
The Bill leaves us in a different form from that in which it was first introduced in another place. I cannot pretend that all the changes which have been made in the Bill are ones which the Government would consider advantageous to the economy of Scotland. But, even though I regret that certain major changes have taken place and which I am certain another place will wish to reverse, it would be wrong if I did not take this opportunity of thanking noble Lords in all parts of the House, but particularly noble Lords on the opposite Benches who have taken the leading part in considering the Bill. I express my pleasure for the way in which, in general, they have considered it, and for the points which have been raised and which have enabled the Government to accept Amendments which have been tabled or, alternatively, have allowed the Government to table Amendments at various stages to meet certain
1300
points. Therefore, with complete sincerity, I can say that in some respects the Bill goes to another place in a better form than that in which the Government first presented it to your Lordships. I hope that when the other place have finally disposed of the matter the Bill will be somewhat better from the Government's point of view than it is at the present time.
Moved, That the Bill do now pass.—(Lord Hughes.)
3.50 p.m.
Lord CAMPBELL of CROY: My Lords, we are grateful to the noble Lord, Lord Hughes, for having taken the opportunity at this stage of making statements on some of the points on which he told us he hoped to inform your Lordships' House: for example, confidentiality and the rules for disclosure of information by firms; on the question of whether the SDA could take shares in the Press and television—and we were interested in the noble Lord's proposal that there should be Amendments in another place to regulate such a situation; and lastly, what I acknowledge to be the important statement which he has made on guidelines to be issued to the National Enterprise Board and the Agency. That, it is clear from the length of his statement to which he referred, is by no means a simple matter to resolve.
Regarding the Bill as a whole, the noble Lord and I disagree about the principal Amendments which we have made to Clause 2. Those Amendments are to three subsections which repeated parts of the Industry Bill, and those changes have been welcomed by representatives of Scottish industry whom the Agency are to assist, and with whom the Agency are to work. The Industry Bill itself, we understand, is shortly to undergo changes in another place at the hands of the Government. According to Press reports, an announcement on this is expected at any moment. The present intention of the Government therefore to reverse our principal Amendments in another place may be felicitously overtaken by the Government's second thoughts on the Industry Bill because, as I said, the Amendments refer to parts of this Bill which are reproduced in the Industry Bill. I would add that no single action of the Government is more likely

1301
at the moment to restore the confidence of British industry than an announcement by the Government to make the necessary and relevant changes to the Industry Bill. I hope we have assisted the Government's very tight Parliamentary programme by anticipating some of these changes in the Scottish Bill.
Besides those Amendments, there have been a number of other points where the Government agreed to make changes, and we are grateful to the noble Lord for the Amendments which he has accepted or replaced by Amendments from the Government side dealing with the same points, some of them made today. He has also indicated that, because there was not enough time available in your Lordships' House during the passage of the Bill, he is proposing other Amendments should be tabled by the Government in another place, and we can expect to see some results from our labours emerging in the form of Government Amendments there. The noble Lord referred today to the code, in guidelines, which are to prescribe the relationship between the NEB and SDA. Their fields of activity will certainly need to be clearly defined and separated if collisions and confusion are to be avoided.
There are, none the less, still all the makings of bureaucratic muddle since there will also be other agencies operating in Scotland. I draw attention to this because the guidelines affect only two of the agencies. There is also the proposed National Oil Corporation with somewhat similar powers which will presumably carry out much of its activity in Scotland. In addition, in the North and West there is already a development agency responsible to the Government—namely, the Highland Development Board. Consequently, in the North and West of Scotland there are no less than four agencies at large, and I suggest the proposed code will need to be extended to clarify the roles and relationships of all four bodies in that area, and certainly of three bodies in the rest of Scotland.
Lastly, I should like sincerely to congratulate the noble Lord, Lord Hughes, on again handling this Bill single-handed. This has meant long, continuous sessions dealing with different points, most of which have been put from this side of the House. Because the
1302
Scottish Bill was taken first at each stage. we have in our debates been paving the way for similar points to be raised in the Welsh Bill, and the burden therefore of dealing with these points for the first time has again fallen heavily upon the noble Lord, Lord Hughes, who has borne it with his usual good humour. May I also thank my noble friends for the part they have played in the extended Committee and Report stage debates in helping what we consider to be improvements to be made to the Bill and which I am glad to say in a number of cases both sides of the House consider and agree to be so. I should especially like to thank my noble friend Lord Drumalbyn for the tremendous amount of work he has put into the Bill and the drafting of Amendments.
3.57 p.m.
Lord DRUMALBYN: My Lords, may I make two small observations? First, as we made progress with this Bill so I came to like it a little more than I did to start with; but I am afraid the noble Lord's closing remarks today have caused me to dislike the prospect of the Industry Bill even more than I did before. My noble friend talked about a "bureaucratic muddle". But that will be nothing whatever like the political muddle which will ensue when we have Scottish Assembly. The noble Lord may think there may be a broad division of the Scottish Development Agency which will be the responsibility of the Scottish Assembly, but I doubt whether it will be easy going, if the responsibility for the Industry Act—as it may then be, although I hope it will not—lies here at Westminster. There are going to be some sticky problems ahead. Having said that, I wish the noble Lord well with this Bill.
On Question, Bill passed, and sent to the Commons.

WELSH DEVELOPMENT AGENCY (No. 2) BILL [H.L.]
3.58 p.m.
The LORD CHANCELLOR (Lord Elwyn-Jones): My Lords, I have it in command from Her Majesty the Queen and the Prince of Wales that they, having been informed of the purport of the Welsh Development Agency (No. 2) Bill, have consented to place their prerogative

1303
and interests, so far as they are concerned on behalf of the Crown, the Duchy of Lancaster and the Duchy of Cornwall, at the disposal of Parliament for the purposes of the Bill. I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read 3a. (The Lord Chancellor.)
On Question, Bill read 3a.
Clause 1 [The Welsh Development Agency]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 1:
Page 1, line 17, leave out ("improve") and insert (" further the improvement of ").
The noble and learned Lord said: My Lords, it may be convenient for your Lordships to discuss this Amendment with Amendment No. 2 with which this Amendment is linked. The effect of the Amendments is to substitute the words:
"to further the improvement of the environment … having regard to existing amenity "
as one of the purposes for which the Welsh Development Agency may exercise their functions, instead of the present purpose:
"to improve the environment in Wales",
which was so notably unattractive to my noble friend Lady White. In her observations to the House my noble friend rightly directed our attention to one of the most important jobs of the Agency as proposed in the Bill.
These Amendments enable me to comment on the environmental provisions of the Bill, both in Clauses 1 and 13, observations which I had intended to make at Committee stage, but that opportunity did not, through unforeseeable events, arise. I hope that in doing this I shall be able to allay some of the fears of my noble friends. First, as to the environmental responsibilities the Government would like the Agency to have, some disquiet has been expressed about the position of other bodies concerned with the environment, and there was discussion about the relationship between the Agency, local authorities and other bodies. I was asked to explain in more detail what obligations were laid on the Agency to consult with local authorities and other such bodies.
Perhaps I might begin by saying a little about Clause 13. That has given rise
1304
to some concern and there have been attempts to redraft it, but I wish to make it clear that the powers in the clause have been drafted in a way which would allow the Agency to work usefully in older urban areas in Wales, with particular emphasis on areas of industrial or commercial significance. This is in line with the Government's stated intention in the consultation paper. But to attempt to limit this clause to those older urban or industrial areas alone would be restrictive. We believe it would be a pity to restrict the Agency in that way, or to confine their role so that it might be in danger of being ultra vices on some otherwise wholly acceptable scheme. So, in our view, it does not make sense to try to lay down hard and fast rules. The legislation is broadly framed, and deliberately so, in order that the Agency can amend its approach to what will best suit the circumstances.
The work which is imposed on the Agency in Clause 13 is a natural partner to the specific work concerned with derelict land reclamation, which is covered in Clause 14. Nobody in Wales would question the value of this work. It is important to recognise that by this Agency we are seeking to establish a body which will have available additional finance for the good of Wales. It is not a malevolent, uncontrollable Llyn Llanelly monster that we are inflicting upon Parliament or the public. There is no danger whatsoever of the Agency putting forward proposals which would not be acceptable to local authorities. I should like to make it clear beyond doubt that the Agency would be expected to bring forward schemes for approval in full consultation and harmony with local authorities. What we are seeking is partnership in the fullest sense.
The Agency will have to obtain planning permission from the local planning authority, since they are not—and I repeat "not"—being placed in a privileged position. They will need to seek planning permission whenever that is required. We acknowledge that bodies other than local authorities, such as the Countryside Commission and the Civic Trust—although I hasten to add that that is not an exhaustive list, and that is one of the problems involved in spelling out these other agencies in the Bill—will have an interest. This is why an

1305
obligation is laid on the Agency to consult them, and I canot believe that the Agency will fail to do so.
I hope that what I have said will reassure noble Lords that there is no question of the existing duties, powers or functions of any of the existing bodies concerned with environmental matters being affected in any way by the creation of the Agency. For the avoidance of doubt, I want to take this opportunity again to reaffirm the assurances already given that in the environmental field, as indeed in every other—for example, industrial development and promotion—the creation of the Agency will not erode the powers or responsibilities of local authorities or other bodies.
I should now like to look at the Amendment. We have sought to make it explicit throughout that there is no intention of establishing the Agency in order to detract from the role of local authorities as statutory planning authorities, as I have said. This is why we would not think it appropriate to give the Agency powers to safeguard the environment, which is a proposition that seemed attractive to my noble friend. Rather, we see the Agency's powers as being used to develop and improve the environment where there is evident scope and need for doing so. This explains the responsibilities which will be imposed on them in respect of derelict land reclamation and the re-invigoration of urban areas. At the same time, the Agency will be expected to play their part, and indeed to give a lead, by having full regard to environmental considerations in all the work they carry out or sponsor, particularly regarding industrial development.
My noble friend drew our attention at the Committee stage to the wording in the Scottish Bill—" furthering the improvement of the environment ". The implication of this is that the Agency is only one of the organisations concerned with the environment. We have looked at this again and I am glad to say that we are very content to adopt similar wording. But we have thought it right to add to this in order to meet the points which have been made. In these matters it is not easy to find a form of words which will satisfy everyone. That is a common human experience, reminding one of, for instance, the occasion when Oscar
1306
Wilde said of the Niagara Falls that they would be much more impressive if the water flowed the other way. One cannot possibly please everyone, but I hope that the phrase, "having regard to existing amenity ", and indeed the Amendment as a whole, will be acceptable to your Lordships I beg to move.
Baroness WHITE: My Lords, I should like to express my gratitude to my noble and learned friend the Lord Chancellor for having moved his Amendment and taking with it Amendment No. 2. I think this fairly meets the apprehensions which I expressed earlier in our deliberations. I am particularly glad that he has been good enough to spell out in some detail the attitude of the Government both to local authorities and to the other bodies—statutory ones such as the Countryside Commission, and voluntary ones such as the Civic Trust, the Council for the Protection of Rural Wales, of which I have the honour to be president, and other bodies concerned with environmental matters in the Principality. One of the difficulties was that in such consultations as took place before the Bill was promulgated this environmental aspect was, perhaps understandably, rather left on one side while people concentrated on the industrial functions of the Agency, which of course are paramount. So I am very happy that the position has now been made quite clear.
I freely admit that the various Amendments which I have suggested at different times during our previous deliberations were not entirely satisfactory, for the reasons indicated by my noble and learned friend. This Amendment to line 17 indicates a more cautious and modest approach to the Welsh environment than was contained in the earlier, rather arrogant, version. That being so, I think it would be right to accept it gratefully and to acknowledge that there may well be circumstances in which the Agency can be extremely helpful. I make no apology for having laboured this matter, because, at least in the rural areas of Wales, we not infrequently come across cases where industrial and environmental interests conflict.
It is extremely important that the Agency should be conscious that they have responsibilities in both directions. Sometimes these conflicting interests are

1307
very hard indeed to reconcile, particularly in areas of high unemployment such as North and West Wales, where there is a very natural inclination to go all out for jobs at almost any price. In the long term that is not necessarily in the interests of the area itself. Therefore, I hope very much that in all its activities the Welsh Development Agency will try to keep a fair and sensitive balance between these conflicting interests—more especially, as I say, in our most beautiful, landscaped areas of Wales.
There has never been any issue at all between us on derelict land. I think we are all proud of the work which has been done by the development land unit at the Welsh Office, and if it does as well under the aegis of the Welsh Development Agency then I am sure we shall all be very glad indeed. I welcome very much the care and attention which has been given by my noble and learned friend and his colleagues to this matter, and I wish to thank him.
On Question, Amendment agreed to.
The LORD CHANCELLOR: My Lords, as I indicated, Amendment No. 2 is linked with, and is to some extent consequential on, Amendment No. 1. I beg to move.
Amendment moved—
Page 1, line 17, at end insert (" (having regard to existing amenity).").—(The Lord Chancellor.)
On Question. Amendment agreed to.
4.12 p.m.
Lord ABERDARE Lord ABERDARE moved Amendment No. 3:
Page 2, line 6, leave out paragraph (d) and insert—
(" (d) to promote, or help to promote, good industrial relations in, and appropriate means of employee involvement in the affairs of, undertakings with which the Agency are associated;").
The noble Lord said: My Lords, I am sorry that the House has to revert again to this Amendment. It is in the same terms as an Amendment which was tabled to the Scottish Bill and which is now incorporated in that Bill as a result of a decision by this House. Therefore, I had hoped that at the Report stage the Government would have felt able to bow their heads, though reluctantly, and to accept an Amendment which, although
1308
they did not agree with it, the House had expressed an opinion on and had accepted in the case of the Scottish Bill, especially because as it stands the Bill does not really make sense. This subsection now refers to undertakings which the Agency "control", but by other Amendments which we made at the Committee stage we ensured that the Agency did not control any undertakings. So that in the interests of the Bill's making sense and of bringing it into line with what we already have in the Scottish Bill, I urge your Lordships to accept this Amendment.
This Amendment seeks to replace the words "industrial democracy" with words which seem to us to give a more precise meaning of what we think should be the function of the Agency. When the matter was first considered in the House on the Scottish Bill on 10th June, many of your Lordships in all parts of the House expressed dislike of the term "industrial democracy" for various reasons. The noble Lord, Lord Taylor of Gryfe, went so far as to say that it could be dangerous to use such a term, when to many trade unionists it involves a degree of workers' control.
As a result of that debate the noble Lord, Lord Hughes, who objected to this Amendment on that occasion, went on to say:
" I would prefer what is in the Bill as it stands, but if the noble Lords could get together and draw up something which fits tidily into the Bill as it stands, I will not oppose it at the next stage."—[Official Report, 10/6/1975, col. 176.]
We did get together, we produced the present Amendment at the Report stage, the noble Lord, Lord Hughes opposed it, but after a short debate—in which, again, the vagueness and lack of definition of the words "industrial democracy" was heavily criticised—the matter went to a Division and it was carried by 90 votes to 49. I now ask the House to include the same Amendment in the Welsh Bill, so that the two Bills may go forward to another place in harmony at least on this one point, and making sense.
The reason for the Amendment was fully argued in the previous debates and have not very much to add. I would say only that the term "industrial democracy" is hopelessly ill-defined and can mean anything to anybody. To some it means workers' control; to some it

1309
means postal ballots within unions for union elections; for others, as The Times pointed out yesterday, it includes employee participation in the affairs of local councils, and yet others would water it down to the bare minimum of consultation. It is a concept that is hardly appropriate to a legal document and, in my view, it would have been much better left out altogether and confined to a code of practice. However, it is in the Bill and, if we are to include something of this sort in it, then let us be clear what we mean. The Amendment is at least a reasonable attempt to do this. It may not be the last word; it can be debated in another place, it can be altered if necessary. But I commend it to your Lordships as preferable to the words at present in the Bill. I beg to move.
Lord CACCIA: My Lords, this has been discussed earlier, but I should like to say one word in support of the views then put forward by the noble Lord, Lord Taylor of Gryfe, and reiterated today by the noble Lord, Lord Aberdare. Even if these words do not finally remain in the Bill after it has been considered in another place, I submit that the present wording containing the words "industrial democracy" are shorn of almost any precise meaning and should not form part of any legislative Act by this Parliament. Perhaps in considering this in another place, at least, the limerick might be kept in mind about the young girl of Boulogne,
" Who sang a most topical song;
It wasn't the words that frightened the birds,
But the horrible double entendre."
The LORD CHANCELLOR: My Lords, I regret that I cannot cap the utterance of limericks without the potential risk of embarrassment to noble Baronesses in the House. However, I regret that I cannot accept the blandishments of the noble Lord, Lord Aberdare, moderately as he has put the case for the words proposed in the Amendment, the effect of which would be to remove the Agency's function of promoting industrial democracy in undertakings which they control and replacing this with the form of words shown in the Amendment. We had a full discussion in the House on this subject during the Report stage of the Scottish Development Agency (No.
1310
2) Bill, and there was a parallel Amendment to the Bill on the same day which, for convenience only, was withdrawn by the noble Lord, although the noble Lord, Lord Aberdare, gave notice that he would return to the matter—as he has done—on Third Reading.
I have already indicated the reasons why the Government are not able to accept this Amendment. They take the view that the phrase "industrial democracy ", admittedly broad, provides for the kind of flexibility that will be needed in the various undertakings for which this Agency will be responsible, and that it describes more effectively than what is proposed in the Amendment the kind of participation by the representatives of the whole work force in decision-making in industry which is contemplated. It indicates that it means the involvement of all those within industry and responsibility for those whose lives and work are invested, as well as for those whose money is invested. But I am afraid that at this late hour on this warm afternoon it is unlikely that the process of conversion will go very far. We shall try, and I regret that we shall have to invite the House to divide upon this matter.
Lord OGMORE: My Lords, if I may be allowed to say a word here, I see some problems in allowing this to go forward as it is. I quite understand that the purpose of the Amendment of the noble Lord, Lord Aberdare, is different from that of the noble and learned Lord the Lord Chancellor. The noble and learned Lord wants to go much wider than the noble Lord, Lord Aberdare. But the fact is that the House will send two Bills to another place, one relating to Scotland and the other to Wales. As I understand it, there are two subsections which are not in line one with another, because one will contain what the noble and learned Lords wants, and the other will contain what the noble Lord, Lord Aberdare, wants. In other words, another place—if they take any notice of what we are doing here—will be in some confusion. We have a very good reputation, so we ought perhaps to resolve this difficulty, and choose one thing or the other.
Of the two, I think I would agree with the noble and learned Lord. Most of us know by now what is meant by the words "industrial democracy ", whether or not

1311
we agree with them. They are words in common usage. Even in an Act of Parliament one should not always reject modern usage. One should occasionally come up to scratch and use modern terms, so I do not object to that. However, I do object to going forward with two Bills on the same hot afternoon, which are quite different, and sending them to another place. I do not know the answer, but no doubt it can be ironed out in another place if we pass them this afternoon.
Lord WYNNE-JONES: My Lords, I find myself frequently in agreement on matters concerning Wales with the noble Lords, Lord Aberdare and Lord Ogmore. On this occasion, however, I find it a little difficult to understand exactly why this proposal is made. If it is made so that we in Wales should fall neatly behind what is done in Scotland, that is one point of view. I have never myself felt that in any particular field, even including the Rugby field, that we in Wales should necessarily follow behind Scotland. There are many occasions when we may go a little in advance of Scotland.
I should have thought that the term "industrial democracy" was a very good and appropriate one, and one to which we ought to stick. We have always believed in democracy in Wales. I think Scotland has only intermittently believed in it! I should think that the term "industrial democracy" was completely clear, and was a term which would appeal to anyone who was grounded in Wales. I am a little surprised that the noble Lord, Lord Ogmore, does not feel that. Indeed, I am very surprised that the noble Lord, Lord Aberdare, does not feel that, I should have thought we would accept this.
Lord OGMORE: My Lords, perhaps I did not make myself very clear. I did in fact support the Amendment of the noble and learned Lord the Lord Chancellor, rather than the other.
Lord ABERDARE: My Lords, I do not think we shall ever convert each other on this matter. It would be better to take the advice of the noble and learned Lord the Lord Chancellor and come to a decision. But before we do. I have two comments to make, first of all upon what the noble Lord, Lord Ogmore, said. I would remind him again that on the occasion when this Amendment was moved in the Scottish Bill it was supported by the Liberals, so presumably the Liberal Party are divided on this issue. They supported us in the Lobbies on the occasion of the Scottish Bill.
The second point I wish to make arises from what was said by the noble Lord, Lord Wynne-Jones. We are not following Scotland in this matter. In the case of the Scottish Bill, the House took the view that it was better to try to find some form of words to express more accurately what was meant by the term, "industrial democracy ". Whereas I agree with the noble Lord that "democracy" is readily understandable, I do not agree with him that any two people necessarily agree on what "industrial democracy" means, and I tried to explain that in moving the Amendment. It would look odd if the House took one view on one Bill and now sought on another Bill altogether to take another view. We had better decide this matter on a Division.
On Question, Whether the said Amendment (No. 3) shall be agreed to?
Their Lordships divided: Contents, 86; Not-Contents, 68.

CONTENTS

Aberdare, L.

Cottesloe, L.

Emmet of Amberley, B.

Amory, V.

Cowley, E.

Erskine of Rerrick, L.

Ashbourne, L.

Craigavon, V.

Falkland, V.

Auckland, L.

Crathorne, L.

Forester, L.

Balfour of Inchrye, L.

Crawshaw, L.

Gainford, L.

Berkeley, B.

Daventry, V.

Greenway, L.

Buccleuch and Queensberry, D.

de Clifford, L.

Grenfell, L.

Caccia, L.

Denham, L. [Teller.]

Gridley, L.

Campbell of Croy, L.

Derwent, L.

Grimston of Westbury, L.

Carrington, L.

Drumalbyn, L.

Halsbury, E.

Cathcart, E.

Ebbisham, L.

Hanworth, V.

Clifford of Chudleigh, L.

Eccles, V.

Hawke, L.

Colyton, L.

Elliot of Harwood, B.

Home of the Hirsel, L.

Cork and Orrery, E.

Elton, L.

Hood, V.

Hornsby-Smith, B.

Mowbray and Stourton, L. [Teller.]

Somers, L.

Howe, E.

Stamp, L.

Kindersley, L.

Nugent of Guildford, L.

Strang, L.

Lauderdale, E.

Onslow, E.

Strange, L.

Long, V.

Porritt, L.

Strathcarron, L.

Loudoun, C.

Rankeillour, L.

Strathcona and Mount Royal, L.

Lovat, L.

Redesdale, L.

Lucas of Chilworth, L.

Roberthall, L.

Strathspey, L.

Lyell, L.

Ruthven of Freeland, Ly.

Terrington, L.

Macleod of Borve, B.

Sackville, L.

Tranmire, L.

Macpherson of Drumochter, L.

St. Aldwyn, E.

Tweedsmuir, L.

Mancroft, L.

St. Helens, L.

Vivian, L.

Mansfield, E.

St. Just, L.

Wakefield of Kendal, L.

Merrivale, L.

Sandys, L.

Ward of North Tyneside, B.

Morris of Borth-y-Gest, L.

Sempill, Ly.

Wolverton, L.

NOT-CONTENTS

Airedale, L.

George-Brown, L.

Pitt of Hampstead, L.

Amherst, E.

Gordon-Walker, L.

Platt, L.

Ardwick, L.

Hale, L.

Rhodes, L.

Arwyn, L.

Harris of Greenwich, L.

Richie-Calder, L.

Aylestone L.

Henderson, L.

Rusholme, L.

Banks, L.

Hughes, L.

Sainsbury, L.

Beaumont of Whitley, L.

Jacques, L.

Samuel, V.

Blyton, L.

Kimberley, E.

Seear, B.

Brockway, L.

Lee of Newton, L.

Segal, L.

Bruce of Donington, L.

Llewelyn-Davies of Hastoe, B.

Shepherd, L. (L. Privy Seal)

Buckinghamshire, E.

Lloyd of Hampstead, L.

Stedman, B.

Burntwood, L.

Lloyd of Kilgerran, L.

Stewart of Alvechurch, B.

Byers, L.

Longford, E.

Strabolgi, L.

Castle, L.

Lovell-Davis, L. [Teller.]

Summerskill, B.

Champion, L.

Lyons of Brighton, L.

Wade, L.

Chorley, L.

Melchett, L.

Wallace of Coslany, L.

Clancarty, E.

Morris of Grasmere, L.

Wells-Pestell, L. [Teller.]

Collison, L.

Noel-Buxton, L.

White, B.

Darcy (de Knayth), B.

Ogmore, L.

Wigg, L.

Douglas of Barloch, L.

Paget of Northampton, L.

Wigoder, L.

Elwyn-Jones, L.

Pennell, L.

Willis, L.

(L. Chancellor.)

Peddie, L.

Winterbottom, L.

Foot, L.

Phillips, B.

Wynne-Jones, L.

On Question, Amendment agreed to.

Resolved in the affirmative, and Amendment agreed to accordingly.
Clause 5 [Power to form committees.]
4.33 p.m.
Lord LOVELL-DAVIS: My Lords, we have looked again at the drafting of the subsection in the light of the comments expressed by the noble Baroness, Lady White, and the helpful intervention of the noble Lord, Lord Aberdare. I am sure that the Secretary of State and the Chairman would in all cases want to consult and exchange views on the appointment of members of the Agency to Committees. However, in order to meet the points made we have brought forward this Amendment, which limits the requirement of the Secretary of State's approval to persons who are not members of the Agency. I hope, therefore, that this Amendment will commend itself to your Lordships. I beg to move.
Amendment moved—
Page 4, line 42, leave out from (" Agency ") to end of line 43 and insert (" and may be
1314
either members of the Agency or, with the approval of the Secretary of State, persons who are not members.").—(Lord Lovell-Davis.)
Baroness WHITE: My Lords, I am glad once more that my noble friends have paid some attention to expressions of opinion in your Lordships' House. There are a good many manifestations of "Nanny knows best" in this Bill, but at least this Amendment removes the most obnoxious of them, and I welcome it.
Lord ABERDARE: My Lords, I should like to say thank you to the noble Lord, who acknowledged that I made a suggestion. I am very grateful.
Clause 10 [Selective financial assistance.]
Lord ELTON Lord ELTON moved Amendment No. 5:
Page 6, line 28, at end insert—
(" ( ) Any direction given under this section shall be reported immediately to the House

1315
of Commons in terms agreed with the directors of the company seeking assistance.").
The noble Lord said: My Lords, I have tabled this Amendment, honouring my undertaking so to do at the last stage of this Bill. The arguments in favour of it have been adduced two or three times now, and I will not weary your Lordships with a recapitulation of them. I would remind your Lordships that Amendment No. 5 was greeted with some favour on all sides of your Lordships' House, and I detected a certain atmosphere of incipient semi-approval on the Benches opposite and from the Woolsack. The noble and learned Lord said that it might not be possible to pronounce upon this matter yet but that we should seek an opportunity for him to do so, if possible, now. I understand that if he is not able to do so it is because we are awaiting a judgment, as it were, on the larger Bill which is travelling on adjacent rails in the opposite direction from the other place. Many analogies about menus in restaurant cars on railways spring to mind. It is a confusing and not altogether satisfactory situation, but I think your Lordships will agree that we should bear with it and listen with interest to what the noble and learned Lord has to say. I beg to move.
The LORD CHANCELLOR: My Lords, I indicated at both Committee and Report stages that the Government were giving sympathetic consideration to methods and timing of publication of directions and to the degree of detail. I also said that it might not prove possible to make a conclusive statement at the time of Third Reading, and, as the noble Lord has indicated, the reason is that we have to take account of comparable arrangements in respect of both the Scottish Agency and the National Enterprise Board. I regret that I cannot be more definite at this stage, but, as noble Lords on all sides of the House will recognise, this is an important issue and it may well take a little time to resolve it fully.
The basic task is to strike the right balance between the demands of commercial confidence and the proper demands of public accountability. Clearly, for example, it is not always desirable on commercial grounds to give immediate publicity to all the details of financial assistance which may have to be
1316
given. I concede that the situation which I am indicating is not wholly satisfactory, but I hope that the noble Lord, Lord Elton, will recognise how far we are showing willing on this. On the understanding that further consideration will undoubtedly be given in another place to the matter, I hope that, however reluctantly, he will agree to withdraw his Amendment.
Lord ELTON: My Lords, as I indicated at the outset, we do not want to embarrass or harass Her Majesty's Government on this matter. I do not want to fall into the opposite pitfall of appearing out of solicitude to allow the impression that we do not feel strongly on this point. We do feel strongly, but we recognise the procedural difficulties which beset the noble and learned Lord and his Party. The most that I can do at this stage, therefore, is to ask that he should transmit to his colleagues in another place who are considering the other and bigger Bill that there is an intensity of feeling which would be consonant with a longer and more impassioned speech than I intend to deliver this afternoon. Having registered the dissatisfaction which we feel with the situation in which we all are, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord ELTON Lord ELTON moved Amendment No. 6:
Page 7, line 6, at end insert—
(" (14) The giving of any direction under this section by the Secretary of State shall not affect his obligation under section 7 of the Industry Act 1972 to secure the consent of a company before acquiring shares or stock therein.")
The noble Lord said: My Lords, I could say almost exactly the same about this Amendment also. I assume that the noble and learned Lord is in the same position on this Amendment as on the last. He is as aware of the feelings there are on these and on other Benches on this matter. May I, therefore, in moving this Amendment, ask him to reveal to your Lordships what progress, if any, has been made in the last few days on this matter? I beg to move.
The LORD CHANCELLOR: My Lords, on the last round I said that at the Report stage we might not be in a position to indicate today the way in

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which the Government propose to deal with this matter, and I am afraid that that forecast has proved accurate. I want to assure the noble Lord and the House that we have in no way gone back on the fact that we agree in principle with this Amendment. I therefore invite the noble Lord not to press his Amendment, bearing in mind the assurances that I have given previously and again today. Perhaps I may put the matter in this way: I invite him to do so on the clear understanding that when the Bill comes before the House again it will have been appropriately amended in another place. I have perhaps put the matter no more specifically than last time, but a similar intention applies to the previous Amendment as well.
Lord ELTON: My Lords, I am grateful to the noble and learned Lord for giving that undertaking and for giving it so clearly. Upon those grounds, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 20 [Powers of entry]:
4.41 p.m.
Lord LOVELL-DAVIS Lord LOVELL-DAVIS moved Amendment No. 7:
Page 12, leave out lines 12 to 18 and insert—
(" (6A) It shall be the duty of a person exercising powers conferred by this section—

(a) to take reasonable care to avoid injury to plant, machinery, equipment, livestock, crops or enclosures, and

(b) on leaving any land, to secure it as effectively against unauthorised entry as he found it.

(6B) Any reference to land in the foregoing provisions of this section includes a reference to buildings or other structures on land.")
The noble Lord said: My Lords, we have looked again at subsection (6) in the light of the Amendments tabled by the noble Lord, Lord Elton, at Report stage. The noble Lord will recall that the Government accepted an Amendment which he had tabled to add at the end of subsection (6) the words:
" and while entering upon, surveying or leaving agricultural land or premises shall take reasonable care to avoid causing unnecessary harm or disturbance to livestock, crops or enclosures ".
Furthermore, we accepted in principle another Amendment to insert the words "land or" before the first reference to "premises" in the subsection, but pointed
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out that a further two Amendments would be required to get the wording right. The Government undertook to table those Amendments. I should explain that Lord Elton's arguments caused us to look again at the subsection as a whole. We decided that there were further changes which ought to be made and this explains why we have not brought this Amendment forward in quite the form which might have been expected. I very much hope, however, that the noble Lord will agree that we have not only met his points but gone well beyond them.
I will now explain what we have done, and why. First, the opening words of the subsection:
" A person entering upon any land by virtue of this section may take with him such other persons as may be necessary ",
are unchanged. Second, in order to meet the noble Lord's point that the provision should refer explicitly to land and to premises we have, in (6B) stated clearly that:
" Any reference to land in the foregoing provisions of this section includes a reference to buildings or other structures on land".
Third, we have decided that it would be right to extend the range of items which reasonable care should be taken to avoid unnecessary harm or disturbance to. Thus we have added "plant, machinery and equipment" to "livestock, crops or enclosures ". Incidentally by not making specific reference to the words "agricultural land" we have extended substantially the land to which the subsection applies—industrial and commercial land for example. Fourth, we have used the term "injury" instead of "harm and disturbance ". I am assured by my legal advisers that it is a more accurate legal term to cover both harm and disturbance. Fifth, we realised that we ought to avoid the distinction between occupied and unoccupied premises. The previous draft imposed an obligation to leave premises secured against unauthorised entry only when they were unoccupied or when the occupier was temporarily absent. The fact that, for example, a farm is occupied should not exonerate those authorised to enter from shutting the gates. This we have sought to put right. I very much hope that what I have said will be found to be both helpful and acceptable to the House. I beg to move.
Lord ELTON: My Lords, I am grateful to the noble Lord for the work he has done in improving this subsection more effectively than my own Amendment would have done. We are grateful for this and acknowledge it. Very quickly, in passing, I should like an assurance on the numbering of the clause. I think that if the numbering is not correct it can be altered without Parliamentary procedure. We have two lines of the original subsection (6) standing, and it is not clear to me whether (6A) is a new subsection to be inserted after (6), or whether (6A) stands as a subsection of (6). I do not want to use up the time of your Lordships' House over this small matter if it can be put right outside the Chamber. On the other hand, if this is the last opportunity to avoid a damaging misprint I should like to draw it to your Lordships' attention. Certainly the intention of this Amendment is one which is welcome to us.
Lord LOVELL-DAVIS: My Lords, I shall certainly look into this and ensure that it is made absolutely clear. As I understand, it is (6), (6A) and (6B), but I will make absolutely sure that this is stated in such a way that there can be no question of doubt as to its meaning.
Lord ELTON Lord ELTON had given Notice of his intention to move Amendments No. 8, 9, and 10:
Page 12, line 12, after ("any") insert (" land or ")
Page 12, line 13, after (" unoccupied ") insert (" land or ")
Page 12, line 13, after (" or ") insert (" land or ")
The noble Lord said: My Lords, this ground has been covered and met by the previous Amendment, therefore I beg leave not to move Amendments Nos. 3, 9 and 10.
The LORD CHANCELLOR: My Lords, I beg to move that the Privilege Amendment be agreed to.
Moved, That the Privilege Amendment be agreed to.—(The Lord Chancellor.)
4.47 p.m.
The LORD CHANCELLOR: My Lords, I beg to move that this Bill do now pass. There are one or two matters agreed to.
On Question, Privilege Amendment
which have arisen during the progress of the Bill through this House about which my noble friend Lord Lovell-Davis and I undertook to make the position of the Government clear before the Bill left the House. At the Committee stage, on the Question that Clause 1 stand part, my noble friend Lord Lovell-Davis gave an undertaking to the noble Lord, Lord Aberdare, that there would be a statement at Third Reading about the relationship between the Development Agencies and the National Enterprise Board. My noble friend Lord Hughes has today made a long and detailed statement about this matter in relation to the Scottish Agency and the National Enterprise Board, and I do not think in the circumstances that I need say more at this stage than that of course we will seek to follow the same broad principles in Wales. I hope that publicity that may be given in Wales to this statement of the broad principles will allay some of the fears, and, I think, misapprehensions, that have arisen with regard to this matter.
During the Committee stage the noble Lord, Lord Elton, raised the matter of exempting certain tenants from the certificate procedures referred to in Clause 9, which is a highly technical matter. Complicated matters of both substance and drafting are involved in any proposal to exempt certain tenants from the certificate procedure. Any changes proposed would need to be considered in relation to other comparable legislation. Nevertheless, we have agreed to review the clause, and I can give an assurance to the noble Lord that consideration will follow in another place. I hope that he will be content not to pursue that high technicality at this stage.
During the Report stage of the Bill last week, my noble friend Lady White moved an Amendment which would have had the effect of adding "local government to the areas of experience which should be taken into account by the Secretary of State in making his appointments to the Welsh Industrial Development Advisory Board. As your Lordships will know, I resisted the Amendment at that stage but promised to look at the proposal in more detail to consider its implications. This I have done, and it is with some regret that I have to say that I must continue to resist the suggestion that was made.
While the Government accept that the work of the Board has an impact on local government affairs, I emphasise that its work is the highly specialised work of financial appraisal. Experience has shown that people with the specified qualifications are the most valuable to the efficient working of the Board. My noble friend in making her plea said that local authorities in Wales realise that they have no absolute claim for a place on the Advisory Board, but that they wish that their membership should at least be considered when appointments are being made. I therefore take this opportunity to give the assurance that as the list of qualifications in subsection (3) is not exclusive, the Secretary of State can consider and appoint to the Board people from backgrounds other than those listed where of course he considers that their experience is relevant to its highly specialised working.
The noble Lord, Lord Elton, sought some clarification of how the Secretary of State stands vis-à-vis other Ministers of nationalised industries in relation to the transfer of publicly-owned property. He also commented that the consent of the Secretary of State to the transfer of such property to the Agency is not subject to Parliamentary supervision. There is no question whatever of the Secretary of State having a right to disregard the responsibilities of other Ministers concerned with any of the other nationalised industries, however big or small. All transfers of publicly-owned property will be subject to administrative arrangements between the Secretaries of State concerned and there will be the fullest consultations between them. It is the Government's view that the appropriate means of Parliamentary control over the public investment in any property transferred should be through the Select Committee on the Nationalised Industries and, where appropriate, the Public Accounts Committee. There is no reason why the Agency, when carrying out this function of managing publicly-owned property, should be in any way different from any of the nationalised industries. We are considering whether there should be an Amendment requiring Parliament to be informed of transfers of publicly-owned property; as a consequence of Parliament being informed, the Secretary of State would, of course, be subject to normal Parliamentary account-
1322
ability for his action and there could be a debate if it was seen to he a matter of importance.
I apologise for speaking at length at this stage, but before concluding I wish to express the gratitude of my right honourable and honourable friends for the help that has been given in the hastening of this valuable Bill for Wales through the House. In particular, I thank the noble Lord, Lord Aberdare, and the noble Lord, Lord Elton, and also the noble Lord, Lord Ogmore, from the Liberal Benches. I thank them for the valuable assistance that they, along with my noble friend Lady White, have given in the careful examination of this Bill. Clearly some of the Amendments that were passed were contrary to the views of the Government on them, and it may well be—I think I am putting it moderately if I put it in that way—that the Bill will return to the House from another place with what we regard as those errors suitably corrected. Having said that, I hope not too ungenerously, I readily recognise that a number of other Amendments have been agreed to on the initiative of noble Lords from each side of the Committee and we are grateful that the common purpose between us of doing what we regard as the best for Wales and the Welsh people has been furthered by our deliberations.
Moved, That the Bill do now pass.—(The Lord Chancellor.)
Lord ABERDARE: My Lords, we are grateful to the noble and learned Lord on the Woolsack for having given us various assurances and statements in response to questions we raised at earlier stages, and we will read carefully in the Official Report the more detailed statements that were made by the noble Lord, Lord Hughes, at the end of our deliberations on the Scottish Development Agency Bill. I accept that we have had one or two major differences of policy, arising mainly out of the shadows or foreshadows of the Industry Bill; but I agree with the noble and learned Lord that we have made some valuable Amendments to the Bill, and I and my colleagues wish to express our gratitude to the noble and learned Lord and to the noble Lord, Lord Lovell-Davis, for the care and sympathy with which they have viewed many of our Amendments.
We have also seen the astonishing feat performed today by the Liberal Party of

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reinforcing their centrist views by voting against an Amendment on this occasion, on 24th June, when they supported it on 19th June. Both the noble Lord, Lord Lloyd of Kilgerran, and the noble Lord, Lord Ogmore, whose views on Wales we usually respect, have now voted both ways, once on a Scottish Bill and once on the Welsh Bill, and I have found this an astonishing performance. Perhaps we could compare the Liberal Party to the mugwump, which sat on a fence for so long with its mug on one side and its wump on the other that the iron entered into its soul.
Lord BYERS: My Lords, that was said about the National Liberal Party, an associate of the Conservatives.
Lord ABERDARE: I am afraid that it has been inherited by the Liberal Party, my Lords. This was an astonishing achievement quite unique in my experience. However, I would not like to conclude on that note but on one of gratitude for the co-operation that has been shown in the course of the deliberations on this Bill.
Lord OGMORE: My Lords, I wish to express gratitude on behalf of myself and noble Lords on the Liberal Benches to the noble and learned Lord the Lord Chancellor, whose interest and sympathy for Wales are always very near his heart, and we would also thank the noble Lord, Lord Lovell-Davis, who I think has not appeared before in any Welsh debates. We are grateful to them and to the two noble Lords on the Conservative Benches who bore the heat and burden of the day, and I say that despite the remarks that were just made by the noble Lord, Lord Aberdare. The fact is, of course, that Liberals are always open to argument and conviction. They do not have closed minds nor closed mouths. Today, the Lord Chancellor persuaded us in the course of his argument that we had been wrong on the first occasion; that is why we altered our minds. I am sure that no noble Lord would want us to be so inflexible in mind that we could not react to a splendid entrée by the noble and learned Lord on the Woolsack.
On Question, Bill passed, and sent to the Commons.

SOCIAL SECURITY PENSIONS BILL
4.49 p.m.
Lord WELLS-PESTELL: My Lords, I beg to move that this Bill be now read a second time. This is the third major Bill to reform retirement pensions to be presented to Parliament in the last six years. The first, which was associated with the name of the late Richard Crossman, failed to complete its passage in another place and never reached your Lordships' House. The second, with which the noble Lord, Lord Aberdare, was associated when he was on the Government Benches, became the Social Security Act 1973. Speaking personally, I am delighted that the noble Lord will be taking part in the passage of this Bill because we welcome his skill and experience.
I am glad to be able to commend a Bill which comes to your Lordships' House after an unopposed passage through another place, during which the constructive approach of the Opposition led to a number of improvements. It is extremely important to achieve and keep a consensus on these matters and we know that the pension interests are entirely with us in this aim. Again, if I may say so without being invidious, I am glad that the noble Lords, Lord Byers and Lord Banks, both of whom have considerable expertise in this subject, will be giving us the benefit of their experience.
The Bill is based on the Government's White Paper, Better Pensions, published last September. Though it is relatively simple in concept, its details are complex—particularly as it amends, rather than replaces, existing legislation. That legislation was recently consolidated into the Social Security Act 1975, and it is that Act which the Bill refers to as "the principal Act ". Much of the basic framework of the 1975 Act, and in particular the system of earnings-related contributions introduced in April of this year, remains essentially unchanged, but the Bill introduces earnings-related pensions in place of the mainly flat-rate benefits which have been traditional in our concept of national insurance.
The scheme introduced by the Bill is essentially a partnership between, on the one hand, the State pension for retirement

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pensioners, and on the other, occupational pensions schemes. Let me deal first with the provision for those people—still a majority of workers—who are outside good occupational schemes and who look for their pension cover entirely to the State scheme. The benefits on retirement, widowhood and invalidity, will be linked to the contributor's previous earnings. They will be in two parts—a basic component and an additional component. The basic component will represent a pound for pound replacement of the first £11·60 of earnings in present day terms. As your Lordships will know only too well, £11·60 is the level of the current fiat-rate pension.
The basic component of the new scheme will be the flat-rate pension in force when the scheme starts. The additional component will represent 1¼ per cent. of earnings above £11·60 and up to a ceiling of seven times that figure—in excess of £80 a week in 1975 terms—for each year of contributions to the new scheme. The figure of 1¼ per cent. may sound unfamiliar, but in fact it is equivalent to the "eightieths of salary per year of service "which is a common formula in occupational pension schemes of the "final salary" type, and which is embodied in the conditions for contracting out.
After the scheme has been in operation for 20 years, the additional component will represent a 25 per cent. return on the band of earnings between the lower earnings limit and the ceiling of just over £80 which I have just mentioned. Thereafter, there will be no addition to the figure of 25 per cent. but that percentage will be based on the relevant earnings in the contributor's best 20 years. One major feature of the scheme is its protection of pensions against the ravages of inflation. The actual earnings on which pensions will be calculated will be revalued in terms of the general earnings levels current in the last complete tax year of the contributor's working life. This revaluation will be carried out before the best 20 years are selected. Once a pension is in payment it will be reviewed at least annually, and the basic component uprated in line with the movement of earnings or prices—which-ever is more favourable to the pensioner. This follows the statutory provision which the Government have introduced for up-
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rating the present flat-rate pension. The additional component will be uprated in line with prices. I want to emphasise that. Graduated retirement benefit which is in payment under the scheme introduced by the Lord Boyd-Carpenter in 1961, together with the rights to graduated benefit of those who have not yet retired, will also be protected against increases in prices.
The Bill was presented in another place by my right honourable friend the Secretary of State for Social Services and it has appropriately been called a women's charter. It embodies a new deal for women, consistent with the Government's overall policy of bringing sex discrimination to an end. On the basis that women should assume equal responsibilities in return for receiving equal rights, there can be no place for a married women's contribution option in the new scheme. The present arrangements encourage the idea of women as dependants of their husbands who—irrespective of their own employment history—can be adequately provided for at a lower level than men and single women. The Government believe that that is wrong and that working wives and widows should be encouraged to earn full benefits in their own right by paying full contributions.
Last October, the Government sought the views of various organisations representing the interests of employees, employers and women in general (including the TUC, the CBI and the Women's National Commission) as to the principle of abolishing the option and the best way of bringing it to an end. These consultations revealed substantial agreement that the option should be withdrawn but differing views on the way in which existing rights should be phased out. The Bill now before your Lordships therefore removes the option as a permanent provision of the national insurance scheme but contains wide regulation-making powers to accommodate whatever way of phasing out the option is finally chosen.
As your Lordships may know, the Government undertook to publish their views on the use of the regulatory powers, so that organisations could comment before final decisions were taken. A Memorandum, copies of which were placed in the Library, was sent to interested organisations and they were asked for their further views and comments by Friday

1327
last. The Government are now giving careful consideration to the comments which have been received before taking decisions on the way in which the regulation-making powers in Clause 3 of the Bill should be used. These regulations when presented will have to be approved by Affirmative Resolution of each House, so there will be ample opportunity for your Lordships to consider the matter in detail.
Apart from these transitional matters, women will from the start of the scheme pay the same rate of contributions as men with the same earnings and qualify for the same rate of benefit. Discriminatory rates of short-term benefits, and special rules such as the "half-test", will pass into history. However, the pension which a woman can receive on her husband's contributions will remain, principally as a fall-back right for those who do not stay in paid employment for long enough to earn a full basic component on their own record of payments. A women entitled to benefit on both her own contributions and her husband's will be able to draw the larger of the two basic pensions and will, in either case, be entitled to any additional component which she herself has earned. On retirement a widow will be able to draw both her own earnings-related pension and that to which she is entitled by virtue of her husband's contributions, although she will not be able to receive more than one basic component which, as I have already stated, is £11·60 at present; nor will she be entitled to draw more in total than the maximum pension payable under the scheme to one contributor.
Although it is somewhat overshadowed by the improvements for women, the Bill also extends pension cover for men, in that it introduces the concept of a widower's pension on his late wife's contributions. Where the wife in a pensioner couple dies, the widower will be able to inherit her pension entitlement, subject to the same limits and the same maximum as I have described as applying to widows. Also, a man of working age who is ill when his wife dies, or who falls ill shortly after her death, and who qualifies for invalidity pension because his incapacity has lasted six months or more, may have this calculated
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on his wife's record, if her record is better than his own.
Another new concept introduced by the Bill, which will primarily be of help to women but will certainly also benefit some men, is that of recognising home responsibilities. The Bill ensures that a person who stays at home to bring up children or care for a sick or elderly relative, will have his or her pension rights safeguarded. Though it will be necessary for a person to contribute for twenty years in order to qualify for a full pension, this provision means that a woman may spend as much as half her adult life away from work coping with her family responsibilities without jeopardising her right to a pension based on twenty years' earnings. Exactly how these arrangements will work, and the details of the circumstances in which pension rights will he protected by reference to home responsibility, will be set out in regulations which will come before your Lordships in due course. This is another matter on which your Lordships will be able to consider the details. In addition to the improved earnings-related invalidity pensions payable to disabled workers, the conditions for receipt of invalidity allowance, which depends on the age at which the pensioner becomes incapable of work, are eased. The maximum rate will become available to men and women who fall sick before age forty, and thus will not generally have been able to pay the twenty years' contributions necessary for a full pension under the new scheme.
My Lords, before I leave the subject of the provision made in this Bill for the chronically sick and disabled, I want to speak for a few minutes about a new benefit which was added to the provisions of the Bill before it left another place, and was welcomed there by both sides of the House. I refer to the mobility allowance. The broad outlines of this new benefit were announced in a Government Statement on 13th September last year, but the further detailed work necessary meant that it was not possible to table legislation until the Report stage of the Pensions Bill in another place. There is no very obvious consanguinity between the mobility allowance and the neighbouring provisions in the Pensions Bill, but the aim has been to seek legislation on a timetable which will make it possible

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for the new benefit to begin to come into operation in January 1976, which is almost on us. The Pensions Bill represented the only opportunity of achieving this. Given the nature of the allowance, and the solid reasons for introducing legislation now, I am confident that your Lordships will consider that this was the right way of proceeding.
The genesis of the mobility allowance goes back to the considerations which followed the publication last year of the report Mobility of Physically Disabled People produced by the noble Baroness, Lady Sharp. The views expressed by interested bodies and Ministers' own feelings about the best way of making progress led to the conclusion that the primary emphasis in mobility help should be not on hardware, but on cash—cash providing a greater degree of flexibility, and enabling provision to be made for those people unable to walk, who were neither able nor willing to drive a car themselves, nor had anyone readily available to drive it for them. It is perhaps natural, given the origins of the vehicle service, and given the fact that it has hitherto stood alone, that interest should have been focused chiefly on the disabled driver. However, mobility problems are much wider than this, and any solution which was focused solely on hardware and solely on the disabled driver would be only a very partial solution, and not altogether a satisfactory or fair one.
The mobility allowance provided for in the Bill now before us is a £5 a week taxable allowance for disabled people of working age and children aged five or over who are unable, or virtually unable, to walk. Many of your Lordships will recall that the September Government Statement envisaged an allowance of £4, and a substantial improvement has therefore been made between the announcement and the presentation of legislation. For those who qualify for the allowance, the three-wheeled invalid vehicle will continue to be available as an alternative. More important, however, the allowance will be available to perhaps 100,000 severely disabled adults and children for whom the existing vehicle arrangements provide no help whatever and can, by their nature, provide no help. In the present difficult situation, mobility allow-
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ance marks a very real and very important advance in our view, and although I recognise that criticisms have been, and no doubt will be made, regarding the limitations on what has been done, I am very happy to commend the Government's proposals to your Lordships for the very great deal that they achieve.
My Lords, I shall now return to the main structure of the Pensions Bill, and say something about the cost of these proposals, and how they are to be paid for. Even without any of the improvements which the Bill contains, the cost of the national insurance scheme is now running at about £6,500 million a year, some five-sixths of which is financed by contribution income and the remainder by a subvention from general taxation.
The contribution rates which came into force in April represented 14 per cent. of the earnings of employees up to the scheme's upper limit, divided so that the employee himself pays 5½ per cent., and his employer pays 8½ per cent. The Bill, as your Lordships will see from the Explanatory and Financial Memorandum on the front of it, provides for these contributions to go up by 1 per cent. for employees and 1½ per cent. for employers; in other words, to 6½ per cent. and 10 per cent. respectively. However, those figures are provisional, and Clause 2 of the Bill requires the Secretary of State to review them and to report back to Parliament before the scheme comes into force. The Government's intention is that the initial rate of contribution should be at a level which will keep the scheme's finances in balance for a number of years, but the Government Actuary's forecasts suggest that its emerging cost will mean a contribution increase of ½ per cent. after 10 or 15 years and that, by the time it has been in operation for 30 years, a joint contribution rate of between 18 per cent. and 18½ per cent. will be required.
By that time, as the Memorandum on the front of the Bill indicates, the cost of National Insurance will have risen, in 1975 terms, from £6,500 million to between £8,500 and £9,000 million a year. This increase in expenditure is a measure of the extent to which the Bill will improve the living standards of the retired, the widowed and the sick. There

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will, as a result, be savings in supplementary benefit which will be achieved as the number of people who need supplementary benefit because they cannot at present manage on their contributory pensions steadily falls.
So far I have described the new contributions and benefits solely as they will affect people who are primarily dependent on the State for their pension provision. But a crucial feature of the new scheme as I explaned in my opening remarks, is a new concept entirely—the concept of a partnership which it brings about between the State and good occupational schemes. This brings me to the feature of the Bill which has given rise to the greatest amount of comment, both in another place and in the Press; namely, the facility which it contains for contracting out of part of the State scheme for those who are members of good occupational schemes, though I should make it clear that much of the State provision, such as full cover for earnings-related invalidity pension, partial cover for widowhood, and the State's guarantee of price-protection, will be available to the contracted-out, even though they look to an employer's scheme as their primary source of personal retirement pension. I hope I am right about that.
The Bill provides that it should be open to employers with good occupational pension schemes to contract their members out of the full State scheme and thereby to take over responsibility for a part of the pension that would otherwise be provided by the State. In return, both the employer and the employees concerned will receive a reduction in their contributions to the State scheme. The conditions for contracting-out are based upon two principles: first, that occupational schemes should not be asked to do something which, by their nature, it is not possible for them to do; and second, that the position of the individual pensioners should be safeguarded by providing that they should be no worse off on account of contracting-out. As a result of this approach a large measure of agreement was reached over the contracting-out provisions in another place. I am confident that in this House there will be a similar constructive approach to the Bill, and I turn now to the general outline of the contracting-out provisions.
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There will be no provision for contracting-out of the State pension scheme on the lowest band of earnings (the slat rate pension of £11½60 in the Bill), which count towards the basic component, but employers will be able to contract out of the additional component which is based on earnings between £11½60 and the scheme's upper earnings limit of just over £80 a week. The two main conditions that an occupational pension scheme will have to satisfy in order to contract out are, first, that it must provide personal pensions, based on final salary or average salary revalued in line with the growth of earnings generally, available not later than age 65 for men and 60 for women, with an annual accrual rate equivalent to at least 1/80th of pensionable salary—which equals the 1¼ per cent. accrual rate to which I have already referred. For widows a pension must be provided equal to at least half of the husband's pension at the time of his death. Secondly, the pension of each scheme member must be not less than a minimum—known as the guaranteed minimum pension—at least equal to the pension he has forgone in the State scheme. For widows the scheme must provide a guaranteed minimum of at least half the husband's guaranteed minimum pension at the time of his death. I should add that in calculating the guaranteed minimum, occupational schemes are not being asked to match the "best 20 years" provision. Liability for that will remain with the State scheme.
Where members leave a contracted-out scheme after less than five years of contracted-out service, or where a scheme ceases to be contracted-out or has to be wound up, there are arrangements for the scheme to reinstate—or "buy back"—members into full State pension entitlement by means of the payment of a premium to the State scheme. Whether or not a scheme can be contracted-out will he a matter for determination by the Occupational Pensions Board set up under the Social Security Act 1973, and the Board will also exercise supervision over the funding and solvency of contracted-out schemes.
Both members of contracted-out pension schemes and their employers will pay a reduced contribution to the State scheme on the upper band of earnings. The Government's White Paper proposed

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that the reduction should be 6½ per cent., which was the neutral figure set by the Government Actuary. However, in recognition of the risks that employers would be taking, and on which the occupational pensions interests have laid great emphasis, the Government decided that the reduction should be increased to 7 per cent. This was one of the concessions made during the period between the publication of the White Paper and the publication of the Bill.
After the publication of the White Paper, representations were made to the Government about the requirement on employers to revalue the guaranteed minimum pensions of early leavers in line with the general movement in earnings. The requirement was to ensure that when the early leaver reached pensionable age, his contracted-out preserved pension would not have lost its value in relation to the pension which he would have received from the State had he not been contracted-out. However, comments made suggested that employers would be discouraged from contracting-out unless they could know what their commitments for early leavers were at the time they left. A variety of proposals was put to the Government for limiting the commitment of employers to revalue pension rights for early leavers. The Government came to the view that of the proposals put to them the most satisfactory was that which now appears in the Bill; that is, to give schemes the option of choosing to limit revaluation for their early leavers to 5 per cent. per annum and to pay a premium to the State scheme at the time of leaving, in return for which the State scheme would take over the balance of revaluation over 5 per cent.
Noble Lords may also be aware that pensions interests have been greatly concerned about what has been termed the open-ended commitment that would be undertaken by contracted-out employers who would have to revalue guaranteed minimum pensions in line with the general movement in earnings, since there would be a requirement to pay State scheme premiums where a scheme ceased to contract-out on the basis of this open-ended revaluation. The Government accepted that the Bill needed to be amended on this point and changes were accordingly made to the Bill at the Report
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stage in another place. The result is that when a scheme ceases to be contracted-out, an employer may elect to pay a premium on the basis that for each of the last five years the accrued rights had been based upon revaluation at a fixed rate of 12 per cent. The effect is that employers will know the maximum extent of their commitments for a period of up to five years ahead, and the immediate effect of an upsurge of earnings on the employer's liability in respect of guaranteed minimum pensions will be limited. The Government also agreed that the premium tables will vary according to the yield on investments. This will assist schemes which have to realise long-term investments at perhaps an unfavourable time in order to pay "buy back" premiums to the State scheme.
My Lords, I hope I have said enough to give the House a general idea of the scope and provisions of this important Bill. Part I of the Bill relates to contributions. Part II sets out the earnings-related benefits which the State will provide and also the new mobility allowance. Part III deals with contracting out. Part IV deals with the right of women at work to enjoy the same access to occupational schemes as their male colleagues. Finally, Part V of the Bill is general and technical and contains, for example, the power to make rules governing the transition from the present scheme to the new one. It also empowers the Secretary of State to make Appointed Day orders bringing the pensions scheme into force. The Government's intention is that it should come into operation no later than 1978. The possibility of a 1977 start is under examination, but there are very considerable difficulties in the way of this and it would be wrong to be too optimistic about it. I do not think I can go further than that at present. A firm decision about the starting date will be announced in the autumn. As I said earlier, the Government are proposing a different timetable for the mobility allowance, which will begin to be phased in from January 1976.
The Social Security Pensions Bill is about partnership. Partnership between good occupational schemes, which will be helped by a contribution reduction to continue to provide the socially and economically valuable service which they already offer the community, and the

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national insurance scheme, which will offer those without occupational cover a State pension which bears comparison with the best the private sector can provide. Partnership between the generations, in that higher contributions by the working population will go to finance a steadily increasing standard of living for old people, and will bring to an end the situation in which millions of workers have to look forward to retirement in terms of an inadequate pension topped up by means-tested supplementary benefit. Partnership between men and women, exemplified not only by their equal status in the national scheme but by the improved range of benefits which will be available to the survivor of a marriage who has to cope in retirement or sickness on his or her own. And, finally, partnership between the more fortunate members of society who retain their health and faculties, and the sick or disabled people for whom the improved invalidity pension and the mobility allowance are being provided.
I am sure your Lordships will welcome this Bill. It is with confident expectation, if I may say so, of support from all sides of the House that I bring this Bill to your Lordships for consideration and ultimately for your acceptance. I apologise for speaking so long. This is a complex and involved Bill and I do not think that I could have shortened my speech any more than I have done. I beg to move that this Bill be now read a second time.
Moved, That the Bill be now read 2a—(Lord Wells-Pestell.)
5.38 p.m.
Lord ABERDARE: My Lords, I think that we all will be grateful to the noble Lord for having explained this very complicated measure with great clarity and obviously with a great grasp of the very many intricate proposals contained in the Bill. I had the privilege of introducing the 1973 Act in your Lordships' House, and I can only say how sorry I am that after such a comparatively short period it is being replaced by another Bill. I only hope that Lord Wells-Pestell's Bill—if I may so call it for the moment—has a longer life than that Act.
My Lords, the recent Parliamentary history of pensions legislation is really
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deplorable. The National Superannuation Insurance Bill associated with the name of Richard Crossman fell in 1970. Then we introduced our own 1973 Bill, which for the first time contained provisions for earnings-related contributions for a flat rate pension and a reserve scheme, on a funded basis to provide an earnings-related second pension for those who were not in occupational pension schemes. Then, with the election of the Labour Government in 1974, the implementation of part of our Act was dropped and the present Bill has now been brought before your Lordships. The situation was becoming somewhat ridiculous, with one Government reversing the previous one's plans, to the utter confusion of those people who tried their best to provide occupational pension schemes.
One thing that is of paramount importance in the pensions industry is stability over a long period—which is just what we were not providing. It is hopeless if on coming into Office every Government change the rules of the game so that only the pensioners suffer. For that reason we took the view that we should do our utmost to co-operate with the Government on the Bill. We wanted an agreed Bill, provided we were satisfied that it allowed for a viable partnership between State and private pension schemes. That has been the main objective of my colleagues in another place. We now have a Bill which is largely supported by all the Parties.
I believe that I am entitled to take credit for the attitude which we have shown. We should have far preferred to retain our 1973 Act, to build on it and to develop from it. Indeed, we still have some reservations about this legislation. But, given the fact that the new Bill is now before us, we can claim to have co-operated with the Government in what we concede to be a matter of national interest. Naturally, I give credit also to the Government for their willingness to listen to our arguments and to make concessions on some points which we have produced. I hope that this area of co-operation will continue in this House. I assure the noble Lord, Lord Wells-Pestell, that our attitude will be as he requested—as constructive as we can make it.
In our Act we were just as anxious to provide a satisfactory and lasting scheme

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for pensions. But I think we were more influenced by problems of resource allocation and the determination of priorities. There tends to be a different approach between the Labour Party and ourselves on those issues. The Party opposite often take the view that people have a right to certain benefits and that, therefore, we must find the money to finance them. We tend to take the view that we should maximise our financial profitability in order to maximise our social benefits. But, in the end, we can pay out in benefit no more than we earn, and we then have to take priority decisions to make choices between what we can afford.
Of course, pensioners are a most deserving section of the community. No one would wish to deny that, certainly not in your Lordships' House! But there are others—children, the sick, the disabled, the disadvantaged, and with limited resources it is the Government's duty to make choices in allocating their funds to the various needs of their citizens. These considerations led us to lay great stress on the importance of funded occupational schemes and a funded reserve scheme. Under our Act, the second pension was to be provided out of real savings, not out of current contributions. The Government's proposals, for what is called "the additional component ", is on a pay-as-you-go basis. It is not funded, but is paid for out of current contributions and by taxation. Moreover, the Government have assumed expensive liabilities to pensioners in the provisions to revalue pensions in line with inflation. The net effect is a large allocation of public resources to pensioners, and therefore much less room for manoeuvre within the limits of public expenditure for meeting the needs of other groups.
Certainly we welcome the new mobility allowance, but that has not satisfied everybody. I see that the noble Baroness, Lady D'Arcy de Knayth, will be speaking later. I have no doubt she will make some positive comments on the subject. But my noble friend Lord Sandys who is speaking at the end of the debate will deal more thoroughly with the provisions for the disabled. My main point of substance is that the more public expenditure is devoted to meeting the needs of the pensioner, the less is available for other groups in need. The noble Lord, Lord
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Wells-Pestell, referred to some of the huge figures involved in the National Insurance Fund. He told us of the primary contribution of 16½ per cent. and how this would rise over the years as the scheme matured.
Moreover, there is essentially a good deal of uncertainty over calculations of the future finances of the National Insurance Fund. So much depends on the assumptions made by the Government Actuary in arriving at his figures. For example, in the case of this Bill the Government Actuary's assumptions include a rate of unemployment of 2½ per cent.—that is, about 575,000. Certainly we know, unfortunately, that that is an underestimate at present. It is also disclosed that for every 100,000 more unemployed the Fund has to find another £115 million, or it is that much worse off for lack of contributions and for paying out more benefits, while in addition another £60 million has to be found in supplementary benefit for every 100,000 unemployed.
In subsequent estimates in connection with the Social Security Benefits Up-rating Order 1975 more realistic assumptions have been made. An unemployment figure of 850,000 is used. This has resulted in that later estimate of an overall deficit of £368 million in the Fund for 1975–76. I cannot help having some apprehensions, therefore, about the burden which we are placing on the working population of the future, at a time when we have a growing percentage of old people in the population and declining birthrate. But the situation will be much worse if the Bill results in a reluctance by employers to contract out.
We made it a first priority of our 1973 Act to encourage the growth of occupational schemes. The fact that they are fully funded means that they represent real savings and provide funds that are badly needed for investment. Usually, they provide better benefits than a State scheme and are certatinly more flexible in gearing their benefits to the needs of a particular industry or locality. We had high hopes of success. No one did more that the noble Lord, Lord Byers, to promote occupational schemes in industry.
We now face a different situation. Many existing pension schemes are enjoying—if that is the right word—a negative rate of return. The rate of return on their investments is insufficient to meet their

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outgoings. I know we all hope that this is but a temporary situation. However, the whole concept of partnership with the occupational pension industry in this Bill will depend on a rate of return on investments that exceeds the rate of earnings increase over the long term. That means that the Government's whole economic policy is involved.
Much of the Bill's success will depend on the level of contracting out. There still remain areas of concern to those involved with occupational schemes in the pensions industry. I grant that the Government have made some useful concessions, which the noble Lord mentioned, especially in respect of early leavers, those who quit a scheme before reaching pensionable age; whereas the Bill says that rather than the employer preserving the pension and keeping it proof against inflation, he may choose to limit his uprating to 5 per cent. per annum and leave the balance to the State on payment of a premium. The anxieties of the pensions industry surround the amount of that premium.
The noble Lord also told us of the case of a contracted out scheme that can no longer afford to contract out or which is wound up. In such case again a premium is payable to the State in respect of those who are either in receipt of a pension or who have accrued rights towards one. Again it is the amount of that premium that gives rise to anxiety. I am sure it will be well appreciated that it is of the essence of a funded pension scheme that it is able to calculate its risks with some considerable accuracy. An unknown commitment to pay a premium on some future occasion poses an insuperable problem to an actuary who has to work on known or at least assumed figures.
I concede at once that the Government have made a concession in respect of the calculation of any such premium, in that the employer can calculate his revaluation on the basis that earnings have risen by 12 per cent. per annum in the preceding five years, as the noble Lord told us, and that the calculation of the premium will take account of current market yields. But, as I have said already, many pension schemes are in difficulties. The rate of wage increases on which occupational
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pensions are mostly calculated is greater than the return on the pension scheme's investments. In simple terms, they are trading at a loss, and unless inflation is curbed and profitability restored to industry and commerce, the whole structure of occupational pensions will be destroyed. No one takes such a gloomy view, but the Government must act quickly to restrain wage increases, to raise the profitability of industry and to reduce inflation. Employers at present are considering contracting out, and they are faced still with many doubts and difficulties. If the Government genuinely want to make a success of a partnership with the occupational pensions industry, they have to remove these doubts. To do them justice, they have shown the willingness to do so in another place; I hope that we shall see some further steps taken in the course of this Bill through this House.
5.52 p.m.
Lord BYERS: My Lords, I will naturally follow fairly closely the noble Lord, Lord Aberdare, who has just spoken, but first I think it only right at this stage to declare an interest, if only an indirect one. As your Lordships may know, I am chairman of the Company Pensions Information Centre which was set up in 1973 to bring to the notice of employers their statutory obligations under the 1973 Act. I was glad to have the assistance of the noble Lord, Lord Aberdare, when we first went into the campaign. The Centre now provides advice on and stimulates interest in occupational pensions matters, and that is why I say this is an indirect interest. Although the Centre is financed by a number of insurance companies, it is not concerned with promoting any specific scheme or any particular type of scheme. It is concerned to see the maximum number of people enjoy good occupational pensions of any type and from any quarter.
Having said that, I want to say at the outset that, despite the delay which occurred from the scrapping of much of the 1973 Act, I welcome what has been done since then. Particularly I welcome the steadfast adherence of the Secretary of State to the concept that the best form of pensions provision in the future will be through a close partnership between State provision and good occupational schemes. I should also like to pay tribute

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to Mr. Brian O'Malley, the Minister of State, and the staff at the Department of Health and Social Security, for the close and sympathetic consultation in which they have engaged at all stages of this measure. To me, as an old Parliamentarian, it has been a pleasure to see the way this job has been tackled. I also want to pay tribute to all those who have made a sincere effort to raise pensions above Party politics, and particularly the attitude of the official Opposition has been extremely helpful in this matter. All of us recognise, as the noble Lord, Lord Aberdare, said, that the way we politicians were carrying on was intolerable from the point of view of the future pensioner, and many years were wasted as a result of the changes which took place.
If we can carry through this all-Party, all-interest agreement to Royal Assent, it will represent an historic landmark in pensions legislation in this country, and something of which we can all feel proud. As a result of all this consultation, the Bill has been much improved since the White Paper was produced. For those of us who want to see the maximum number of people included in good and viable occupational schemes, the major test at this stage and over the next few months is whether in our judgment the terms for contracting out of the State earnings-related scheme in favour of going into a good occupational scheme are attractive enough to ensure that the vast majority of employers will wish to do so and, probably equally important, that those people whom employers consult on these matters can, with a clear conscience, advise them to do so. This is a matter of judgment; it is not a matter en which the Government, the political Parties or the industry are opposed to one another in principle.
The Government have often stated their desire to see as many people as possible in good occupational schemes in both the public and the private sector, not only because these schemes can provide better and more flexible benefits, but also, as the noble Lord, Lord Aberdare, said, as a matter of public policy to ensure that adequate funds are available for industry and, I would add, that the already heavy burden on the State of the "pay as you go" system is kept at a
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tolerable level. So it is a matter of judgment.
In order to gauge whether the Bill contains the necessary incentives for the employer to contract out, we have to look at a number of factors. The first and possibly the overriding factor is the state of the economy and the rate of inflation at the time when the decision has to be made. I should not like to have to make that decision this week. This is not just a matter of pensions; it affects all major business decisions, of which pensions and the future of pensions is only one. In my view the rate of inflation simply has to be brought down smartly in the next 12 months, and the sooner we start this the better. If employers do not feel confident that this rate of inflation will be brought under control, the natural tendency will be to elect for the "pay as you go" basis and the inflation proofing of the State scheme, but without the flexibility which the occupational scheme can offer.
Secondly, the Government would be wise to see what further steps they can take to cut down the uncertainty which makes employers hesitate to contract out. This means that much will depend on what further assurances the Government can give in this House on what have become known as the open-ended commitments. In the main, these fall into three categories: the liabilities in respect of those who leave service; the liabilities in respect of a scheme which ceases to contract out; and the liabilities of a scheme which is wound up and whose members are brought back into the State scheme.
It is not my intention to rehearse the very technical arguments put forward in the other place and elsewhere on these three matters. On the other hand, I do have the advantage of hearing a wide range of views from many different people, and I am at the moment concerned at the views which I hear have been expressed over the past few weeks, even among those who have good occupational schemes, that contracting out was not an attractive proposition. I am hoping the concessions, the improvements, which the Government have made in the Report stage in another place may alter this to some extent, but at the moment, when they balance these improvements

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against the inflation in the economy, they are not showing any attraction to contracting out, and that worries me.
We have to remember that it is the employers and not the pensions industry who make the final decision as to whether or not to contract out. For those who already have good pensions schemes it is important that the contracting out terms should be attractive if the Government's offer of partnership is to become effective. If those with good pension schemes are deterred from contracting out, then one has to look at the alternatives; and the alternatives are very complex. The occupational scheme is unlikely to be discontinued completely, but it is not easy to modify a scheme to "live on top" of the new earnings-related State scheme, if one decides not to contract out totally. The problem is that under such an earnings-related scheme the benefits depend not just on the earnings together with the number of years the beneficiary has been in the scheme, but also on changes in the national average earnings. That is further complicated, because the band of earnings is itself a moving one.
I am not saying that these complexities rule out having an occupational scheme "living on top" of the earnings-related one. But it is clear that the complexities themselves will discourage many employers from going very far along this road. Therefore, there is every reason for giving them a positive incentive to contract out and do a clean job.
One further consideration is that if the existing occupational scheme is a good one, then "living on top" will almost certainly involve cutting back benefits at some stage. This will not be popular and it will not be easy to demonstrate the fairness of any particular reduction in benefits which may have to be undertaken.
If there is one thing of which my acquaintance with pensions has convinced me, it is the need to keep things as simple as possible so that the schemes can be understood and appreciated by the members and not just by those who are experts on pension matters. Cutting back benefits will not be popular and it will not be easy to demonstrate the equity
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of such an action. Therefore, as to contracting out itself, the terms at the moment are finely balanced. But we have to ask: is it enough for them to be finely balanced? Should there not be a positive incentive given to employers with good schemes to contract out and to make that their final decision?
There is more to contracting out than just having a good scheme. A prudent employer always has to bear in mind that his business can run into trouble and he may not always be able to maintain a scheme of the required standard. If that happens, as the noble Lord, Lord Wells-Pestell, explained, he may have to buy his way back into the State scheme. If that problem arises, it will need some time to resolve because, apart from the technical considerations, provision has rightly been made for comprehensive consultation.
That is absolutely right; but the employer needs adequate notice, therefore, of any worsening in the actuarial basis of the buy-back terms, because he is not going to be able to decide that he will buy back into the State scheme on, say, a Tuesday morning. This will be a long and, rightly, a comprehensive problem. The second fear on the part of the employer arises when people cease to be contracted out for one reason or another, including leaving before retirement age. The Bill provides alternatives, but those alternatives are still, in my view, open-ended and therefore lend themselves to the criticism that they involve uncertainty which can affect an employer's decision.
I spoke earlier of the widespread views I encounter about the anxieties of employers over this Bill. Here I might mention the starting date. I was delighted, if I may say so, at what the noble Lord, Lord Wells-Pestell, said, because this problem of the starting date—1977 or 1978?—has to be seen in perspective. A year ago I was very much in favour of pressing on and getting the earliest possible date. But the problems for funded schemes are more acute than they have ever been. Pension schemes are badly hit by inflation. Scales of pay and, hence, pensions based upon them, are increasing the liabilities of pension funds at a rate which is outstripping the yields which those funds can get on their assets.

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This is worrying many of them and the position is made worse, for instance, by such policies as dividend limitation.
This is something which has to be taken into consideration when dealing with this problem of funding schemes. In other words, there is a negative yield on the funds, as the noble Lord, Lord Aberdare, said. Even the best ones are suffering from this, and it is the biggest stumbling block to an effective partnership between the State and private schemes. It will take some time to reverse this trend, and that points, in my mind, to 1978 rather than 1977. Secondly, I do not think we should press employers to reach a decision on the complex issue of contracting out in too short a time. I am hoping that we shall get an improvement in the economy which will make it easier for them to decide to take the action which I should like to see them take.
Finally, the supply of pensions expertise is very limited in this country. The degree and the extent of interest in pensions by the ultimate consumer—the scheme member is higher than ever before, and this is particularly true of the trade union movement, where they are really taking a great interest in pension schemes. This is something which I very much value. The emphasis placed on consultation before the final decision is reached is very great, and it is right that this should be so. Therefore, we should remember that the question of contracting out involves a decision for every single employer, and I am very doubtful whether negotiation and consultation on a measure of such complexity can be completed on such a wide scale by April 1977. If the price of fuller consultation and more informed decisions is a further period of one year, then I believe we ought to accept it. I hope that in this House we can further improve the Bill by the next stage and that, having done so, we can be confident that we have a structure which will endure for a very long time.
6.7 p.m.
Baroness D'ARCY DE KNAYTH: My Lords, I shall deal with only one clause in this Bill today, although at Committee stage my noble friend Lord Crawshaw and I shall doubtless be pursuing the question of the earnings "stop" for invalidity pensioners. The Minister will remember the emphatic defeat suf-
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fered by the Government during the Committee stage of the Social Security Benefits Bill last March, although the Amendment involved was subsequently removed in another place and nothing appears to have been done since then. I should, however, like to welcome some improvement for the invalidity pensioner with an earnings-related pension and the relaxation of the age criterion for the invalidity allowance, which was mentioned by the noble Lord today.
For the moment I shall deal only with Clause 22, the mobility allowance, already roughly outlined by the noble Lord, Lord Wells-Pestell. I agree whole-heartedly with him that it is a very welcome and forward-looking scheme in that it is available to disabled drivers and passengers alike; so that at last those who are too disabled to drive will receive mobility assistance, and also those receiving the allowance will be free to choose on what form of mobility they spend it.
The allowance seems to me to be less encouraging in some aspects, as the noble Lord, Lord Aberdare, has already hinted. It also has some aspects which need explaining. I have given the noble Lord, Lord Wells-Pestell, prior and detailed notice of my questions and he has already answered a small proportion of them. I very much hope that his answers will be not only enlightening but also reassuring. The questions fall roughly into two groups: first, the allowance itself; and, secondly, the people involved.
First, let us consider the allowance itself. When the proposed allowance was announced in September, 1974, it was, as the noble Lord has already said, to be £4 per week. Since last September, the annual cost of motoring for the disabled driver or passenger has increased by between 30 and 33 per cent., depending on what type of car and adaptations are involved. It can now easily cost between £900 and £1,000 per year for a disabled driver or passenger to run and maintain a car. In view of this large increase in costs, why has the mobility allowance been increased only from £4 to £5? I cannot agree with the noble Lord that it is a substantial improvement. Indeed, I wonder why the sum of £5 was chosen at all. Perhaps the noble Lord can tell me how this figure relates to the

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cost of private motoring—the tax element, the cost of providing an invalid "strike" or car, the cost of a hired car and the cost of transport. I should be very glad if he could tell me how this figure was arrived at.
Next there is the question of whether the mobility allowance will be increased to keep pace with rising costs. In view of the speed with which motoring costs are increasing I find particularly worrying the statement in another place during the Committee stage of this Bill to the effect that the Government are not guaranteeing annual uprating in their proposal. Most social security benefits are subject to annual uprating: why is the mobility allowance not being treated in the same way? I wonder what assurances the Government can give to disabled people concerning any uprating of the mobility allowance. Can the Minister at least assure the disabled that the amount of mobility that they can purchase with the allowance in future years will not be any less than they can buy with £5 a week today?
I was disappointed to hear the Minister say that the allowance will be taxable. I know that the Joint Committee on Mobility for the Disabled, of which I am a member and on which 28 organisations concerned with the disabled are represented, has made strong representations that it shall not be taxable, and I wonder just how many other organisations concerned with the disabled have done so. in the case of the amount being taxable, any recipient of the allowance who pays tax at the standard rate of 35 per cent. will receive only £169 per annum, and it would be even less if it were taxed as unearned income. In some cases it would not even cover the tax element in private motoring, which can easily amount to between £155 and £175 a year. Private motoring is very heavily taxed on the grounds that it is a luxury, but for the disabled passenger and driver it is clearly a necessity and, to put it mildly, it is extremely unsatisfactory if the mobility allowance will not even offset motoring taxes. So rapid has been the rise in motoring costs over the past three years that in order to provide the same help as was provided by the £100-a-year tax free private car allowance when it was introduced in 1972, the after-tax
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annual amount of the mobility allowance would have to be at least £200. I know it has been argued that the mobility allowance should be taxable in order to give the most help to those in greatest need, but disabled people are aware that this is a specious argument because they know that different amounts of tax free social security benefits are paid according to when and how people become disabled. The tax free base of these various benefits bear little relationship to the degree of disability or the financial needs of the disabled. I shall be grateful if the noble Lord will at least tell us whether the allowance will be taxed as unearned income or as earned income.
There is another facet of the allowance that I should like the Minister to expand upon. It has been stated in another place that the allowance will not be means tested and it will be generally disregarded in considering entitlement to other benefits. Will the mobility allowance be treated in exactly the same way as the attendance allowance in this respect? Will it be totally disregarded for the purposes of supplementary benefit and for assessing income for the purposes of family income supplement rent and rate rebates, free school meals, free school milk, et cetera? Furthermore, will the allowance affect, or be affected by, any travel to work assistance that a disabled person may receive from the Department of Employment? I also wonder what the position will be in regard to vehicle excise exemption. As your Lordships probably know, disabled drivers and certain disabled passengers are entitled to claim exemption from this tax under the present vehicle scheme. Will the Government give an assurance that these disabled drivers and passengers and any future such persons will continue to enjoy exemption? I hope the Government can assure disabled people that they have no intention of amending existing legislation covering exemption from VED because if this exemption is withdrawn many disabled drivers and passengers will be considerably worse off.
I should now like to turn from the allowance itself to the people who are to benefit from it. It was stated in another place that "The allowance will be phased in over a three-year period. We intend to work as quickly and as flexibly as possible by bringing small age groups within the

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broad age plans and in the order of 15 to 50, 5 to 14, and finally 51 to pension age; "and again" the process of take-up, which we hope will start in January 1976, should be complete by March 1979." Indeed, the Minister has told us today that this process will start in January 1976; but does this mean that all eligible disabled people within the age group of 15 to 50 will actually start to receive payment of the allowance in January 1976? I wonder whether the noble Lord can give any indication of when the allowance will start for the age groups 5 to 14 and 51 to 60 or 65 respectively? If the phasing is not completed before March 1979 no woman who is now aged 57 and no man now aged 62 will be able to receive the mobility allowance, and until what date will men and women approaching pensionable age be able to claim the invalid tricycle or the private car allowance for the first time?
Can the noble Lord also give us some idea what the small age groups within the broader age bands may be? This leads us to another problem. As your Lordships will know, some people are entitled to a small car instead of the invalid tricycle under the existing vehicle services, and when the mobility allowance becomes payable disabled drivers will be able to choose between the allowance and the invalid tricycle. Does this mean that in future those people who might have become entitled to a small car instead of an invalid tricycle will no longer be able to claim one? Disabled mothers in sole charge of a young child for a substantial part of the day form one of the groups concerned; are they to return to their previous sorry position? The mobility allowance will in no way enable those who cannot already afford a car to buy a car—let us be under no illusion about that.
And what are the prospects for people who reach retirement age? In another place the Minister for the disabled gave an assurance that existing beneficiaries under the present arrangements would be able to obtain their benefit or revert to it provided that they still met the conditions under which it was awarded. People over pensionable age who receive the £100 per annum private car allowance will keep it, despite the fact that the mobility allowance is not payable over
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pensionable age. But what will happen to future recipients of the mobility allowance? When a woman reaches 60 or a man 65 will those still able to drive be able to revert to the invalid tricycle or to the private car allowance, or will they cease to be eligible for any financial assistance towards outdoor mobility at a time of life when it is very important for them to retain their contacts with the community and to play their part in the life of the community? Very few women aged near 60 or men aged only 65 are willing to be confined to their homes or would agree that they have no need for outdoor mobility. I hope the Minister will be able to offer us some reassurance on this point.
An entirely different question is that of the medical criteria, which I feel may present problems. At the beginning of the clause on the mobility allowances it says that to be eligible for the allowance a person must be "suffering from physical disablement such that he is unable to walk or virtually unable to do so." It was stated in another place that" The single criterion reflects the sort of medical criterion now in use for the vehicle service; the essential difference is that we are now replacing a discretionary scheme with a statutory scheme. There will be a statutorily defined base, independent adjudicating authorities, medical boards and medical appeal tribunals, insurance officers, local appeals tribunals and National Insurance Commissioners. There will be formal appeal rights." Can the noble Lord outline exactly what procedure a claimant will have to follow when pursuing a claim for a mobility allowance? Bearing in mind that the criterion of being either unable to walk or virtually unable to do so is more of a mechanical engineering criterion than a medical criterion, will the claimant be able to appeal against an unfavourable decision on his being "unable to walk or virtually unable to do so "?
Also will an unsuccessful claimant be able to attend an appeal in person? Will he be allowed to be legally represented at an appeal? It was further stated in another place that "it has not been possible to retain the additional social criterion of the vehicle scheme regarding the need for transport to get to work or run a home." Does this mean that those now covered by these criteria in

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category 3 and such future people will not be entitled to the mobility allowance, because these are only very slightly less severely disabled people who may very well require mobility help to get to work or to attend a place of education?
Finally, there is one more point which I find disturbing and I hope to be reassured upon it. In subsection (5) at the bottom of page 13 and the top of page 14 in the Bill it reads
" Regulations may prescribe cases in which mobility allowance is not to be payable, or is to he payable at a reduced rate, while the person otherwise entitled has the use"—
now it is part (b) which worries me—
" of any prescribed description of appliance under the enactments relating to the National Health Service."
Such wording would seem to allow the mobility allowance to be withdrawn from, or reduced for, those in possession of an ordinary wheelchair such as I am sitting in now, or calipers, or even crutches, or, to stretch a point, even National Health Service spectacles or dentures. I cannot believe this is the intention, and my Lords, we learn from a statement in another place that "Regulations will be made in due course. We had in mind the occupant-controlled, powered, out-of-door wheelchair." I do not find this statement totally reassuring. Can the noble Lord give us an assurance that the mobility allowance will never be reduced for any appliance or aid which is now issued, or may be issued in the future, which can be used indoors, or for purposes other than mobility. Can the Minister also assure disabled people issued with powered wheelchairs for indoor use that these will not be classified at some future date as being suitable for use outdoors? The Money Resolution will severely limit the extent to which this House can improve the allowance, which makes it more even essential for the noble Lord to explain the details, so that we may know what to do on a future occasion. I think he will agree that it can, and should be, improved in future years. It is a progressive scheme in that for the first time it embraces disabled passengers and offers freedom of choice. Although depressed by the announcement that the allowance will be taxable, I trust that the noble Lord will he able to give
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me some answers that will prove that the scheme will not be retrogressive in other respects.
6.22 p.m.
Baroness SEEAR: My Lords, I wish to intervene briefly in this debate, in which many with a great deal more expert knowledge that I possess are speaking. I apologise for the fact that as soon as I have spoken I shall have to leave the Chamber because, not to put too fine a point on it, I have had two guests waiting in the guest room since six o'clock.
My Lords, unlike some of the previous speakers, I should like to give at least a modified welcome to this Bill, which is a great improvement on previous Bills we have seen in this sphere. There are only a few points I wish to make. I am very glad indeed that it has been possible to effect some sort of marriage, even if it is not perfect, between the occupational pensions scheme and the State pensions scheme.
I want to underline the importance of the points made by the noble Lord, Lord Aberdare, and by my noble friend Lord Byers. They were different but connected points in relation to occupational pensions schemes. Like the noble Lord, Lord Aberdare, I particularly welcome the partnership with the occupational pension scheme because of the clement of funding it introduces into the financing of pensions. I feel we are being extremely trustful and optimistic in assuming that future generations are going to support this level of payment of pensions on an on-going basis out of current earnings. Unless the economy rights itself and stays on a far more sound basis than we have experienced over the last two decades, it will be asking a very great deal of them to expect that the level of pensions that we are forecasting and promising to people retiring over the next two decades is going to be financed by current earnings of a reduced group of earners, because that is what it means.
While one accepts that the intentions of this Bill are entirely honourable, future Parliaments and future generations have it in their power to make alterations to Bills of this kind; so the importance of funding and of real savings behind pensions cannot be overestimated. Of course, with this goes the importance of seeing

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that the funded pensions, the occupational pension schemes, are themselves in a position to honour the promises that are made. This brings us back to the point made so forcefully by the noble Lord, Lord Aberdare, which I should like to reinforce—that it is pie in the sky to think we can guarantee people adequate pensions in the future unless the economic situation is brought under control, and brought under control quickly. The anxiety of those concerned with pension funds and occupational schemes throughout the country at the present moment is great and growing, as was stressed by the my noble friend Lord Byers. Under the present situation, to talk optimistically and in a facile manner about the position of pensions is not looking facts plainly in the face.
There is another element of this new scheme which I welcome very strongly, although with certain not very great reservations. This is the extent to which the new scheme can be claimed to be a fresh deal for pensions for women; the extent to which we are moving away, although not as much or as fast as I should like, from the idea that a woman's pension depends on her marital status, on her husband having contributed, and the woman therefore being able to get a pension. She does not in fact get it under the old scheme; she is allowed it only as the dependant of her husband. The idea that that is on its way out, although not as fast as I should like, is welcome, even though it is dragging its feet a bit.
I also welcome the fact—and this is part of the deal, of course, as these always involve a deal—that married women are going to be given the option to contract out. We are the only country which has had the extraordinary provision that a married woman can take a job, but does not take the obligation of paying into a pension fund. There are two sides to this matter. It is not only that she does not get the rights that flow from being a contributor; she does not play her proper part in contributing to pension funds, and it seems to me right and proper that she should do this.
My Lords, I am delighted that the Government have, although with certain hesitation I observe, made up their mind that women are to be made to contribute and to act exactly as if they were male
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earners, contributing to the pension scheme in the same way as men. I have no doubt that I shall be saying it a good many times over the next few weeks, but for my part when I want no discrimination, I want no privileges either, and the privilege of not contributing is one I should like to be without. Of course, speaking as a single woman, it never has been my privilege not to contribute, so perhaps I am slightly biased in that direction, too. I do not see why a single woman should be forced to contribute while married women are not.
While I accept there has to be a transitional period for women already in employment and who have contracted out in such regrettably large numbers, I should like to know more from the Government as to how long that transitional period will be. In my view it ought to be very short indeed. I very much hope we shall not be left with a situation in which large numbers of women, because they entered employment with the right not to contribute, will continue not contributing for a long period of time. It seems to me that there must be a short period in which they can adjust to the new arrangements, but that in a short period of time—
Lord WELLS-PESTELL: My Lords, the noble Baroness, Lady Seear, said she would not be able to stay, so perhaps I may be allowed to intervene to answer that one particular point now. No decision as yet has been arrived at. I do not think the time is going to be a long one, but it is still under discussion.
Baroness SEEAR: My Lords, I thank the noble Lord very much for that information. It reinforces my determination to stay as long as possible and to make the point as strongly as possible. It seems to me that all that is required is that women should be given due notice that they will be expected to pay at a fixed date, and that that date should not be very far ahead. Surely what we want, and what we are edging towards, is a situation in which every individual, regardless of marital status, carries his or her own contributions and claims to all kinds of benefits—sick benefit, unemployment benefit and pension.
The Government have made what seems to me to be a most welcome addition to pension provision, getting into this

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situation by allowing contributions for the time the woman is at home looking after her children. Because of that, there seems to me to be no reason any longer for having two systems, the system of pension which is by virtue of contribution and the system of pension which is by virtue of being the wife of a man who has contributed. We ought before very long to phase out the dependants allowance to the man, make the corresponding adjustment in contribution to be paid, and build up the right of the woman to benefit, be she married or be she single. I hope that the Government will not listen to the voices that came from the Opposition in another place pointing out that four-fifths of women have shown that they do not want this benefit by choosing not to have it when it was optional. There are all sorts of reasons for that, no doubt; but those arguments, though they may have persuaded the women, are not sound arguments. They having gone so far, I very much hope the Government will go the whole way and draw a line beyond which there will be no right of option, whether or not the women have been employed in the past.
6.32 p.m.
The Countess of LOUDOUN: My Lords, the mobility allowance has been universally welcomed, and I have no wish to criticise it as such, but its rapid passage through the Commons without benefit of a Second Reading debate, combined with the restrictive Money Resolution, precluded debate on a number of important issues. Answers to many important questions, especially the exclusion of the two to four-year-olds, were quite inadequate. No regard whatever has been given to the real situation of young handicapped children. Very young children can have extreme mobility problems. Many are already using wheelchairs or can only be transported in buggies. Consider, for example, the situation of a mother whose spastic child aged three cannot support himself on his legs, attempting to fold a pushchair to get on and off buses or tubes and trying at the same time to manoeuvre shopping bags et cetera. She must leave the child to wobble and fall, totally dependent on help from others. When she has other children the situation is even worse.
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There are also children who, though physically able to walk, present severe managerial problems. Such children have mobility problems inasmuch as their behaviour may affect the whole family and tie them to the house for long periods. To quote an example, mentally handicapped children may be hyper-active, aggressive, violent and given to extremes of anti-social behaviour. It should be recognised that in some cases the pre-school years can impose more of a burden on parents than later years. The problems of mobility do not relate solely to attendance at school, and may even be eased at that stage by provision of school transport. If the age limit was put down to two years, this would also bring it into line with the attendance allowance.
With regard to the restrictions on the allowance to people of pensionable age, mobility problems do not end at 60 or 65. This has been one of the most frequent and fierce criticisms made to the Central Council for the Disabled Working Party which has been touring Britain. Disabled pensioners cannot take advantage of numerous concessions available to others. I believe the cost of concessionary fares is estimated at £35 million. The exclusion from benefit of people of pensionable age is an unwarrantable discrimination against the elderly, many of whom have been drawing low incomes for long periods and have had no means of setting aside resources. Moreover, compared with the non-disabled elderly, the severely disabled elderly have additional expenses or additional needs which reduce their relative living standards.
I understand that the allowance is to be taxable. Why? To me this seems quite unjust. Industrial injury and war disablement pensions are not taxed—so why should the mobility allowance be taxed? I would make a plea to the Government to reconsider this proposal. Lastly, I should be grateful if the Minister would inform me of the present position with regard to the disabled housewife. She seems to have disappeared into a sort of limbo.
6.35 p.m.
Baroness PHILLIPS: My Lords, I will not detain your Lordships for very long

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this evening. I am very sorry that the noble Baroness, Lady Seear, has left, because I am afraid I must disagree with her on one point she made. But I feel sure that any words I say in this Chamber will be conveyed to her. I should first like to compliment the Minister on the way he has explained this very complex Bill. As the noble Lord, Lord Aberdare, said, this is the third time we have gone through this, and each time I study it and each time I am totally unable to understand certain clauses. If I appear to put very simple questions to the Minister, it is because I should like some straightforward answers on the record.
In the first place I was rather enlivened to read some of the clauses because I thought we were getting some special magic. One I noticed said "Special provision for surviving spouses ". I thought perhaps we were going to learn some way in which we could all survive our spouses, but I went on to discover that it was nothing of the kind. I should like to ask the Minister about a point which he did not make very clear. Can the employee collect the contracted-out pension as well as under the State scheme?
When we come to the question of the rights of women, I was interested to hear the noble Baroness, Lady Seear, say that so many women had opted for the lower payment. I think it is only fair to say that of course women did not draw the full benefit, so it was natural that they should opt for the lower payment. I think it is right that in a Bill of this kind we should remove that option, but I am concerned at the rate at which this will be removed; that is, the time factor. We have many married women particularly who work part-time, or for short periods of their working lives outside the home. As I understand it, they are to make a payment of 5½ per cent. They may well be on a low wage, like £20 a week, and paying in 5½ per cent. of that, plus tax, plus National Health. At the end of the seven years there seems to be no guarantee, at least not from the Bill, that when the woman becomes 60 she will be able to draw this pension. I realise when the Act is to take effect, but I should like to know how long one must pay in to draw some of these benefits.
I was interested to hear the Minister describe Clause 6. He described how
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the State pensioner had a basic component which was linked to the contributor's previous earnings. He then went on to explain that there was an additional component, and he made some mention of seven times the figure. But the actual description in the Bill really defeats me. Subsection (2) says:
"The additional component shall be the weekly equivalent of 1¼ per cent. of the amount of the surpluses mentioned in subsection (1)(b) above or, if there are more than 20 such surpluses, of those 20 which are the largest."
I should be interested to hear a really clear, simple definition of that. Undoubtedly, working as I do with women, these are the kind of questions one is asked.
I am extremely sorry to see that yet again, in what is a very imaginative piece of legislation, we are carrying over all the worst inequities of the earnings rule. We are still introducing the earnings rule, and here was an opportunity to level this up. We are still dealing with the question of the younger widow. We still have the woman who comes into the scheme younger and therefore receives less. We still have the earnings stop. We still, so far as I can see in Clause 11, have the strange rule of the one State payment; no matter how much you pay into the scheme, nor how many qualifications you have for drawing out, in the end you will get only one payment. If you receive a widow's pension and make a full payment of stamp, you cannot draw unemployment benefit, although you are no less unemployed because you are a widow and you are no less a widow because you are unemployed. But apparently there is an inviolate rule that the State pays you only once in case you let it go to your head. The way it is enshrined in the Bill is that the widow does not get more than one component.
This is a very imaginative piece of legislation and it is a shame that some of these strange anomalies, which, after all, have only crept in over the years, are still to be carried over. I shall be having another go at this during the Committee stage and supporting my noble friends on the other questions which have been raised, but I feel that the Minister would have been disappointed had I not intervened on these rules. I would congratulate him on the way he has introduced this Bill this evening.
6.41 p.m.
Lord BANKS: My Lords, I begin by declaring an interest. I am a director of the life and pension subsidiary company of a firm of Lloyd's brokers. I should like to thank the noble Lord, Lord Wells-Pestell, for his lucid exposition of the provisions of this Bill, and many of those provisions, as my noble friends have made clear, are welcome to us. One thinks of the mobility allowance, and of the treatment of women in the Bill to which my noble friend Lady Seear referred a few minutes ago. I should like to make one or two criticisms of the fundamental principles on which the Bill is founded, and I hope that the noble Lord, Lord Wells-Pestell, will forgive me for introducing a slightly discordant note so late in the debate. My principle criticism of the Bill is that it is a long-term and over-elaborate method of tackling the main pension problem which we have to face. That problem is simply that the basic pension is inadequate. Some 2 million old age pensioners have recourse to means-tested supplementary benefit, and a very large number more could qualify for this benefit if only they applied.
The Liberal Party has all along argued that the important need is to raise the basic pension to an adequate level, and our interim target to be achieved over a period of years has been 50 per cent. of average national earnings for a married couple and 33 per cent. for a single person. In April this year, the actual figures were 33 per cent. and 21 per cent. respectively. The period of years we had in mind originally in which to effect this increase was seven. But, of course, this increase would cost a great deal of money. So successive Conservative and Labour Governments, rather than face this expense in the immediate future, have evolved elaborate schemes designed to provide adequate pensions in anything from 20 to 40 years time!
The present Government's proposals in this Bill would provide higher earners with more than 50 per cent. of average national earnings for a married couple after 20 years in the scheme, but this is still far short of the two-thirds of the final salary which they might expect to get through a good occupational scheme. Low earners would not reach the 50 per cent. of average national earnings level for a married couple. The Government
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apparently feel that to get the higher earners to pay for lower earners' pensions they must offer the former a small and unappetising carrot. I very much question the need for the carrot. I believe that higher earners would recognise the need to provide an adequate flat level pension for all, paid for on an earnings related basis. The Bill does nothing for existing pensioners and very little for those due to retire in the near future. We shall have the position that among pensioners the oldest are poorest until all those born before 1933 have died.
The second criticism is simply this. To provide these pensions, open to criticism on the grounds I have just set out, the burden is thrown on to future generations, as the noble Lord, Lord Aberdare, explained so graphically earlier on. Future generations are expected to pay for the pensioners of their day more than we are prepared to pay for our pensioners today. Yet surely we must face the cost ourselves as soon as possible. Given an adequate flat rate pension at the level suggested—the level I suggested earlier of 50 per cent. for a married couple and 33 per cent. for the single person—then we have taken the view that there is no need to compel people to save for further pension. Any married man on half average national earnings would retire on full pay. Any married man on average national earnings would retire on half pay. But some arrangement must be made to compensate for the disadvantage suffered by those employed persons who have no occupational scheme available to them to supplement the basic pension, and to ensure that their pension corresponds more closely to their final earnings.
Clearly, at the basic pension levels which I have suggested, we are thinking of the rather better off, because the people at the lower end of the scale, as I have already explained, will get a fairly high percentage of their earnings from the higher basic pension. At the moment, employed persons without an occupational scheme are allowed to set aside up to 15 per cent. of their earnings in a retirement annuity with an insurance company or friendly society, and secure complete tax relief on their contribution. We believe that the first, say, 3 per cent. of this contribution should be matched by a similar contribution to the annuity

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from a central account administered by the Government and financed by a levy on all employers with no adequate occupational scheme. It would be up to the employee not covered by an adequate occupational scheme to decide whether he wished to take advantage of this opportunity. We should be helping those who wished to help themselves. The criteria for an adequate occupational scheme could be the same as in the Bill. The levy would be a compulsory one on all employers with no occupational scheme or with an inadequate occupational scheme.
The combination of the high flat rate benefit and the central account scheme would have many advantages. By progressively increasing the basic pension, it would help those already retired. It would thus make a direct attack on inadequate pensions. The central account arrangement would pose no actuarial problems for the State, for it would not involve a vast State fund as in the case of the Conservative Government's Bill. The dividing line between State pension and occupational schemes would be simple and clear. There would be none of the complexities of the contracting out proposals which are incorporated in this Bill. Everyone would understand very clearly what their basic State pension entitlement was. It is unlikely that many people will understand exactly how their pension entitlement is arrived at under the proposals in the Bill.
The main argument against a high flat rate pension designed to take pensioners off supplementary benefit is that it is politically impossible to raise the pension for all retirement pensioners and to knock the increase off the supplementary benefit. This, it is argued, is to increase the income of the better off pensioners while leaving the poorest with the same income. This is described as a waste of scarce resources. Yet this is precisely what the present Bill is designed to do, but over a longer period of time and for tomorrow's pensioners, not today's. The Government hope that by a sleight of hand, the creation of two components of pension—basic and earnings-related—this fact will not be noticed. Furthermore, under the Government's proposals the oldest pensioners will be the poorest, so far as State pension is concerned, until well into the next century.
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Quite clearly, increases which are given twice yearly to match increases in national average earnings must themselves be matched by increases in the supplementary benefit level. But increases which are given over and above with the object of increasing the percentage of national average earnings which the pension represents need not, in my view, be so matched. They would, in effect, consolidate into the basic pension as of right part of the supplementary benefit pension which the supplementary benefit pensioner has been enjoying, eventually overtaking the supplementary benefit pension entirely.
Another reason for adopting the system I have outlined as opposed to the system in the Bill is that ultimately it is to be hoped that the State pension, together with all other social security benefits, will be provided for by means of a tax credit system. The pensioner's income will then be brought to the required level by means of a combination of credits: basic credit, retirement credit, and housing credit, for example. The total will correspond to the required percentage of average national earnings, and it may well be possible to fix that percentage under the tax credit system even higher than the figure I have put forward as a more immediate target. Furthermore, we could then reach the desirable position where there is a basic and retirement credit for every pensioner, so that a married couple receive the same income as two single people living in the same household. The system of a high flat-rate pension coupled with the central account arrangement would give way more easily to a tax credit system than the scheme outlined in this Bill. The central account system would not be affected and the basic pension could easily be provided through the system of credits.
My Lords, I have thought it right in this Second Reading debate to challenge the basic concept of this Bill and to show how the problem might be tackled in another way. Nevertheless, I accept the view that whatever scheme is adopted now should end the chopping and changing which has taken place in the pensions field for so long. All those connected with pensions are sick and tired of working hard to prepare for particular Government plans, only to find that after much toil and trouble these plans are scrapped.

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In Committee, we shall have to accept the basic principles of the Government scheme which, while open to the criticisms I have already made, are preferable to the Crossman and Joseph plans. Nevertheless, our attitude to the Committee discussions will naturally be coloured by the point of view which I have been elaborating today. I repeat, however, that a period of certainty and stability for pensioners is much to be desired and it is to be hoped that all Parties will co-operate to bring it about.
7.2 p.m.
Lord SANDYS: My Lords, my Party very much associates itself with what the noble Lord, Lord Banks, just said, in that we wholly reject the concept of constant chopping and changing. We also associate ourselves with the Liberal Party on what the noble Lord, Lord Byers, said about a simple system commending itself. Such a system commends itself very strongly to my Party. Perhaps at the outset I should mention some remarks made in December 1973 by the noble Lord, Lord Houghton of Sowerby, who, as a veteran politician of the Labour Party, gave his Party some sound advice when he said:
"I am convinced that it would be a great mistake for a Labour Government, should there be one after the next General Election, to suspend the operation of the new scheme. … The 1973 Act should stand for a while before embarking on the next move forward ".
I was one of those present in the Gallery in another place when the present Secretary of State for Social Services made her debut in that high office in March 1974, and I was dismayed, as were all members of my Party, when she announced to the country that it was the intention of the Government to suspend the provisions of the Social Security Act 1973. It is a matter of record that that was done by means of an Order which it was impossible to debate in either House, and we set that aside because, as my noble friend Lord Aberdare said, we are attempting in the course of the discussions of this Bill to look at it in a consensus manner as far as possible.
I refer first of all to the library of documents we have before us. It would be tedious to enumerate them—I have ten beside me at the moment—and I wish to associate myself strongly with what
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the noble Lord, Lord Byers, said about the debt of gratitude we owe not only to the staff of the Social Security Department but also to the Government Actuary, because there is no question but that among the principal documents before us are the financial provisions relating to this measure. In Better Pensions, which is Cmnd. 5713, the Secretary of State commends the White Paper in the final sentence of her opening address in these words:
"So I invite the fullest public debate and discussion of these proposals, confident that they will provide real security in retirement, widowhood and chronic ill-health".
Much as my Party would like to associate itself with those thoughts I regret that we cannot wholly do so, because, as I shall set before your Lordships, there are many problems which we believe are very pressing indeed. I first draw the attention of the House to the Government Actuary's Report. This Report, which is set before us, follows a rather similar Report, the first one being Cmnd. 5143 which was associated with the Social Security Act 1972, and the present Government Actuary Report is Cmnd. 6083. For 1975–76 the estimated outgoing of the National Insurance Fund is stated on page 10 as £7,198 million. The noble Lord, Lord Wells-Pestell, mentioned the figure of approximately £6,500 million and I have no doubt there are good administrative reasons for his giving that figure. I do not quibble with his statement; nevertheless I draw your Lordships' attention to the fact that in the earlier Actuary's Report, for 1972, Cmnd. 5173, the estimate for the same year, 1975–76, was £3,832 million. The estimate has risen by approximately 100 per cent.
This is a truly staggering sum of money and I associate myself strongly with what the noble Lord, Lord Byers, the noble Lord, Lord Banks, and the noble Baroness, Lady Seear, said in this regard because there are strong reasons why we should look forward and backward. We look forward to future generations of pensioners and, as the noble Baroness said, we are charging them with the task of responsibility for looking after those pensions. My noble friend Lord Aberdare put it very strongly indeed when he said that we as a Party associate ourselves with the concept of funding pensions.

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This is an exceedingly complicated matter and we should set the documents aside for a moment and cast our minds back to a point when the pensions system was set in motion. I look back to 1909 when the total number of old age pensioners was 580,000 and they drew a total sum from the Revenue of £7.1 million. Today, curiously enough, there are in our estimate 7.5 million old age pensioners drawing a total of £4,816 million. This is a matter of great satisfaction to my Party and I feel to all noble Lords; that from the point of view of care for the aged this has been achieved over this long period. Nevertheless, it carries with it an important argument that there is an aging population running at a very high rate. Only about 2 million people were concerned in the bracket in 1909 and today we are considering 7 5 million. A future census will probably reveal a higher growth rate and all the difficulties associated with a small working population and a very large retired population. My noble friend Lord Aberdare has already dwelt upon this fact, but I do not think we can possibly emphasise the point too strongly. This is a promise made to the country on the basis that we hope that future generations will pay these very large sums of money. The undertaking that these pledges will be honoured in the future is something we should quail at before lending our full support to it.
I turn to what my Party associated itself with at the time of the last General Election. Before that Election, it was noted by the last Conservative Government what a very strong contribution was made to disabled and handicapped people. Again, it is a matter of public record that under Sir Keith Joseph the tax free attendance allowance was introduced for the first time and was then extended. As a result, getting on for 200,000 families, which had no let up in the business of looking after severely handicapped members of the family, secured some relief and compensation for their efforts and expense. Next, the long term special invalidity benefit was introduced, giving worth while help on top of ordinary sickness benefit. Thirdly, Government spending over the years 1970 to 1974 gave special emphasis to the needs of handicapped people. In the
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debate this afternoon, the noble Baroness, Lady D'Arcy de Knayth, laid special emphasis on Clause 22, which deals with the mobility allowance. In her remarks she—if I may so describe it—peppered the noble Lord, Lord Wells-Pestell, with questions in this regard. I lost count after about 30 and she raised so many points of great complexity that I feel it would not be productive to add to them, though I had a number of parallel questions myself.
We regard the mobility allowance and the question of mobility as of great importance, but I feel that it would not be appropriate to dwell upon it for any length of time, except to say that there is an clement of choice in the present Bill for those who may wish to retain the, to some extent, despised invalid tricycle and the offer of a mobility allowance and the possibility of finding a suitable four-wheeled car. In another place, we have noted the extent to which Members have mentioned the amount of anxiety communicated to them in letters from those presently using invalid tricycles who feel that they may be deprived of them as a means of mobility. We await with interest the answers to the questions put by the noble Baroness and we look forward to hearing the Government's reply in that regard.
I do not intend to speak at great length this evening. The noble Lord, Lord Wells-Pestell, in his very lucid introductory speech, answered a number of the questions which we had in mind. Nevertheless, I think it only appropriate at this stage to warn the noble Lord that we shall be introducing a number of Amendments at a suitable point in Committee. We look forward to co-operation and to discussions with the noble Lord, should he make available to us the services of some of his very valuable staff to go over the intricate and detailed points referred to both by my noble friend Lord Aberdare and by other noble Lords who have spoken this afternoon. It is in a spirit of consensus that we approach the Bill and I feel sure that the House will be rewarded in that respect.
7.5 p.m.
Lord WELLS-PESTELL: My Lords, I do not really know where to begin. I am conscious of the time, because my noble and learned friend who sits upon

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the Woolsack has two Bills to bring before your Lordships and, if I am to do justice to all the questions put to me, I shall be on my feet for far longer than I was when I introduced the Bill. I shall try to deal with some of the questions, and I should like to say to the noble Baroness, Lady D'Arcy de Knayth, that it is perfectly true that I received a letter from her yesterday asking me nine questions, but each question had, I think, three, four or five other questions incorporated in it. I counted them and they came to 39, so they will always be known, as far as I am concerned, as the Thirty-nine Articles of the noble Baroness. I do not propose to deal with them all this afternoon, and I do not think the House would wish me to do so. However, I will write to the noble Baroness and answer every one of the questions, and I shall put the responsibility on her to let her noble friends know the Government's thinking on these matters. I shall touch on some of them, but what I do not deal with tonight will be answered in writing long before the Committee stage.
Lord ABERDARE: My Lords, if the noble Lord is to write to the noble Baroness, would he be kind enough to send a copy of his letter to us and, no doubt also, to the Liberal Party? These are important and interesting questions and it would be very helpful to know the answers.
Lord WELLS-PESTELL: My Lords, working on the assumption that the noble Baroness does not mind my issuing a copy of my correspondence with her, I shall be delighted to do so. The noble Lord, Lord Aberdare, made one point and though I know that he does not really want me to deal with it, I feel that it is perhaps a point of general interest. He asked whether we had our priorities right or whether we were giving too much to the pensioners. I do not believe that I have misquoted him when I say that. I believe that we must bear in mind that the pensioners' share of total personal consumption is at the present moment something like 12½ per cent. The new scheme will increase the total personal consumption of pensioners over the years, although probably not by a great deal. It may take it up only to about 15 per cent. The working population and
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their families have something like 84 per cent. of the total personal consumption, and I feel that this redistribution in favour of the old is one which we should aim at. I say so, because I feel that there is sometimes a feeling that we are doing too much in one direction. However, I believe that we are doing it in the direction where people are very much in need.
The noble Lord, Lord Byers, raised the question of 1978. I think I would say that we accept that. The noble Lord made out a very strong case—there is no doubt about that—and I believe that we accept his arguments and reasons. If we are minded towards 1977—and we are not unmindful of the difficulties—it is because it would bring the measure forward a year and would enable people to begin to earn the new additional components sooner. It is a finely balanced issue and I would not presume to know the answer.
The noble Lord, Lord Byers, also raised the question of a greater incentive to contract out. This matter is still under discussion between the Government and pension organisations, as the noble Lord knows better than anybody else in your Lordships' House. It is a constructive dialogue, so I am informed, and I believe that we must leave it to run its course.
To come to some of the questions of my noble friend Lady d'Arcy de Knayth, taxation of social security benefits and the exemption of certain benefits from taxation is essentially a budgetary matter. But I can assure my noble friend that this new allowance will, like other taxable national insurance benefits, count as earned income for tax purposes. We must bear in mind that, whatever income we have, if our income generally puts us in the tax bracket we are surely in a slightly better position than people with income who do not come within the taxable situation. It seems reasonable that this should be so. In the type of society in which we are living, and bearing in mind the pressures on that society and on Government to provide, as we provide—let us be frank about it—a fairly vast and comprehensive network of social services, we cannot do it on the basis that all those services are tax-free. If it were done on that basis it would mean that many people who could afford to pay tax would escape paying.

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I was quite disappointed—almost appalled—when the noble Baroness said that she would introduce an Amendment to the earnings limit. She is not doing her cause any good by such action. I do not say this in any sense of criticism nor do I say that she ought not to do it. She must do what she thinks is right. But I failed to convince your Lordships on two occasions that people who are in receipt of an invalidity allowance, or a pension—call it whatever you like—get it because they have been certified by a doctor as being incapable of work. How, therefore, can you have a wage stop? Immediately such people go to work, they are, in effect, saying that they are not incapable of work and therefore they ought not to have the allowance. I appreciate that a great deal of emotion is discharged in this House when such matters are discussed. Noble Lords allow their hearts to run away with their heads, and I can understand that. But we must bear in mind the nature of this payment. It is an invalidity pension, granted on medical evidence that a person is incapable of work. Directly you say that there should be a wage stop, you are saying that those people are capable of work. I advise the noble Baroness to think about this point, because I do not think that what she proposes would be helpful in the long run. One of these days someone will have to look at this situation and consider whether if people who are receiving this pension are in fact working it can be held that they are incapable of work.
The noble Baroness also raised the quesion of the vehicle excise licence exemption. I understand that recipients of mobility allowances will not be eligible for vehicle excise duty exemption. In many respects this would be an unfair discrimination in favour of motorists as distinct from other people who are receiving the mobility allowance for other purposes. The noble Baroness also asked whether the allowance is to be disregarded for other benefits. The allowance will be disregarded generally for supplementary benefit purposes, and also for such benefits as family income supplement, rent and rate rebates, and free school meals and milk. It will not affect, or be affected by, the assistance with travel-to-work schemes operated by the Department of Employment. The noble
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Baroness also asked why there should not be annual uprating. The allowance is not a maintenance benefit and automatic annual review is not felt to be appropriate. Nevertheless, from time to time we shall look at the mobility allowance amount in the light of costs generally. I must make it clear, however, that it is not a maintenance benefit; it is entirely different from that. But clearly whatever allowances any Government give, they must be looked at from time to time.
The noble Baroness also raised the question of the increase of the allowance to £5 per week in view of increases in motoring costs. The figure of £4 per week announced in September last year was at the 1975–76 rate. An analogy with the increased cost is not very realistic. There is moreover no specific relationship between the allowance and the cost of private motoring, car hire or public transport. As the noble Baroness knows, this is a mobility allowance which people can obtain for a variety of reasons. I do not want to go over the ground in detail, but, for instance, it relates to those who cannot drive because they do not have a car but who know someone who will drive them around. The allowance is paid to enable such people to get to various places. It is not an allowance intended for acquiring a car, but if people have a car the allowance can help them with the running expenses. It is a new allowance, as the noble Baroness knows. Whatever criticisms noble Lords may have, the fact remains that it is a new benefit which we have introduced, and I hoped that there would be more appreciation of it and rather less criticism.
I was also asked by the noble Baroness what will be the procedure for obtaining a mobility allowance; will there be an appeal; and can the claimant appear in person or be represented? The procedure will involve completion of a claim, then a medical examination and a decision by an insurance officer. There will be provision for appeal to the Medical Appeal Tribunal against a rejection and the claimant will be able to appear in person and can be legally represented. The noble Baroness further asked whether all those in the age group 15 to 50 will receive payment on 1st January, and what will be the position regarding the smaller groups. The first group, within the age

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15 to 50, will be paid from 1st January 1976. Thereafter the speed with which age groups can be phased in will depend on the numbers eligible. Children aged 5 to 14 and adults aged 51 to 60 should be phased in by the second and third years, but greater speed may be possible, depending on the size of the problem. But I simply do not know at this stage. I was also asked what happens when a woman reaches the age of 60 or a man reaches 65. The beneficiaries who have reserved rights by being existing holders of three-wheelers or private car allowance will be able to revert; otherwise the allowance or the issue of the three-wheelers will cease.
The noble Countess, Lady Loudoun, raised a number of points, some of which I believe I have dealt with in answering the noble Baroness. The noble Countess asked what has happened to benefit for disabled housewives. The main non-contributory invalidity pension will start in November this year, as the noble Countess knows. The timetable for bringing housewives into the scheme is still uncertain. It is no good my pretending that it is to be implemented immediately. I accept the need to make this further advance as soon as possible, but I emphasise the importance of not trying to do everything at once, which could mean our getting into difficulties and probably not achieving as much as we should wish.
The noble Countess also asked why the allowance should be restricted to people under pension age. Most of us would be quite frank in this respect and admit that we regret the need to impose limitations; but having regard to our present financial difficulties we have been compelled to draw a line somewhere and we have felt bound to concentrate the available resources in helping the younger disabled. It is as simple as that. Why not include children from two to four years of age?—was another question put to me by the noble Countess. The short answer is that problems of mobility are somewhat less acute with younger children, and, rightly or wrongly, we felt that we ought to start with children of school age. My noble friend Lady Phillips talked about the make-up of the pension. This is a complicated matter. I found myself reading and re-reading it and then taking advice on it. The additional component
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is 1½ per cent. of the earnings above £11·60, the level of the basic component, over the 1¼ per cent. representing eightieths drawn over the contributor's best 20 years. The seven times referred to in the earnings is the ceiling which I said was just over £80 a week, for which no extra contributions are levied and no extra pension is earned. You get your basic component, and then take the best 20 years for which a person, either man or woman, will get twenty times 1¼ per cent.—making 25 per cent. which is one quarter of the average earnings of the best 20 years.
Baroness PHILLIPS: My Lords, may I say that the Minister makes it much clearer than the Bill; the Bill left out the word "years".
Lord WELLS-PESTELL: My Lords, only because the Minister himself did not understand it and had to read and re-read it and take advice. My noble friend raised the question: Can a woman rely on getting a return for her contributions? Any additional component which she has earned will be payable, whether her basic pension is based on her husband's or her own contributions. As a widow, she will get the additional components which both she and her husband have earned, subject to her getting no more than a single person who had contributed at the £80 a week level which is the maximum of the scheme; in other words, she can have only one basic component. She cannot have the two, but she will get both her own and her late husband's additional components.
The noble Baroness also asked me whether an earner can benefit from the State scheme and also a contracted-out scheme. A contracted-out earner will receive a basic level pension; that is the basic component from the State and a guaranteed minimum pension the equivalent of the State's scheme additional component from the contracted-out scheme, except that the basic component will be the State one. What they will get from the contracted out one will be the occupational pension scheme. I am trusting entirely to memory and perhaps I ought not to bring this in, but it may well be that the contracted-out scheme will be working on the basis of sixtieths rather than eightieths, though it amounts to much the same thing.

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I really do not know what to say to the noble Lord, Lord Banks—he rather shook me. I thought at one time that he was damning the thing with faint praise, but on reflection I do not think that is so. I think we have a scheme which, like every other scheme, is not foolproof and not holeproof. We have to make the best of it. One of the rewarding things about it is that at least we are having a meaningful (I do not like that word, though it was the first that came to my mind) discussion with experts in the pension field from whom we have derived a good deal of information and expertise. Therefore the two together will be of considerable benefit. If it has merit at all, it is that there is this partnership to which we attach a great deal of importance—the partnership of a State scheme with the contracted-out scheme which so many firms have had in operation for many years and which, in spite of inflation and the problems we face today, they want to continue. In the circumstances this is probably ideal. To be honest with the noble Lord, I want to read what he has said, because in many ways he explored a new philosophy. Perhaps that is putting it a little too high, but I should like to read what he has said and consider whether there is anything which, even at this late hour, we can take out of it.
I am grateful to the noble Lord, Lord Sandys, for his contribution. We on this side of the House realise that there will always be an element of difference between us. Our basic philosophies are rather different, but as a House I think we tend to come together on matters of this kind. The noble Lord referred to 1909. I have just finished reading my third biography of Lloyd George. I think I have said before, and there is no reason why I should not say again, that we owe a great deal to the Liberal Party in this country. We on this side of the House like to think that the mantle of the Liberal Party has fallen on us, but I am sure noble Lords will not agree. Successive Governments have realised that a great deal has to be done for the community as a whole. Our emphasis from time to time has been slightly different, but in the long run we have gone along much the same road, sometimes perhaps a little faster than others. I am grateful to noble Lords for staying and for their contributions. I
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hope that the Committee stage and the Report stage will be as amiable as Second Reading.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

LOCAL LAND CHARGES BILL [H.L.]
7.28 p.m.
The LORD CHANCELLOR: My Lords, this is a technical Bill designed to improve one part of our conveyancing machinery, itself a technical field. I apologise to noble Lords for inflicting such a monstrous technicality on the House at this hour. The Bill implements the recommendations of the Law Commission's Report on Local Land Charges (Law Corn. No. 62) and reproduces, with minor changes, the draft Bill annexed to that Report. The Report gives a clear account of the history and nature of local land charges and the need for reform and the Bill annexed to it is accompanied by detailed explanations.
The law relating to local land charges has become complicated, but their fundamental nature is simple. In the later years of the last century, local authorities started obtaining statutory powers which were liable to lead to the imposition of encumbrances on land in private ownership. The Public Health Act 1875, for instance, authorised local authorities to take what was apparently at the time the unpopular step of requiring undrained houses to be properly drained, and in default of compliance by the owners of the houses, they were further authorised to carry out the work themselves. In that event the authority's expenses were recoverable from the owners and until recovery they constituted a charge on the premises in respect of which they were incurred.
The prototype of a local land charge is a statutory financial charge on land, enforceable by a local authority against successive owners and registrable in a register kept by a local authority officer and open to public inspection. Registration of a charge constitutes notice of it; and in broad terms a purchaser of land takes the land burdened with any charge which is registered and free of any charge which is not.
There is a resemblance between this kind of charge and the ordinary private

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land charge, such as a restrictive covenant or contracts and options for the purchase of land. Indeed the Land Charges Act 1925 dealt with both types of charge. Nevertheless, even in 1925 there were considerable differences, for example: local land charges could only be imposed by local authorities, land charges by anyone; local land charges were registrable locally, land charges by the Land Registry; local land charges were registrable against land, land charges (in so far as they affected unregistered land) against names.
Since 1925 further differences have arisen, notably in the use of the local registers for purposes beyond their original scope. Many statutory burdens on land—not merely financial ones—imposed by local or central authorities have been made registrable in the local registers. Many of these matters are not true local land charges at all, for they bind the purchaser whether or not they are registered.
There have also been changes in the law relating to ordinary land charges, which was consolidated by the Land Charges Act 1972. That Act consigned to a Schedule the remnant of the Land Charges Act 1925, which now relates solely to local land charges. Thus land charges and local land charges were always different creatures and have grown further apart over the years. While much has been done to remedy defects in the land charges system, local land charges have always been treated as an undeserving relation. Although they received the attention of the Stainton Committee, it is a sad thought that the Report of that Committee was published as far back as 1952—so that it has indeed been pigeon-holed for a very long time.
I turn now to the main features of the Bill. First, Clauses 1 and 2 redefine the classes of things which are to be local land charges. The clauses make many technical improvements designed to resolve doubts and to simplify the drafting of future legislation. I particularly draw attention to Clause 2(e), which puts it beyond doubt that planning conditions—matters which are already recorded in the planning registers—are not local land charges. Clause 3 imposes upon local authorities the responsibility for registra-
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tion and in so doing relieves the officers of local authorities from their present personal responsibility for this important statutory function. Clause 3(3) enables the index to the register to be kept by means of a device, such as a computer. I hope that this will be helpful to local authorities; but I must make it clear that the Bill does not provide for computerising the registers themselves.
Clause 10 entitles a purchaser to compensation if he suffers loss through a failure to register a charge or a failure to disclose a registered charge in response to a request for an official search. This clause makes a radical innovation. I have already explained that where a true local land charge is unregistered the purchaser takes the property free of it, but that other registrable matters bind the purchaser whether they are registered or not. In these latter cases a purchaser affected by a charge of which he knew nothing before the purchase may find it difficult or impossible to obtain redress. The arguments against the existing law are detailed in paragraphs 46 to 51 of the Report.
My Lords, failures of registration or disclosure are comparatively rare, and the potential liability for compensation by Clause 10 is likely to make them even rarer. The clause, however, radically improves the law by creating a fair balance between public and private interests and by replacing a chaotic jumble by cohesion and uniformity.
The remaining provisions of the Bill either re-enact the existing law or are concerned with minor points. I only want to mention one final matter. The Report refers to "supplementary inquiries ". These inquiries are extra-statutory and are settled by agreement between the Law Society and the local authority associations. The Bill does not deal with them and I am satisfied that it should not do so. I commend the Bill to the House as a most useful contribution to the continuing reform of our law. I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read 2a.—(The Lord Chancellor.)
Lord SANDYS: My Lords, on behalf of my noble and learned friend Lord Hailsham of Saint Marylebone, I have been asked to apologise to the House for

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the fact that owing to a totally unforeseen circumstance he has been prevented from taking part in this debate. My noble and learned friend wishes to associate himself with the Government's intentions in respect of this technical measure referred to by the noble and learned Lord who sits on the Woolsack. He will no doubt wish to take part in later discussions on the Bill, but nevertheless wishes to convey to your Lordships his broad approval of the measure.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

INHERITANCE (PROVISION FOR FAMILY AND DEPENDANTS) BILL [H.L.]
7.35 p.m.
The LORD CHANCELLOR: My Lords, I have it in command from Her Majesty the Queen and the Prince of Wales that they, having been informed of the purport of the Inheritance (Provision for Family and Dependants) Bill, have consented to place their prerogative and interests, so far as they are concerned on behalf of the Crown, the Duchy of Lancaster and the Duchy of Cornwall, at the disposal of Parliament for the purpose of the Bill. I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read 3a.—(The Lord Chancellor.)
On Question, Bill read 3a.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 1:
After Clause 23 insert the following new clause:
Effect of this Act on s. 46(1) (vi) of Administration of Estates Act 1925
(" Section 46(1) (vi) of the Administration of Estates Act 1925, in so far as it provides for the devolution of property on the Crown, the Duchy of Lancaster or the Duke of Cornwall as bona vacantia, shall have effect subject to the provisions of this Act.")
The noble and learned Lord said: This Amendment has as its purpose to make clear beyond doubt that the courts' discretionary powers to award maintenance out of the estate of a deceased person shall apply where the deceased dies intestate, leaving no spouse or next of
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kin, so that the property passes to the Crown, the Duchy of Lancaster or the Duke of Cornwall as bona vacantia. In the absence of this provision the position would be doubtful since the Bill is not expressed to bind the Crown, and it could be argued that it would not affect an estate which has devolved upon the Crown or the Duchy Estates. Third Reading of the Bill was deferred on 15th May so that this question could be looked into and any necessary consents could be obtained.
Section 46(1)(vi) of the Administration of Estates Act 1925 provides that where a person dies intestate leaving no spouse or relative who takes an absolute interest under the previous provisions of the section, the estate belongs to the Crown, the Duchy of Lancaster or the Duke of Cornwall as bona vacantia; and the subsection goes on to say that the Crown, or the Duchy or the Duke
" may provide in accordance with the existing practice for dependants, whether kindred or not, of tile intestate and other persons for whom the intestate might reasonably have been expected to make provision."
In practice generous provision is made under Section 46(1)(vi) for any dependant or any person who can be retarded as having a moral claim on an estate which passes to the Crown or one of the Duchies as bona vacantia. Occasion may never arise for the exercise of the courts' power to award maintenance out of the estate in such a case. Nevertheless the purpose of the Bill is to provide a unified code applicable in all cases, whether the deceased died testate or intestate. In the interests of clarity and uniformity, it is advisable to make it clear that the courts' powers are available, if required, in all cases of intestacy, regardless of the ultimate destination of the property under Section 46 of the 1925 Act.
This Amendment accordingly provides that the devolution of property of the Crown, the Duchy of Lancaster or the Duke of Cornwall under Section 46(1)(vi) of the 1925 Act shall take effect, subject to the provisions of the Bill. This will mean that although the ultimate destination of the estate will continue to be governed by Section 46(1)(vi), it will be open to any of the persons mentioned in Clause 1 of the Bill to apply for maintenance out of the estate. In practice,

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however, since the subsection applies only where there is no surviving spouse or next of kin, it would only be a former divorced spouse, a child of the family who was not related to the deceased or a person unrelated to the deceased who was being maintained by him at the time of his death who would have occasion to take advantage of this provision.
This Amendment is put forward with the consent of the Queen and of the Prince of Wales. Before the Motion for the Third Reading is put it is right that the House should be informed that Her Majesty had agreed to place her interests in right of the Crown and of the Duchy at the disposal of Parliament and for the purposes of the Bill as amended in this way, and the Prince of Wales has in turn signified his agreement so far as his interests as Duke of Cornwall are affected. My Lords, I beg to move.
Lord SANDYS: My Lords, the House will indeed be grateful to the noble and learned Lord the Lord Chancellor for explaining in great and meticulous detail the provisions of this Amendment, despite there being a thinly represented House on this occasion. We are most grateful.
Clause 25 [Repeals and transitional provisions.]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 2:
Page 23, line 26, at beginning insert—
"( ) Section 36 of the Matrimonial Causes Act 1973 (which provides for the alteration of maintenance agreements by the High Court or a county court after the death of one of the parties) shall have effect subject to the following amendments (being amendments consequential on this Act), that is to say—

(a) in subsection (3) for the words "section 7 of the Family Provision Act 1966" there shall be substituted the words "section 22 of the Inheritance (Provision for Family and Dependants) Act 1975", for the words from "the Inheritance (Family Provision) Act" to "net estate" there shall be substituted the words "that Act if the value of the property mentioned in that section" and for the words" section 26 of the Matrimonial Causes Act 1965 (application for maintenance out of deceased's estate by former spouse)" there shall be substituted the words "section 2 of that Act";

(b) in subsection (7) for the words from "section 7" to "subsection (5)" there shall be substituted the words "section 22 of the
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Inheritance (Provision for Family and Dependants) Act 1975 (which enables rules of court to provide for the transfer from a county court to the High Court or from the High Court to a county court of proceedings for an order under section 2 of that Act) and paragraphs (a) and (b) of subsection (4)" and for the words "any such proceedings as are referred to in subsection (1) of that section" there shall be substituted the words " proceedings for an order under section 2 of that Act"."

The noble and learned Lord said: My Lords, Amendment No. 2 is an Amendment which adapts certain provisions in Section 36 of the Matrimonial Causes Act 1973 to take account of the repeal of Section 7 of the Family Provisions Act 1966 by the Schedule to this Bill. Section 36 of the 1973 Act gives the courts power to vary a maintenance agreement after the death of one party and it provides for this jurisdiction to be exercised by the county court where the value of the deceased person's estate is such that a county court would have jurisdiction to hear an application for family provision by virtue of Section 7 of the Family Provisions Act 1966.
After the enactment of this Bill the county court's jurisdiction in family provision matters will be governed by Clause 22 of this Bill and not by Section 7 of the Family Provisions Act 1966, which will be repealed. This Amendment accordingly substitutes references to Clause 22 of this Bill for the existing references to Section 7 of the 1966 Act.
I am happy to say that so far as these Amendments are concerned the noble and learned Lord, Lord Hailsham of Saint Marylebone, intimated to me that he agreed with them. I was comforted by the fact that the noble and learned Lord, Lord Simon of Glaisdale, also agreed; so there is formidable support. My Lords, I beg to move.
Lord SANDYS: My Lords, once again on behalf of my noble and learned friend Lord Hailsham of Saint Marylebone, I should like to confirm what the noble and learned Lord on the Woolsack has said; namely, that my noble and learned friend wishes to associate himself with the Amendments referred to.
On Question, Bill passed, and sent to the Commons.

LONDON TRANSPORT BILL
Examiners' Certificate that no further Standing Order is applicable: Ordered, to lie on the Table.
GREATER LONDON COUNCIL (GENERAL POWERS) BILL
Brought from the Commons; read 1a, and referred to the Examiners.
JAMES HUGH MAXWELL (NATURALISATION) BILL [H.L.]
Returned from the Commons agreed to.
LOTTERIES BILL
Reported from the Public Bill Committee with Amendments; Bill to be printed as amended: the Report to be received.
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