Sitting of 27 July 1976

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
  SUFFOLK COASTAL DISTRICT COUNCIL BILL
  Lords Amendments agreed to.
  YORKSHIRE WATER AUTHORITY (RIVER DERWENT) BILL [Lords]
  Read the Third time and passed, with amendments.
  LONDON TRANSPORT BILL
  Read the Third time and passed.
  TYNE AND WEAR BILL [Lords]
  Read a Second time and committed.

  METHODIST CHURCH BILL [Lords] (by Order)
  Order for consideration, as amended, read.
  Bill to be considered upon Thursday.

  EXPERIMENTS ON LIVING ANIMALS
  Address for Return,
  of Experiments performed in Great Britain under the Act 39 and 40 Vict. c. 77, during 1975.—[Dr. Summerskill.]

ORAL ANSWERS TO QUESTIONS
  SOCIAL SERVICES

    Preventive Medicine and Health Education
    Mr. Nelsonasked the Secretary of State for Social Services if he will undertake a programme of preventive medicine and health education.
    Mr. Wakehamasked the Secretary of State for Social Services what plans he has to follow up the statements in the document "Prevention and Health: Everybody's Business".
    The Minister of State, Department of Mealth and Social Security (Dr. David Owen): The recent consultative document "Prevention and Health: Everybody's Business" aims to stimulate interest in prevention amongst the general public and in the health service. A series of specific papers will be published over the next few months on fluoridation, occupational health, and services related to pregnancy and childbirth. This programme is being, and will be, further supported by decisions to divert resources, both financial and personnel, towards preventive health.
    Mr. Nelson: Is the Minister aware that one out of every three children in the country is not receiving a polio vaccination? Does he recognise that poliomyelitis in other countries could be easily imported into this country? What action does he intend to take to bring to the attention of parents the need for a high level of polio vaccination for children?
    Dr. Owen: There has recently been an increase in polio vaccination, and to some extent, that reflects what the hon. Gentleman said about the fairly low uptake in the past. That has concerned me, not just for polio, but other vaccination programmes. Sometimes I wish that the general publicity about vaccination would concentrate more on the benefits than on some of the admitted disadvantages of vaccination, because the advantages of vaccination, when properly organised, far outweigh the disadvantages.
    Mrs. Renée Short: Is my right hon. Friend aware that the need to reach the

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    groups of the population that do not normally come into contact with health education would be helped if the Health Education Council had a larger budget than the rather measly £1½ million that it now gets?
    Dr. Owen: That is something that we can examine. I am not certain that the way to improve the situation is to increase central resources, but I agree that there is a strong case for spending more. What is needed is more action in the localities, and there the community health councils have a great rôle to play.
    Mr. Wakeham: Has the Minister had any discussions about health education with the Secretary of State for Employment?
    Dr. Owen: We are in fairly constant touch, particularly over the Health and Safety at Work etc. Act, for which the Secretary of State for Employment has a major responsibility and in which my Department has an interest. I have not discussed the matter with the Secretary of State in any detail, but there is regular contact between officials in the Departments.
    Mrs. Chalker: What action is being taken to reduce the risk of people having heart attacks, to save the 3,500 beds daily which are occupied by the victims of heart attacks?
    Dr. Owen: It is not always for a Minister to take action on such matters. We have to try to get home to people that they have a considerable amount of responsibility themselves. As the booklet "Prevention and Health: Everybody's Business" says, we have become too used to thinking that this is a problem to be solved by Ministers, doctors or pills.

    Mobility Allowance
    Mr. Hicksasked the Secretary of State for Social Services if lie will make a statement on the take-up of mobility allowance.
    The Under-Secretary of State for Health and Social Security (Mr. Alfred Morris): I am glad to be able to say that take-up has recently come well up to our expectations. By 16th July, over 34,000 claims had been received from disabled people in the eligible age range of 15 to 50. So far, awards have been made in over
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    22,000 cases. Some 5,000 have been disallowed. As my answer to my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley) on 23rd July made clear, disabled children aged 11 to 14 will become eligible to claim the mobility allowance from 25th August for payment from 24th November.
    Mr. Hicks: I thank the Minister for that information. Is he aware that one of the obstacles that should be considered in regard to mobility allowance is the inability of the individual to meet the initial purchase price of the four-wheeled motor car? Will he investigate the possibility of allowing a person to commute his or her mobility allowance to assist with the initial financial outlay?
    Mr. Morris: I must emphasise that the mobility allowance has been highly popular with disabled people. The vast majority of them have chosen the mobility allowance in preference to the vehicle. I am very much aware of the importance of commutation, which is why I have been working with the Central Council for the Disabled with a view to seeing whether we can arrive at a scheme that will enable disabled people to commute the allowance so as to be able to purchase the car of their choice.
    Mr. McCartney: Will my hon. Friend try to educate the mass media to understand that the vast majority of disabled people are not disabled drivers, and that a vehicle is of no use to them at all? Is he aware that cash rather than a car is widely accepted as the best policy?
    Mr. Morris: I am grateful to my hon. Friend for raising a most important point. It was put to me strongly by the Chairman of the Joint Committee on Mobility for the Disabled, representing 26 national organisations, that it was the most cruel anomaly to exclude from mobility allowance people who are too severely disabled to drive. I am glad that we are now able to give help equally to disabled drivers and those who are too disabled to drive.
    Mr. Stephen Ross: Will he take the opportunity to qualify what was said in the announcement made on Friday by the Secretary of State for Social Services? What is the position about disabled people who have been promised three-wheeler trikes and who are now awaiting

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    delivery? Will those deliveries be honoured?
    Mr. Morris: Yes, Sir.
    Mr. Ashley: Is my hon. Friend aware that the extension of the mobility allowance to younger children will be warmly welcomed, and that he and his colleagues deserve to be congratulated on that achievement? Nevertheless, will not the phasing out of the three-wheeler create severe hardships to some categories of people, notably those who depend on three-wheelers to go to work? Will he discuss with his right hon. Friend the Secretary of State for Employment the possibility of providing some realistic assistance to enable those people to get to work?
    Mr. Morris: That, again, is a most important matter. A case was reported in the Daily Telegraph yesterday, although that newspaper made no reference whatever to the fares-to-work scheme of the Employment Services Agency. I am glad to say that, quite apart from the mobility allowance, registered disabled people who have to incur substantial expense, which they cannot otherwise afford in order to get to work, may be eligible for financial help from the Employment Services Agency and will be able to apply for such assistance if they cease to have use of an invalid tricycle. I cannot forecast the outcome of any particular case, because grants are based on consideration of individual circumstances.

    Earnings Rule
    Mr. Skeetasked the Secretary of State for Social Services if he intends to phase out the earnings rule.
    The Minister of State, Department of Health and Social Security (Mr. Stanley Orme): We have no plans to do this at the present time, because of the prohibitive cost.
    Mr. Skeet: Does the Minister appreciate that the £50 sum is enshrined in the Social Security Act 1975, and does he agree that it should be extended to £65 per week, which is the average wage earned in manufacturing industry? Surely the Government must respect this situation. It is far better for retirement pensioners to be independent. Will he
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    say how many people are likely to be involved following the abolition of the earnings rule?
    Mr. Orme: The Government are to amend the Act in the next Session to restrict the figure to £35, with appropriate cost-of-living adjustments. Most people who now benefit from the earnings rule will not suffer because of the £35 limit. If the rule were abolished altogether, about 110,000 people would be involved.
    Mr. Hooley: Does the Minister agree that it is grossly unfair that earnings-related supplement to unemployment pay should be subject to the earnings rule, since this can only discriminate against the lowest paid?
    Mr. Orme: I am examining that matter.

    Thalidomide
    Mr. Bidwellasked the Secretary of State for Social Services in view of renewed public interest in documents recently published for the first time, if he will order a public inquiry into the case of the drug thalidomide affecting the birth of deformed children.
    Mr. Ashleyasked the Secretary of State for Social Services if he will now hold a public inquiry into the thalidomide tragedy.
    The Secretary of State for Social Services (Mr. David Ennals): Following the thalidomide tragedy the Committee on Safety of Drugs was appointed in 1963 and a review of medicines legislation was completed. The review led to the Medicines Act 1968, which provided powers for new and comprehensive controls for the safety, quality and efficacy of medicinal products for human and veterinary use. It is unlikely that an inquiry into the thalidomide case would be helpful in identifying further safety measures.
    Mr. Bidwell: Does the Secretary of State agree that an inquiry should take place at this time into the manufacturing and marketing methods pursued by the Distillers Company, in view of the legal restraints imposed on those making claims on behalf of children and also on the Press, particularly bearing in mind the attitude and ministerial responsibility—or irresponsibility—at the time of the tragedy? Does he not agree that this matter should be investigated?
    Mr. Ennals: I do not think that would serve any useful purpose. The facts are well known and have now been published. I do not believe that an inquiry would lead to any new or helpful facts. It would be disturbing for many of those involved.
    Mr. Ashley: Is my right hon. Friend aware that I believe that he is wrong in assuming that a public inquiry would not help to uncover further safety measures, because a good deal of information about the thalidomide tragedy has not yet been disclosed? It is possible—I would say probable—that some other firms are doing exactly the same things now as the Distillers Company was doing then. Therefore, does he agree that a public inquiry, with full public disclosure, is the only way of avoiding this situation? Does he further agree that the cases of the "Y" list children not yet decided would be helped by a public inquiry? Will he reconsider his decision?
    Mr. Ennals: An inquiry into the thalidomide case would not necessarily reveal any facts in relation to other firms. Under the present system, extensive tests and trials are undertaken before a product licence for a new drug is granted. Results of such tests and trials cannot provide a complete assurance against the possibility that a product when brought into widespread use will have an adverse effect on some patients. There is no doubt that the situation has greatly improved since the events of 10 years ago. As for the children, it is a matter between the children, their legal advisers, the Distillers Company and the courts. My information is that so far no claim has been turned down and that 12 of the original children, who numbered 97, have now had their claims accepted. So far as I am aware, the others have not had their claims rejected. It is hoped that their cases will be speedily settled.
    Mr. Patrick Jenkin: I have had my differences with the right hon. Member for Down, South (Mr. Powell), but will the Secretary of State take this opportunity to deny the suggestions made in The Sunday Times that the right hon. Gentleman bore some share of the blame for this tragedy?
    Mr. Ennals: I am delighted to hear that the differences between the two right
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    hon. Gentlemen have now been resolved—
    Mr. Powell: Haud tali auxilio nec defensoribus istis.
    Mr. Ennals: —however, I do not think that it is for me to stand in some judicial capacity and say that no responsibility falls on the right hon. Gentleman. It is not for me to reach a conclusion one way or the other, and I do not think the right hon. Member for Down, South (Mr. Powell) would want to do so.
    Mrs. Castle: Will my right hon. Friend reconsider his decision not to hold an inquiry? Is he aware that when I was Secretary of State for Social Services I was ready to hold a public inquiry, but it seemed to all those interested at the time that the Press would be able to reveal the full facts? We now know that it is not possible, and that certain documents cannot be published. In view of the fact that this is the most serious drug tragedy in our history, can my right hon. Friend be absolutely sure, without holding a public inquiry, that we have learned all the lessons from this matter that will lead to our full protection?
    Mr. Ennals: I have such respect for my right hon. Friend that if ever she asks me to think about anything again, I agree to do so.

    Homeless Persons
    Mr. Laneasked the Secretary of State for the Social Services what further steps he proposes to take to tackle the problems of homeless young people.
    Mr. Ennals: I hope to be able to publish the report of the working group which has been considering these problems before the recess and I propose to consider further, in consultation with my colleagues and other interested parties, what steps can be taken at the present time, bearing in mind the need for restraint in public expenditure.
    Mr. Lane: Does the Secretary of State agree that it is now urgent that the Government should give an effective lead well before the winter? Could he at least give us an assurance that while resources must remain limited, help for

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    young homeless people will not be restricted further as a result of the recent review of public expenditure?
    Mr. Ennals: I shall make a statement on this matter before the Summer Recess, which means that hon. Members have only a few days to wait for this statement and the publication of the report. We do have to watch public expenditure very carefully. It would be wrong to imply that there should be some new responsibility for local authorities to carry out and new functions to fulfill if the funds are not provided to enable them to do so.
    Mr. Greville Janner: Will freedom from the new restrictions be given to areas of extreme stress rather than to individual groups in various circumstances? Will the Secretary of State consult the Minister for Housing, in particular, about the ways in which homeless young people can be protected from the forthcoming blast?
    Mr. Ennals: Yes, I shall do that. I have great concern for the problems of homeless people, having once been the Chairman of the Campaign for the Homeless and Rootless. These problems concern me very much, but I would rather refrain from comment until the report is published.
    Mrs. Chalker: What action will the Secretary of State take to persuade British Rail to reverse its decision about the siting of an information booth on Euston Station to help young people when they come to London? Will he press British Rail to set up a similar booth at Victoria Coach Station, in order to point young people in the right direction?
    Mr. Ennals: I am concerned about the decision taken by British Rail on this matter. The British Raliways Board wrote to the Home Office only on 20th July, and I am consulting with my hon. Friends about ways in which the difficulties put forward by the board can be met. It would be a great advantage if there were information centres at both Euston and Victoria Coach Station. The National Bus Company has been very co-operative about taking part in discussions on that proposal.

    Invalid Care Allowance
    Mr. Geoffrey Finsbergasked the Secretary of State for Social Services if he will make a statement on the take up of the invalid care allowance.
    Mr. Alfred Morris: I refer the hon. Member to my reply to the hon. Member for Rushcliffe (Mr. Clarke) on 12th July. We are continuing to take all suitable opportunities to underline the advantages of the new benefit. In this regard, I should like to emphasise again that the new allowance not only provides non-means-tested help where only means-tested benefits have been available hitherto, but also that those who are entitled to the allowance are credited with class 1 national insurance contributions.
    Mr. Finsberg: Naturally I am grateful for that reply. Can the Minister tell the House roughly the amount of public expenditure that would be involved if married women were brought into the scheme?
    Mr. Morris: I can only make a "guesstimate". My best guesstimate is that the additional cost would be about £25 million. I have said before that many hon. Members seem to believe that the sum of the parts can be greater than the whole. Those who want us to reduce the totality of public expenditure are the very people who want us to increase certain elements of it. They seem to believe that the whole is less than the sum of its parts.
    Mr. Ovenden: Many of the families affected by this new allowance are unsure of the right to claim this and the attendance allowance at the same time. What action is the Minister taking to make people aware of both entitlements?
    Mr. Morris: I have been in contact with hon. Members on both sides of the House in an attempt to get maximum publicity for the new benefit. My hon. Friend raises a very important point. The attendance allowance is payable in addition to the invalid care allowance. The mobility allowance is payable also to the same household, and there is an income disregard of £6 a week plus class 1 national insurance contributions. Some people have said, or implied, that we are

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    doing too much, but they should look at the alternative costs, both human and financial, of forcing people into institutions when they could otherwise live in the community.
    Mr. Kenneth Clarke: An Opposition Prayer on this matter has been on the Order Paper for some months. It was put down to give the House an opportunity to debate the Regulations and the problems arising from the new benefit before it came into payment. The Government are surely not trying to avoid a debate in this area in the same way as they are chopping more controversial debates. Will the Minister ask the Leader of the House to make time for a full and proper debate on this subject?
    Mr. Morris: We are certainly not seeking to avoid a debate on this benefit. I would welcome it. It is not for me to reply to the question of allocation of parliamentary time. The hon. Member has made his point, and no doubt my right hon. Friend the Leader of the House will take it fully into account.

    Family Income Supplement
    Mrs. Haymanasked the Secretary of State for Social Services if he will reduce to 24 hours the minimum working week for FIS claimants.
    The Under-Secretary of State for Health and Social Security (Mr. Eric Deakins): No, Sir. Family income supplement is intended to provide assistance to low-income working families in full-time work, and I have no intention of introducing a disincentive to full-time work. Assistance for low-income families unable to work full-time is available through the supplementary benefit scheme.
    Mrs. Hayman: Is the Minister aware that this is a very disappointing reply, particularly in view of replies given previously, which suggested that this idea was under active consideration. Is he aware that there are many families who would benefit from this, and that it would not be such an expensive reform for his Department? There would be a saving on supplementary benefit if a person with family responsibilities could claim family income supplement when he or she had a three-quarter-time job.
    Mr. Deakins: My hon. Friend may have misunderstood the situation. We are
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    considering a proposal, which was one of the suggestions of the Finer Committee, that there should be an easement in the number of hours of full-time work for FIS payment for one-parent families.
    Mr. McCrindle: Should not the Government cast aside their prejudices about the use of FIS and use it much more as an instrument to combat family poverty? Although this is a means-tested benefit, the fact is that it is paid to people in work. This is some sort of answer to the abuses of social security benefits of which we have seen so much recently.
    Mr. Deakins: We have taken steps to uprate FIS in line with the rise in the cost of living, but there are other ways of dealing with the problems of low incomes. One of these ways is to see that low pay is increased in many industries?
    Mr. Andrew F. Bennett: When does the Minister expect the consultations to which he has previously referred to be completed?
    Mr. Deakins: I am sorry to say they will not be completed this side of the Summer Recess, so I will not be able to make any announcement before the House rises. We have to consider this proposal, which is one with which we have a great deal of sympathy, but we also have to take account of public expenditure considerations.
    Sir B. Rhys Williams: Is not the right answer to bring in a generous child endowment and phase out means-tested benefits altogether?
    Mr. Deakins: In the long term, the answer will be the putting together of the social security system, the tax system, and the system of low pay. However, we do not have the time to do that just at the moment.

    Cash Credits
    Mr. Nicholas Wintertonasked the Secretary of State for Social Services if he will make a statement on his plans for the payment of cash credits in retirement.
    Mr. Orme: The Government have made a number of substantial improvements in benefits for the retired and have on the statute book a new scheme for earnings-related pensions. My right hon.

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    Friend has no other proposals at the present time.
    Mr. Winterton: I am grateful to the Minister for his reply, but has he read Labour's Programme for 1976, showing as it does proposals for cash benefits for those over retirement age? Does that not show a remarkable similarity to the tax credit scheme put forward by the Conservative Party?
    Mr. Orme: There are many excellent suggestions in Labour's programme for 1976. I am grateful to the hon. Gentleman for drawing the point to the attention of the House. The matter that he raises will have to be discussed in future policy, but there is no immediate intention to introduce such a scheme.
    Mr. R. C. Mitchell: Will my right hon. Friend add up all the requests for extra public expenditure made by the Opposition this afternon and publish the results in the Official Report?
    Mr. Orme: I am afraid that I would have to add a lot of noughts to the figures that we already have.
    Mr. Boscawen: Before the right hon. Gentleman adds any new benefits to the statute book, will he consider meeting the obligations promised to the pensioners in the Social Security Act 1975, to raise pensions in line with prices?
    Mr. Orme: The pensions increase this November will take pensions to their highest ever level and will cushion pensions against the effects of the current cost of living.
    Mr. Loyden: My right hon. Friend was asked what consideration was being given to additional benefits. Will he state what the Department intends to do to offset the effects of increased fuel costs on the aged and other groups, and what the Department can do in the forthcoming winter to alleviate the problem?
    Mr. Orme: There is a later Question on this subject on the Order Paper. The matter is under active consideration.

    Family Allowances
    Mr. Kenneth Clarkeasked the Secretary of State for Social Services what proposals he has for a publicity campaign to explain and invite claims for
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    the introduction of family allowances for the first child in April 1977.
    Mr. EnnalsAs the hon. Member will appreciate, family allowances will be abolished from next April and will be replaced by child benefit under the Child Benefit Act 1975. Only families who are not receiving family allowances now will have to claim child benefit for the first child. There will be an extensive publicity campaign, starting in the late summer, including national newspapers and magazine advertising, leaflets and posters.
    Mr. Clarke: Surely the Minister will not be advertising his proposals under the name of child benefit when they are really only the old taxed family allowance arrangements. Will he say when the working party set up by the Government with the TUC and the Labour Party will report, so that Parliament may be let back in on the act of deciding how best to get out of the Government's disastrous attempts to abandon the Child benefit scheme? Will he confirm, before the working party has reported, that the Prime Minister's first angry statement that nothing could be contemplated before 1979 is now completely abandoned by the Government?
    Mr. Ennals: The working party, which includes representatives of the Government, the TUC, the Parliamentary Labour Party and the national executive committee, has had a number of meetings. I hope that it will be possible to make known to the House its conclusions and any further conclusions that the Government may reach. The question of child benefit is due for consideration in the House on Friday, and I shall take the opportunity then of informing the House. On the first part of the question, of course the benefit that is being introduced next year for the first child is part of and flows from the Child Benefit Act. It is known that the Government are committed to the introduction in full of child benefit. This is the first step.
    Mr. D. E. Thomas: Since a mass advertising campaign is to take place later this year, will the right hon. Gentleman explain why that campaign could not have taken place earlier this year, because it would then have explained to the TUC and the unions generally the

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    relationship between the transfer from pay packet to purse which we have heard so much about?
    Mr. Ennals: The advertising later this year is designed to encourage families to apply for the benefit for the first child. It is not a political advertising campaign; it is a campaign designed to encourage all those who are entitled to child benefit to apply for it.
    Mr. Patrick Jenkin: Is it really the case that for this new family allowance scheme, the Government will use the same leaflet as would have been used for the real child benefit, putting in a correction slip to say that, after all, the tax allowances will not be withdrawn?
    Mr. Ennals: If that is another demand for additional public expenditure, I am very interested in the right hon. Gentleman's approach. We produced a leaflet of which 13 million copies were printed. If the right hon. Gentleman is suggesting that we should produce another leaflet, rather than use the existing one and include an information slip, he must accept that that would be extremely costly. He is asking for more public expenditure. The information slip drawing attention to the changes will be issued with the leaflet.
    Mrs. Castle: Does my right hon. Friend agree that the keynote of the child benefit scheme is the transfer from pay packet to purse in the interests of the mother? Would it not be extraordinarily confusing if my right hon. Friend insisted on continuing to call the extension of family allowances the introduction of child benefit? If he continues with the approach will he not make it much more difficult for us to educate people on what is involved in the child benefit scheme?
    Mr. Ennals: I am surprised that my right hon. Friend adopts that attitude, because both she and I are committed to the introduction in full of child benefits. She recognises that the first step is that which will be taken in April, that other steps will follow, and that this process should be seen by the public as progress towards full implementation of the Government's commitment to the child benefit scheme.

    Royal College of Nursing
    Mr. Fellasked the Secretary of State for Social Services if he will meet the Royal College of Nursing.
    Mr. Jim Spicerasked the Secretary of State for Social Services when he next intends to visit the Royal College of Nursing.
    Mr. Ennals: I met representatives of the Royal College of Nursing on 19th May and they know that I am very willing to meet them as and when there is need.
    Mr. Fell: How is the suggested growth rate of 6 per cent. in the district nursing service and the health visitors' service to be achieved within the present budget? Where will the nurses come from?
    Mr. Ennals: There is no problem about where the nurses will come from; there is a steady increase in the number of nurses and midwives in the NHS. It is estimated that in September this year there will be 20,000 more nurses and midwives, or their whole-time equivalent, than there were two years before. We do not have a problem in the recruitment of nurses, and there has been a good intake into nurses' training schools. I share the concern of all those who want to see a sufficient number of health visitors and district nurse tutors.
    Mr. Spicer: When the right hon. Gentleman meets the representatives of the Royal College, will he discuss with them the increasing tendency to bypass the joint consultative committees and for unilateral action to be taken by the trade unions, rather than their using these committees? This matter is of increasing concern to the Royal College and to all Members of this House and the public. Will the right hon. Gentleman consider giving guidance to the area health authorities on the action they should take when this practice occurs?
    Mr. Ennals: As I said in reply to the right hon. Member for Wanstead and Woodford (Mr. Jenkin) on 27th May, the present arrangements for local joint staff consultation committees in the NHS embodied in the general Whitley Council agreement do not distinguish between affiliated trade unions and professional

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    organisations. I understand that these arrangements are reflected in individual committees, but I am aware that there have been difficulties in a few places. My advice to the health authority is that since participation must be on an entirely voluntary basis it must negotiate with its staff the most effective arrangements appropriate to local circumstances.
    Mr. William Hamilton: Will my right hon. Friend tell the House what proportion of the total nursing personnel in the health service are coloured, from the New Commonwealth? Will he take advantage of this question to pay tribute to the noble work that they are doing?
    Mr. Ennals: I am afraid that I cannot give the figures. I am not certain whether they would be available from the lists of those who have been taken into employment. Colour is not a consideration. I pay warm tribute to the service given to the National Health Service by nurses from many parts of the world. I think that it has to be said that it would be difficult to provide the services in National Health Service hospitals today were it not for the admirable work done by people from many parts of the world, particularly from Commonwealth countries.
    Mrs. Chalker: Is the Secretary of State aware that he gave a weak answer to my hon. Friend the Member for Dorset, West (Mr. Spicer)? Is he further aware that there is extreme disquiet among nurses, who in some area health authorities are not even getting equal treatment with other employees in the National Health Service? Will he undertake to do something rather more positive about it than he has been able to do so far?
    Mr. Ennals: The hon. Lady is getting very worked up. I shall give an additional answer to that which I gave the hon. Member for Yarmouth (Mr. Fell). I have said that there continues to be a steady increase in the number of nurses in the National Health Service. The hon. Lady will know that the review of public expenditure shows a continuing expansion, or a continuing rate of growth, in the service. That includes nurses. No doubt the House, including the hon. Lady, will have noted, in the decision announced by my right hon. Friend the Chancellor of the Exchequer on public
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    expenditure cuts for 1977–78, that no inroad has been made into the revenue expenses of the National Health Service. They have been absolutely protected.

    Death Grant
    Mr. Dempseyasked the Secretary of State for Social Services if he will undertake a review of the rate of the death grant when the results of the Price Commission's survey of funeral costs are made known; and if he will make a statement.
    Mr. Deakins: I can assure my hon. Friend that the Government will have regard to the commission's findings, but any possible improvement in the rate of the death grant must necessarily be weighed against other competing claims on scarce resources.
    Mr. Dempsey: Is my hon. Friend aware that one of my constituents accepted responsibility for burying a deceased relative of no fixed abode, and that the funeral, consisting of a hearse, cortege, one car, the funeral parlour and crematorium expenses, amounted to £104, at early 1975 prices? All that she received was £30. In view of the high cost of dying, should not the grant be increased substantially and immediately?
    Mr. Deakins: The grant has never covered all the expenses connected with a funeral. Although it has been increased only twice since 1949, it still makes a modest contribution to the overall cost. If my hon. Friend's constituent had been on supplementary benefit or, alternatively, not in full-time work but with an income slightly above supplementary benefit level, she could have received assistance from the Supplementary Benefits Commission.
    Mr. George Rodgers: Is my hon. Friend aware that if a sick or elderly person died who had been befriended and cared for by a neighbour or friend rather than a relative, that person would not qualify for death grant? Does he not think that that is disgraceful?
    Mr. Deakins: That is bound to happen, because we have a contributory scheme for the death grant. If my hon. Friend is suggesting that we should replace the contributory death grant by a means-tested benefit, that is something that we should object to very strongly.

    Area Health Authorities
    Mr. Muddasked the Secretary of State for Social Services if he is considering any reorganisation plans for area health authorities.
    Mr. Ennals: No, Sir, but I have asked the area health authorities and the regional health authorities to consider ways of securing economies in their management costs. I await their proposals.
    Mr. Mudd: I thank the right hon. Gentleman for his reply, but does he not agree that the BMA is seeking to refer the junior hospital doctors' dispute to the Prime Minister? Does that not indicate the degree of malaise that exists and the profession's loss of faith in his Department, from his own level down to area health authorities?
    Mr. Ennals: I believe that it was a useful discussion that my right hon. Friend the Prime Minister, my right hon. Friend the Secretary of State for Employment and I had with the medical profession. It is true that it has a number of worries. Some of them are linked with the reorganisation of the Health Service, while some are linked with the inevitable difficulties of pay policy. There are other problems as well. These matters were raised with my right hon. Friend. It was an extremely productive and frank meeting. The mood of the meeting was helpful. I believe that it augurs well for the operation of bridge-building and for creating a better atmosphere between the Government and the profession, which is of vital importance.
    Mr. Christopher Price: Will my right hon. Friend take into account the special problems of area health authorities? The Lambeth, Lewisham and Southwark area, for example, has three teaching hospitals and the authority is now being called upon to take a balancing decision between teaching hospital costs and community hospitals, such as the Sydenham Children's Hospital, in my constituency.
    Mr. Ennals: There are such problems, and there are problems that arise from the redistribution of resources between regions to ensure that the deprived regions get a more adequate share of revenue funds than the better endowed ones. That
    244
    produces some problems, but it means that we are easing the problems in the boroughs that have been under-provided.
    Mr. Patrick Jenkin: Reverting to the question of junior doctors, does the right hon. Gentleman accept outside any question of pay policy, that some junior doctors will be worse off under the new contract? Will he now say publicly that there will be a no-detriment clause, so as to avoid that difficulty, which has given rise to much of the bitterness?
    Mr. Ennals: I do not think that it has given rise to much of the bitterness. I think that only a small number of doctors will be getting less than before under the new contract. My right hon. Friend the Prime Minister said that he would look into this question. We have to recognise that, on average, junior hospital doctors have received an increase of slightly under £800 from the new contract, compared with the previous one. That is a satisfactory settlement.

  MINISTERIAL BROADCASTS
  Mr. MacGregorasked the Prime Minister whether he intends to make a ministerial broadcast on his Government's economic policy.
  Mr. Ashleyasked the Prime Minister how many ministerial broadcasts he has made since he took office.
  Mr. Michael Lathamasked the Prime Minister whether he is now able to announce the date for his next ministerial broadcast.
  Mr. Stottasked the Prime Minister when he next plans to make a ministerial broadcast.
  The Prime Minister (Mr. James Callaghan): I have made one ministerial broadcast and will make another at an appropriate time.
  Mr. MacGregor: When he does so, and bearing in mind the importance of local authority expenditure in relation to the Government's economic policy, will the right hon. Gentleman make it clear that in relation to possible cutbacks in local authority grants next year he will not allow the Secretary of State for the Environment to pursue a policy of hitting

  245
  prudent local authorities instead of spendthrift authorities, which include many Labour-controlled ones—for example, Haringey? Would it not be wholly unfair that the prudent should suffer for the sins and actions of the spendthrift?
  The Prime Minister: I shall bear in mind the hon. Gentleman's suggestion for a broadcast, but I am not sure that that complicated subject will be best disposed of in the course of such a broadcast. There is a problem here, in that the Government have control, through loan sanction, over capital expenditure but not over local authority current expenditure. The word "spendthrift" is hardly the correct one to apply, because in many cases the local authorities concerned are meeting desirable and necessary social needs. However, it is clear that if some local authorities attempt to keep within the Government's recommended limits and others do not, a general block grant will bear unfairly on those who keep within the limits. That is the real problem that we should consider. Between now and next April my right hon. Friend will be able to have discussions about remedying it.
  Mr. Ashley: In his next broadcast, will my right hon. Friend take time off from refuting the economic nonsense talked by Opposition Members and by some of my hon. Friends and refer to the plight of one of the most underprivileged groups in Britain, namely, the single-parent families? Does he realise that there are no fewer than nine Ministers grappling with the 230 recommendations of the Finer Report, and that they are not doing very well at it? In fact, I believe that they are butchering the report, and that my right hon. Friend's personal intervention is required so as to get the nine Ministers to undertake collective action to try to help single-parent families.
  The Prime Minister: I am obliged to my hon. Friend. I have not personally looked at this matter, but I undertake to do so in the long weeks of the recess that lie ahead, when I shall have a chance to reflect on more constructive aspects of Government policy than we hear from Opposition Members.
  Mr. Latham: Has not the existing scheme, under which building societies
  246
  are supposed to make up the Government cut-back in local authority mortgages, proved a complete farce? Why, therefore, are the Government doing it all over again? Why does not the Prime Minister make a broadcast to tell the simple truth, which is that the Government have cut the housing programme?
  The Prime Minister: The Secretary of State for the Environment and the building societies had a meeting last week and, I believe, issued a joint statement on the way in which they will try to help would-be house owners. As I read the statement, it seemed to me to be very satisfactory, and I hope that the building societies will carry it out.
  Mr. Bidwell: Does my right hon. Friend agree that for supporters of the Labour movement the real test of the economic management of Britain is whether the Government can get down the present rate of unemployment and, if necessary, engage in greater public expenditure to tackle it, as capitalism and non-Socialist measures certainly cannot?
  The Prime Minister: My hon. Friend is right in saying that we regard the present level of unemployment as too high. I hope that before the House rises my right hon. Friend the Secretary of State for Employment will be able to bring forward further measures for tackling unemployment, so as to help the situation.
  Mr. David Steel: Will the Prime Minisster explain, in a broadcast or by some other means, why the increased payroll tax will not be regionally varied to take account of the different unemployment position in different parts of the country?
  The Prime Minister: No, Sir, I do not think that I shall be able to explain that in a ministerial broadcast. The Cabinet took a decision that it should apply nationally.
  Mrs. Thatcher: As the Prime Minister's Government have just announced a payroll tax of £1,000 million, at a time of record unemployment, will the Prime Minister in his next ministerial broadcast tell the nation who it was who said that such a payroll tax would both intensify the depression and increase the growth of unemployment? Does he still agree with that view?
  The Prime Minister: I rather suspect that that is a catch question. I might have said it myself some time ago.
  Mrs. Thatcher indicated dissent.
  The Prime Minister: Thank heavens for that. I thought that one of my past misdeeds as Chancellor of the Exchequer was coming out. I shall wait with bated breath to hear who said it, and then I shall know what value to place upon it. The Chancellor put forward the proposal because he thought that it was the best way of meeting the objective that has been pressed upon us by the Opposition, namely—[Interruption.]—Hon. Members have not yet heard what the objective is—namely, to reduce the borrowing requirement, and this is one way of doing it.
  Mrs. Thatcher: If I may put the Prime Minister out of his misery, the words were said by the right hon. Member for Huyton (Sir H. Wilson) when he was shadow Chancellor, shortly before the Prime Minister took over from him as shadow Chancellor, at a time when unemployment was only 321,000, under a Conservative Government. Now, unemployment is nearly 1½ million. Surely, when he imposes a payroll tax at that level the Prime Minister cannot escape the charge of his party being the natural party of unemployment?
  The Prime Minister: The right hon. Lady is too young to be living in the past like this. It is all very well for me to reminisce, but it is not for the right hon. Lady to do so. [HON. MEMBERS: "Answer."] That is only the hors d'oeuvre; we are coming to the meat. On the serious part of the supplementary question about the level of unemployment, the right hon. Lady has a real point of substance when she says that no Government should be proud of the level of unemployment in this country, a problem that is shared—I do not use this as an excuse, but it is a factor that should be taken into account—throughout the Western industrial world. We are struggling to overcome it, and I trust that we shall do so. But there are always conflicting objects and objectives of any policy. My aim and that of the Government is that we should endeavour, by means of the combined approach we are making with other Gov-
  248
  ernments and by our own actions, to reduce unemployment to 3 per cent. by 1979—and I hope that we shall get general support for that policy.

BRADFORD
Mr. Cryerasked the Prime Minister if he will pay an official visit to Bradford.
The Prime Minister: I have at present no plans to do so.
Mr. Cryer: Does my right hon. Friend accept that he would be very welcome, especially in Keighley? Will he say how the proposed public expenditure cuts will affect Bradford, whose textile industry is already deeply troubled because of the lack of proper import controls? Will he also explain how expenditure cuts will help to regenerate British industry when the announcement has caused the CBI to announce a strike of capital? What will my right hon. Friend do to answer the CBI?
The Prime Minister: I know the position of Bradford; I looked it up specially in anticipation of this supplementary question. It is true that the textile and clothing industries are being protected both by EEC agreements negotiated over the past 18 months under the GATT Multi-Fibre Arrangement and by others. We have reinforced these agreements in particular cases by our own controls against cotton yarn from Portugal, Spain, Greece and Turkey, and woollen suits from Eastern Europe. I am told that this means that virtually all disruptive imports of textiles and clothing from low-cost sources are now subject to control.
The Chancellor indicated in his statement that either he or the Secretary of State for Trade would be very willing to discuss this matter further with the industry. I wish to emphasise that there should be no ideological objection to import controls in the present situation. They stand under the general lines of policy that we have indicated before. We do not refute them as a matter of ideology, although we believe that, on balance, the world is better off if it can do without them.
In reply to the second part of the supplementary question, I was disappointed with Lord Watkinson's reaction on the

249
question of investment by industry. I had thought that we should get a different response from him, but I hope to be having conversations with him about it.
Mr. Baker: Will the Prime Minister tell the House—as he is now a latter-day convert to open government—what in any event we shall learn from the Treasury in two or three months' time, namely, how much standby credit has been used to support the pound?
The Prime Minister: I am not overly a convert to open Government. I think that it has its place. For example, there are secrets that are better kept within the family, for several reasons. On the general issue—I am sorry, what was it?
Mr. Baker: Standby credit.
The Prime Minister: I wanted to dismiss it from my mind. It was a clear case of a Freudian slip. As the hon. Gentleman knows, these matters are published under well-defined rules, and it does not help the position of currencies that are under attack—whether it be the franc, sterling or any other currency—for day-to-day attention to be concentrated on them. What is needed now is a period of steadiness in the money market.
Mr. MacFarquhar: Whether or not my right hon. Friend goes to Bradford, will he spend the Summer Reces totting up the suggestions for public expenditure cuts made by the Conservative Party, to see which is the natural party of unemployment from the consequences of those suggestions?
The Prime Minister: On the whole, do not think that Question Time is a fruitful time in which to attack the Opposition. It is their job to attack me.
This afternoon in Question Time I listened to demands for additional expenditure on at least three different objects. The child benefit scheme was one. [Interruption.] The Opposition cannot speak for those who ask the questions. I was here during Question Time. Some of those who now interrupt me were not present then.
Invalidity benefit was another object of the proposed increased expenditure. The third escapes me for the moment, but there were at least three proposals this afternoon.
250
I add to that the speech that we are promised by the Leader of the Opposition at the weekend, calling for additional defence expenditure. I am waiting with great interest to read that. I add to that the fact that the Opposition spokesman for research policy is in favour of a much larger amount of unemployment. I think that the nation will soon be able to draw its own conclusions about the hypocrisy of the Opposition.
Mr. Prior: Will the Prime Minister give guidance for his view that the Conservative Party spokesman for research is in favour of high unemployment, in view of the fact that my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) told the Government in 1974 that if they did not cut public expenditure unemployment would go up? Since that time, unemployment has doubled.
The Prime Minister: Yes, Sir; the evidence is contained in the right hon. Gentleman's speech, which was reported in the Sunday Telegraph.
Several hon. Members rose—
Mr. Speaker: Order. Question Time is now over.

SECONDARY EDUCATION (TAMESIDE)
Mr. Christopher Price: On a point of order, Mr. Speaker. In view of the perverse and misguided decision of the Court of Appeal yesterday, has the Prime Minister—
Mr. Speaker: Order. That matter is sub judice. I should have thought that the hon. Member would realise that.
Mr. Christopher Price rose—
Mr. Speaker: Order. There may be no further point of order on that matter.
Mr. Christopher Price: On another point of order, Mr. Speaker—
Mr. Speaker: Order. If this point of order is on an entirely different subject I shall take it, but I shall not take a point of order on Tameside.
Mr. Christopher Price: On a point of order, Mr. Speaker. I do not wish to mention Tameside. I did wish—
Mr. Speaker: I hope that the hon. Member will not try to skirt round the

251
question, as that would be of no use to the House. There is a great deal of business. There is a timetable motion. We must be fair and get on to the business as quickly as possible.
Mr. Christopher Price: Further to that point of order, Mr. Speaker—
Mr. Speaker: Order. The hon. Member knows that he cannot raise any point relating to Tameside this afternoon.
Mr. Christopher Price: I shall not mention Tameside.
In 1972 the Select Committee on Procedure introduced into the House a motion, which was passed, about sub judice rules which required you, Mr. Speaker, to take those rules into account in taking decisions about whether matters could be commented on. I have a submission to make that the Tameside case—
Mr. Speaker: Order. First, I have not come to the House unprepared. I have spent some time considering this matter. I am not prepared to take points on that issue. The hon. Member had best try another occasion on which to raise the matter.
Mr. John Mendelson: On a point of order, Mr. Speaker. Surely there have been occasions within your memory, and within those of all Members of Parliament, when an hon. Member has been allowed at least to make a submission and state his case in general terms before the Chair made the decision whether he was allowed to make a submission. [HON. MEMBERS: "No."] May I continue? I have not finished my point of order. I am not in the habit of making points of order every Monday and every Friday. I have not finished my point of order today and I intend to finish it if the Chair allows me to do so.
On numerous occasions hon. Members been allowed to make submissions. The Chair has not said that as the matter had been studied by the Chair the submission could not be heard. I therefore respectfully ask you, Mr. Speaker, to accord the same right to my hon. Friend the Member for Lewisham, West (Mr. Price).
Mr. Skinner: On a point of order, Mr. Speaker. Before you make a ruling on that matter, Mr. Speaker, I should like,
252
in line with what my hon. Friend the Member for Penistone (Mr. Mendelson) said, to say that there have been many similar examples during the period that I have been a Member of this House. I should like to draw your attention specifically to the fact that during a not dissimilar incident—namely local authorities versus central Government—I was to some extent involved in the Clay Cross affair. Lord Denning was also involved, although he came to a different conclusion on that occasion. But the point I want you to remember, Mr. Speaker, is this—
Mr. Speaker rose—
Mr. Skinner: When this matter—
Mr. Speaker: Order. The hon. Member should resume his seat when I stand. I want the hon. Member to state his point of order as politely as he can.
Mr. Skinner: One thing is certain. I shall not grovel.
Whether or not the Clay Cross matter was sub judice, during its course it was nevertheless mentioned time and time again in this Chamber, despite the fact that the case went to the same people. It went to Lord Denning. It went through the same process as this matter. I believe that it should be a matter for our concern in this Chamber.
Mr. Speaker: I am much obliged to the hon. Member and to the others who have made their points of order. The House has given me discretion in this matter. I am exercising that discretion. There can be no question this afternoon of my changing my mind on it.

STATUTORY INSTRUMENTS, &c.
Mr. Speaker: To save the time of the House, I propose, unless there is an objection, to put the Questions on the five motions relating to Statutory Instruments together.
Ordered,
That the Draft Weights and Measures Act 1963 (Bread) Order 1976 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Foot.]
That the Draft Weights and Measures Act 1963 (Tea) Order 1976 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Foot.]

253
That the Draft Weights and Measures (Flour and Oat Products) (Exemption) Order 1976 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Foot.]
That the Draft Weights and Measures (Potatoes) (Exemption) Order 1976 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Foot.]
That the Anti-Dumping Duty (No. 2) Order 1976 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Foot.]

NATIONAL SERVICE
3.38 p.m.
Mr. Anthony Steen (Liverpool, Waver-tree): I beg to move,
that leave be given to bring in a Bill to train unemployed school leavers by creating new opportunities to involve them in neighbourhood work, community care and service to others.
Mr. Michael English: On a point of order, Mr. Speaker. Would the hon. Member for Liverpool, Wavertree (Mr. Steen), who is introducing the Bill, assure us that in this case the Bill—unlike the three Bills which he has previously introduced in this Session—will eventually, if the House gives leave, be printed?
Mr. Steen: I took instructions, knowing of the hon. Gentleman's objections. I gather that it is normal to print the Bills. I took the view that as my Bills were unlikely to reach the statute book it was a waste of public expenditure to cause them to be printed.
Mr. Speaker: May I help the hon. Gentleman? He can help the House if he will get to his Ten-Minute Bill as quickly as he can, because there is a timetable motion before the House.
Mr. Steen: There is growing suspicion as to the Government's intentions about tackling unemployment among school leavers. The Government protest too much. They say they are doing all that is possible. They say it is a short-term problem. They say that it will go away. It will not.
The statistics tell the story. In August 1970, 39,000 school leavers were registered as unemployed. Under the Tory Administration, the figures stayed fairly constant, dropping in August 1973 to 23,000. They started to rise again under Labour. In 1974, 59,000 school leavers were unemployed. In 1975, 165,000 school leavers were unemployed. In July of this year, 209,000 school leavers were unemployed. The figure will go higher.
What are the Government doing? One can give them credit for only one thing. They are experts in spending other people's money, because £415 million has already been frittered away on palliatives. When will the Government acknowledge some fundamental truths?

255
First, the Government must stop playing the rôle of father figure—
Mr. Robert Mellish: On a point of order, Mr. Speaker. I understood that the hon. Gentleman got up to move a Ten-Minute Bill. All I have heard so far is an abuse of the privilege of introducing a Bill. The hon. Gentleman has made a direct attack on Government policy. If that is to be the procedure, Mr. Speaker, it will mean that the Ten-Minute Bill procedure will be constantly abused by hon. Members on both sides. That would be a very sad thing. I have not heard a word yet as to what the Bill is about.
Mr. Speaker: Order. I am quite sure that the hon. Gentleman will now outline the purposes of his Bill.
Mr. Steen: I hope that the interruption will not be counted against my 10 minutes.
The Government must stop playing the rôle of father figure, overlord and provider. This not only undermines the work ethic but robs the young of their independence and sense of initiative. [Interruption.] If you bothered to listen you might learn something.
Mr. Speaker: Order. I am listening but I do not know whether I am learning. Would the hon. Gentleman be kind enough to outline the purposes of his Bill? I know that he wants to be fair to the House.
Mr. Steen: The National Service Bill aims to eliminate the damage currently being done by the Government to school leavers, by giving them something meaningful and relevant to do, and on their own terms.
The Bill has a three-pronged attack. The first prong is to establish a national initiative programme run by the young themselves, giving every school leaver the chance to create his own work experience either by personal social service or by undertaking practical community work to improve the quality of life and the facilities in his neighbourhood. The possibilities are infinite. Every hon. Member will know the social distress and needs in his constituency which could be tackled to improve the quality of life there.
256
The second prong is for the Government to appeal by direct advertisement through the media, laying down a challenge to the whole community. Industry, small business and individuals alike would be asked to make available opportunities for job training and learning experience for young people. It would be an appeal to every citizen to involve young people in his work.
The third prong—
Mr. Bob Cryer: On a point of order, Mr. Speaker. Is it in order for an hon. Member to introduce a Ten-Minute Rule Bill and to say what is going into the Bill, when the same hon. Member has already introduced three such Bills which have never seen the light of day? Not a single printed Bill has appeared. Is not the hon. Gentleman using the House as a means for getting across meaningless verbiage? If hon. Members are really concerned and serious, the Ten-Minute Rule procedure can result—as it has in the past—in Bills being put on the statute book. May we ask you, Mr. Speaker, to protect the House? Cannot the hon. Member be asked whether he intends to produce a Bill?
Mr. James Prior: On a point of order, Mr. Speaker. Is it not a gross abuse of the procedure of the House that Government Members should seek to interrupt my hon. Friend by bogus points of order? Should they not leave to the Chair the decision whether my hon. Friend is in order, instead of themselves raising bogus points of order?
Mr. English: Further to that point of order, Mr. Speaker. I remarked on Friday 16th July that the hon. Member's three previous Bills could not be objected to because they have never been put forward in print, but some six weeks before that, because I could not find him, I informed his Whips that I would raise the issue. I pointed out that he had six weeks in which to present any one of those three Bills. I have had letters from constituents—as, no doubt, have other hon. Members—asking where the hon. Member's Bills are. These constituents believe that the Bills exist because leave was given by the House to introduce them. [HON. MEMBERS: "Where are they?"] I am sorry to take up the time

257
of the House. May I suggest to the hon. Gentleman—
Mr. Speaker: Order. Whether previous Bills have been printed is not a matter for me. The Ten-Minute Bill procedure is quite straightforward. It is not unknown for it to be used as a means of putting forward a specific point of view which is not acceptable on all sides of the House. I have known this to be done by hon. Members on both sides of the House. But the argument must be directed to the terms of the Bill that the hon. Gentleman is seeking leave to introduce. It must not be a general debate on Government policy or anything else.
Mr. Norman Buchan: On a point of order, Mr. Speaker. If I understood your ruling correctly, you said that it was in order to use the Ten-Minute Bill procedure to put forward a point of view, and not necessarily, therefore, in order to produce a Bill. Did you, in fact, mean that, Mr. Speaker?
Mr. Speaker: If the hon. Gentleman gained that impression from what I said, I clearly was not expressing myself as forcibly as I should. But within the context of a Ten-Minute Bill there is often controversy. That is why such Bills are often opposed. I ask the hon. Member for Liverpool, Wavertree (Mr. Steen) to realise that he is taking the time of the House. The points of order are also taking a lot of time.
Mr. English: On a point of order, Mr. Speaker. The right hon. Member for Lowestoft (Mr. Prior) by implication accused Members of discourtesy. May I point out that there have been no points of order interrupting other Members who have introduced Ten-Minute Bills, even if they were regarded as controversial?
Mr. Kenneth Lewis: On a point of order, Mr. Speaker. May I quickly correct—
Mr. Speaker: May I seek to help the hon. Gentleman? I hope that he has a genuine point of order. Correcting other Members' points of order is my responsibility, not his.
Mr. Kenneth Lewis: On a point of order, Mr. Speaker. May I simply say that last week I raised a point of order on a Ten-Minute Bill and was shot down
258
about three times in quick succession. [Interruption.]
Mr. Speaker: Order.
Several hon. Members rose—
Mr. Speaker: Order. The House is getting very unruly. May we continue the Ten-Minute Bill? Mr. Steen.
Mr. Steen: It is important that we correct the record because hon. Members opposite have given an incorrect view. They have said that three Bills have been introduced. Only one Bill has been introduced on unemployment and that had nothing to do with the subject which I am discussing this afternoon. I wish to ask that leave be given to introduce this Bill.
3.50 p.m.
Mr. Neil Kinnock rose—
Mr. Speaker: Is the hon. Member rising to oppose the Bill?
Mr. Kinnock: Yes, Mr. Speaker. I shall speak with great brevity, especially since the hon. Member's remarks, though abbreviated, were still much too long for common sense. He spent the first few minutes of his introduction to the Bill on a general and, in terms of the rules of order of this House, over which you preside, Mr. Speaker, highly objectionable use of the Ten-Minutes Rule Bill procedure for the purpose of a partisan attack. [Interruption.]
Mr. Speaker: Order. Mr. Burden, on a point of order.
Mr. F. A. Burden: On a point of order, Mr. Speaker. When Ten-Minute Rule Bills are introduced, hon. Members on either side of the House who object to them should divide the House and show their opposition in the Lobby rather than raise bogus points of order.
Mr. Speaker: That is the old-fashioned way and it has worked very well.
Mr. Kinnock: You and I are both old-fashioned boys, Mr. Speaker. Though I could not be thought of as perhaps one of the least partisan Members of the House, it appears to me that we shall be going off at something of a tangent if, generally speaking, we use the Ten-Minute Rule Bill procedure for that purpose.

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If I may speak specifically on the question of an initiative programme, at very best it sounds like an echo of a 1930 semi-Fascist corporate State programme, and at very worst it is a genuine Fascist corporate State programme. The idea of using public resources to issue challenges—and what a virile sounding word "challenge" is?—to the community to help youngsters in this way is a most outrageous misinterpretation of the situation that confronts unemployed young people in Britain today. They do not want this kind of help. They do not want the hon. Member for Liverpool, Wavertree (Mr. Steen) or anybody else to manufacture synthetic employment opportunities for them, nor do they want to enjoy national

Division No. 281.]

AYES

3.54 p.m.

Adley, Robert

Harrison, Col Sir Harwood (Eye)

Neubert, Michael

Banks, Robert

Hastings, Stephen

Normanton, Tom

Beith, A. J.

Hawkins, Paul

Osborn, John

Benyon, W.

Hayhoe, Barney

Page, John (Harrow West)

Berry, Hon Anthony

Heseltine, Michael

Page, Rt Hon R. Graham (Crosby)

Biggs-Davison, John

Higgins, Terence L.

Paisley, Rev Ian

Blaker, Peter

Holland, Philip

Pardoe, John

Boscawen, Hon Robert

Hordern, Peter

Parkinson, Cecil

Bottomley, Peter

Hunt, David (Wirral)

Peyton, Rt Hon John

Bowden, A. (Brighton, Kemptown)

Hunt, John (Bromley)

Price, David (Eastleigh)

Boyson, Dr Rhodes (Brent)

Hurd, Douglas

Prior, Rt Hon James

Buchanan-Smith, Alick

Hutchison, Michael Clark

Pym, Rt Hon Francis

Buck, Antony

Irving, Charles (Cheltenham)

Rathbone, Tim

Budgen, Nick

James, David

Rees-Davies, W. R.

Burden, F. A.

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

Renton, Tim (Mid-Sussex)

Butler, Adam (Bosworth)

Jessel, Toby

Rhys Williams, Sir Brandon

Carlisle, Mark

Kellett-Bowman, Mrs Elaine

Roberts, Michael (Cardiff NW)

Chalker, Mrs Lynda

Kershaw, Anthony

Roberts, Wyn (Conway)

Clark, William (Croydon S)

Kimball, Marcus

Ross, Stephen (Isle of Wight)

Clarke, Kenneth (Rushcliffe)

King, Tom (Bridgwater)

Ross, William (Londonderry)

Cockcroft, John

Kitson, Sir Timothy

Rossi, Hugh (Hornsey)

Cooke, Robert (Bristol W)

Knight, Mrs Jill

Rost, Peter (SE Derbyshire)

Cope, John

Langford-Holt, Sir John

St. John-Stevas, Norman

Cordle, John H.

Latham, Michael (Melton)

Scolt-Hopkins, James

Cormack, Patrick

Lawrence, Ivan

Sims, Roger

Corrie, John

Lawson, Nigel

Sinclair, Sir George

Costain, A. P.

Le Marchant, Spencer

Skeet, T. H. H.

Craig, Rt Hon W. (Belfast E)

Lester, Jim (Beeston)

Speed, Keith

Crouch, David

Lewis, Kenneth (Rutland)

Spicer, Michael (S Worcester)

Douglas-Hamilton, Lord James

Lloyd, Ian

Sproat, Iain

Eden, Rt Hon Sir John

Luce, Richard

Steel, David (Roxburgh)

Eyre, Reginald

McCrindle, Robert

Stradling Thomas, J.

Fairbairn, Nicholas

MacGregor, John

Thatcher, Rt Hon Margaret

Fairgrieve, Russell

McNair-Wilson, M. (Newbury)

Thorpe, Rt Hon Jeremy (N Devon)

Finsberg, Geoffrey

Madel, David

Tugendhat, Christopher

Fletcher, Alex (Edinburgh N)

Mates, Michael

Wainwright, Richard (Colne V)

Gardiner, George (Reigate)

Mather, Carol

Wakeham, John

Gilmour, Sir John (East Fife)

Maudling, Rt Hon Reginald

Walker, Rt Hon P. (Worcester)

Godber, Rt Hon Joseph

Mawby, Ray

Walters, Dennis

Goodhart, Philip

Maxwell-Hyslop, Robin

Warren, Kenneth

Goodhew, Victor

Miller, Hal (Bromsgrove)

Weatherill, Bernard

Gow, Ian (Eastbourne)

Mills, Peter

Wiggin, Jerry

Gower, Sir Raymond (Barry)

Monro, Hector

Younger, Hon George

Gray, Hamish

More, Jasper (Ludlow)

Griffiths, Eldon

Morgan, Geraint

TELLERS FOR THE AYES:

Grimond, Rt Hon J.

Morrison, Hon Peter (Chester)

Mr. Anthony Steen and

Hampson, Dr Keith

Mudd, David

Mr. Leon Brittan.

Hannam, John

Neave, Airey

NOES

Allaun, Frank

Armstrong, Ernest

Atkinson, Norman

Anderson, Donald

Ashley, Jack

Bagier, Gordon A. T.

Archer, Peter

Ashton, Joe

Bates, Alf

charity. They want real work, and if the hon. Gentleman were interested in that he would not be engaging himself in stupid abuses of the House such as this, or in any other gimmick, using his constituents for purposes of personal propaganda. He would be on this side of the House, against hon. Gentlemen opposite, striving to reflate the economy so that working-class youngsters in our society could have real work to do.
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 139, Noes 183.

Bean, R. E.

Hayman, Mrs Helene

Price, William (Rugby)

Benn, Rt Hon Anthony Wedgwood

Heffer, Eric S.

Reid, George

Bennett, Andrew (Stockport N)

Henderson, Douglas

Richardson, Miss Jo

Bidwell, Sydney

Hooley, Frank

Roberts, Albert (Normanton)

Bishop, E. S.

Hoyle, Doug (Nelson)

Roberts, Gwilym (Cannock)

Booth, Rt Hon Albert

Huckfield, Les

Robinson, Geoffrey

Boothroyd, Miss Betty

Hughes, Mark (Durham)

Roderick, Caerwyn

Bottomley, Rt Hon Arthur

Hughes, Robert (Aberdeen N)

Rodgers, George (Chorley)

Buchan, Norman

Hunter, Adam

Rooker, J. W.

Butler, Mrs Joyce (Wood Green)

Jackson, Colin (Brighouse)

Rowlands, Ted

Canavan, Dennis

Jackson, Miss Margaret (Lincoln)

Sandelson, Neville

Carmichael, Neil

Jay, Rt Hon Douglas

Sedgemore, Brian

Carter, Ray

Jenkins, Hugh (Putney)

Selby, Harry

Cocks, Michael (Bristol S)

John, Brynmor

Shaw, Arnold (Ilford South)

Coleman, Donald

Johnson, Walter (Derby S)

Sheldon, Robert (Ashton-u-Lyne)

Colquhoun, Ms Maureen

Jones, Dan (Burnley)

Short, Rt Hon E. (Newcastle C)

Conlan, Bernard

Kaufman, Gerald

Short, Mrs Renée (Wolv NE)

Corbett, Robin

Kelley, Richard

Silkin, Rt Hon S. C. (Dulwich)

Cox, Thomas (Tooting)

Kilroy-Silk, Robert

Sillars, James

Crawford, Douglas

Kinnock, Neil

Silverman, Julius

Crowther, Stan (Rotherham)

Lambie, David

Skinner, Dennis

Cryer, Bob

Latham, Arthur (Paddington)

Small, William

Cunningham, Dr J. (Whiteh)

Leadbitter, Ted

Snape, Peter

Dalyell, Tam

Lewis, Ron (Carlisle)

Spriggs, Leslie

Davidson, Arthur

Loyden, Eddie

Stallard, A. W.

Davies, Bryan (Enfield N)

Luard, Evan

Stewart, Rt Hon M. (Fulham)

Davies, Denzil (Llanelli)

Lyons, Edward (Bradford W)

Stoddart, David

Dean, Joseph (Leeds West)

Mabon, Dr J. Dickson

Stott, Roger

Dempsey, James

McCartney, Hugh

Strang, Gavin

Dormand, J. D.

McDonald, Miss Oonagh

Summerskill, Hon Dr Shirley

Dunn, James A.

Mackenzie, Gregor

Swain, Thomas

Dunwoody, Mrs Gwyneth

Maclennan, Robert

Taylor, Mrs Ann (Bolton W)

Eadie, Alex

McMillan, Tom (Glasgow C)

Thomas, Dafydd (Merioneth)

Edge, Geoff

Madden, Max

Thomas, Ron (Bristol NW)

Edwards Robert (Wolv SE)

Magee, Bryan

Thompson, George

Ellis, John (Brigg & Scun)

Mahon, Simon

Tinn, James

Ellis, Tom (Wrexham)

Mallalieu, J. P. W.

Tomlinson, John

English, Michael

Maynard, Miss Joan

Torney, Tom

Evans, Fred (Caerphilly)

Hellish, Rt Hon Robert

Urwin, T. W.

Evans, Gwynfor (Carmarthen)

Mendelson, John

Varley, Rt Hon Eric G.

Evans, John (Newton)

Mikardo, Ian

Wainwright, Edwin (Dearne V)

Ewing, Harry (Stirling)

Millan, Bruce

Walker, Terry (Kingswood)

Fernyhough, Rt Hon E.

Miller, Dr M. S. (E Kilbride)

Ward, Michael

Fitt, Gerard (Belfast W)

Miller, Mrs Millie (Ilford N)

Watkins, David

Flannery, Martin

Mitchell, R. C. (Solon, Itchen)

Watkinson, John

Fletcher, L. R. (Ilkeston)

Morris, Alfred (Wythenshawe)

Weitzman, David

Fletcher, Ted (Darlington)

Morris, Charles R. (Openshaw)

White, Frank R. (Bury)

Foot, Rt Hon Michael

Moyle, Roland

Whitehead, Phillip

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

Murray, Rt Hon Ronald King

Wigley, Dafydd

Garrett, John (Norwich S)

Newens, Stanley

Williams, Alan Lee (Hornch'ch)

Garrett, W. E. (Wallsend)

Noble, Mike

Wilson, Alexander (Hamilton)

Goldlng, John

Orme, Rt Hon Stanley

Wise, Mrs Audrey

Gould, Bryan

Ovenden, John

Woodall, Alec

Gourlay, Harry

Padley, Walter

Wrigglesworth, Ian

Grant, George (Morpeth)

Palmer, Arthur

Young, David (Bolton E)

Grant, John (Islington C)

Park, George

Hamilton, W. W. (Central Fife)

Parry, Robert

TELLERS FOR THE NOES:

Hardy, Peter

Prescott, John

Mr. Russell Kerr and

Hart, Rt Hon Judith

Price, C. (Lewisham W)

Mr. Stan Thorne.

Question accordingly negatived.
Mr. English: On a point of order, Mr. Speaker. May I ask your assistance on behalf of the House? You are in charge of the Clerks of the House, and I ask you whether, after consultation with the Leader of the House and the Shadow Leader of the House, you will make it clear that the House has made it plain that it does not wish to give leave to introduce Bills that in fact are never
262
introduced, even on subjects in respect of which it might be sympathetic. May I ask you to have the appropriate consultations to see that this practice does not occur again?
Mr. Speaker: This is another matter that could be referred to the Procedure Committee. It is not a matter for me. The sooner the Procedure Committee starts work, the better.

AIRCRAFT AND SHIPBUILDING INDUSTRIES BILL (ALLOCATION OF TIME)
Ordered,
That the Report [22nd July] of the Business Committee be now considered.—[Mr. Coleman.]
Report considered accordingly.
That the allotted days which under the Order [20th July] are given to the Proceedings on Consideration and Third Reading shall be allotted in the manner shown in the Table set out below, and, subject to the Provision of that Order, each part of the Proceedings shall, if not previously brought to a conclusion, be brought to a conclusion at the time specified in the third column of the Table:

TABLE

Allotted day

Proceedings

Time for conclusion of Proceedings

First day

Re-committal

6.00 p.m.

New Clauses 1 to 4

8.00 p.m.

Remaining New Clauses and Amendments to Clause 1

11.00 p.m.

Second day

Amendments to Clause 2 up to and including any Amend ments to line 11 on page 4

6.00 p.m.

Amendments to Clauses 2 to 18 so far as not already disposed of

11.00 p.m.

Third day

Amendments to Clauses 19 to 55 and Schedule 1, and Amendments to Schedule 2 down to and including any Amendment to line 14 on page 75

6.00 p.m.

Any Amendments down to the end of line 18 on page 75

7.40 p.m.

Any Amendments down to the end of line 19 on page 75

8.00 p.m.

Any Amendments down to the end of line 27 on page 75

8.20 p.m.

Any Amendments down to the end of line 4 on page 77

8.40 p.m.

Any Amendments to insert words at the end of line 4 on page 77

9.00 p.m.

Remaining Amendments to Schedule 2 and Amendments to Schedules 3 to 7

9.20 p.m.

Third Reading

11.00 p.m.

Question,
That this House doth agree with the Committee in their Resolution.—[Mr. Coleman.]
put forthwith, pursuant to Standing Order No. 43 (Business Committee), and agreed to.
Following is the report of the Business Committee:

ORDERS OF THE DAY

  AIRCRAFT AND SHIPBUILDING INDUSTRIES BILL
  [1ST ALLOTTED DAY]
  Order for consideration as amended (in the Standing Committee), read.
  Ordered,
  That the Bill be recommitted to a Committee of the whole House in respect of the following Amendments standing on the Notice Paper in the name of Mr. Secretary Varley, namely—

  (a) the Amendment in Schedule 1 at page 74, line 29; and

  (b) the Amendments in Schedule 2 at—

  page 76, line 41;
  page 77, line 39; and
  page 78, line 2.—[Mr. Varley.]
  Bill immediately considered in Committee.
  [Mr. OSCAR MURTON in the Chair]

  AIRCRAFT AND SHIPBUILDING INDUSTRIES BILL
    Schedule 1

      AIRCRAFT INDUSTRY
      4.8 p.m.
      The Secretary of State for Industry (Mr. Eric Varley): I beg to move Amendment No. 1, in page 74, line 29, leave out 'include rotary-wing aircraft' and insert
      'include—

      (a) hovercraft;

      (b) lighter than air aircraft;

      (c) rotary-wing aircraft;

      (d) non-motorised and motorised gliders;

      (e) aircraft designed to fly unmanned; and

      (f) replicas of aircraft of historic interest.'.

      The Chairman: With this we may take Government Amendments Nos. 2, 3 and 4.
      Mr. Varley: I do not think that I need to spend much time on this group of amendments as the principal reasons for tabling them have already been debated at some length on previous occasions.
      On 26th May, Mr. Speaker ruled that the Bill was prima facie hybrid because of a point of doubt whether the mobile offshore drilling rig, the "Key Victoria", was a ship for the purposes of the Bill and whether Marathon Shipbuilding (UK) Ltd. was wrongly excluded from Part I of the Bill. Amendments Nos. 3 and 4 are designed to put the point beyond doubt by defining "ship" in such a way as to exclude without question mobile rigs such as the "Key Victoria".
      266
      Paragraph 2 of Part II of Schedule 2 defines a shipbuilding company. One part of that definition is that it had, on 31st July 1974, an interest in possession in a shipyard which on that date was being used for the construction of ships. By excluding the "Key Victoria" from the definition of "ship" in paragraph 6 of Part II, these amendments define the class of shipbuilding companies in a way that excludes companies making only mobile offshore drilling rigs at that date. The amendment is precise, though general in effect. It removes the point of doubt which Mr. Speaker ruled existed.
      It is not for me to enter again into the question whether the Bill was hybrid. The House has determined that, however that may be, it is to proceed as a Public Bill. These amendments, which, during the debate on 27th May, we promised we would table, clarify this point, confirm that the Bill deals with genuine classes of companies as defined in the schedule, and will allow the House, and in due course another place, to consider the Bill on its merits and on the crucial issues with which it seeks to deal.
      Amendments Nos. 1 and 3 also deal with other technical points of definition. Amendment No. 1 aims simply to exclude remote and minute doubts that those who may seek to delay the Bill further might raise on the definition of "aircraft" and companies making them.
      In the normal course of events perhaps it would not be necessary to move these amendments. But if doubts can exist whether the "Key Victoria" is a ship then people may think that hovercrafts are aircraft, ships or a hybrid of the two, or that lighter-than-air aircraft such as hot air balloons are aircraft, or that model aircraft should qualify. For instance, my clear and categorical legal advice is that a hovercraft is not an aircraft or a ship. But the point has been raised, in the course of an exhaustive re-examination of the Bill for points of possible hybridity, and rather than risk further damaging delay, we propose to lay it to rest now.
      Removing the word "converting" in Amendment No. 2 is another example. It is not beyond the bounds of possibility that, having told us that Marathon produced ships, some hon. Members will perhaps claim that Marathon is in the business of ship repairing. I can assure hon. Members, if they need assurance on

      267
      such a point, that this is not so. For instance, there is no question of Marathon meeting the criteria in Subsection (3)(1)(b) of Schedule 2. However, during 1974, it did undertake a conversion, a one-off job, taken on solely to avoid redundancies. As the removal of the word "converting" does not affect the repairers named in the schedule we felt it only charitable to make this amendment and to remove any possible confusion that hon. Members opposite might have about Marathon being a ship repairing company.
      These amendments seek to establish the position not just beyond reasonable doubt but beyond all doubt—without being all-seeing and all-knowing, which we are not. But we have done our best to cover even the most far-fetched eventualities. I apologise to hon. Members who may feel that I have taken too much time in stating the obvious. We have, at least, tried to learn from the fact that similar points have lost us a lot of time in the past and we want to avoid the danger of any such delays in the future.
      Mr. Michael Heseltine: The Secretary of State is undoubtedly correct in suggesting that he has done his best in redrafting the hybridity provisions of this legislation. I do not think that any hon. Member has any doubts that the underlying issues that we are discussing today arise from the deal that was done in 1973, which, in spirit, if not in practice, inevitably made this a hybrid Bill.
      I do not know whether the amendments that the Secretary of State has moved have succeeded in making the position as clear as he would want. That is not the purpose of the speech that I want to make. Doubtless we shall consider that with care, and doubtless it will be considered with care in another place. The important question is why the Secretary of State is moving these amendments at all. That is the point to which I wish to devote my remarks.
      The fact is that in 1973, as the House knows, the Marathon Company of America was considering whether or not to invest on the Clyde, with the obviously desirable consequence that jobs would be saved and an ongoing business created. The major obstacle to its coming was the fact that the shipbuilding industry was threatened with nationalisation. The com-
      268
      pany knew that, not because the Government of the day intended to nationalise the shipbuilding industry but because the Labour Party, in its traditional and irresponsible posture in Opposition, was making threats not only about the shipbuilding industry but in respect of a whole range of other industries within the British economy. That is precisely what parts of the Labour movement are now doing, in and out of government. It is a well-worn phenomenon in terms of the debilitation of British industry.
      4.15 p.m.
      It is perfectly understandable that the American company asked for assurances that in the event of its coming to Britain its enterprise and initiative would not consequentially lead to nationalisation. It was easy for the then Conservative Government to give the assurance that there would be no nationalisation, but the Labour Party in Opposition, faced with a simple choice whether or not they were overtly prepared to put their own party dogma above the interests of the workers on Clydeside, gave the same assurance. They would have given that assurance whether Marathon had been the producer of rigs or of any other form of vessel, or of ships, because, at that time, it was quite unacceptable, in popular terms, to argue that the threat of nationalisation would be a deterrent to the maintenance of jobs on Clydeside. A very firm commitment was given.
      From the moment that commitment was given, in spirit this was going to be a hybrid Bill. There was no way round that position. The draftsmen in the Department of Industry were given the clearest instructions, when they had to draft the legislation, that Marathon should be excluded. In other words, a very precise instruction was given to leave out a company which otherwise, in the normal way of business, might easily have been included. It was, intentionally, a hybrid situation. It would have been perfectly easy for the Secretary of State for Industry, if this issue had been put to him at Second Reading, to have given exactly the same assurance as he is now giving to the House. He would have said "We have done our best to ensure that this is not a hybrid Bill. We have drafted legislation to put beyond all reasonable doubt that this Bill, as we understand it, is now non-hybrid."

      269
      That was the situation. But, of course, the Government got it all wrong. This is the upshot of what we now all too clearly understand. As a consequence of the diligence of my hop. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) and, frankly, the carelessness of ministerial instructions, the Bill turned out to be a hybrid Bill. The first reaction was to pretend that this was not the case, but Mr. Speaker's ruling was that it was prima facie a hybrid Bill. [An HON. MEMBER: "Yes, prima facie."] If the hon. Member wishes to rest on the words "prima facie", I would not dispute that. I merely make a factual observation that following Mr. Speaker's ruling that it was, prima facie, a hybrid Bill, there was no longer any possibility of the Government moving forward in any way without either redrafting the legislation or suspending the Standing Orders of the House of Commons. They did both, because they believed that the dogma of nationalisation was more important than either the rights of the individuals concerned or the rights of the House of Commons. That was the decision they took a couple of months ago. Then having taken that decision, the one point that I wish to place beyond peradventure is that the Bill remains a hybrid Bill. In intention it is hybrid.
      A party political deal, for party political reasons, was done to give special privileges to Marathon. It was done by the Labour Party in opposition and it is the intention of the Labour Government to honour that special deal between an American multinational company and the Government. That is what this debate is all about. The argument that the Secretary of State is putting to us is that, notwithstanding the fact that this was, prima facie, a hybrid Bill, and is still, it should nevertheless proceed along the traditional constitutional course.
      In order to ensure that the issue is not raised again amendments are necessary, not to cope with the problems in this House, because they have already been coped with by suspending the Standing Orders but because the Secretary of State fears that when the Bill reaches another place the issues of hybridity will be governed not by the Standing Orders of this House but by the Standing Orders of another place, and it will be perfectly within its right
      270
      to decide whether or not it should treat the Bill as hybrid. It is necessary, not in any way to put right omissions in this House but to anticipate the dangers that may still face the legislation in another place. That is why the Secretary of State is moving these amendments today.
      We resist these amendments, and I would not wish there to be any lingering doubt about why we do so. We think that it would be to the positive advantage of all concerned that the Select Committee procedure should come into play, so as to give people with a major interest in the legislation the opportunity to have their case heard. I think that this House would generally pursue its debates better, particularly its industrial policy debates, if there were much greater scrutiny of the Government than is possible at the moment.
      On looking into the motor industry a Select Committee provided the House with a significant constitutional advance. It is no longer possible, faced with the questioning of a Select Committee, for Ministers to run to cover or to provide half-answers and evasive generalisations. They are pinned down, and can be kept pinned down for hour after hour, until the facts have emerged.
      But under the procedures for examining public Bills of this sort, no such possibility exists. Certainly on Second Reading or in Standing Committee—as anyone knows who has read the proceedings on this Bill or any other—Ministers, in the end, can simply remain seated and rely on the votes behind them. They cannot do that under the Select Committee procedure. Consequently, the facts emerge, the debate is real, the judgments are informed. That is why, not only on this legislation—although this is a classic example of the improvements which can be obtained—we should serve the interests of this country much better if there were a Select Committee procedure.
      I do not intend to pursue at great length the sort of argument that might emerge from a Select Committee inquiry, but I am at a loss to understand why, for example, Bristol Channel Ship Repairers should be denied for months, despite repeated requests, even an interview with Ministers at which it could put its

      271
      case. Under a Select Committee procedure, that right would be available to it.
      Why Bristol Channel Ship Repairers should be denied that right when Marathon is given special privileges under the Bill, I am totally at a loss to understand.
      The Minister of State, Department of Industry (Mr. Gerald Kaufman): The hon. Gentleman may care to know that this morning, within an hour of a request reaching me, I saw Mr. John Sorotos of C. H. Bailey and, once again, put to him my very strong wish to go to Cardiff, to Bristol Channel Ship Repairers, to meet the work force and to discuss with it the Government's proposal for the company. Mr. Sorotos did not accede to my request.
      Hon. Members: Oh!
      Mr. Heseltine: It is fascinating that what the Minister of State has said should produce that Pavlovian reaction from Labour Members. What he has said has confirmed totally what I said to the Committee—that, for months, BCSR asked for an interview so that its case could be heard, and it was refused. Now, today, the Minister suggests that a meeting should take place.
      Mr. Ron Thomas rose—
      Mr. Heseltine: I should be grateful for the opportunity to finish the argument. I shall be happy to give way to Red Ron when the time comes.
      The House must ask why it is that today a phone call should go from the Minister of State to BCSR. The reason that month after month after month went by without such a response is that the Minister of State is trying to bamboozle the Welsh National Members into behaving in the way in which he succeeded in conning them into behaving a short time ago—
      Mr. Kaufman rose—
      Mr. Heseltine: I shall give way in a moment; the Minister must be more patient.
      We all know what the Minister of State has been doing; he has been moving from group to group on the Opposition Benches, telling one story to one of them
      272
      and another story to another, in the hope that he can salvage the Government's vote in each succeeding Division.
      The Scottish National Party Members, who have now seen the wisdom of their ways, were persuaded by some subterfuge from the Government Dispatch Box to abstain a couple of weeks ago. We knew that it was a trick, and they have now come around to understanding—
      Mr. Kaufman rose—
      Mr. Ron Thomas rose—
      Mr. Doug Hoyle rose—
      Mr. Heseltine: I realise that this is a Committee stage, but three Members at one time is a little excessive. I have promised that I shall give way to the Minister of State.
      That is the reason why Bristol Channel Ship Repairers has become significant. Like Marathon, it has suddenly become important to the Labour Party, so suddenly the red carpet—what an appropriate colour—is wheeled out—
      Mr. Bob Cryer rose—
      Mr. Ron Thomas rose—
      Mr. Hoyle rose—
      Mr. Kaufman rose—
      Mr. R. C. Mitchell rose—
      Mr. Heseltine: Now there are five of them. I shall give way to the Minister of State.
      Mr. Kaufman: The hon. Gentleman refers to the Welsh Nationals. I do not know what the Welsh is for
      timeo Danaos et dona ferentes—
      I shall leave it for them to work out—but the hon. Member should listen when statements are made. I did not say that I telephoned BCSR; I said that Mr. Sorotos telephoned me. That is the first point. Secondly, it is well known that many months ago my noble Friend my predecessor as Minister of State saw BCSR. As hon. Members will know very well, I have been trying for about four weeks now to get agreement from BCSR for a visit to its yards on the same basis as I am visiting Vosper Thornycroft on Friday.
      Mr. Heseltine: The Minister of State knows that that in no way deals with the issue. BCSR has been treated totally differently from Marathon. So that we might agree on one thing, let us assume that there is a disagreement between the two sides of the House. Let us assume that there are areas in which facts should be ascertained and the voice of the company heard. The question is whether that should be done by a Select Committee which could listen to all the arguments, not of the Minister of State and myself—after all, it would be fair to predict that we might not agree on many of these issues—but of BCSR, which should have the opportunity to put its side of the story just as Marathon was given the right to put its side.
      Mr. Ron Thomas: The hon. Gentleman is clearly trying to paint a picture that is quite contrary to what happened in Committee. Apart from the fact that Bristol Channel Ship Repairers spent hundreds of thousands of pounds wining and dining hon. Members in this House, I recall that the representatives of the company were at every meeting of the Committee. Continually, Opposition Members went out to meet them and their point of view was put continually during those proceedings.
      Mr. Heseltine: I cannot speak for the amount of food and wine that was enjoyed by Labour Members through the hospitality of BCSR—that is entirely a matter for those hon. Members—but there is a fundamental difference, which is what hybridity is all about, between the voice of a company being represented in Standing Committee by one Member of Parliament—
      Mr. Ron Thomas: By all the Opposition Members.
      Mr. Heseltine:—or by a team of Members of Parliament, and that company itself having direct access, so that the whole story can be put fairly and questioned in public. That is what Marathon effectively achieved by the undertaking given by the Labour Party in opposition.
      Mr. Michael Grylls: Is my hon. Friend aware that my information is that, although the Minister of State has said that he will go down to Cardiff to give a speech, there is something that he has not said? He
      274
      has said that he will not go down to have meaningful consultations with the shop stewards and all those in that industry, and hear their points of view. He wants only to make a speech, to make party points, to tell them why the Government are going to nationalise the company, and not to listen to the points that they want to put to him.
      Mr. Heseltine: The Minister of State should be able to help here. All we need from him is an undertaking that if the representatives of the company come to London at an appointed hour he will meet them. That is all he has to do. It is a simple undertaking; it is precisely what the company has been asking for. Why should exactly that not happen?
      Mr. Kaufman: The situation is this: I have now visited about 20 aircraft factories, shipyards and ship repair yards. All the approaches that my office has made for such visits have been on the basis that I would hold meetings with management, middle management, and workers' representatives, in order to discuss with them the Government's proposals in the Bill. I say "discuss", which means not making a speech but engaging in meaningful discussions. I have had about 20 visits of that kind in which meaningful discussions have taken place, in such companies as Austin & Pickersgill, Swan Hunter and Western Shiprepairers. I am going to Vosper Thorneycroft as well. This is in addition to a number of aircraft companies.
      Every company that I have approached has, without any precondition, agreed that I should make my visit on the basis that I proposed. I have proposed and have been proposing it for four weeks to Bristol Channel Ship Repairers, but it has not accepted. That company laid down preconditions for my visit which no other company laid down.
      4.30 p.m.
      Mr. Heseltine: The Minister of State wishes to go on repeating something that is quite meaningless. We know that on these visits the hon. Gentleman has made speeches. Many of my hon. Friends were present when he made his visits. I have spoken to many people. The Minister merely seeks the opportunity of putting forward the Government's determination to bring about nationalisation.
      Mr. Bruce Grocott: That is what he is paid for.
      Mr. Heseltine: Exactly. That is what he is paid for. The hon. Gentleman did not make those visits to discuss, negotiate or investigate in the way that the Labour Party went to Marathon to consider the facts. The hon. Gentleman said "I will tell you what the Government have decided to do."
      I have a copy of a letter that Labour Members will see as setting the scene in context of how Bristol Channel Ship Repairers replied to the Minister of State's observations. The letter, which is dated 19th July, reads:
      "On 13th January 1976 you"
      the Minister of State—
      "told Standing Committee D that you had made arrangements to visit us. However, seven months passed before we heard from you".
      That does not sound like a man who is totally confident that he will get the kind of reception that he wants or who cares whether he has any consultation. I ask the House to consider whether the juxtaposition of events is more in line with the interpretation that I have produced, namely, that the Minister is trying to buy off the Welsh nationalist votes for Thursday night, just as he did a few weeks ago. That is what the argument is about. The Government, exactly as they did with Marathon, will give in only when the pressure on them is overwhelming. Otherwise, it is their own dogma above all else.
      Mr. Dafydd Wigley: Is the hon. Gentleman aware that the only condition that Bristol Channel Ship Repairers put on any visit was that there should be an agreed agenda? It was on the basis of an agreed agenda that the arrangements fell down. Perhaps the hon. Gentleman will ask the Minister what formal letters were sent asking for a meeting with Bristol Channel Ship Repairers and the dates of those letters, if any were sent.
      Mr. Heseltine: I am delighted to welcome the Welsh nationalists back to the fold in opposition to the Bill. There is no point in asking the Minister of State such questions, because we shall not get answers. There is no way in which the House can get answers from Minis-
      276
      ters in this Government. That is why there should be a Select Committee procedure. The Minister would then have no choice but to produce the evidence—the letters and documents and, indeed, the draft agenda that Bristol Channel Ship Repairers sent to him as a basis for discussion. That would make the position clear. That would then put the treatment of Bristol Channel Ship Repairers precisely on all fours with the treatment that Marathon received from the Labour Party when in opportunist opposition.
      Mr. Richard Wainwright: On the question of the visit to Bristol Channel Ship Repairers, does the hon. Gentleman agree that it is typical of the arrogant mood into which the Government have moved, as they have found themselves thwarted, that the Minister should lay down to a company, which is really a collection of many small ship repair depots, the same type of straitjacket procedure for visits as he has apparently got away with in relation to huge shipyards on the North-East Coast, when the two are not analagous?
      Mr. Heseltine: The hon. Member for Colne Valley (Mr. Wainwright) makes an important point, with which I agree, but it is bad news for the Government that the Scottish and Welsh nationalists, the Liberals and the Conservatives are opposed to the Bill. All we want now is for the Ulster Unionists to rise to their feet in hostility to the Bill and the Minister of State will be offering all kinds of deals to try to buy his way back into power on Thursday night. With this kind of pressure, who knows what concessions will be offered? The more that the voice of opposition is raised from the Opposition Benches, the more the Minister will have to review his position. [Interruption.] If the hon. Gentleman wants to start singing that song, he should join his colleagues below the Gangway, because we know what is in their minds.
      Mr. Gordon Wilson: As the hon. Gentleman has mentioned so many names and taken them in vain, and as the Minister of State has moved from Bench to Bench, will he tell us what blandishments were offered to the Conservative Party to resume pairing arrangements several weeks ago, and what subsequently caused that arrangement to be changed and to revert to square one?
      Mr. Heseltine: The Minister of State knows that there is no way in which he can buy off the Conservative Party. It is the one party that has consistently fought the Government from the day that they were first elected.
      I leave that point, I realise that it is uncomfortable for Government supporters. The fact is that many of my hon. Friends wish to speak in this debate and I wish to give them an opportunity to do so. I leave that matter, merely saying that I can see no justification for treating Bristol Channel Ship Repairers, Vospers, Vickers, Yarrows, or even the aircraft companies, in any way differently from the privileged negotiations that the Labour Party, in opposition, was prepared to conduct and to make arbitrary arrangements for narrow party purposes. That is the only point that the Government have to answer.
      The Government will not accept the concept of a Select Committee investigation into one of their Bills, because questions would have to be answered. All who served on this Bill in Committee and those who have served on other committees are fully aware that this proposal to nationalise two industries is based on dogma. There is not one rational argument behind the Government's proposal. Every time that Members who served on the Committee or any commentators in the wider media outside asked for information, facts and forward plans, there was a deafening silence. The Government are appalled at the prospect that someone might demand answers to questions before progress is made on the Bill. For example, which yards will be run down under nationalisation?
      Mr. Grocott: There were 58 sittings in Committee.
      Mr. Heseltine: The hon. Gentleman makes a valid point. There were 58 sittings. I wish that there had been more. However, we still did not get the answers, and we would not have got them had there been 158 sittings. That is the difference between the Standing Committee and the Select Committee procedures.
      We have not found out which yards are scheduled to be run down in the Government's proposals, although the steering committee must know. We have no idea which projects will be intro-
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      duced or where the work will come from under nationalisation, although somebody in the Department of Industry must have a fairly shrewd idea of what the score is likely to be. We have no idea how much direction of orders will take place from the successful to the unsuccessful yards, although somebody must have made the calculations.
      In the aircraft industry, we have no idea where the work load and the projects for the next five years will come from, yet that is the only question that matters when dealing with job prospects and investment in those industries.
      All those questions would have been answered compulsorily under the Select Committee procedure. If they were answered, the Government Benches would be filled with apprehensive Members of Parliament, because they would have to care about the answers. But, because they can go on mouthing platitudes, such as "We will look after the jobs, boys, once we have these industries in public ownership", without coming to grips with the economic crisis which is facing us—a trauma that will intensify within the next few months—they are able to hide behind the generalities without facing the practical realities.
      The Bill is an alibi to try to persuade people that we can go on behaving in a way in which everyone increasingly understands we cannot. The Government have enabled unpalatable questions to be delayed a little longer. Labour Members are content to see £300 million of the taxpayers' money pushed down that drain because it suits the convenience of the Government at this time.
      We shall oppose this group of amendments. We shall oppose them deliberately, in order to keep this a hybrid Bill, because if it remains a hybrid Bill it is possible that some questions will be answered and that the truth will come out, and if that happens the Bill will have even less chance of reaching the statute book.
      Mr. William Small: Having served on the Standing Committee, perhaps I may make a short contribution on the subject of hybridity.
      If one does research into hybridity in history, one finds that the first case known to man was that of Heiron II, who examined his crown, and sent it to the goldsmith, who said "We had better give

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      this job to Archimedes." Archimedes then discovered the degree of gold and silver by weighing the crown in water. Then we heard "Eureka, Eureka"—the great discovery from the hon. Member for Tiverton (Mr. Maxwell-Hyslop), who suddenly met a man from Yarrows. The man's name is Ian Dewar Mann. We sat for 58 sittings without a whisper of hybridity, but suddenly a director of Yarrows does not want it to be included in the Bill. It was in the schedule and Marathon was not. Therefore, on a technicality, a political apostrophe, we went through the drama of that evening when the hon. Member for Henley (Mr. Heseltine) lifted the Mace.
      For those biblically inclined, if they look at the Revised Version of the Holy Bible, of 1611, they will find that they have been living with a mistake all their lives. They have talked of straining at a gnat, and swallowing a camel, but in the free Greek translation a mistake was made. The phrase is not "straining at a gnat." It is "straining out a gnat." In the Mediterranean basin, in straining olives to get rid of insects people use a net which strains out the oil. It would strain out gnats and not strain at a gnat. We have lived with that mistake all our lives. I can live with many mistakes here.
      Mr. Teddy Taylor: I am sure that SNP Members were very appreciative of the fact that they were mentioned in the King James' Bible. Straining at the gnat is something that the Minister has been doing ever since we have been discussing these affairs. I am sure that SNP Members will agree that it is desperately important that we get the right decision in relation to Scotland, with its tragic unemployment.
      My hon. Friend the Member for Henley (Mr. Heseltine) has rightly said that we are here making a simple decision whether the Bill should go through to the House of Lords now or whether it should be considered in detail—
      4.45 p.m.
      Mr. Roger Stott: On a point of order, Mr. Murton. Perhaps you would guide the House whether it is in order for an hon. Member who has a pecuniary interest in the matter that we are discussing not to declare that
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      interest when he starts to speak. The hon. Member for Glasgow, Cathcart (Mr. Taylor) is entered in the Register of Members' Interests as having an office of employment in the Shipbuilders and Repairers National Association. Ought not the hon. Member to have informed the House of that fact when he rose to speak in this debate?
      The Chairman: It is customary and a courtesy to the Committee for hon. Members to do that if they have an interest.
      Mr. Taylor: As the hon. Member for Westhoughton (Mr. Scott) is well aware, I have made it clear from the beginning of our proceedings in Committee and have declared it in the Register that I am a parliamentary adviser to the Shipbuilders and Repairers National Association, and I spent most of my working life in the shipyards of the Clyde. However, the Minister of State has taken every opportunity not only to advise hon. Members of this but also to put the most grave misinterpretation on my relationship with the association. As adviser to the association it is an honourable job that I do. It is very strange that it has been alleged that I have been in some way the spokesman for the industry in the House of Commons. It is very strange that we have had the hon. Member for Central Ayrshire (Mr. Lambie), the Minister and others saying that the industry is desperate to be nationalised and that the employers are just dying to be nationalised because they will crumble unless they are nationalised.
      Mr. David Lambie: And you will lose your job.
      Mr. Taylor: If I were acting as a spokesman, according to the Minister I would be supporting this Bill. However, I wonder whether it is being suggested by the hon. Gentleman that if I were not a parliamentary adviser to the association I would be supporting the Bill.
      I have deplored this Bill from the moment it started because I believe that it will mean a very considerable loss of jobs in Scotland. All the evidence is there. It would be considered if we defeated these amendments and allowed the Bill to be considered in detail.
      Mr. Heseltine: On a point of order, Mr. Murton. The Register of Members'

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      Interests was deliberately prepared in order that there should be clarity about the interests of hon. Members. My hon. Friend the Member for Glasgow, Cathcart (Mr. Taylor) has repeatedly declared the interest concerned. I believe that it would be against the best interests of the House if the Parliamentary Private Secretary to the Secretary of State sought to raise this issue not because he is seeking clarification but in order that a party point should be put across the House, by the form of a technique of repetition which I am not aware of having heard from the many Labour Members who are paid by trade unions in order to put their particular points of view.
      The Chairman: The Committee is well seized of the point, and I think that it should not be pursued.
      Mr. Taylor: It is very important from Scotland's point of view that there should be a very careful look at what nationalisation will do to jobs in Scotland, for a number of reasons. First, we have had many recent experiences of the effect of nationalisation on jobs in Scotland. One of the reasons why we shall be denied the presence of the hon. Member for Central Ayrshire and many of his hon. Friends after the next General Election, and one reason why he will find great difficulty in saving his deposit, is the effect of nationalisation on jobs in Central Ayrshire. Only this week we had yet another indication that the salvation of jobs in Central Ayrshire and the vicinity—the building of the integrated steelworks at Hunterston—will almost certainly be delayed simply because a nationalised board does not have the money to go ahead. We have our experience of the nationalised steel industry in Scotland, which has meant not only redundancies but reorganisations and people being put out of work and moved from one place to another.
      The nationalisation of steel has been misunderstood as being the salvation and security of jobs in Scotland, but it has been a disaster for Scotland. We have the appalling situation that the pipes for North Sea oil, instead of being produced by our State-owned industry, are being imported from Japan. For one reason only, the effect of steel nationalisation on jobs in Ayrshire and Lanarkshire, we should reject these amendments and
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      ensure that the case for shipbuilding must be made in detail.
      Secondly, on the question of the oil industry, it would take a genius to make a financial disaster out of North Sea oil, but that is precisely what the Government have done because of their threats of nationalisation of the oil industry in the North Sea. The House will be aware of the tragic situation in Scotland where the Government have pumped a massive amount of money into oil platform yards and we have these yards at present with nothing to do—men being put out of work, men not being employed, men threatened with redundancy. Why is this so? It is simply because of Socialist planning and nationalisation.
      Mr. Loyden: Nonsense.
      Mr. Taylor: The hon. Gentleman will accept that North Sea oil is a potential boon. However, the Government estimated that once we got North Sea oil going we would have plenty of orders for platforms and, therefore, plenty of jobs for Scots. It has not happened. Why not? The oil industry has made clear time and again that one of the main reasons why development has slowed is simply the threat of nationalisation and State participation in oil.
      In Scotland 165,000 people are unemployed and there will be more. Nationalisation is one of the main reasons for that. Hon. Members may say that that is not the case, but I ask them why it is that there are no oil platform orders, why have steel workers been put out of work and why has the Hunterston plan been delayed? The reason is that Government and industry cannot work together and that Governments always have a horrible habit of running out of money in a way that private industry does not. That is one of the main reasons for the jobs crisis in Scotland.
      Mr. Eric S. Heffer: Will the hon. Gentleman explain, if private industry does not run out of money, what happened to Leyland, Rolls-Royce, Alfred Herbert, Norton Villiers and the long list of companies that used almost to sit on my doorstep begging for money when I was Minister? They encountered trouble at the beginning of the period of Labour Goverment and at the end of the Tory Administration.
      Mr. Taylor: A number of firms in the private sector do not succeed and run out of money because they stop making profits and have labour problems. If Governments did not prop them up, they would have to be reorganised or closed down. But where there is a potential for profit and growth, private industry can obtain the cash whereas governments cannot. The Hunterston steelworks and oil development are examples of that.
      Mr. Heseltine: The firms on the list provided by the hon. Member for Liverpool, Walton (Mr. Heffer) had one thing in common. They had listened to the right hon. Member for Bristol, South-East (Mr. Benn) who had given them advice on how to make their companies successful. Consequently, they went bankrupt.
      Mr. Taylor: I was putting forward the facts upon which I hope that hon. Members opposite will reflect. In Scotland our experience is that nationalisation makes things worse.
      The third reason for rejecting the amendments and for a study on the effects of nationalisation is that nationalisation means centralised decision making. Decisions will be made not in Scotland but elsewhere. When we see the ludicrous proposals for decentralisation we should not be surprised if the hon. Member for Greenock and Port Glasgow (Dr. Mabon) had a finger in it.
      With the help of the late Mr. Brian O'Malley, on the iron and steel nationalisation Bill, we managed to get through an amendment to provide that regard should be paid to the regions when the headquarters of the steel board was located. That was a victory because it should have meant that there would be no London set-up. Despite what the Minister may think—and I am prepared to accept that he is a decent and straight chap—there will be a colossus in London. He believes that the amendment will result in no such thing and he is expected to make an announcement about the siting of the headquarters this week. I am certain that the little branch office in London will grow and grow.
      When the Oil Corporation was set up in Glasgow we thought that that was a good thing. But there is nothing in Glasgow except a load of crockery and
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      one or two typists. All the action and meetings are in London. I am sure that the Minister will confirm that that is what has happened. There is nothing in Glasgow except rent being paid to a property company, a large number of cups and saucers and plates and one or two people who open doors and organise lunches.
      Another reason for rejecting the amendments is that we cannot afford nationalisation at present. We are cutting back on essential services. In my area home helps are being reduced by 5 per cent. and school crossing wardens are being cut, creating a threat to old people and children. We cannot afford those essential services if we spend all our money on nationalisation.
      The final reason for rejecting the amendments—and the pro-nationalisers such as the right hon. Member for Bristol, South-East (Mr. Benn) and others should bear this in mind—is the Healey cuts which have just been announced. One of the items is a reduction of £147 million for investment in the nationalised industries. We do not know where those cuts will fall. We do not know whether they will affect steel, the railways or British Airways. All we know is that, despite cuts which have already been made in investment in nationalised industries, there is to be a further cut of £147 million.
      Do hon. Members opposite believe that if the Bill goes ahead there will be enough cash for development? They must know that there will not be that cash because existing nationalised industries are already being starved of investment. British Rail and the steel board are being starved and shipbuilding will also be starved of investment. The industry will become more archaic and will make larger and larger losses which will have to be financed by the taxpayer. The Secretary of State knows that he will have to pay a fortune to the Treasury for those losses because he has not got the money. If he has, will it come out of the £147 million that he is to take out of the other nationalised industries?
      Let us take another look at the nationalisation proposals and justify them yard by yard. I am afraid that the Bill will create the same problems as

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      occurred in the steel industry in Scotland. Jobs will be lost instead of gained, profits will be lost instead of made. That will be bad for the consumer, bad for the taxpayer and will certainly be bad for Scotland.
      At a time when unemployment in Scotland is at a post-war high, and rising fast, the Secretary of State should look carefully at spending more money on nationalisation. Local government spending is being cut, there is a three-month delay in the payment of regional aid premiums. The Government are operating crazy economics and the proposals will be bad for jobs and for Scotland. I hope that the amendments will be rejected.
      5.0 p.m.
      Mr. Richard Wainwright: It is a notable and welcome occasion when the Conservative Party acknowledge, as they have done today, that the debating procedures in the Chamber and the adversarial procedures in the Chamber and in Standing Committee are wholly unsuited to the discussion of legislation dealing with nationalisation or denationalisation of the complicated entities such as we have in industry today. I regret that the Government—exceptionally in the case of the Secretary of State, who usually has a generous, large-minded attitude—seem to treat the necessity for the amendments as an irritating detail to placate some meticulous hon. Members on the Opposition side. That is a short-sighted attitude.
      It should be understood that any future ventures—and I hope that there will be few—into the State takeover of modern industry are bound to be hybrid in spirit and are almost certain to be hybrid in the letter. The Government are lucky to have picked two industries where they might get away with dismissing hybridity by the absurd formula which is before us.
      Everybody knows that industry today is so ramified that it is impossible, without abusing draftsmanship, to categorise industries in legislative form. At random, I did an exercise on the supposition that some misguided government might want to take over the concrete industry or the wire industry.
      Mr. Eddie Loyden: What a good idea.
      Mr. Wainwright: A glance at a trade directory shows that if that were to happen in the concrete industry it would be necessary to refer to at least 59 different categories. In regard to the wire industry it would be necessary at the very least to refer in detail to at least 106 different products in that industry.
      The Government are lucky if they get away with categorising the shipbuilding, ships repairing and aircraft industries in the formulae which have been devised. It would have been better to face the matter and to realise that matters of this highly technical nature should be dealt with by an inquisitorial and interrogative procedure such as that adopted in Select Committee. That would have been achieved if the Government had opted for the hybrid procedure—a procedure which undoubtedly haunts this Bill and which I hope will be fully explored in another place. They should have met that difficulty head on and gone back to a Select Committee. The Liberal Party has for many years made the point that the adversarial procedure in this House is outdated. Therefore, we shall oppose these amendments.
      Mr. R. C. Mitchell: Before the hon. Gentleman resumes his seat, may I ask him one question?
      The Chairman: The hon. Member for Colne Valley (Mr. Wainwright) has already concluded.
      I call Mr. Ron Thomas.
      Mr. Ron Thomas: I should like to ask the hon. Member for Colne Valley (Mr. Wainwright) about a matter that no doubt was in the mind of my hon. Friend the Member for Southampton, Itchen (Mr. Mitchell), who tried to intervene. I wish to make the point that during the 58 sittings of the Committee I did not once hear the hon. Member for Colne Valley say that he felt that we had not discussed the Bill in sufficient detail. He certainly did not suggest that we had not given enough time to any particular yard.
      Mr. Richard Wainwright: I was cavilling not at the amount of time taken, but at the use made of that time. I believe

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      that time spent in an inquisitorial question and answer procedure in a Select Committee would have been much more fruitful than the seeming eternity that we spent in Standing Committee.
      Mr. Thomas: If the hon. Gentleman has any comment about the wasting of time in Committee, he should address it to the hon. Member for Glasgow, Cathcart (Mr. Taylor), who gave a long detailed account of the development of jurisprudence in Scotland, going back before the days of William the Conqueror. If any hon. Member likes to read the Hansard of the Standing Committee and to undertake a statistical exercise, he will find that the bulk of the time spent in that Committee was taken up by Opposition Members arguing about the level of compensation to the owners. They tried to extract the last penny for the kind of people they represent.
      Mr. Heseltine: As the hon. Gentleman has now delivered himself, no doubt for constituency consumption, of that particular load of rubbish, will he tell us in the context of the 58 sittings of the Committee the proportion of time devoted to the subject of compensation?
      Mr. Thomas: I have not worked out the matter statistically. I was pointing out that one has only to read through the reports of the proceedings in the Standing Committee to realise that, having dealt with the duties and responsibilities of the corporations and with questions of industrial democracy and diversification, we went almost immediately to the subject of compensation.
      Mr. Kaufman: Does not my hon. Friend recollect that the hon. Member for Dundee, East (Mr. Wilson) at the final sitting of the Committee said that the filibustering began when we reached the compensation clauses and that progress then came to a grinding halt? The hon. Gentleman repeated that remark during the timetable debate only last week.
      Mr. Thomas: I agree that that was said by the hon. Member for Dundee, East (Mr. Wilson), and no doubt the hon. Gentleman will take up that matter if he has the opportunity to speak in this debate.
      I was concerned when, following the 58 sittings of the Standing Committee,
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      we were suddenly faced with the situation involving the prima facie situation of hybridity. It seems strange to many hon. Members that we could have got to that advanced stage in the Bill before anybody discovered the issue of hybridity when that point had not been raised throughout many detailed arguments.
      I see no justification for the argument that the Bristol Channel Ship Repairers or any other company has been unable to put its point of view on this legislation. That company, so far as I can judge, has spent hundreds of thousands of pounds on a massive publicity campaign involving the wining and dining of hon. Members. Furthermore, week after week its representatives were present in the Standing Committee and were constantly available to give advice to Opposition Members.
      One implication in the remarks of the hon. Member for Cathcart was that up to this point we had taken into public ownership only bankrupt industries. In other words, we took over only those industries which had already been exploited, industries which the so-called entrepreneurs were no longer willing to capitalise. Therefore, having taken them over, we have had to go through a system of rationalisation, sackings, redundancies and all the rest of it.
      If it is said that private industry is the only means of providing jobs, sales, markets and so on, why have we 1½million unemployed? It has happened because private industry has failed. One has only to look at the level of unemployment in other Western industrialised companies. They have fared no better than industry in the United Kingdom. One has only to take as an example the situation in West Germany—a nation held un by the Opposition as adopting the kind of policies we should be pursuing with our own trade unions. It also applies to the United States. It lies in a failure of the private enterprise system.
      Perhaps the hon. Member for Cathcart will give examples of what he regards as Socialist planning. I am waiting to go into the Division Lobby in order to register my "Yes" vote for a bit of Socialist planning.
      Mr. Teddy Taylor: I give just one example—namely, the situation in regard

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      to the supply of oil platforms. The Government are putting many millions of pounds into North Sea activities, but there are no platforms because the investment programmes of the oil companies are being held up by the Socialist threat of nationalisation.
      Mr. Thomas: I do not regard that as Socialist planning. Indeed, the situation would be no different under a Conservative Government.
      We have heard a good deal about the unemployment that might be created in the aircraft and shipbuilding industries. I shall not comment on shipbuilding because I do not know enough about that subject, but the Government have never even hinted that the mere act of nationalisation of the aircraft industry will save jobs nor do we expect that to happen. What the Government have rightly said—and we support them on this—is that for years now none of the private owners, none of the Lord Robenses who own Vickers and therefore ipso facto BAC, has been prepared to put his private money into any venture. The private owners are prepared to go ahead only if they can get my right hon. Friend to give them public money. That is the heart of the problem.
      We believe that public ownership will bring about the kind of co-ordination and planning that will give much better security to workers in the aircraft industry than they have ever had under the private system. The Conservatives' record shows a considerable rundown in numbers of employees in the aerospace industry under a Tory Government.
      I am sure that the House will support the Government's amendments and will reject the many Conservative amendments aimed basically at stopping public ownership of the aircraft and shipbuilding industries.
      Mr. Robin Maxwell-Hyslop: The Secretary of State left us rather in the dark. He told us that the reason for trying to eliminate hybridity is to speed the passage of this Bill. Clearly this is not the case. If the Secretary of State had wanted to speed the passage of the Bill, he would not have acted as he did on 27th May—more than six sitting weeks ago. He would have tabled a motion that the Bill be sent to a Joint Committee of the two Houses of Parliament, which is
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      an alternative to a Select Committee in both Houses. That would have cut out the Committee stage in the House of Lords. The Bill would have been on the statute book by now had he followed that course.
      Alternatively, the Secretary of State could have sent the Bill to a Select Committee. In six sitting weeks the Bill would have been out of the Select Committee and back on to the Floor of the House for Report stage, when there would have been no need for a guillotine. Whatever is passing through the mind of the Secretary of State—and it would seem that is not a very arduous process—it is not the speedy passage of this Bill.
      What then is the object of these amendments? The Secretary of State has not told us. The only reason he has given is transparently untrue, The real reason is of course, his dread of the petitioners. He is determined that ordinary working-class employees of the firms concerned, who belong to trade unions which sponsor Labour Members and who do not wish to be nationalised, must not be allowed to appear before a Committee and to give evidence or assert why they do not wish to have their livelihood jeopardised by the Bill. That is what the Secretary of State has avoided by the serpentine procedures which the Government have followed.
      5.15 p.m.
      Far from saving time, these procedures have consumed time, and they have delayed and hazarded the passage of the Bill. Is there a more sinister reason for this? It is possible that the Secretary of State wants some shipyards to collapse and to go out of business before the Bill reaches the statute book. Is that the reason for his delaying tactics? Does he want to ensure that the collapse of these yards will not be laid at the door of Lord Beeswax or Admiral Griffin? There may be other reasons, but if there are, they have not been given to the House.
      Why is the Secretary of State deliberately adopting procedures week after week which have slowed down the passage of the Bill? He does not seem to be very well harmonised—to use an EEC expression—with his Minister of State who rushes around the country saying that unless the Bill is passed into law rapidly, people's jobs will be at stake.

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      Yet the Secretary of State is doing all he can to delay the Bill. He and the Minister of State should have a conference before the Minister of State is allowed to visit any more firms. They should reach an agreement and decide whether they are trying to speed up the passage of the Bill or delay it.
      Mr. Loyden: Is the hon. Member aware that on Merseyside a massive amount of Government money has been poured into private enterprise shipbuilding and repairing yards? This has been happening for the last five years—long before there was any question of nationalisation. The situation in these yards has now reached the point where they are employing less than 3,000 people compared with 20,000 many years ago. If he is applauding private enterprise, perhaps he could explain why this situation has been reached.
      Mr. Maxwell-Hyslop: I do not see what bearing that intervention has on the point I was making that the Secretary of State is delaying the Bill while the Minister of State is asserting that its speedy passage is desirable.
      Mr. Tom King: Has my hon. Friend noticed that that strange intervention was critical of the management of the shipbuilding industry on Merseyside, yet the Government have appointed as the chief executive of the new shipbuilding corporation one of the managing directors from Merseyside?
      Mr. Maxwell-Hyslop: Yes, indeed. Doubtless he is drawing a salary for a job which is not being done. When we have the winding-up on this debate I hope that someone will speak with authority on behalf of the Government and say which of these two things—mutually incompatible as they are—they are trying to do. The House is entitled to know which of the two Ministers has been declaring Government policy, as it is not possible for both to be doing so. Indeed, the only interpretation we can place on their conflicting attitudes is the one with which I started—namely, that the Government want massive collapses inside the aircraft and shipbuilding industries before the Bill receives Royal Assent.
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      If that happens they can say, "Look, this is the result of not being nationalised." They have deprived these firms of adequate credit by threatening to nationalise them, they have driven away foreign customers who do not want to place orders without knowing who is going to execute them, then when the firms totter they say that this is the result of not being nationalised.
      Mr. John Evans: Is the hon. Member aware that shipyard workers in the North and North-East of England are very concerned about these matters, and if he is suggesting that shipyards will collapse if they are not nationalised, his party will bear the primary responsibility for that?
      Mr. Maxwell-Hyslop: It is not the Conservative Party which is driving customers away from the North, North-East, the South or anywhere else. What is driving them away is that they do not know whether the orders they place will be executed by the yard with which they are placed. They do not know which yards the Government will keep going or which yards they will close. They know perfectly well that the Government intend to create more unemployment by closing down shipbuilding and ship repair yards. The customers abroad know that perfectly well, but the Government, by refusing to say which they will close, are depriving those to be kept open of business which they could otherwise take. It is the Government, not the Conservative Party, who are doing that.
      Mr. Loyden: You delayed the Bill.
      Mr. Maxwell-Hyslop: If the hon. Gentleman had been here a few moments ago he would have heard how the Bill could aready have been on the statute book by now. The decision to do nothing week after week was taken by the Secretary of State, the Leader of the House, the Prime Minister and the rest of the Cabinet. The Opposition do not decide what shall be the Government Orders of the Day. It was not the Opposition who drafted the Bill so incompetently. It was not the Opposition who tried to circumvent Mr. Speaker's ruling. All that was the responsibility of

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      the Government. At each step the Government have taken decisions which are either foolish or incompetent or are both.
      It is not to be expected that their actions would be either consistent or successful because they cannot agree among themselves what they are trying to do. If the Secretary of State is trying to delay the Bill while the Minister of State is trying to hustle it, it is not surprising that nothing happens. That is why week after week has gone by with nothing happening. If Labour Members had been in touch with trade unionists in the industry, they would have known of the extreme anxiety of these people at the Government refusing to declare which projects they will back. There is nothing to stop the Government from doing that. Their decision to back projects is in no way dependent on whether the industry is nationalised. They have the power to back projects under existing legislation, and they do not need one word of this Bill to enable them to back projects to enable the aircraft industry to survive, and without which it will not survive.
      Certainly, unscrupulous Socialist politicians from both the Treasury Bench and the Back Benches have been rushing around the country deliberately deceiving the workers in those industries. They have told them that unless the Bill is passed their jobs are in danger. There is no word of truth in that. They have also told them that if the Bill is passed, their jobs will be safe. There is no truth in that either. They have told them that the projects in the aircraft industry upon which their livelihoods depend cannot be undertaken unless the Bill is passed. There is no truth in that whatever.
      All this is a grossly immoral thing to do to people whom the Government intend to throw on the scrap heap, and they intend to do that to a large number of people who are currently employed in these industries. Back Benchers know that that is the Government's intention, and they are participating in the deceit by concealing the fact from their constituents, from their fellow trade unionists, and from the firms which fall within the ambit of the Bill. Let us therefore have no more humbug about that. The Government intend to create still more unemployment.
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      We have not seen the worst of the unemployment. Last week there was the announcement of the payroll tax. The Government intend to close shipbuilding firms. Why will the Secretary of State not say which he intends to shut down? The reason is that it would lose some votes. Once people know which firms will be shut, the Members who represent them will have a very rough ride. The Secretary of State will not tell the employees, the managers or even the directors in the aircraft industry which projects the Government will back.
      Mr. Ian Lloyd: My hon. Friend has touched on a most important point about the reduction in capacity which is bound to follow enactment of the Bill. Is he aware that the EEC Commission has published a report in which it makes clear that the first requirement of Community action is that the Community must undertake to bear its share in the reduction of capacities in order to establish equilibrium between supply and demand in shipbuilding?
      Mr. Maxwell-Hyslop: I am grateful to my hon. Friend. One wonders whether the Secretary of State, who is not very good at reading, has read that. I say that he is not very good at reading because neither he nor his officials gave any sign that they had read the Select Committee Report on the motor industry. Instead, they allowed the waves of the Chrysler episode to break over them. It is therefore possible that the right hon. Gentleman has not bothered to read the EEC document either, and that also may take him by surprise.
      Mr. Varley: I take very little notice of anything to which the hon. Gentleman has contributed.
      Mr. Maxwell-Hyslop: Yes, and it is the taxpayer who has to pick up the bill. The right hon. Gentleman came down to the House to ask for large subventions of taxpayers' money because he had not done his job as Secretary of State as he was paid to do it. He was in charge of an incompetently drafted Bill, and he knows so little of procedure that he has allowed weeks to pass without the Bill making any progress. On the one hand, the Minister of State was rushing around the country saying that the Bill was desperately needed, while, on the other

      295
      hand, the Secretary of State was holding it up. The right hon. Gentleman cannot have it both ways. His incompetence is self-confessed as well as obvious.
      Perhaps at some stage the Secretary of State will come clean with the Committee. He must tell us today whether he wants the Bill passed quickly into law. If Government policy has been reversed and if the Minister of State now holds sway, we are entitled to be informed of that fact. It might be as well to make sure that the other place knows what Government policy is, because their Lordships might be entitled to infer that the Government want the Bill delayed as much as possible, since the right hon. Gentleman has taken every step within his power to delay it.
      We now come to the amendments with which the right hon. Gentleman is endeavouring to remove hybridity from the Bill. He must have our sympathy. It must have been very embarrassing for the Secretary of State, if he is capable of being embarrassed, when on 27th May, the very day of the cheated vote, out came the Financial Times with an article on Marathon saying that the company was now going into business making what even the Secretary of State would recognise as ships. That must have been very embarrassing for him. The truth of the matter is that if Marathon is not to collapse, it cannot remain in business making only vessels like "Key Victoria". It will have to make things that even the Secretary of State would recognise as ships. Why, then, all these convolutions to leave Marathon out of the Bill? If nationalisation is a healthy process for the whole industry, why is it not healthy for Marathon? If it is a necessary process for the shipbuilding industry, why is it an unnecessary process for Marathon? If it is in the national interests, for no very obvious reason, that all firms that are converting, constructing or repairing ships above a certain size should be nationalised, why is it not in the national interest that Marathon should be nationalised?
      How did Marathon come here in the first place? As a matter of interest, it came here largely through the intervention of Mr. McGarvey—excellent—and the owner of Bristol Channel Ship Repairers Limited, who went to America
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      at his own expense and stayed there for several weeks to assist in the negotiations, for which he has never received a penny. Indeed, he did not expect to receive anything from the beginning.
      5.30 p.m.
      How do the Government explain this inconsistency? They promise not to nationalise Marathon and proceed to try to nationalise Bristol Channel Ship Repairers Limited against the overwhelming wishes of its own employees. That is Socialism in action.
      If the Bill goes through and we look back in three or four years time at what is left of the aircraft and shipbuilding industries, how many will recognise what is left as the pattern that Labour Members told their constituents would follow the passage of this miserable Bill, whether or not it is dehybridised?
      Mr. Hoyle: I shall speak quite differently from the hon. Member for Tiverton (Mr. Maxwell-Hyslop)—namely, about the people who work in these ton must take the credit—he cannot interest in that I am a member of the National Executive of ASTMS. Its members in the shipbuilding and ship repairing industries, and in the aircraft industry, desire the Bill as soon as possible.
      Of course, the hon. Member for Tiverton must take the credit—he cannot move it anywhere else—for holding up the Bill. That is his responsibility. Why does he now try to hide away from it? Why is he trying to put the responsibility on the shoulders of my right hon. and hon. Friends? I thought he was proud of what he had done. After all, he does not need to be troubled by angry constituents in the aircraft and shipbuilding industries in Tiverton. There are not too many shipyards knocking about in Tiverton. The hon. Gentleman is in no danger. Why does he not admit that he delayed the Bill and take the responsibility for doing so?
      There are many angry people in the aircraft and shipbuilding industries. They are demanding to know what the Opposition are playing at. After 58 sittings in Committee they continued to delay the Bill. My hon. Friend the Member for Bristol, North-West (Mr. Thomas) referred to the compensation clauses and said that the Opposition were interested only in those clauses. He is usually 100 per

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      cent. correct, but in this case he was not quite correct because much of the time was taken up by discussion on the arbitration clauses, in which the Opposition also have a vital interest. Examination of the proceedings in Committee will reveal the inordinate amount of time that was taken up by references to arbitration. Compensation and arbitration were their main interests.
      Mr. Norman Tebbit: I think that the hon. Gentleman is being a little unfair to his colleagues in giving all the praise to my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) for delaying the Bill. If the hon. Gentleman examines the record he will find that the Bill was given a First Reading on 30th April 1975, but it did not receive a Second Reading until 2nd December—namely, a seven-month delay. Whatever my hon. Friend has done, he has not delayed it that much yet.
      Mr. Hoyle: I am pleased that the hon. Member for Chingford (Mr. Tebbit), in his usual way—he is often partly truthful with the House—admits that the hon. Member for Tiverton is responsible for some of the delay that has occurred.
      Mr. Tebbit: Not for seven months.
      Mr. Hoyle: It might not be seven months, but he is turning it into a pregnancy in the way that he is going about it. The point that I am making is that the people in the industries want to get on with the successful running of them.
      I am pleased that the hon. Member for Glasgow, Cathcart (Mr. Taylor) has joined in our discussions. He was always interesting to listen to in Committee, and he was entertaining this afternoon when taking us across the broad spectrum of what happens to industries when they are nationalised. However, I am rather surprised that he did not tell us what has been happening to the shipbuilding and ship repairing industries under private enterprise. He might have told us how they have lacked investment and how they are almost in the throes of collapse. They are not facing collapse because the Government are to take the industries into public ownership but because of the mismanagement that has occurred over many years.
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      It appears that most of the Opposition's case is based on the Press of the Chairman of the Bristol Channel Ship Repairers Limited. It has been said that my hon. Friend the Minister of State did not meet him, that he telephoned the company or that the company telephoned him. I do not understand all this concern about Bristol Channel Ship Repairers Limited. If ever a company spent money putting forward its case, it is the Bristol Channel Ship Repairers Limited.
      Surely my hon. Friend the Minister of State does not need to meet the company to know the case that it is trying to mount. He has been able to see it in the national Press. Almost every paper that we have picked up has been putting forward the case at great length. The company has had its own representatives in this place. They have assiduously lobbied Members. In Committee we were pressed to go to this or that luncheon to hear the case put again. I do not see any need for my hon. Friend further to consult the firm.
      I should like to know where all the money has been coming from. Surely it might have been spent to better effect, if only in higher salaries and wages for the company's employees.
      Mr. Teddy Taylor: Is the hon. Gentleman aware that the Government's pay policy prevents firms that make large profits from paying out more in wages?
      Mr. Hoyle: I did not catch what the hon. Gentleman said.
      Mr. Teddy Taylor: Does the hon. Gentleman appreciate that the Government's pay policy, that he supported and voted for, prevents successful firms from paying their workers more money?
      Mr. Hoyle: I understand the point that the hon. Gentleman is making, but he knows that I am opposed to the pay policy. Why is the hon. Gentleman looking so surprised? If the company could not pay the employees more money, it could have given them the lunches and dinners instead of giving them to Members of Parliament. That might have been one way in which it could have overcome the trivial difficulty that the hon. Gentleman presents to us. There are ways and means. I want to make a serious point—
      Mr. Tebbit: It will be the first one.
      Mr. Hoyle: I have yet to hear the hon. Gentleman make any serious point. I am willing to give way if he wants to make one now.
      Mr. Lambie: It will be compensation.
      Mr. Hoyle: Compensation or arbitration,
      Mr. Tebbit: We are all grateful to the hon. Gentleman for telling us that there are ways of circumventing the pay policy. We know that the General Secretary of ASTMS, Mr. Clive Jenkins, has been assiduous in torpedoing the Government's policy. But surely a Back Bencher who supports his Government should not be advocating the breaching of the Government's pay policy.
      As the hon. Gentleman is so anxious for further positive points, why does he think that the largest order to be placed recently in the British aerospace industry, an order for $100 million worth of work, has gone to a firm that has been left out of the Bill—namely, Fairey Aviation Limited? It has gone to its factory in Belgium. If he understands the answer to that question, he will understand why the industry will perish once it is nationalised.
      Mr. Hoyle: The answer is very simple and elementary. The fact is that the multinational companies are involved, and it is very difficult in many instances to follow what is happening and to know where the contracts go. This is one of the reasons that we need to take into public ownership industries which are vital to the wellbeing of our economy. That is the only way to exercise control over them, and to make sure that the orders stay in this country for the benefit of the people who work in the industry.
      Mr. Wigley: The hon. Member mentioned the need to take into public ownership companies which are vital to the economy. Does he believe that Bristol Channel Ship Repairers, employing 300 people, is a company which is dominating the economy and needs to be taken over? Being a passionate advocate of workers' control and of industrial democracy, would he accept that if a referendum of the employees of that company showed that they did not want to be nationalised, they should not be?
      Mr. Hoyle: The hon. Member has made a very interesting point in relation to Bristol Channel Ship Repairers. It is part of the ship repairing industry, and as such I think it should be taken into public ownership.
      I am particularly interested in the hon. Member's second point concerning the referendum that took place. I recall that in Committee I said that I had never seen such a high percentage vote outside the Soviet Union or the Eastern bloc.
      Mr. Ron Thomas: It was 101 per cent.
      Mr. Hoyle: I was reproached by the Chairman of Bristol Channel Ship Repairers, who explained how it was done. He said "We have not too many employees but I gave them time off to vote, and that was a material incentive for them to vote". I think we know, therefore, why there was a high percentage vote.
      I should be more interested in knowing why the white-collar employees of Bristol Channel Ship Repairers are not in trade unions. I was told by one of them that if he joined a trade union he would be likely to be dismissed by the company. I do not think that is a good example of how to aspire to democracy.
      We can imagine how the ballot figures were arrived at. The hon. Member for Caernarvon (Mr. Wigley) is not so naive as to raise that kind of question. I wonder how far this disease of support for Bristol Channel Ship Repairers is spreading on the Opposition Benches. It is not only the Conservatives and the Liberals who are involved. It has now spread to the nationalists.
      Mr. Wigley: And to Labour people as well.
      Mr. Hoyle: My hon. Friends have decided that they were perhaps a little mistaken. We had a vote—a kind of referendum—on the Government side, and they have now reconsidered their position. I think they have done a very statesmanlike thing.
      The delay caused by the Opposition—I have given the hon. Member for Tiverton due credit for it—has caused great dismay and frustration to the trade unionists in both industries. They want

      301
      the two corporations to get on with the job of producing public plans that will result in viable industries. They are also very interested in the proposals in the Bill for industrial democracy.
      This is the first time that the workers within the industries will have not only a say in them but also a chance to evolve their own thoughts on industrial democracy. This is bound to make for a new spirit within the industries. [HON. MEMBERS: "Rubbish."] I tell hon. Members who say "Rubbish" that this is not the view of the trade unionists to whom I have spoken in both the aircraft and shipbuilding industries.
      5.45 p.m.
      Mr. Loyden: Will my hon. Friend not agree that the Confederation of Shipbuilding and Engineering Unions, which represents the bulk of the workers in the industries, has had a policy over many years concerning nationalisation? Will he not agree that, if there were a referendum among them on public ownership, the results would be massively in support of public ownership?
      Mr. Hoyle: I am very grateful to my hon. Friend for his intervention. What he says is perfectly correct. What the confederation wants to do—and it speaks for the trade unions within the two industries—is to get on with the job of planning those industries.
      The hon. Member for Glasgow, Cathcart was quite right in one thing he said. That was when he was talking about the run-down in the shipbuilding industry itself. The run-down has occurred—as my hon. Friend the Member for Liverpool, Garston (Mr. Loyden) knows, with his knowledge of Merseyside—because of the lack of investment in that industry, and because of the very bad industrial relations in it.
      Mr. Loyden: Here is a shipyard worker.
      Mr. Hoyle: I am very grateful to my hon. Friend for drawing to my attention the fact that the hon. and learned Member for Kinross and West Perthshire (Mr. Fairbairn) has just entered the Chamber. But I do not think that the hon. Gentleman is a shipyard worker. What I know is that the bulk of the Opposition Members are supporting the efforts of
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      the company in trying to escape public ownership.
      What we are really interested in—it has been explained very many times—is decentralised industry. The taking over of the industries does not mean that there will be a very powerful central office. The hon. Member for Cathcart has painted a very gloomy picture indeed in talking about huge palatial offices in London that will house both corporations. The head office for the shipbuilding corporation might be on the Tyne or it might be in Scotland. Who knows? It might even be down in Wales. But wherever it is put, it is said that the power will still reside in London. I suggest to the hon. Member for Glasgow, Cathcart that we have taken care of this to some degree by our introduction of industrial democracy into the Bill. This will mean that the workers within the industry will have a say in where the headquarters is situated and in what is done at the headquarters.
      I know that this is very difficult for Opposition Members to comprehend, but it will mean a new direction in the management of the corporations. There will be a new dimension added to them. For the first time the people within the industries will be able to participate in the decisions that matter.
      Mr. Tebbit: Oh, come off it.
      Mr. Hoyle: The hon. Member tells me to come off it. I suggest to him that it will not only be possible but that it will be the result of these two corporations being set up.
      The real tragedy is the delay that has occurred because of the activities of the hon. Member for Tiverton. This has resulted in delay in the formulation of the plans of these two corporations. The frustration that is felt among the people working in the industries will be visited on the Conservative Party whenever there is a General Election.
      Indeed I recall what was said to me by one of the trade unionists in Cheadle in Cheshire. I was about to describe it as a safe Tory haven, but I know that it had a Liberal Member for a short period. The trade unionist told me that there will be 1,000 aircraft workers on the streets in Cheadle challenging the hon. Member for Cheadle (Mr. Normanton)

      303
      on his activities in delaying the implementation of the Bill. They will be right to do that. If it had not been for the Opposition we should have been far nearer our goal.
      We shall be able to put forward a plan. My hon. Friend the Member for Bristol, North-West said that the two airframe corporations in the country had never put forward plans without asking for Government aid. They have always asked for help from the Government in the past.
      Mr. Ron Thomas: Does my hon. Friend realise that public support to the aircraft industry amounts to about £5 million a week?
      Mr. Hoyle: That fact shows the bankruptcy of the policy followed by the Opposition.
      The sooner we put this Bill on the stocks the better it will be for the people working in those industries.
      Mr. Tom King: If the quality and depth of reasoning behind the speech made by the hon. Member for Nelson and Colne (Mr. Hoyle) is part of the contribution of the Labour Party towards devising the plans for the nationalisation of the industries involved, God help those industries.
      The hon. Gentleman referred to delay. The point was put clearly by my hon. Friend the Member for Chingford (Mr. Tebbit). This Bill could have been introduced in November 1974. The Government delayed its introduction until April 1975. First Reading took place in April 1975, Second Reading in December 1975. The selection of amendments for the Report stage was made on 25th May. I used a copy of that document in preparing for this stage. We find ourselves dealing with this Bill on 27th July 1976. The hon. Member for Nelson and Colne has the nerve to say that the Bill has been delayed for two months and that the Conservative Party are responsible for that delay. When we remember the damage done by the Minister of State, who was involved in the Department that delayed this measure, there is no reason for the hon. Gentleman to sneer. Damage has been done to national assets in the shipbuilding, ship repairing and aircraft industries as a result of the threat of nationalisation from the dreadful process
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      of national Labour Party conferences and NEC resolutions. The damage done to those industries by the nationalisation proposal will soon begin to be appreciated.
      The Government are bulldozing this measure. We shall shortly come to the guillotine procedure and the time for closure. This is an unprecedented situation. The Bill has been recommitted to a Committee of the whole House before the Report stage so that the Government may pass these sordid little amendments to cover a political deal which was concluded when they were in opposition. At that time they realised in a blinding flash of realism that we could not attract inward investment if there were a threat of nationalisation hanging over the companies that might invest here. One union leader had sufficient wit to realise that fact, and as he had sufficient "clout" over the Labour Party when in Opposition, that deal was done. That deal caused all the problems with which the Government are faced with this Hybrid Bill. These wretched little amendments put forward by the Secretary of State are the sordid way in which the hybridity must be covered up.
      We have made our position abundantly clear. We believe that morally and practically this is a Hybrid Bill. We support that finding, on prima facie evidence, by Mr. Speaker. We shall comment no further on the unfortunate way in which the Government have chosen to proceed in the past two months.
      That brings us to the outcome of these paltry amendments. We shall certainly vote against them and treat them with the contempt they deserve.
      Mr. Varley: Ministers in charge of Bills in Committee on the Floor of the House and upstairs take much abuse. They ought not to complain about that. There are occasions when guillotines are introduced. There are equal opportunities for Ministers and their Back-Bench supporters to use that time. I hope that in the remaining stages my hon. Friends the Members for Nelson and Colne (Mr. Hoyle), for Liverpool, Garston (Mr. Loyden) and for Bristol, North-West (Mr. Thomas) will at least make sure that they take an equal share of the time and perhaps repay some of the abuse that they have taken from the Opposition in

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      58 sittings. I am sure that they will take that time.
      There was a hilarious and bizarre contribution from the hon. Member for Tiverton (Mr. Maxwell-Hyslop), who claimed that he wanted to speed up the Bill when we know that his efforts were directed at preventing the Bill from getting on to the statute book. I make no complaint. He should have told the House that his good fortune, as he would no doubt describe it, came to him by chance. The hybridity point was taken in the first instance not to a member of the Conservative Party but to a member of the Liberal Party, who was not greatly involved. I understand that the point was taken to the hon. Member for Henley (Mr. Heseltine) who thought that it was too hot to handle. He decided that there was a good crank in his party called Maxwell-Hyslop and thought "Let us hand it over to him". That is exactly what happened. That is how the matter came to the light of day.
      Mr. Tebbit: He put a spoke in the Government wheel.
      Mr. Varley: It was a spoke in the wheel. Therefore on 27th May we said that we would table amendments. That was the reason why we took steps.
      Mr. Edward Gardner: On a point of order, Mr. Murton. Is it right that a Minister should be allowed to mention an hon. Member by name?
      The Chairman: It is not customary but it may occasionally happen in error.
      Mr. Varley: That is how it happened.
      I thought that I moved the amendments in a non-controversial way. The matter developed into a procedural debate. There were discussions about the British Steel Corporation, the British National Oil Corporation and oil platforms. I make no complaint. However, as I have only two minutes left I do not think that I may answer those matters.
      I found the speech by the hon. Member for Glasgow, Cathcart (Mr. Taylor) schizophrenic. He claimed that nationalisation was terrible and would do great damage to industry in Scotland. We all know that the hon. Gentleman was one of the keenest supporters of the national. isation of the Govan shipyard. As a
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      result of Scottish interest in Rolls-Royce, he was one of the keenest Members of the Conservative Party in favour of the nationalisation of Rolls-Royce. I find it hard to take from the hon. Gentleman, who tries to give the impression—
      Mr. Teddy Taylor rose—
      Mr. Varley: I cannot give way as have only two minutes left.
      Mr. Teddy Taylor rose—
      Hon. Members: Give way.
      Mr. Varley: I usually give way, but there is only about one minute to go. Bristol Channel Ship Repairers is another story. I have heard many unseemly stories about the Bristol Channel gravy train and all kinds of irregular practices that have been induced—
      It being Six O'clock, The CHAIRMAN proceeded, pursuant to Orders [20th July and this day], to put forthwith the Question already proposed from the Chair.
      Question put, That the amendment be made:—
      The Committee divided: Ayes 300, Noes 287.
      [For Division List No. 282 see col. 597]
      Question accordingly agreed to.
      The CHAIRMAN then proceeded to put forthwith the Questions necessary for the disposal of the Business to be concluded at Six o'clock.

    Schedule 2

      SHIPBUILDING INDUSTRY
      Amendments made:
      No. 2, in page 76, line 41, leave out 'converting'.
      No. 3, in page 77, line 39, after 'tons', insert:
      'but does not include a hovercraft or a mobile offshore installation'.
      No. 4, in page 78, line 2, at end add:
      '(2) In sub-paragraph (1) above "mobile offshore installation" has the same meaning as in Part III of the Industry Act 1972, namely, any installation which is intended for underwater exploitation of mineral resources or exploration

      307
      with a view to such exploitation and can move by water from place to place without major dismantling or modification, whether or not it has its own motive power.'.—[Mr. Varley.]
      Bill reported, with amendments; as amended (in the Standing Committee and on recommittal), considered.

      '.—(1) Subsections (3) to (6) below shall have effect where a person engaged in shipbuilding, other than—

      5

      (a) British Shipbuilders, or

      (b) one of its wholly owned subsidiaries, or

      (c) a body corporate the whole of whose equity share capital is held by or on behalf of the Crown,

      makes to the Secretary of State a written complaint that a practice employed by British Shipbuilders or one of its wholly owned subsidiaries in relation to the sale of ships is unfair to the complainant for a reason specified in the complaint.

      10

      (2) Subsections (3) to (6) below shall also have effect where a person engaged in shiprepairing, other than—

      15

      (a) British Shipbuilders, or

      (b) one if its wholly owned subsidiaries, or

      (c) a body corporate the whole of whose equity share capital is held by or on behalf 15 of the Crown,

      makes to the Secretary of State a written complaint that a practice employed by British Shipbuilders or one of its wholly owned subsidiaries in relation to the provision of shiprepairing services is unfair to the complainant for a reason specified in the complaint.

      20

      In this subsection "shiprepairing" includes refitting, converting or maintaining ships, 20 and "the provision or shiprepairing services" has a corresponding meaning.

      25

      (3) The Secretary of State shall forthwith after receiving the complaint send a copy of its to British Shipbuilders and, after such period for consideration of, and comment upon, the complaint by British Shipbuilders as the Secretary of State thinks reasonable has elapsed, shall send to the complainant a statement of any comments made by British Shipbuilders on the complaint and if he is of opinion—

      (a) that the complaint raises a question of substance and

      (b) that the complainant has a reasonable case to make in support of it, shall afford the complainant and British Shipbuilders an opportunity of making representations in relation to the matter to a person appointed by the Secretary of State.

      30

      (4) The Secretary of State shall consider the report of the person appointed under subsection (3) above and, if it appears to him that the practice complained of is unfair to the complainant, shall give British Shipbuilders such directions as appear to him to be requisite to secure the removal of the ground on which it is unfair.

      35

      (5) The Secretary of State shall furnish the complainant with a statement of any such directions.

      40

      (6) When a complainant avails himself of the right to make representations conferred by subsection (3) above, the Secretary of State shall furnish the complainant and British Shipbuilders each with a copy of the report of the person appointed under that subsection, and a statement of the conclusions reached by the Secretary of State on considering the report.'.—[Mr. Les Huckfieldl.]

      Brought up, and read the First time.
      The Under-Secretary of State for Industry (Mr. Les Huckfield): I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker (Mr. Oscar Murton): With this clause we are to take the following amendments:
      (a), in line 8, after 'to', insert
      'the procurement of materials, plant and services for the production of, and'.
      (b), leave out lines 2 and 3 and insert:
      'one or more of the activities specified in section 2(1) or (2) above, other than—
      (a) a Corporation, or'.

    New Clause 1

      RIGHT OF PERSONS ENGAGED IN SHIPBUILDING OR SHIPREPAIRING TO OBJECT TO PRACTICES OF BRITISH SHIPBUILDERS OR ITS WHOLLY OWNED SUBSIDIARIES
      (c), in line 7, leave out 'British Shipbuilders' and insert 'a Corporation'.
      (d), in line 8, leave out 'the sale of ships' and insert 'that or those activities'
      (k), in line 37, leave out 'British Shipbuilders' and insert 'the Corporation concerned'.
      (e), leave out lines 10 to 20.
      (f), in line 22, leave out 'British Shipbuilders' and insert 'the Corporation concerned'.
      (g), in line 23, leave out 'British Shipbuilders' and insert 'the Corporation'
      (h), in line 24, leave out 'British Shipbuilders' and insert 'the Corporation'
      (i), in line 28, leave out 'British Shipbuilders' and insert 'the Corporation'.
      (j), in line 32, leave out 'British Shipbuilders' and insert 'the Corporation concerned'.
      We are also to take New Clause 2—Right of persons engaged in the aircraft industry to object to practices of British Aerospace or its wholly-owned subsidiaries.
      Mr. Huckfield: The subject of legal safeguards for the private sector against unfair trading practices by the public sector took up a great deal of debating time in our Standing Committee. When the matter was last discussed on 4th May I undertook on behalf of the Government to introduce on Report a new clause, modelled on Section 30 of the 1967 Iron and Steel Act, which would deal with unfair trading against British shipbuilders in the sale of ships, in other words, the main shipbuilding activity. As a result of a fair amount of pressure from my right hon. Friend the Member for Sunderland, North (Mr. Willey) I undertook to consider the desirability of including ship repair.
      It is as a result of that reconsideration that I introduce New Clause 1. It extends to both the sale of ships and the sale of ship repair services. In other words, it covers the two industries which after vesting day there will be continuing competition in main line activities between the public and private sectors. We have not included slow-speed diesel marine engines because the companies named in the Bill have no private sector competitors in that field and one of the private sector shipbuilders will be customers for slow-speed diesel engines because they build small ships.
      The Government fully recognise that anxieties exist in the industries mentioned and it is hoped that the powers in the clause need never be used. Even the powers in Section 30 of the Iron and Steel Act were only used once and that section has now been repealed.
      Mr. Tom King: That was a wholly inadequate introduction to a very important new clause. We give a modified welcome to the clause. It is a very important
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      departure, as the right hon. Member for Sunderland, North (Mr. Willey) has recognised. He pressed his case very strongly in Committee. The Under-Secretary introduced the clause very tersely and without justification or explanation of the way in which it has been constructed.
      The Under-Secretary, who claims to have read all the Committee Hansards, will know that this matter was debated twice in Committee. The hon. Member for Glasgow, Kelvingrove (Mr. Carmichael), when he was Under-Secretary, justified the Government's not taking any action. The subject reappeared in a new clause introduced by the right hon. Member for Sunderland, North, and the Government moved their ground and made concessions, but failed to meet the points that we had raised.
      What we are getting at in New Clause 2 will be obvious to the Minister. It is a view that we expressed in Committee. New Clause 1 deals specifically with shipbuilding, ship repairing and with the sale of ships. When it was hinted in Committee that the Government might take this position, we asked why it was limited to the sale of ships and whether it meant all practices in the production of ships. It is important to know whether it involves such activities as the procurement of materials.
      The Government have partly accepted our case by introducing New Clause 1, but there is concern that a major State organisation operating in this industry could, like any other monopoly manufacturer, use its powers to the detriment of other firms in the industry. We assume that it is not the ambition of the Government that the creation of British Shipbuilders should put smaller shipbuilding concerns out of business, with the consequent loss of jobs. We assume that it is the Government's aim that these firms should continue to prosper and that the Government do not wish to freeze out any firm that wants to enter the industry. We are not aware of an embargo against anyone starting up these activities.
      However, a major manufacturing operation has considerable power and it could be used unfairly to the detriment of the smaller companies in the industry. There are relevant sanctions in the Fair

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      Trading Act, but such manufacturers can put pressure on the suppliers of materials to prevent their serving other customers, or to obtain preferential trade terms for themselves.
      We had a series of unsatisfactory answers in Committee. The hon. Member for Kelvingrove said:
      "We would not expect the corporations to use their commercial freedom to the detriment of the United Kingdom industry as a whole."—[Official Report, Standing Committee D, 22nd January 1976; c. 396.]
      I am sure that we would not expect it, but it could happen.
      My hon. Friend the Member for Glasgow, Cathcart (Mr. Taylor) asked whether there would be any preferential pricing arrangements with the British Steel Corporation and the new Under-Secretary, the hon. Member for Nuneaton (Mr. Hurchfield), repeated a carefully worded statement saying that the corporation had assured him:
      "that it will continue to make steel available to its customers on an equitable basis, subject to normal commercial considerations."—[Official Report, Standing Committee D, 4th May 1976; c. 2870.]
      What on earth does that mean? It can only mean that the corporation will do whatever it wishes and will defend its actions by saying that it was guided by commercial considerations. There is no protection in that statement.
      My hon. Friend the Member for Cathcart asked later for a specific assurance that the BSC would not offer steel to the nationalised part of the industry more cheaply than to the private side. The Minister of State repeated the carefully worded statement that had been prepared by the BSC to give it total freedom of action.
      I accept that it is not entirely unreasonable that steel should not be sold at exactly the same price to all customers. There may be quantity discounts or other special terms, but there is a wide range of matters in which some firms could face discrimination. For instance, at times of shortage of supplies the smaller customers might find that no supplies are available to them and that the largest customers—the nationalised corporations —will take the whole output.
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      The Under-Secretary referred to Section 30 of the Iron and Steel Act. Hon. Members who look up the Committee proceedings on that measure will find them laden with assurances that the corporation would act in a responsible nondiscriminatory way. It was said that the Section 30 procedures should not be needed, but they were included in the Bill and they were used. On the occasion that they were invoked, it was found that the complaints by the private sector—the British Independent Steel Producers' Association—were justified, and the BSC had to change its pricing policies.
      We have been this way before. We have had bland ministerial assurances that nationalised corporations will act responsibly. I am not suggesting that the corporations act out of malice or vindictiveness, but they can over-reach fair competition and use various measures to the detriment of others in the industry.
      The right hon. Member for Sunderland, North, without making any accusations of malpractice or vindictiveness, felt that it was important to have protections, and the Government have partly recognised that by the introduction of New Clause 1. The right hon. Member seemed to accept our arguments when he introduced a new clause in Committee dealing with both corporations. It said:
      "is engaged in one or more of the activities specified in section 2(1) or (2) above"
      and dealt with the procedure for making a written complaint.
      6.30 p.m.
      The Minister said that he would accept that in part. He said he was in sympathy with the principle. We had all the usual trite expressions that we get on such occasions when Ministers propose to do something markedly different from what is suggested. The Minister added:
      "However, I recognise that there is concern on the part of small shipbuilders who remain in the private sector. I am sure that my right hon. Friend has noticed some of the correspondence that we had in the Financial Times and The Times, recently, and from those representing the private shipbuilding interests. Their main concern arises because they will be competing with British Shipbuilders."— [Official Report, Standing Committee D, 4th May 1976; c. 2858–61.]
      That was the limit of how far he was prepared to go. That was the justification because only shipbuilders had complained.

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      But in fact the right hon. Member for Sunderland, North had specifically mentioned Greenwell in his speech and his concern about its situation. He quickly made the point that as far as he was concerned shipbuilding included ship repair. But the Minister made clear that he had referred only to the clause about shipbuilders. Having rested his case on the argument that there was concern about shipbuilders, as soon as the right hon. Gentleman mentioned that he would like to include ship repairing as well, the Minister rushed off, without any justification, or any argument, to say that he would undertake to consider carefully the points about the ship repairing industry being the same as shipbuilding. He gave an undertaking about the introduction of an amendment on Report.
      We have got the new clause on Report to cover ship repairing and shipbuilding. But the Under-Secretary made no attempt to answer the question I have consistently asked about the significance of the use of the word "sale". Does it cover the whole operation?
      The hon. Member for Renfrewshire, East (Miss Harvie Anderson) mentioned a shipyard which felt that it had been unfairly discriminated against—I think it was the Ailsa Yard—in the placing of a Government contract. It is an area where there could be discrimination in the sale of a ship. But that is only a simple example.
      There is the procurement of materials and services and there could be matters affecting employment policies, all of which could involve discrimination against people not within the nationalisation network. Can the Minister make quite clear what the significance of "sale" is?
      Mr. Les Huckfield: Perhaps I can put the hon. Gentleman out of his misery at a fairly early stage. New Clause 1 includes both the sale of ships and the provision of ship repairing services.
      Mr. King: We do not seem to be communicating. That is not my question. The provision of ship repairing services seems to be a wider category. What I am concerned about is whether it covers what I would call "production matters and procurement matters" as well as sale. That is the point.
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      The Under-Secretary must appreciate this point because it will have been thrust on our amendments. That is what they are all about. We are saying there should not be some narrow technicality which limits this from being a genuinely fair, competition, non-discrimination clause. This should be a wider ranging protection covering all the operations of these corporations.
      The other safeguard relates to pricing. In respect of pricing we have an answer from the hon. Member for Kelvingrove to say that the corporations could not discriminate by unfair pricing because they would be required by the Treasury —[Interruption.] It is difficult to address comments to the Under-Secretary because there seems to be a continual conversation on the Government Front Bench. The Minister of State is now the sixth person who is carrying on a conversation with the Under-Secretary when I am trying to address points to him.
      The question is whether corporations can compete unfairly by quoting unfair prices and thereby put other and smaller yards out of business because they cannot compete with those prices. The answer given to that and the defence advanced was that the corporations would be required to show a definite rate of return on their capital by the Treasury. That is total rubbish, because in a corporation of this size, with the number of yards which are active, it is the oldest trick in the book, within the generality of showing what may be a reasonable rate of return, to decide to pick off certain competitors and have a drive on the particular kind of ship that they may produce and to under-price.
      In the retail trade it is called "a loss leader". There are plenty of companies in this country that show a very adequate return on capital but are still able to run loss leaders in certain areas. As the Under-Secretary appears to understand that point, he will appreciate that it is no protection at all to say that the corporation overall has to show an adequate rate of return.
      Mr. Tom Litterick: Is the hon. Gentleman suggesting that it is all right for a private repair chain to use a loss leader technique in its activities but wrong for a public corporation to use a loss leader in its selling strategy?
      Mr. King: The point is that within the private chain, which might operate a loss leader in a particular area to stimulate sales of a particular line, the commercial stategy is that it would have to do it within the constraint of being a profitable organisation, otherwise it would not survive. The private chain has that constraint upon it. I would ask the hon. Member for Birmingham, Selly Oak (Mr. Litterick), if the British Shipbuilding Corporation is set up and if in fact it makes losses, does he think that it will be closed down? The answer is "No". The practical answer is that it will continue. Therefore, the comment I would make in this situation is that there is not the same constraint on a nationalised industry.
      Although the nationalised industries may be required to achieve an adequate return on capital, I believe that if that is not achieved the sanctions which the Treasury may set out are very weak. The history of the nationalised industries is littered with targets having been set and targets not having been achieved, and the result has been that no real sanctions have been applied.
      Mr. F. A. Burden: Would not my hon. Friend agree that if a private company behaves with undue discrimination, or discriminates improperly, that can be questioned on the Floor of the House, but with a national corporation it would fall within the day-to-day operations and could not be questioned on the Floor of the House? I think that is one of the great dangers.
      Mr. King: I accept my hon. Friend's observation and I would go further. Usually these powers can be used most effectively when a company is in a monopoly position, but a sanction is possible under the powers of the Director General of Fair Trading. Where these powers exist they can be referred and investigated and action taken. But the effect of nationalised industries is that in many areas they are de facto monopolies.
      I do not think this is a tremendously contentious view. After all, why do we set up the Post Office Users' National Council and the consumer councils of the nationalised industries?
      This is all part of our worry—as much in the Labour Party as among the Opposition—about some of the practices
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      of nationalised industries. Disconnections by electricity boards are a classic example of monopoly power. There must be protection against unrestrained use of these powers. The Government's new clause, to which I give a limited welcome, shows that they accept a measure of what I am saying. The principle behind it was initiated by the right hon. Member for Sunderland North. I make that point before anyone says that this is a dangerous, reactionary, right-wing Tory move.
      We have digressed into the subject of loss leaders, but the only answer that we have been given is that the overall financial targets of the corporations are protection against individual unfair pricing. I leave hon. Members to draw their own conclusions. No doubt they will be able to say whether they think that that protection will be adequate if there is a small shipyard in their constituency that does not come under the Bill, or if a small company wants to set up there in one of the areas in which these corporations will be working.
      Am I right in believing—we have had no clear statement on this—that the reason for the reference in the new clause to only one of the corporations, when surely in equity the principle applies to both, is the Government's argument that no companies could be affected in the aircraft industry? If so, that is a limited approach to aircraft manufacture. In aircraft production, as in shipbuilding, an enormous number of items are bought in. The method of operating procurement policies by the corporations could discriminate heavily against certain aircraft companies.
      It is difficult to see why this principle is not accepted for both industries. Our new clause would merely provide the same protection for those aggrieved by the British Aerospace as for those aggrieved by British Shipbuilders. This is an important area for the Government to tackle. They talk of the need for fixed frontiers and a vigorous and profitable private sector. However, if people are going to compete in these fields, they must feel that they have proper protection against public corporations which, perhaps not intentionally but by over-zealous pursuit of commercial objectives, discriminate unfairly against them.

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      6.45 p.m.
      We are obviously concerned about the existing companies, but the Minister's answer suggested that no one in his Department had considered the possibility of a new company starting up in any of these activities. He dealt only with the existing situation. No doubt the intention is that these corporations will last for a considerable period, so someone might start producing, for example, slow speed marine engines, and someone else could decide on an activity which would make him a customer of the first company. Someone might go into the aerospace industry or set up as a components manufacturer.
      These people should have the same protection as is proposed for shipbuilding and ship repairing. If the Government are sincere in their attempt to establish this principle, they should accept the amendments to New Clause 1 along with New Clause 2. I should like to know whether, if New Clause 1 and the amendments to it are accepted, New Clause 2 will be necessary. That would ensure the same principle for both corporations and that is the right way to tackle this important matter.
      Mr. Frederick Willey: As the hon. Member for Bridgwater (Mr. King) will appreciate, I can give a stronger welcome to the new clause, which is substantially the one that I put down in Committee. I appreciate the Government having brought it forward. I differ from the hon. Member. I did not welcome the fact that the Bill deals with two industries at once and I speak only for shipbuilding and ship repairing. The same goes for the clause.
      I put forward my new clause in Committee—here again, I differ from the hon. Gentleman—because although I did not support the Conservative amendments. I felt that this was a case not of anticipating malpractices but of affording people a legislative safeguard if they fear that malpractices are possible. I realised that small shipbuilders who were left outside the Bill might fear unfair competition.
      I was also concerned, particularly, about the closure of Greenwells in my constituency. This is a State yard which has been closed during our Committee proceedings. We are trying to attract
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      private enterprise to reopen it. I felt that the least that I could do was to try to reassure anyone who reopened it that he would be safeguarded against unfair competition. That is why I am satisfied.
      I was a little concerned when the Minister seemed surprised by the suggestion that this provision should apply also to ship repair. It is clear that the intention is to apply the new clause to ship repair as well as shipbuilding. My major concern, because of the closure of Greenwells, was with ship repair. I still have some hesitation about the reference to sale of ships, but here, too, the Government's new clause is acceptable in the context of shipbuilding. I have discussed this matter with the SRNA.
      At least the Government have been consistent in following precedent. The precedent is important because we want to ensure that there is a simple and expeditious procedure for any complaint to be immediately examined and the complainant satisfied. That is what the clause does. For that reason, speaking within the confines of shipbuilding and ship repairing, I am well satisfied with it.
      Mr. Tebbit: We are grateful to Mr. Speaker whose selection of amendments and new clauses enables us to discuss unfair competition broadly in this debate.
      The point underlined so well by the right hon. Member for Sunderland, North (Mr. Willey) is that there is a need, if additional firms are to continue in industry outside the public sector, for clear and proper provisions for appeal against unfair competition. I find it remarkable, though perhaps not surprising, that the Secretary of State has accepted that this concept should apply to the shipbuilding and ship repair industry, but not to the aircraft industry.
      Some firms will continue in business in the private sector. If the Under-Secretary of State does not know—presumably he does not know, or the Government would have done something about it—there is, for example, Flight Refuelling Limited which, amongst other things, specialises in the manufacture of targets. These are expensive items, Doughty of Cheltenham manufactures a large range of components. Marshalls of Cambridge

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      specialises in aircraft repair and the fitting out of what are known as green air frames.
      To some extent, some of these problems could be resolved by restrictions on the diversification possibilities of the proposed British Aerospace corporation, but not altogether. The fitting out of air frames, the repair of aircraft and the manufacture of targets is already undertaken by firms which are being brought into State ownership by the Bill. Therefore, that would not constitute diversification.
      My hon. Friend the Member for Bridgwater (Mr. King) pointed out that there is to be no legislative bar on new firms coming into the manufacture of aircraft, or ships for that matter, under this legislation. If the Under-Secretary of State could for a moment restrain himself from nattering to the Minister of State for Sport and Recreation and pay some attention to what is going on, it is just possible that he might do himself a service because he might then be able to answer first time round the points being made, instead of realising that he has not heard a word because of his incessant nattering.
      I was saying that there seems to be no legislative bar—if the Minister of State for Sport and Recreation could restrain himself, it would be useful.
      The Minister of State for Sport and Recreation (Mr. Denis Howell): Pompous ass.
      Mr. Tebbit: I do not know whether "Pompous ass" is the kind of parliamentary expression that we should hear from the Minister of State for Sport and Recreation. I do not know what his functions are, except to sit there nattering to the Under-Secretary of State for Industry. If he could manage to stay quiet and keep out of this matter, as he does not understand it, it would be helpful to the debate.
      I was saying for about the third time —now that I have the Under-Secretary's attention—that there appears to be no legislative bar on new companies coming into aircraft manufacture. Therefore, the Government presumably would not be unhappy if a new firm—for example, one of the American manufacturers of light
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      aircraft—were to consider coming to Britain. Some have already considered coming here, but have decided not to do so for reasons which do not concern us today.
      What would happen if the Piper Aircraft Company were to come to Britain to manufacture aircraft? Would it be unprotected against unfair competition although Marathon, an American-owned company in the shipbuilding industry, would be protected? What is the logic in the Government's thinking of protecting one industry, but not the other? Did they not appreciate that somebody else might want to manufacture in this country? Do they not want anybody else to come into aircraft manufacture?
      It is becoming generally known that it is the intention of the Organising Committee for British Aerospace—[Interruption.] The Minister seems to have assistance somewhere. It is now becoming obvious that amongst the decisions, which have probably been made by the Organising Committee for British Aerospace, is a decision to close the BAC factories at Weybridge and Hurn and that it may now he discussing the moving of work from the factories at Dunsfold and Kingston to the factory at Hatfield, which is a marginal seat.
      I do not know what that fellow on the Treasury Bench with his feet on the Table is nattering about now, Mr. Deputy Speaker, but it is difficult to make oneself heard.
      Mr. Deputy Speaker (Sir Myer Galpern): Order. With all these disturbances I am having great difficulty in following the argument. I appeal to hon. Members to allow the hon. Member for Chingford (Mr. Tebbit) to carry on with his speech uninterrupted.
      Mr. Tebbit: I am grateful to you, Mr. Deputy Speaker.
      As a result of these impending factory closures, many highly skilled men and very good facilities will be available. I hope that the Government will be in-interested in trying to bring in outside firms to take over those facilities in order to provide new jobs. It can be done. Fairey Aviation has landed a contract for $100 million worth of production, but not in Britain because of the Government's activities.

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      We could get work into this country outside the public sector in those factories which the Organising Committee for British Aerospace is now proposing to abandon, but we shall not get outside companies to come in unless they are guaranteed as much protection as the shipbuilding industry. The lack of a clause of this nature would be a further disincentive to that inward investment in this country which would provide the jobs which will be sorely needed in the aircraft industry to replace those which will be lost when the Bill is enacted, if that misfortune should befall the industry.
      I hope that in reply the Minister will tell us why only the shipbuilding industry needs the provisions of New Clause 1 and why there are no similar provisions for the aircraft industry.
      Mr. John Evans: As my constituency is 25 miles from the sea and as some hon. Members may wonder about my interest in the shipbuilding and ship repair industry, I should make it clear that when I left school at 15 years of age I went into the Swan Hunter shipyard on Tyneside where I served my apprenticeship as a fitter. I have since worked in every shipbuilding and ship repair yard on Tyneside, Wearside and in three yards on the Tees. I left the employment of Swan Hunter—
      Mr. W. E. Garrett: My hon. Friend is being modest. I think that he should mention that he spent some years at sea sailing the ships he helped to build.
      Mr. Evans: I was going to mention that later.
      I left the shipyards in February 1974 when I was elected to this House. I collected my tools from the Swan Hunter shipyard at Hebburn, and they are still in my garage. If political misfortune should ever befall me, I should be happy to go back to work with my colleagues in the shipbuilding industry.
      Frankly, if we do not nationalise the shipbuilding industry quickly, there will be very little of that industry left on the North-East Coast or on Merseyside.
      The hon. Member for Bridgwater (Mr. King), who would not give way earlier, asked whether, if the industry did not prove profitable, it would be closed down. The hon. Gentleman answered the question himself by saying "No". Is the
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      hon. Gentleman aware that there has not been a profitable shipbuilding firm in Great Britain for the past 25 years? Each and every one has been sustained by Government grants, handouts, investment grants in regional areas or Government orders for warships for the Navy. If they had been left to their commercial selves they would have collapsed a long time ago.
      7.0 p.m.
      As the hon. Gentleman is aware, this is not the first reorganisation of the shipbuilding industry. There was a reorganisation of the shipbuilding industry in the late 1960s following the Geddes report. On that occasion under a Labour Government we poured hundreds of millions of pounds into the British shipbuilding industry, but we left it in the hands of private enterprise, even though workers—I use the word "workers" and not the phrase "trade unionists", which Opposition Members seem to be trying to use to divide them into two different camps—in the industry were demanding that if the Government were pouring millions of pounds into the industry it should be brought under public ownership. However, it was not. What was the end product of the Geddes reorganisation? It was the virtual collapse of the shipbuilding industry.
      We are addressing ourselves in this clause to unfair competition. I welcome anything that will do anything to do away with that. We should deal with a far more important aspect of unfair competition, which has worried workers and employers in the shipbuilding industry for many years, and that is the degree of unfair competition from shipyards abroad. I should like to see something in the Bill which would insist that, if the Government are satisfied that there is unfair competition, from continental or Japanese shipyards, or new shipyards in other parts of the world financed by American or even British capital, they will take action to protect the British shipbuilding industry. That is one of the main worries of all those who work in the industry.
      We all recognise that it is a shrinking industry. The workers certainly recognise only too clearly that it is a shrinking industry, and they are neither fools nor are they blind; they can read trade figures and statistics as well as anyone

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      else. They are well aware of the decline of the British share of the world shipbuilding order book, much of that due to unfair competition.
      Putting that on one side, the argument about investment in the industry has always fallen on deaf ears under a Labour Government and certainly has fallen on deaf ears under a Conservative Government. I suggest to the hon. Gentleman that, while we give consideration to unfair competition in the domestic scene, it is equally important, indeed, more important, that we give consideration to unfair competition on the international scene.
      When one considers the record of nationalised industries over the last few years, the protection that the public have is far better in a nationalised industry than in most industries in the private sector. One of the areas from which the British public get considerable assistance is the Press. It is only too happy to chase or to harry or to, look, into any misdemeanour alleged against nationalised industry as far as the consumer is concerned. I am sure that when the day dawns for the shipbuilding industry to run down, with the consequent pay offs, it will be national headlines in the national Press. There were never any headlines in anyone's Press when the shipyards of Tyneside and Merseyside were paying off hundreds of thousands of workers just before the public holidays, at Christmas and at Easter. No one was interested in us then. No doubt they will be interested in the future whenever there is a rundown of an industry.
      As for unfair competition, there obviously will be times when the nationalised boards will have to give consideration to the overall position, to the employment prospects of people in the industry. Shipbuilding and ship repairing are largely based on the development regions. Certainly, no one can deny that it is one of the major employers in the North-East of England, on Clydeside and on Merseyside. Essential judgments will sometimes, as in the past, have to be made not based entirely on commercial criteria.
      As for unfair competition and the prospects for the industry, this Bill is one of the greatest examples of ensuring that
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      the business of this industry is conducted in an open, fully public fashion, if our proposals on worker participation are put fully into operation. If we can ensure that the workers are taking part in all decisions on pricing, ordering, employment prospects and on what the nationalised boards' policy is to suppliers in the industry, then we shall not go very far wrong. One of the things a successful industry needs is a large number of suppliers. This is certainly true of industry in the North-East and on Merseyside. It is in the nature of the industry that it must have outside suppliers providing a wide variety of materials and a wide variety of labour. If that continues in the future I shall be satisfied in that respect as a shipbuilding worker.
      I hope that the Minister will address himself to the much wider problem of unfair competition when it comes from abroad and puts the jobs of thousands of workers at risk.
      Mr. Kenneth Warren: I recognise that the hon. Member for Newton (Mr. Evans) speaks with the sincerity of a man who was an apprentice on the shop floor and who knows his industry. I was an apprentice on the shop floor in the aircraft industry. I have much in common with his feelings that the workers ought to have an opportunity and a chance to take part in running their own industry. I fear that there is a wider gulf between the hon. Gentleman and his own Minister than there is between him and me. I shall demonstrate that in terms of the new clauses.
      First, the hon. Gentleman said that he hoped that nationalisation would save jobs, but the hon. Member for Bristol, North-West (Mr. Thomas) said in a previous debate that he did not accept that nationalisation would save jobs. The difference between those two statements is the reality of what is going to be nationalisation as opposed to that which has been promised. No one regrets that more than I do. However, the hon. Gentleman having worked on the slipways will know that the only people who can save jobs are the customers. That is the only way in which one can have a full shipyard or full production line in an aircraft factory.
      Mr. John Evans: May I just clarify what I meant to say—I said it in the

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      heat of the moment—rather than what the hon. Gentleman alleged I said? What I intended to say was that if the industry is not nationalised there will be very little industry left if it is left in private hands. In that context nationalisation will save jobs.
      Mr. Warren: That would be acceptable if the Government could afford to nationalise and put in the money required to save jobs. The hon. Gentleman was here when the Chancellor of the Exchequer announced the £1,000 million cuts in Government expenditure last week, and he knows full well that the Government simply have not got the money to save the jobs which he and his fellow shipyard workers believe can be saved. There is considerable divergence among trade union opinion from the view that it is only the customer who can save jobs. because workers have believed the propaganda of the present Government which has been drenching Britain with the statement that nationalisation can save jobs.
      We have never heard how much it will cost to nationalise these industries or whence the money will come to run them. At a rough guess, the nearest one can get—I should be delighted if the Minister could deny it—we think that about £400 million to £500 million will be needed. Where will it come from? Last week £1,000 million was cut and next week we shall need to find £500 million. Where is all this money to be found? Is it to be borrowed, or will it come from taxation? These are the essential questions that the workers have the right to have answered.
      The House will notice that my name is missing from the supporters of New Clause 2. That is because I approach that clause and New Clause 1 with reluctance. I expect that I shall support both of them in the Lobby if there is a Division. However, the reason I support them with reluctance is that in essence they sum up the whole burden of what is nationalisation. Hundreds of people will be employed—probably, they can come from the slipways and production lines—to take up residence to hear the complaints, because the complaints will be legion.
      There is talk in the papers about 3,000 jobs possibly being saved at the Driver
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      and Vehicle Licensing Centre at Swansea, which was recently opened. That cost half as much as Concorde, but it will never get off the ground. Apparently, there are 3,000 people there who are willing and able to take on new jobs in the Civil Service. I should not be surprised to see the Driver and Vehicle Licensing Centre used as a base for complaints about these two industries.
      That may sound farcical but we should look at the contentions that will arise. Earlier we passed Government Amendment No. 1. We let it slide past—I suppose because one does not want to lead the Government too clearly forward into the future. However, the Government have left a greater mess behind them with that amendment than they had before they submitted it. We shall have no shortage of complaints.
      I want to give three examples to show how much this complaints machinery will be required. The Government have blandly stated that rotary-wing aircraft will be left out. That is marvellous. They probably all think that that means Westland Aircraft. As an aeronautical engineer I should be prepared to contend with any hon. Member or any Minister's adviser as to what a rotary-wing aircraft is. Is not the multi-rôle combat aircraft a rotary-wing aircraft? It swings its wings.
      What about the complaints that will come from the key supplier for the whole MRCA programme? Who is that key supplier? It is no one in Britain, the United States, France, West Germany or Italy. It happens to be the Soviet Union that supplies the key titanium powder for the main aircraft for the defence of Britain in the 1980s. I speak with some authority as the treasurer of the Anglo-Soviet Parliamentary Committee—when I took over we were in the red, but now we are in the blue.
      The complaints will not be from the chap down the road in one of the 296 companies concerned. They will come from foreign suppliers who will want to know the pricing policy of the British Government and the British Aerospace Corporation's instructions. Will they have preferential treatment and will they have the right to single source selection tenders? The machinery of the new clauses is vital for these two industries and for the ship repairing industry.

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      Perhaps the Boeing Aircraft Company, the MacDonnell Aircraft Company and Lockheed, perhaps even Marcel Dassault, will decide after our industry's nationalisation to come to this country and set up their own businesses to take advantage of the redundant workers who will be thrown on the scrap heap because of the nationalisation of the British aircraft industry. Will they have direct access to that machinery? They ought to have it. They will probably have a registered office in this country, which will allow them to make a complaint as they wish.
      What will the complaints be about? Looking hack at Government Amendment No. 1, which was passed earlier, once again we have skated over the question of what is the manufacture of a complete aircraft. Hon. Members know full well—all those who sat through the 58 sittings of the Committee—that no one in the world manufactures a complete aircraft. An aircraft is defined usually as being one-third airframe, one-third engines and one-third equipment. Of the one-third airframe made by the companies to be nationalised, at least half is generally bought from other suppliers; so we end up with about 16 per cent. of an aircraft being made by the companies to be nationalised. Therefore, there is no such thing as the manufacture of a complete aicraft by one company, so immediately complaints can arise.
      I do not want the House to think that I am splitting hairs. The people concerned will be up against skilled professionals looking for trouble with the British Aerospace Corporation. This complaints machinery must be there not only for shipbuilding but certainly for aviation.
      On another section of the requirement for the complaints machinery, my hon. Friend the Member for Bridgwater (Mr. King) has already referred to the equipment suppliers. It would be very interesting to see the relationship between the Ferranti Company—a nationalised company—and the British Aerospace Corporation when that corporation, in some of its component parts, will have already tried to embark on competition with, say, the Ferranti Company, let alone suppliers such as Smiths or Marconi, and let alone people such as Litton coming in from abroad.
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      Will these people be allowed to complain? Who will be assured that in making the complaint he will be properly represented? Will he have to have counsel to represent him? What is the form of representation that is acceptable to the Minister?
      7.15 p.m.
      The last particular point I make is on pricing. It is a well known fact that there are such things as loss leaders. However, what I fear about nationalised corporations is that they tend to put out products and services that are all loss leaders in order to price others out of the market. It is interesting to look at the prices quoted by many companies today in the transport industry and by the British Steel Corporation, which have to compete with others to see whether they are supplying the goods and services that they are offering at a price that means a profit or a loss. Too frequently one finds in the year's end accounts that most of them must have been supplied at a loss, or they would not end up in the deficit position that they do.
      I am afraid that there will be a lot of what is called in industry the cooking of overheads. This will entail tremendous investigations as to, for instance, whether the Ministry of Defence technical costs department will be allowed to reveal statistics to people making complaints about the overhead structure approved in companies which make up the British Aerospace Corporation.
      What about people who say "I am making an unmanned aircraft; other people call it a guided missile; therefore, it cannot be in competition with anything that you make, because you have already precluded unmanned aircraft from the Bill."? What about that kind of complaint? Will people be allowed to manufacture? Will the British Aerospace Corporation come back into the complaints machinery and enter a complaint? The corporation ought to have a right to complain about unfair competition.
      In summary, it is with reluctance that I approach the need for these two new clauses, because while we battle on with the minutiae of complaints and procedural wrangles, all that will happen is that the customers whom the hon. Member for Newton and I want to see for

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      the shipyards, production lines and factories in Britain, will have gone to the foreigners who will have got the contracts.
      Mr. W. E. Garrett: This debate and the Bill are to involve us in three long days on the Floor of the House. It is not for me to quibble too much. However, far too much time has been allocated for the Report stage. The justification for my complaints about the time has already been made clear by the way in which we are slowly proceeding through the Bill and are slowly getting involved in repetitive arguments. The Minister may have a fresher mind than many of us who served on the long Committee stage and he may have some more cheery ideas. However, I and many others have run outof ideas.
      I am not too enthusiastic about the new clause being introduced. I should have preferred to leave it to British Shipbuilders or the British Aerospace Corporation to sort out particular problems themselves. We are getting a little too rigid in our approach to complaints from wherever they come. We have tipped the balance in the other direction. As the hon. Member for Hastings (Mr. Warren) said, there is a consumer complaints council for virtually every commodity that is produced or sold by the State or is part of the State's trading agencies. By and large, they seem to work. At least, they take some of the pressure off the mailbags of Members of Parliament—not much, but a little.
      The new clause has obviously been proposed to placate some of my hon. Friends and possibly to placate some Opposition Members.
      Mr. Tom King: The hon. Gentleman has said that the matter should be left to the Corporation to sort out. It will be judge and jury on its own cause and in its own interest. How would he feel if he let the Bill go through without the clause and a company came to his constituency and employed 150 men who were doing a good job but who were a bit of an embarrassment and so the corporation took a contract as a loss leader which resulted in the firm being closed down and 150 people losing their jobs? If the trade unions came to him and asked if he could help them, he would have to say that he argued in the House
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      that such people should not have a right of redress.
      Mr. Garrett: It is clear that the hon. Member did not grasp what I was trying to say, or perhaps I did not explain myself fully. Too much rigidity is being imposed on the corporation, but that is not to say that a genuine complaint against the corporation should be ignored or pushed aside. I should like the corporation to have the opportunity of deciding its own mechanism and procedures. That would be worth a try, but if it did not work, we could come back, as we have before, with a miscellaneous provisions Bill. There is too much rigidity and the job of the corporation is being hog-tied when it should be given freedom.
      Many big commercial organisations have established procedures which, by and large, ensure that customers and employers—whether managing directors or ordinary staff—obtain a good deal in conditions of employment, and rates of pay. We should leave it like that, but it is probably too late to start on that line of thinking.
      Mr. John Prescott (Kingston upon Hull, East): My hon. Friend has said that not many hon. Members on this side of the House support the clause. As that has gone on record, and as the Government have sought not to nationalise the small Drypool shipyard on Humberside, I must put on record that the workers there fear that they may be left out when orders are placed, and they would welcome the clause.
      Mr. Garrett: There we are. That is another expression of opinion. If the Report stage lasted six days, all sorts of opinions would be expressed on this controversial clause, and there would still not be enough time.
      The clause gives the trade unions a say in pricing policy. If they believe that the pricing policy is cast too low and that that stops them from earning a higher wage, they will have a say at district, regional and national level in the pricing policy of the ships and in some of the commodities brought in for the manufacture of those ships. I can see the arguments for that, but the clause could have been left out. We could have stuck to the original Bill and let the corporation

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      get on with it instead of imposing more bureaucracy.
      Mr. Michael McNair-Wilson: I welcome the two new clauses but I have to admit to some reservations. I wonder whether the clauses are like the guarantee one has when one buys a new product which, if one makes the mistake of sending it back to the manufacturer, might lead to one losing rights rather than gaining them. What is the meaning of the sentence which reads:
      "that the complainant has a reasonable case to make in support of it, shall afford the complainant and British Shipbuilders an opportunity of making representations in relation to the matter to a person appointed by the Secretary of State."
      Does that afford the right of legal representation to the complainant or is the machinery to be set up by the Department and the corporation such that the corporation will be judge and jury in its own case? I press that on the Minister because if we pass clauses which take away rights which are probably intrinsic, we shall achieve nothing.
      I congratulate the Government on the clauses, albeit that they are tabled with the encouragement of the right hon. Member for Sunderland, North (Mr. Willey), because they are right to recognise the possibility of the corporations acting unfairly and, and more important, to recognise the value of competition between private enterprise and the State sector. That is a hopeful conversion to a view that hon. Members on this side of the House have held for many years. Hon. Members on the other side are being forced to recognise that view because they know that one of the tragedies of the State-owned industries is the difficulty of creating bench marks for success against which to measure performance.
      In the situation which we are now creating for both the shipbuilding and aircraft industries, any competition that is left will help those industries and the corporations to ensure efficiency. The Minister scarcely needs me to remind him of the effect that British Caledonian—a privately owned company—had on British Airways and the effect on British Caledonian of the shuttle service which was introduced by British Airways. By the same token, the British Airways decision to fly to Manchester, Birmingham and
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      Glasgow was one reason why British Rail recognised that they must introduce a train service to those places which was as good as, if not better than, the service offered by the airways. In consequence, Inter-City was born and that has drawn back a large number of passengers who would otherwise have used the domestic services operated by British Caledonian and British Airways. That was a good thing.
      One of the arch-exponents of such a system is the Foreign Secretary who has said that the State should set up companies in competition with private enterprise to create greater competition and thus more efficiency. The right of people to object to the practices of British Aerospace and British Shipbuilders must be to the benefit of both those corporations.
      Which of us who has arrived home before the Olympics finished on the television has not watched the competition of those superb athletes and seen each one of them exact the best that he possibly can from his performance? We have watched world records tumbling this year, and we know that this is all the result of excellence in performance. If we are to overcome some of the appalling problems that face us, we must achieve excellence in this country in all we do.
      7.30 p.m.
      One of the tragedies of the concept of State ownership, which on paper looks so attractive, is that it fails to remove the vices of human beings. One vice, alas, is that one may become inefficient and lazy. We are all subject to that vice. Fortunately, we have our constituents and the Press to probe us and keep us on the ball. But in the past when State-owned industries have been prodded hard by a particular company, they have taken action by subsuming that company within the nationalised industry. Like all monopolies and monoliths, the tendency is to destroy all that which causes discomfort. In that situation inefficiency becomes rampant. In setting up State organisations, we must not at the same time set uo a smokescreen or public relations exercise.
      My hon. Friend the Member for Hastings (Mr. Warren) and several hon. Members spoke about the need for foreign companies to set up operations

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      in the United Kingdom. We must not deny those organisations the facilities to set up enterprises in this country by loading the dice against them via State organisations. We must guard against such action in every possible way.
      What matters in our country at the present time is that we should organise the system to provide the maximum possible number of jobs. I am not so much concerned about economic structures as to provide a system in which there are enough jobs to go around. Therefore, if a foreign company wants to come into the United Kingdom, I hope that it will not be prevented from so doing. The more jobs that come to the United Kingdom the better it will be for the wealth of our nation. We need to attract all the jobs we can.
      The hon. Member for Newton (Mr. Evans) said that he had worked for Swan Hunter and he spoke of unfair competition. It that his reason for suggesting that Britain supplied only 3 per cent. of the world's shipping needs? Was he laying that at the door of unfair competition, or was he arguing that it was the other chap who was always breaking the rules?
      Mr. John Evans: I was addressing myself to a specific case rather than to the subject of the ailments in the industry. The major reason for the collapse of the British shipbuilding industry was the complete lack of investment in British industry since 1945. If the Geddes Report had not been adopted, substantial sums of money would not have been pumped into the shipbuilding industry for purposes of modernisation and the industry would have collapsed long ago.
      Mr. McNair-Wilson: I must remind the hon. Gentleman that in the last five years, apart from Harland and Wolff, a sum of £113 million of Government money has gone into the British shipbuilding industry. Last year, Harland and Wolff alone received £137 million and a further £60 million in outright grant. I am sure the hon. Gentleman is not saying that the Government put that into the industry for purposes other than investment.
      Is it not too easy to find a popular scapegoat? Is not investment the one scapegoat that everybody employs for
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      purposes of argument? Is it not often said "If only we had more investment, we could do this, that, or the other"? It is a combination of all these factors. It is a mistake to assume that there is one simple touchstone of which it can be said "If that were right, all else would be right".
      Mr. Teddy Taylor: Does not the EEC bear some responsibility?
      Mr. McNair-Wilson: I shall not follow my hon. Friend up the Common Market path because if I were to do so I am sure that I should be out of order.
      We must not have too firmly in our minds the subject of possible unfairness because that will only prevent us from achieving what we want. I appreciate that no Japanese owner is allowed to buy a ship that is not made in Japan. I see no reason why we should not have a similar approach on the part of our Government. [HON. MEMBERS: "Oh!"] I have obviously stirred up some of my hon. Friends as well as Labour Members. I am trying to say that we have not been as clever in our appraoch as we might have been.
      After all, several nationalised industries have gone abroad for their ships. If we pour money into those industries, surely we should expect them to give a few orders to our own shipping industry. It is surely not unreasonable to suggest that those industries should first buy British. It upsets me to see British policemen driving around in German motor cars or sitting astride German motor cycles. Can it truly be said that the German products are superior to British manufacture, or is it all affectation?
      Mr. Tebbit: The fact that our police may drive foreign motor cars does not put our police force ahead of foreign police forces. The fact that they drive a certain make of car may make them slower in pursuit of a criminal who may be driving another make of motor car. However, in regard to our airlines we should be concerned that we do not wreck our chances by giving too much false protection to our own manufacturing industry.
      Mr. McNair-Wilson: I do not disagree with my hon. Friend. All I am saying is that if we pour vast sums of money into nationalised industries, it is surely

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      not unreasonable for those industries to give at least a measure of protection to our own manfacturing industry, particularly in terms of shipbuilding, in which we are suffering vast over-production.
      Mr. Teddy Taylor: Does not my hon. Friend accept that even if we regarded that as a good idea which would benefit Great Britain, it would be unlawful under the Treaty of Rome?
      Mr. McNair-Wilson: Again I shall not follow my hon. Friend into EEC matters since I may offend the rules of order.
      My hon. Friend the Member for Hastings mentioned the achievements of Flight Refuelling Limited and Marshalls of Cambridge. I have had the privilege of visiting both companies and I am sure that the House is aware that Flight Refuelling has an enormous export market and is the only exponent of a remarkable device to enable refuelling to take place in the air. By the same token, Sir Arthur Marshall has built up an enviable reputation among all those involved in the aircraft industry for the way he is able to refurbish aircraft. Both these companies give us just cause to be proud.
      We do not want to see British Aerospace so monolithic and monopolistic that we shall be forced into a position in which these companies cannot continue. Were they to feel that unfair competition had been brought to bear on them, surely they should have the right, as the new clause would give them the right, to object in the strongest possible terms.
      I welcome the new clauses for the reasons I have given. I welcome them because I think that competition is a good thing. I welcome them because I think that the Government have shown that they recognise the need to maintain a private sector in these two areas which will be dominated by State companies.
      I hope that the Minister will satisfy me over the point I have raised. It would be wrong to limit the rights which must exist if we are to have fair competition. I shall support both these clauses.
      Mr. R. C. Mitchell: I welcome this new clause because I welcome competition between publicly owned industries and the private sector of industry. I see no reason why nationalised industries should have anything to fear from com-
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      petition as long as it is fair. I should have liked the clause to go a little further.
      I hope I am right in believing that when British Shipbuilders is set up, the various units inside it, such as Vosper Thorneycroft Limited will retain a separate entity and certain independence. I hope there will be some system whereby Vosper Thorneycroft can make a complaint against British Shipbuilders nationally if it thinks it has been unfairly treated. I am very much in favour of competition inside the nationalised industries. A good example of this is the British Transport Docks Board.
      One thing which I fear from the setting up of the British Shipbuilding Corporation is that the Bill may allow Ministers to try to put pressure on the corporation to do things which are not commercially correct. It is right that ships should be built where they can be built most efficiently and not where there is high unemployment, or because some particular area fits in with someone's regional policy. If the shipbuilding industry is to survive, it must be efficient, and it can be efficient only if it is not interfered with from the outside.
      This Bill has been much improved in Committee. The fears expressed to me by many of my constituents when it was first published have been very largely allayed by assurances that each individual unit inside British Shipbuilders will have its own autonomy. I hope that the Minister will reassert that tonight.
      7.45 p.m.
      Mr. Les Huckfield: I thank my hon. Friend the Member for Southampton, Itchen (Mr. Mitchell) for the genuine way in which he has expressed the concern of his constituents. I know that he feels strongly about this matter and I shall certainly take to heart what he has said and bear it in mind in future deliberations.
      I welcome the contribution of my hon. Friend the Member for Newton (Mr. Evans). In contrasting his former overalls with the costume certain hon. Gentlemen opposite have appeared in this afternoon it is obvious that he speaks with the authentic voice of the shipyards. I wish that his sentiments were echoed on the Conservative Benches.

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      This is supposed to be one of the major contentious issues of the Bill. We had a great deal of lamenting and complaining from the Opposition in Committee, and claims were made that there would be unfair trade practices. We heard a great deal about the need to shackle British Shipbuilders. In fact, we had a great deal of wailing and gnashing of teeth upstairs which has hardly been matched by the attendance on the Opposition Benches tonight. It makes me wonder just how seriously the Conservatives take this matter.
      While I urge the acceptance of New Clause 1, the Government cannot accept New Clause 2 or the Opposition amendments. Conservatives must come clean. Every time we discuss a nationalisation issue they grunt and groan, and want to shackle and nobble the new nationalised industry with all the rules and regulations they can devise to limit commercial freedom. Then, when the legislation has passed to the statute book they spend hours of their time claiming that these industries cannot make profits because there is too much ministerial interference.
      They must make up their minds about whether they want to lay down all these rules and regulations or to allow the industries a certain measure of commercial freedom. From the ambivalent attitudes expressed tonight it is obvious they have not made up their minds at all. Although the hon. Member for Bridgwater (Mr. King) says he is in favour of the new clause, his motives are entirely different from those of my right hon. Friend the Member for Sunderland, North (Mr. Willey). We welcome my right hon. Friend's contribution and his acquiescence in this clause, because his is the real concern of the shipyards and their workers. This is hardly the kind of concern which is echoed from the Tory Benches.
      I have been asked by the hon. Member for Bridgwater for more information on the definitional aspects of the new clause. The definition we have included is the same as the wording in Section 30 of the Iron and Steel Act 1967. That section was restricted to the selling of certain iron and steel products. In this clause we are talking about the sale of ships and ship repair services.
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      The hon. Member for Bridgwater talks about the procurement of materials. I am sure that he wants to go back to the 1855 Undue Preference Obligations placed on the railways. He seems to say that neither British Steel nor British Shipbuilders should be able to act commercially. But we want them to have a measure of commercial freedom and the right to negotiate with each other. Assurances were given to hon. Gentlemen in Committee and I give those assurances once more. This is the way in which we regard the activities of the two corporations.
      Hon. Members know that the situation in the aircraft industry is very different from that in the shipbuilding industry. The major aircraft manufacturers will be taken into public ownership by the Bill. Perhaps the only significant example to be excluded will be Brittan Norman, which makes light aircraft mostly assembled outside this country. The Conservatives must know that there are no other companies which would be affected which make complete fixed wing planes or guided weapons. They must recognise, therefore, that a situation exists in the aircraft industry different from that in the shipbuilding industry.
      Mr. Tebbit: Even though there seems to be no reason why Westland Aircraft could not go into fixed-wing production, and although there is no good reason why we should not encourage foreign manufacturers to come here and set up manufacturing facilities, as they will, why is it that what would be a shackle on the aircraft industry is a good thing for the shipbuilding industry? Why does the Minister not have the courage to do the same thing in both industries?
      Mr. Huckfield: From his behaviour in Standing Committee I thought that the hon. Member for Chingford (Mr. Tebbit) was learning a tiny bit about the shipbuilding industry. We have now seen that he did not. He must realise that we are dealing with totally different situations. Shortly the chairmen of both the organising committees will want to make a formal declaration of fair trading practice. I believe that covers the hon. Member's point.
      The hon. Member for Hastings (Mr. Warren) seemed to be talking as though

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      we were taking over not only aircraft manufacturers but the component firms. I do not know whether the hon. Gentleman has read the Bill. He was on the Standing Committee for a long time and he must know that the companies to be taken over are specified in the schedule. These companies will be covered by a formal declaration of fair trading practice shortly to be issued by the two chairmen.
      Mr. Warren: Will the Under-Secretary give an assurance that the declaration of fair trading practice will include a statement that in no circumstances will British Aerospace compete with any other company in the British aircraft industry?
      Mr. Huckfield: Before the hon. Gentleman intervened I said that the Conservatives wanted to shackle the nationalised industries with all kinds of obligations before they got off the ground. What the hon. Gentleman just said provides a perfect example of the shackling and nobbling of these industries that the Conservatives want, and that is why they oppose the Bill.
      My hon. Friend the Member for Newton raised a genuine fear of shipyard workers about foreign competition. My right hon. Friend the Secretary of State is also very much concerned about it and we are having continual discussions on the matter in the EEC and OECD. We shall take to heart the fears that my hon. Friend expressed. It is only fitting, right and proper that he should raise them in the debate.
      My hon. Friend the Member for Wall-send (Mr. Garrett) expressed another fear that has been put forward quite often, namely, that in introducing these provisions in the Bill we are going too far. I recognise that a number of my hon. Friends have reservations in that direction.
      When the hon. Member for Newbury (Mr. McNair-Wilson) talks about the guarantee, we envisage a situation in which the complainant would be able to be legally represented before the person appointed by the Secretary of State to consider his case. I hope, therefore, that the hon. Gentleman does not regard that as signing away anyone's rights.
      Finally, I urge the House to accept New Clause 1 and to reject New Clause 2 and
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      the Opposition amendments. I would also hope that the Conservatives would have a little more confidence in their own fair trading legislation of 1973, because a great many of the points they have been trying to make this evening will be covered by the legislation they put on the statute book. If they continue to press their amendments, they can have little optimism or confidence in their own Act.
      Mr. Tom King: Let me explain why we cannot accept the Under-Secretary's answer and why we shall be forced to press the matter to a Division. The point about the Fair Trading Act was covered in Committee. It could take up to three years for a complaint to be dealt with under that procedure, which is designed for a quite diffeernt series of matters.
      I do not understand why it is respectable for the right hon. Member for Sunderland, North (Mr. Willey) to welcome some form of fair trading provision and for that to show his high standing and moral approach but is highly disreputable and devious for us to agree with him.
      The Under-Secretary's answer was extremely disappointing because it was totally illogical. My hon. Friend the Member for Chingford (Mr. Tebbit) asked why something which is good for one corporation should be regarded as an appalling Tory shackle for the other. I was very disappointed with the speech by the right hon. Member for Sunderland, North. He said that he agreed with the principle and that it was right but that he was here to represent a shipbuilding and ship repairing constituency and that therefore he was not interested in what was happening on the aircraft side. He is a Member of this House and he is dealing with a Bill which he was appointed by the House to consider in Committee. He is a senior Member of the House and it is not enough for him to say that he is concerned only with the part of the Bill which affects his constituency.
      Mr. Willey: I am saying merely that from my experience of shipbuilding and ship repairing what is proposed is appropriate for those industries. Nothing has been put to me to show that the same situation applies to aircraft.
      Mr. King: The right hon. Gentleman recognises the principle and the probblems that can occur in any part of industry between a nationalised concern and an independent private undertaking. He says that unless evidence is shown to him that a situation exists in an industry he cannot accept that it does. I believe that he should have preserved his principles in the matter and recognised the force of the argument.
      We are under the pressure of the guillotine and therefore I urge my right hon. and hon. Friends to vote for the amendments.
      Question put and agreed to.
      Clause read a Second time.
      Amendment (b) proposed to the proposed clause:
      to leave out lines 2 and 3 and insert the words
      'one or more of the activities specified in Section 2(1) or (2) above, other than—(a) a Corporation, or'.—[Mr. Tom King.]
      Question put, That the amendment to the proposed clause be made:—
      The House divided: Ayes 294, Noes 305.
      [For Division List No. 283 see col. 601]
      Question accordingly negatived.
      It being after Eight o'clock, Mr. DEPUTY SPEAKER proceeded, pursuant to Orders [20th July and this day], to put forthwith the Question necessary for the disposal of tire Business to be concluded.
      Clause added to the Bill.

    New Clause 5

      ARBITRATION TRIBUNAL: INTERIM PAYMENTS
      'An Arbitration Tribunal shall have power to order the making of an interim payment in respect of the compensation for any securities if so requested by the relevant stockholders' representative.'—[Mr. Trotter.]
      Brought up, and read the First time.
      Mr. Neville Trotter: I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker (Mr. Oscar Murton): With this we are to take New Clause 6—Value of Subsidiary Company.
      We are also to take the following amendments:
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      No. 230, in Clause 36, page 48, leave out lines 35 to 42, and insert:
      '(6) Where after the date of transfer, a person submits a claim in writing to the Secretary of State for compensation to be paid to him under this Act, the Secretary of State shall within six months of that date make a provisional estimate of any compensation so payable and compensation stock equal in value to 90 per cent. of that amount shall forthwith be issued to, or at the direction of that person or his successor in title.
      (7) Where the amount of compensation stock issued to a person under subsection (6) above is found to be less or more than the net amount of compensation falling to be paid under section 35 above, the deficiency shall be supplied to, or the excess repaid by, that person.'.
      No. 294, in Clause 38, page 52, line 20, leave out from beginning to 'the' in line 22 and insert:
      'the arbitration tribunal, in determining the base value of the company's securities in accordance with subsection (1) above, may have regard to'.
      8.15 p.m.
      Mr. Trotter: The importance of arbitration arises because of the complexity of the compensation terms in so much of the Bill. The Secretary of State told the House when first introducing his nationalisation proposals nearly two years ago, on 31st July 1974, that there was to be fair compensation, yet we have before us provisions which are complex and which must inevitably be basically unfair, because they are based on an unsound foundation related to the value of quoted public companies when there are practically no quoted public companies being nationalised.
      Of the four aircraft companies not one is quoted. Of the 12 ship repair companies, not one is quoted. Of the five marine engine builders, not one is quoted. Of the three training companies, not one is quoted. Of the 19 shipbuilders, one, the smallest, is quoted. Out of these four industries the only one small shipbuilder is a quoted company and none of the other companies is quoted at all. We have a completely artificial basis applied to the valuation of these great industries, a basis which is bound to give rise to great difficulty and great uncertainty.
      The unfairness of the whole principle can be seen from the fact that the hypothetical Stock Exchange values upon which this is supposed to be based relate to small transfers of shares and not to the

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      takeover of a whole business. A company like Vosper Thorneycroft estimates that the compensation it might receive under these proposals could be as low as £4 million, despite the fact that its assets have a value of £12 million and its annual profit is running at a rate of £4 million.
      Who has ever heard in a fair society of a company being taken over on a basis of one year's profits. It may well be that my hon. Friends will wish to quote some examples in other parts of the country. One thinks of Yarrow (Shipbuilding) Ltd. and of Austin and Pickersgill Ltd.
      My researches show that between 1973 and 1975 in 19 typical takeovers in the City the purchasers had to pay 48 per cent. more for the businesses taken over than the quoted values of the shares at the time. Thus one can say as a generality that on a takeover it is necessary to pay a 50 per cent. increase, or half more, for control of the business being acquired.
      We have here, therefore, a hypothetical and basically unfair system which will lead to much argument and delay, and inevitably arbitration. I suggest that the arbitration provisions of the Bill are more important than have been the arbitration provisions in any previous nationalisation measure.
      There is the possibility of deductions under Section 39 for disposition of assets, onerous transactions and all sorts of other evil transactions conjured up in the mind of the Government. In this Bill the Government have given greater length than in any previous nationalisation measure to sections aimed at closing any posible loophole that their ingenious minds could foretell. I believe that they will find no such cases of attempts to escape the effects of the Act, because I believe that however much the controllers of the companies contest disapprove of nationalisation, they will not wish to break the law in this way. If any such allegations were made, however, I am sure that this would be another matter to be referred to arbitration under the procedure in the Bill.
      Again, under section 21 it is possible for the Government to allege that inter-company debts are to be treated as
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      though they were securities. The effect of that is that the parent company would lose part of its assets. If there were any intent to bring about such a situation, I am sure that that would be a matter the company would wish to refer to arbitration.
      All the way through the Bill we come across instances of the way in which this matter is being handled that will inevitably give rise to a very large number of arbitration cases. There will be much complexity and much delay. Indeed, the Minister of State himself told the Committee that
      "it is inevitable that, even with the best will in the world, it will be some time before all the settlements are reached…The negotiations will be complex."—[Official Report, Standing Committee D, 9th March 1976; c. 1600.]
      The Minister appreciated the situation. It came to light at about that time in the Committee's deliberations that the Government had appointed an eminent firm of chartered accountants to ferret through the books of these 43 companies. I shall not prolong proceedings too long tonight by repeating the very lengthy arguments we had on this subject, because for some reason the Minister of State seemed to wish to make this into a great mystery. It was not possible for us to discover what instructions had been given to this eminent firm of accountants, or what was likely to be the time-scale for the examination.
      What is clear, I believe, is that the affairs of all 43 companies to be nationalised are to be cleared by the accountants acting for the Government before there can be a final settlement. I take it that that is so, as the Minister has not corrected me. We do not know how long that will take. Obviously, the company which is the last to be dealt with by this eminent firm will have to suffer a very long delay, indeed. This is a procedure that will add considerably to the delay in the payment of the already far too low compensation.
      The shareholders, in all but one shipyard and in all the aircraft companies and all the ship repairing concerns, are parent companies. They will be wishing to continue to trade, and they will be seeking to lay their hands on the compensation so that they can invest it in other productive assets and obtain alternative occupations for the future, as well as providing jobs

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      for the future in other ways. It is true that they will receive interest from vesting day, but it is not the interest they want: it is the capital. I hardly need remind you, Mr. Deputy Speaker, of the way in which the value of the pound is continually declining. They want their money now to reinvest as soon as possible in alternative real assets.
      It is, therefore, very difficult indeed for any of these parent companies to plan. I know this from having spoken to the managements of some of the largest of these concerns. There is great uncertainty both as to the amount of compensation they will receive and as to the time-scale in which they will receive it. Certainly they all believe that they will be unfairly treated. The valuations will be on a 1973–74 basis. They could not be paid out before 1977–78. There seems to be little doubt of that. Indeed, if there is much delay in the ferreting through the books and the witch-hunting, it might well be 1979–80 before they are paid out.
      The value of the pound has fallen by over one-third since the Government came to power. We know what effect this will have on the purchasing power of the pounds that will be received in compensation. Valued on the 1973–74 basis, the sum will be worth only two thirds of its real value at the time that the nationalisation proposal effectively sterilised their businesses.
      We must take into account the fact that when the owners replace the assets taken from them by nationalisation with an alternative business, they will be faced with paying a 50 per cent. mark-up to obtain control—the 50 per cent. mark-up which the Government did not pay and out of which the Government have cheated these people. Faced with inflation—ignoring the tax problems—the owners will be lucky if they can in real terms replace their shipyards and aircraft factories with real new assets worth only a third of what they had before. Yet that is what Government spokesmen describe as fair compensation. I do not believe that it would be regarded as fair in any other Western democracy. If a foreign Government took over the assets of a British company on those terms, the company would be entitled to claim against our Government for compensation for the assets expropriated by the foreigner.
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      This is the first occasion that a Socialist Government have made an excursion into manufacturing industry. There are wide implications. The Labour Party's policy, emerging through the usual channels of the national executive and the party conference, is to spread State ownership and nationalisation to a vast area of British industry and British institutions. The unfair treatment of compensation in the Bill bodes ill for future compensation terms that may effect more and more people as the march of Socialism advances.
      It is all very well for hon. Members thinking of the next election, to say "they are not at this time the policy of the Government". If the Prime Minister was correctly quoted, however, he has argued that they are the long-term aspirations of them all. A party with those longterm aspirations and with the unfair record of this Government on compensation should never be returned to a position where it may impose its will again on this country's industry.
      New Clause 5 attempts to ameliorate the problems caused for parent companies by the delay in the payment of compensation. Its effect is to give to the arbitration tribunal power to make an award on account of the final sum.
      It is true that under the Bill the Secretary of State already has power to do that. But will the Secretary of State use his power? There can be no guarantee that he will do so. He will constantly receive reminders from the Treasury of the need to save money. We gather from recent developments that there is extreme pressure in that direction just now. There will be no sense of urgency on the part of the Minister to pay out more money under nationalisation.
      Even if he is paying out at a poor rate for the assets acquired, it is still money that must be raised. I should have thought that in view of the pressures coming from our overseas creditors and those that will come shortly from the International Monetary Fund, there would be extreme internal pressure from within the Government to hold up the payment of compensation money for as long as possible.
      There is a natural fear that the Government will be inclined to feel that the parent company whose subsidiary was

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      being nationalised would be likely to settle sooner for less, as it would fear that the longer the delay, the less the real value of the pounds it would obtain as a result of continuing inflation.
      It would be fairer to all if the arbitration tribunal, as well as the Secretary of State, had the power to provide for payment on account towards compensation. It would not be obliged to use that power. I believe that it would be fair and right for that power to be included.
      The Arbitration Act 1950 includes a provision for an arbitrator, in the normal arbitration where that Act applies, to have the power that I seek in the clause. The Government have incorporated some sections of the Arbitration Act 1950 into the Bill, but they took care not to include the section containing this power. My clause seeks to correct that omission.
      In Committee the Minister of State said:
      "I shall look into what the hon. Member for Tynemouth (Mr. Trotter) said and see what can be done."—[Official Report, Standing Committee D, 9th March 1976; c. 1621.]
      If I remember correctly the Minister said that that might take a little time. I think he said on that occasion that he might introduce a provision on Report. Nothing has been done in the meantime, despite the fact that some little time has elapsed. Despite the fact that more than 200 Government amendments have been submitted to this shabbily drafted, shabby Bill on Report, none of them covers this fair point, to which the Minister did not show himself unsympathetic in Committee.
      New Clause 6 provides that the arbitration tribunal should not regard itself as being bound by the value of the parent company of a group. With only one exception the companies being nationalised are the subsidiaries of parent companies with continuing groups. It is possible for a group to contain good parts and bad parts. It is possible for the overall quoted share value of a group as a whole to reflect so much the bad part of the group as to be less than the value of the good part which is to be nationalised. In that case an unfair figure may be arrived at, more unfair even than would normally be arrived at under the provisions of the Bill. New Clause 6 seeks to remedy that defect by providing
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      that the arbitration tribunal shall not be bound by the value of the parent company's shares in the calculations.
      A classic example is Sunderland Shipbuilders Ltd. On 1st July 1974 the Secretary of State announced the terms on which Sunderland Shipbuilders was being purchased from the bankrupt Court Line, which was in the hands of the receiver. From time to time I act as receiver and I know that receivers are not in the strongest positions when it comes to the sale of assets. In that case there was not a strong argument for paying an inflated price, and yet the price paid was £16 million.
      On the basis of the Bill it would have been possible in that case for the arbitration tribunal to rule that the value of the assets should be taken as nil, because by that time the value of the parent company's shares was most certainly nil. I cannot help reflecting what a pity it is that the basis which the then Secretary of State thought was fair for the nationalisation and acquisition of Sunderland Shipbuilders does not apply to other companies which are being taken into State ownership under the Bill.
      I wonder by how many times the ultimate compensation that will be received by Austin and Pickersgill Ltd. would have been increased had the same terms been applied as were applied to the company's neighbours on the other side of the river. Austin and Pickersgill is a much more sophisticated and productive yard than was Sunderland Shipbuilders at that time, yet Austin and Pickersgill will obtain only a fraction of the compensation that was paid to Sunderland Shipbuilders, whose parent company was bust.
      I believe that New Clause 6 will help to bring some justice into a very unfair method of compensation as provided in the Bill as it stands.
      8.30 p.m.
      Mr. John Cope: I should like to amplify what has been said by my hon. Friend the Member for Tynemouth (Mr. Trotter).
      The hon. Member for Bristol, North-West (Mr. Thomas) who, unfortunately, has just gone out of the Chamber, said earlier that in Committee we spent most of our time talking about compensation and related provisions. That is rubbish,

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      as will be seen from the record. Half the clauses in the Bill are concerned with compensation, arbitration and related provisions such as safeguarding. It would not, therefore, have been surprising if we had spoken for half the time on compensation-related matters, which are some of the most important and complex provisions in the Bill.
      New Clauses 5 and 6 help to alleviate a grossly unfair position in respect of compensation. They do not go as far as we would like, nor as far as we propose in Committee, but they go some way towards alleviating that grossly unfair position.
      It is important to make clear why we believe that the position is so unfair in general terms. It is grossly unfair to the shareholders of the companies concerned. The hon. Member for Nelson and Colne (Mr. Hoyle) earlier tried to make out that Vickers was virtually owned and financed by Lord Robens personally. That is absolute rubbish. The vast majority of the shareholders in Vickers, as in other holding companies affected by the Bill, are institutional shareholders, such as life assurance and pension funds which own the shares through their insurance societies.
      It is a matter not of argument but of record that there are more people in this country with life assurance policies and, therefore, with an interest in shares, than there are members of unions affiliated to the TUC. The facts are fully documented in Lord Diamond's Report.
      These Government securities, with one exception, will not go to individual shareholders, whether they be institutional investors or individuals. They will for the most part go to the parent companies which bear some of the great names in British industry. Those companies will use the money that is left over—the one-third, as my hon. Friend suggested, and I do not think that he is far out—to reinvest in British industry. I have no doubt that they will use the money better than the Government would use it if they retained it.
      The compensation provisions seem to me and my hon. Friends to be based on a ridiculous set of assumptions. That contention is supported by articles in various newspapers which were quoted at length in Committee. The amendments go some
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      way to correct the compensation provisions but, even so, there will still be an almost Alice-in-Wonderland method of arriving at the value of the unquoted shares.
      The first thing that has to be done is to pretend that these shares, virtually all unquoted, are in fact quoted. Then we have to pretend that they were quoted in 1973–74 and wonder what a pretend investor would have paid for the pretend shares on the basis of information which the companies might have disclosed had they been quoted and the dividends they might have paid had they been quoted at that time. But the information which actually was disclosed by these companies in 1973–74 is not necessarily at all the same as would have been disclosed if they had been quoted, and the dividends which were paid to parent companies are again not at all necessarily the same. Indeed, they are certain to differ from the dividends which would have been paid had those companies been quoted at that time.
      Therefore, one has to use this pile of guesses and pretence to start arriving at a figure of compensation. Even though one may be making these guesses and doing these calculations today, it will in fact be done in a year or two's time, and one has to speculate what the investor would have thought the performance of an individual company was to be in 1974, 1975 and 1976, and maybe 1977 and 1978, by the time this sum comes to be done. One is not allowed to look at the actual performance of the companies concerned. An amendment to allow this to be done was specifically voted down by the Government. One has to guess what a pretend investor would have thought the performance was to be in those years.
      Once one has guessed what the performance might have been, one has to look at the parent companies' own quoted price and to adjust one's pile of guesses in accordance with how one thinks it might be affected by the actual quoted price of the parent companies at that time. This question of the parent companies' quoted price is important and is the subject of New Clause 6. It was specifically mentioned in the Bill—the one factor which is mentioned. The Minister of State or his colleague went to some trouble to

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      tell us in the discussion on another amendment in Committee that any factor which was specifically mentioned as having been taken into account by the arbitration tribunal would override any others in importance. So this parent companies' quotation is of fundamental, indeed overriding, importance in arriving at the valuation. This, of course, affects the pile of guesses and it is a nonsense, as my hon. Friend the Member for Tynemouth has pointed out.
      But even when we have made this set of guesses we have to wait—and they will already have waited for two or three years —until vesting day. We have then to pretend that Government securities were issued at that stage. and there will certainly be arguments, in all probability for a year or two, over this heap of guesses and pretence. At the end, the compensation in the form of Government securities is paid to the parent companies.
      After all that, when the Secretary of State has finished and has paid out the money, the Financial Secretary to the Treasury comes with the new tax which he has introduced, in the Finance Bill, to take back a large section of the compensation, subject to a lot of complicated provisions which we discussed in connection with the Finance Bill the other day. My hon. Friend was quite right to point out that the compensation, such as it is, if arrived at on this basis is strictly on the basis of individual shares and small parcels of shares, whereas in fact the Government are buying and the parent companies are selling not small parcels of shares but control of these companies. It is a fact of life that control is more valuable than the sum of the parts and the individual shares which make it up. That fact is recognised by the Government, not only in the case quoted by my hon. Friend but in the case of Felixstowe Docks where the Government paid 60 per cent. over the share price for control—but in this Bill they are paying nothing for it.
      This way of proceeding is hopelessly contrary to both the spirit and the letter of the Takeover Code. The terms of compensation would be regarded by the Export Credits Guarantee Department as expropriation if they were applied to British assets by a foreign Government. There was considerable discussion of this
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      matter in Committee, but the Government were unable satisfactorily to argue that the ECGB would not regard the terms as expropriation.
      I hope that the Minister will deal with a point left outstanding in the long Committee discussions. The Government declined to say whether they would allow the international arbitration machinery attached to the World Bank to arbitrate on these terms if a foreigner owned shares and used his right to go to the international centre for the settlement of disputes of this kind.
      The international centre has the power to arbitrate only if the Government, as the party paying the compensation agree. The Government should say tonight that they will allow the centre to arbitrate if a foreign national wants to go to the panel.
      The damage done by the compensation terms and the way in which they have been drawn is not limited to parent companies, individual shareholders of quoted companies or shareholders of parent companies. It extends to all companies threatened by nationalisation. As soon as there is the threat of nationalisation, even from such a distinguished body as the Labour Party Home Policy Committee, the industry concerned is immediately affected with a sort of nationalisation blight. These terms and the shabby way in which they have been prepared increase the blight on any threatened industry. Any company which is threatened must look even more carefully at how it invests in its activities. As a result of the compensation terms imposed in the Bill, that applies as long as the terms remain unaltered, even if the Bill is defeated.
      These companies should be valued as. other companies are valued when they are bought and sold by the Government or in the private sector. The amendments do not go all the way to achieving this aim, but they go some way and should commend themselves to the House.
      8.45 p.m.
      Miss Harvie Anderson: I am glad that the hon. Member for Glasgow, Garscadden (Mr. Small) is back in the Chamber. He said earlier that another company on the Clyde shared the view of Bristol Channel Ship.

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      Repairers Limited on this Bill. Unfortunately, the hon. Member did not mention the reasoning behind this attitude—and that is at the heart of what we are discussing. The reason companies wish to be left out of the Bill is that when they are prosperous and when the workers have job security, no one in the firm willingly wants to make the future uncertain. This is a particularly important factor for the Clyde firm because it has already been absorbed into a large amalgam of shipbuilding companies. It has actually experienced what we are now proposing to do to this company for the second time. The result was devastating on the employees of that company and on its profitability.
      The Minister of State knows very well, and I have said repeatedly, that he will regret the day that this company is taken into public ownership through nationalisation, because there will be the same sorry story to tell a few years after the implementation of the Bill if, indeed, it ever gets on to the statute book.
      In respect of that company one ought to record the fact that following its re-emergence from the amalgam in 1971, its turnover increased from £12½ million in 1971 to £27 million in 1974. Profits turned round from a f2i million loss in 1970 to a modest pretax profit of £300,000 in 1971 and £7 million in 1974. A particularly important fact, at a time when there are 165,000 unemployed in Scotland, is that the numbers employed rose from 3,500 in 1971 to 4,500 in 1974, and continue to grow.
      It seems to me that it is for a very good reason that the company does not want to be drawn within the terms of the Bill. Its performance now, and its performance for the successive years, is the point on which the compensation should be judged. The great tragedy is that the compensation figures proposed are so unfair that it will be quite impossible for the parent company to get sufficient money to reinvest in order to provide the additional jobs which are so badly required.
      The hon. Member for Bristol, North-West (Mr. Thomas) made reference to the compensation clauses on the assumption that many of us on the Conservative side of the House were primarily concerned that the shareholders should get back some money. Most certainly we are concerned that those who take the invest-
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      ment risk—a risk it is, as I know well from my own experience of the shipbuilding industry—should be adequately reimbursed. Unless that compensation is paid they will not be adequately reimbursed and there will not be the job opportunity created which ought to arise from adequate compensation.
      In passing, it is interesting to note that out of some 3,000 columns of recorded debate in Committee, the compensation clauses took about 380 columns. That does not seem to me an undue amount when we consider the importance of the subject. Arbitration accounted for a further 300 columns. That does not seem an unduly high proportion, although it is quite right that consideration is spread in other ways.
      We have had an interesting comment in respect of the dogma of nationalisation. All those who support the Government think that compensation is simply for the benefit of the shareholders. What they are believed to do with it goodness knows, but it must be remembered that people who invest once tend to do so again. That is a thought that many people are only too happy to overlook at the present time. The hon. Member for Bristol, North-West, and other hon. Gentlemen opposite, totally failed to relate nationalisation to jobs. But until we relate it to jobs, we do not get to the heart of this whole matter. Some certainly do not begin to understand the degree of opposition which many of us feel about this Bill on the grounds of employment alone.
      The hon. Member also referred to the new dimension which would develop when worker participation entered this area. I was reminded—perhaps only a few of us here tonight are old enough to remember this with clarity—of the little notice which went up on every coal pit on nationalisation in 1949:
      "This pit belongs to the people"—
      great day. Wonders were going to happen. I do not see a single notice of that order left standing today. Nor do I see great successes for the job prospects which were then offered in the mining industry. About 23,000 jobs have been lost in that industry. I am therefore much less sanguine than is the hon. Member.
      Mr. Burden: I do not know whether my right hon. Friend was present when the Prime Minister, referring to the Bill

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      in answer to a question of mine, said that there would have to be rationalisation after the Government had taken the industry over. Rationalisation undoubtedly means closures or cuts in some areas.
      Miss Harvie Anderson: I am grateful to my hon. Friend for re-emphasising this point, on which we feel so strongly. There can be little doubt in the mind of anyone who faces reality that there will be redundancies. With the present unemployment rate, this is a tragedy which, above all else, we should seek to avert. When compensation is considered, it must be in terms of reinvestment. The parent company must therefore get sufficient reinvestment to make new jobs.
      Two other matters are particularly important in connection with compensation. It is difficult, because we know that he is not a stupid fellow, to make the Minister of State confess that the recent cuts have had an additional and devastating effect on industry, which makes anything. If one introduces what is in fact a payroll tax on industry, one still further reduces the resources with which employment can be created and developed. It is important to add to the difficulties which limited compensation brings the difficulties which will be found in the spring of the coming year when this additional payroll tax has to be found.
      The other important matter is the effect on the management of these companies. Successful companies are successful largely because of the leadership and capability of the management. It is true that in many cases management has considerable investment in these companies. it is equally true, I should have thought, that the Government and the new shipbuilding board would wish to use the expertise of that management. This again is something that I am afraid that I have said before in Committee, but if the expertise is required it seems unlikely that it will be willing to continue if the compensation received for its investment—in every sense—is to be as unfair as most of us judge it will be.
      The compensation, because of the dates on which it is to be based and the way in which it is to be calculated, is grossly unfair. But added to that is the
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      long delay emphasised by my hon. Friend the Member for Tynemouth (Mr. Trotter). The new clauses seek to alleviate the delays and the void which will occur while the compensation is being argued. It would not be appropriate to go into detail on how the compensation will be calculated. However, it is well known by all who served on the Committee and by many throughout industry that a Herculean task has been imposed upon one professional firm which, in the view of many, could not possibly fulfil that task within an acceptable number of years.
      First, we have the bad judgment of accepting compensation based on a limited period, the results of which are known to be less good than they became later. We then have the appalling fall in the value of our currency in the intervening period, to which must be added the delay which will be occasioned by the proposed arbitration procedure. There-fort, if we can do anything at this late stage to improve upon a Bill, which I still sincerely hope will not become law, we must support the new clauses. We are seeking to ensure employment where it already exists and to offer some hope of being able to extend that employment. Therefore, I support the new clauses.
      Mr. John Evans: I listened with interest to the right hon. Member for Renfrewshire, East (Miss Harvie Anderson). The right hon. Lady suggested that nationalised industries are to be equated with redundancies and rationalisation. I wonder whether the Opposition will ever understand that that is why Labour Members have constantly argued that the State should take over not only bankrupt, rundown industries in declining regions but profitable sectors of British industry to prove conclusively that, given an even chance, the nationalised industries can be better run and made more efficient and prosperous than industries in the private sector. Until a Government accept that premise, we shall not be in a position to point to the parallel. Unfortunately, we have to work on the assumption that the Government's duty is to take over rundown industries.
      The right hon. Lady referred to the rundown in the mining industry. The

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      overwhelming reason for the rundown of that industry was that the pits ran out of coal. Was the right hon. Lady suggesting that the miners should have been allowed to dig stones instead of coal? There was a savage rundown in many areas, such as that in which I was brought up, not because of nationalisation but because the pits ran out of coal.
      Miss Harvie Anderson: I think that the hon. Gentleman may have missed the point of my argument because I did not name the firm whose fate I described. Yarrow (Shipbuilders) Limited on the Clyde is one of the most profitable private enterprise shipyards in the country. That company was brought to near total destruction when it was dragged into a consortium of similar pattern to that into which it will again be dragged through nationalisation.
      9.0 p.m.
      Mr. Evans: I accept the point that the right hon. Lady has made. Perhaps she missed what I said in the last debate. I pointed out that I had worked in the industry since I was 15 years of age and that I knew something about the industry in which I worked.
      The major reason why Yarrows has been one of the most prosperous and successful firms in the shipbuilding industry is that it exists almost entirely out of Government orders. On Tyneside, where I worked all my life, we often pointed to Yarrows and other yards and asked why the Tyne yards could not have their fair share of shipbuilding orders, which were always placed in areas of unemployment. I shall not repeat such matters tonight.
      This is a classical case of the Tory Party at its best or worst, depending on where one stands politically. Once again the Tories are arguing the case of the privileged shareholders. Once again they are weeping crocodile tears on behalf of these privileged people. Once again they are suggesting that a Labour Government are taking industries without paying the proper compensation.
      After giving most of my life to the industry and working with men and women who have given most of their lives to the industry, I believe that it should be confiscated and there not be one penny of compensation. I should
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      like the Minister, in his reply, to outline to the House every penny that shipbuilding companies in Great Britain have received in the past 25 years in Government grants, regional employment premia, and policies to aid employment. If we put that on the other side of the balance sheet, we end up with their having to pay the State money for the State to take them over. They owe the taxpayers a great deal more than we owe them. That is true of the shipbuilding industry.
      It could be argued that the ship repairing industry is in a somewhat different position. Many of the ship repairing firms are tied up with and part of shipbuilding concerns. There are many instances—certainly Swan Hunter, where I worked for many years—where the repairing side is tied hand in glove with the building side. Part of the reason for the prosperity of the repairing side was that it was able to transfer workers into the repairing section as and when necessary, when ships came into the Tyne. Unfortunately, in the past few months this has not happened often enough.
      It is essential that the Government give us this balance sheet. It is essential that we find out exactly how much each company has received in the various grants that have been available over the past 25 years. It is no secret that I believe that one of the issues which has devastated the British shipbuilding industry is not the amount of capital investment in the industry but the lack of capital investment in the industry.
      In many of the yards in which I worked, we were working with cranes and equipment which were put in during the last war, when they were also put in with Government money to build warships for the Government. Very few yards throughout Britain have had private investment. What little investment there has been has come from the taxpayer. Successive Governments have poured millions of pounds into the industry.
      The right hon. Lady referred to the last reorganisation of the industry. When we look at what happened there, in the Geddes Report there was a total, complete and utter condemnation of the management of British shipbuilding. The

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      Government of the day made it clear—and the industry accepted this—that they would have to amalgamate if they were to survive. Some of us at that time—I was not then a Member of Parliament—were arguing that that would not succeed and that the only hope for the future of the industry was for it to be taken into complete public ownership. After many years have elapsed and hundreds of millions of pounds of taxpayers' money has been poured down the drain, finally we have reached that stage at which we shall take the industry into public ownership.
      Turning to the question of rationalisation, given the world order book as it exists today and the rundown situation of British shipyards, the lack of modern equipment, and the lack of the ability to compete on an international plane, undoubtedly there will be redundancies on a large scale. One thing that I expect from the Government, certainly the present Labour Government, is for them to be at least humane in their approach, and far more humane than the attitudes that existed throughout the shipbuilding and ship repairing industries for many years until the comparatively recent past, in the days when we were given 24 hours' notice of the termination of a job and spent perhaps six or seven weeks tramping Tyneside looking for another one, constantly being rejected. The workers in the industry supported the Labour Party in two General Elections in 1974 because they wanted this industry taken into public ownership.
      As regards compensation, we must put into the balance sheet the people who have given their lives or their limbs in the industry. Many have been crippled with arthritis and many have been deafened by the noise in the shipbuilding industry. They also have a right to be considered. When I hear Tory Members talking about the rights of shareholders, I must speak on behalf of the workers in the industry. If the Government draw up the balance sheet properly and tell the public exactly how much public money has been poured into the industry, we shall be able to see who owes what to whom.
      Mr. Burden: I was extremely interested in the passionate way in which the hon.
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      Member for Newton (Mr. Evans) spoke. I was also very interested when he said that he had served in many shipyards. It seems rather surprising that a man should serve in many shipyards. I am sure that the House would be interested to know in just how many shipyards he has been employed.
      Mr. John Evans: I do not know whether I shall be boring the House, but if I start on Tyneside and work my way through Wearside and Teesside, will that satisfy the hon. Gentleman? Will it satisfy him when I say that in one year, 1958-59, I worked in no fewer than seven shipyards and repair yards? Some of my comrades on Tyneside often worked in 14 or 15 different yards in one year. We were lucky if we got two or three weeks' work at a time. That is how many yards I have worked in.
      Mr. Burden: I find it surprising that anyone who has worked in as many as seven shipyards in one year can know very much about any of them.
      It surprises me that the Labour Party and the Government say, on the one hand, that we must have a thriving mixed economy, when, on the other hand, hon. Members such as the hon. Member for Newton and many other Labour Members make it perfectly clear that they want nothing of the sort. They want a purely Socialist economy and the complete elimination of capitalism. The Government have created a situation in which, despite their lip service to the need for a thriving mixed economy, they are looking out for something else and are now in the process of nationalising the shipbuilding and aircraft industries.
      This threat has been hanging over the industries for a very considerable time. Because of this threat, with all the uncertainties that it has created, there is a full-out effect upon other industries. Particularly is this so when it appears that there is unjust compensation that comes very near confiscation, which Labour Members below the Gangway have suggested should be the Government's action.
      One does not have to think very deeply before understanding the effect that this has on a whole range of private industry. Why should industries consider investment at current rates when a Government might come along and take them

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      over, and then, as in one case—only one of these companies was quoted—on a notional valuation three years old, compensating on that basis? This is confiscation rather than compensation. It is a monstrous injustice.
      The best way in which I can illustrate the monstrosity of the injustice is by referring to a Question tabled by my hon. Friend the Member for Norfolk, North (Mr. Howell) who asked:
      "what was the percentage rise in the general level of prices of (a) each nationalised industry and (b) of all nationalised industries together between 31st March 1975 and 31st March 1976."
      The Financial Secretary to the Treasury stated that the rise in the price of domestic coal was 22 per cent. in that year and that industrial coal rose by 15 per cent. He said that electricity prices in England and Wales rose by 33 per cent., British Gas Corporation prices by 20 per cent., telecommunications by 80 per cent., posts by 22 per cent., British Airways Board prices by 20 per cent., British Rail passenger fares by 48 per cent., freight by 29 per cent., parcels by 27 per cent., British Transport Docks Board uncontrolled charges by 72 per cent. and its controlled charges by 56 per cent., British Waterways Board charges by 27 per cent., and National Bus Company fares by 40 per cent.
      The Financial Secretary added:
      "The retail prices index for goods and services mainly produced by the nationalised industries rose by 33 per cent. between April 1975 and April 1976."
      He concluded:
      "It is not possible to give a single overall figure. The average list prices of BSC's main product groups increased within the range of 0–27 per cent."—[Official Report, 23rd July 1976; Vol. 915, c. 620.]
      That illustrates more clearly than anything that I can say that this is confiscation rather than compensation.
      Mr. E. Fernyhough: I find it remarkable that the hon. Member for Gillingham (Mr. Burden) should read out a list of prices relating only to nationalised industries. It was, for instance, noticeable that he did not include land in the price increases that have occurred over the last few years. Millions of pounds more have been made out of land in the last five years than have been made by industry. Millions
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      have been made by racketeers and property dealers. Everybody knows how property prices have increased, and yet the hon. Member did not include the prices of land and buildings which have risen most. By and large land and buildings are still in the hands of private enterprise.
      I have been present when every major nationalisation measure, since the war has been introduced. I have listened to the same heartfelt pleas in behalf of the shareholders by Conservative hon. Members in relation to Bills to nationalise coal, railways, the steel industry, Cable and Wireless. They made the case that they have made tonight on behalf of those who hold shares in the shipbuilding, aircraft and ship repairing industries.
      Mr. Burden: These figures affect the value of an industry being taken over. These are the rises in costs in one year —and they are official figures issued by the Labour Government, not my figures.
      9.15 p.m.
      Mr. Fernyhough: I am not disputing the figures. I am merely saying that those increases are nothing like as large as the increases in land prices. Industry cannot function without land. Without that commodity one cannot build a single factory or a shipyard. The hon. Member for Gillingham failed to mention that the largest increase we have seen in postwar years has occurred in land prices and the costs of housing and other buildings.
      Mr. Burden: Rubbish.
      Mr. Kaufman: The House might like to know that in the period of office of the Conservative Party the price of private houses rose by 119 per cent.
      Mr. Fernyhough: I repeat that I have listened to every debate on nationalisation in post-war years and heard all the pleas by Conservatives when seeking compensation in respect of the owners of coal, railways, Cable and Wireless and other industries. However, when the Conservatives were in power between 1951 and 1964 they did nothing to rectify the wrongs which they contended we had committed between 1945 and 1951. They did not take a single step to put right what they called our confiscatory measures. When the Conservative Government sought to deal with Rolls-Royce,

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      they did not shed many tears for those shareholders. For once they had to put Britain's interests between their own party's selfish interests.
      The right hon. Member for Renfrew-shire, East (Miss Harvie Anderson) drew attention to the situation in shipbuilding and ship repairing. There was a ship repair yard in my constituency which was profitable and which belonged to Vickers. In 1970 we decided to keep it open. But three months afterwards, when the electorate decided to return a Conservative Government, the right hon. Member for Knutsford (Mr. Davies) decided to close the yard. We were intent on keeping the Vickers yard open, but the then Tory Government closed it.
      The right hon. Lady talks about jobs being lost through nationalisation, but we have experienced job losses as a consequence of the Conservatives not being prepared to use the very Act they introduced—the Industry Act 1972. The ship repair yard in my constituency could have been saved by their legislation, but they let go 750 jobs in my constituency because they would not use the Act.
      Mr. John Evans: Would my right hon. Friend confirm that when this repair yard closed, 750 men lost their jobs, but when the yard was at the peak of production about 2,000 men were working in it?
      Mr. Fernvhough: I accept that, but there were 750 employed when the Conservatives made their wonderful statement about no help for lame ducks. The lame duck in my constituency was the first to be crushed by their lack of charity and understanding.
      Mr. Heseltine: I am not sure where this argument is leading. Would the right hon. Member explain the difference between the repair yard in his constituency and the Greenwells yard, which has just been closed by the nationalised company which owns it?
      Mr. Fernyhough: I am not saying that there is any difference, but the right hon. Member for Renfrewshire, East said that nationalisation meant closure. All I am saying is that there have been closures by private enterprise all through my lifetime.
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      The yard in my constituency was closed not because it was not viable but because Vickers decided to get out of heavy industry. If it was not viable then, Swan Hunter Shipbuilders has found it to be viable since, because when that company took over it made the yard a going concern, and Swan Hunter is not that much more efficient. [Interruption.] If hon. Members opposite wish to interrupt me, would they do so one at a time? At my age I cannot cope with hon. Members all shouting at once.
      Mr. Heseltine: What exactly is the right hon. Member complaining about? Is he complaining that his yard was closed by private enterprise Vickers, or is he complaining because it was rescued by private enterprise Swan Hunter?
      Mr. Fernyhough: It was closed by a private enterprise firm which would not have existed without Government orders. Vickers at Barrow lives on Government orders. If it lost Government orders for naval vessels, Vickers would collapse.
      Mr. Burden: Would not the right hon. Member agree that the only way shipyards can be kept open is by giving them ships to build or repair? If yards are not competitive in the world and cannot build ships in competition with other countries, the only alternative is for the Government to order ships. Are the Government going to order shins? If so, what are they going to do with them?
      Mr. Fernyhough: If the hon. Member wants to know what the Government are going to do, he will have to wait until they announce their plans. They will do so when they get their legislation through. Opposition Members would complain if the Government took powers unto themselves which the House had not yet given them. When the Government get this Bill through, they will take steps to make the industry much more efficient and viable.
      One of the enterprises to which I can point is Thomas Cook Ltd. That was a thriving industry while it was nationalised. It had not made a loss since it was taken into public ownership in 1947. But what happened under private enterprise? The company's record under private enterprise does not compare with its record when it was nationalised. Another example, is the

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      Carlisle brewery and its pubs. That is a fine example of private enterprise expanding and sustaining jobs!
      Our debate has witnessed the usual crocodile tears by the Conservatives on behalf of shareholders, the tears we have seen over every nationalisation Bill since I came into this House, and that is a long time ago. The Conservatives could put to the men in the yards on the Tyne, the Clyde and the Mersey the arguments they have put to Bristol Channel Ship Repairers, but they would not get the same answer. I am satisfied that the overwhelming majority of labourers and craftsmen, technicians and designers in the shipbuilding and ship repairing industries are anxious for those industries to be taken into public ownership. Many of the top management would be dismayed if the Bill did not get through.
      The Conservatives are making their usual last stand on behalf of the shareholders. It is a stand similar to those that they have made on every major nationalisation Bill over the last 30 years. It will not stop the Bill going through. If they should ever happen to get back to power, which God forbid, they will no more denationalise these industries or turn the clock back than they have with regard to the railways, Cable and Wireless, the coal mines and many other industries, and they know it.
      Mr. Teddy Taylor: I hope that my hon. Friend the Member for Henley (Mr. Heseltine) will immediately deny the suggestion by the right hon. Member for Jarrow (Mr. Ferneyhough) that the Conservatives will retain these industries in public ownership. I hope that he will say that we shall want to review the whole situation in the light of circumstances then prevailing. There can be no suggestion that the Conservatives will not denationalise. I hope that we shall and that we shall do a lot of it in the interests of the country.
      The right hon. Member for Jarrow confused the issue by bringing in the question of the State pubs. They are not normal pubs. They are on the Scottish border and they are subject to a different situation from other pubs. The pubs in England are open on Sundays, but Scottish pubs are not. Because the State pubs in Carlisle are on the border, Scotsmen who are ill judged enough to want to
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      drink on a Sunday have to cross over. The accounts of these pubs are distorted because of the peculiar circumstances. If the right hon. Gentleman cares to stay in the House later this evening he will see whether the present happy situation in Scotland remains.
      The clause does not relate directly to compensation. It simply says that if compensation is to be paid, the owners of the yards should have a reasonable guarantee that they will get some of their money within a reasonable period of time. The points advanced by my hon. Friend the Member for Tynemouth (Mr. Trotter) are relevant in this regard. The Minister commented on the points raised by the hon. Member for Newton (Mr. Evans) concerning State money put into the shipbuilding industry. If the Minister is honest he will try to differentiate betweeen the money going to State-owned of partially State-owned firms and the money going to the private sector of the industry. If he does that it will be clear to the hon. Member for Newton that by far the greater part of the State cash which has gone into the shipyards by way of loans or grants has been paid to the nationalised side of the industry.
      The hon. Member for Newton, with his long experience of working in shipyards, seemed to believe that nationalisation would improve matters. I am sure he believes it. However, I think he will accept that there are some Opposition Members who, like myself, have experience of working in shipyards. We take the view that the Bill will make things worse.
      9.30 p.m.
      Surely there is an ideal situation in the shipbuilding industry to test these matters. That is because half the industry is nationalised and half is not. Surely it would be sensible to let the two fight it out to see which part of the industry emerged the stronger and more viable. On the Clyde the exercise has been carried out to some small degree. The integration of Yarrows was tried within a nationalised firm and it almost went bust.
      Mr. John Evans: Does the hon. Gentleman accept that the comparisons he is drawing with firms such as Vickers and Yarrows are not fair? Vosper has subsisted for years as it has been able to build Government warships and Ministry

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      of Defence ships. The other yards have had great difficulty in getting such orders. Any fool in the industry knows that if a yard has contracts from Governments to build warships, supply ships or ammunition ships, it is on to a good thing as they are contracts that will make a fat profit. However the yards that have to try to get orders elsewhere, especially on fixed contract prices, run into difficulties. Many of those difficulties are due to rank bad management.
      Mr. Taylor: I can assure the hon. Gentleman that to have Government work is no guarantee of making a profit. Let us remember the experience of the Fairfield yard. That company built many naval vessels, but although it had those contracts it not only failed to make money but went bust. It is nonsense to say that under the present tight arrangements for negotiating Government contracts there is a guarantee of profit.
      I hope that the hon. Gentleman will accept that he is being unfair to Vosper. The majority of its work does not stern from Government contracts. As he will be aware if he has studied the accounts and looked at the order book, the majority of its work comes from obtaining naval orders from foreign countries. That means that it has to engage in competition with other companies. That is not an easy market.
      Mr. John Evans: I did not refer to the British Government. I said "Governments". I was careful about that because the point was raised with me in a private debate.
      Mr. Taylor: If poor old Vosper has to look for work from foreign Governments in competition with others and with restrictions placed on it by this Government, which limit the countries for which it can build ships and which leave us out of a large market, and if it has to do so at a time when there is a shortage of shipbuilding orders, it shows that it must be a pretty efficient undertaking if it can survive in that climate.
      We could argue about these matters until the cows come home. I am sure that the hon. Gentleman thinks that matters will improve with nationalisation, whereas I think the situation will become worse. As I have said, we have
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      a grand opportunity of testing that to a conclusion. That could be done if we had fair competition between the private sector and the State-owned sector. I hope that the Minister will make it clear just how much State cash has gone to the nationalised sector by comparison with the private sector.
      We are talking about the need to have a fair settlement of compensation as speedily as possible. The Minister of State may well point out that under Clause 36(6) he can, if he so desires, agree to the making of interim payments of compensation. That depends on the Minister. I appreciate that he considers himself to be an important member of the Government, but he is subject to Treasury control in these matters. In present circumstances, in which the Chancellor is having to borrow £9,000 million and to issue Government stock, how is he to respond to the Minister if he knocks at the Treasury door saying "Please, may I issue £100 million of Government stock tomorrow to those who own the shipyards as I want to make an interim payment to them?" How can that happen when in my constituency we cannot even get borrowing consent for the conversion of some houses for a social work department for the largest housing scheme in Europe because the Government cannot allow the issuing of any more money? It is clear that it will not be easy to make an interim payment. The Minister might find that to be difficult.
      There is no guarantee that interim payments will be made at a reasonable time. That would not be so had if the compensation were excessive, but I think it is generally accepted by all reasonable people that while compensation in respect of some firms is not wholly unreasonable, in the case of other firms it is sharp-dealing robbery, nothing more and nothing less.
      When we look at some of the firms and their balance sheets, it is clear that the Government are, in some cases, buying a large mountain of cash, which is almost equivalent to the full compensation price. We have also to look at the fact that the positions of some of the firms have deteriorated to some degree since it was first decided to nationalise. Much of that deterioration is due to the threat of nationalisation, which has made

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      it difficult for them to plan and to borrow, and almost imposible to invest.
      The Minister should not discount the fact that, in the repeated remarks he has made throughout our Committee stage and since then, he has brought about a position in which a number of firms are on the point of collapse. He was always very careful never to specify them. He once went as far as to make the monstrous suggestion that a firm on Clydeside was in danger of collapse. He must know that this is not the case, but general smears of this kind about the state of the industry, as he must know, do a great deal of damage to firms which are trying to provide security of employment.
      In all these circumstances, the least we are entitled to instead is that the Government will make some arrangement that some of this money will be paid at a reasonable time. There is no guarantee at present. All we have is the suggestion, in Clause 36(6), that the Minister may agree to an interim payment if he so desires. That is not good enough. In the new clause we suggest that the arbitration tribunal shall have the power to make an interim payment in respect of compensation. If we do not have this it may be several years before these matters can be sorted out.
      In the acute state of the Government's finances and in the acute state of the economy, with so much unemployment and so much more about to be created, we are certainly not in a position where there is any incentive for the Government to pay out money quickly.
      There has been yet another indication of the crisis only today. We have seen on the tape that there is a plan to get rid of 65,000 civil servants. This is a drastic step for a Government to take when we have 165,000 unemployed in Scotland alone—the highest figure post-War. In these circumstances, will it be easy for any Minister, even if he wants to do so, to say that he will make an interim payment?
      Unlike the hon. Member for Newton, I believe that it is utter madness to spend this money on nationalisation at a time when we need the money so desperately in other fields. On the other hand, if there is to be nationalisation, we must have some fair play for those in the indus-
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      try, particularly bearing in mind that the money will not go to greedy capitalists or to individual shareholders. I hope that the hon. Member for Newton appreciates that. In the vast majority of cases the money will go to foreign firms who, like Yarrows, want to invest the money in something else. The money is not for the purposes of bingo halls or casinos or holidays in the Bahamas. It is for the creation of more jobs.
      All our experience is that the people who have owned the shipyards have, in their other spheres of activity, had considerable success in creating jobs and in achieving growth. That is the case with Yarrows, which has expanded its labour force and increased its profits, thereby making considerable contributions to the Treasury in many ways.
      Mr. Ian Lloyd: When I listened to the speeches of the right hon. Member for Jarrow (Mr. Fernyhough) and the hon. Member for Newton (Mr. Evans), and heard the right hon. Member for Jarrow saying that he had listened to a succession of nationalisation debates, and what he described as the stereotyped Conservative defence against nationalisation, I sought vainly for an analogy that would demonstrate to the House how I reacted.
      The only effective analogy I could think of was that of a man who is tempted by a very low price to buy a very old boat, and does so without taking the elementary precaution of getting a survey. He acquires this wonderful new possession, which he regards as a great bargain. It looks fine until he starts to scrape off a few bits of old paint.
      When he has scraped off the nrst few bits, he finds that the surface wood looks rotten. He then takes off some of the surface wood, thinking that he may only have to take off a little of it. He finds that he has to take off the whole of the surface wood. He gets a little further and finds that some of the frames are rotten. He thinks that he should take out some of the frames before he puts back the surface wood and starts to paint. After he has taken out parts of the frame, he finds that there is rot in the keel as well. That is the way in which I react to the economic nonsense spoken time and again when the subject of nationalisation comes before the House.
      Mr. Fernyhough: Does not the hon. Gentleman think that anyone who sells a boat of that kind should be prosecuted under the false descriptions legislation?
      Mr. Lloyd: There is an answer to that—caveat emptor. Another answer is that the buyer should first commission a survey.
      I admit that there has been insufficient investment in the shipbuilding industry. Let me illustrate why.
      I should perhaps declare an interest. I am an adviser to a major British liner company. However, I have no interest in shipbuilding as this company builds few ships at the moment. Fifteen years ago we built a large number. We owned and controlled a shipyard on the Clyde.
      At that time a policy decision had to be taken whether we should invest in the shipyard and restructure it, or do something else. At that time I visited virtually every shipyard in the Western world, including those in the United States, Scandinavia and Japan. I came back and made a report—and it was valid. I reported that the most modern shipbuilding techniques in the world were to be found in Sweden, especially in Kockums and Go Taverkeno. I proposed that the techniques employed in Kockums should be brought to the Clyde.
      That proposal was seriously examined. In the early 1960s it would have cost about £8 million or £9 million to bring our shipyard up to a state where it had the slightest hope of competing not with Japan—at that stage the Japanese industry was a small cloud on the horizon—but with the best techniques in Britain. That proposal was turned down. Why? It was turned down because there was no possibility of a reasonably effective rate of return on the investment.
      Every investor in this country—shipowner, investment institution, insurance company or pension fund—must go to those to whom he is answerable for the investment funds and say "Amongst the alternative competing investments available to me is a shipyard. If I invest £9 million in that undertaking, we shall receive a return of X per cent." In this case the X per cent. was distinctly less favourable than that from many other forms of investment.
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      That is the pattern of investment in the Western world. Hon. Gentlemen's pension fund managers may say "We have not invested in the top opportunities that are available to us. We put all the money into ailing shipyards from which the return is 3 per cent." Would hon. Gentlemen be pleased if that occurred?
      Mr. Robert Hughes: The hon. Gentleman said that such an investment would not bring in a good return. Does he therefore say that there should be no shipbuilding capacity in this country?
      Mr. Lloyd: No. The incident to which I referred took place a long time ago.
      The answer is simple. When the sums were done, the net return on the capital invested would have been far inferior to what might have been obtained in other ways. If that is true of that shipyard, with a proper rational analysis based on the comparison of modern techniques all over the world, I suggest it is true of most of the remainder in this country, if not all.
      If there has been insufficient investment it is because the general climate of private investment in this country since the Second World War has been so devastatingly hostile that people responsible for investment have become more and more discouraged. Therefore the private sector has deteriorated.
      Mr. John Evans: Does the hon. Gentleman accept that from 1945 to about 1951 the shipbuilding industry in this country had a free run in the world? The world queued up for ships built in Britain because the shipbuilding capacity of the rest of the world had been almost destroyed. Does the hon. Gentleman accept that the years from 1952, when the Conservatives were in power, were the years when no investment took place in the British shipbuilding industry?
      Mr. Lloyd: In the years immediately after the war most foreign shipyards had been destroyed and, therefore, British shipbuilding had a free run. From 1952 onwards there was considerable investment, but not enough, for the reasons I have given.
      9.45 p.m.
      Mr. Kaufman: For those who served on the Standing Committee this has been quite like old times. We had the great pleasure of listening to the hon. Member for Tynemouth (Mr. Trotter) deploying his expertise in accountancy rather more in sorrow than in anger, supported by his hon. Friend the Member for Gloucestershire, South (Mr. Cope) more in anger than in sorrow.
      We have had once again the always delightful opportunity to listen to the right hon. Member for Renfrewshire, East (Miss Harvie Anderson). One slight and to me rather depressing and hurtful variant is that the hon. Member for Glasgow, Cathcart (Mr. Taylor), with whom I got on so well in Committee, seems to have turned a little sour on me, but I shall have to live with that.
      The hon. Member for Bridgwater (Mr. King), in winding up the previous debate, said words which will apply to a great deal of what we say in our debates tonight and during the next two days—"we have covered that in Committee". Yes, we covered in Committee almost everything that has been said by Opposition Members.
      On the other hand, certain speeches made by my hon. Friends, including in particular the powerful and moving speeches made by my hon. Friend the Member for Newton (Mr. Evans) and my right hon. Friend the Member for Jarrow (Mr. Fernyhough), are major additional contributions to our debates and give me oportunities which I shall take to give additional information to the House which I am sure will be of use to it in considering the new clauses.
      With your permission, Mr. Speaker, I shall not pursue yet again the ECGD hare which the hon. Member for Gloucestershire, South chased in Committee. I had the feeling by the time we had done with it that it was satisfactorily casseroled. There is little more to be said about that runner as it has been proved to the hilt that it had no basis.
      I am glad that the right hon. Member for Renfrewshire, East is not here at the moment because sometimes in Committee I had to disagree with her and, because of the very great respect and regard in which we all hold her, that was
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      difficult and disagreeable for me. That being so, I am glad that it will not be necessary for me to say various hurtful things to her about the basis of the existence of Yarrow, because I know that Yarrow is dear to her heart.
      The right hon. Lady referred to the "devastating" cuts which my right hon. Friend the Chancellor of the Exchequer announced last week. I know that many of my right hon. and hon. Friends agree with some comments that have been made about those cuts, and my right hon. Friend said that he was not at all happy at having to make that statement. But those cuts are as nothing compared with what right hon. persons on the Opposition Front Bench have asked for. As soon as my right hon. Friend the Chancellor of the Exchequer sat down, the right hon. and learned Member for Surrey, East (Sir G. Howe) said that they were too little and too late.
      The right hon. Lady, with whom I have a great deal of sympathy, unique as she is in so many agreeable ways, is also unique in opposing the cuts while the rest of her party demand far more cuts, deeper cuts and cuts that will cause far more unemployment. So, while there is very little that we shall not take from her because of our regard for her, we shall certainly take none of it from other hon. Gentlemen.
      In moving the new clause, the hon. Member for Tynemouth, in the highly agreeable way in which he always spoke in Committee, seemed to imply—I am sure inadvertently—that I had given some commitment on this matter when it was debated in Committee. The hon. Gentleman will recall that in reply to his hon. Friend the Member for Bridgwater on this very matter I said:
      "I undertake to consider the matter. I shall certainly do that. The way in which I respond, and whether it is appropriate to come back, will depend upon the consideration. But I give the hon. Gentleman my assurance that I shall consider seriously what he said."
      Those were my words.
      The hon. Member for Tynemouth who spoke to that particular subject in Standing Committe, did not find what I said satisfactory. He said, referring to me:
      "If the hon. Gentleman had said that he would think again and come back with an amendment giving a guarantee, I should have been happy to withdraw my amendment. But

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      he has not suggested that, so I shall press the matter."—[Official Report, Standing Committee D, 9th March 1976; c. 1626.]
      The hon. Gentleman forced a Division on this because I had not given a commitment, and we defeated him by 13 votes to nine.
      That being so, as I always respect what the hon. Gentleman has to say, I hope that he will not imply that because the Government have not tabled an amendment, I have not followed up that discussion and have not. in some way, followed through a commitment which I never gave.
      My hon. Friend the Member for Newton, in an extremely moving and impressive speech dealt with, among other things, Opposition claims that public ownership was not a profitable sphere of activity. I really should have thought that after the announcements which have been made during the past few days of large profits being declared by one publicly owned industry after another the canard of hon. and right hon. Gentlemen opposite that nationalisation cannot be profitable has finally joined the ECGD hare in the casserole; because of course we are proving, as we always said we would, that public ownership can be profitable.
      The British Steel Corporation was referred to in an extremely agreeable contribution from the hon. Member for Gillingham (Mr. Burden), an old and happy sparring partner of mine. This comes back to the question of Government control of prices, to which I shall refer in dealing with the speech of the hon. Gentleman. But, of course, if we are dealing with steel and the reason why steel has lost money, the reason for that, in addition to the world recession, is the absolutely crippling price control imposed upon the corporation by the Conservative Party, from which it was released through the large price increases which Opposition Members now deplore when we became subject to the rules of the European Steel and Coal Community, against which many of my hon. and right hon. Friends voted when hon. and right hon. Members opposite took us into the European Common Market at the beginning of 1973.
      So it is the Conservative Party, with the exception of the hon. Member for Cathcart, who freed the British Steel
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      Corporation from the price control which was destroying it under the right hon. Member for Sidcup (Mr. Heath); and the corporation is now being allowed to raise its prices so as to be able to compete. That is one of the reasons why after a very serious deficit in the current year, the British Steel Corporation hopes to move into equilibrium in the next financial year and into profitability in the following financial year.
      Mr. Trotter: May I draw the hon. Gentleman's attention to column 3121 of the Official Report of a later meeting of the Standing Committee, covering the statement that we made?
      Mr. Kaufman: I am obliged to the hon. Gentleman. My hon. Friend the Member for Newton asked an extremely pertinent question and was buttressed by the hon. Member for Cathcart. My hon. Friend asked about Government aid to the shipbuilding industry over a period of years and the hon. Member for Cathcart asked whether we could break up that figure between the public and private sectors.
      I have not had as much time as I should have liked to obtain for my hon. Friend the information in the form in which he sought it, but he may be satisfied with the information that I gave the House on Second Reading. It is for a finite past period and is as valid now as when I gave it. I said:
      "It is the same with the shipbuilding industry. In the past 10 years it has received £299 million in Government loans, grants and equity capital. That does not include investment grants, development grants and regional employment premium. There is so much of that under so many headings, that it is impossible to add it all up."—[Official Report, 2nd December 1975; Vol. 901, c. 1575.]
      For the reasons that I gave on Second Reading and the inability to extract all the information because of the many headings involved, I cannot go across the whole field, but the hon. Member for Cathcart and his hon. Friends will be satisfied if I quote as a very good example, with which they cannot disagree as they were responsible for it, the aid given under the Conservative Government's Industry Act 1972.
      This is a very good Act that we have been able to use to great advantage. Under Section 11 a total of £42 million

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      was paid out in construction grants to the shipbuilding industry up to 1975–76, with nothing asked in return. I am sure that the hon. Member for Cathcart is an enthusiast for the 1972 Act. It will be useful to him and for the benefit of the House if I provide the relevant information in reply to his good and fair question
      Of the £42 million in construction grants paid out under the 1972 Act, which was passed with the minimum of opposition from the Conservative Party and none from my party, 34 million has gone to privately owned companies. I have not brought my English-made electronic calculator, but I reckon that is about 80 per cent. of the total.
      Of those grants paid out under the Act introduced by the right hon. Member for Knutsford (Mr. Davies) and the Government of which the hon. Member for Cathcart was a member, about 80 per cent. went to private enterprise and 20 per cent. to public enterprise.
      Mr. Teddy Taylor: Will not the Minister agree that construction grants, like investment grants, were sums to which every shipbuilder was entitled for every ship built and that therefore the more ships that were built, the larger the amount of grant received? Did not the hon. Member for Newham (Mr. Evans) ask not about construction grants but about Government grants and loans?
      It being Ten o'clock, the debate stood adjourned.

BUSINESS OF THE HOUSE
Ordered,
That the Licensing (Scotland) Bill may be proceeded with at this day's Sitting, though opposed, until any hour.—[Mr. Graham.]

AIRCRAFT AND SHIPBUILDING INDUSTRIES BILL
Question again proposed, That the clause be read a Second time
Mr. Teddy Taylor: Would not the Minister agree that the amount of money that has been given to the State-owned yards, plus Harland and Wolff, in discretionary grants during that 10-year period came to over £170
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million, whereas the private sector got a total of £26 million? Would not the Minister agree that this shows that the nationalised sector has by far received the lion's share—about 80 per cent.—of the discretionary loans and grants available?
Mr. Kaufman: I apologise to the hon. Member for Cathcart. I was under the obviously erroneous impression that he was going to divide the House at 10 o'clock and that is why I made those remarks.
We must take into account that Harland and Wolff only recently became part of the public sector under the hon. Gentleman's own Government's legislation, and under that relentlessly nationalising Government of 1970 to 1974 to whom the hon. Gentleman gave his support.
Mr. John Evans: Would my hon. Friend accept that, no matter which set of figures one takes, the British taxpayer has bought the shipbuilding industry three times over?
Mr. Kaufman: My hon. Friend is extremely eloquent on this subject and, of course, I accept the general drift of what he says.
The hon. Member for Gillingham seemed to imply that nationalisation was a failure—
Mrs. Elaine Kellett-Bowman: Hear, hear.
Mr. Kaufman: I am so glad that the hon. Lady the Member for Lancaster (Mrs. Kellett-Bowman) is back in the Chamber.
The hon. Member for Gillingham seemed to imply that the nationalised industries were unsuccessful because in the period that he quoted their prices had risen higher than prices had risen as a whole. He knows very well that nationalised industry prices rose faster during that period because, under the counter-inflation legislation of his own Government, those prices were held down artificially. That was one of the reasons why all of those nationalised industries went into deficit.
Another reason why their prices have gone up above average is that we are returning to realistic pricing for publicly owned industries. We are doing so at the

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behest of right hon. and hon. Members opposite who, during the debates on the Statutory Corporations (Financial Provisions) Act, earlier in this Parliament, insisted that we do so. We are, therefore, carrying this out with all-party support except, of course, that Conservative hon. Members themselves will not accept what they are asking us to do when they can make capital out of it.
Mr. Burden: It would seem that I am not the only person who thinks that the nationalised industries are not a great boon and blessing to the country. I have found very few members of the general public who are overwhelmed with joy by them.
Mr. Kaufman: The hon. Gentleman must take his opinions where he finds them. I do not know whether others agree with him.
For example, one particular nationalised industry, which is one of the oldest in the country and which was referred to in the speech by my right hon. Friend the Member for Jarrow, namely Cable and Wireless, has been nationalised for 30 years, and it is one of the most outstanding examples of profitability and efficiency in this country. It has just been most fulsomely complimented by a Select Committee of this House on its operations. I had a most happy opportunity of visiting Cable and Wireless myself last week. It is an absolutely excellent concern and a credit to public ownership.
My right hon. Friend the Member for Jarrow and my hon. Friend the Member for Newton said that Conservative Members were weeping crocodile tears over shareholders. I assure my hon. Friends that they are not crocodile tears: they are real tears. They are the only tears that Tory Members shed. They do not shed tears about the workers but they are ready to devote—[Horn. MEMBERS: "What about the unemployed?"] But the Tories want far more unemployed. They are demanding immense public expenditure cuts which will produce hundreds of thousands more unemployed. They voted against what the Government did to save Alfred Herbert, British Leyland, Chrysler and all the other companies, votes which would have created hundreds of thousands more unemployed. They cannot have it both ways.
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The hon. Member for Cathcart issued a challenge to the Government. In effect he said "Do not persist with the Bill. We have a private sector and a public sector in shipbuilding. Let them fight it out in fair competition." That might be a good idea if we agreed what fair competition meant. Do we transfer all the warship orders from private companies to public companies? Will that achieve fair competition?
When the hon. Member says that I have made damaging remarks about the shipbuilding industry by saying that certain companies are on the verge of disaster he should know that as I have gone around the country—"rushed" around the country, as the hon. Member for Tiverton (Mr. Maxwell-Hyslop) has called it—visiting shipyards, wherever I have gone, I have been grabbed hold of by workers and management alike[Interruption.]—No, they do not say that. They say, "Give us a Type 42 destroyer." That is what they want from the Government at Cammel Laird and wherever else I go—a Type 42 destroyer. As many of my hon. Friends will know, one reason that Swan Hunter is not in a parlous state right now is that we gave it a Type 42 destroyer and a through-deck cruiser as well. Without that work, private enterprise merchant ship building would be in a very bad position.
The hon. Member for Cathcart talks about the danger of talking down the Clyde, but Scottish Members know very well what the position would be in one shipbuilder on the Clyde today if the Government had not intervened.
Mr. Teddy Taylor: Which one?
Mr. Kaufman: If the hon. Member wants the name, he should approach the hon. Member for Dundee, East (Mr. Wilson) and ask him. The Scottish National Party knows very well that this British Government—[HON. MEMBERS: "Oh."]—this Labour Government saved that shipyard. Yes, this British Labour Government as distinct from the small-minded, anti-British Tory Party, which believes only in Britain and British industry provided that it is privately owned and publicly funded—
Mr. Teddy Taylor rose—
Mr. Kaufman: Yes—it is the hon. Member's time.
Mr. Teddy Taylor: The Minister cannot go on making these damaging remarks. He has said again tonight that one Clyde shipbuilding firm faces serious problems. I have spoken to them all and none of them, apart from the nationalised Govan Shipbuilders, appears to be having acute problems. Let him name the firm he has in mind so that we can save the others from his sneering attacks.
Mr. Kaufman: I shall not do what the hon. Gentleman does—namely, bring to the fore the problems of any particular company by naming it. The hon. Gentleman is prepared to smear the company that the Tory Government nationalised and saved by nationalising it. If he is getting that kind of information, he is not getting the information that we are getting. Every time Scottish Tory Members speak down this Bill, they are speaking down jobs in Scotland. That is why the Scottish TUC has issued statements supporting the Bill and demanding its passage through the House.
After those few preliminary remarks, I should like to turn to the new clauses and the amendments. As I said, they were debated at length in Committee and the Comimttee came to a conclusion on them. I made clear in Committee that the Government intend to make payments on account as large and as quickly as possible consistent with the uncertainties surrounding the negotiations.
As has been mentioned by a number of hon. Members, of the 43 companies named in the Bill 42 are unquoted. In all those cases compensation will be determined under the provisions of Clause 38 by negotiation with recourse to arbitration. We intend to complete these negotiations as quickly as possible, but it is inevitable, as I said in Committee—I repeat the words quoted by the hon. Member for Tynemouth at the beginning of the debate—with the best will in the world that it will be some time before all the settlements are reached.
We recognise that shareholders could feel aggrieved if they have a long wait before they receive their compensation, even though, as has not been pointed out by the Opposition, interest on the stock will accrue from vesting date. Therefore, we feel it right to make provision in the
382
Bill for the Secretary of State to make payments on account on compensation stock.
I assure the House that if the provision is to be of any real value, payments on account should be not only substantial, but made at the earliest possible opportunity. A small payment on account only shortly before the final settlement would be of little benefit to shareholders.
The hon. Member for Tynemouth has acknowledged that the negotiations will be complex. It will be necessary to settle the base value for compensation and to establish, on the basis of a detailed investigation of the companies' records, whether there are any inter-company debts to be treated as securities under Clause 21 and whether there are any appropriate deductions to be made under Clause 39.
We intend to make payments on account within six months of vesting day, but the complications of the negotiations may be such that in some cases it might not be possible to reach a sufficiently definitive view in that time scale. New Clause 5 and Amendment No. 230 would reduce the flexibility of the position and could act against the interests of the shareholders where the negotiations are particularly complicated.
Clearly, we wish to avoid making either interim payments or payments on account which might, in the light of further negotiations, have to be reclaimed. That would be an unfortunate situation. However, I assure the House that Clause 36 will be operated in the best interests of the shareholders. It will be used to the fullest extent consistent with the progress of negotiations. That being so, I hope that the Opposition will not persist in either New Clause 5 or Amendment No. 230.
10.15 p.m.
There was a considerable discussion in Committee on the meaning of Clause 38(5), to which both New Clause 6 and Amendment No. 294 relate. Clause 38(5) provides that where a vesting company represents a substantial proportion of a quoted parent, the share quotation of that parent should be one of the relevant factors. However, I must emphasise that it will be only one of the relevant factors. The basic requirement on the tribunal is to take account of all relevant factors in

383
determining the notional share quotation of an unlisted company. The inclusion of Clause 38(5) ensures that the quote of a parent is not excluded from the considerations when it is strictly relevant.
The application of Clause 38(5) is strictly limited. It applies only where an acquire company represents a substantial part of a quoted group. [Interruption.]
Hon. Members seem to imagine that I ought to conclude fairly soon. I have given way a good deal.
Mr. Michael McNair-Wilson rose—
Mr. Kaufman: I hope that the hon. Gentleman will forgive me if I do not give way, because the annoyance of his hon. Friends would turn on him and he would not like that at all.
Mr. Michael McNair-Wilson: I spoke on the Northern Ireland Appropriation Order on Friday and I raised the question of Harland and Wolff. At that time, in his reply the Minister said,
"There will be an opportunity to discuss the future of the firm on amendments to the Aircraft and Shipbuilding Industries Bill next week. That would be a good time to debate this subject."
Further in his reply he said,
"Either the Secretary of State or I will reply to the debate on the Harland and Wolff amendments if present business arrangements are maintained."—[Official Report, 23rd July 1976; Vol. 915, c. 2416.]
Can you tell me, Mr. Speaker, whether it will be possible to debate those amendments, in view of the very serious situation facing Harland and Wolff, and as the Secretary of State is sitting on the Government Front Bench?
Mr. Speaker: Order. All that I can say is that we shall debate matters as we come to them. I can say nothing more.
Mr. Kaufman: My right hon. Friend the Secretary of State for Northern Ireland—
Mr. Michael McNair-Wilson: As Northern Ireland has the highest unemployment of any region of the United Kingdom, are not the amendments in relation to Harland and Wolff of crucial importance and do they not deserve to be taken rather than the speech to which we are now about to listen?
Mr. Speaker: I have no doubt about the importance of the amendment, but the hon. Gentleman will understand that it is beyond my power to control the way that events go.
Mr. Kaufman: The fact is that my right hon. Friend the Secretary of State for Northern Ireland is in attendance specifically to discuss this matter, but Opposition Members have made a large number of speeches on this grout) of amendments and I am doing my best to reply to the amendments. If hon. Members do not believe that their amendments should receive a reply, I cannot understand why so many of them made speeches on the subject. I have only a little further to go. Provided I am not interrupted I can get it over with fairly quickly. However, I think that it is necessary for the House that I reply to the speeches of Opposition Members.
What I have said is that Clause 38(5) will apply only where the activities of the acquired company are clearly a major factor in determining the quotation of the parent. It is not our intention to apply Clause 38(5) where the activities of the acquired company are less than major in determining the share price of the parent.
Secondly, it is clearly stated in Clause 38(5) that the provisions of that subsection define only one of the relevant factors. This has a direct bearing on the new clause. It is not provided that Clause 38(5) should be the overriding factor. Any other factor relevant to the valuation of an acquired company will also be taken into account. The significance of Clause 38(5) in any particular case—
Mr. Robert J. Bradford rose in his place and claimed to move, That the Question be now put.
Question, That the Question be now put, put and agreed to.
Question, That the clause be read a Second time, put accordingly and negatived.

AIRCRAFT AND SHIPBUILDING INDUSTRIES BILL
  New Clause 6

    VALUE OF SUBSIDIARY COMPANY
    'An Arbitration Tribunal in arriving at the value of any security of a company shall not be required to restrict that value only by

    385
    reason of the Stock Exchange quotation of its parent company'.—[Mr. Trotter.]
    Brought up, and read the First time.
    Motion made, and Qustion put, That the clause be read a Second time:—
    The House divided: Ayes 300, Noes 303.
    [For Division List No. 284 see col. 605]
    Question accordingly negatived.

  New Clause 7

    HEADQUARTERS OF BRITISH SHIPBUILDERS
    'The headquarters of British Shipbuilders shall be located in the County of Tyne and Wear'.—[Mr. Trotter.]
    Brought up, and read the First time.
    10.30 p.m.
    Mr. Trotter: I beg to move, That the clause be read a Second time.
    It is quite extraordinary that after all this time we have had no Government indication about the location of the headquarters of British Shipbuilders. I hope that it will be located in Tyne and Wear because this is the heart of the shipbuilding and repairing industry. It is the logical place for the headquarters. It employs three times as many people in the shipbuilding and repairing industry as Merseyside, and 50 per cent. more than Clydeside. It is the home of the British Ship Research Association, and the university there has the largest and finest naval architecture department, and the only marine engineering department. Tyne and Wear is also the headquarters of the Boilermakers' Union.
    Mr. Willey: I congratulate the hon. Member on taking this opportunity to raise the issue of the headquarters, which is crucial to the North-East. I had intended to do so by way of an amendment later, and I am delighter that he has aired this matter in the House.
    There is not the slightest doubt that on merit the headquarters should go to the North-East, either Newcastle or Sunderland. The area has five times as many shipyard workers as Merseyside. The area has far more unemployment and far less office employment than Merseyside. It is time therefore that we had fair shares.
    The Merseysiders have been very slick in their representations on this matter, but shipbuilding has been concentrated on the North-East coast. We have the university with its naval architecture faculty. Research is concentrated in the North-East. On the Wear there are undoubtedly the best yards in Britain, owned by Austin Pickersgill and Sunderland Shipbuilders.
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    I am told that this will be a political decision and that it will not depend upon the personal convenience of the members of the organising committee. If it is to be a political decision, let it be recognised once and for all that the North-East coast is sick and tired of being pushed around. We have the strongest Labour area in Britain and that should be recognised. Let us have a political decision for a change. The North-East coast can offer all the facilities. Government money has been put in to improve the roads. We have the accessibility and, more important than anything else, we have the shipyards.
    Mr. R. C. Mitchell: Will my right hon. Friend give way?
    Mr. Willey: No, and I can tell my hon. Friend that the headquarters will go to an assisted area. That is one of our main concerns. The claim of the North-East coast is predominant, and we expect that to be recognised very shortly.
    Mr. Gordon Wilson: With such scenes of disunity and civil war raging in England it would be dangerous for the Government to establish the headquarters in any part of it. If the headquarters were to go to Merseyside, the North-East would be justifiably annoyed. If it went to the North-East, Merseyside would feel equally aggrieved. In those circumstances neutral territory such as Scotland would be a far better choice. Representations have been made by the hon. Member for Tynemouth (Mr. Trotter) and the right hon. Member for Sunderland, North (Mr. Willey) that it should go to the North-East. Most of the shipbuilding areas could establish a claim for the headquarters.
    If what the Government have said is true, the headquarters will be a small body of about 100 people. Such bodies tend to grow, however, so that although we are talking now of a tiny bone, in the course of time there may be a lot more meat, and especially fat, than now seems likely. There are good reasons why Scotland should be chosen for the headquarters. The first is that Scotland contains a substantial proportion of the shipbuilding industry. It is an area which has been prominent in shipbuilding for many years.

    389
    The right hon. Member for Sunderland, North claimed that his area was a Labour stronghold. But if the Government discriminate against Scotland another of their major strongholds will be lost. They would do well, therefore, to try to protect what they have there at present.
    There are two other reasons. Promises were made about the steel corporation headquarters that were not fulfilled. We were given brass-plaque type headquarters with no authority. The Government should make up for the failure of the past. Secondly—the Secretary of State will understand this—certain promises were made about the job establishment of the British National Oil Corporation in Glasgow. It was promised that there would he 800 jobs established at the headquarters, but at present there are few people if any at Glasgow and about 53 established in London. The postal address—it is no more than that—of the BNOC is in Glasgow. The only thing that is Scottish about the London headquarters is the name, which is Stornoway House. Even if the Government go ahead and establish the headquarters of the BNOC in Glasgow, there will not be 800 jobs but 200.
    The Government will have to make up for the promises they made in the past that they have failed to fulfil. There is a jobs crisis in Scotland and I suggest to the Government that if they do not place the headquarters in Scotland it will be held against them by many of their supporters.
    Mr. Kaufman: I think it will assist the House if I make the position clear. The Government have repeatedly said that the headquarters of British shipbuilders will be located in an assisted area with a tradition of shipbuilding. No decision has yet been taken. The views of the organising committees have been sought. The case for the main shipbuilding regions is being examined carefully before a decision is reached. Representatives from all the areas have been seen. I have seen them myself. There have been strong representations in favour of a location in Scotland, in the North-East and in the North-West. My right hon. Friend will announce a decision as soon as it is reached, but I hope that the House will not decide to pre-empt it in the Bill.
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    It would not be of any assistance to prolong the debate further as other hon. Members wish to discuss other subjects. The cases for all the areas are being carefully considered by the Government.
    Mr. Loyden: I do not want to enter into the parochial arguments that have been presented as I know that the Government will take fully into account all the arguments that have been presented. It is only fair to say that many of the representations from the Opposition Benches have been made by those who have viciously opposed the establishment of nationalised shipbuilding and ship repairing industries. The claims that they have made to establish the headquarters in their constituencies smack of humbug.
    The hon. Member for Liverpool, Wavertree (Mr. Steen) approached the Department about the siting of the headquarters on Merseyside. When advised by the Secretary of State that that would depend upon the Bill being enacted, he wanted to know what the location of the headquarters had to do with the Bill. It is evident that the case made by the Opposition must be examined in that light.
    Mr. Trotter: In view of the urgency of the other business, I beg to ask leave to withdraw the motion.
    Motion and clause, by leave, withdrawn.

  New Clause 12

    DUTY OF BRITISH SHIPBUILDERS TO CONSULT, ETC., WITH NORTHERN IRELAND STATE-CONTROLLED SHIPBUILDERS
    'In carrying out their functions British Shipbuilders shall have full regard to the need to consult with, and wherever possible co-ordinate their activities with those of, any body corporate in Northern Ireland whose equity share capital is held by or on behalf of the Crown and being a body corporate which is engaged in one or more of the activities specified in section 2(2) above'.—[Mr. Merlyn Rees.]
    Brought up, and read the First time.
    The Secretary of State for Northern Ireland (Mr. Merlyn Rees): I beg to move, That the clause be read a Second time.
    Mr. Speaker: With this we may take the following amendments:
    No. 248, in Clause 1, in page 2, line 3, at end insert
    'and in the case of the British Shipbuilders Corporation one of those appointed shall be an executive director of Harland and Wolff'.
    No. 243, in Schedule 2, in page 75, line 7, at end insert 'Harland and Wolff Ltd.'.
    No. 244, in page 76, line 6, leave out 'Great Britain' and insert 'United Kingdom'.
    Mr. Rees: Before speaking directly to the new clause I believe it is important, and in keeping with the wishes of Ulster Members, that I should put before the House the facts on Harland and Wolff. They are the background to my views on the new clause, and I believe it is vital that these views are on the record.
    When I took office in March 1974 I began a personal investigation into the position of Harland and Wolff. In addition to the particular problems of the company, I was concerned to find out what its relationship was with the then devolved Administration. I was and am still concerned to evaluate what public ownership meant in the sense in which it operated, the role of Government directors, the role of civil servants and how financial accountability is ensured.
    10.45 p.m.
    Above all, I was not unaware that Harland and Wolff had received large sums of Government aid. Indeed, in July 1974 the House was told that since 1966 the company had received £68 million in standard and selective assistance. It may have been a joint stock limited liability company working to the precepts of the Companies Acts and to the philosophy of private enterprise, but the plain fact was that it had been kept in being by the Government through grants and loans from the Shipbuilding Board and the Department of Commerce. This was done by a Unionist Government at Stormont and a Conservative Government at Westminster. This was not in any sense Socialism but an ad hoc corporatism that was not, I found, guided by any clarity of mind in any shape or form.
    In December 1973 I had put down a Question to the then Secretary of State
    392
    and was informed that the Government would provide guaranteed facilities for up to £10 million as needed to the end of 1976. I found that the Northern Ireland Department of Commerce held £4 million of the company's equity—about 47 per cent.
    In March 1974, on my second day in Northern Ireland, I was informed that the £10 million was already out of date and that substantial further sums would be required. This was in three months. Round about 1967, the yard had geared itself for the building of large tankers to tap the market, but by 1974 the facts of life had changed.
    Revised figures were received by July 1974, and my right hon. Friend the then Minister of State made it clear to the House that, if the company were to continue trading, further Government financial support was required urgently. Prior to that date I was dealing with decisions of a Conservative Government. They did not treat the firm as if it were a firm that ought to stand on its own feet.
    To provide further finance and to bring about changes that we thought necessary, we decided to increase the Government holding in order to give the Government a substantial majority in an expanded equity. I make it clear that this was this Government's first decision.
    We also decided on a comprehensive review of the management structure and resources of Harland and Wolff; a full examination of the order book; a temporary moratorium on any new shipbuilding orders; strenuous action to reduce overheads; and training arrangements capable of securing any necessary increase in the labour force in a manner compatible with the manpower needs of the rest of industry in Northern Ireland.
    We made it clear to the House in July 1974 that the steps taken were a rescue operation. Without it, the yard would have shut down. This operation was for Northern Ireland, where the yard is significant, and some of the money was found from offsetting savings in public expenditure in the Province. It was made clear from the beginning that it was not an open-ended Government subvention.
    Eight months later, in March 1975, my right hon. Friend told the House that the review of the situation in Harland

    393
    and Wolff was completed. The Government had been in office one year. It needed that length of time to establish the precise position.
    The only point I want to make—hon. Members can read the records of the time—is that the accounts for 1973, published in November 1974, had shown a £38 million provision for estimated prospective losses on contracts entered into prior to 31st December 1973. By March 1975—by which time the detailed financial review for which I had called was complete—it was clear that this figure had to be increased by over £22 million to about £60 million.
    Mr. Ian Lloyd: Will the Secretary of State say what proportion of the total Government subvention to Harland and Wolff has gone down the drain of operating losses and what proportion has gone to new capital investment?
    Mr. Rees: The £60 million that we then provided to the end of 1978 was to cover prospective losses. Every ship being made is made at a loss. The £60 million is to cover losses in Harland and Wolff. This is what we were doing at that time, and it was because of this that we took the yard into public ownership. The yard was taken into public ownership, and the point I make is that it was without any opposition at all from any part of this House.
    The House may vote against the public ownership of shipbuilding in Great Britain, but—[Interruption.] Hon. Members may not want a political speech but they will get one. I notice that there are those who vote against public ownership in Great Britain but are ready to vote for public ownership in Northern Ireland. The Ulster Members of Parliament vote against public ownership in Great Britain but they vote for public ownership in Northern Ireland.
    This yard is publicly owned. If it were not for public ownership the yard would have shut down two years ago. In my strong view, we are monitoring this firm, and the trade unions are cooperating magnificently in the situation. My right hon. Friend who was Minister of State did a great deal to get worker directors. But the plain fact is that the market for the products—big ships—has gone. There are problems in Har-
    394
    land and Wolff. The Government have done a great deal to keep Harland and Wolff going. It is already publicly owned. In my strong view it should not be part of the Great Britain nationalised shipbuilding industry which is to be set up.
    It is right that we should accept New Clause 12. It is right that we should co-operate. But Harland and Wolff must be ready to be run by a future devolved Administration, as are rail electricity and the other nationalised industries in Northern Ireland.
    I am glad that the Government took Harland and Wolff into public ownership. That was right for Great Britain. We had the support of the House on Northern Ireland. I am only sorry that we did not have it for Great Britain. I believe it right to co-operate, but I do not believe it right that Harland and Wolff should be part of the Great Britain nationalised shipbuilding unit.
    Mr. William Craig: I think that my hon. Friends from Ulster will appreciate the message from the Secretary of State for Northern Ireland. However, he has not reassured us as to the meaning of New Clause 12. The words "consult" and "co-ordinate" may mean a lot or a little. I am not sure that a public monopoly, or indeed a private monopoly, is ever desirable. But if there is to be a publicly-owned monopoly, there is a duty on us all to see that its resources, coming from public funds, are properly used.
    The Secretary of State reminded us that Harland and Wolff was a publicly-owned company. It would seem fairly reasonable to argue that there should be areas of common ground, especially in such matters as research. It is important that we do not duplicate the activities either in Belfast or wherever the headquarters of British Shipbuilders will be located. We should have liked to hear that kind of assurance from the Government this evening.
    The Secretary of State will know from his own experience that the decision not to include Harland and Wolff in British Shipbuilders has given rise to cause for concern in some quarters. That is virtually abondoning Harland and Wolff to the mercy of the tide of the future.

    395
    I support the Government, but I want to hear from them in specific terms that there will be effective co-ordination and co-operation between the publicly-owned organisations in Great Britain and the publicly-owned company in Northern Ireland. I should have liked the Secretary of State to spell out in clear terms and to give the workers and management in Northern Ireland some assurance there will be effective liaison on important matters such as research into world markets and the types of ship needed. I think that that may be best achieved by ensuring that at least one of the directors of British Shipbuilders will be a director of Harland and Wolff. I was glad to be supported by some hon. Members in an amendment to that effect. That would illustrate beyond doubt that there would be some meaning in the words "liaison" and "co-ordination." I hope that before the debate closes we shall be given more precise assurances about the meaning of "consultation" and "co-ordination".
    Mr. Michael McNair-Wilson: I am disappointed by what the Secretary of State said. Admittedly, he is up against the problem of time, but he must be aware that Admiral Sir Anthony Griffin, the Chairman-designate of British Shipbuilders, said that he was creating a national policy for the industry. If the word "national" is used, it must inevitably include Northern Ireland. Therefore, in that policy Northern Ireland and its great shipyard must play a part.
    The Secretary of State spoke of Harland and Wolff as if it were a bottomless pit. He knows that the world is suffering from a 60 per cent. overproduction of tankers and that the pundits in the shipbuilding world believe that by 1980 that situation may to some extent right itself. The simple question is whether Harland and Wolff is to be allowed to survive until it has a chance to prove that all the money that has been invested in the new equipment to make it the best tanker yard in the United Kingdom, the British Isles and perhaps Western Europe has not been wasted. Is it to be allowed to survive and to turn out the ships for which it has been so amply re-equipped, or is an arbitrary
    396
    decision to be made? On 2nd August 1975 the Minister of State said that it was the last chance for the company.
    The amendment in my name and those of the right hon. Member for Belfast, East (Mr. Craig) and the hon. Member for Belfast, South (Mr. Bradford) suggest that a director of Harland and Wolff should be a member of the Board of British Shipbuilders. That view is shared by the Chairman of Harland and Wolff. I have here a letter from him in which he says:
    "My personal view is that representation on the board of British Shipbuilders of a director of Harland and Wolff would be beneficial to this company."
    More than the airy promises in the clause is required to give Harland and Wolff a feeling that it is in community with British Shipbuilders and not being treated to some extent in isolation. I hope that the Secretary of State will say something to give confidence to Northern Ireland.
    Mr. Gerard Fitt: I have listened to the Secretary of State putting the Government's viewpoint on Harland and Wolff. My view appears to be opposed to the majority viewpoint of the trade union movement in Northern Ireland on the bringing of Harland and Wolff into the ambit of the nationalisation programme.
    I live in Northern Ireland and I know many of the workers in the Belfast shipyard, some of whom do not support my political views, but I still cling tenaciously to the belief that the Northern Ireland people, recognising the linchpin of the industrial programme, wish to have Northern Ireland people looking after the affairs of the Belfast shipyard.
    The shipyard has received from the Westminster Parliament over several years financial assistance amounting to £137 million. I do not believe that any British Government, Conservative or Labour—particularly Conservative—would look with sympathy at the shipyard's problems, but perhaps next month or the month after there will be a devolved Government in Northern Ireland representing all political viewpoints. It is those people who will know the problems which are upsetting the Belfast shipyard.
    Mr. Tom King: On a point of order—
    Mr. Speaker: I will take the point of order afterwards. The Resolution of the House obliges me to put the Question now.
    It being Eleven o'clock, Mr. SPEAKER proceeded, pursuant to Orders [20th July and this day], to put forthwith the Question already proposed from the Chair.
    Question agreed to.
    Mr. SPEAKER then proceeded to put the Questions necessary for the disposal of the Business to be concluded at Eleven o'clock.
    Clause added to the Bill.

  Clause 1

    BRITISH AEROSPACE AND BRITISH SHIPBUILDERS
    Amendments made: No. 1, in page 2, line 26, leave out 'any member or officer thereof' and insert:
    'by or on behalf of any of the Corporation's members or employees'.
    No. 2, in page 3, line 2, leave out 'or gratuity'.
    No. 3, in line 26, at end insert:
    '(8A) The Secretary of State shall maintain in respect of each Corporation a register of members' financial interests and shall ensure that all members of a Corporation enter in the register kept in respect of it statements of such of their financial interest as, were they Members of the House of Commons they would be required to register in accordance with resolutions of that House, any such resolution being construed, in its application to members of a Corporation, with appropriate modifications.'.—[Mr. Kaufman.]
    Further consideration of the Bill, as amended, adjourned.—[Mr. Snape.]
    Bill, as amended (in the Standing Committee and on recommittal), to be further considered tomorrow.
    Mr. Tom King: On a point of order, Mr. Speaker. Is there anything to protect the interests of opposition Members and parties? You will be aware of the lengths to which we went in not moving our amendments and curtailing debate, to allow the Secretary of State for Northern Ireland—who made a particu-
    398
    lar effort to be here—to reply to what are recognised in Northern Ireland to be significant amendments which could have real implications. They cover a wider span than the Department of Industry and industrial matters.
    It is intolerable for Opposition parties in that situation that the Secretary of State made a political attack and made little attempt to deal with the amendments. For him to go to every length when we were under the guillotine to put at risk our support for bipartisan industrial policies—
    Mr. Speaker: Order. I have heard enough to realise that that is not a point of order for me.
    Rev. Ian Paisley: Further to that point of order—
    Mr. Speaker: The hon. Gentleman will have heard that I indicated that it was not a point of order for me. Is it a new point?
    Rev. Ian Paisley: Yes. Tonight, because of the guillotine it has not been possible for the Secretary of State to reply to the points made to him, whether we agree with his speech or not. As the House has passed the new clause and it has not been defined, is there any way in which the Government can tell us what they mean by the clause that we have now passed?
    Mr. Speaker: Order. Hon. Members and right hon. Members know well that with the timetable motion I have to put the Question, and that is the end of the matter for the time being.
    Mr. Michael McNair-Wilson: On a point of order. While I accept your ruling, Mr. Speaker, it seems unfortunate that it is impossible for the Secretary of State to answer some of the points raised. Is it not possible for the Government to alter the motion tomorrow so that half an hour could be allowed for this clause and so that the amendments to it could be discussed?
    Mr. Speaker: Motions which the Government table tomorrow are not my concern. What the hon. Members said will have been heard, but we have dealt with New Clause 12.

LICENSING (SCOTLAND) BILL
As amended (in the Standing Committee), considered.
LICENSING (SCOTLAND) BILL
  New Clause 1

    RESTAURANTS IN PUBLIC HOUSES MAY HAVE PERMITTED HOURS ON SUNDAYS IN CERTAIN CASES.
    '.—(1) This section shall apply to any premises for which a public house licence is held—

    (a) if the holder of the licence gives notice of the application of the section to the premises in accordance with subsection (6) below, and

    (b) as from such date as may be specified in the said notice:

    Provided that a licence-holder shall not give notice of application as aforesaid, and this section shall not apply to the premises for which he holds his licence, unless—

    (i) the licensing board for the area with in which the premises are situated is satisfied that the premises are structurally adapted and bona fide used, or intended to be used, for the purpose of habitually providing the customary main meal at midday or in the evening, or both, for the accommodation of persons frequenting the premises, and that the part of the premises mentioned in subsection (3) below does not contain a bar counter; and

    (ii) in the case of premises situated in a new town as defined in section 53 of this Act, the committee constituted under section 48 of this Act for the new town have notified the licence-holder that they have no objection to the application of this section to the premises.

    (2) While this section applies to any premises, the effect shall be that for the purposes mentioned in subsection (3) below there shall be permitted hours in those premises on Sundays. such permitted hours being the period between half-past twelve and half-past two in the afternoon and the period between half-past six and eleven in the evening.
    (3) The purposes referred to in subsection (2) above are—

    (a) the sale or supply to persons taking table meals in the premises of alcoholic liquor supplied in a part of the premises usually set apart for the service of such persons, and supplied for consumption by such a person in that part of the premises as an ancillary to his meal; and

    (b) the consumption of alcoholic liquor so supplied.

    (4) While this section applies to any premises, then for purposes other than those mentioned in subsection (3) above, or in parts of the premises other than the part so mentioned, or except as provided by sections 58, 59 or 60 of this Act, there shall be no permitted hours on Sundays.
    (5) This section shall cease to apply to premises on such day as may be specified in the notice if the holder of the licence gives notice of the disapplication of the section from the premises in accordance with subsection (6) below:
    Provided that this section shall cease to apply to premises at any time on the licensing board ceasing to be satisfied as mentioned in paragraph (i) of the proviso to subsection (1) above.
    (6) A notice of the application of this section to, or of the disapplication of this section from, any premises—

    (a) shall be in writing;

    (b) shall, in the case of a notice of application, specify the date from which the section is to apply to the premises and, in the case of a notice of disapplication, state that the section is to cease to apply to the premises on the date specified in the notice;

    (c) shall be served on the chief constable not later than 14 days before the date specified as aforesaid.

    (7) The holder of the licence for premises to which this section applies shall keep posted in some conspicuous place in the premises a notice stating that this section applies thereto and setting out the effect of its application, and if any licence-holder contravenes this subsection he shall be guilty of an offence.'.—[Mr. Milian.]
    Brought up, and read the First time.
    11.4 p.m.
    The Secretary of State for Scotland (Mr. Bruce Milan): I beg to move, That the clause be read a Second time.
    With this there is a considerable number of amendments to be discussed.
    I hope that the House will bear with me if I explain how the amendments are grouped because it will be important when we vote.
    The first group includes Government Amendments Nos. 43, 45, 55, 56, 57, 59, 91 and 97. This group, taken with New Clause 1, puts the Bill back into the state in which it was before the successful amendment moved in Committee to allow the Sunday opening of public houses. These amendments are a self-contained group and are internally consistent.
    The second group includes Government Amendments Nos. 6, 10, 47 and 92, and Amendment (a) to the proposed new schedule, in paragraph 6, after "locality" insert
    "or is opposed by the residents of the locality."
    This group of Government amendments represents the Government's fallback position if we are defeated on New

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    Clause 1 and the associated amendments to remove Sunday opening from the Bill. I suggest that if hon. Members vote for the first amendment in these two groups, it will be logical to vote for the other amendments in each group.
    The group of Opposition amendments includes New Clause 3—Limitation of Sunday opening: Location; New Clause 4—Application for Sunday opening licence; Amendment No. 46, in Clause 54, page 37, line 40, leave out from "when" to end of line 43 and insert
    "There shall be no permitted hours";
    and Amendment No. 49, in page 38, line 14, at end insert,
    '(5) Notwithstanding the provisions above, the permitted hours under subsection (2) above shall only include Sundays in licensing board areas where the adult population express a desire to have Sunday opening.
    (6) To establish public opinion under subsection (5) above, each licensing board shall, on a day to be appointed by the Secretary of State, hold a referendum on Sunday opening and if a majority of those voting in the referendum vote for Sunday opening, the permitted hours shall be deemed to include Sundays.
    (7) If, not later than 30 days of a date to be specified by the Secretary of State each five years from the date of the referendum under subsection (6) above, 10 per cent. of the electors in a licensing board area request a further referendum, the licensing board shall hold a further poll'.
    The main proposals, New Clauses 3 and 4, are virtually the same as some of the amendments under the second group. If those amendments are accepted, we should remove further confusion by not voting on the Opposition amendments.
    Amendment No. 49 in the name of the hon. Member for Glasgow, Cathcart (Mr. Taylor) raises a separate issue on which the House must decide, though I think the hon. Member will accept that his amendment would fall if New Clause 1 were passed.
    Mr. Teddy Taylor: The Minister rightly says that if the Government are successful with New Clause 1 and the associated amendments, the referendum amendment will fall because there will be nothing on which to have a referendum. But what will be the position of my amendment if the Government lose the amendments under the first group but win their fall-back position?
    Mr. Millan: The House will be able to decide on the hon. Gentleman's amendment. My advice will be that we should decide against it, but it is a matter for hon. Members.
    I do not want to explain all the amendments in the first two groups. It would not add to the clarity of the situation. I hope that hon. Gentlemen will accept that these two groupings are self-contained and consistent, and if I explain their general purpose I hope that it will not be necessary to explain them in considerable detail. I would make a few introductory remarks at the outset because this question of Sunday opening of pubs has excited a tremendous amount of public comment in Scotland.
    Before I come to the main arguments I would say a few things by way of introduction. There has been a suggestion that on a matter of this sort we should simply accept what the Clayson Committee has recommended. In order that there is no misunderstanding, I should say right away that I do not believe that to be a proper relationship between any committee and the decision of this House. These matters are matters for this House and not for the Clayson Committee. Similarly, they are not matters solely for the Standing Committee on the Bill. This is a matter of such importance that it was inevitable—
    Mr. Hamish Watt: Will the right hon. Gentleman give way?
    Mr. Milan: I had hoped not at this early stage.
    Mr. Watt: Would the Minister not agree that in respect of the whole question of licensing in Scotland it would have been much more appropriate had the Scottish Assembly been left to decide the matter?
    Mr. Milan: I hope that we are not going to have that kind of interjection because I have a lot to say. I do not want to make my speech too lengthy, but I want to say a number of things about this group of amendments. This is the only long speech that I wish to make and I hope that I shall be allowed to make it.
    I was making the point that on an issue of this sort. I do not believe that one should take the view of the Standing

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    Committee as the final word on the matter. There has been misunderstanding outside, I think genuine misunderstanding but, unfortunately, that misunderstanding has been encouraged by certain people who ought to know better who have suggested that somehow or other the Government are going against the will of the House. I would remind hon. Members that the will of the House has not yet been expressed.
    On this matter I have accepted all along that there must be a free vote. These are all matters of conscience and there is no Whip on the Government side of the House. There has never been any intention on my part to put a Whip on the Government side. I make that absolutely clear because there has been a lot of completely misinformed, as well as some malicious, comment outside in this respect. I have not attempted to Whip my own Scottish Members or English Members. Nor have I attempted to influence the ministerial votes either in the Scottish Office or elsewhere. I know that one of my colleagues in the Scottish Office intends to vote against my own view on this matter. There has been a certain amount of comment in the Press, but there has never been any intention of using ministerial votes.
    I would also say a word about English Members in relation to the Division when it is called. I very much hope that this will basically be a decision of Scottish Members. It is not, of course, possible for me—it would be completely improper—to suggest that English Members are not entitled to vote on this issue. They are entitled to vote just as, on other issues, Scottish Members within the last few days have voted on what have been exclusively English matters. I see nothing wrong in principle about that and, therefore, there has been no intention on my part to say that English Members should not vote. Nevertheless, I hope that at the end of the day the vote will represent Scottish opinion on this matter.
    A final point I want to make by way of introduction relates to the amendment in the name of the hon. Member for Cathcart. I have never been in favour of settling this issue by means of local polls or a referendum. The hon. Member for Cathcart has tabled an amendment on that subject. I will not deal with the
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    details of it now because my hon. Friend, in winding up the debate, will be able to pick up individual points. I would merely say that I do not believe that experience of local polls in the past gives us much ground for optimism that this is a satisfactory way of dealing with this difficult subject.
    11.15 p.m.
    Mr. Russell Johnston: Is the right hon. Gentleman thereby suggesting that that system does not work in Wales?
    Mr. Millan: I have enough trouble dealing with Scotland without making any comment on Wales. I would only say that I think that we should decide these matters in the light of Scottish interests and not pay too much attention to what happens in Wales or anywhere else.
    Mr. Teddy Taylor: Before the Secretary of State leaves that point—
    Mr. Milian: I hope that I shall not be interrupted too frequently or this speech will be far too lengthy and eventually will become irksome to the House.
    Mr. Teddy Taylor: The Secretary of State said that his hon. Friend would deal with Amendment No. 49 in his winding-up speech. Surely he is not suggesting that we are debating the three groups of amendments together. Surely the logical thing is to debate the first group first, then, depending on the result of the vote, the second group, and then the third group.
    Mr. Millan: I think that I have made it clear that the way in which the selection has been done means that we are debating all three groups together.
    I want to come to the main arguments on the question of Sunday opening. There are a number of arguments here and I shall mention some of them only fleetingly because they are not matters which weigh particularly heavily with me. That does not mean that I do not accept that they weigh heavily with other hon. Members. These are matter of personal conviction.
    The Sabbatarian argument, for example, does not weigh heavily with me, but I understand that there are parts of Scotland and some hon. Members for whom that is the main and conclusive argument. I would say only that it is

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    not for me the conclusive argument. I am expressing here basically my own view, although it is the view that the Government took when introducing the Bill. Similarly, some people feel that Sunday opening would be extremely damaging to family life in Scotland on a Sunday. Again, that is a point of view that I respect but it is not the argument which weighs most heavily with me.
    Those are not even the arguments which weighed most heavily with the Church of Scotland when it made representations to me. It was neither the Sabbatarian nor the family life argument which it deployed with me. It was in fact the arguments, to which I shall come in a minute, about the problems of alcoholism and drunkenness in Scotland, There has also been mention of the views of publicans and their staff. Questions have been raised about the standards of premises. These are all important matters which no doubt will be argued tonight, but my own view is that the matter which no doubt will be argued tonight, but my own view is that the matter which is the most important is that of health and alcoholism and the various consequences which flow from the present alcoholism problem in Scotland. If I were to put my view on this in a sentence, I would say that Scotland has a drink problem and that Sunday opening will make that problem worse.
    Mr. Tom Litterick (Bimingham, Selly Oak): Will the Secretary of State give way?
    Mr. Millan: As I said, I do not want to be constantly interrupted, but I shall give way on this occasion.
    Mr. Litterick: Since my right hon. Friend has made something of that point, will he give us factual advice of the comparable incidence of alcoholism in England and Scotland, so that those of us who do not represent Scottish constituencies can better understand what he is saying?
    Mr. Millan: I was going to give both the Scottish and the English figures, if hon. Members will allow me to deploy my argument, I hope to cover a number of the matters in which they are interested.
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    Alcoholism is a major health problem in Scotland at the minute, but it is more than that. It is a social problem as well. The problems of excessive drinking and alcoholism cause a tremendous number of social problems which come the way of the social work departments in many areas and are a considerable social burden on the community. They are also related to the incidence of crime in Scotland at every level from minor to major crimes. Anyone who has read the histories of life prisoners, as I have had to do during the last two or three months, will be depressed by the incidence of excessive drinking in crimes at that level, much less in the thousands of petty crimes that take place.
    I want to give some statistics of hospital admissions in Scotland on the ground of alcoholism. The figures have gone up in an alarming way. In 1957 there were 840 admissions. In 1974 they had risen to 5,417. They now represent 20 per cent. of all admissions to psychiatric hospitals in Scotland. What is more, the rate of increase has accelerated over recent years. The problem is getting worse, not better.
    There has been a substantial increase in offences of drunkenness in recent years. Indeed, the Blennerhassett report brought out the fact that drunken driving is a worse problem in Scotland than in any other part of the United Kingdom. The figures are indeed striking. The total cost to Scotland of alcoholism is now reckoned to be about £35 million a year through absenteeism, loss of training, accidents and reduced output in industry, quite apart from the tremendous social cost. That figure will be given in the report on Health Services in Scotland for 1975 which I hope will be published later this week.
    Those who believe that we do not need to worry particularly about this problem, despite these dramatic figures, because we can leave it to the National Health Service or social work departments, exhibit a remarkable degree of complacency.
    The report on Health Services in Scotland, referring to the treatment of alcoholism, states:
    "There is no wonder cure for alcoholism."
    The fact is that, even if we could afford to increase our facilities in the hospital service much more rapidly than we can

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    afford to do so at the moment, that would not deal with the problem, because we are dealing with something that cannot easily be cured by medical or, indeed, by any other means.
    Therefore, we have an increasing problem which, in certain parts of Scotland—not least the Highlands—is extremely serious. There is no easy way out of it through the hospital service, social work departments, and so on. That is a sombre background.
    Whatever individual Members' views may be about Sunday opening of public houses, I hope that they will bear in mind that we are dealing with an extremely serious health and alcoholism problem in Scotland.
    We must ask ourselves whether the licensing system has any part to play in controlling this problem. I think that it has. It is not by itself a remedy, but it has a part to play in controlling the problem. If it does not have a part to play, I wonder why we have a licensing system at all. To those who say that the licensing system is irrelevant, I simply say that is not the experience over the years. We have a licensing system for a variety of reasons. One is that, without a licensing system, some of the problems would be completely out of control.
    The licensing system has a relevant part to play in this matter because, although a good deal of judgment is involved and there is no certainty, there is not much doubt that increased consumption of alcohol overall leads to increased drunkenness, alcoholism and social problems.
    Taking the United Kingdom as a whole, the consumption of alcohol has increased rapidly in recent years. For example, the consumption of spirits has risen from 19 million proof gallons in 1964–65 to 32 million proof gallons—almost double—in 1973–74. In the same period, the consumption of wine has increased from 27 million gallons to 68 million gallons—two and a half times as much. There has also been an increase in the consumption of beer of about 33 per cent. That increased consumption is undoubtedly leading to increased drunkenness and alcoholism and all the problems that flow from that.
    The evidence on the increased availability of drink is not as clear as that
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    on increased consumption, but the balance of evidence is that increased availability of liquor leads to an increase in drunkenness and alcoholism and all their associated problems. It is true that once a person is an alcoholic, closing public houses on Sundays or even seven days a week will not be much use. Alcoholism is a serious and difficult problem to which no-one has the answer, but the licensing system has a role to play.
    I accept that most Scots, like most people in other parts of the world, drink sensibly. Drink is not a problem for them nor is it likely to become one. But we are dealing with a significant minority of people for whom drink is a problem and one which, in some cases, becomes out of control.
    In determining our views on these matters we have to strike a balance between the convenience of the majority, for whom drink is not a problem, and the dangers that will be created by a greater liberalisation of the law which will lead to an increase in the problems. The issue concerns where we strike that balance between the convenience of the ordinary citizen who should be able to drink without unreasonable constraints and the dangers created by being too liberal in our licensing laws. That can only be a matter of judgment.
    Apart from the Sunday opening issue, the Bill is a liberalising measure which lengthens opening hours during the week. That is sensible for the social convenience and habits of the majority. Even that by itself, will lead to increased consumption and ultimately to an increased alcoholism problem. In my judgment, that is a price that we should be willing to pay for the convenience of the majority of citizens. But, if we go too far in this liberalisation we shall go over the edge of acceptability and increase the problems of the minority who cannot control their drinking and who are potential victims of alcoholism. We would take too great a risk with the Scottish population as a whole.
    Although Sunday drinking and the Sunday opening of public houses cannot be demonstrated in any logical or decisive way to push us over that edge, I believe that if we make this change—which is so considerable as to amount to a qualitative change—it will push us

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    over that edge, cause damage and increase all the problems. While one can defend the liberalisation in the Bill of evening drinking, once one adds Sunday opening to that, the balance shifts and one takes a risk with the health of the people of Scotland. As the Minister responsible, I am not willing to take that risk.
    11.30 p.m.
    I know very well that the present Sunday licensing laws are not logical. In fact, the licensing laws generally are not logical. It is not a matter on which one can achieve complete logicality. The present Sunday situation is unsatisfactory. But it is better that we should continue with that unsatisfactory situation than attempt to solve it in a way which will lead to even bigger problems. That is why I am against Sunday opening of public houses.
    Mr. George Younger: If the Secretary of State's argument so far is valid, would not those areas in which drink is freely available on Sundays, because of the number of hotels, have the highest incidence of alcoholism? Has the right hon. Gentleman any evidence to show that that is so?
    Mr. Millan: The trouble is that in the places in which hotels are open on Sundays the drinkers are not necessarily the people who live in the area. Therefore, the question of evidence cannot—
    Mr. Robert Hughes: Will my right hon. Friend explain what he means by that? Is he suggesting that, for example, people who drink in hotels in Aberdeen in the main come from outside Aberdeen?
    Mr. Millan: I was not thinking specifically of Aberdeen. I should have thought it to be common ground that there are some areas where there are more hotels than others, and that in those areas Sunday drinking is not confined to the local residents. It is part of the complaint of people living in those areas, in favour of the Sunday opening of public houses, that they do not like people coming in from outside. I am simply saying that the kind of evidence for which the hon. Gentleman asked cannot be produced to demonstrate the incidence of alcoholism in one area compared with another. The area with
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    the worst alcoholism in Scotland is the Highlands. My impression is that that is the area where the availability of drink is highest, for various reasons which I do not want to go into now.
    It may very well be that we made a mistake in what we did about Sunday opening of hotels. Perhaps if we could look at the matter again we should come to a different conclusion, but it would be extremely difficult to do that. Once one liberalises the licensing laws in one direction it is very difficult to turn the clock back. The pressure is always for continued liberalisation.
    My view is that if the House decides on the Sunday opening of public houses, against my advice, it will be extremely difficult, even for the Assembly, at any time to reverse that decision. It is the slippery slope argument.
    Mr. Alexander Fletcher: Does the Secretary of State agree that it is a terrible indictment of the Scottish character that for some reason behaviour on the Scottish side of the border seems to be drastically different from that in the North of England? Has the right hon. Gentleman been able to discover why people in the North of England can drink on Sundays and the rest of the week and behave reasonably, whereas, according to what he has said, that cannot be the case north of the border?
    Mr. Millan: I am coming to that. One of the arguments that have been advanced in favour of Sunday drinking—and it obviously affected the judgment of the Clayson Committee—was that by liberalising the licensing laws in this way one would introduce more civilised drinking circumstances in Scotland and that that would reduce the Scottish drinking problem. In my judgment, that is the most wishful of wishful thinking. I do not believe that this is a matter which can be wholly explained in terms of the licensing laws.
    But to those who ask "Why cannot we be like the English? There is no problem in England", I should like to give the English figures. There is a myth that there is no problem of alcoholism in England. In fact, it is now increasing as rapidly as in Scotland, despite the so-called civilized English drinking

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    habits. The figures for hospital admissions in England have gone up from 7,600 in 1967 to 13,200 in 1974. The problem of alcoholism is increasing rapidly in England and Wales, and the Advisory Committee on Alcoholism has drawn attention in a recent report to the fact that—
    Mrs. Judith Hart: I am sorry to interrupt my right hon. Friend, but it would be a pity if he were to use figures that could in any way be said to mislead the House. He must be aware that with a number of diseases, for such alcoholism is, an increased capacity for diagnosis is frequently responsible for increasing figures of hospital admissions.
    Mr. Millan: The problem of alcoholism is not a problem of diagnosis. I was about to give the figures, which are not disputed, and then to make a general comment. Whereas in England admissions to mental hospitals were increasing by about 5 per cent. a year before 1969, since then they have been increasing by an average of more than 10 per cent. a year, and in later years by an average of 13 per cent. a year. So the English, starting from lower base figures, now face an alcoholism problem that is increasing as rapidly as is that in Scotland. Therefore, the idea that if we open the pubs on Sunday we shall somehow civilise the situation in Scotland and go to the English situation and not have an increase in alcoholism does not bear serious examination.
    But at the end of the day these are matters of judgment and individual hon. Members will have to make the decision for themselves. It is one of the characteristics of the alcoholic that he refuses to recognise that he has a problem before it is too late. I suggest that many people in Scotland are refusing to recognise that we have a drink problem in Scotland and that they will not recognise it until it is too late. I therefore strongly advise the House to reverse the decision taken by the Standing Committee. That is the purport and effect of New Clause 1 and the various amendments related to it.
    If the House does not do that, I hope that hon. Members will nevertheless vote for the second group of amendments, which from the Government point of view represent a fall-back position, although
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    not a very satisfactory fall-back position, and I hope that hon. Members will not think that the problem will be solved simply by voting for the fall-back position. Government Amendment No. 6 and the amendments following from it have the effect that if there were a move to stretch a public house licence from six days to seven days. whenever that move took place it would involve a new application for the seventh day and that application would attract the various rights of objection written into the Bill for a new application for a licence. I want to make it absolutely clear that in any case the effective date for Sunday opening will be 1st July 1977, which is when the licensing boards come into operation. The application for the seventh day could not result in the existing licence for the six days being taken away.
    I accept that there has been an argument about standards of premises, and the standards in Scotland need to be improved, but they should be improved for all seven days of the week, and if the premises are not suitable for the seventh day, they cannot be suitable for the other six. By the Bill and the licensing boards we should try to eliminate unsatisfactory premises. There is no logic in taking away a licence for the whole week on the basis that the premises are not structually suitable and of a sufficient standard for the seventh day.
    Another test is applied by the amendments. It is that of public nuisance, of an undue disturbance in the locality. Therefore, one can make a distinction between a licence which is operative for six days, and a licence which is operative for seven. Any public house, even a well-managed one, normally involves a certain amount of nuisance in the locality. That is almost inevitable. One could take the view that what might be tolerable for six days a week, could go beyond the bounds of tolerability for those living in the area if a public house opened on the seventh day as well.
    The test applied in the new schedule is the test of undue disturbance or public nuisance. I hope that that will deal with the problem of public houses in the tenement properties. This is a very serious problem in some of our cities. Another part of the schedule allows for

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    Sunday restriction orders. Again, this is related to the concept of undue disturbance or public nuisance.
    This is a description of the fall-back position. I do not consider this second group of amendments as being anywhere near as satisfactory as the first group. Those who are as worried as I am about the problem of alcoholism will be deceiving themselves if they believe that the second group of amendment will deal adequately with that issue.
    Hon. Members take the view that I take on the subject of Sunday opening should vote for the first group of amendments. If we are defeated on them—and I hope that we shall not be—I hope that the House will accept the second group, which are not significantly different in purpose or effect from the amendments in New Clauses 3 and 4, put down by hon. Gentlemen opposite.
    I have deliberately kept the tone of my remarks at something less than an emotive level, although this sort of approach has not necessarily characterised a good deal of Press and other comment in recent weeks. I hope that the House will not misunderstand, and think that this is because of lack of strong conviction or personal feeling. I feel very strongly indeed about the problem of alcoholism which we have in Scotland at the moment. Therefore I shall resist very strongly indeed any measure which would carry a possibility of increasing that problem in any significant way.
    I ask the House to vote for New Clause 1. If it does, all other amendments in the first group should be carried through correspondingly, so that we get a consistent Bill. If New Clause 1 is defeated, then I do not propose to move the other amendments in that group. It is not sensible to vote for every individual amendment. If the new clause is accepted, the second and third groups of amendments will fall. If New Clause 1 is defeated I shall move Government Amendment No. 6, and if that is successful I shall move all the other amendments in that group. If it were unsuccessful, the others would fall.
    We should try to organise the vote on this contentious issue in a way which will give a clear indication of the House's opinion, and of Scottish opinion. I hope that this expression of opinion will
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    endorse the view which I have put to the House.
    11.45 p.m.
    Mr. Malcolm Rifkind: I think that the whole House will agree that it is not satisfactory for the House to have to consider, after 11 o'clock at night, a long list of amendments on which discussion is clearly destined to go through the early hours of the morning.
    Mr. Millan: The hon. Member knows that this way of proceeding was agreed with the official Opposition.
    Mr. Rifkind: If the House were aware of the options open to us it would not disagree with the view that I originally put forward.
    Many hon. Members will feel on this group of amendments that it was not altogether necessary for the Government to reverse the opinion expressed by the Standing Committee. On a free vote with all parties split, it came down in a clear majority to a decision that the Government are now seeking to reverse. There was a clear majority in each of the main parties. Now the Government have brought the matter before the House in an attempt to reverse the Committee decision.
    Mr. Norman Buchan: The hon. Gentleman is perpetuating the sort of nonsense we have been getting from my hon. Friend the Member for Berwick and East Lothian (Mr. Mackintosh). It is perfectly proper for the House to reverse decisions made in Committee, and it is time we got that nonsense out of the way because it has been bedevilling the whole argument.
    Mr. Rifkind: Each hon. Member must make up his own mind about that.
    The House is faced with a clear question of principle on the general issue. Fortunately that will have to be determined on the first new clause.
    Those on both sides who supported the amendment in Committee did so taking account of the clear views expressed by both major committees which have examined in great depth the whole question of licensing in Scotland over the last 20 years. In 1960 the Guest Committee first recommended that public houses should be allowed to open on a Sunday. That

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    view was not accepted by the then Government. Thirteen years later in 1973 the Clayson Committee, after more exhaustive study, recommended unanimously in favour of the proposal subsequently carried in the Standing Committee. It is important that the two independent committees representing a wide body of opinion in Scotland felt able to favour the proposal so strongly.
    It is important also to bear in mind the bodies which put their views to the Clayson Committee. The report pointed out that while those opposed to Sunday opening were almost exclusively the temperance movement and the Church of Scotland, there was on the other hand a vast majority of organisations which made representations to the contrary. They included all the local authority associations, the catering and tourist organisations, not surprisingly, the Brewers' Association of Scotland and the Scottish Licensed Trade Association, the Scottish Trades Union Congress, the Association of Chief Police Officers in Scotland and many others. They included the Roman Catholic bishops, apart from those bodies that might be said to have a direct financial interest in licensing. When there are such diverse bodies as the STUC, the local authorities and the chief police officers all recommending in favour, clearly they represent a substantial body of opinion that one can reject only after serious consideration.
    Mr. Donald Stewart: The Church of Scotland's recommendation has to be taken into account.
    Mr. Rifkind: The hon. Gentleman is absolutely right. One has to balance the views of the Church of Scotland and the temperance societies against the views of local authorities, the chief constables, the STUC, the Roman Catholic bishops and a number of other bodies and organisations. That is something that the House should take into account when considering the matter.
    The Secretary of State concentrated, quite properly, on the serious problem of alcoholism in Scotland. As the right hon. Gentleman said, the problem is not confined to Scotland. It is an increasing problem south of the border—namely, in England. I think that all hon. Members, whatever their views on the new clause, are equally concerned about the problem
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    of alcoholism and finding the best way of dealing with it. The question is whether it is directly relevant to Sunday opening.
    I suggest to the Secretary of State that although his argument was carefully presented it was unsound for two reasons. First, the spirit in which he presented it was contrary to the whole spirit of the Bill, which has been introduced by a Government of which he is a prominent member. If it is the basis of his argument that by increasing the permitted hours by opening public houses on a Sunday we shall increase the problem of alcoholism, that is difficult to sustain against the argument that we should support the other parts of the Bill that increase permitted hours on the other six days. That is fundamentally an illogical position. To be fair to the Secretary of State, he conceded that it was fundamentally illogical.
    It is necessary to ask the right hon. Gentleman and those who support his point of view how they reconcile that position with the rest of the Bill. It is easy for certain Members, including my hon. Friend the Member for Glasgow, Cathcart (Mr. Taylor) and the hon. Member for Western Isles (Mr. Stewart), who oppose the whole Bill and the liberalisation of the licensing laws. I can understand their argument. At least those who are in total opposition are logical, even if one does not agree with them. It is clearly illogical for the right hon. Gentleman to suggest that it is permissible to increase the permitted hours on the six days but not on the seventh.
    I said that there were two reasons for the right hon. Gentleman's argument being unsound, and the second is equally important. His argument would be proper and might be convincing if it were not possible at present to obtain alcoholic liquor on a Sunday. If there were no availability in Scotland on a Sunday it could be argued that the consumption of liquor would be increased tremendously as a result of such a proposal, but as the right hon. Gentleman conceded, anyone who wishes to drink in Scotland on a Sunday can do so. Hotels throughout Scotland provide this form of refreshment. There are many clubs whose raison d'être is to provide that sort of refreshment. It is because of the problems of overcrowding and associated

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    difficulties that various people, including the chief constables, have recommended in favour of this change.
    The right hon. Gentleman correctly pointed out that many of those who frequent hotels for alcoholic liquor on a Sunday do not necessarily live in the vicinity. This is part of the problem. It is because of the non-availability of alcoholic liquor in public houses that many people travel sometimes considerable distances for such refreshment. Therefore, the dangers of drunken driving are increased. To get alcoholic refreshment, especially in rural areas, it is sometimes necessary to traverse considerable distances.
    There is a further problem. Although there is a considerable availability of hotels serving alcoholic liquor in many of the cities and the more prosperous areas, in the industrial areas there is not the same availability. Equally, many persons in areas which are not well served by hotels have to travel a considerable distance in order to get the refreshment they require.
    The Under-Secretary of State for Scotland (Mr. Harry Ewing): Surely the hon. Member will recognise his difficulty in proceeding with this argument about drunken driving in relation to the fact that only hotels and clubs are open on a Sunday, because the highest incidence of drunken driving is on Friday and Saturday, when public houses, hotels, clubs and all licensed hotels are open. The lowest incidence is on Sunday.
    Mr. Rifkind: The Minister cannot have it both ways. At the moment, if only hotels are available for the supply of alcoholic liquor, those who do not live near them but wish such refreshment have to travel. If they are not within walking distance, the vast majority of people travel by car. This is so obvious that one need not dwell on it for any time. It is a direct consequence of the existing law, and the reason that certain bodies recommended that the change ought to be made.
    Mr. William Small: If Sunday opening becomes possible as a matter of law, will it then be illegal for any public house not to open on a Sunday?
    Mr. Rifkind: I am very glad that the hon. Gentleman asked me that question. I was intending to make this specific point. If the views of the Standing Committee are endorsed by the House, and if public houses are permitted to open on a Sunday, it is quite clear from the provisions of the Bill—and no one has taken exception—that it will be totally at the discretion of the licensee whether he wishes to exercise that right. If the hon. Gentleman and others wish to confirm this point, they should refer to Clause 55(5), which makes it quite clear that there is total discretion whether a public house or other licensed premises should be opened at any time during the permitted hours. It is totally discretionary. This point is important, because I believe, as I am sure many hon. Members do, that it would be quite wrong to force licensees or licensed premises to open irrespective of their own wishes on this matter.
    Mrs. Margaret Bain: Is not the position that many licensed premises are brewery-owned, and that therefore managers and families would be forced to work on their only free day?
    Mr. Rifkind: This problem is less prevalent in Scotland than south of the border for tied houses. It is not the same significance. As I think the hon. Lady will agree, nowadays it is very difficult to force people to work against their will. We have many examples of this in many walks of life. Any employer who sought to impose such conditions would be treated with very short shrift. I do not think that the hon. Lady need worry much about that. I do not believe that in present circumstances it would be likely to be a serious problem.
    Mr. Teddy Taylor: Would it not be very difficult for an employee to say to an employer "I do not want to work on Sunday" when there are 165,000 unemployed people? Would an employee be able to say to a brewery that he did not want to work on a Sunday and yet expect to keep his job.
    Mr. Dennis Canavan (West Stirling-shire): He should join a decent trade union.
    Mr. Rifkind: The simple fact is that those who do not wish to work on a Sunday would not need to do so. I do

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    not believe that licensed premises would have any difficulty in finding persons willing to work if so required, especially given the level of unemployment to which my hon. Friend the Member for Cathcart refers. But I do not think that this is a serious matter which should detain the House.
    Those of us who supported the amendment in Committee were very conscious that Sunday is a day with different characteristics and traditions compared with the other days of the week. It is for that reason that the amendment that was carried makes it quite clear that the permitted hours on a Sunday will not be the same as those on the other days of the week and will begin one hour later, to allow persons coming home from church not to be pestered or bothered in a way that might otherwise be possible. The hours in the evening are also different in order to take account of that.
    The Minister referred to his fall-back position and to the various safeguard clauses which the Government intend to move if their initial amendment fails. If we are to implement this change, which I believe to be important and desirable, there should be safeguards to meet the genuine concern that is felt by many people in Scotland and the problems that may arise as a result of such change.
    If the House rejects the Government's advice on the first group of amendments, most of my hon. Friends who supported the amendment in Committee and I shall be willing to support the Government's fall-back amendments, which afford safeguards. It is important to reach middle ground and to find a sensible compromise on this position. It is one which may easily be supported.
    12 midnight
    Mr. Nicholas Fairbairn: My hon. Friend dealt with the concept of the fall-back position. That seems to guarantee that where no public nuisance is created a publican is bound to be allowed a licence. In a tenement situation there would be a nuisance. In a village situation there would not be a nuisance. That is the absolute reverse of the requirement, is it not?
    Mr. Rifkind: If we read the amendment referred to, it is clear that the
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    licensing board is given a discretion to consider all the circumstances presented to it by the applicant and objectors and to take into account the usual criteria that affect all applications for licences. That is a reasonable approach to these matters. It will meet the legitimate problem.
    This provides an excellent opportunity for hon. Members representing Scottish constituencies to remove what the Secretary of State conceded was the present unsatisfactory situation of licensing north of the border. I say to hon. Members representing constituencies in England and Wales that this is an opportunity to provide for Scotland the same civilised licensing hours as the public south of the border have enjoyed for many years. However, I do not think that the Secretary of State's amendment would do other than continue an illogical, inconsistent and unsatisfactory system of licensing. For that reason I hope that the House will not approve it.
    Mr. Robert Hughes: I was disappointed that the hon. Member for Edinburgh, Pentlands (Mr. Rifkind) should have complained about the time when this business is being taken. One hon. Member suggested that we were faced with Hobson's choice. If we had wished we might have taken this business during the daytime next week. However, the balance of convenience for Scottish Members of Parliament was in favour of taking the matter this week, even at this time of night. That was generally agreed on both sides of the House.
    It was proper for the Government to put down an amendment to restore the position in the Bill. It ill becomes those who criticise the inability of Government Back-Bench Members to exercise a choice to say that the Bill was taken upstairs and that therefore there was no possibility of our properly discussing the matter by means of well-drafted amendments. With the best will in the world, and with the best advice, Back-Bench Members do not necessarily get the drafting right. That causes further confusion. I have no complaints about the Government putting down amendments to restore the position.
    The main burden of the Secretary of State's case is that the opening of pubs on Sundays would lead inevitably to some

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    measurable, or immeasurable, amount of alcoholism. To some extent he is making a judgment on how people become alcoholics. He admitted that there was an inconsistency. We may extend the hours on six days of the week and allow an extra six hours' drinking time, but apparently that does not have the same effect as opening on a Sunday. The Secretary of State made a relevant point when he said that the increase in alcoholism was related to the quantity of drink consumed.
    I am not a medical expert on alcoholism, but it is conceivable that people become alcoholics because their tolerance level rises and they gradually drink more and more until they become dependent upon it. The increase in alcoholism might be related to the extension of time by one hour a day. People may consume more each day because of that extension. But even that is arguable because we all know of the 10 o'clock "swill". The question is not clear-cut.
    Mr. Russell Johnston: Does not the hon. Gentleman agree that the operation of off-licences has a bearing?
    Mr. Hughes: It is bound to have a bearing. Although the Secretary of State gave figures of the overall increase in consumption of spirits, beer and wine, he did not suggest that that increase was accounted for only by consumption in pubs. Probably most of the increase in consumption has been in the home or in restaurants, where families drink with their meals more than they did in the past.
    The argument about alcoholism is to some extent fallacious. It takes us closer to prohibition, and hon. Members on both sides of the House may argue that the amount of alcohol available from all sources should be reduced.
    There have been considerable changes in drinking habits over the years. There used to be bona fide travellers, but that system was a nonsense and had to be done away with because the law was being abused.
    Mr. Tom McMillan: The abolition of the bona fide traveller rule in 1962 led to the horrible mess we have today. In 1962 a family could go anywhere at any time of day and get refreshment, but that system was
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    abolished and now we have boxes of drink.
    Mr. Hughes: I do not follow my hon. Friend's argument entirely. The old bona fide traveller rule was not intended for family drinking. I am satisfied that the bona fide traveller rule made the position more unsatisfactory than it is today. There is free access to clubs on Sundays. People are not supposed to drink in clubs unless they have been properly introduced and are well known to a member, but if we are honest we must admit that the strict letter of the law is not being followed in every club. It does not help respect for the law if we in Parliament pass laws but turn a blind eye to the fact that the laws are not being observed or enforced.
    There is certainly free access to certain hotels—those open for drinking—but even there the situation is not satisfactory because going into many hotels in Scotland is a bit of a crush. I am not satisfied that the civilised atmosphere for drinking for which most of us wish is present.
    One serious question has not been properly answered and that is about the staff involved in working on Sunday. They have to work six days a week and they look forward to Sunday off. They feel that they will be under pressure to work, and in spite of what has been said about it being easy to get people to work on Sundays, that may be so for the wrong reasons. It may not be the big pool of labour willing to work but the reverse—that the pressure of that pool of unemployed is on the present staff who feel compelled to accept work on a Sunday even though they do not want to.
    In that event, we have to accept that we cannot at all times decide the general law of the nation solely on the grounds of the inconvenience to one group. We have therefore to balance the inconvenience of one group against that of another. I seriously suggest to those working at this occupation that if they have not already done so, they should, whatever the circumstances, join a strong trade union and band together to ensure safe and reasonable working conditions. I would accept that the conditions in which most public house staffs work are intolerable. I do not believe that they

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    are properly paid or that they have proper working conditions. That is a remedy which should be open to them now and is not affected by this change, although I accept that they think it is.
    There is strong ground for relating some of the control to public nuisance. I would agree that the nuisance for people living above a public house is serious.
    On the second group of amendments, we should have to wait until 1977 before licensing boards can begin to consider applications and begin to enforce them on grounds of amenity and public nuisance. It may be dependent on how the House votes, but the Government can do something about filling in the position between now and 1977.
    My balance of judgment is that the convenience of the majority should rule. We should oppose the first group of amendments and the second and leave the Bill as it is. Having said that, I hope that the Government will find an in-between fall-back position on public nuisance. I do not believe that it can be covered in the way proposed today. This debate has naturally caused a great deal of public comment and passionate argument by those who sincerely believe that it is a retrograde step to open pubs on Sunday. [An HON. MEMBER: "It is the wee frees."] An hon. Member says that it is the wee frees. I am not a member of the wee frees or of any other Church, but it does not follow that I do not respect their views. They are entitled to them, just as I am entitled to disagree with them. One should not dismiss an argument because it comes from a particular source. We are faced with a serious problem about drinking.
    My balance of judgment is that the convenience of the majority overrides the possible consequences—which I do not believe will be as dire as has been predicted. We should leave the Bill as it was when it left the Committee.
    12.15 a.m.
    Mr. Teddy Taylor: The Minister was right when he said that this issue had aroused passions in Scotland. It has also encouraged some hon. Members to do some unusual things.
    The hon. Member for Berwick and East Lothian (Mr. Mackintosh) who is supposed to be the great architect of
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    Sunday opening, as well as a leading devolutionist, has sent an open letter to the newspapers appealing to English Members to help force through Sunday opening of public houses in Scotland, irrespective of the views of Scottish Members and the Scottish people. In addition, I found in a wastepaper basket, where I was depositing something else, a Whip sent out by one of my hon. Friends on the Front Bench urging English Members to vote.
    There is nothing wrong with English, Welsh or Irish Members voting if they have been here to listen to the arguments, but I object to the trendy hon. Members from both sides who look in occasionally to find out when we shall be voting and do not have a clue about the issue or the special problems of Scotland.
    I suggest to the hon. Member for Berwick and East Lothian and some of my hon. Friends that if we have Sunday opening forced on the people of Scotland by trendy English Members who have not been here to listen to the debate, we shall be doing a great disservice to the Scottish people.
    I see that the hon. Member for Rochdale (Mr. Smith) is here. He is entitled to vote because he has listened to the arguments, for and against. My hon. and learned Friend the Member for Thanet, West (Mr. Rees-Davies) may disagree with my views, but he has been here for the debate and I say good luck to him, let him play his part. However, it will be a shameful outrage if trendy Members come in and vote at the end of the debate just because they want to undermine another moral stance in Scotland.
    Mr. John P. Mackintosh: I shared a similar fear to that of the hon. Member, but I was concerned that a group of non-trendy hon. Members might come in to reverse a decision taken by hon. Members, from many constituencies, who were concerned about this matter. Would the hon. Gentleman not agree that we should like the decision to be taken by those who have listened to and taken part in the arguments?
    Mr. Taylor: The hon. Gentleman does not help to achieve that objective by sending an open letter to the Press. Not

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    does my misguided hon. Friend who sent out the Whip to English Members.
    One worry of hon. Members who are basically against Sunday opening is that it is anomalous to have overcrowded hotels on Sundays where people queue five deep at the bars, holding out £1 and £5 notes for drinks. I know that some hon. Members believe that we cannot allow that situation to continue but wonder whether, as with devolution, once we get on the slippery slope we shall be able to stop.
    I say to those hon. Members that there is a way. As a result of the veto legislation, mine is the only constituency in Scotland with no public houses, but that does not mean that the people of Cathcart do not drink. Some drink a lot and frequently. However, because of the way in which the law operates, one can drink only in certain places. One must be an ex-Service man, in which case one can drink at the British Legion Club; a member of the Labour Party can drink at the Labour Club; or a bowler can drink at one of the many very good bowling clubs in the constituency. There are also some licensed restaurants, including a very nice one called the Old Smiddy.
    Some people will say that this situation is anomalous. I have been to these places and although, as a teetotaller, I do not take drink, I have enjoyed myself there. We should not be facing the problem that we are now discussing if we had such premises throughout Scotland. Such places as these—the Labour Club, the British Legion and the bowling clubs—are places where a husband and wife can have a drink and something to eat and where they can have a good time in proper circumstances. There are many places such as that and I suggest that is what we should aim for.
    Mr. Martin Flannery: Although I am not a Scot I spent the war in a couple of Scottish regiments and I go to Scotland regularly to see friends. I always go up for a holiday during the summer holiday. I am appalled at the feudalism of the argumentation I am listening to from the hon. Gentleman.
    Mr. Deputy Speaker (Sir Myer Galpern): Order. I hope that the hon. Member for Sheffield, Hillsborough (Mr.
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    Flannery) is not going to make a speech. He is now giving us a history of his journeys in Scotland. He must make an intervention in the form of a question to the hon. Member for Glasgow, Cathcart (Mr. Taylor).
    Mr. Flannery: An intervention can be a tiny speech and that is what—
    Mr. Deputy Speaker: Order. Certainly not while I am in the Chair. Mr. Taylor.
    Mr. Fairbairn: On a point of order, Mr. Deputy Speaker—
    Mr. Deputy Speaker: Order. Let us get this point cleared up first. Has the hon. Member for Sheffield, Hillsborough completed his intervention?
    Mr. Flannery: I will complete it, Mr. Deputy Speaker. The point I am making in my wee speech is that it is an uncivilised practice to be unable to get a drink on a Sunday in a Scottish town. We should throw that idea out because it is feudal and backward and I am staggered to hear that kind of argumentation. That is my intervention, Mr. Deputy Speaker.
    Mr. Fairbairn rose—
    Mr. Deputy Speaker: Order. I am calling Mr. Taylor. If the hon. Member for Glasgow, Cathcart, wants to give way he can do so.
    Mr. Fairbairn: On a point of order, Mr. Deputy Speaker—
    Mr. Deputy Speaker: I am sorry, I did not hear the hon. and learned Member for Kinross and West Perthshire (Mr. Fairbairn).
    Mr. Fairbairn: I was dismayed and upset just now, Mr. Deputy Speaker. Could you rule on the meaning of the word "argumentation" because it does not mean anything to the Scots although it may mean something to the English?
    Mr. Deputy Speaker: I think that we are too sober at the moment to rule on that word. Mr. Taylor.
    Mr. Taylor: I would say to the hon. Member for Sheffield, Hillsborough (Mr. Flannery) that we should not just make laws for our tourists. We should make laws for the people who have to live in Scotland for 52 weeks a year and seven

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    days a week, some of them living in pretty appalling housing conditions. Had the Government approached this Bill with that intention—unfortunately they have not—and had they tried to do something to change the character of Scottish drinking—they have not—I would not have been opposed to reform. But all the Government are doing is extending the hours of drinking and basically nothing else at all.
    In the present anomalous situation we have hotels sprouting up all over the place, and in the most unusual places, where people certainly would not want to go to spend a holiday or even a night. Some of the owners might drop dead if they were asked for a room. This anomalous situation has arisen because of those who want change. Such people argue that we have tycoons coming from Chicago and flying from Dusseldorf who want to drop off in Scotland and build a £20 million factory in the constituency of the hon. Member for Central Ayrshire (Mr. Lambie). It is argued that if those people do not get a drink on Sunday they might not build their factory. Now it is suggested that if we let such a person have a drink he should sign a paper stating where he is going to and where he came from.
    It is also argued there are many parts of Scotland where drinking is not a bad problem. I was in a town recently where there is a hotel with a bar open on Sunday. It is not overcrowded and it is a pleasant place to drink. It was called the Kingsley Hotel in Brodick. There are many places such as this. I am sure that even the hon. Member for Roxburgh, Selkirk and Peebles (Mr. Steel), who leads the Liberal Party, would agree if he listened a little more closely to what I am saying. Is this such a crazy situation? I believe that it will sort itself out. There will be more hotels and clubs. The standards of these premises will he much better than those of the hell holes.
    Under the Bill, what incentive is there for the latter to improve? An appalling hell hole can make a fortune by packing in men, standing at the bar drinking themselves silly and drinking their families into appalling financial trouble. But if a nice hotel or club were allowed to open for seven days a week, there would be an incentive for improvement.
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    The situation may be anomalous now but it is improving. We are getting more hotels and clubs. With time and pure capitalism, demand and supply will come together and drinking conditions will improve in Scotland.
    Mr. Robert Hughes: The hon. Member has a nerve to say that beneficent capitalists will in time improve the drinking situation in Scotland. He has just talked about the hell holes that the working class have had to suffer. That is capitalism for him, and he should not forget it.
    Mr. Taylor: I was talking about the law of supply and demand. If with proper legislation we allow it to run its course, better premises will emerge. But if we simply do what the hon. Member for Berwick and East Lothian wants, we shall have hell holes open seven days a week, making a fortune and with no incentive to improve. That is what the supporters of Sunday opening are doing.
    The way to improve the situation is to maintain the status quo and to encourage more places where people can have a meal and entertainment with their drinking. Will the changes which are being suggested make the situation better or worse? The Secretary of State made a fair speech. Every reasonable person must accept that with more opening hours—whether late at night or on Sunday—there will be more drinking, and more drinking means more alcoholism and more human misery.
    What evidence there is suggests that in every country—there are recent examples from two States in Australia—which has liberalised its drinking laws there has been an increase in alcoholism and drunkenness. A perfect example is the one we shall probably get from the hon. Member for Berwick and East Lothian. That is the example of France, where anything goes. Even the Clayson Report said that the problem of alcoholism was worse in France than in Scotland—and that is saying something.
    Mr. Russell Johnston: Would the hon. Member explain—I do not know the answer—why Italy and France, which both have the same liberal licensing laws, have entirely different alcoholism rates? It is very high in France and very low in Italy.
    Mr. Taylor: As I think the right hon. Lady the Member for Lanark (Mrs. Hart) has said, the answer probably lies in the different methods of diagnosis in the two countries. Taking that into account, I do not think that the picture is very different.
    All the evidence is that this great change will mean more drinking, which will be bad for Scotland, where too much is drunk anyway.
    Nor can I understand the argument of the supporters of Sunday opening that it would make us more like England. Apparently the character of our pubs will change, and instead of people standing against the bar getting drunk, we shall see the vicar, the undertaker and the squire sitting around the old oak tree drinking half-pints of cider and engaging in improving conversation. That will not happen and there is no evidence to suggest that it will.
    12.30 a.m.
    If there is any doubt whether Sunday opening will mean more drink, I would ask those who support it to explain why the brewers also support it. Why is the licensing trade supporting the clause? Is it composed of altruistic people who want to involve themselves in extra expense by opening on Sunday, having to pay double time to their employees, and more money on heating and lighting so that they may sell less drink? Of course not.
    Mr. Harry Gourlay: Is the hon. Gentleman suggesting that if we had prohibition we would eliminate alcoholism? If so, who would then pay for our schools, roads, hospitals, and so on?
    Mr. Taylor: If the hon. Gentleman is suggesting that the brewers enable us to provide more schools, roads, hospitals, and so on, through the taxes that they pay, it is true that they provide a great deal by way of taxes. But I am not suggesting that we should have prohibition. Certain people are suggesting that we should have a change. I submit that they must prove their case for change. If we change in the way suggested, there will be more drinking, alcoholism and misery. Is there any evidence that the suggested change will not mean more drinking, alcoholism and misery? Far from it.
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    I was making the simple point that any business man—a brewer or anyone else—would be foolish if, for other than spiritual or altruistic reasons, he suggested a change which would mean his making less profit and having more expense. Yet that is the suggestion. I wonder why. Are such people acting out of pure decency because they want to encourage less drinking? If so, why are they spending fortunes advertising on television to persuade people to drink more of their particular brands? [Interruption.] I am sorry. I did not catch that.
    Mr. Deputy Speaker: Order. We cannot have sedentary interventions.
    Mr. Taylor: I think that I have dealt with some of the arguments that have been put forward by the pro-Sunday lobby.
    This is not just a problem of drinking. There is more to it. Undoubtedly, Sunday opening of pubs will mean another significant change in the style of life in Scotland. The Minister referred to alcoholism, but we have many other problems: marriages breaking up, children being abandoned, and so on.
    A stable feature of our society has been having Sunday as a day not necessarily for religion but for people visiting their families—their grannies. That is a good thing. It is not something to be laughed at. It should be encouraged. Sunday is a day for people visiting their grannies, uncles, and other relatives.
    If one goes into any public park in Glasgow on a Sunday, one will see fathers taking their families for a walk. [An HON. MEMBER: "Probably taking them for a drink."] That may happen if this clause is not accepted. But a father with two children aged six and four cannot very well take them for a drink, even in an English pub, and I would not welcome it.
    I am sure that you, Mr. Deputy Speaker, representing a Glasgow constituency, will agree that it is a good sight on a Sunday to see the Glasgow dads out with their kids in the parks. That is something that we should encourage. I believe that the opening of pubs on a Sunday will discourage that practice. It will change our style of life for the worse.

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    There was a time in Scotland, when religious meant more than it seems to mean today, when almost everyone went to church on Sunday. That does not happen now. Some people say that this is a matter of liberty and freedom. What freedom will anyone living in a tenement above a noisy pub have from drunks who emerge at closing time? Will they have the freedom to have a quiet Sunday or a Scottish sabbath if they choose to have it?
    It is all very well to speak of freedom if one represents a country area or lives in a pleasant suburb of Edinburgh. But there is no such freedom for those who live in most appalling housing conditions in Glasgow. I do not think that any Government, faced with our financial problems, will be able to solve our housing problems for many years to come.
    If Sunday opening is accepted, those who now for six days a week have to put up with appalling misery, inconvenience and affront from what goes on outside pubs will have to put up with those conditions for seven days a week. There will be no advantage for them.
    I believe that the proposal for Sunday opening is part of a general pattern of change in the accepted standards of our community. We have had many liberal reforms. The suggestion is that this change will make things better, not worse. We have had abortion reform, a soft policy on crime, and so on, to create a freer, more liberal and just society. But, despite those moves, we have had declining standards in all areas. I wonder whether we should take a further step.
    If the House finally agrees that it wants Sunday opening we shall find that people in some areas in Scotland do not want to accept the threat that that will present to their standards. Is it right or is it wrong that we should—in every part of Scotland, irrespective of the views of the people who live there—force Sunday opening upon them? The hon. Member for Birmingham, Selly Oak (Mr. Litterick) is a supporter of worker-participation and industrial democracy. Does he believe that it is democratic for Parliament to insist on Sunday opening even in the several areas of Scotland where the people believe that it will upset their standard of life?
    Mr. Litterick: The key point is choice. It is not about whether the House is forcing people to drink but whether we afford to the people of Scotland the right of choice to drink on Sunday. This is democracy and it is Stalinist to suggest that humanity will not behave itself unless it is encased in iron, rigid laws imposed by an authoritative Parliament, or anything else which chosen to make such laws.
    Mr. Taylor: The hon. Gentleman might believe that if it were a matter of Rousseau, individual liberty and people being able to enjoy freedom. But if he visits Glasgow he will see that some freedoms affect the freedom of others. It is impossible to have the individual freedom of choice between Sunday drinking and spending the day quietly with the family or taking part in the Scottish Sabbath. If the pubs in Glasgow were open on Sunday there would be no freedom for anyone else.
    I hope that we shall take the right decision. The hon. Member for Aberdeen, North (Mr. Hughes) believes that Sunday opening will not lead to more alcoholism. I hope that he will read the report of the professor who spoke on the radio on Saturday and who was reported in the Press the same day. He was talking of the argument on pornography, that if we took away restrictions people would find restraint removed and there would be a reduction in the number of sexual crimes. Evidence from other countries has shown that the removal of such restrictions has led not just to a steady rise but to a dramatic rise in such crimes.
    Mr. Fairbairn: Will my hon. Friend tell the House what has been the rise in sexual crimes in Scotland over the past five years? In fact, the number has fallen every year.
    Mr. Taylor: We have not had the type of change experienced in countries such as Sweden. I hope that the House will support the Government in their clause and its consequential amendments. I say to hon. Members "For goodness sake be convinced that it will be beneficial for Scotland before you vote for any change." We have voted far too often for change without thinking through the consequences and we are in danger of doing that tonight. Hon. Members should consider whether it will make things better or worse for Scotland and its people if

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    public houses are open on Sundays. I say, unhesitatingly, that it will make things worse and that therefore we should vote "No" to Sunday opening.
    Mr. Mackintosh: The House will be grateful to the hon. Member for Glasgow, Cathcart (Mr. Taylor) and my right hon. Friend the Secretary of State. Between them they have put the nub of the argument against Sunday opening. It is now clear what the argument is. I hope to meet it head on.
    The hon. Member for Cathcart, though absolutely genuine, has it all wrong. For example, he says that because there is more consumption of alcohol things must be worse. Since I first went to my constituency 13 years ago one noticeable and enormous change is that men now take their women and wives with them when they go out in the evening. The inevitable result is that more is drunk, but it is drunk by more people, by the wives as well as well as by the husbands.
    The House was asked why the interests concerned bother to advertise in the Press. It is because they want to persuade more people to go out to entertainment where alcohol is available. If a man, instead of drinking a number of pints himself, takes his wife to a social function or a properly-appointed club where entertainment is provided, and they both have drinks, more may be consumed in total, but there is no evidence that behaviour is worse.
    Hon. Members on the Labour Benches should beware of this argument. It is exactly the same as we heard so often about motor cars. They were objects which used to be owned by a few privileged people. Now they are owned by many. The result is that the number of accidents on the roads has gone up, but people all enjoy motoring on a Sunday. The fact that there are more accidents, that more cars are sold and that the manufacturers advertise motor cars does not mean that the spread of motor cars is of itself bad. The same applies to obesity and the consumption of steaks, which has increased.
    Mr. Robin F. Cook: Before my hon. Friend gets carried away, may I ask him to return to the point with which he began? It is true that one of the marked trends of the past decide is that more women are
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    drinking. Another marked trend is a much bigger increase in alcoholism among women than among men. The very trend to which my hon. Friend is pointing is strong support for the argument that increased consumption inevitably produces an increased incidence of alcoholism.
    Mr. Mackintosh: I am grateful to my hon. Friend for that intervention. If women drive, some women will have motor car accidents. We are discussing total behaviour patterns. Anyone who has looked at the social history of working-class areas in Scotland will agree that the total behaviour pattern in pubs and clubs today is far better than it was 10, 15 or 20 years ago. I distinctly remember that when I was a student people would not walk through Grassmarket in Edinburgh at night. When one went past certain pubs one would see people lying in the gutter. There were similar scenes in Glasgow. One does not see them today, because the behaviour pattern in those places has improved enormously over the period that the drink laws have been liberalised.
    People's total conduct has improved. The fact that a certain number of people become alcoholic is not an argument against the better facilities, the better atmosphere and the better conduct that has prevailed in Scottish public houses and clubs in the past 20 years, when the whole approach to the matter has been liberalised.
    My right hon. Friend and the hon. Member for Cathcart made the position clear. Their point is that alcoholism is a serious problem in Scotland. We agree. Secondly, they argued that opening the pubs on Sundays would make the situation worse. That is the nub of the argument. They will admit that it is not logical. The hon. Member for Edinburgh, Pentlands (Mr. Rifkind) put his finger on the illogicality. The Bill is a liberalising Bill, extending hours, making it easier to drink. If my right hon. Friend's argument were correct, he should not be introducing the Bill. He should not be lengthening the drinking hours.
    My right hon. Friend is apparently saying that he is not allowing people to get drunk on Sundays. Anyone can get drunk on a Sunday. He can go to a hotel

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    or he can buy the drink in an off-licence on the Saturday and keep it until the Sunday. He can go to a working men's club or a yachting club. I remember joining a yacht club where one did not have to yacht. There were two categories of member—yachtsmen and drinking members. There is no problem about getting drink on a Sunday.
    12.45 a.m.
    What the Secretary of State is saying is that if we open the pubs in Scotland on a Sunday, there will be a categorical difference from the availability of drink at the moment, or from the extension of hours on weekdays. He is admitting that his case is totally illogical. I suspect that there is a symbolic element in it, and that is why I thought the hon. Member for Cathcart put his finger on that case. It is that by opening the pubs in Scotland on a Sunday and making more drink available we shall somehow tilt the balance in the direction of an approach to drinking fundamentally different from the present approach. In a sense that is the key to the argument. It is a symbolic case which does not have a great deal to do with the availability of alcohol.
    If one accepts that more drink means more alcoholism and that having easier hours means both, the logic of that argument is prohibitionism. That argument has been advanced in Scotland for 100 years and is the origin of the temperance and prohibitionist type of licensing laws that we have had in Scotland since the First World War. The logic of the idea is that unless we make it difficult to get drink, people will abuse drink.
    Mr. Millan: The logic on the other side is that we keep the pubs open for 24 hours a day. I do not think that anyone in the House wants that.
    Mr. Mackintosh: I shall deal with the logic of that argument in a moment. Let me first stick to the prohibitionist argument.
    The prohibitionist argument is that if it is made as difficult as possible to get drink and if the circumstances are made as nasty as possible, there will be less drinking. If the hon. Member for Cathcart wants to know, I can tell him that the hell holes in Scotland were created by the licensing laws, because those laws
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    prescribed that there should be such conditions.
    Mr. Teddy Taylor: Rubbish.
    Mr. Mackintosh: It is set out in all the histories of the subject. There was a prohibition on entertainment; there was a prohibition on seating accommodation; there was a prohibition on hours. The prohibitions made the pubs so unpleasant that, although not themselves prohibited from going into them, women kept out of them because only prostitutes would go into such places. I remember when pubs had notices saying "No ladies served", because only women of a certain kind would go into a pub. That was the logic of the whole prohibitionist case. Let us be clear—it has failed totally, for alcoholism is on the increase in Scotland and the present laws must be to blame, because it has happened despite the present laws.
    The opposite logic is that adopted by the Clayson Committee and the Guest Committee and by others who have made reports on this subject. It is that if we liberalise the laws and change the atmosphere, there will be an increase in consumption, but there will in time—and this is where the hon. Member for Cathcart had a point, because it will not happen at once—be a change in the approach to drinking so that it will be treated as a family matter and as a social matter and will become socialised.
    This takes me back to what I said at the beginning of my speech. Compared with 15 or 20 years ago, many more younger men go out with their wives and families and their behaviour pattern is totally different. Teenage drinking is very important, but the modern approach is not understood. If a young teenager wants to buy a drink, all he does is to get a friend who is over 18 to go to the off-licence where he can purchase as much as he likes and they go to a friend's house where they can drink themselves silly in a private room. That is the kind of behaviour that we want to stop, but it is perfectly possible under the present licensing laws and it is happening all the time.
    What is much better is for them to be encouraged to go to a pub where they will meet their friends and their neighbours and other adults and where they will be in a social environment that will

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    encourage proper behaviour and where bad behaviour will become something that the neighbourhood knows about and ridicules and looks down upon. That is ultimately the manner in which we shall control teenage drinking, not by making it a secretive and furtive thing.
    The hon. Member for Cathcart asks what will improve the hell-hole pubs. They will be improved by competition. I would have thought that he would accept that. If they are allowed to open on Sunday they will compete with the hotels. The hon. Member wants to retain the present anomalous position. Yet in the Scottish Grand Committee he described these hell holes as places where people were packed five and six deep, waving £1 and £5 notes in dreadful grotty conditions. He wants us to preserve that situation.
    Mr. Teddy Taylor: No. I said that this would change by having more hotels with better conditions. If we allow the hell holes to open on Sunday they will make more and more money. The present situation means that there will be more and more good hotels to drink in on Sunday.
    Mr. Mackintosh: But the hon. Member for Cathcart is making my point for me. Why should people go to these hell holes if there are more good hotels with better amenities? The hell holes will have to compete with these good hotels. When he talks about nuisance under the present law, he must realise that the nuisance is transferred. People who live on top of these so-called hotels have their amenity ruined on a Sunday.
    Mr. Teddy Taylor: Who lives on top of a hotel?
    Mr. Mackintosh: I am surprised that the hon. Member does not know that there are many tenements in the centre of Edinburgh in which the ground and first floors are the hotel, and people live above it and on both sides of it. People pour out of hotels like this at 3 o'clock in the afternoon, and those who live around them lose their amenity.
    The hon. Member claims that having fewer drinking places on a Sunday will improve the situation. I find that a very surprising argument. We want to encourage competition and to raise the
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    standard of conduct and amenity in hotels. That has happened over the past 15 or 20 years with the liberalisation of the law. The final step is to open pubs on Sundays and to enable people to choose the places in which they drink—places with decent amenities and plenty of sitting room where they can take their families and where they will have the opportunity for the kind of civilised conduct we all want.
    The present anomaly of the club or hotel is a gross geographic and class unfairness. In my constituency in the working towns and villages there are the clubs where drink is available on Sunday. In the commuter areas from Edinburgh are some admirable and some not-so-good hotels for people who drive and drink. The places which are penalised are the attractive little villages in remote areas where the drinking places are genuine pubs. People in these villages have to drive up to 20 miles to a so-called hotel to get a drink on Sunday. This is gross unfairness. It is an odd thing to say to someone in a remote village on the Berwickshire border "You cannot have a drink here, but it is available a few miles across the river in Northumberland." No one has yet proved that there is greater crime, wife battering or evil in Northumberland than there is in Berwickshire.
    I urge the House to retain the Bill as it was amended in Committee. I am very unhappy about the fall-back position. I do not think that it will lead to better standards or less nuisance. The Secretary of State has not distinguished between good quality pubs and second quality pubs, but he says he will draw a distinction on the grounds of nuisance. If there is a nuisance it should not exist at any time during the week. We do not want two qualities of pubs. Therefore I urged the House to reject both those amendments.
    Mr. David Steel: Like everyone else I make it clear that I speak for myself and not for my colleagues on these matters. Those of us who were not on the Standing Committee should be grateful to the Secretary of State for the way in which he has set out the options open to us in the debate. I found the groupings of the amendments extremely confusing He has made clear in an open and candid

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    way just what choice is open to the House.
    I am surprised that there has not been a greater sense of outrage among hon. Members at having to begin this series of debates at such a late hour. I am not a party to any hole and corner agreement made between the Opposition and the Government, but I do not believe that our English and Welsh colleagues would have tolerated such a situation in which a major reform of the licensing laws was being conducted through the House with more than 100 amendments beginning at nearly midnight. The hon. Members for West Lothian (Mr. Dalyell) and Aberdeen, North (Mr. Hughes) are always railing about devolution, but they should learn from this that in an overcrowded legislative programme Scottish legislation will be relegated to this sort of position.
    Mr. Millan: The choice of timing was between this week, next week—and next week would not have been suitable for Scottish Members—or leaving the matter until after the Summer Recess, which would have endangered getting the Bill at all. But if hon. Gentlemen are going to complain about this matter they should be more frank with the House. The Liberals, for example, were asked to nominate a Member to the Standing Committee but they refused.
    Mr. Steel: I do not see that the Secretary of State's last point has anything to do with the argument. I am talking about the right of the House to debate this matter. I am totally unmoved by arguments about choices which were never put to me or my colleagues and which may have been discussed through the usual channels. The main point is that it is grossly unsatisfactory that major legislation, particularly legislation which is not a party matter but on which hon. Members have to make up their own minds, should be discussed at this time of night. I do not understand how the Secretary of State can seek to defend the situation with the sort of lame excuses he has put forward.
    Mr. Tam Dalyell: The hon. Gentleman must be fair about this question of the handling of Scottish legislation. The requirements vary vastly in different parts of Scotland, for instance as
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    between the Western Isles and the Lothian Region. I was always in favour of doing it through the regions and not through Parliament at all.
    Mr. Steel: No doubt the hon. Member will make that point many times in the future, as he has in the past.
    Two novel constitutional points were advanced in the debate, first by the Secretary of State, and almost echoed by the hon. Member for Edinburgh, Pentlands (Mr. Rifkind). It was the first time I ever heard a Minister say in a debate on a Scottish Bill that he hoped that the English and Welsh Members had left so that we Scots could decide the matter by ourselves. That is a very strange concept because the logic of it is—and I would support it—that we should long ago have devised some method of taking Report stages through the Scottish Grand Committee with only a final reserve power left to the House.
    The hon. Member for Pentlands advanced the novel concept that we should pay very close attention to the 10 to six vote in Committee, and not lightly overturn it. Anyone can do arithmetic. A 10 to six vote means that those who won were dependent on only two Members taking a different view. If it had been eight—eight, the Bill would have stood as it was when the Government presented it. I do not think that on Report we can take carte blanche the views of a Committee that might have depended on the opinions of only two persons.
    On Sunday drinking—
    10 a.m.
    Mr. W. R. Rees-Davies: Is the hon. Gentleman seeking to argue that English Members, who may have had long experience of the licensing laws and their operation in England and throughout the country, including Scotland, are to have no voice in this matter? The tourist industry is of the greatest importance to Scotland and the whole of Britain. There have been two contemporaneous reports—namely, the Erroll Report and the Clayson Report. Some of us gave evidence to both committees. In fact, I did. I venture to submit that there is a strong case for seeking some guidance from what is happening under the English licensing laws, even though Scotland may wish to differ in its views.
    Mr. Steel: The hon. and learned Gentleman's speech will have been noted with interest. I am not suggesting that English and Welsh Members should not have a vote, least of all those such as the hon. and learned Gentleman who have been listening to our discussions. I was criticising the concept that appeared to be suggested by the Secretary of State—namely, that he hoped that Members such as the hon. and learned Gentleman had gone home.
    I turn to Sunday drinking. I am instinctively opposed to any state of the law founded on hypocrisy. I accept that much of the present legislation on Sunday drinking is founded on hypocrisy. We know that it is possible to obtain drink in an hotel on a Sunday. That is a place that happens to have bedrooms sufficient to satisfy the licensing court. Whether the bedrooms are ever let is an entirely different matter. Equally, drink can be obtained on a Sunday in a club. I should not be opposed to a limited extension of Sunday drinking for public houses which were clearly to be places of genuine social resort, but I am opposed to a wholesale extension for places which will merely cater for drinking for the sake of drinking throughout a day when most people are not working.
    That is the difference between England and Scotland. I accept what is said by the hon. Member for Berwick and East Lothian (Mr. Mackintosh). The drinking houses of Scotland have improved over the past 10 or 12 years but they still lag behind the standard of public house that is common south of the border. Every time that I visit public houses south of the border with my family, which is not frequently, I am struck by the fact that they are different in character and ambience and in the facilities they provide for the family. That is one of the reasons for there being such a difference in the rate of alcoholism between England and Scotland.
    Drink in an English public house is incidental to a form of social activity whereas there are too many institutions in Scotland which still to this day exist for the purpose of the intake of alcohol. There is that great difference between the two establishments.
    The Bill as it stands implies a wholesale extension of drinking on a Sunday
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    that I cannot accept. Nor do I accept, although my hon. Friend the Member for Inverness (Mr. Johnston) does, that the matter can be tackled by the veto poll. I believe that the law of the land must be the law throughout and should not vary from place to place according to local whims. I remain instinctively opposed to the wholesale uncontrolled extension of Sunday drinking. There is much to be said for the fall-back position that the Government have taken, even though I am not entirely clear about it at the moment. However, it seems to open up the possibility of the licensing court extending Sunday opening only to those places that will provide a genuine facility for the community without irritation to the rest of the population.
    Mr. William Ross: I hope that I may be permitted a few words as one who was more or less responsible for the layout of the Bill. I say at the outset that we are discussing this matter in isolation. Many of the English and Welsh Members who are here will be considering these matters only in relation to Sunday opening, forgetting that the Bill was a balanced approach to the Clayson Report. We cannot consider Sunday opening without taking into account all the other things that have been done, and what the Secretary of State and the Church of Scotland have rightly said is a liberalising Bill. Do not think that the Church of Scotland approved of everything in the Bill. What it said was that the
    "proposals for a Bill includes some mistakes, Indeed, it could be a mistake not to wait, having waited so long, until Parliament has devolved this purely Scottish matter to an Assembly".
    I point out, incidentally, that the Erroll Report was made a year before the Scottish report and that nothing has been done about it. We are always told that we are fairly lax in Scotland, but we looked at the Clayson Report. As the Church of Scotland says, there were some things that it did not like. There was the question of the veto poll, and what was highlighted about extensions during the week, relating to the hasty drinking and the possibility that this led to drunkenness. We accepted some of that.
    What the Church of Scotland eventually said was that
    "taken as a whole Mr. Ross's approach is that of a responsible realist. Certainly there

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    is nothing in his proposals which should prevent what we desperately need in Scotland: a spirit of true liberalism and true temperance".
    We were lectured on the history of licensing in Scotland. What we have, in fact, is certification. Before the First World War, in the period 1902 to 1910, there was a proliferation of hell holes and drinking dens which were a scandal to the whole country. Hon. Members should not read the Scottish report. They should read the English report. The Erroll Report says that
    "it is instructive to consider the various trends in the level of problem drinking and the number of outlets at these points in time. The period 1910–1920 coincides with a very considerable drop in the consumption of beer and spirits: in offences of drunkenness: and in death rates due to or associated with, alcoholism. The decline in the number of retail outlets was also very obvious during this early period."
    That was as a result of the introduction of licensing. It had that effect. The report adds:
    "We conclude that this is one case where changes in the law relating to the number of outlets, permitted hours and conditions of sale may have had a perceptible effect."
    It does not mean that at all times they will have this effect. We have to be very careful in suggesting that we can do everything by the licensing system. The licensing system was essential after 1910, and during the War it was tightened very considerably, with the same beneficial effect.
    Mr. Mackintosh: During the period after 1902, and also after the First World War, when it was put again and again to the Scottish Licensed Retail Traders' Association that Scottish pubs were much less satisfactory than those south of the border, it quoted laws which prohibited the number of seats in pubs, prohibited entertainment and the provision of meals, and prohibited many of the things which were spreading in England and which changed the character of English pubs.
    Mr. Ross: The restrictions did not last all that long a time, and my hon. Friend should not mislead the House in relation to the number of seats. There has always been some form of prohibition relating to entertainment, but there have been considerable changes in that respect.
    My right hon. Friend the Secretary of State talked of a fall-back position, but
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    if something is a nuisance on a Sunday it is equally a nuisance on Monday, Tuesday, Wednesday, Thursday, Friday and Saturday. I have known many cases of people complaining of sound amplification and the sound of so-called entertainment. It is one of the curses of the modern pub. For the people next door or in the immediate neighbourhood it is a question not only of alcoholics at closing time but of what goes on all the time in the way of excessive noise.
    When we discussed this matter in the Scottish Standing Committee in 1962 we moved away from the concept of the bona fide traveller in hotels and made considerable changes. The same proposition to open pubs on a restricted basis was put forward. A Conservative Government were in power at that time. John Maclay was Secretary of State for Scotland. The Under-Secretary was Mr. Brooman-White. He accepted the illogicality of the position but said that it would be quite wrong to open public houses on Sundays. He was referring to an official Conservative amendment which was supported by the Leader of the Tory Party in the Scottish Committee. There was a vote of six to 10 against, in a Committee of 21. That was not exactliy an overwhelming indication to the House of Commons that we should accept this proposal. The Minister said that he would rather have drinking associated with eating. However, he moved an amendment to open places where there would be no eating—that is, in public houses.
    Let us recognise that the drinking habits in Scotland are different from those in England. What the Scots drink is different.
    At paragraph 1.17 of his report, Clayson said:
    "The evidence available to us is admittedly incomplete but we have no doubt that Scotland suffers from a serious problem of alcohol misuse, both absolutely and in comparison with England and Wales."
    Clayson deals with the quality and nature of drinking at paragraph 1.24 of his report. He says that the more retail outlets there are, the greater the difficulty with abuse.
    Reference was made to the fact that the alcohol problem was related not to drinking in unlicensed premises and clubs but to drinking in the home. One

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    of the big changes we made in 1962 related to off-licence premises. I should like to know the figures. It is the easiest matter in the world to obtain a licence for off-licence premises in Scotland today. That is one of the biggest gaps in controlling drinking, especially that of young people. That may surprise some of my hon. Friends.
    The most disturbing rise in the incidence of alcoholism occurs among young people between the ages of 24 and 34 and, next among those between 35 and 44.
    Mr. Hugh McCartney (Dumbartonshire, Central): I should like to take up my right hon. Friend's point that the greater the number of outlets for alcohol the greater the incidence of alcoholism. I subscribe to the support of those engaged in the rehabilitation of alcoholics. The Secretary of State for Scotland said that the highest incidence of alcoholism occurred in the Highlands. That includes bothy drinking. That area has the fewest outlets for the sale of alcohol. It has the greatest number of restrictions from the point of view of Church morals. How can my right hon. Friend equate those facts?
    1.15 a.m.
    Mr. Ross: The statement I made is supported by research which enabled the Clayson Committee and the Erroll Committee to draw up their recommendations. As to the Highlands, the quantitative as well as the qualitative nature of the drinking should be taken into account.
    The Clayson Committee skated lightly over one problem, which it handed over to the Scottish Education Unit. I am sorry that the Leader of the Liberal Party has gone. He might have been able to help me. The firm doing the publicity for the Scottish Education Unit was also doing the publicity for the Scottish Whisky Association. Perhaps the Leader of the Liberal Party was a director of that firm at the time. In any competition to determine patterns of social behaviour the distillers will come up with far more money than will the Government through the education unit.
    Considerable changes occurred in 1962. There are now far more off-licences and hotels with licences than there were. Public house drinking tends to be not family drinking but male drinking. For years
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    I have heard this tale about civilised drinking hours. In 1962 it was said that it would improve pub premises. My hon. Friends in Committee who support the Sunday opening of public houses referred to public houses in Glasgow which should have been closed down.
    Mr. David Lambie: My right hon. Friend that that public houses in Scotland were still male drinking places. When was he last in a public house in his own town of Ayr?
    Mr. Ross:I have the evidence given by my hon. Friends in Committee.
    Mr. Lambie: Answer the question.
    Mr. Ross: I do not know that I have ever been in a pub in Ayr in my life. My hon. Friend suggests that I know nothing about pubs, but I do not come from a teetotal family. I know about the state of pubs from what people closely related to me have said. My father-in-law was a member of the licensed trade and a hotel-keeper. I know what goes on from what was said in Committee. One cannot pass through Glasgow without seeing the hell holes.
    Mr. Lambie: What about Ayr?
    Mr. Ross: I am not concerned with Ayr. The city pub in Scotland is where men drink. They do not take their wives. That is the tradition, and pubs are the last places that should be opened on Sunday, which still has a special place for a great many people in Scotland. One place I am at on a Sunday is church. The church to which I used to go is almost surrounded by public houses. It would be offensive to many in Scotland to be subjected to that and to know that it was going on. I hope that we do not lightly pass over the question of the Sunday. The Scottish Sunday is different. Its difference is appreciated and we should retain that.
    It used to be said that we should liberalise for the sake of the tourists. I hope that we shall not be kidded by that argument. People do not come to Scotland or stay away because of the licensing laws or the drink.
    I hope that it is appreciated that the change we would be making is very serious. I am sure that the majority of people in Scotland who like a drink are not in favour of opening the pubs on a

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    Sunday. I ask hon. Members to bear that in mind and that the Scottish Sunday and its tradition as a family day, as well as the tradition that it is a day of rest, are worth cherishing. When we consider the effect—
    Mr. Gerard Fitt: If my right hon. Friend will forgive my intervening in a regional debate, after sitting last Friday evening with not many Englishmen, Scotsmen or Welshmen listening to the problems of Northern Ireland, I am delighted to see so many Welshmen, Englishmen and Irishmen here with the Scotsmen to hear the right hon. Gentleman's views and the ifs and buts about this matter. Many Scots hon. Members have obviously gone out of their way to be here tonight to debate the pros and cons. Is my right hon. Friend prepared to accept the verdict of the Scottish Members? He has talked of the Scottish Sunday and the Scottish sabbatarian attitude. He is a representative of Scotland and may not like interference by Englishmen and Welshmen, but he is prepared to accept the verdict of Scottish Members, whether they are for or against drinking?
    Mr. Ross: Of course I am prepared to accept the outcome of the vote, whether it be by Scottish Members or by the whole House, but I do not like it to be done by using an English majority. In the reorganisation of local government I was concerned that we had Strathclyde wished on us by the Conservative Government by the votes of English Members. The majority of the Scots Members voting then were against it.
    Mr. Fairbairn: Since he has forced on the English agricultural community the abolition of the tied house by the votes of Scottish Members, I do not see the right hon. Gentleman's complaint.
    Mr. Ross: I am not complaining. I am prepared to accept the vote of the House, but the people who vote should vote out of conviction and should realise the importance of this to Scotland.
    The Secretary of State's speech was clear and lucid and pointed out the difficulties of the licensing system. He pointed out the changes made and said that there comes a point at which one must not take chances on our knowledge of drinking habits.
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    I shall vote with the Government on the new clause and I hope that it will not be necessary to rely on fall-back positions which will not prove satisfactory in the end.
    Mr. Donald Stewart: My remarks will not commit my hon. Friends. As in other parties, some will support my views; others will be against them.
    Most of the legislation introduced into this House has substantial backing. Even if it is derived only from a statement in a manifesto, the Government will have the support of their own Members, but I wonder where the demand for this legislation arises. No one in my constituency or in any other part of Scotland where I am known has said that it is appalling that we do not have Sunday opening and that Parliament should do something about it.
    The hon. Member for Glasgow, Cathcart (Mr. Taylor) said that brewers were in favour of the Bill, as amended, but from the soundings that I have made, I know that managers and owners of public houses have great anxieties about the proposals and foresee problems about staff, extra pay, working hours and so on.
    Mr. Teddy Taylor: The hon. Gentlemans represents one of the most beautiful tourist areas. Has he had a single tourist asking why pubs are not open on Sundays?
    Mr. Stewart: No, I have not. I was surprised that the hon. Member for Edinburgh, Pentlands (Mr. Rifkind) should have mentioned the tourist associations as being among the bodies urging that a change should be made.
    We are told that we must make the change for the tourists, but many tourists come from Scandinavia and other countries where the legislation is less liberal than our existing laws. Far from being deprived, they get even more opportunity for drinking. Why should we alter our laws for the benefit of tourists? If every country had the same regulations, why would tourists want to travel anyway?
    We cannot ignore the question of alcoholism. It will increase if we permit Sunday opening. I know heavy drinkers in my constituency who go to public houses every night. I admit that if they were desperate they could get a drink on a Sunday, but they normally call it a

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    day on Saturday and stay out of the pubs until Monday evening. During that 48 hours, the drink can get out of their systems and, if they are the sort to get obstreperous when they have been drinking, their families will have two days of peace.
    Mr. Neil Carmichael (Glasgow, Kelvin-grove): If the men to whom the hon. Gentleman is referring were alcoholics, they would not be able to turn off on Saturday night and stay away from drink until Monday evening. They would certainly find a way of getting a drink on Sunday. I do not think that the hon. Gentleman's argument is logical.
    Mr. Stewart: I was referring to men who were heavy drinkers, not alcoholics.
    The amendment passed in Committee will give offence to many people to whom Sunday is a day to cherish. It has religious associations and is a day of rest and relaxation. We cannot pretend that it will not add to the problem. People should not have this nuisance foisted on them if they do not want it. I do not believe there is any demand for it. I congratulate the Secretary of State on his presentation of the Bill and on his resolve to re-insert this clause.
    1.30 a.m.
    Mr. Canavan: I am grateful to you, Mr. Deputy Speaker, for calling me to speak because I was disappointed that I did not have the opportunity to be on the Committee dealing with the Bill, in spite of the fact that I spoke on the Clayson Report debate in the Scottish Grand Committee more than a year ago, and that I also spoke during the Second Reading of the Bill.
    At first I suspected that the powers-that-be were deliberately excluding me from the Committee because of my anti-Government views on this Bill but then, to my surprise, I discovered that the powers-that-be had other plans for me. They discovered that I was such a loyal supporter of the Government that they put me on the Finance Bill Committee instead.
    The Bill follows the publication of the Clayson Report. Dr. Clayson himself was a medical man and he and his colleagues on the Committee were just as concerned as the Secretary of State and his predecessor about the problems and
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    abuses of alcohol and the problems of alcoholism in Scotland. The Committee's main concern was to make Scottish drinking habits more civilised and to create an atmosphere which encouraged self-discipline in the use of alcohol.
    I realise that some people regard the consumption of alcohol as evil in itself. But that is such a minority view that it is virtually impossible to embody it in legislation. Even under the present laws, and within certain limits, there is the possibility of the consumption of alcohol in certain circumstances.
    During the course of this debate, there appear to have been two schools of thought. One is the school of thought headed by the Secretary of State which argues that increased licensing hours will lead to increased consumption which will, therefore, lead to increased abuses, increased alcoholism and so on. So far, I have not been convinced by the evidence produced by that school of thought.
    Another opinion, which has been put forward in the Clayson Report, and again tonight, is that a liberalisation of the licensing laws, combined with an improvement in licensed premises and the provision of food and so on would create a more civilised atmosphere which would encourage moderation in the use of alcohol and which would, hopefully, make people more self-disciplined instead of relying on an external discipline imposed on them by legislation.
    Experience in England, where the licensing laws are a little more liberal, and where there is Sunday opening, shows that according to the statistics, the abuse of alcohol is less than in Scotland. That seems to support that school of thought which believes that increased liberalisation would lead to increased civilisation in the consumption of alcohol.
    With regard to Sunday opening, I fully appreciate that there are many people throughout Scotland who value Sunday as a day of religious observance, a day of rest and a family day. I have had several representations from my constituents, most of them, I think, members of the Church of Scotland, who have put this point of view to me and used it as an argument against Sunday opening. I have politely written back disagreeing with them but I have done them the

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    courtesy of forwarding their views to the Under-Secretary of State in charge of the Bill. I fully agree that Sunday should be a day of religious observance and a family day and a day of rest but, frankly, I do not think there is anything incompatible between that and a modest consumption of alcohol on the Sabbath.
    I frankly do not believe that those who religiously abstain from alcohol on Sunday have a monopoly of belief in God or a monopoly of belief in Christianity or any other religion. Even Jesus Himself turned the water into wine. Perhaps the reverend and hon. Member for Belfast. South (Mr. Bradford) can quote me the Biblical reference and tell me whether He did it on the Sabbath or not. Even if He did not perform that particular miracle on the Sabbath, I am sure that Jesus Himself must have had many a drink on the Sabbath day.
    Mr. James Dempsey: Is my hon. Friend aware that when Jesus changed the water into wine, it was ginger wine?
    Mr. Canavan: I was not aware of that I should have thought that Jesus has more taste than that.
    I am not a perfect Christian by any means and it would be hypocritical to say otherwise. Like most Scottish Members, I am down here in London from Monday to Thursday. We travel back to our constituencies at the weekend. On Fridays and Saturdays, there are many demands on us, with surgeries, school and factory visits and so on. I look forward to Sunday as a day of rest and a family day. On a typical Sunday I get up in the morning and take the family to church. I usually read the lesson. I may say that I do not have to wait as long to read the lesson as I do to speak in this place.
    Mr. Deputy Speaker: This is not a church but the House of Commons, and the practices are not the same.
    Mr. Canavan: I am grateful for that reminder.
    In the afternoon, I may take my wife and family out. In the evening, after the children are in bed, my wife and I often go out for a quiet drink in order to relax. It has been our unfortunate experience
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    that many hotel bars and lounges are grossly overcrowded. It is almost impossible to get a quiet drink on a Sunday night.
    Mr. Fairbairn: When the hon. Member reads the lesson, I trust that it does not take so long.
    Mr. Canavan: The attendance at my church has shot up since I started reading the lesson.
    This problem is even worse in the cities than it is in my constituency. I lived in Edinburgh for a time and I have visited Glasgow on a Sunday. The conditions in many hotel bars in the cities can only be described as barbaric. It is our duty to get rid of those conditions, which among some people may even lead to increased drinking.
    This congestion would be eased if public houses were given the option of opening, but there must be adequate safeguards. I do not favour the opening of pubs on a Sunday at 11 o'clock in the morning. Many people who go to church would be offended if there were a pub or club next door to the church. My understanding of the Bill as amended in Committee is that opening time on a Sunday would be 12.30 p.m., not 11 o'clock. That is a reasonable compromise. It would not violate the Sabbath and frankly I do not think that it would increase alcoholism, either.
    Any hardened drinker who is determined to have a drink will find somewhere on a Sunday. If we got rid of the barbaric conditions in some of the hotel bars it is possible that even the hardened drinker would be encouraged to drink less. I see no evidence that he would necessarily consume more.
    The working conditions of the staff must be considered. In general, bar staff are industrious people who work long, anti-social hours, often in trying circumstances. In my opinion, no publican should be forced to open on a Sunday. The Bill, as it stands, would not force publicans to do so. Indeed, it would give them an option.
    It is interesting to note that the Scottish National Party apparently carried out a poll in Clackmannan, the result of which was that most publicans do not want to open on a Sunday. Therefore, I

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    assume that the hon. Member for Clackmannan and East Stirlingshire (Mr. Reid), who is not in his place, will vote against Sunday opening. Of course, we should bear in mind that the proposed Sunday opening is optional and that SNP polls are not very reliable. The SNP carried out a poll in West Stirlingshire, at the time of the General Election, and claimed that its candidate was 5,000 votes ahead of me. My very presence in this House shows that the credibility of SNP polls is not so great.
    There is also a bit of dishonesty on the part of the Scottish National Party. It has been sending round scurrilous leaflets in the Garscadden area of Glasgow saying that this London Parliament, which allows the English to have their pubs open on a Sunday, will not allow time to introduce legislation so that the Scots can have their pubs open on a Sunday. The implication is that the London Parliament considers that the Scots are too uncivilised to have their pubs open on a Sunday. That is the kind of scurrilous nonsense that the SNP is spreading around, varying, as it usually does, from one constituency to another.
    I do not think that any bar staff should be forced to work on a Sunday. In most cases, where Sunday opening is thought desirable, I am sure that a flexible rota arrangement can be made so that the staff need not work any extra hours in the week.
    Mr. Harry Ewing: Is my hon. Friend, as a good trade unionist, in favour of bar staff being paid double time on a Sunday with the effect that may have on the price of beer?
    Mr. Canavan: I am glad that my hon. Friend mentioned that matter. My experience is that bar staff are not organised into trade unions. If they were organised into trade unions—for example, the Union of Shop, Distributive and Allied Workers—they would be able to negotiate better working conditions, wages, and contracts which might not necessarily force them to work a longer week. The brewer and distillers are making enough profits to keep the prices down.
    I am in favour of rejecting the new clause and of keeping the Bill, as it was amended in Committee, to allow the
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    optional opening of public houses on a Sunday.
    Mr. Hamish Gray: I do not propose to follow the hon. Member for West Stirlingshire (Mr. Canavan) in what he said because I disagree with much of his argument. However, that is nothing new. If the hon. Gentleman's description of the pubs in Glasgow is accurate, he put forward a good argument for keeping them closed on a Sunday. I do not think that men will wish to take their wives into those pubs.
    I find myself in almost complete agreement with the remarks made by the right hon. Member for Kilmarnock (Mr. Ross). There is little doubt that there has been no great demand, despite what certain hon. Members may say, for the opening of pubs in Scotland on a Sunday. I have had more representations against the opening of pubs on a Sunday than on any other issue since coming to this House six years ago. My constituents have produced a host of reasons for not wanting pubs to open on a Sunday.
    We have heard about the Highlands and the high incidence of alcoholism there. It may be that those who live there are fully aware of that problem and, for that reason, do not want the availability of liquor to be increased.
    Whatever arguments we may have heard about the Scots and alcohol—whether it be the temperament of the Scots or the climatic conditions in Scotland—there is no denying that the increase in alcoholism has been proportionate to the availability of alcohol. Hon. Members have argued that improvements have been made, but those improvements in the licensing laws and of the public houses have only proved that the more people visit public houses, the greater is the incidence of alcoholism.
    I speak from a different view point from that of the right hon. Member for Kilmarnock and my hon. Friend the Member for Glasgow, Cathcart (Mr. Taylor) because they are both teetotallers and are known as such.
    Mr. William Ross: No.
    1.45 a.m.
    Mr. Gray: The right hon. Gentleman may say "No" but people accept that he is as near a teetotaller as makes no

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    difference. I am not a teetotaller, nor are a great many of my friends, and it is significant that we speak from an experience which he does not have.
    We must be responsible and as we study the situation in Scotland we must consider whether, if we agree tonight to open public houses on Sunday, we shall create additional work for certain sections of the community—social workers, for example. My hon. Friend the Member for Cathcart did not include social workers in the list of those who have made representations to him. We have only to talk to social workers in our constituencies about the problems that they encounter as a result of alcoholism to realise that they have a different view from that expressed by some hon. Members tonight.
    In the Highlands of Scotland tourists do not complain about pubs not being open on Sunday for the simple reason that they can obtain alcohol at their hotel or at any hotel if they eat a meal there. There is no demand for Sunday opening from tourists. I agree with the hon. Member for Western Isles (Mr. Stewart) that one of the attractions of the Highlands in particular, is that life is not the same as it is in England or as it is in the south of Scotland. Why should we bow to the pressure of small groups when tourism in the Highlands is booming in such a healthy fashion?
    The words of the Churches should not necessarily be our main guide in taking this decision, but there is little doubt that Sunday opening would be offensive to many people—and I again refer to my own part of the Highlands where the tradition of church-going has survived to a greater extent than in other parts of the country.
    There is no public demand for Sunday opening and I hope that the House, having considered the arguments of those who advocate that policy, will feel that the Government are taking the correct action in their clause. I shall support the Government on this issue and I hope that other right hon. and hon. Members will do the same.
    Mr. Carmichael: We have all received quite a number of letters on the subject. I had a fair number from my constituency, almost all saying that the pubs
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    should not be opened on Sundays. I have a great deal of respect for the people who wrote.
    We all have the same object. I want alcoholism and the consumption of alcohol in Scotland to be reduced, but I do not believe that the suggestion of my right hon. Friend the Secretary of State will achieve that reduction. Many hon. Members have pointed out the illogicality of the use of the argument that greater availability of drink leads to more alcoholism when we are extending pubs' opening hours by six hours a week.
    I am not a frequenter of public houses. Like many hon. Members, I drink very little, but I shall be opposing the Government on the clause. My right hon. Friend advanced a good case for prohibition, but everyone fights shy of that. We know that it is a nonsense and does not work. One cannot impose such laws on a modern society.
    However, I am surprised that my right hon. Friend and other hon. Members have not suggested at least a drastic reduction in the advertising of alcohol. The antismoking campaign was particularly successful. There has been a big drop in the number of people smoking, if not in the consumption of tobacco. I should be only too willing to support any restriction on the advertising of alcohol, particularly on television.
    One hon. Member spoke of the hypocrisy in Scotland on the subject of drinking. One of the contradictions is that we have a great deal of advertising of alcohol—on television, at the cinema, in the Press and on hoardings—and yet at the same time we make drinking a great mystery. Secretive and furtive drinking is part of the problem. Young people in Scotland find that the pubs are a mystery. Until fairly recently—and it may still be the case—pubs had to be boarded up and have frosted glass so that no one could see in. Doors were not allowed to remain open, and it was illegal to take a glass of drink out. Therefore, young people have had the idea that there is something wonderful and secret about drinking. That always attracts them.
    Mr. Harry Ewing: There is provision in the Bill for what is described as alfresco drinking.
    Mr. Carmichael: The mystery of drinking is part of the whole problem in Scotland. I still feel strange when I go into a pub. I feel that it is a strange world, because as a young boy in the East End of Glasgow I saw pubs as mysterious places. I think that it was John Calder who said in the Daily Record recently that a man's reputation could be ruined by someone just saying "He drinks." There is a great deal of hypocrisy about drinking. I do not think that in the modern world alcoholism is totally related to the availability of drink. The stresses of modern life have a great deal to do with it.
    The first question that comes to mind on Sunday opening is "What about the staff?" People who want Sunday opening have told me that they may have to pay more for their drink, that they cannot have the staff on the cheap.
    There is nothing wrong with talking about liberalisation. We have moved a great deal. There are not many drinking dens in Glasgow now. Glasgow always gets knocked around in the House, particularly by Members for other Scottish areas, but there has been an enormous improvement in the past 10 to 15 years. The increase in the number of licensed grocers and the increase in advertising have not helped to diminish the availability of drink.
    Hypocrisy was not better exemplified than by what seemed to be a telling point made by the hon. Member for Glasgow, Cathcart (Mr. Taylor). He mentioned the veto poll and the bona fide traveller. I lived on the border of Glasgow and Lanarkshire. The number of people trooping into Glasgow in bus loads to get a drink in a hotel was appalling. The veto poll is another piece of incredible hypocrisy.
    Next to my constituency is that of the hon. Member for Glasgow, Hillhead (Mr. Galbraith), who represents Whiteinch, which is a "dry" area. It is part of the folk lore of Partick that the "dries" of Whiteinch were supplied with money to run their campaigns every two or three years by the publicans and licensed grocers in Partick, who did not want to have a "wet" area next to them. Hell holes were created because people from Cathcart and Whiteinch moved into Partick to get a drink. When Kirkin-
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    tilloch was dry, one could hardly move in Glasgow bus station on a Sunday night because of the number of people waiting to get the last bus back to Kirkintilloch, many of them having been drinking disgustingly.
    I represent a densely populated area. The public house tied to the tenement is rapidly disappearing from Glasgow. One cannot have as many municipal houses as we have and not expect the old tenements to disappear, and they are disappearing, sometimes too rapidly for people to have a chance to settle down. However, I am concerned about the pubs that are left and I am anxious lest hypocrisy prevails and there is a fight to maintain "dry" areas and other restrictions because of the objections of local people.
    I suspect that it will be the more articulate people from Cathcart and similar places who will raise objections with the licensing boards. I am also a little anxious about the membership of the boards. If they are anything like the other boards we have, they are likely to pay more attention to people from "good" areas and less to people who come from areas such as mine and who are less articulate.
    Unless I am given considerable reassurance about how the boards are to operate—and I shall listen to my hon. Friend's winding-up speech with close attention—I shall want to leave the Bill as it was when it left the Standing Committee, and I shall support the opening of pubs on a Sunday, with all the risks, for I believe that the risks involved in the opposite course are greater.
    Sir John Gilmour: Having listened to the lesson being read by the hon. Member for West Stirlingshire (Mr. Canavan), I felt tempted to suggest that we have a psalm or a hymn between speeches.
    In all seriousness, I suggest that we have not got down to the different effects that the Bill will have in different parts of Scotland. This is a facet of the argument that ought to be developed. My hon. Friend the Member for Ross and Cromarty (Mr. Gray) said how little demand there was for the Sunday opening of public houses in the North of Scotland. I can easily understand why that is so. For instance, in Sutherland there are 50 hotels and four public houses. In

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    the county of Caithness there are 20 hotels and one pub. In Ross and Cromarty there are 116 hotels and 30 pubs. In my county of Fife there are 108 hotels and 91 pubs. Compare these figures with the city of Glasgow where there are 43 hotels and 790 pubs. For ordinary people at least half of the Glasgow hotels are not available anyway because of the prices charged in them. Obviously, we have a very different situation in different parts of Scotland.
    2.0 a.m.
    How do we make the difficult change? In Committee, I voted for the opening of public houses in Scotland on Sunday, and I still feel that that is right. If people can go into their own local public house on a Sunday, that is more likely to improve the standard of public houses generally.
    If it is impossible, as has been said, for a man to take his wife or girl friend to a pub, surely the reason is that it is a six-day type of place designed for men only. If it were to be open over the weekend, there would be an opportunity to make it a more attractive place to which people can go.
    Mr. Teddy Taylor: If a pub is open six days a week, and is suitable only for men, how does the situation change by opening it on Sunday as well?
    Sir John Gilmour: If there is a tradition that a pub is open only on weekdays, it tends to be a male preserve. Undoubtedly there are public houses which are malt-only preserves anyway. But in the long run, if public houses are open on Sunday there will be a change in their character. Men will find that they are places where they can take their wives and girl friends. They will no longer be hell holes but perfectly ordinary establishments.
    Admittedly there will be real difficulties in cities such as Glasgow, Dundee, Edinburgh and Aberdeen where the proportion of hotels to public houses is very different from that in country areas such as the Highlands and Perthshire. However, I believe that we should face up to the difficulties and make the change.
    Mr. Robin F. Cook: I am not prepared, at this late hour, to develop my argument, but at Committee stage I was against the opening of pubs in Scotland
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    on Sunday and I hold on to this view now, quite unrepentantly.
    My hon. Friend the Member for Glasgow, Kelvingrove (Mr. Carmichael) and other hon. Members have referred to the representations of the National Association of Licensed House Managers. I found representations from members of that Association very telling, because they know that they have to work 70 to 80 hours a week at present, and they know that if there is Sunday opening of pubs, regardless of what has been said about shift work and extra rest days, they will have to work on Sundays as well.
    It is not good enough to throw out charges of hypocrisy, as my hon. Friend did, acknowledge the concern and anxiety over longer working hours and then vote for the measure. Many members of the association will have no choice whatever about whether their pubs will open on Sunday. That decision will be made by the major brewing organisations.
    My hon. Friends would be horrified if in any other context they were accused of siding with big business, but it is exactly the side of big business that they are taking on this occasion. They would be horrified if they were accused if disregarding the views of a trade union in an industry, but in this case they are disregarding the views of the one major employee organisation in this industry.
    Mr. Rifkind: The hon. Gentleman said that in the vast majority of cases the decision would be taken not by the licensee but by the brewery that owned the pub. The Clayson Committee report stated that only 27 per cent. of licensed premises in Scotland are owned by breweries compared with 86 per cent. in England and Wales.
    Mr. Cook: The hon. Member is perfectly well aware that that does not alter the substance of the argument because the majority of public houses in Scotland, whether or not they are owned by the brewing organisations, are tied very firmly to the supplies of that company and the company can exert a very strong pull on the policies of the pub. In addition, whatever may be the present balance, the trend is towards greater dominance of the public houses by the brewing organisations.
    Mr. Robert Hughes: In a sense, whether a pub is owned by the breweries or is tied to them is irrelevant, and I concede to my hon. Friend that the decision will be taken by the owners.
    Mr. Cook: I am afraid that that contribution is lost on me but I reiterate that the major employee organisation involved in the industry knows that its members will have to work longer hours on top of an already long working week.
    Another feature of the arguments of those who favour Sunday opening is that we must have either one extreme or the other, that we could have 24-hour opening of pubs and total abolition of licensing laws, or total prohibition. We are all aware that the human mind gropes instinctively for two opposing contrasts. We know that when we go to the electorate my hon. Friends and I like to pose two stark choices. We offer ourselves as representing full-blooded humane Socialism as opposed to someone representing savage atavistic Conservatism at its worst. But there are always more than just two extremes. Often there is a sensible compromise, in this case to provide a certain restriction of access to alcohol but which can provide a prefectly adequate freedom of access to alcohol in a civilised context. I hope that hon. Members will stop trying to direct the debate into one of two positive polarised aspects.
    Hon. Members have also raised the question whether the incidence of alcoholism in Scotland is necessarily related to our licensing laws. We must be plain, and some hon. Members do not seem convinced of it yet, that we have an extremely serious problem of alcoholism in Scotland. The problem is not only bad but accelerating. It is not a question of recording technique. Even if it is argued that our hospitals are now more capable of recognising, diagnosing and admitting alcoholics than before, it is difficult to understand why in Scotland we have seven times as many admissions for alcoholism than in England. Are we to believe that our hospital service is seven times better at diagnosing and catching alcoholics?
    It is difficult to understand that in the last 15 years offences of drunkenness have doubled in Edinburgh. Are we to believe that this is becaue we have a more
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    vigilant police force which is catching and identifying drunks on the streets much more effectively than 15 years ago? That is hard to believe. It has been said many times that there is a more restrictive licensing law in Scotland than there is in England, and that that cannot be related to the fact that we have a high incidence of alcoholism.
    It is said "They have longer drinking hours in England but less alcoholism. If we had longer drinking hours we might have less alcoholism." The studies that have been carried out in 25 countries have shown repeatedly that increased access to alcohol leads to increased consumption and that increased consumption increases the incidence of alcoholism. It does not matter which group in society is studied, be it women or children, the result is an increased incidence of alcoholism.
    We have a serious problem of alcoholism, a problem that is worsening. If we allow the opening of public houses on Sundays, there is a possibility that the problem will increase. However, speculative or doubtful that possibility may be said to be, it is a matter that weighs heavily with me. It is an argument that I find overpowering.
    I cannot pretend to understand why it is that the English, who have longer drinking hours, have a lower incidence of alcoholism. The origins of alcoholism in our society are complex and I am not clever enough wholly to understand them. It is a remarkable fact that a high proportion of those convicted of drunkenness in England originate from Ireland or Scotland. Even when we transport the Celts into the civilised English drinking system they seem to throw up a greater problem of alcoholism. It is a difficult problem that is not properly understood.
    There can be no doubt that if we carry out this reform we risk worsening the problem of alcoholism in our country. That is a risk from which we cannot run away. We can say that on balance we accept that there is a danger of increasing alcoholism but we wish to increase the freedom of the individual. That is a legitimate point of view, but it cannot be denied that we are balancing the greater freedom to have access to drink with the strong posibility of increasing

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    the rate of alcoholism. I am not prepared to increase access given that balance.
    Sunday is a day of rest not only for those who work in the public houses but for those who have to live beside them. The hon. Member for Glasgow, Cathcart (Mr. Taylor) said that he has no public houses in his constituency. He is rather more fortunate than most of us. I have more than my fair share for the whole of Edinburgh because I represent a central area. There are plenty of bona fide travellers for six days a week who go into central Edinburgh to drink in the public houses, but if those who have talked about civilised drinking visited some of the public houses in my constituency in certain areas they would find it difficult to recognise the description that we have heard tonight. If they visited these public houses, they would find that the neighbours have constantly to put up with fighting and brawling in the streets outside. That is almost a nightly occurrence. The neighbours are used to the spectacle of vomit on the pavements when they go out the next day. They are accustomed to washing the urine off the steps the following day. They would find it intolerable if they were to have to put up with those conditions on the seventh day. I have no doubt about the balance of opinion in my constituency.
    The fall-back position that the Government have prepared has necessitated a considerable amount of effort and thought. As a fall-back position, it has a good deal to commend it. I welcome the provision that the Government have included in an attempt to protect residents and tenants. Nevertheless, I feel that what is proposed is greatly inferior to the present position. I shall still vote for the status quo.
    Mr. Russell Johnston: As has been indicated by those who have immediately preceded me, it is becoming rather late in the argument to introduce anything that is new. Nevertheless, I think we each have an obligation to express a view on a matter that has aroused a great deal of genuine controversy in Scotland.
    It has already been said that the Secretary of State was in many ways rather disingenuous when he emphasised at the beginning that his view on Sunday open-
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    ing was in no way affected by Sabbatarian attitudes. I think it must be recognised that for many people in Scotland their view is affected by just such attitudes. It has certainly been the principal motivation in the Church lobby to which most of us have been subjected.
    I do not know what has been the experience of other hon. Members but I have had approximately 230 letters from my constituency, all the writers being opposed to the opening of public houses on Sunday. Virtually all of them were directly motivated by statements by ministers in pulpits.
    2.15 a.m.
    It is perfectly proper that the Church should express a view on this matter. It has experience of it through the normal activity of ministers. But I still feel that the concentration on an issue of this sort to the exclusion of many others is not a particularly good reflection upon the Church.
    Together with other hon. Members from both sides of the House, I discussed with a joint deputation of the Church of Scotland and the Free Church of Scotland the opening of public houses on Sunday. That was the first time in 12 years in this House that I had met such a deputation about anything at all.
    I should have thought that the role of the Church involves more than talking about drink alone, divorce alone or abortion alone. There are matters such as the education of our children, social deprivation, homelessness, unemployment, the disabled, to which the Church would do well to direct its attention, rather than concentrating alone on issues such as that before the House, important though it is.
    If the Church is concerned solely with issues of this kind, it rather indicates an introvert attitude within it, which leads me to feel that it is getting somewhat out of touch with the principal social imperatives with which we have to deal.
    Despite what the hon. Member for Glasgow, Kelvingrove (Mr. Carmichael) said about the idea of veto polls being incredible hypocrisy, I frankly think that that is the most logical position of all. Indeed, it is the position set out in Amendment No. 49.
    Mr. Carmichael: I can see the hon. Gentleman's point. The hypocrisy arises

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    in a city area, when there is only a 20-minute walk or a five-minute car run required to move from a "dry" to a "wet" area, and the "wet" area tends to get all the problems. It is quite different from the position where there are fairly long distances between "wet" and "dry" areas.
    Mr. Johnston: I quite accept the validity of what the hon. Gentleman says, but in making some sort of local option possible one could in the end base it, as Amendment No. 49 does, only upon the licensing board areas. In the case of the cities, this means the District Council of Glasgow, the District Council of Edinburgh and the District Council of Dundee. That would obviate the kind of exploitation to which the hon. Gentleman refers.
    The way in which the amendments are cast makes it necessary for me to vote with the Government on New Clause 1. Nevertheless, in doing so I am personally quite sharply and painfully aware, particularly as a Liberal, that there are large areas in Scotland—especially, perhaps, in Central Scotland—in which the democratic view of the area is in favour of Sunday opening.
    I do not particularly want to repress that local choice. I do not want to have a flat view imposed on my area, nor do I particularly want to impose a view on other areas, either. I know equally—certainly this has been the pattern of the debate—that there are few certitudes in this question of alcoholism. The hon.Member for Edinburgh, Central (Mr. Cook) articulated this well.
    Several hon. Members asked whether alcoholism increased when drinking hours were extended. Some said that that occurred. Others questioned that. Some said that when more companionable conditions were created, wives went into pubs, which increased drinking without necessarily increasing the rate of alcoholism.
    Why is the incidence of alcoholism twice as high in Scotland as in England? Why is it twice as high in the Highlands as in the whole of Scotland? There are no licensing laws in Italy and France other than market forces. The pubs and cafés remain open as long as there are customers in them. However, there is a high rate of alcoholism in France and a
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    relatively low rate in Italy. No one knows why.
    Mr. Fairbairn: There is an explanation. In France we may not drink the water. The French, whether children or adults, must drink wine. The Italians are not obliged to drink wine.
    Mr. Johnston: The hon. and learned Gentleman always seems to have a capacity for reaching solutions at which learned committees have for many years failed to arrive. I do not know that there is all that much evidence. I defer to the hon. and learned Gentleman when he implies that the water in Italy is better than that in France. However, French wine is better than Italian wine. That is another matter.
    I am not sure that longer opening hours for off-licences mean more alcoholism. Consideration of the facts leads me to believe that the alcoholic makes sure that he has access to drink when he wants it. It is a difficult matter. As a Liberal I believe in the right of choice. People should be able to make up their own minds. I reject the kind of unsympathetic repression towards which the hon. Member for Glasgow, Cathcart (Mr. Taylor) leans. People should have the capacity to make up their own minds on individual and community questions. If a community or the people in a recognisable locality do not want drink, let that be. If they want it 24 hours a day—which was one of the options upon which the Secretary of State poured scorn—so be it. The principle should be what the people in recognisable local areas want to do or have.
    This is the choice that I have before me. If I support Sunday opening but the people of my area oppose it, I may impose on my constituents an arrangement which they oppose. There is evidence showing that the proposal is opposed by people in Central and possibly even in North-East Scotland.
    The whole argument about drink in Scotland is riddled with cant, hypocrisy and inconsistency. At the end of the day I suspect that whatever solution we produce will have elements of hypocrisy within it and certainly aspects of inconsistency. I do not know whether there is any way round that, but at least we in the House should recognise our own

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    fallibility. I accept that we have an alcoholism problem that is more severe than is general in Europe, but it is nevertheless accepted that there are no clear solutions.
    If the local option solution, which I think would be the best, is not available, a flat opening of public houses on Sunday would impose on communities, some of which I represent, a style of behaviour for which there is no expressed demand.
    Reference has not been made to the opinion polls, for example, in the Daily Record and the Sunday Mail. They appear to be the only quantitative evidence of pressure for the change. I have not received any letters saving that the change is desirable. I am aware that the receipt of 230 letters saying that the change must not be made is equally a distortion of reality because it means that people are being pressed. Any genuine pressure would be expressed in what people say and write to me, and so far I have experienced none.
    Mr. Dalyell: The hon. Member for Inverness (Mr. Johnston) criticised the kirk for being concerned solely with this issue. My experience in West Lothian is a little different. To their credit the kirk and individual ministers have raised many social issues over the years.
    Like other hon. Members, I have received a large number of letters, but perhaps those that worry me most come from publicans. The hon. Member for Edinburgh, Pentlands (Mr. Rifkind) skated over this matter all too lightly. I quote from a typical letter which I have received from a publican:
    "I protest on the grounds that I work 70 to 80 hours a week at present, and I look forward to Sunday as the one day in the week when I am able to enjoy a normal family environment."
    Has any assessment been made of the added costs of Sunday opening and the ease with which replacements can be found and the general question of the effect of Sunday opening on the working conditions of publicans and their staff?
    I address myself to the Leader of the Liberal Party and claim perhaps in this matter, though not in others, "I am a better devolutionist than thou." For a long time some of us—in the minority—have argued, precisely for the reasons
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    given by the hon. Members for Western Isles (Mr. Stewart) and Inverness, that requirements vary from one part of Scotland to another. Not only would the House of Commons be spared late nights but, far more important, a better solution would be arrived at if this issue—and many others—had been left to the regions, because there are genuine differences between the Western Isles on the one hand and Edinburgh on the other.
    2.30 a.m.
    Mr. Fairbairn: I shall follow the hon. Member for West Lothian (Mr. Dalyell) exactly on the point on which he finished.
    Scotland has entirely different problems as my hon. Friend the Member for Fife, East (Sir J. Gilmour) said. For instance, in Perthshire there are 217 hotels and 45 pubs. In Rutherglen there is one hotel and there are 22 pubs. There is the same number of people in both areas, so we are dealing with entirely different problems.
    I reject all the arguments about whether people would drink more or less, or would become alcoholics or drunks or anything else if the pubs opened on a seventh day in the week. The falsity of that argument is that those who advance it do not understand and may not want to understand that the fact that there is no Sunday opening in Scotland does not mean that they stop drinking for one-seventh of the time. So we have a situation where people drink on a Sunday. The question is whether, in those areas where there appears to be the difficulty that there are not sufficient hotels to allow people to drink, they should he permitted to do so.
    I find myself in an extremely difficult position. The Under-Secretary will recall that in Committee I said that I thought that a selective attitude should be allowed and that it should be used to raise the standard of public houses.
    My hon. Friend the Member for Glasgow, Cathcart (Mr. Taylor) talks about hell holes. I am unimpressed by that sort of language. I had great pleasure in drinking in the "Wee Man" behind the High Court, in Edinburgh. My hon. Friend would call that a hell hole but I found it a haven, among the sort of people with whom Labour hon. Members might not think I normally associated.
    Mr. Teddy Taylor: Would my hon. and learned Friend take his daughters there?
    Mr. Fairbairn: I would take one 01 my daughters to the "Wee Man" but I could not make her drink. I would not take my other two daughters.
    This is a problem that we must face. It is purely an urban situation and exists only in certain areas. It is not a matter of principle because the pubs are open and one can drink on a Sunday anywhere. It is not a matter of alcoholism because I do not think licences have anything to do with that. The simple question is whether it is sensible to make the pubs in Scotland open everywhere. It would be asinine in my constituency. They would have to open, because if one did, all the others would. Nobody wants it in my constituency, or in Ross and Cromarty and many other parts. Do we have to have it everywhere in order to cure a problem somewhere? That is the difficulty in the situation in which we are placed, and the Government's let-out clause is a poor let-out because it says:
    "A licensing board shall refuse an application made under paragraph 2 above if it is satisfied that the opening and use on a Sunday of the premises to which the application relates would cause undue disturbance or public nuisance in the locality, but otherwise shall grant the application."
    The one place in which it will not cause a nuisance is my constituency. We do not have pubs in tenements. The pub is miles away from where anyone lives. So the pubs which would be allowed to be open and would get through the licensing board are those in a rural situation. The pubs that would need to be open if there were an urban demand would not get through.
    I respect the motivation of the Secretary of State, but he has got it wrong. Pubs in Perthshire, Ross and Cromarty and Inverness-shire would not cause a public nuisance because no one lives near them. Yet the pubs in Pentlands and Central Edinburgh, where there may be a demand and urban justification, will be cut out.
    I am compelled to vote for New Clause 1 because in my constituency, as in most other parts of Scotland, the provision in the Standing Committee amendment is unnecessary. We are trying to cure a localised, urban problem in a general way that offends many people
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    who do not understand what this is all about. The Government's fall-back position would exacerbate the problem rather than cure it. We should not be emotional about this matter. It has nothing to do with alcoholism or whether Sunday is a sacred day.
    A blanket requirement that every pub in Scotland must open would cause unnecessary offence to many people. It would be an unsuccessful attempt to cure a narrow requirement.
    Mr. Dempsey: I shall not detain the House for long. I have listened to every speech and found the wide-ranging deliberations very interesting, though it is beyond me how some of the theories became involved in this simple problem.
    My hon. Friend the Member for Central Ayrshire (Mr. Lambie) will probably soon be chiding me and suggesting that I should declare an interest. I am a lifelong teetotaller, though that does not make me intolerant. I served for 14 years in a licensing court in Lanarkshire before coming to the House. That is why I am a teetotaller. At a recent function, my hon. Friend the Member for West Stirlingshire (Mr. Canavan) tried to get me to break the pledge and said: "Give Dempsey a double Scotch and I'll pay his fine!"
    I shall do my best to hold to my convictions. I have been asked whether I took communion wine and my answer was "No". I had the pleasure of opening licensed premises in my constituency recently and they could not find a drink to suit me. When waiters came round with a tray of concoctions, I asked for a non-sweetened pussyfoot. The waiters looked mesmerised. When I asked one whether he had anything for a teetotaller, he shook his head sadly and said, "Nothing, sir, but respect."
    Hon. Members have overlooked the present situation. Hotels are open on Sundays and there are multifarious clubs in all communities. One point which has been overlooked is that pubs are already open on a Sunday. I sat on the Committee which dealt with the Guest Report where it was arranged that if any public house were willing to bring its facilities up-to-date and to provide meals, that licensee could qualify for Sunday opening hours. In my constituency today I have pubs which are

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    open on Sunday simply because they provide meals and alcohol is ancillary to those meals. That is the golden rule, and when we have regard to the number of facilities which are available one is entitled to ask whether there is a need to extend Sunday opening of pubs. I contend that there is no need at all.
    When we told licensees that they could have a Sunday licence if they were willing to spend money on their premises and to provide meals facilities, most of them rebelled against that. Licensees refused to spend money improving those particularly squalid properties in order to provide an environment for the enjoyment of a dram with a meal. It seems wrong that those same individuals, who never spend a single penny improving their properties, should be given the same rights as those who have spent thousands of pounds providing facilities. That point should also be borne in mind by the House.
    There is no doubt that the Bill in general provides for the provision of refreshments seven days a week. How my hon. Friend the Member for Berwick and East Lothian (Mr. Mackintosh) can logically argue that the new clause is tantamount to prohibition is beyond me. I have never heard that before.
    I am reminded of one licensee who refused to sell females a dram. He was against it because it meant providing toilet facilities for females and he was not willing to do so. We told him that he must give them a dram if they wanted it. He got over the problem by providing them with pails. We tried our best to get licensees to provide basic elementary facilities. Nobody has ever used that as an argument in favour of cutting our drinking, eliminating it and advocating prohibition. I had never heard of that theory until I listened to my hon. Friend the Member for Berwick and East Lothian this evening. I would tell him that if the places of which I am thinking are opened on Sunday I have not the slightest doubt that the average woman would not go to such places with her husband. We shall therefore have masculine drinking, which will result in men leaving their families at home. It will mean the interruption of family life, and that is bad enough at present. We have only to watch men going from club to club and notice where the womenfolk
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    are to realise what is going on. We are duty bound to take that into account.
    I belong to the Labour Party. I hope that my hon. Friend will never forget that thousands of people joined our movement in order to achieve temperance in our society. Others joined it—we should not be ashamed about it—because they believed in the sanctity of the Sunday. They joined it because they believed that the Sabbath should be kept holy. I go to church on a Sunday morning. My hon. Friend the Member for West Stirlingshire reads the lesson. It takes me all my time to understand it.
    2.45 a.m.
    Mr. Canavan: My hon. Friend does not go to the same church.
    Mr. Dempsey: Not the same building, but the same religious persuasion.
    We in this party owe much more to Methodism than to Marxism. We must take account of the family day, if nothing else. Considering drinking, especially in the West of Scotland, I have concluded that it is not so much the drinking laws as the drinking habits which need to be adjusted. Without the new clause the problem will be exacerbated. I was amazed to hear my hon. Friend the Member for Berwick and East Lothian say that the number of offences connected with drink has decreased. According to a report on the radio the other day, 160,000 people were tried in connection with offences relating to drink in the United Kingdom in the last calendar year.
    We all respect one another's opinions, but I hope that the new clause will be approved.
    Mr. Gordon Wilson: I approach this question from the standpoint of demand in my constituency. With the Bill in prospect, there was a small upsurge, to 23, in the number of letters I received opposing it. But before then I received letters requesting drinking facilities. So this can be judged in different ways. I understand that there is great feeling in Dundee about the absence of facilities for drinking in a civilised manner on a Sunday. I have heard of hotels which are jammed tight on a Sunday, where people who want a drink must queue up. I have not heard such hair-raising stories as the hon. Member for Glasgow, Cathcart (Mr. Taylor) mentioned, but no

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    doubt those things occur. Certainly there is a demand in Dundee for an extension of those facilities. There is a shortage of hotels. There are plenty of public houses but the fact that they cannot open on a Sunday causes difficulty.
    I am a churchgoer—not perhaps as regular as I might be—but I see no reason against people having a drink. If licensing hours are kept separate from church-going hours, particularly in the morning, I can see no difficulty arising. Many hon. Members will be voting tonight largely on an assessment of how their constituencies will react—
    Mr. Buchan: Do not believe it.
    Mr. Wilson: It could be true in certain cases. For instance, if constituencies which have a large number of hotels and a small number of public houses turn out to be against the opening of public houses on a Sunday, they may not be greatly affected in practice by the opening of the few public houses in their localities, but the votes which will be cast against Sunday opening could tell heavily in areas which have a shortage of proper hotel accommodation. That matter will condition my vote tonight.
    I turn now to the fall-back amendment—Amendment No. 92—which I was considering supporting. However, on study of it, I find certain aspects about which I am not sure. I should like some information from the Minister on the way in which it has been drafted. I draw attention particularly to paragraph 6:
    "A licensing board shall refuse an application…if it is satisfied that the opening and use on a Sunday of the premises to which the application relates would cause undue disturbance or public nuisance in the locality, but otherwise shall grant the application."
    These criteria in the fall-back amendment could cause considerable difficulty to licensing boards when they make this decision, particularly in relation to first-time grants where there is no evidence of disturbance. Some licensing boards may use that condition to exercise a general veto against the granting of licences. I know that an appeal may be made to the sheriff and that may take care of the situation, but that provision seems to give considerable discretionary power to the licensing boards.
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    Will any guidance or help be given to the licensing boards by way of memoranda by the Scottish Office regarding the type of nuisance or difficulty that might be expected to arise to warrant the refusal of a licence?
    Secondly, how does one prove that a disturbance or nuisance arises from a given set of premises? One public house and its clientele could be judged on the basis of nuisance or disturbance created by those who frequent another public house. In practice, it could be difficult for a licensing board to take action in circumstances where a Sunday licence has been granted, except where evidence is provided by way of conviction in court during the year showing that the trouble has come from a particular set of premises. I should like the Minister to explain as clearly as possible the practical effect of this fallback amendment.
    I congratulate the Secretary of State on his clear exposition of the meaning of the separate groups of new clauses and amendments at the outset of the debate. It put the matter in perspective and helped those of us who have been looking at the individual amendments and trying to piece them together to form a coherent picture.
    Mr. Buchan: I shall be brief. Indeed, I deliberately waited to hear the views of the main protagonists on both sides of the argument to convince me one way or the other. The arguments of the liberalisers have almost pushed me into supporting New Clause 1, with which I shall deal later.
    Certain comments must be made before we finish tonight. I have never been more ashamed of the Scottish Press than over the last few weeks. In the middle of the biggest economic crisis that we have ever faced, one would have thought that the fate of the nation depended entirely on whether we should have Sunday opening for pubs. Furthermore, I regret that so many hon. Members—particularly my hon. Friend the Member for Berwick and East Lothian (Mr. Mackintosh)—should have contributed to that campaign.
    I particularly resent that the Press took no trouble to understand the workings of the House, nor did hon. Members who were active in the campaign on one side

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    or the other make it their business to enlighten the Press. Issue after issue of quality and popular papers implied that there was something wrong, tyrannical despotic and completely unprecedented in the Government putting down an amendment to reverse a decision taken in Committee. That happens frequently, and it is right. I should not tolerate a position where a decision made in Committee was binding on the Chamber of the House.
    Mr. Dalyell: To help my hon. Friend's argument, did he see that one paper went so far as to suggest that it was mandatory for all Scottish hon. Members to attend my Adjournment debate on the tartan Army, tartan Navy and tartan Air Force after this debate?
    Mr. Buchan: If my hon. Friend is saying that there is a great deal of ignorance about the workings of the House, I agree with him. I deplore that the Press was so wrong and that some hon. Members contributed to that.
    The attitude of some hon. Members deteriorated so much that it became sufficient to say "England has it" to create the suggestion that the Scots were deprived. The argument then became based on the attitude that the Government were not allowing us to have what they have in England—as if the English were preventing us from exercising our own liberty. That is an indictment of how we have allowed the position to deteriorate. That is mesmeric nonsense which I deplore.
    I hope that we do not make a decision on the basis only of our own constituencies. It is important to consider the effect of all legislation on our constituencies but we should look at the total situation instead of looking at the selfish advantage which we might see for our own areas. That takes a bit of courage, but I hope that hon. Members will exercise it.
    I do not accept the argument that the different situation in France and Italy accounts for their lower incidence of alcoholism. If there is an explanation it is because Scots drink more spirits. It is part of our basic culture. We have different drinking problems and more alcoholism because of our long tradition of hard drinking. It was not initiated by
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    the licensing law as my hon. Friend the Member for Berwick and East Lothian suggested.
    Mr. Mackintosh: I said that it was encouraged.
    Mr. Buchan: I doubt whether it was even particularly encouraged. My hon. Friend should read the paeon of praise on the dark drinking dens of Glasgow where drinking has to be done vertically. That is a long tradition which was not discouraged by the licensing laws. It is difficult to assert the negative—that licensing has not helped—and then to assert that the nature of the licensing laws has contributed to a greater incidence of drunkenness and alcoholism in Scotland. That is not true.
    3.0 a.m.
    The liberalisers—I must include myself among them—must face up to the fact that if we extend drinking hours there will be more deaths and serious injuries and more alcoholism. [An HON. MEMBER: "And more freedom."] Of course, but there is a great deal of freedom to jump off the top of a skyscraper. The deaths are the price to be paid for the freedom.
    A great deal of drinking on a Friday is done by the people who also drink on a Saturday, and if there is drinking on a Sunday they will do a great deal of the drinking then. To that extent there is a greater likelihood of injuries and deaths on the roads and people moving into alcoholism. The liberalisers must face up to this and say that it is the price we must pay—a short-term price, because in the long run the problem will decrease. This is where I begin to have doubts, because I am not sure that an alteration of the licensing laws will change the situation at all.
    Mr. Teddy Taylor: Of course it will.
    Mr. Buchan: A change in social attitudes, housing, the environment and the pubs themselves will alter it. I had hoped that the fall-back position would be much tougher—for example, making it compulsory for those who wished to have a seven-day licence to make a fresh application, with tough criteria for granting that licence. Those who could not meet the criteria would have to stick to a six-day licence. To meet the criteria, applicants would have to have

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    good pubs, providing snacks and meals and coffee—perhaps a juke box. We had the opportunity to deal with the drinking problem in that way, rather than merely trying by the licensing—
    Mr. Robert Hughes: The toughness should not be tacked on to the Sunday question but should concern the state of the pubs as they are now.
    Mr. Buchan: I accept that, but I am a realist. We cannot impose criteria of that kind for every pub in Scotland. If we introduced them for seven-day licences that would have a feed-back effect. The argument would be that if a pub were not fit to open on Sunday it was not fit to open for the rest of the week.
    I have been put in a quandary. I am one of the great "Don't knows". I have been appalled by the certainty I have encountered on every side in this issue. I am not certain.
    I shall support the fall-back position. I hope to see how it can be strengthened in another place so that we may try to deal with the problem as it should be dealt with. It cannot be dealt with only by a change in the licensing laws.
    Mr. Mick Buchanan-Smith: I have sat here throughout the debate and have heard many preambles to speeches containing the words "I shall be brief." I can give the undertaking that I shall be brief, because I know that the House wants to come to a conclusion on the matter.
    I must confess that as a member of the Church of Scotland I share many of the views expressed by the hon. Member for Inverness (Mr. Johnston). I agree that some of us have had representations made to us on the basis that it was known where we would stand. The most honest representation that I have received was from a minister in my constituency who said that he had not detected any pressure for the opening of pubs on Sunday but as a parish minister he would not expect to receive any representations that pubs should be open on a Sunday. I read the rest of that letter with far greater attention than I paid to some others.
    We have had a thoroughly good debate this evening and we had a good debate in Committee. Tonight we have had 15 speakers apart from the Front Benchers.
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    I want to make two preliminary observations before coming to my theme. We sometimes tend to forget, certainly people outside the House do, that alcohol is already available on Sundays in hotels and clubs. I remind those who need reminding of the table on page 34 of the Clayson Report showing that since 1945 the number of clubs in Scotland has risen from 681 to 2,148 in 1972. That is a reflection, but not necessarily the best reflection, of the kind of licensing laws that we have had in Scotland in that time.
    Secondly, as the hon. Member for Dundee, East (Mr. Wilson) and others have said, we have also to remember that there is a curious pattern in Scotland. My hon. and learned Friend the Member for Kinross and West Perthshire (Mr. Fairbairn) acknowledges that there is a problem. I do not agree with his conclusion that because there are different problems in different parts of Scotland, we should do nothing. In the past we have tended to legislate for the lowest common denominator, but now we want to raise standards and to legislate for the whole of Scotland. We must not run away from them just because the problems in different areas are different.
    That is the general background. Drink is available on Sundays but not necessarily in the best places or in the best ways. That is a fact that we have to face. I cannot emphasise too much that the opening of a pub in Scotland on a Sunday will be discretionary.
    I do not want to go all over the arguments because they have been made very thoroughly, but I should like to deal with the subject mentioned by everyone who has spoken—alcoholism and the problems of the abuse of drink. No one wants alcoholism to increase. We all want it to reduce. But the same arguments are used to prove different ends. For instance, the right hon. Lady the Member for Lanark (Mrs. Hart) mentioned international comparisons. I do not find these arguments conclusive one way or the other. Much as I want alcoholism to be reduced, I do not accept all the arguments. I do not believe that in the way I shall vote tonight I shall necessarily have a monopoly of truth.
    We have a problem of alcoholism in Scotland and we have a problem of drink abuse. What we have to decide this

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    evening is whether we are better in dealing with the problem to keep the situation as it is or to try to change it. I come down, as I did in Committee, on the side of the view that, given that it is a bad situation, it is worth trying to change it and to improve attitudes to drink and in that way to improve the present situation.
    I appreciate that the right hon. Member for Kilmarnock (Mr. Ross) was the architect of the Bill in the form in which it came to the House. He said that it was a balanced Bill, and I respect his view. But I do not believe that any of us has a monopoly of necessarily knowing what is right or best at the end of the day. We have had the Clayson Report and that, too, was balanced.
    I believe that when the balance is taken away from that report—and that is what the Government did in their original proposals—a major item in the attempt to liberalise attitudes towards alcohol is also taken away. We run the risk of upsetting the balance of the whole approach of the Clayson Committee.
    For my own part, while I respect the arguments put forward by those who oppose Sunday opening, I think there is a certain measure of illogicality in them, and if they are followed to their conclusion that will lead to greater restriction. I believe that it is worth taking the risk—and I admit that there is a risk—of going for a greater degree of liberalisation in order to get civilised attitudes and to improve the situation.
    We have seen improvements in Scotland over a number of years. I want to see those improvements carried forward. I have a young family, and for many years I have been working among young people, but I believe that allowing pubs to open on Sunday is right and worthwhile. I hope that it will be endorsed by the House.
    Mr. Harry Ewing: The main feature of this debate is the degree of tolerance which has been shown by those who take opposing views. I share the view of my hon. Friend the Member for Renfrew-shire, West (Mr. Buchan) that this same tolerance and understanding was not shown in the comments of the Scottish Press, excluding the editorial in yester-
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    day's Daily Record which did catch the mood of the House of Commons and the people generally.
    I shall go right through the debate. I do not believe that anything I say at 3.15 a.m. will change the mind of anyone, but I have the responsibility, with the last word in this debate, to emphasise the points which were made by my right hon. Friend the Secretary of State in introducing the new clause. I have the responsibility to point out to hon. Members in all parts of the House that while I accept that alcohol is available in Scotland on Sunday, this debate is about whether we legislate to open a further 4,000 outlets for the sale of alcohol. The House has a clear responsibility to consider the consequences of such a decision.
    I was very interested in many of the contributions tonight, particularly that of my right hon. Friend the Member for Kilmarnock (Mr. Ross), who was Secretary of State when we started the process of putting together this legislation. I was interested to hear him say that the Church of Scotland, while not agreeing with every aspect of the legislation, commended it as a balanced package. It is a great pity that many of the good things that we have done in this legislation have been submerged in the debate on whether we should open pubs in Scotland on Sunday. In fact, Dr. Clayson said this reform of licensing legislation in Scotland was the best this century. It is a great pity that the Scottish Press did not pick up all the good things that the Bill does instead of concentrating on the issue of Sunday opening.
    3.15 a.m.
    I was most interested by the contribution of my hon. Friend the Member for Edinburgh, Central (Mr. Cook). I was tempted to rest my reply on what my hon. Friend said because I felt that his contribution was the most profound of the debate. He was drawing on the evidence submitted to the Select Committee on the problems of alcoholism and the availability of alcohol through these additional retail outlets. No one can ignore what will happen if we increase the availability to the extent suggested.
    We are then asked how we can extend evening opening hours from Monday to Saturday yet argue against opening on a Sunday. There is no logic in

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    licensing. Therefore no one can argue a logical case whether the pubs should be open on a Sunday against a background of the decision to extend weekday opening hours. I hope therefore that no one is casting a vote tonight on the basis of logic, because there is none.
    We were asked about the fall-back position. New Clause 1 involves the decision in principle whether public houses should be opened on a Sunday. If it is carried the associated amendments would obviously be carried and the remainder of the grouped amendments would not be moved. If New Clause 1 is not carried we come to the fall-back position, which I know some hon. Members would like explained. We have introduced it because we want to impose on publicans and licence holders an obligation should the House vote for Sunday opening.
    Let me clear up one point about the discretionary powers of publicans to open on a Sunday. The present legislation is discretionary in that a public house does not have to open any day of the week that it does not want to open. The Bill does not change that. Any licence holder who applies to open on a Sunday will immediately trigger off the procedure as though it were an application for a new certificate. That means that those with a statutory right of objection as defined in the Bill would have the right of objection under the fall-back procedures. It covers the important question of protection for those in tenement buildings who share a roof with a public house. The publicans would be under an obligation to notify in writing all those adjoining tenants. The collective representatives—we found it difficult to define what a residents' or tenants' association was so we used the term "collective representatives"—or the individual tenants will have a statutory right of objection. Equally, the licensing board will be under an obligation to publish that application from the licence holder to open on a Sunday. All those matters will be triggered off when an application is made for Sunday opening.
    Mr. David Steel: When the hon. Gentleman says that it will be treated as a fresh application, does he mean that it will be possible for a publican to apply for Sunday opening and in the course
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    of having his application reviewed to lose his existing six-day licence?
    Mr. Ewing: I am grateful to the hon. Gentleman for emphasising the point that I was about to make. My hon. Friend the Member for Renfrewshire, West complained that the fall-back position is not strong enough. If the licensing board refuses an applicant permission to open on a Sunday, he will not lose his six-day licence. The legal advice we have received is that such a course would not stand up in law.
    The two exceptions that are made in the fall-back position, as distinct from the application for a new certificate, is that there will be no requirement to furnish the licensing board with a complete certificate or with the other certificate. That will be in existence in any case.
    Our legal advice is that if a licensing board were to withdraw the licence for the whole of the seven days on an application for Sunday opening, the sheriff would be bound to uphold the appeal of the licence holder. It is important to say in terms of our desire to bring public houses in Scotland up to standard that if a publican applies for a licence to open on a Sunday and is refused because it is considered, by virtue of the nature of the premises, or some other reason, that it would cause a public nuisance, it goes without saying that the licence holder would be under notice to get his premises brought up to standard. If he did not do so, I imagine that at the next quarterly meeting of the licensing board much more serious action would be taken. All the provisions that will be triggered off by the mere fact that applicants have to apply to open on a Sunday are contained in the application for a new certification, with the exceptions that I have defined.
    The hon. and learned Member for Kinross and West Perthshire (Mr. Fairbairn) said that they are very poor fall-back provisions. I do not accept that, but I think that the House will have gathered from the tone of my voice that I accept that they are a poor second best from my point of view—and I speak personally. I have always been against the opening of public houses on a Sunday. I have been reinforced in my view in the past two years, having done the job that

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    I have been doing in Government and having seen the effects of crime related to alcohol.
    In 1974 there were approximately 19,000 people committed to Scottish prisons, and 9,000 of them were committed for crimes related to alcohol. I do not hold a monopoly of concern, but I share the concern of Opposition Members and Members from all parts of the House. I could not bring myself to turn a blind eye to the effects of alcohol that I have seen. I was always opposed to Sunday opening, and in the past two years my views have been reinforced.
    I said at the beginning that I was not so naive as to deceive myself into the belief that I could change the views of those whose minds are made up. Therefore, I shall not attempt to do so. There have been many important decisions made while Scotland slept, and we are just about to make another. I trust that the decision that the House makes will be one in favour of the new clause and that the Bill will be restored to its original position.
    Question put, That the Clause be read a Second time:—
    The House divided: Ayes 34, Noes 55.
    [For Division List No. 285 see col. 613]
    Question accordingly negatived.

  New Clause 2

    OCCASIONAL PERMISSIONS
    '(1) A licensing board may grant an occasional permission to a person representing a voluntary organisation or a branch of a voluntary organisation authorising him to sell alcoholic liquor during such hours and on such day as the board may determine, in the course of catering for an event, arising from or related to the activities of the organisation, taking place outwith licensed premises.
    (2) Not more than four occasional permissions may be granted in any one year on behalf of the same voluntary organisation or the same branch of a voluntary organisation.
    (3) In granting an occasional permission under this section, which shall be in writing the licensing board may impose such conditions as it thinks fit including a condition as to the type of alcoholic liquor which may be sold under the permission, and if the person to whom the permission is granted contravenes such a condition he shall be guilty of an offence.
    (4) The provisions of section 68 of this Act shall apply to any premises or place in respect of which an occasional permission is granted as they apply to licensed premises, with the substitution of references to the holder of the permission for the references to the holder of a licence.
    (5) The provisions of section 85 of this Act shall apply to any premises or place in respect of which an occasional permission is granted as they apply to premises in respect of which a licence (other than an off-sale licence) is in force.
    (6) The person to whom an occasional permission is granted shall ensure that the provisions of this Act or any byelaws or regulations made thereunder relating to the conduct of licensed premises are observed in the premises or place in respect of which the permission was granted as if he were the holder of a public house licence, and if he contravenes this subsection he shall be guilty of an offence:
    Provided that it shall be a defence for any person charged with an offence under this subsection if he proves that he used due diligence to prevent the occurrence of the offence.
    (7) Subsections (7) to (9) of section 35 of this Act shall apply in relation to applications for occasional permissions as they apply in relation to applications for occasional licences.'.—[Mr. Harry Ewing.]
    Brought up, and read the First time.
    Mr. Harry Ewing: I beg to move, That the clause be read a Second time.
    Mr. Deputy Speaker (Mr. Bryant Godman Irvine): With this it will be convenient to discuss Government Amendments Nos. 36 and 96.
    Mr. Ewing: New Clause 2 revises the new subsection (11) added to Clause 35 in Committee. The new subsection allows a licensing board to grant an occasional licence to an individual representing a bona fide organisation. The clause amends and extends this provision by adjusting it to the language of the Bill. Amendment No. 36 removes subsection (11) of Clause 35 and Amendment No. 96 provides penalties for offences under New Clause 2.
    Subsection (11) of Clause 35 was added in Committee after a Division on an Opposition amendment designed to give effect to a Clayson recommendation that a licensing board should have power to grant not more than four occasional licences a year to an individual representing a bona fide organisation authorising the sale of liquor at a particular function on a specified day. Clayson had in mind small voluntary organisations

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    with a social or sporting purpose whose concern was to operate a bar for their own enjoyment and incidental profit on a few brief occasions during the year. We accept that there is a case for such occasional authorities for organisations and do not wish to challenge the principle of subsection (11).
    The purpose of the clause is to replace subsection (11) with a separate clause revised in line with the terms of the rest of the Bill. A separate clause seemed desirable because the remainder of Clause 35 deals with the grant of an occasional licence to someone who already holds a licence. Likewise, a separate name for the authority conferred seemed to be desirable and "occasional permission" is suggested.
    Subsection (1) empowers a licensing board to grant an occasional permission to a person representing a voluntary organisation or a branch of a voluntary organisation authorising him to sell alcoholic liquor on a specified day and at a specified time in the course of catering for a function outside licensed premises.
    Subsection (2) restricts the grant to not more than four occasional permissions a year for any one organisation or branch.
    Subsection (3) empowers a licensing board to attach such conditions as it thinks fit, including a condition as to the type of liquor that may be sold, to an occasional permission, which shall be in writing, and makes breach of a condition an offence.
    Subsection (4) applies the provisions of Clause 68, dealing with the protection of young persons, to the holder of an occasional permission and the premises for which it is granted, as if they were respectively a licence-holder and licensed premises.
    Subsection (5) applies the provisions of Clause 85.
    Subsection (6) requires the holder of an occasional permission to ensure that the provisions of the Bill relating to conduct of licensed premises are observed in the premises for which the permission is granted as if he were the holder of a public house licence.
    Subsection (7) applies the procedural provisions in subsections (7) to (9) of Clause 35 for applications for occasional
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    licences to applications for occasional permissions.
    Amendments Nos. 36 and 96 are consequential to New Clause 2. Their effect is to remove subsection (11) of Clause 35, which is to be replaced by New Clause 2, and to provide maximum penalties of £100 for the two offences created by the clause.
    The maximum penalty for breach of a condition of an occasional permission is set at the same figure of £100 as the maximum penalty for breach of a condition of an occasional licence under Clause 35 and breach of a condition of grant of an extension of permitted hours under Clause 64. The maximum penalty for failing to ensure good conduct at the function for which the occasional permission has been granted has been set at the higher of the two maximum penalties—£100 and £50—provided for similar offences on the part of a licence holder. This emphasises the responsibility placed on the person seeking an occasional permission.
    Mr. Hector Monro: I am grateful to the Minister for this happy solution to an important debate on a small issue in Committee. We always accepted that our subsection (2) might not have been correctly drafted. The conclusion which the Minister reached on the subsection in favour of the new draft is much the best because it is correctly redrafted. We are grateful to the hon. Member for taking the trouble to do this. I welcome the addition to the Bill.
    Mr. Teddy Taylor: I hope the Minister will answer a few questions on this important new clause because it involves a major change in principle. Up to the present it has been possible for organisations to hold a function and to get a licence only if they had an existing licence holder. That is now being done away with and the organisation itself can organise a bar and get the profit.
    Obviously, as we have seen from the previous law on licensing there is a danger of escalation, and with this new clause as drafted there is a danger that it might be subject to abuse. The abuse I can see is the reference to an organisation or branch of an organisation. We debated a great deal in Committee the drinking habits of Dumfries Conservatives because Dumfries is one of the most powerful and

    487
    strong associations in the country. I am aware that it has a number of branches. The same would probably apply to Dumfries Rugby Club. I wonder whether it would be possible for each branch of each organisation to get four occasional permissions a year, even though the cash proceeds were going to the same local organisation. Is it possible, in an organisation having five or six branches, for each to hold such a function, to have an occasional licence and devote the proceeds to the funds of the organisation through the different branches?
    The Secretary of State is well aware of the special problem which arose where each branch had special licences. It was a way round the situation. Is there any difficulty for an organisation in establishing a new branch every time it runs out of special permissions?
    3.45 a.m.
    The Minister may say that licensing boards will keep a close watch on the situation, but would it be possible for an organisation to behave as I have suggested and to have occasional permissions virtually every week? Will there be a limit on the number of occasional licences which can be obtained by any organisation in a year?
    We shall be discussing later Government Amendment No. 87 which reduces from five years to three years the waiting time for existing "dry" or limitation areas. My attitude to intervening amendments will depend upon whether the Government intend to go ahead with that amendment. How would such an amendment affect the current situation? May we also be told how occasional licences apply to existing "dry" licences?
    A similar amendment to No. 87 was tabled in Committee, but after I had put forward some strong arguments, my hon. Friends decided not to proceed with it.
    Mr. Harry Ewing: I thank the hon. Member for Dumfries (Mr. Monro) for his kind words and for his acknowledgment that we have produced a clear solution to the problem that he raised in Committee.
    I can tell the hon. Member for Glasgow, Cathcart (Mr. Taylor) that occasional permissions are not related to licences. They will be given to people
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    who are not licence holders but are representatives of bona fide organisations. The number of permissions is limited to not more than four a year and the conditions are tightly drawn to ensure that the restrictions are complied with.
    Mr. McCartney: Could my hon. Friend clarify the position still further? In talking about an organisation, do we mean organisations in the constituent sense in which the hon. Member for Glasgow, Cathcart (Mr. Taylor) referred to them, irrespective of the number of constituent elements in the organisation?
    Mr. Ewing: The wording was deliberately chosen to cover the branches of organisations.
    Mr. Teddy Taylor: If a branch gets four permissions and needs another four, does it not just have to set up another branch? Will it not also be able to get yet another four by setting up a third branch?
    Mr. Ewing: It will be for the board to decide whether conditions are being abused.
    Question put and agreed to.
    Clause read a second time, and added to the Bill.

  Clause 1

    LICENSING BOARDS
    Mr. Teddy Taylor: I beg to move Amendment No. 2, in page 2, line 3, after 'council', insert
    'or of justices of the peace appointed by the council'.
    This is an important amendment and I hope that the Government will be able to make some concession.
    At present we have a situation where licensing courts in Scotland are composed primarily of councillors and justices of the peace. There are several advantages in having justices of the peace as well as councillors. There is always some merit in having people who are net primarily answerable to electors. That is an important factor if one has to make decisions of a semi-judicial nature whether a licence should be granted.
    In addition, one of the major and important advantages of having justices of the peace is that it helps achieve a

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    quorum in the licensing court. Any hon. Member who has experience of local government, particularly in Glasgow, and in some other areas as well, will accept that one of the major problems we have at present is getting a quorum for a licensing court. That quorum is often far below the actual membership of the licensing court, as the Minister will be aware.
    At present it seems that we are proposing to change over to elected councillors only. One of the problems is that councillors are extremely busy people and spend a great deal of their time attending council meetings and committees and so on. I would suggest that it would be difficult in a city area for the councillors to spare the additional time to attend the licensing board or licensing court. It must also be accepted that the problem will be greater in country areas. While in the Glasgow District Council meetings are held every single day, I am afraid that in some country areas it is the normal parctice to have meetings perhaps once a week or once a fortnight and that often involves long journeys on the part of councillors.
    If we are to have a situation where people have to travel 30, 40 or 50 miles to go to a council meeting of either a regional or district council, and there are some people who are members of both, it will impose a great burden on those people if they also have to attend meetings of the licensing board.
    The Minister has said that one of the reasons why the Bill has been introduced is to make the procedure more efficient and ensure that injustice is rooted out. I am scared that if we go ahead on the basis of appointing councillors to these boards, the work of the boards will be frustrated simply because it will not be possible to get sufficient councillors to attend the meetings. I hope that the Minister has made some inquiries into this, and that he can give me some indication of the experience of licensing courts in particular areas and the difficulty of getting a quorum.
    In my own area there have been many instances when frantic telephone calls have been made to councillors at their businesses and cars have had to be sent simply because arrangements have been made for a very long agenda considering
    490
    applications for licences and there simply were not sufficient members of the licensing court available.
    I suggest that this problem could be overcome by having justices of the peace on the boards—because they are often people who are used to public work—who have perhaps been councillors for many years and have played a great part in public service. In my own area we have two justices of the peace who live not far from me. One of them was a councillor in Glasgow for some time and the other unsuccessfully stood for the council on several occasions. They are people who have not only had experience of public work but are anxious to do some public work. In those circumstances they are ideal people to serve on the licensing board and to do a very good job.
    It is difficult to decide what should be the proper balance and whether we should have a 50-50 ratio or a two to one ratio or a ratio of three to one. I would accept that there may well be merit in saying that the majority of the licensing boards should consist of councillors and a smaller number of justices of the peace. A balance of three to two or two to one would perhaps be appropriate.
    Can the Bill as drafted cope with the situation when a quorum is not available? It seems to me that nothing can be done without the amendment. A great deal of unnecessary expenditure will be incurred when licensing boards meet, as is the case now with licensing courts. The applicant will have his expensive professional advisers. Many objectors have to take a day off work and travel, often considerable distances. Nothing is more likely to destroy local democracy than objectors having to turn up time after time because a quorum cannot be maintained. The Minister may say that that will not happen, but it happens now, even with justices of the peace on the licensing courts.
    Government Amendment No. 87 will create great additional pressure on the boards. According to the Clayson Report, a small number of areas in Scotland are "dry". Amendment No. 87 was a great shock to me, since it proposes within three years to abolish "dry" areas and to create a gold rush of prospective publicans. Many local people will want to object. Is the Minister satisfied that the boards will

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    have enough members to provide the necessary facilities? If the period were five years, the teething troubles might be overcome, but three years is too short.
    I thought at first that this amendment and others in my name would not be necessary, but the implications of Amendment No. 87 convince me that they are important, particularly for parts of Glasgow and other "dry" areas. I hope that the Government will admit their error. Without the amendment, nothing can be done if there is not a quorum of elected councillors.
    4.0 a.m.
    There is no need for me to tell the House of Commons at this hour of the morning about the growing volume of work that councillors have to do. One of the surprises of local government reorganisation has been the number of hours that councillors have to put in. Re-organisation has involved councillors in doing more work of a kind that they did not have to undertake under the previous set-up.
    There is a danger that the licensing board system will creak at the seams because it will not be possible regularly to get a quorum. This difficulty could be overcome if we avoided putting undue pressure on the boards early in their existence. I suggest a five-year spell for them to get over the initial difficulties. I am sure that they will be able to cope with their normal work. However, if we put an extra burden on them by having the 16 dry areas coming in within three years, we shall create an intolerable situation.
    I hope that the Minister, if he cannot accept my amendment, will accept the justice of the argument—that, if he is prepared to take a gamble, we must remove any special problems which may make the work of the licensing boards more difficult.
    The Minister, in a very good speech, suggested that we take a gamble on Sunday licensing. We know that that decision was taken by a majority of the House, but some Members are still apprehensive about it. I suggest that the Minister is taking another gamble by saying that we should have only councillors on the licensing boards. That gamble could result in frustration and time wasting and objectors and applicants coming to meetings which will not take place.
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    If, on the other hand, the Minister were prepared to say "I will have another think about Government Amendment No. 87, perhaps between now and when the Bill goes to the House of Lords" there would be a good argument for saying "We shall give the new licensing boards a chance by having only councillors on them." Unless the Government is prepared to remove the special problem that could arise in three years from now, there will be a need to strengthen the boards by having on them justices of the peace as well as councillors.
    I hope that I have convinced the Minister that we need Amendment No. 2 unless the Government are prepared to reconsider their astonishing Amendment No. 87 between now and when the Bill goes to the other place.
    Mr. Millan: I cannot recommend the House to accept the amendment. This is a matter of principle which was recommended by Clayson and was fully debated in Committee. The principle that we adopted was that members of licensing boards should be local councillors.
    If there is a problem in any area in finding a sufficient number of people for a licensing board meeting, that should be dealt with by having the arrangements for a quorum properly expressed in the Bill. Later amendments have been tabled to deal with the quorum.
    The Government take the realistic view that a quorum should be effective. That is the way to deal with any difficulties about getting sufficient people to run a meeting of the board. We do not think that we should go back on the established principle, which was fully considered, that it is appropriate, in matters of local importance of this kind that the members of the licensing board should be local councillors. To add justices of the peace would be to offend that principle, and to have those justices of the peace appointed by the local authority. as is suggested in the amendment, would not make sense.
    For those reasons. I ask the House to reject the amendment.
    Mr. Teddy Taylor: I am not convinced by the Secretary of State's argument. He did not deal with my second point at all.

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    I suggested two alternatives. There must either be a reserve of justices of the peace —and I do not suggest that we pack the boards with JPs—or the Minister must be prepared to accept a quite intolerable situation in three years time. At that stage a number of "dry" areas—and there are a number of them—will put in their licence applications. There is a terrific difference between the situation in "dry" areas and that in "wet" areas where the licensing boards just deal with applications as they come in one by one, quarter by quarter at an even rate. But if in three years we shove on top of that an extra work load, special problems will be created.
    Would it not be wise—and the Secretary of State accepted my argument because he deliberately avoided answering it—if the right hon. Gentleman acknowledged the problem? He need not accept Amendment No. 2 but he should reconsider moving Amendment No. 87. If he did that it would not be necessary for me to spend time talking on the other amendments in my name. I hope that the Secretary of State will make a small concession.
    I asked what will happen if the licensing boards fail to get a quorum and what is the procedure for dealing with that but I received no answer. The Bill does not safeguard that position. What could be done if a quorum were not found three weeks in a row? The answer appears to be "Nothing at all".
    If the Secretary of State cannot accept Amendment No. 2, will he answer two specific questions? First, what is the fall-back position if there are repeated failures to achieve a quorum? Secondly, does he not accept that many of the teething troubles would be removed if he reconsidered the provisions in amendment No. 87?
    Question put, That the amendment be made:—
    The House divided: Ayes 10, Noes 51.
    [For Division List No. 286 see col. 613.]
    Question accordingly negatived.
    Mr. Harry Ewing: I beg to move Amendment No. 3, in page 2, line 4, at end insert—
    '( ) Where a district or islands area is divided into licensing divisions, then unless the
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    Secretary of State otherwise directs, not less than one third of the members of the licensing board for a licensing division shall be councillors for a ward or electoral division within the area of the licensing division'.
    This amendment meets a commitment we gave in Committee. I hope that it will be acceptable to the Opposition.
    Amendment agreed to.

  Clause 2

    DISQUALIFICATION OF INTERESTED PERSONS
    Mr. Millan: I beg to move Amendment No. 4. in page 3, line 19, leave out 'or tenant' and insert 'tenant or subtenant'.
    Once again, this is an amendment which fulfils an undertaking given in Committee. It would disqualify a member of a licensing board from acting in the granting of a licence to a premises in which he is a subtenant.
    Amendment agreed to.

  Clause 4

    MEETINGS OF LICENSING BOARDS
    Mr. Harry Ewing: I beg to move Amendment No. 5, in page 4, line 5, leave out 'six' and insert 'eight'.
    This amendment meets a commitment given in Committee to the hon. Member for Fife, East (Sir J. Gilmour). I hope that it meets with his approval.
    Mr. Teddy Taylor: Will the Minister answer a few questions on this amendment, which substitutes "eight" for "six"? This means that the clause will now read:
    "shall hold a meeting in January, March, June and October of each year beginning on a date in each such month fixed by the licensing board at least eight weeks prior to the meeting."
    What will be the procedure in the event of one of the regular meetings and the one which succeeds it not taking place because it is not possible to get a quorum? How can the board keep to the eight-week notice period if the regular quarterly meeting cannot be held on the appointed day, or the week after or the week after that, because the board cannot arrange a quorum? This will arise in a limited number of areas if the Government will not be flexible and accept a

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    later amendment which is on the Amendment Paper.
    Mr. Ewing: As the hon. Member knows, this was discussed at length in Committee. It has nothing to do with the size of the quorum. We gave a commitment that we would delete six weeks and insert eight. We have done that, and it is acceptable to the hon. Member for Fife, East and his hon. Friends, as I understand it.
    Amendment agreed to.

  Clause 5

    ARRANGEMENTS FOR DISCHARGE OF FUNCTIONS OF LICENSING BOARDS
    Amendment made: No. 6, in page 4, line 34, at end insert—
    '(gi) making a decision on an application for Sunday opening under Part I of Schedule (Sunday opening of premises in respect of which a public house licence or refreshment licence is or will be in force and Sunday restriction orders relating to licensed premises) to this Act;
    (gii) making a decision as regards a Sunday restriction order or the revocation of such an order under Part II of Schedule (Sunday opening of premises in respect of which a public house licence or refreshment licence is or will be in force and Sunday restriction orders relating to licensed premises) to this Act;'.—[Mr. Milian.]
    Mr. Rifkind: I beg to move Amendment No. 7, in page 4, line 37, after '(3)', insert—
    'A licensing board may fix its own quorum which shall not be less than'.
    Mr. Deputy Speaker: With this we shall take Government Amendment No. 8, and Amendment No. 9, in page 4, line 38, leave out shall be a quorum'.
    Mr. Rifkind: I do not wish to speak at length on Amendment No. 7 because it is a minor drafting improvement to the clause. Government Amendment No. 8, however, reverses a decision taken by the Committee that a quorum for a meeting of a board should be a minimum of five rather than three. I think it is unfortunate that the Government have not accepted the Committee's decision because it provided an important safeguard in many areas of Scotland where the size of a licensing board is likely to be rather small. Important decisions may be taken by only three people attending the meeting.
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    If the Government amendment is accepted, a decision can be carried out by two votes to one removing a person's livelihood or approving a highly controversial licence. Clearly this is sometimes necessary with a very narrow majority, but it is at least acceptable where considerable numbers of members make the decision. Where only three persons might be present, with two in favour of a particular proposition which might have serious consequences and one against, the applicant or objector would have good grounds for feeling genuinely aggrieved, and this would be of great importance. It would be particularly significant in rural areas, which will have smaller licensing boards.
    Mr. Harry Ewing: I ask the Opposition to withdraw their Amendment No. 7 and not to press Amendment No. 9; otherwise I must ask the House to reject them. I ask the House to agree to Government Amendment No. 8.
    As I explained in Committee, licensing courts have been taking decisions in Scotland for many years on a quorum of two, and the Bill provided, before the amendment was made in Committee, that there should be a quorum of three in the new licensing boards. Since the decision of the Committee to raise the figure from three to five, we have con-suited the Convention of Scottish Local Authorities on the implications for local authorities of the increase, which puts the minimum quorum at the same level as the minimum number of members of a licensing board in terms of Clause 1(4). Of 14 chief executives of smaller authorities invited to comment by the convention, 11 would prefer to have a minimum quorum of three and a minimum membership of seven.
    The convention made the point that an increase to seven in the membership of a licensing board could adversely affect the ability of councils with a small membership to constitute licensing boards, For example, Skye and Lochalsh District Council has a membership of 10, of whom two are disqualified from membership of licensing boards by virtue of being licence-holders. This district council would have difficulties in providing a minimum membership of seven.
    The convention also consulted the chief executives of three district councils the

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    memberships of which range from 20 to 29 and which operate licensing divisions. Their view is that, if larger minimum numbers are approved for board membership and the quorum, this could lead to centralisation of licensing functions in their districts and abolition of the licensing divisions. This would deprive these authorities of the option to create divisions.
    The overall view of the convention is, on balance, to favour a minimum quorum of three and a minimum membership of five. In the light of this view my amendment would restore the minimum quorum to three, leaving the minimum membership at five as in Clause 1(4). In commending this amendment to the House, I am conscious that it may disappoint the hon. Member for Dumfries (Mr. Monro) who, in moving his successful amendment in Committee expressed his concern that a quorum of three was too small for a licensing board in a rural area. I remind him that three is an increase of 50 per cent. over the present minimum of two.
    Mr. Teddy Taylor: I am disappointed that in this as in other cases the Government have changed their minds on certain amendments since the Committee stage. It was a happy and harmonious Committee with no accusations of bad faith. It is unfortunate that at this late stage, in the case of this amendment and a later one, the situation would appear to have arisen that there is bad faith by the Government.
    I wish to ask one or two brief questions that arise from Government Amendment No. 8. If the quorum is to be three instead of five, does that figure apply to all the deliberations of the licensing board, only to the beginning of its meeting or to times when decisions are made? If the meeting of a board lasted for 45 minutes or two hours, would it be adequate to have a quorum of three at the beginning and a quorum of three when votes took place, or would it be necessary to have a quorum of three all the time?
    4.30 a.m.
    As it is an important change of principle to reduce the quorum from five to three, whose obligation is it to declare whether a quorum is present? If the number is to be reduced from five to
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    three, is it the duty of the clerk to the board to draw the attention of members present to the fact that a quorum is not present, or is it his duty to do so only if one of those appearing before the board brings it to his attention?
    If we accept the amendment and reduce the quorum to three, will that mean that a licensing board's proceedings cannot continue unless there are three members of the board present at all times between decisions, while decisions are being considered and after they have been taken? It is important that we should have an assurance that three members will be present at all times when matters are being considered and decisions taken by the licensing board if we are to take this major step.
    If there are to be three members present all the time, whose duty will it be to draw the clerk's attention to this provision? Did the Minister decide to introduce the amendment primarily because he believed that there would be a problem in providing five members because of the special and onerous duties of councillors and the decision to remove justices of the peace from membership of the boards? Bearing in mind the excellent arguments put forward by my hon. Friend the Member for Dumfries (Mr. Monro) in Committee, is it the Minister's argument that three should be accepted instead of five because it is more efficient or more practical?
    Did the Minister table the amendment because it was also his intention to introduce Amendment No. 87 and because he appreciated that there would be a problem of having regular meetings for some licensing boards in certain areas in three years' time? I think it would help the House to consider whether this is a good or bad amendment if we knew the reason for the Minister having tabled it. I listened to his arguments carefully and I was not entirely convinced by them. It seems that there must have been a special reason for the Government to have tabled the amendment, and I should like to know whether it was that they decided out of the blue to table a later amendment, which happens to be No. 87.
    Mr. Harry Ewing: A quorum is a quorum. If the quorum is lost, the meeting is lost. I tabled the amendment because of the great difficulties involved

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    for the small local authorities. We shall discuss Amendment No. 87 when we come to it.
    Amendment negatived.
    Amendment proposed: No. 8, in page 4, line 38, leave out "five" and insert "three".—[Mr. Millan.]
    Question put, That the amendment be made:—
    The House divided: Ayes 38, Noes 23.
    [For Division List No. 287 see col. 615.]
    Question accordingly agreed to.
    Mr. Millan: I beg to move Amendment No. 10, in page 5, line 4, leave out "(g)" and insert "(gii)".
    Mr. Teddy Taylor: This amendment falls within the second group, which was debated with New Clause 1. Will you, Mr. Deputy Speaker, explain whether acceptance of the amendment will preclude a debate on Amendment No. 49, which is basically the referendum amendment in the third grouping? I believe that it should be possible to vote on but not to debate Amendment No. 49 even if we accept Amendment No. 10. This affects the position of anyone who wants to vote on Amendment No. 10. I was advised by the Clerks that it would be possible to vote on Amendment No. 49 but not on Amendment No. 46.
    Mr. Deputy Speaker: As I see it, Amendment No. 49 fell with Amendment No. 6.
    Amendment agreed to.

  Clause 7

    WITNESSES
    4.45 a.m.
    Mr. Millan: I beg to move Amendment No. 11, in page 5, line 31, leave out Clause 7.
    Mr. Deputy Speaker: With this it will be convenient to take Government Amendments Nos. 86 and 94.
    Mr. Millan: The effect of the amendment would be to take away the power of a licensing board to cite and examine witnesses. We undertook to look at this in Committee. Having done so, we find
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    that the power is not necessary and that it would be better for it to be removed. It is rarely used.
    Amendment agreed to.

  Clause 8

    CLERK OF LICENSING BOARDS
    Mr. Millan: I beg to move Amendment No. 12, in page 6, line 9, at end insert
    'and the clerk of a licensing board shall be an advocate or a solicitor'.
    This amendment is in response to a point made in Committee and requires the clerk of a licensing board to be legally qualified.
    Amendment agreed to.
    Mr. Millan: I beg to move Amendment No. 13, in page 6, line 16, leave out 'a licensing' and insert 'that'.
    The amendment slightly restricts the prohibition on the clerk of a licensing board who wishes to act as a solicitor in proceedings before licensing boards. Again, it is a point raised in Committee which is now taken care of.
    Amendment agreed to.

  Clause 11

    APPLICATION FOR LICENCE
    Mr. Harry Ewing: I beg to move Amendment No. 15, in page 7, line 33. at end insert—
    '( ) In the case of an application for the grant or provision grant of a new licence, the applicant shall, not later than three weeks before the first day of the meeting of the board at which the application is to be considered, give notice in writing of the application to every occupier of premises situated in the same building as the premises to which the application relates'.
    This is an important amendment which meets the commitment given in Committee to my hon. Friend the Member for Edinburgh, Central (Mr. Cook) and other hon. Members on both sides of the Committee that individual written notices of an application for a licence for premises in tenement property should be sent to occupiers of the tenement. The amendment places on obligation on the applicant to inform the individual tenants in writing of the application for a licence. I hope that the wording meets the requirements of my hon. Friend.
    Mr. Robin F. Cook: The amendment meets the precise points expressed in Committee. It gives to residents and owners in property adjacent to public houses a right which will be very much appreciated. It should have been given long ago. I am glad that the Government took this opportunity to put the matter right in the Bill.
    Amendment agreed to.
    Mr. Rifkind: I beg to move Amendment No. 16, in page 7, line 41, at end insert—
    '(6) On receipt of an application of a kind referred to in subsection (5) above, and until the first day of the meeting of the board at which the application is to be considered, the clerk of a licensing board shall make the application, together with the documents lodged therewith, available for inspection by members of the public during normal office hours'.
    The amendment seeks to improve the facilities available to the public to note the information which might be useful to them in deciding whether to oppose or accept an application which has been made. The amendment makes available far more information than the knowledge statutorily required under the Bill in its present form, and I hope that the Minister will accept it.
    Mr. Harry Ewing: We recognise the usefulness of this amendment and we are prepared to accept it.
    Amendment agreed to.

  Clause 15

    FURTHER APPLICATION FOR NEW LICENCE WHERE PREVIOUS APPLICATION REFUSED
    Mr. Rifkind: I beg to move Amendment No. 18, in page 9, line 39, at end insert
    or unless there has been a material change in circumstances since the date of the refusal of the first-mentioned application'.
    I am so overwhelmed by the Minister's generosity on the last amendment that I hope it will be repeated on this one It relates to a situation in which a licensing board has refused an application. The Bill states that no subsequent application may be made within a period of two years. In general I find that acceptable, but we think that there should be a qualification of the absolute bar on a subsequent application within two years.
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    It would seem reasonable that if a material change of circumstances had occurred an applicant should at least be entitled to present a new case explaining the change of circumstances to the licensing board, so that it may reconsider the situation. There would be no obligation for it to change its decision, but if there has been a great material change in circumstances, notwithstanding that the two-year period has not elapsed, it is not unreasonable to allow the board to reconsider the matter and to come to an appropriate decision. I hope that the Minister will feel able to accept this amendment.
    Mr. Harry Ewing: One of the things not affected by inflation is my generosity, but I am sorry that I cannot accept the amendment. The debate is similar to the one we had in Committee. There are two issues. One relates to the applicant for the licence and the other to the objector. I would be unfair to subject the objector to a continual process of going back to the licensing board. The board has the flexibility to reconsider an application within the two-year period if a change emerges. I am bound to adhere to the Committee's decision not to accept this proposal.
    Amendment negatived.

  Clause 17

    OBJECTIONS IN RELATION TO APPLICATIONS
    Mr. Harry Ewing: I beg to move Amendment No. 19, in page 10, line 14, after relates', insert
    or any organisation which in the opinion of the Board represents such persons'.
    Mr. Deputy Speaker: With this it will be convenient to take Amendment No. 20, in page 10, line 18, at end insert
    or, where there is no community council, a community or residents association which, in the opinion of the licensing board, represents a significant body of opinion among persons residing in the neighbourhood of the premises'.
    Mr. Ewing: Amendment No. 19 meets a point made in Committee by my hon. Friend the Member for Edinburgh, Central (Mr. Cook). I explained earlier this morning that we had had a difficulty in defining a residents' or tenants' association, and we decided to use the words in this amendment.

    503
    Amendment No. 20 provides that, where there is no community council for the area in which the premises are situated, a right of objection will be conferred on a community or a residents' association which, in the opinion of the board, represents a significant body of opinion among persons residing in the neighbourhood of the premises to which the application relates.
    Amendment No. 19 has the important effect of adding to the list of competent objectors any organisation which in the opinion of the board, represents persons owning or occupying property in the neighbourhood of the premises to which the application relates. In practice, it will most likely be a residents' or tenants' association, but any organisation which can satisfy the board that it represents such persons will be allowed to lodge an objection to the granting, renewal or permanent transfer of the licence.
    Amendment No. 20 seems unnecessary in view of our important amendment which affects the rights of the individual.
    Mr. Buchanan-Smith: I welcome the Government amendment and am prepared to accept it and not press Amendment No. 20. 1 pay tribute to the debate initiated in Committee by the hon. Member for Edinburgh, Central (Mr. Cook), whose representations have been met in Amendment No. 19.
    Mr. Robin F. Cook: I welcome the Government amendment. It is as comprehensive as we could have hoped for and recognises that it is important to strengthen the rights of objection for people neighbouring public houses—particularly in the light of our earlier vote on Sunday opening. The Government amendment entirely meets the points raised in Committee.
    Amendment agreed to.
    Mr. Buchanan-Smith: I beg to move Amendment No, 21. in page 11, line 17, leave out 'practicable' and insert 'possible'.
    This amendment covers an important issue. Clause 17 deals with objections to licences and gives powers to chief constables to lodge objections at any time before the hearing of an application. In such cases the chief constable shall. where practicable,
    504
    "cause his objection to be intimated to the applicant before the hearing."
    I am concerned about the possible interpretation of the word "practicable". I do not suggest that chief constables would act irresponsibly, but the use of "practicable" leaves a slightly larger loophole for objections not to he intimated to the applicant. If "possible" is included, the test will be easier and so, too, will appeals to the sheriff court on the ground that a chief constable had not carried out his duty. This is not an amendment on which I would stick, but it seems to tighten up the Bill.
    Mr. Millan: I appreciate the reasons for the amendment and the way in which it was moved. This matter was discussed in Committee and we have considered it in detail since, but my advice is that the inclusion of "possible" would take us too far in the opposite direction and might impose unreasonable obligations on chief constables. The term "practicable" means that every effort will be made to carry out the functions imposed in the Bill. Anyone who did not try to do that would be in default.
    The matter which concerned the hon. Member for North Angus and Mearns (Mr. Buchanan-Smith) is covered by the wording of the clause, and "practicable" is the more usual word.
    Mr. Buchanan-Smith: I am grateful for the Minister's assurance. I beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.

  Clause 18

    GROUNDS FOR REFUSAL OF APPLICATION
    5.0 a.m.
    Mr. Donald Stewart: I beg to move Amendment No. 108, in page 12, line 13, at end insert—
    '(e) that an objection to the granting of a licence has been lodged by the district or islands council'.
    Clause 18 contains four grounds which must be satisfied before a licence can be granted. This means that the discretion which the licensing court previously enjoyed will have gone. I should explain that this arises out of a case in Stornoway a few years ago where the proprietor of a new hotel announced that he intended to open on Sunday, and this

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    caused great offence in the community. There was talk of a veto poll being oragnised, but had it been successful all the licences would have been at risk. It was therefore decided not to take the chance of cancelling all the licences in the burgh of Stornoway at that time.
    The amendment would meet the local viewpoint to some extent in that it applies only to single applications and would not have a blanket effect.
    Mr. Millan: With respect, the hon. Gentleman's explanation contained an important inaccuracy. Clause 18 gives ground for refusal. If one were to add the particular words contained in the amendment, the mere fact that a district council had objected to the granting of a licence would automatically mean the refusal of the licence. That is absolutely antithetical to the arrangements we are providing in the Bill.
    The local authority has a certain role, before the licensing board comes into play, in respect of the suitability of the premises and so on. However, to say that it is the end of the matter once a local authority has decided that it cannot grant a licence is taking things too far. The Bill contains a procedure for objections, but I do not think I need explain it at this late hour. We cannot simply write in an automatic power of refusal by the local authority. That would be taking the matter out of the hands of the licensing board and putting it into the hands of local authority decision. That cannot be right in the context of the Bill.
    Mr. Donald Stewart: I thank the right hon. Gentleman for his explanation and I see the substance of what he says. However, since the veto poll is bound to disappear eventually, some resort should be granted to a community which feels strongly about a particular licence.
    Question put, That the amendment be made.
    The House divided: Ayes 9, Noes 50.
    [For Division List No. 288 see col. 615.)
    Question accordingly negatived.

  Clause 20

    CANVASSING
    Mr. Munro: I beg to move Amendment No. 22, in page 13, line 19, after 'hours', insert
    'or any objector who is a licence-holder'.
    I am a little disappointed that there is no Government amendment put down to this clause. I appreciate that the Minister did not give any commitment in the assurances he gave to look at this matter again, but we feel strongly about canvassing by objectors. We agree that there should be no canvassing by applicants for licences, but we also feel that objectors should be in the same position.
    5.15 a.m.
    The Minister said that an applicant had a financial interest and that an objector had an environmental interest, and that he could see a subtle distinction between the two. Objectors could object on financial grounds because their business or interest was affected. The Minister should have given way on this issue after having considered it. If he is not prepared to accept the amendment, he should at least look at it once more and talk to his colleagues in the other place about the possibility of moving a similar amendment later. There is a strong case for putting objectors to an application in exactly the same position as applicants.
    Mr. Harry Ewing: We gave serious consideration to this matter and came to the conclusion that it would be wrong to single out one class of objector—namely, licence-holders—for prosecution for canvassing. Although we have sympathy with the argument, on balance we feel that it would be wrong to isolate a licence-holder by charging him with the offence. If a licence-holder were found to be canvassing against the application of another licence-holder, the suitability of that person to hold a licence under Clause 18 would be for the board to decide. For those balanced reasons, we ask that the amendment be withdrawn.
    Mr. Munro: I note what the Minister has said. I cannot say that I agree with him, but in the circumstances I beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.

  Clause 29

    GRANT OF LICENCE IN FORM OTHER THAN THAT APPLIED FOR
    Mr. Millan: I beg to move Amendment No. 26, in page 18, line 36, leave out Clause 29.
    In Committee hon. Members asked whether it was sensible to retain this clause, which allows the board to grant licences of a type other than that which is applied for. We do not think that there is any reason for the clause and we would like it to be deleted.
    Mr. David Steel: I do not understand why the Government wish to drop the clause. The Secretary of State has not explained the reason for doing so.
    Mr. Millan: No one can see the point of the clause. The local authorities believe that it will be of no use. I suppose that it was put in the Bill because it was copied from some other Bill, that the provision was in the previous Bill because it was copied from another Bill, and so on.
    Amendment agreed to.

  Clause 31

    ALCOHOLIC LIQUOR WHICH MAY BE SOLD UNDER LICENCE
    Mr. Harry Ewing: I beg to move Amendment No. 27, in page 19, leave out lines 22 and 23.
    Mr. Deputy Speaker (Mr. Oscar Murton): With this we may discuss Government Amendments Nos. 28, 29 and 95.
    Mr. Harry Ewing: These amendments meet the points made in Committee by the hon. Member for Edinburgh, Pent-lands (Mr. Rifkind). I hope that they meet the view which he expressed.
    Amendment agreed to.
    Amendments made: No. 28, in page 19, line 26, leave out
    'or spirits, wine and made-wine'.
    No. 29, in page 19, line 28, leave out
    or, as the case may be, spirits, wine or made-wine '.—[Mr. Harry Ewing.]

  Clause 33

    SUSPENSION OF LICENCE ON RECEIPT OF COMPLAINT
    Mr. Harry Ewing: I beg to move Amendment No. 30, in page 20, line 31, leave out licensed 'premises' and insert
    'vicinity of the licensed premises on the part of persons frequenting those premises'.
    The amendment would allow a licensing board, in considering the suspension of a licence after a complaint, to have regard to misconduct in the vicinity of the licensed premises on the part of customers of these premises.
    In Committee we had a lengthy debate about the matters to which a licensing board could have regard in considering the suspension of a licence on receipt of a complaint from a neighbouring owner or occupier, a community council, a church or the chief constable. In the clause as originally drafted, these matters where any misconduct by the licence-holder and any misconduct occurring in, or in the vicinity of, the licensed premises. An Opposition amendment to delete the words
    'or in the vicinity of'
    was carried, thus preventing a licensing board from taking into account misconduct in the vicinity of licensed premises in considering the grounds for suspending a licence.
    The debate in Committee was to some extent, I suspect, based on a misunderstanding of the relationship of subsections (2) and (3). Subsection (2) sets out the grounds on which suspension may be ordered; subsection (3) sets out matters to which the board may have regard in considering a complaint. It follows that only matters relevant to the grounds in subsection (2) could be had regard to under subsection (3).
    In moving the amendment in Committee which removed the original wording of subsection (3), the hon. Member for North Angus and Mearns (Mr. Buchanan-Smith) said:
    "I feel that subsection (3)(b) is too widely drawn and is putting the licensee in an invidious position in that he is virtually having to be answerable for misconduct of one sort or another which may have no relationship to his own conduct of his own premises and what may be going on in his own premises."—[Official Report, First Scottish Standing Committee, 15th June 1976; c. 360.]

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    We have tried to meet that criticism by making the misconduct to which regard may be had misconduct on the part of persons frequenting the premises. This is clearly conduct related to the premises, and I hope that this avoids the difficulties to which the hon. Member drew attention in Committee.
    Mr. Buchanan-Smith: I welcome the fact that the Government, although they have not accepted the amendment we made in Committee, have not sought to restore the exact original wording. They have tried to meet our point in part, but I still have certain reservations. I understand the difference between subsections (2) and (3). Subsection (2) is obviously vital to the licence-holder. Subsection (3) is not of such direct significance, although it has a certain importance.
    My concern in Committee which caused me to move the successful amendment was to make sure that the licence-holder was not to be held responsible by the board for conduct or behaviour which was outwith his control. However, accept that misconduct or nuisances occurring outside licensed premises as a result of what goes on in them should be taken into account. I entirely accept that, if there is habitual misconduct outside licensed premises and it is obviously related to the people using the premises, that would be a factor that the board would be entitled to take into account.
    However, I am anxious about the single incident, the one occasion when, in order to conduct his premises properly, the licence-holder perhaps puts out of his premises someone who is causing a nuisance. I am distinguishing between the one incident and the habitual nuisance, and I hope that the licensing board will treat them differently.
    While I do not expect the Minister to give a total assurance tonight, I hope he will say that he will consider this matter. If he feels that I have identified a problem, he might like to deal with it in another place.
    Mr. Teddy Taylor: My hon. Friend the Member for North Angus and Mearns (Mr. Buchanan-Smith) has made a good case, as he did on this subject in Committee. The discussion is recorded at columns 377 to 380 of Hansard for 15th June. Does the Minister confirm that
    510
    any suspension of a licence under this subsection will be subject to a right of appeal to a sheriff? If there is to be an appeal, as seems plain from subsection (2), it is unlikely that the court would uphold a suspension on the ground of only one incident.
    Can the Minister explain why he has used the words
    "on the part of persons frequenting those premises"?
    An appeal might be held up because of those words. The Government will be aware that the original Bill used the words
    "vicinity of the licensed premises".
    The Minister knows that in this and in other respects he has my support. We had a good relationship in Committee and it is sad that circumstances of which he is aware have destroyed that.
    Let us take the example of a street or city where there is very little trouble and no inconvenience. Let us say that a public house is built and that from that moment on there are people being sick and urinating in the nearby closes, that this is going on regularly and that with the arrival of the pub the situation changes from being peaceful, harmonious and pleasant. Will it be possible for the licensing board to defend itself in an appeal against the claim that the people concerned were not the people who frequented the premises?
    There need not be any evidence that those who are sick and urinating in the closes are the people who frequent the pubs. How will the licensing board get evidence that the nuisance is caused by people frequenting the premises? If the matter goes to the sheriff court, which is more than likely, precisely how is it intended that the board should defend its actions?
    5.30 a.m.
    Is it wise to put in the words
    "on the part of a person frequenting those premises"
    at all? Even if it were possible to prove they were not frequenting a public house, is it fair and reasonable, if a public house becomes a gathering ground for people who cause undue nuisance, that no action can be taken about the existence of that public house? Public houses on street corners tend to be gathering

    511
    areas. If a pleasant street is to be subjected to undue nuisance because of this, is it fair to restrict the basis of complaint in the way the Minister has done in this amendment?
    I am suggesting that the Government had it right in the Bill as originally drafted when the words were
    "misconduct occurring in the vicinity of licensed premises".
    By changing the words as they have done, they will make it very difficult for the boards to pursue an offence if a case is appealed to the sheriff, as it would be in the event of the suspension of a licence.
    Mr. Harry Ewing: On the points raised by the hon. Member for North Angus and Mearns (Mr. Buchanan-Smith), I give an assurance that we shall have another look at the wording and make any changes that we feel are necessary to meet the points. We hope that the wording in Clause 33(6), which defines the time limits in which a suspension would not take effect, and in subsection (8), which defines the question of appeals to the sheriff, will meet the points raised by the hon. Member. I think that this meets the point of the hon. Member for Glasgow, Cathcart (Mr. Taylor) also.
    Amendment agreed to.
    Mr. Deputy Speaker: Perhaps at this point I may make a statement. A little while ago the hon. Member for Glasgow, Cathcart (Mr. Taylor) asked whether a separate Division would be possible on Amendment No. 49. My predecessor ruled that it had fallen when Amendment No. 6 was agreed to. I have since taken further advice and have come to the conclusion that the two amendments are not incompatible. Therefore, there may be a Division on Amendment No. 49 if the hon. Member wishes.

  Clause 35

    OCCASIONAL LICENCE FOR PREMISES OTHER THAN LICENSED PREMISES OR CLUBS.
    Mr. Millan: I beg to move Amendment No. 32, in page 22, line 25, leave out 'licensed premises' and insert:
    'the licensed premises in respect of which he is the holder of a licence'.
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    This is a clarification of the intention of the clause.
    Amendment agreed to.
    Mr. Millan: I beg to move Amendment No. 33, in page 22, line 39, leave out 'infringes' and insert 'contravenes'.
    Mr. Deputy Speaker: With this we shall take Government Amendments Nos. 34, 31, and 35.
    Mr. Millan: These are drafting amendments which make the wording of the clause consistent with that in the rest of the Bill.
    Amendment agreed to.
    Amendments made: No. 34, in page 22, line 42, leave out 'infringed' and insert 'contravened'.
    No. 31, in page 23, line 2, leave out 'infringement' and insert 'contravention'.
    No. 35, in page 23, line 5, leave out 'infringement' and insert 'contravention'.
    No. 36, in page 23, line 30, leave out subsection (11).—[Mr. Millan.]

  Clause 36

    CONSENT OF LICENSING BOARD REQUIRED FOR RECONSTRUCTION, ETC. OF CERTAIN LICENSED PREMISES.
    Mr. Harry Ewing: I beg to move Amendment No. 37, in page 24, line 24, leave out subsection (3).
    This meets a commitment made in Committee that we would remove the subsection, and that is what the amendment does.
    Amendment agreed to.

  Clause 37

    POWER OF LICENSING BOARD TO ORDER STRUCTURAL ALTERATIONS ON RENEWAL OF CERTAIN LICENCES
    Mr. Harry Ewing: I beg to move Amendment No. 38, in page 25, line 35, leave out "decide" and insert "decides".
    Mr. Deputy Speaker (Mr. Bryant Godman Irvine): With this we may also discuss Government Amendment No. 39.
    Mr. Ewing: These are drafting amendments to insert the singular for the

    513
    plural form of words since "licensing boards" is treated elsewhere in the Bill as singular.
    Amendment agreed to.

  Clause 39
    POWER OF LICENSING BOARD TO MAKE BYELAWS
    Amendment made: No. 39, in page 26, line 12, leave out "their" and insert "its".—[Mr. Harry Ewing.]
  Clause 40

    APPEALS TO SHERIFF
    Mr. Millan: I beg to move Amendment No. 40, in page 27, line 18, at end insert:
    or in a case where reasons for a decision have been given under section 19(2) of this Act, within 14 days from the date of receipt of those reasons, which shall be presumed to have been received on the day after the date on which they were posted, except that in the case of reasons posted on a Friday or Saturday, they shall be presumed to have been received on the Monday next following'.
    In a case where a licensing board had been asked to give reasons for its decision, the amendment would allow a period of 14 days within which an appeal could be made to the sheriff, to run from the date of receipt of the reasons instead of from the date of the board's decision. It is an improvement which allows rather more time for the appeal.
    Mr. Teddy Taylor: I accept that the amendment is an improvement. Instead of allowing simply 14 days, it allows 14 days from the alleged receipt of the reasons. Cannot the Secretary of State guarantee that 14 days will be allowed from the actual receipt of the reasons? The reasons could get lost in the post and there would be unreasonable delay. With registered post and recorded delivery it would be possible to establish when the reasons were delivered. To assume that letters are delivered the next day after posting could lead to injustice. Sometimes they do not arrive the next day. Is it fair or wise to write in an assumption which may not be a fact?
    I am concerned also that there is no reference to the time of posting. The amendment simply says
    "on the day after the date on which they were posted".
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    If letters are posted very late at night, it is extremely unlikely that they will be delivered next morning. Is the right hon. Gentleman willing to look at these matters between now and when the Bill goes to the Lords, with a view to producing more realistic provisions?
    Mr. Gordon Wilson: If I read the clause correctly, unless an appeal is notified within the time limits given it will be time-barred. In the case of valuation appeals, if the time limits are not met the valuation appeal committee, in deciding to give a statement of reasons or to go ahead with an appeal to the Lands Valuation Appeal Court, has discretion to proceed even though the strict letter of the law has not been obeyed. There is case law to that effect. We have flexibility in the valuation system for appeals of a serious nature, but in the Bill a rigid time limit is set. Has the Minister considered the possibility of giving some form of discretion in relation to such appeals?
    Mr. Millan: I think that the wording about posting is common form, but I am willing to consider it to ascertain whether it is right. I am willing to consider whether the second point is covered by implication or by convention, or whether we should consider writing something into the Bill.
    Amendment agreed to.
    Mr. Harry Ewing: I beg to move Amendment No. 41, in page 27, leave out lines 21 and 22 and insert—

    '(a) erred in law;

    (b) based its decision on any incorrect material fact;

    (c) acted contrary to natural justice; or

    (d) exercised its discretion in an unreasonable manner.

    ( ) In considering an appeal grounded on paragraph (b) of subsection (3) above, the sheriff may hear evidence by or on behalf of any party to the appeal.'.
    Mr. Deputy Speaker: With this we may take Amendment No. 117, in page 27, leave out lines 21 and 22 and insert—

    '(a) erred in law;

    (b) based its decision on any incorrect material fact;

    (c) acted contrary to natural justice; or

    (d) exercised its discretion in an unreasonable manner.

    (3A) The Sheriff may in considering an appeal under subsection (3)(b) above hear evidence by or on behalf of any party to the appeal'.
    Mr. Ewing: Amendment No. 41 would provide an additional ground on which a sheriff might uphold an appeal against a licensing board's decision. It would enable the sheriff to hear evidence for or on behalf of any party on appeal on the ground that the board had based its decision on an incorrect material fact. The Law Society of Scotland made representations to us, and the amendment is designed to meet them.
    Amendment agreed to.
    Mr. Buchanan-Smith: I beg to move Amendment No. 42, in page 28, line 3, leave out Part III.
    Mr. Deputy Speaker: With this we may take Amendment No. 93, in page 88, line 10, leave out Schedule 2.
    Mr. Buchanan-Smith: The amendment is of a fundamenal nature and I do not necessarily expect the House to come to a complete conclusion on the matter at this stage. Perhaps it would have been more appropriate to deal with the matter in Committee, but it did not come to to my attention until later. I ask for no more than the Government to give this matter consideration between now and the Bill going to another place.
    In Part III and in Schedule 2 we are legislating for seamen's canteens. I imagined that it must be a matter of some importance, and further research revealed that in Scotland there are only two seamen's canteens, both of which are in Glasgow. Precedent for dealing with them separately in licensing law goes right back to the 1939 Defence Regulations.
    We are devoting seven clauses and one schedule to the two canteens in Glasgow. They may or may not need special treatment, but when dealing with licensing legislation the objective should be not merely to clarify but to try to ensure that we remove from old legislation such provisions as are not completely necessary.
    I move the amendment in order to ask whether we can remove an anachronism and whether we cannot tidy up the Bill slightly and shorten things. Is it relevant in 1976 to have the seven clauses and the schedule merely for the purpose of covering two canteens in the whole of Scotland? I do not feel strongly about this
    516
    issue in any sense, but as much other tidying has been done I merely ask why this possible piece of tidying was not carried out.
    5.45 a.m.
    Mr. Harry Ewing: It is very tempting to lighten the statute book by removing seven clauses and one schedule from any Bill. The difficulty is that these seamen's canteens—there are only two of them, as the hon. Gentleman said, and they are both in Glasgow—present some difficulties in definition. They cannot be defined as clubs because they are open to all seamen. They cannot be described as pubs because they are not open to the public. Off-sales from these places are not allowed either. They cannot be described as Service men's clubs because they are not under the control of the Government. The great difficulty was in finding a precise part of the licensing legislation where they would fit in.
    We shall have another look at it. If we can find a way to lighten the legislation we shall do so, but I say that with tongue in cheek in view of the difficulties involved.
    Mr. Buchanan-Smith: The Government might look at whether these seamen's canteens could be covered from the club angle in some way or other. That might be a sensible way in which to approach the problem. I beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.

  Clause 54

    PERMITTED HOURS IN LICENSED PREMISES AND REGISTERED CLUBS
    Mr. Buchanan-Smith: I beg to move Amendment No. 44, in page 37, line 38, leave out from 'and' to 'eleven' in line 39 and insert
    'provided that the premises are closed for any period of two and a half hours at the discretion of the licence-holder within the limits of the permitted hours'.
    Mr. Deputy Speaker: With this we may take Amendment No. 48, in page 38, line 5, leave out from 'and' to 'eleven' in line 6 and insert
    'provided that the premises are closed for any period of two and a half hours at the discretion of the licence holder within the permitted hours,'.
    Mr. Buchanan-Smith: This is an amendment of some substance. In Committee I tried to remove from the clause the afternoon break, for reasons I described. I was defeated in Committee, and I accept the principle of that defeat and that the afternoon break should be in the legislation. What I am now seeking is that the break should be flexible and left to the discretion of the licensee. Simply having an afternoon break between two specified times, as under the Bill as drafted introduces a certain rigidity. I believe that we should be seeking greater flexibility in order to help to improve attitudes, and to ensure that the licensing legislation reflects better the customs and habits of a particular area.
    In certain areas, for example, a public house may be near an industrial estate, a large factory, a shipyard or an engineering works where a particular kind of shift working is done. One might on occasion want to have the afternoon break coinciding with the time when one shift finishes and another shift comes in. By keeping the principle of the break but allowing the actual timing of it to be at the discretion of the licensee, it would be easier for the licensee to reflect more closely the habits and customs of the area in which the public house was situated and thereby to meet more nearly the needs and customs of those who might be using the premises. It is in that sense that I move the amendment.
    Mr. Tom McMillan: I agree with the amendment although I think that it is badly worded. I do not think that the hours should be left to the discretion of the licence-holder. The licence-holder should apply to the board, which should specify the hours which it thinks are suitable to the district. The amendment would allow the licence-holder to vary the two and a half hours from week to week and month to month. That is the weakness of the amendment.
    The Minister should consider the case of a large area in which there is a large proportion of nocturnal workers. The meat market, which is in my constituency, starts work at 6 a.m. and finishes at 2 p.m. The workers rush to the nearest pub and swallow as many drinks as possible before it closes at 2.30 p.m.
    Workers such as taxi drivers who are nocturnal workers have special organisa-
    518
    tions and clubs. The Press has clubs. Journalists are properly organised. Those who work nocturnal hours may use their clubs. However, the majority of nocturnal workers have no organisation. The amendment would allow a licence-holder to look at the situation in his area and choose the hours to suit it. The wording of the amendment is wrong as it would allow a licensee to change his hours from week to week and month to month.
    I think that the Government might look at the possibility of licence-holders, especially in areas where there are large numbers of nocturnal workers, registering their opening hours with the board.
    Mr. Harry Ewing: The amendment is concerned with the statutory afternoon break. I had the feeling that my hon. Friend was talking to the proposition that a licence-holder should have the ability to choose the hours in the day, within the number of hours laid down, when he should open. For instance, if he decided to open at 6 a.m., so be it as long as he did not exceed the 10½ hours' drinking time during the day. That is not the purpose of the amendment. Its purpose is to give flexibility to the two-and-a-half hour break so that the licence-holder, the publican, may decide when the two-and-a-half hour break should be taken during the day. There are serious defects in that.
    When it emerged from Committee, the Bill contained provision for a statutory afternoon break from 2.30 until 5 p.m. The Government do not accept the Clayson proposal that there should not be an afternoon break. Clayson recommended that the drinking hours should last from 11 a.m. until 11 p.m. We do not accept the concept of a flexible afternoon break, for the good reason that people would be able to move from pub to pub drinking continuously. It would be possible for different pubs to take different afternoon breaks, thereby providing a continuous period of drinking in an area from 11 a.m. until 11 p.m.
    We were not convinced by the arguments in Committee. I am sorry to tell the hon. Member for North Angus and Mearns (Mr. Buchanan-Smith) that we are not convinced this morning. I hope that he will withdraw his amendment.
    Mr. Tom McMillan: My hon. Friend is a little off the mark. The idea is that the licensing board considers the application by the licence-holder and makes a decision. A public house which is near a steelworks, for example, will attract steel workers, not citizens from other parts of the town.
    Mr. Ewing: Whatever Clayson was arguing, it was not for different licensing hours for different parts of Scotland. The Guest Committee, whose report was accepted by the Conservative Government in 1962, maintained the principle of uniform hours throughout Scotland, as did Clayson. There is no evidence to suggest that there is a demand for the degree of flexibility that my hon. Friend suggests. Neither committee argued that the hours should not be standard throughout Scotland.
    Mr. Tom McMillan: Although Clay-son argued that, the Government did not adopt it. In Covent Garden public houses are open from 6 a.m., but only people who work in Covent Garden are allowed to enter them. That is what I had in mind. The hours should be flexible to suit the people who are being catered for.
    Mr. Buchanan-Smith: I am sorry that the Minister is not prepared to accept the amendment. The hon. Member for Glasgow, Central (Mr. McMillan) put forward a valid argument which coincides with mine. In the Glasgow meat market, work usually finishes at about 2 o'clock in the afternoon and there is a rush to the public houses, which close at 2.30 p.m. We are seeking a greater degree of flexibility.
    Whether the hours are laid down from day to day or from month to month, flexibility is needed. I agree with the Minister that an afternoon break should not be seen as an excuse for a denial of drinking. That is not the purpose of the amendment.
    I know that the Minister is against the amendment, but I ask him, without commitment, to look again at this subject to see whether there can be a flexible system where there is a specific pattern, for example in a meat market. Overall control would rest with the licensing board. With a little ingenuity, safeguards could
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    be introduced. We have raised a point of substance which warrants further study.
    Mr. Harry Ewing: We shall have a look at it again, but I have pointed out all the difficulties and I promise to look at it without commitment.
    Mr. Buchanan-Smith: I beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    6.0 a.m.
    Mrs. Bain: I beg to move Amendment No. 109, in page 37, line 39, leave out 'five' and insert 'six'.
    In this amendment, my hon. Friend the Member for Dundee, East (Mr. Wilson) and I have recognised that a major problem exists in alcoholism. In recognising that it is a major problem, we have tried to put forward a partial solution. It is not perfect, but it is a partial solution. The Secretary of State drew attention earlier to the fact that he was concerned about the extension of licensing hours and the problems associated with that. We hope that he will support the amendment.
    We hope to offer a solution to the kind of situation in which so many working men in Scotland go straight to the public house after work for what is called "a quick pint with the boys" but often tend to stay from 5 o'clock until 10.30, and then go home finding they have spent their wages. We should like a situation in which men are encouraged to go home, particularly on Thursday and Friday, take home their wages, and see their wives and families and perhaps have a meal before going out for a drink with their friends in the evening. This would help family life and do much to attack alcoholism in Scotland. If the Government will not accept the amendment, we shall press it to a vote.
    Mr. Canavan: I am somewhat struck by the sheer cant and hypocrisy of the Scottish National Party in coming in like this. I wonder why this amendment was selected, because it is starred and was obviously tabled very late. I understand that there was considerable debate on this matter in Committee.
    Mr. Gordon Wilson: On a point of order, Mr. Deputy Speaker. I think that the hon. Member was attacking the fact

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    that the amendment has been selected. I think it is correct to say that it is in order, because these amendments were tabled within the appropriate time but were not printed on the Notice Paper.
    Mr. Canavan: I am grateful for the explanation by the hon. Member for Dundee, East (Mr. Wilson), but I advise him to get his amendments down earlier, as other hon. Members do.
    Members of the Scottish National Party, who spend much of their time upstairs in the bar, seem to be saying that although, because they work here, they can have drink literally unlimited from 11 o'clock in the morning until half an hour after the House adjourns, the ordinary working man or woman in Scotland cannot be trusted to go into a pub at 5 o'clock and have a responsible drink. Frankly, it is an insult to the working people of Scotland, and I hope that the Government will reject the amendment.
    Mr. Tom McMillan: I agree with my hon. Friend. There is a little of the Rip Van Winkle about this, because industry stops between five minutes to four and 4 o'clock. There has been a big change. People do not now clock off at 5 o'clock. They have time to go home and do things and then have a drink. The Scottish National Party is a little behind the times with this.
    Mr. Millan: I am not sure how the amendment got on to the Amendment Paper. I understand that it was put down in Committee but that for some extraordinary reason the hon. and kilted Member for Banff (Mr. Watt), who has joined our proceedings again, did not move it. It is a substantial amendment and it is better to consider such matters in Committee.
    The amendment proposes a considerable reduction in the permitted opening hours. Despite what the hon. Lady for Dunbartonshire, East (Mrs. Bain) said, I have no evidence—and there have been studies by the Office of Population Censuses and Surveys—of a relationship between drinking from 5 to 6 p.m. and heavy drinking. In fact, it seems to be mostly social drinking. It would be a considerable reduction in social convenience to prevent people having a drink on their way home from work.
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    It may be undesirable for social and other reasons for someone to go straight to a pub after work and to stay until closing time, but we must draw a balance between that situation and the fact that many people use pubs between 5 and 6 p.m. for the reasonable purpose of having a drink before going home. I do not think that we should deny them that facility.
    Mrs. Bain: The Secretary of State has missed the point of social responsibility in the context of the amendment. As a woman, I emphasise that our amendment reflects the view of many wives in Scotland who want their husbands to go home after work—whatever time they finish—before going to a public house. The temptation for men to stay in a public house, especially on pay day, is great. The Secretary of State should recognise these human weaknesses.
    The hon. Member for West Stirling-shire (Mr. Canavan) claimed earlier that he was concerned about the welfare of bar staff and attendants working in public houses. It would be to their advantage if the amendment were accepted, because they would be able to spend more time at home with their children.
    Mr. William Ross: I have a certain sympathy with the amendment, but it was not moved in Committee—which shows a certain amount of contempt for the Committee—even though it is now said to be so important. These facts do not add up.
    Mr. Harry Ewing: The Chairman asked the hon. Member for Banff (Mr. Watt) in Committee whether he wished to move Amendment No. 108. The hon. Member said "No". The hon. Member was then asked whether he wanted a separate vote on Amendment No. 108. He again replied "No". That is recorded at col. 517 of the Committee's proceedings of Tuesday 22nd June.
    Mr. Ross: That makes it all the more amazing that the hon Lady the Member for Dunbartonshire, East (Mrs. Bain) should come along and tell us how important the amendment is. The Scottish National Party should have seized its chance in Committee. I am surprised that in these circumstances the amendment has been selected. I know that the

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    Chair does not give reasons why amendments are selected or not selected, but the point made earlier about starred amendments is pertinent. Starred amendments are not usually selected and there must be a special reason in this instance, although I am not aware of one.
    The hon. Lady also talked about pay day, but what we are discussing does not occur only on pay day. It happens every day of the week. I have not the slightest doubt that the great majority of women in Scotland do not want to see pubs open on Sunday, yet the hon. Lady, who claims that she is concerned about the feelings of wives and women in Scotland, went into the Lobby in favour of pubs being open on Sunday. There is a certain element of hypocrisy in that.
    Mr. Canavan: On a point of order, Mt. Deputy Speaker. Earlier this evening the hon. Member for Glasgow, Cathcart (Mr. Taylor) was allowed to make two contributions during a debate with the leave of the House. May I please do so now. I shall confine my remarks to one paragraph.
    Mr. Deputy Speaker (Mr. Oscar Murton): I regret to say that the hon. Gentleman must have the leave of the House.
    Mr. Ross: I had given way to my hon. Friend the Member for West Stirlingshire (Mr. Concannon), Mr. Deputy Speaker. I had not finished my remarks.
    Mr. Canavan: I wanted to point out that the hon. Member for Dunbartonshire, East (Mrs. Bain) and I, when we were both employed as school teachers in Stirling, often used to adjourn at the end of term to an inn in Bannockburn along with her colleagues in the teaching profession at 5 o'clock. What she is trying to do is to make those meetings illegal. She is trying to make the unfortunate teachers wait until 6 o'clock in order to get a drink in a pub.
    Mr. Ross: I am grateful to my hon. Friend. That confirms what I thought, that there is an element of hypocrisy in this belated amendment. The Scottish National Party is trying to save its face because the majority of its Members voted in favour of Sunday opening.
    Mr. Gordon Wilson: I am surprised that the former Secretary of State for Scotland should adopt the attitude he has. This amendment has been put down in the names of myself and my hon. Friend the Member for Dunbartonshire, East (Mrs. Bain). We are perfectly entitled to put forward such amendments as we wish. Neither I nor my hon. Friend was a member of the Committee, and we are perfectly entitled to table the amendment. It has been selected, and the right hon. Member for Kilmarnock (Mr. Ross) expressed some vague sympathy with it. We considered that the amendment contained an important point, and my hon. Friend indicated that she was not satisfied with the answer which has been given by the Minister. Neither am I. In those circumstances, I cannot see how we can do other than press the amendment.
    Question put, That the amendment be made:—
    The House divided: Ayes 7, Noes 50.
    [For Division List No. 289 see col. 615.]
    Question accordingly negatived.
    Amendment made: No. 47. in page 37, line 43, at end insert
    but only in the case of premises in respect of which an application for Sunday opening has been made to and granted by a licensing board in accordance with the provisions of Schedule (Sunday opening of premises in respect of which a public house licence or refreshment licence is in force and Sunday restriction orders relating to licensed premises) to this Act, which shall have efiect.'.—[Mr. Millan.]
    Amendment proposed: No. 49, in page 38, line 14, at end insert—
    '(5) Notwithstanding the provisions above, the permitted hours under subsection (2) above shall only include Sundays in licensing board areas where the adult population express a desire to have Sunday opening.
    (6) To establish public opinion under subsection (5) above, each licensing board shall, on a day to be appointed by the Secretary of State, hold a referendum on Sunday opening and if a majority of those voting in the referendum vote for Sunday opening, the permitted hours shall be deemed to include Sundays.
    (7) If, not later than 30 days of a date to be specified by the Secretary of State each five years from the date of the referendum under subsection (6) above, 10 per cent. of the electors in a licensing board area request a further referendum, the licensing board shall hold a further poll'.—[Mr. Teddy Taylor.]
    Question put, That the amendment be made:—
    The House divided: Ayes 12, Noes 45.
    [For Division List No. 290 see col. 617.]
    Question accordingly negatived.

  Clause 55

    PROHIBITION OF SALE AND CONSUMPTION OF ALCOHOLIC LIQUOR EXCEPT DURING PERMITTED HOURS
    Mr. Harry Ewing: I beg to move Amendment No. 52, in page 38, line 29, leave out 'ten' and insert 'fifteen'.
    Mr. Deputy Speaker: With this we are to take Government Amendment No. 53.
    Mr. Ewing: The effect of the amendments will be to increase drinking-up time from 10 to 15 minutes. That will be a bonus when the hon. Lady the Member for Dunbartonshire, East (Mrs. Bain) goes back to work at St. Modan's School and my hon. Friend the Member for West Stirlingshire (Mr. Canavan) meets her when he is home in the parliamentary recess, when they can drink until 11.15 instead of 11.10 as under the original proposal.
    Mr. Teddy Taylor: We had a prolonged debate on Sunday opening, when one of the main arguments was that any additional time allowed for drinking would result in more drink being consumed and, therefore, in more alcoholism and more misery. We have already extended hours from 10 to 11 and here we have a small addition, five minutes. Does the Minister think that this small addition will result in more or less drink being consumed, or will the amount remain the same?
    Mr. Dempsey: I wish to ask—[HON. MEMBERS: "0h."] I have been sitting here since 11.15 and I am surely entitled in the House of Commons to ask a question. Will the local licensing board have discretion to extend the time of 11.15 by a further 10 minutes or quarter of an hour, as now?
    Mr. Harry Ewing: I think that this extension will neither increase nor decrease consumption; I think the result will be that exactly the same amount
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    will be consumed. I should tell my hon. Friend the Member for Coatbridge and Airdrie (Mr. Dempsey) that drinking-up time is clearly defined as being 15 minutes after closing time.
    Amendment agreed to.
    Amendment made: No. 53, in page 38, line 34, leave out 'ten' and insert 'fifteen'.—[Mr. Harry Ewing.]

  Clause 57

    ALTERNATIVE PERMITTED HOURS IN CERTAIN ATHLETIC CLUBS DURING WINTER
    Mr. Harry Ewing: I beg to move Amendment No. 54, in page 40, line 8, after 'evening', insert:
    'or alternatively be the said periods on weekdays other than Saturday, and on Saturday be the period between one in the afternoon and half-past ten in the evening'.
    This amendment meets a commitment that I made to the hon. Member for Dumfries (Mr. Monro) in Committee when the hon. Member kindly allowed me to take his proposition to find a suitable form of words for it.
    Mr. Monro: I should like to thank the hon. Gentleman for fulfilling his commitment to redraft my amendment to make it effective. I am sure that many sports clubs throughout the country will be deeply grateful to him for his consideration.
    Without trespassing too much on the hon. Gentleman's good will, I should like to say that I am still getting requests from one group of sportsmen—particularly appropriate on a day when we have won a gold medal in Canada. Those who sail are largely governed by the tide and therefore cannot fix their racing for the afternoon, perhaps because there is no water.
    Will the Minister consider whether in certain circumstances the closed period from 1st April to 1st September could be extended for certain sports such as sailing in which there are particular difficulties? I only ask him to think about this.
    Mr. Ewing: I am prepared to look at that proposition to see what might be done for those sailers with whom the hon. Member has a fellow feeling.
    Amendment agreed to.

  Clause 62

    SEASONAL LICENCES
    Mr. Russell Fairgrieve: I beg to move Amendment No. 58 in page 45, line 10, leave out '180' and insert '240'.
    I am one of the few hon. Members who have not spoken in tonight's debate. The reason for the amendment is that in the tourist trade areas of Scotland there are hotels which, because of the various sports for which they give facilities, have to remain open for a longer time than in the past. We want to increase the number of days for seasonal licences from 180 to 240. This applies particularly to places like those in my constituency—Braemar, Ballater, and Aboyne.
    Mr. Harry Ewing: As I recall, we discussed this matter at length in Committee. Clause 62 is a re-enactment, with modifications, of Section 10 of the Licensing (Scotland) Act 1962, which allows a licensing court, if an applicant so requests and the court considers that the requirement of the area make it desirable, to insert in a certificate a condition that the licensed premises shall not open for the supply of alcoholic liquor during specified parts of the year totalling not more than 180 days. The amendment would raise the limit to 240 days.
    This provision for seasonal licences originated in the First Report of the Guest Committee on Scottish Licensing Law and was designed to make it clear that licensed premises, mainly rural and tourist hotels, need not remain open all the year round as expected of them by some licensing courts. In the Highlands and Islands areas particularly, there was not enough business to justify licensed premises staying open all the year round. The limit of 180 days followed a Guest recommendation, with which Clayson did not quarrel, as a compromise between no limit on closure and a licensing court requirement of all-year-round opening.
    The whole clause is, like Clause 55 (5) on permitted hours, declaratory in nature rather than a substantive provision. Its effect is to enable a licence-holder who does not wish his premises to remain open all the year to obtain an appropriate condition from the licensing board to show that he has the board's approval
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    of his closure. Since the limit of 180 days has served its purpose for 14 years without difficulties arising, I hope that the amendment will be withdrawn.
    Mr. Fairgrieve: I beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.

  Clause 64

    OCCASIONAL AND REGULAR EXTENSIONS OF PERMITTED HOURS
    6.45 a.m.
    Mr. Canavan: I beg to move Amendment No. 60, in page 46, line 45, at end insert
    'or a private function organised by an individual member or group of members of the club'.
    I wish to declare an interest in that I am a member of the Bannockburn Miners' Welfare Club, the only club mentioned in my entry in Who's Who. The amendment is designed to remove an anomaly in order to allow late functions to be held in private clubs as long as the functions are organised by an individual member or group of members of a club. It arose from a meeting that my hon. Friend the Under-Secretary and I attended at the Bannockburn Miners' Welfare Club with representatives from that club and other clubs in Stirlingshire. The suggestion was put forward then and it was explained that there was a fault in this respect in the existing legislation and an omission in the Bill.
    I can illustrate the case for the amendment with an example. Suppose that a member of a club had a daughter who was to be married and he decided to hold the wedding reception in the club. Suppose that he wanted a late licence so that the reception could continue until midnight. Under the existing legislation and under the Bill, the club would not be able to provide the late licence. It would have to bring in an external licensee to provide the bar facilities. From past experience and from what I gather from those who manage clubs, this causes considerable organisational and travel difficulties, and in many cases it leads to a poorer-quality service since often only canned or bottled beer, which is more expensive, is available, a situation which is made worse by the fact that draught beer may be available more

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    cheaply but for the prohibition on the use of the club facilities.
    This is a reasonable proposal. The club secretary would still have to apply for the late licence and the concession would be confined to a club member or group of members. Also, the other guests attending the function would have to be signed into the club as guests in the usual way.
    Mr. Harry Ewing: I have had a good, close look at the proposition, but I am bound in all honesty to say regretfully that I cannot accept it as put. We have done a great deal in the Bill for licensed clubs. We have provided that when a club holds a function related to its activities in premises other than the club—in other words, if it takes its annual dance to the town hall—it can take its licence with it. Under existing law, it would have to get an outside licensee to provide the bar facilities in those premises. We have therefore adhered to the principle established through the years that functions held in the club must be related to the club's activities before the club is allowed an extension.
    We have examined all the possibilities In this regard and we have come to the conclusion that it would be better if, having extended the provision for clubs to take their licence with them when they hold club-related activities outside the club premises, we adhered to the principle in respect of functions inside the club premises as well. Extensions can be granted, but only on the basis of functions relating to a club's activities. To accept the amendment would extend the provisions in an unacceptable way. Therefore, regretfully, I have to resist the amendment.
    Mr. Canavan: I am grateful to my hon. Friend for his explanation but I am afraid that I find it unsatisfactory. It seems strange that under the Bill we shall give a club permission to take its licence to external premises and yet we shall not give permission to a member of a club, or a group of individual members, to hold a social activity such as a wedding or a funeral reception after the half-past two closing time. It appears rather strange that we should be discriminating in this way against ordinary members of clubs. I shall press to a Division what
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    I consider to be a reasonable amendment.
    Mr. Tom McMillan: I support my hon. Friend the Member for West Stirlingshire (Mr. Canavan). He makes a reasonable request. My daughter's engagement party took place in my club, as did my son's engagement party. The constitution of the club provided that it was shut on Mondays but that it could be opened on certain occasions. My hon. Friend makes a most reasonable request and I think that the House should adopt it.
    Sir John Gilmour: If a club can take a licence out to other premises, presumably it is possible for at least 50 per cent. of the people attending such a function not to be club members but to be guests of members. It seems rather odd that the Minister cannot accede to this request.
    Mr. Harry Ewing: I make it abundantly clear that there is no question of discrimination. The principle which has been applied over the years is that functions must be related to the activities of the club. It would be impossible to relate a wedding to the activities of the club.
    Mr. Tom McMillan rose—
    Mr. Ewing: If my hon. Friend is about to suggest that the wedding is because of the activities of the club, I shall accept what he says.
    Mr. McCartney: In this building we have the kirk downstairs. There are various things that take place down there, such as weddings, when those involved are related to a Member of this place or another place. That has nothing to do with what goes on inside the Chamber or in another place. What difference is there in principle between that situation and the situation to which my hon. Friend the Member for West Stirlingshire (Mr. Canavan) has referred? Surely what my hon. Friend has requested is not unreasonable. It is a minimal proposal in relation to the totality of what is proposed for clubs under the Bill.
    Mr. Ewing: I see all the difference in the world between marrying someone and filling someone with drink.
    Mr. Lambie: That is dirty.
    Mr. Ewing: My hon. Friend should be careful about making that sort of comment from a sedentary position.
    Mr. Lambie: I said that it was dirty because we are back to the old statements by Ministers that they are anti-drink. All the efforts we have been making to try to liberalise the drink laws in the Bill are against the wishes of the Government. We are going over the battles that were fought in the first debate that took place on Sunday drinking. That is why I said it was dirty.
    Mr. Harry Ewing: I am prepared to have a look at it and to see whether something can be done about it, but even if at the end of the day we reject the amendment that does not mean that anyone holding a wedding will be unable to have drink at it. It is not a question of the Government being anti-drink. If the Government were anti-drink, the Bill would never have been introduced in the first place. If my hon. Friend the Member for West Stirlingshire (Mr. Canavan) cares to withdraw the amendment I shall have another look at it.
    Mr. Canavan rose—
    Mr. McCartney: Will my hon. Friend give way? I take a serious objection to the comment that was made by the Minister, and my hon. Friend the Member for Central Ayrshire (Mr. Lambie) also objects. The suggestion is that people who attend funerals, weddings and so on are essentially drunkards. My daughter was married only four weeks ago, and I take great objection to what has been said here.
    Mr. Harry Ewing: On a point of order, Mr. Deputy Speaker. If my hon. Friend is upset at what I said, I willingly and unreservedly withdraw my remarks.
    Mr. Canavan: I am very grateful to the Minister for saying that he will consider my amendment further, but from past experience of such assurances from Ministers—this is not meant personally against my hon. Friend in any way—I feel that the best method of getting the Government to consider the amendment in detail is to have it written into the Bill at this stage, so that those characters along the corridor in the other place who sometimes interfere with our Socialist legislation can do some tidying up.
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    In this instance, I seriously think that a lot of ordinary working people who are members of clubs, and who are concerned about late licences for occasions such as weddings, funerals, christenings and so on, would like to see this very reasonable amendment put into effect by a Labour Government. I therefore wish to press the amendment to a Division.
    Question put, That the amendment be made:—
    The House divided: Ayes 31, Noes 22.
    [For Division List No. 291 see col. 671.]
    Question accordingly agreed to.

  Clause 65

    RESTRICTION ORDERS
    Mr. Teddy Taylor: I beg to move Amendment No. 61, in page 47, line 31, after 'safety', insert
    'or that the licensed premises do not conform to a standard regarded as acceptable by the members of the board'.
    This is an important amendment which tests the sincerity of the Government and a large number of hon. Members who voted for Sunday opening and for the Bill.
    Throughout our discussions, the Minister expressed the hope that an improvement in the standard of licensed premises would result from the Bill. But there is nothing in the Bill to ensure that that improvement will occur. The Bill contains provisions which the Minister hopes will ensure an improvement, but there is nothing to ensure that Sunday opening and an extension of hours will improve the standard.
    The amendment is an attempt to secure a modest upgrading of the standard of licensed premises. Under Clause 65, the new hours of selling drink, up to 11 p.m. plus a quarter of an hour, can be reduced by a restriction order if the licensing board is persuaded that the premises constitute an undue public nuisance or a threat to public order or safety. One might think that if a public house provided a threat to public order or safety it would be modest to say that instead of selling until 11 p.m. it could sell only until 10 p.m.

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    If there is a threat to public order or safety, the board can consider a restriction order or, in other words, a fine, by the loss of one hour of drink sales time. I suggest going a bit further and I have proposed that, if members of a board are of the opinion that licensed premises do not conform to the standard they regard as acceptable, they can impose a restriction order which would mean 10 o'clock closing. This is a kind of two-tier system which can be operated by the members of the board.
    Hon. Members have disagreements about some matters, but we all want to see pub standards improved. This is a modest way in which it can be achieved. One may ask what difference an hour would make. I suggest that if people are faced with a choice of going to a pub which closes at 11 p.m. or to another which closes at 10 p.m. they will be likely to go to the one which closes at 11 o'clock. It is a form of discipline which should be applied by the boards to improve standards.
    This is not a novel suggestion or new departure. The Government already say that they will apply discipline, but only in cases where the house constitutes a nuisance or provides a threat to public safety and order. I propose to extend the restriction orders to saying "This pub is not up to standard."
    I see that there will be some arguments against this proposal. People will ask "Is it fair if the board in Ross and Cromarty applies different standards to those applied in Glasgow?" The boards are the democratic representatives of their areas and should impose their own standards. I am not laying down rigid criteria or saying how large should be the drinking space or that the pub should provide meals or seats or display a sign saying "No women admitted" but am leaving it entirely to the boards to say what they regard as an acceptable standard.
    This will give considerable power to the boards, but that is there already because they can say what is a threat to public order. Something which constitutes a threat in Roxburgh, Selkirk and Peebles would be different from what constituted such a threat in Glasgow. It will be up to the boards to fix their
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    own standards of public nuisance or safety.
    There is, therefore, no change in principle. We can give more scope within the principle. I am suggesting that we should extend it. The people of Scotland will be concerned that we are taking this step of licensing reform without a specific measure to improve public standards. This proposal would achieve that.
    I hope that, having made a major reform in Scottish licensing, the House will accept this minor amendment to say that we shall apply this discipline. But what kind of discipline is it? Would it work? I believe that it would. If the board decides that a pub must close at 10 p.m., its income and reputation will be substantially affected. The pub will get a bad name.
    7.15 a.m.
    The Minister may say that the drafting of the amendment is not perfect, but he should not let that stop him from accepting the principle. The Government may also argue that they are trying to improve standards in the schedule which is to be considered later, but that provides that these disciplines shall be applied only if there is undue public nuisance or disturbance. That is not the same as improving standards. My amendment would be a useful step forward. I am not suggesting that pubs should be closed if they are not up to standard. If they improve, they should be allowed to return to 11 p.m. opening. This is within the spirit of the speeches of almost every hon. Member, whether for or against longer hours or Sunday opening. We all want to see standards improved.
    Mr. Millan: Clause 65 is concerned only with restriction orders, and the restriction of opening hours is very much related to public nuisance and public disturbance. We want greater sanctions than a 10 p.m. closing time for premises that do not come up to standard and we have them in Clause 34, which provides the power to close premises which are not of an acceptable standard.
    Far from not meeting the point of the hon. Member for Glasgow, Cathcart (Mr. Taylor), the Bill goes well beyond the sanction that he seeks. His amendment would weaken the powers of the Bill to deal with premises which are not of a suitable standard. We have much

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    stronger sanctions, and I hope that appropriate cases they will be used.
    Mr. Teddy Taylor: I cannot accept what the Secretary of State has said. If premises are to be closed because standards are not acceptable, should they not also be closed if there is undue public nuisance or disturbance?
    Clause 34 says:
    "Where a licensing board considers that licensed premises are no longer suitable or convenient for the sale of alcoholic liquor, having regard to their character and condition, and the nature and extent of the use of the premises, the board may decide to hold a hearing with a view to making a closure order under this section".
    The Minister will be aware that when the words "no longer" are used they must relate to a deterioration. There is certainly plenty of case law in this respect. If that is not the case, why are the words "no longer" contained in Clause 34? The Minister will be aware that this is a sanction which will be applied if there is a deterioration in the construction of the building or because of a change in circumstance. Clause 34 applies, like the rating laws, to a change in circumstance. If the amendment is accepted, it will not in any way affect Clause 34. It will not weaken Clause 34, but it would be an alternative sanction for different circumstances. If I am wrong, why are the words "no longer" included in Clause 34?
    I want to give the licensing boards the power to improve the standard of pubs. Clause 34 is a violent section. I am not concerned with closing pubs down. I would suggest that most people, whether they live in Ross and Cromarty, Stornaway, Glasgow or anywhere else, would prefer a less rigid sanction than simply closing the pubs down.
    For example, if a licensing board said that it was happy with eight pubs in its area but not the ninth, does the Minister say that we should close pub No. 9? That is not the answer. We should try to impose some form of discipline which will encourage pub No. 9 to improve its standards. The limited legal advice which I have received informs me that Clause 34 applies to pubs which have deteriorated or have changed circumstances. That is why the words "no longer" have been inserted. But if we want to make
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    provision for the improvement of standards in pubs, should we not have something along the lines suggested in the amendment?
    I think that the Secretary of State is being a little unreasonable. He must accept that, even if we have the power that I am suggesting in Clause 65, the provisions contained in Clause 34 will remain undiluted. The amendment simply provides an additional power gradually to bring about an improvement in standards. I hope that the right hon. Gentleman will reconsider this point.
    Whenever I have said anything, all I have got is a surly look from the Secretary of State. Although he and I may disagree about many things, I hope he can accept that one of the aims of the Bill is to improve public house standards. It would do no harm to accept the amendment, and it might do a lot of good. Irrespective of what the Secretary of State has said, I hope the House will accept that the amendment would be a useful one.
    Mr. Millan: The hon. Member for Glasgow, Cathcart (Mr. Taylor) has changed his mind. At the beginning he complained that the Bill contained no provision to deal with the standard of premises. I said that such a provision was contained in Clause 34, and that it was a much tougher sanction than the one he is proposing, unnecessarily I think, to write into Clause 65. The hon. Gentleman now says that he wants to write it into Clause 65 as an additional sanction as if he was aware of Clause 34 all the time, which obviously he was not.
    I do not know why the hon. Gentleman cannot occasionally get up and say he is sorry and that he has overlooked Clause 34. He gets up and goes on at great length as if he had known about it all the time, and now he wants to do something which is entirely different from what he originally said. Closures on grounds of public safety are dealt with in Clause 33. There is, therefore, no gap in the Bill from that point of view.
    There is no significance in the use of the phrase "no longer" except that a licence should not be given in the first place unless the premises are of a satisfactory standard. It follows logically that they cannot be closed unless they are no

    537
    longer of a satisfactory standard. There is no sinister significance in the phrase. The amendment would weaken the sanctions in the Bill, which the hon. Member originally said that he favoured.
    Mr. William Ross: I can appreciate the extent of the concern of the hon. Member for Glasgow, Cathcart (Mr. Taylor), but I wonder whether he read Clause 65 before he tabled the amendment. This provision relates only to the sale or supply of alcoholic liquor in the evening, when there could be undue public nuisance which could constitute a threat to public order or safety. Now, however, the hon. Member seeks to shift the ground to licensed premises which do not conform to a standard acceptable to members of the board. That does not relate to the evening. That surely relates to the premises themselves, which, as my right hon. Friend the Secretary of State said, are adequately covered in the previous clauses. I appreciate what the hon. Member is seeking to do, but the amendment would not be desirable, effective or practical.
    Mr. Teddy Taylor: I respect the views of the right hon. Member for Kilmarnock (Mr. Ross). I am sorry that the House appears to have no sympathy with what I am trying to do. Not one voice other than my own has been raised in support of the amendment. If the right hon. Gentleman takes that view, that is good enough for me. I beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.

  Clause 66

    TEMPORARY RESTRICTION OF PERMITTED HOURS
    Mr. Buchanan-Smith: I beg to move Amendment No. 63, in page 48, line 35, after 'safety', insert
    'and after consultation with representatives of the licensed premises in the area'.
    The amendment would impose certain minor restrictions which would improve the clause. It would provide for consultation with owners of licensed premises in the area concerning the exemption of international airports. This would be helpful, because the privileges which these airports enjoy can affect other licensed premises in the area.
    7.30 a.m.
    Mr. Harry Ewing: Clause 66 gives effect to a Clayson recommendation and empowers a licensing board, on an application from a constable of the rank of chief inspector or above, to order a temporary restriction of permitted hours of up to three hours on a specified day if it considers it desirable in the interests of public order or safety. Circumstances in which this power might be used are, for example, those associated with a football match on a Saturday afternoon or an evening.
    It is undeniable that a lot of public disorder is associated with football matches and, to a lesser extent, with some forms of demonstration or public meeting. Many licence-holders recognise this and voluntarily close their premises for the short period involved. Because some licence-holders act voluntarily, it is clearly desirable for a licensing board to consult representatives of the trade before making a temporary restriction order as the amendment proposes. There would be no point in the board making an order if it knew that the premises involved were to be closed anyway at the appropriate time on the initiative of the licensee. The true value of the power lies in the speed with which it could be used, and, if it were obligatory for a board to consult representatives of the licensed premises in the area before making an order, there is a risk that that advantage would be lost.
    I have gone into that detailed explanation because I am sure that the hon. Member for North Angus and Mearns (Mr. Buchanan-Smith) will want to read it carefully when it appears in Hansard.
    Amendment negatived.
    Mr. Buchanan-Smith: I beg to move Amendment No. 64, in page 49, line 1, leave out subsection (3) and insert:
    '(3) Where practicable, the constable making an application under subsection (1) above shall notify the licence holder of premises to which the application refers and the licence holder of those premises may make representation to the Board'.
    In Committee we debated the question of a temporary restriction being applied for by a police officer. We expressed concern that the licence-holder would not necessarily have knowledge that the application was being made and would

    539
    not be given the opportunity of making representations to the board.
    I have had another look at this matter to see whether we could come back with an amendment which would meet the situation where it might be difficult for the police officer to notify the licence-holder but where practicable he should do so. I have qualified the new subsection which I am seeking to have inserted into the Bill by including the words "where practicable". Therefore, the licence-holder is being given not an absolute right but some protection. Otherwise, things could happen in a hurry without his knowing and being given an opportunity to put his view to the board.
    I hope that the Minister will accept the amendment. I am sure he appreciates that I have tried to put it forward in a way which will not destroy the main purpose of principle of the clause.
    Mr. Harry Ewing: The remarks that I made on Amendment No. 63 relate to this amendment as well in the sense that the speed with which the action could be taken is all-important to the purpose that it serves.
    Clayson did not consider that licensees should have the right to object to the making of an order closing their premises for the purposes of law and order and related matters since closure would be for a limited period. I see no reason to disagree with the view of the Clayson Committee on the question of a right of objection.
    There are already safeguards in the clause. An application would be made only by a senior police officer. I am confident that applications would be made only where the police were satisfied that there was a strong case. The board then has to consider whether it is satisfied that there is a strong case and whether it is desirable, in the interests of public order or safety, to make an order.
    Since closure would be for a period of no more than three hours on a specified day, I do not think that the normal arguments about providing an opportunity for objections apply. As I said on the previous amendment, the board would probably have to act quickly in the circumstances envisaged by the clause. I hope, therefore, that the hon. Member
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    for North Angus and Mearns (Mr. Buchanan-Smith) will agree to withdraw the amendment.
    Mr. Buchanan-Smith: I am grateful for that explanation. I was not seeking to destroy the principle of the clause. In view of the Minister's assurance, I beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.

  Clause 67

    PENALTIES FOR OFFENCES AGAINST PROVISIONS OF THIS ACT
    Mr. Millan: I beg to move Amendment No. 65, in page 50, line 3, at end insert—
    '( ) Where a licence-holder is convicted of an offence under the Prevention of Corruption Acts 1889 to 1916 in connection with an application to a licensing board under this Act, the court by which he is convicted may, in addition to any other penalty which the court may impose, make an order in accordance with either or both of the following paragraphs, that is to say—

    (a) that the licence-holder shall be disqualified from holding a licence for a period not exceeding five years in respect of the premises to which the application relates or related;

    (b) that the premises to which the application relates or related shall be disqualified from being used as licensed premises for a period not exceeding five years.'.

    The amendment is self-explanatory. It would enable the court which convicts a licence holder of corruption in connection with the granting of a licence to disqualify that person from holding a licence, and the premises from being licensed, for a period of five years.
    Amendment agreed to.

  Clause 68

    PROTECTION OF YOUNG PERSONS
    Mr. Teddy Taylor: I beg to move Amendment No. 66, in page 50, line 28, at end insert—
    '(2A) A person under 18 shall not be in possession of or consume alcoholic liquor in any public place'.
    This amendment is important. The Minister will recall that no hon. Members spoke in Committee against my proposition, which was that it should be unlawful for any person under the age of 18 to be in possession of or to consume alcoholic liquor in a public place.

    541
    The clause provides that a licence holder
    "shall not in licensed premises sell alcoholic liquor to a person under 18, or allow a person under 18 to consume alcoholic liquor in a bar, nor shall the holder of the licence allow any person to sell alcholic liquor to a person under 18."
    There is also the provision that
    "A person under 18 shall not in licensed premises buy or attempt to buy alcoholic liquor nor consume alcoholic liquor in a bar."
    Although licence holders are not allowed to sell drink to people under 18 and under-18s are not allowed to consume alcohol on licensed premises, underage drinking is a serious problem in Scotland—and there are indications that it is becoming worse. Often a youngster aged 19 will buy a substantial quantity of drink from an off-licence shop for his many friends who may be as young as 14. They will go to a public place—in Glasgow it is usually a park—and they will hold a drunken party. The police will see a crowd of youngsters with drink in their possession but they can do nothing. The Secretary of State may say that they can do something. If so, he should correct me.
    My friends in the police are anxious because they are totally powerless to act if they see a crowd of youngsters with drink in their possession. Anyone who lives in an area with parks knows that this is a desperately serious problem. Any morning when walking in a park with their kids people can see large numbers of beer cans and bottles scattered about the place.
    The Scottish Police Federation has suggested making it unlawful for young persons under the age of 18 to be in possession of drink in a public place. In Committee, the Minister was always sympathetic and reasonable and he said that he would examine the suggestion. He said:
    At present, we are in discussion with the Association of Chief Police Officers in Scotland about the implications of the creation of a new office along the lines suggested by the hon. Member for Cathcart. I ask for the cooperation of the Committee, as I have had throughout the Bill, on this matter also, in that the matter is not pressed while our discussions with the association proceed. I will advise the hon. Member for Cathcart about the outcome of the discussions and about the Government's intention on Report, and I give him and the Committee the assurance that, if
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    it is possible to put down an amendment on Report that will meet his point, we shall either offer that amendment to him or put it down ourselves.—[Official Report, First Scottish Standing Committee, 22nd June 1976; c. 625.]
    I received a letter from the Minister, dated 22nd July, saying:
    "I informed the Committee during the debate on your amendment to create a new offence that we had consulted the Association of Chief Police Officers. In the light of our consultations and further consideration of the matter we have decided against putting down an amendment. Since your own amendment is on the Order Paper again we shall have an opportunity to debate this further point on Report."
    The Minister did not say that it could not he done. In view of the clear assurance given in Committee, is he now saying that it is not possible to nut down an amendment to meet the point or that he has thought about it and decided not to do so? If he does not want to do so, I wonder why.
    I can think of the possible problems. For example, the hon. Member for West Stirlingshire (Mr. Canavan) might want to send one of his children round with a bottle of brandy to his old granny, who might need it for medicinal reasons. It might be said that it would be an outrage if the youngster were apprehended by the police and locked up. That presumably could happen under a strict interpretation of the law, but a sensible fiscal would see that it did not. A charge probably would not be proceeded with. But something could be done about a group of rowdy youngsters having a drunken party in a public park or on their way to such a party.
    If the Minister is serious about wanting to do something about the problem of teenage drinking, we must have a provision along the lines I suggest. The police need stronger powers. I very much doubt whether they would take action in the circumstances I have described if they had an explanation from the youngster or his parents.
    I am glad to see the return to the Chamber of the hon. Member for Glasgow, Central (Mr. McMillan), because I had his full support on this matter in Committee, where he said:
    "The point made by my hon. Friend of the little boy going round with a bottle to his granny does not exist in my mind. What is in my mind is what is happening in Glasgow today—the consumption by under-18s in closes, parks and other places from where

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    the rampage starts. It is the consumption of that drink by under-18s, it having been bought and supplied by over-18s, that concerns me."—[Official Report, First Scottish Standing Committee, 22nd June 1976; c. 625.]
    The hon. Gentleman was absolutely right in saying that it was a serious problem.
    Mr. Tom McMillan: I think that I added that it would be better dealt with as a new offence.
    Mr. Taylor: Yes, indeed, and it is a new offence that is the purpose of my amendment.
    7.45 a.m.
    My amendment provides for a new offence, and I hope that I shall have continued support for that proposal. The amendment suggests that
    "a person under 18 shall not be in possession of or consume alcoholic liquor in any public place".
    That would make it an offence. We are dealing with Part VI of the Bill, which is headed "Offences", and Clause 68 is headed "Protection of young persons".
    I represent a large housing scheme, as do many other hon. Members. When youngsters have taken drink, they go on rampages, breaking windows and making life intolerable for the majority of law-abiding decent citizens. We have to do something to protect youngsters from drink and also to protect the community from the consequences of youngsters consuming drink.
    Has the Minister any other proposal? Will he try to deal with this problem through the social services, knowing that expenditure on the social services has been cut? Will he try to deal with it through the schools, knowing that expenditure on the schools has been cut?
    We have to help to deal with what has become an urgent and serious problem for Scotland. We have the support of the Police Federation. I hope that the House will support the amendment.
    Mr. Harry Ewing: As the hon. Member for Glasgow, Cathcart (Mr. Taylor) has said, he suggested this amendment in Committee, and it is equally true that he kindly agreed to withdraw it in order that I could continue the discussions that I was then having with the Association of Police Officers. The problem is not that of creating a new offence but of enforce
    544
    ment once that new offence has been created. It is because of the problems of enforcement and the wider consideration of the police powers of stop and search, going way beyond possession of alcohol, that I decided not to table an amendment, as the hon. Member for Cathcart fairly said, and I advised him in writing of my decision.
    I discussed the matter with the Association of Police Officers and with Her Majesty's Inspectorate of Constabulary. It was pointed out to me that there was already legislation of this kind not for alcohol but for tobacco. It is an offence for a youngster under 18 to be in possession of tobacco, but the police have found it impossible to enforce that and they strongly believe that to create a new offence along the lines on which, frankly, we were thinking would result in another provision that could not be enforced.
    The hon. Member for Cathcart is stretching words a little when he says that his proposal has the support of the Police Federation. I am sure that he would be the first to admit that he is drawing on the booklet sent out by the Polic Federation in which there is a specific mention of the need for a new offence to be created against that background.
    Mr. Teddy Taylor: Will the hon. Gentleman read the extract?
    Mr. Ewing: It is subject to interpretation and mine is that no policeman is anxious to create a new offence that cannot be enforced. That is the difficulty with this type of offence. I have discused the matter with the Association of Police Officers and the inspectorate and the advice we have been given is that enforcement is impossible.
    It is not only a problem of youngsters drinking cheap wine in closes and so on. We also have youngsters who go on a picnic, for instance, with their parents, who may give them an occasional glass of wine. It is all very well to say that in those circumstances the police would not proceed with a charge if they were satisfied with the explanation, but that is a matter for speculation and creates sufficient doubt to convince me that I ought not to suggest an amendment and that I ought to resist the hon. Member's amendment.
    Having said that, I wish to say that I have a great deal of sympathy with

    545
    what the hon. Member has said about the problem of under-age drinking. There are no easy answers. If there were, previous Governments would have found them. I give the assurance that we shall go on looking for an answer and I hope that when we find it, we shall be able to deal with the problem and enforce the solution.
    Regretfully, I have to say that the solution proposed in the amendment is not the answer to this problem and that it cannot be enforced. For those reasons I hope that the hon. Member will agree to withdraw the amendment.
    Mr. Teddy Taylor: I cannot agree with the Minister at all. He has put forward a number of arguments, one of which is the claim that this could not be enforced. Is he saying that we should not have this law because it would not be possible to stop all youngsters under 18 who are carrying drink in a public place?
    The law says that we shall not drive at more than 30 mph in a built-up area. Many people drive over that limit all the time and the police do not stop them all. There are simply not enough police to do this. Nevertheless, it is a good thing to have that law because from time to time the police catch someone who is speeding and take him to court.
    The same applies to youngsters who are in possession of drink in public places. From time to time the police will see a crowd of bad youngsters and they will have the powers to stop them. Is the Minister arguing that we should not have an offence unless all the offenders can be caught? It has never been suggested that we cannot pass a law unless we can apply it to everyone.
    In some areas of Scotland youngsters with drink are becoming a major public nuisance and the police have no powers to do anything about it. I challenge the Minister to tell me what the police in Glasgow, for example, can do if they see 10 youngsters, aged about 15, walking towards a park, in possession of five bottles of whisky, three bottles of gin and 20 cans of beer. Have they any powers to anything at all? If they do have the powers to confiscate the drink, then obviously we do not need this amendment, but my understanding is that they have no powers at all.
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    The Minister said that I interpreted the Police Federation pamphlet rather widely. Unfortunately I do not have my copy with me. But it is a bit thick for the Minister to say that my interpretation is incorrect unless he can produce a copy of the pamphlet and tell me to what extent I am wrong. All I can say is that my reacting of the pamphlet is that the Police Federation is in favour of the police having powers to stop youngsters from carrying drink in public places. I have also spoken to a large number of policemen, and they would like these powers.
    The Minister must not underestimate the extent to which the police are fed up with their lack of powers for dealing with these youngsters. I do not want to start an acrimonious discussion on this matter, but the Minister should realise that the police are getting fed up to the teeth. My amendment would give them the power to confiscate the liquor and to have fined the youngsters who cause a public nuisance of this kind.
    The Minister must not underestimate the effect on vandalism. Youngsters get drunk and then go on the rampage, threatening the lives and property of decent people. The Minister says that he can do nothing about it but that he will keep on looking for solutions in case one can be found. But if he accepts the amendment, what harm can it do? Does it bring the law into disrepute because it can he applied to everyone but someone might drink in a public place and get away with it? If that is the case, the 30 m.p.h. limit is an affront to the law. I am not convinced by what the Minister said and I hope that the House will accept the amendment.
    Would it cause a great deal of inconvenience? Would it cause any offence to anyone? The Minister asked what would happen to the family in the park where the father offers his youngster a glass of wine. How stupid does the Minister think the police are? Is he saying that the police will go on raiding parties looking for fathers giving glasses of wine to their children? The police want this power so that they can apprehend the rowdies and young thugs who, after a drink, become young savages. They want to be able to confiscate their drink.

    547
    If the Minister's only argument is that the police will hide behind bushes in parks and watch for fathers giving a glass of wine to their children, that is a very poor argument. He did not say very much about the discussions with the chief police officers. He said that they thought that there was no case for making the change. But did they say that they would be angry if it were done? The amendment is a good amendment which will strengthen the police and play a small part in removing a very serious nuisance in areas such as the city of Glasgow.
    Mr. Tom McMillan: I find myself in the same dreadful position as in Committee in that I agree with the hon. Member for Glasgow, Cathcart (Mr. Taylor). He has highlighted one of the greatest problems among young people, particularly in Glasgow. I have declared before that my wife has an interest in a shop with an off-licence section and I have known of happenings there for some three years. Youngsters under 21 are not served and they set out to get their own back. The local policeman, who knows them and knows their ages, stops them outside the shop where they claim to have purchased drink for themselves. The shop proprietor says that he did not serve the youth, but to get his own back for being refused drink the youth insists that he did. In that way shopkeepers can become the victims of youngsters whom they have refused to serve.
    This is particularly a problem in Garthamlock, Ruchazie and Craigend where youngsters get drunk and attack policemen. They run rampage in the place, smashing windows and vandalising. Yet it is not an offence for them to carry the drink that causes all the trouble.
    I entirely agree with the hon. Member for Glasgow, Cathcart that something must be done about this problem. It is a growing problem, not something that is static. If we do not act now, we shall be in a desperate situation.
    8.0 a.m.
    Mr. Harry Ewing: The hon. Member for Glasgow, Cathcart (Mr. Taylor) must not go on saying that the police want this offence. I have advised the House that the police, through the chief constables and the inspectorate, have told us
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    that they do not want the offence. That is why there is no amendment in the name of my right hon. Friend to provide this offence.
    We have discussed this matter with the Association of Chief Police Officers. Like the hon. Gentleman and all hon. Members, it recognises the problem of under-age drinking. However, the hon. Gentleman did not apply his mind to the problem that the police have in enforcing the existing law. That was the strongest evidence that was laid before us—namely, that the police could not enforce existing legislation. The chief constables and the inspectorate considered that they could not meet the sort of legislation that is now proposed. There were discussions and advice was given. That is why the Government decided to proceed in the manner that I have outlined.
    Mr. Teddy Taylor: We discussed this matter in Committee, and I made it clear that in my view the Scottish Police Federation, which represents all the serving officers in Scotland not of the rank of inspector, had taken the view that it wanted this offence. The Minister said that in his view there was some doubt about the pamphlet that was produced. I have had correspondence with the Scottish Police Federation and it has told me that it was pleased with what I was doing in raising the matter. My view is that the federation wants the amendment.
    The Minister has said that he is taking this issue seriously. Did he take the trouble to ask the federation what its views were? He said that he was in touch with the chief constables, but in view of the discussions in Committee, has he consulted the federation that represents all the police in Scotland except for the chief constables and the boys at headquarters? I think it is fair to describe it as representing all representative policemen. Did he ask the federation for its views?
    Question put, That the amendment be made:—
    The House divided: Ayes 9, Noes 35.
    [For Division List No. 292 see col. 619.]
    Question accordingly negatived.
    Sir John Gilmour: I beg to move Amendment No. 67, in page 51, line 27, after 'person', insert 'knowingly'.

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    Good morning, Mr. Speaker. I trust that you had a pleasant night.
    Mr. Speaker: I realise that the Scots take drink seriously, but I did have a good night.
    Sir John Gilmour: That certainly adds to our pleasure.
    Long before we started discussions on this Bill I had talks with the licence holders in my constituency who are worried about the difficulties they experience in knowing whether people are of an age to be served with drink. The sort of publicity that has recently been given to lowering the age of consent in other matters shows what difficulty a licence holder has in assessing the age of persons who come into his premises.
    It may well be that the provisions of Clause 71, which refer to Clauses 68(1), 68(5), 69(1) and 70, give the licence holder adequate protection. If that is so I should be glad to have the confirmation of the Secretary of State to that effect.
    8.15 a.m.
    Mr. Millan: The hon. Member for Fife, East (Sir J. Gilmour) in moving the amendment identified the assurances that are already in the Bill. I confirm that the points he mentioned are dealt with and that the amendment is unnecessary.
    Sir John Gilmour: I beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.

  Clause 80

    PENALTY FOR PERMITTING THIEVES, PROSTITUTES OR STOLEN GOODS IN LICENSED PREMISES
    Mr. Harry Ewing: I beg to move Amendment No. 68, in page 55, line 18, after 'prostitutes', insert:
    'or persons convicted of an offence under section 4 or 5(3) of the Misuse of Drugs Act 1971'.
    The amendment adds drug traffickers to the list of undesirable persons whom it is an offence for a licence holder knowingly to allow in his premises. It honours an undertaking given to the hon. Member for Fife, East (Sir J. Gilmour) in Committee.
    Amendment agreed to.
    Amendment made: No. 69, in page 55, line 20, after second 'prostitutes', insert:
    'or persons convicted of an offence under section 4 or 5(3) of the Misuse of Drugs Act 1971'.—[Mr. Harry Ewing.]

  Clause 83

    DRINKING IN PLACES OF PUBLIC REFRESHMENT, ETC., WHEN PUBLIC HOUSE IS CLOSED
    Amendment made: No. 70, in page 55, line 41, at end insert:
    'and any person who so consumes alcoholic liquor shall be guilty of an offence'.—[Mr. Harry Ewing.]

  Clause 91

    DELIVERY OF ALCOHOLIC LIQUOR BY VEHICLES, ETC
    Amendments made: No. 71, in page 58, line 18, leave out 'van, barrow, basket or other'.
    No. 72, in line 32, leave out 'van, barrow, basket or other'.
    No. 73, in line 41, leave out 'van, barrow, basket or other'.—[Mr. Harry Ewing.]

  Clause 97
    CONSUMPTION OF, TAKING AWAY OF, AND SELLING LIQUOR FROM, OFF-SALE PREMISES.
    Amendment made: No. 74, in page 61, line 24, leave out 'caravan, tent. shed'.—[Mr. Harry Ewing.]
  Clause 101

    RESTRICTION ON SALE OR SUPPLY OF LIQUOR IN PREMISES SUBJECT TO ENTERTAINMENT LICENCE.
    Mr. Rifkind: I beg to move Amendment No. 75, in page 62, line 37, at end insert
    'save only that nothing in this Act shall prohibit the offering of alcoholic liquor as a prize in premises with an entertainment licence where prize bingo is operated under the provisions of the Gaming Act 1968'.
    A similar amendment was considered in Committee and the Minister advised the Committee to reject it on the ground that if it were accepted it would result in enormous gains being obtained by bingo winners at such establishments. He cited terrifying examples of persons who, having won large sums of money in the

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    form of vouchers, exchanged them for huge supplies of alcoholic liquor and left the premises in an undesirable fashion.
    Since that debate, the Minister has received a letter—a copy of which has been sent to me—from the British Bingo Association, in which it is pointed out that the Minister—unwittingly no doubt—misled the Committee. The association states, first, that where prize bingo is being played the prizes have a value varying from 40p to 100p—not the high value suggested by the Minister. Secondly, under the Gaming Act 1968, the prizes are limited per person to 10p and the aggregate amount that can be taken way by the sale of chances in any one determination of winners is limited to a total of £5. The maximum value is, therefore, exceedingly small. Thirdly, the maximum number of participants is usually 50 and the game is played upon special fixed positions in a small area of the club. The game is, therefore, of a much more limited nature than the Minister suggested in his alarming speech in Committee, and I hope that he will reconsider the answer he gave.
    Vouchers of relatively small value are exchanged for miniature bottles of alcoholic liquor. The problems suggested by the Minister do not arise, and on that basis I hope that he will reconsider what he said in Committee and, if he is not able to accept the amendment, at least give an assurance that the Government will consider the matter and determine speedily whether an amendment might be appropriately put forward.
    Mr. Harry Ewing: It is true, as the hon. Member for Edinburgh, Pentlands (Mr. Rifkind) said, that in our debate in Committee, because of the rather sheltered life I lead, I was not clear about the difference between prize bingo and bingo, but I am bound to point out that the hon. Member, advised by the association and bingo caller to the Committee, was not able to keep me right. It is pleasant to hear him read out with great confidence the letter we have obviously both been sent. On the basis of the information received it would be proper for me to have another look at this.
    Mr. Rifkind: On that basis, I am prepared to withdraw the amendment. I
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    beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.

  Clause 114

    POWER OF POLICE TO ENTER CLUBS
    Mr. Canavan: I beg to move Amendment No. 77, in page 72, line 36, after 'may', insert
    'after obtaining the permission of the club secretary or a person authorised to act on his behalf,'.
    Mr. Speaker: With this it may be convenient to take the following amendments:
    No. 78, in page 72, line 37, after 'club' insert
    'without a warrant but only if he has reason to believe that the time that would elapse before such warrant could be obtained would prevent the enforcement of the provisions of this Act in said club'.
    No. 80, in line 38, after 'constable' insert 'with such permission'.
    Mr. Canavan: Amendment No. 77 and the consequential Amendment No. 80 have as their object restricting the right of the police to enter a club. The amendments are basically to preserve the status quo.
    I have a constituency interest in this matter as I have many clubs in West Stirlingshire—miners' welfare clubs at Bannockburn, Plean, Fallin, Cowie and Kilsyth; the British Legion Club at Kilsyth and masonic clubs at Bannockburn, Denny, Kilsyth and Bridge of Allan; Kilsyth Rangers Club and Kilsyth Celtic Club; Cambusbarron and Bonnybridge social clubs; and works clubs such as the "Cork and Seal" at Bridge of Allan.
    That is a great collection and you will realise, Mr. Speaker, that I have had representations from some of them about what they consider to be an invasion of the privacy of clubs as a result of Clause 114. I have also had representations from the Club and Institute Union.
    To be fair I have also had representations the other way from the Scottish Licensed Trade Association. I received a letter from Mr. Gordon, the Chairman of the Clackmannan and Stirlingshire Branch of the Licensed Trade Association, urging me to withdraw my amendment to delete Clause 114 because the association believes in liberalising all

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    drinking but believes in supervision, Including police supervision, anywhere where liquor is sold. In their opinion, that should include clubs.
    You will know, Mr. Speaker, that I am a politician who sometimes compromises, and I decided not to object to your not selecting Amendment No. 76 which would have deleted the whole of Clause 114. I hope that that compromise will satisfy Mr. Gordon and his colleagues in the Clackmannan and Stirlingshirc Branch of the Scottish Licensed Trade Association. I am prepared to accept Amendments Nos. 77 and 80 which provide a reasonable compromise.
    It is important that hon. Members as well as members of the S.L.T.A. should recognise that there is a real difference between the pub and the club. The pub, as the name implies, is a public place, whereas the club, in theory at least, is an extension of the home. It has a registered membership and it is only registered members and signed-in guests who can enter the club, and consume liquor there. It is democratically managed by an elected committee who generally do a good job. They have an internal disciplinary system by which they can expel people who misbehave or ban people temporarily.
    Many of the clubs do not merely concentrate on booze and bingo. Many provide welfare and cultural facilities. I cite the Bannockburn Miners' Welfare, my own club, as an example. They have indoor bowls and angling. I do not mean that the premises are used for angling but that there is an angling section within the club.
    The premises have been used for football changing accommodation. The local authority has only recently provided accommodation of its own. The premises are also used for a pre-school play group. The miners' welfare committee organises the annual children's gala and old folks' meals are served there twice or three times a week. The old folks' Christmas treat is held there annually. These gaps in local authority services are filled by the community services provided by this club and others. The real distinction between clubs and pubs is not recognised in the clause.
    There is more of a family atmosphere in clubs, but it could be destroyed if
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    the clause goes through without amendment. Many club members are concerned at the possibility of serious inroads into their privacy. Under existing legislation, I understand that a policeman may enter clubs only with a warrant or when in pursuit of a criminal. The Bill proposes a right of entry for policemen at any time and for any reason. A constable may take the names and addresses of any person on the premises if he believes, for example, that a club is being mismanaged or that an offence is being committed in the clubs. The constable can take the names and addresses of club members who have not committed any offence if he has reasonable ground for believing that an offence is being committed somewhere on the premises.
    This could create serious embarrassment and harassment and club members would resist what could become regular police raids. It would certainly spoil the atmosphere if one took one's wife to a club for a quiet drink and was interrupted by uniformed policemen going round the tables asking for names and addresses.
    More important, it would harm the relationship between the police and the community, which should be based on mutual friendship and trust. One of my drinking friends at the weekend is a local policeman and I know that he would resent having to follow his inspector's orders to go into the local club and take names and addresses. It would spoil the very good relationship that he has with the community. At 11 p.m. closing time, which would be the favourite time for police raids, policemen have enough to do looking for real criminals and villains elsewhere without snooping around clubs and public houses.
    The Government said they had made a slight concession in Committee by providing that only uniformed police officers should have the right of entry, but this makes it even worse. At least plainclothes officers could look relatively inconspicuous. The presence of uniformed policemen would destroy the whole family atmosphere in clubs.
    Under my amendment, police officers who had a reasonable suspicion that something illegal was going on in a club

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    would be able to enter with the permission of the secretary or a person authorised to act on his behalf or with a warrant. A club's registration could be cancelled if there were proven abuses of the law. I understand that such abuses are very infrequent. In 1972, the number of reported abuses was 15; in 1973, the figure was four; and in 1974, it was 13.
    8.30 a.m.
    Finally I would refer to some of the comments when the 1961 Licensing Act for England and Wales was going through Parliament. The then Minister of State at the Home Office said that one of the most valued privileges of clubs was freedom from police entry without a warrant and that it was a privilege that should be retained.
    When the matter was raised in the House of Lords the then Lord Chancellor, opposing a motion seeking to introduce the right of police entry into clubs, said that the Government could not accept the principle of entry by the police without warrant into club premises at any time, a proposal inherent in the motion. He said that the vast majority of opinion of all parties accepted that to allow the police to enter club premises at any time except for the limited purpose covered by the Bill would be unjustifiable interference with private liberties.
    That was in respect of the Bill covering England and Wales. It is interesting to note, too, that, in respect of the Scottish Licensing Bill of 1962, the right of the police to enter clubs was defeated by the vote of Parliament. That was at the time of a Conservative Government. It would be ironic if a Labour Government in 1976 were to interfere with clubs, many of whose members are ordinary working people who would deeply resent this invasion of their privacy. I support this amendment and the consequential amendment and ask for support from all sides of the House.
    Mr. Rifkind: The hon. Member for West Stirlingshire (Mr. Canavan) conjured up a terrifying picture of uniformed policemen, jackboots and all, invading indoor angling, including the kiddies' lounges, in his constituency. No doubt the local police force in his constituency might view with some alarm the inter-
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    pretation which the hon. Gentleman placed before the House should the clause go through in its present form.
    The crux of the problem is based on the simple fact that there are two quite different types of club. There are the clubs to which the hon. Member for West Stiriingshire referred, which are completely legitimate clubs, anxious to observe the letter as well as the spirit of the law. But we know that there are equally other clubs which have largely grown up as a result of the many alterations in our licensing laws. They are clubs in the technical sense of the word but in essence they are drinking establishments which have grown up simply to provide alcohol. It is that type of club in respect of which the Government rightly wish to exercise greater control.
    The question is how best this can be done in a way which will not jeopardise the legitimate interests of the proper clubs which do not seek or wish to break the law. For this reason I have put down Amendment No. 78, which seeks to provide a compromise, a middle ground, to try to deal with the problem which has been recognised by the Government. That amendment would allow a police officer in uniform to enter a club without a warrant only if he had reason to believe that the time that would elapse before such a warrant could be obtained would prevent the enforcement of the provisions of the Bill in that club. In other words, unless a police constable had reason to believe that the time which would elapse would frustrate his efforts, he would not be entitled to enter a club unless he had obtained a warrant.
    That is a safeguard, because it would protect the position of the private, respectable clubs where a police officer would have little reason to believe that an offence had been, or was being, committed and even less that his enforcement of the law would be frustrated by the need to obtain a warrant. In practice, those clubs would have nothing whatever to fear.
    Although, obviously, the amendment is not ideal, it seeks to meet the legitimate problem that the Government have described but without creating the very real sense of grievance and injustice felt by many of the respectable clubs. Therefore, if the House does not wish to accept

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    the amendment of the hon. Member, I hope that it will give the alternative amendment serious consideration. In some ways it is preferable in that it helps to recognise the problem which arises through the existence of two separate types of club.
    Mr. David Steel: At 8.30 in the morning, after an all-night sitting, some strange alliances emerge. I agree both with the hon. Member for West Stirling-shire (Mr. Canavan) and with the hon. Member for Edinburgh, Pentlands (Mr. Rifkind). I regard these amendments as very important. If the amendment to delete Clause 114 had been selected—I do not complain that it was not, because it was fully debated in Committee—I would have supported it.
    Some weeks ago I had a meeting with the Hawick Federation of Clubs. I must declare an interest as a member of three clubs in my constituency. In one town, membership of the Hawick Federation is 7,700. It impressed upon me the case for the maintenance of the distinction between a club and a pub. The starting point is that a club has control over its membership in a way that a pub does not have over its customers. Moreover, in a town like Hawick, if a member is suspended from a club because of bad behaviour, his name is circulated among the federation, so that he is kept out of other clubs as well. That is a strong discipline which does not exist among the pubs in the town.
    The clubs are very varied in character. I have even had correspondence on this issue from the Selkirk Conservative Club and the Innerleithen Unionist Club. My hon. Friend the Member for Inverness (Mr. Johnston) chastised the Church earlier for having written to him on only one matter. The only correspondence I have had with those two clubs has been over the matter of drinking. No doubt they are interested in other matters, and I do not blame them for expressing concern on this matter. [An HON. MEMBER: "What are your clubs?"] My three clubs are the Galashiels Liberal Club, the Hawick Liberal Club and the Jedburgh Liberal Club.
    Clubs have a real community function. Since I have been prompted, I would point out that the Galashiels Liberal Club has just won a prize as the ace of
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    clubs for raising a record amount to help fight muscular dystrophy—£1,500 in three weeks. This real club atmosphere in a community is of value, but the hon. Member for Pentlands put his finger on the point, which was the answer to what the hon. Member for West Stirlingshire said about the debates in 1962.
    Having read the Committee debates, I accept that there has been a tremendous growth in recent years in clubs existing for the purpose of drinking rather than for purposes of good fellowship. If that is a problem, it is a criticism of the licensing system itself. It is entirely wrong that because of this development in some parts of the country good, long-established, bona fide clubs should be penalised by the introduction of legislation like this when the real problem lies in controlling the mushrooming of clubs which are not genuine, if the Government feel that they exist.
    The police have adequate powers to enter a club if they feel that an offence has been committed. Although I pay tribute to the management of most of the long-established clubs in my constituency, sadly in the last 10 or 11 years I have known of one or two cases of prosecution, one for transgression under the betting and gaming laws. Another concerned the hours of drinking, and in that case the club lost its licence. I therefore do not pretend that there are not occasions when a club falls under bad voluntary management. My point is proved by the fact that the police were able to take action. No case has been made out by the Government showing that the police are powerless, because they have used their existing powers.
    Clause 86 defines the powers of the police to enter unlicensed premises where they suspect that alcoholic liquor may be being consumed. We find spelt out there much more generous treatment of public premises. A warrant is required, and so on. I see no reason why that wording should not have been applied to the clubs. If it had been, it would have left the law largely as it is now.
    The hon. Member for West Stirlingshire has raised a serious matter. If this kind of measure is introduced without serious thought being given to it by the House, it may result in a deterioration in relations

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    between the police and the public. People believe that if they go to their clubs and behave properly they should not expect uniformed police to come in. This is a new departure which does not exist in the law of England. I am all for pioneering in the law of Scotland, but this is the wrong way to pioneer.
    I think that the House would be well advised to support Amendment No. 77 or, if that were to be defeated, Amendment No. 78. That is the course I propose to follow.
    Mr. T. W. Urwin: I intervene in the debate in the full knowledge that I am not a Scottish Member of Parliament representing a Scottish constituency and did not serve on the Standing Committee. Having, however, sat through the long hours of the night and listened intently to the debates on the multiplicity of amendments which have been moved, I wonder why we cannot have the law of universality applied to licensing laws throughout the United Kingdom. I am sure that everybody would be a good deal happier if that were the position.
    I hope that in the circumstances my lion. Friend the Member for West Stirling (Mr. Canavan) and the rest of my right hon. and hon. Friends will not form the opinion that I am fishing in prohibited waters. I know that when my hon. Friend is not fishing he is frequently mending his nets. That is his business.
    I am concerned about Clause 114 and the serious implication contained therein regarding the automatic right of entry of the police into clubs, but more especially working men's clubs. My hon. Friend has properly and justifiably gone to some lengths to point out that a club is not only a respectable place catering for respectable people and in which there are very few cases of drunkenness, but that it is frequently the hub—indeed, the very axis—around which community life revolves in many places, and certainly in small villages.
    I became even more concerned when my hon. Friend referred to the discussions he had had with representatives of the Club and Institute Union Ltd. The House should bear in mind that just
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    over 4,000 clubs are affiliated to the union—I stand to be corrected—and that 100 of them are in Scotland.
    It is within my knowledge and surely that of the majority, if not all, of my right hon. and hon. Friends that, as was pointed out by the hon. Member for Roxburgh, Selkirk and Pebbles (Mr. Steel), the clubs are invariably well managed. They have a high degree and a well-formed code of discipline. When members fall from grace—for example, if they are guilty of serious misdemeanour—the club management committee has power under the rules to exclude them from membership. That applies throughout the federation clubs in the areas concerned.
    The question of the automatic right of entry by the police has always been vigorously resisted by the Club and Institute Union Ltd.—certainly by the member clubs throughout England. If there is a fracas or disturbance in a club, the police should enter only at the request of the club secretary, chairman or other responsible member of the committee acting on behalf of the management. That is a fundamental right of members of working-men's clubs. I fear that if the amendment is not accepted there may be a departure which will be strongly resisted when we discuss the future licensing laws of England. I hope that my right hon. and hon. Friends will consult the officials of the union to discover their attitude to the amendment.
    8.45 a.m.
    Mr. Monro: A number of eloquent speeches were made in Committee on this issue. Like the hon. Member for Roxburgh, Selkirk and Peebles (Mr. Steel), I have received a number of letters from clubs, including some from his constituency. I also received some from Lanarkshire, Perthshire and all points on the Scottish compass. The clubs which I have personally visited are extremely well run. One of the advantages of belonging to a clubs is that a committee vets applicants for membership in order to maintain a high standard.
    At its conference in Blackpool in the spring, the Club and Institute Union Ltd. was emphatically against the police being given the right to enter clubs without a warrant. In Committee we were disappointed at the Minister's attitude, although he has tabled his promised amendments

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    which establish that police officers must be in uniform. In the light of the evidence, I support the amendments which would prevent police from entering a private club without a warrant for that purpose.
    Mr. Robert Hughes: Like many hon. Members I have received representations, and I suppose that I should declare an interest as a member of two clubs in my constituency. I have received representations from the Club and Institute Union Ltd. about the entry of police officers to licensed premises.
    The burden of the union's argument is that a club is so private that it is an extension of an individual's home—but that is too tight a definition. It is not simply that many clubs which have grown up are merely drinking places. Most clubs provide entertainment. There is a growth in the number of clubs which began as purely drinking associations, while at the same time even established clubs are extending their range of activities and providing more entertainment. The balance of the argument is shifting towards the club being an extension of entertainment rather than an extension of the home.
    We cannot necessarily rest on the previous arguments about privacy. I believe that the fact that a uniformed constable has the right of entry at any time could well, in certain circumstances, improve relations with the management. We all rightly have a healthy disrespect for the police in that they represent a kind of authoritarianism which some of us suspect might be used in a way alien to the true purposes of the police. The hon. Member for Berwick-upon-Tweed (Mr. Beith) grimaces from a sedentary position, but I think that that is a common feeling.
    Having considered all the arguments, I believe that on balance it is probably better to support Amendment No. 77.
    Mr. Harry Ewing: It is a wise Minister who knows when he is on a loser, and I know that I am on a loser now. If all the amendments are withdrawn, we shall give an undertaking to reinstate the original position. I think that that would be the best course.
    Mr. William Ross: Before my hon. Friend sits down, may I express the hope that he will appreciate that we have heard a great deal about the Guest Committee
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    and the Clayson Committee tonight? It was the recommendation of both those committees that this should be done. No arguments have been heard tonight in support of what was said by the Clayson Committee, the Law Society of Scotland, the Association of County Councils in Scotland—
    Mr. Fairgrieve rose—
    Mr. Speaker: Order. The right hon. Gentleman is asking the Minister a question after the hon. Gentleman has sat down.
    Mr. Ross: I was asking my hon. Friend to take account of those views, Mr. Speaker. I think that I am still entitled to speak in this House.
    Mr. Speaker: Order. Of course the right hon Gentleman is entitled to speak, when he is called, but I understood that he said "Before my hon. Friend sits down". In that case, he must be treated the same as every other Member.
    Mr. Harry Ewing: We have taken account of what Guest and Clayson said and of what the Club and Institute Union Ltd. said. We had a long meeting with the CIU at St. Andrew's House.
    I think that I have the sense of the House, and for that reason I propose to proceed as I have suggested.
    Mr. Gordon A. T. Bagier: Before my hon. Friend sits down, will he make it absolutely certain that what he is saying means that we return to the situation in which a warrant is required before police may enter a private club?
    Mr. Ewing: That is the position.
    Mr. Dalyell: My constituent Mr. William Meikle, of The Rendezvous in Bathgate, who occupies the position of vice-president, Mr. James Boyle and others in West Lothian have said that the one thing they really want pressed is opposition to this amendment. If the clubs have nothing to worry about and are doing everything right—and this is the question the publicans ask—why do they feel that they should be treated differently from those who run public houses? That is a question that has to be answered at some stage.
    Mr. Canavan: I am grateful to my hon. Friend the Minister for his generous and realistic concession. I am only sorry that we do not have the support of my right hon. Friend the Member for Kulmamock (Mr. Ross) and the hon. Member for West Lothian (Mr. Dalyell).
    Mr. William Ross: The Scottish Trades Union Congress took the view that if clubs were being properly conducted within the law they could have no possible objection to the police being given the right of entry. There is a considerable list of people in support of the Government's original position who have not been mentioned yet.
    Mr. Canavan: One could equally argue that a man sitting at home with his wife and family need have nothing to fear from a proposal to give the police power to enter his home without a warrant, but he would still resent such a proposal. That is the logic of the argument of my right hon. Friend and of my hon. Friend the Member for West Lothian.
    Mr. McCartney: Have not successive Ministers in successive Governments stated that they were not required to accept the recommendations of such bodies?
    Mr. Canavan: That is perfectly true.
    I should like to thank the Minister and Members of all parties, with the exception of the SNP, which has not given a view on the subject so far, and my colleagues south of the border, who are naturally involved too, for their support. I conclude by asking my hon. Friend to give me a straightforward "Yes" or "No" to my question: will he now give a 100 per cent. guarantee that an amendment will be introduced in the Lords to restore the status quo—not the original proposals of the Bill but the present position as it exists in law—in respect of the rights of the police to enter clubs?
    Mr. Harry Ewing: For the third time, I give my hon. Friend the assurance that we shall reintroduce the status quo.
    Mr. Canavan: I thank my hon. Friend very much. I beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.

  Clause 124

    LOCAL AUTHORITY PREMISES
    Mr. Rifkind: I beg to move Amendment No. 84, in page 76, line 37, after 'may', insert
    'subject to the approval of the sheriff'.
    I understand that with this we are to discuss the related amendment, No. 85, in page 76, line 37, leave out 'any' and insert
    'an entertainments licence but no other licence'.
    Clause 124 is a completely new departure in licensing law as it seeks to repeal the restrictions of previous legislation that in effect prevented a local authority from granting a licence to itself for the conduct of licensed premises.
    We had a very full debate on this subject in Committee, but I should like to restate the basic issue. Many of us believe that it is positively undesirable that a local authority should be both judge and jury in its own case. The licensing board will consist entirely of persons who are elected councillors. Therefore it is wrong in principle, dangerous in practice, and likely to create a harmful impression on the public if a local authority makes an application to the board for a licence to conduct licensed premises. There is an essential conflict of interests here.
    9.0 a.m.
    We know that the Bill makes many specific provisions that no one is entitled to sit on a licensing board if he has any direct or indirect interest in an application to that board. But Clause 124 is an exception to that necessary and desirable rule. It will give the local authority a privileged position in society in that it will be able to apply to a board consisting entirely of its own members for a licence.
    In supporting this provision in the Bill, the Minister argued that it was necessary for a local authority to have this right to provide licensed premises for itself, its own staff, or institutions run by it in matters covered by entertainment licences. As this was the only argument put forward by the Minister we have put down an amendment to restrict this right on the

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    basis of that qualification. The Minister's argument would be fully covered by restricting the type of licence granted by a local authority to itself to entertainment licences.
    Amendment 84 is an additional protection in that it provides that the granting of licences should be subject to the approval of the sheriff.
    I would argue that in a situation where a local authority that this privileged position, as far as its own licence applications are concerned, there should be not just an appeal by another party to the sheriff but an automatic requirement that he should consider whether the granting of the licence is justified.
    This is the old principle of justice being seen to be done as well as actually being done. The public would feel grieved if they thought that a local authority was granting itself a licence—particularly if it were a contentious licence, or one which might be objected to. Undoubtedly members of the public would feel grievously prejudiced knowing that the application for a licence had gone from local councillors to a licensing board consisting of the same local councillors. That is not a desirable impression to make on the public.
    I am not seeking to denigrate local authorities. This amendment is necessary for the protection of local authorities themselves so that there can be no questioning of their integrity and no claiming that they have a privileged position in society in respect of licensing. In its present form, the clause raises such objections.
    I hope that the Minister will accept the amendment to restrict a local authority's applications to those circumstances which the Minister himself said were the only circumstances provided for when he introduced this clause in the first place.
    Mr. Harry Ewing: I am not prepared to accept the amendment, but if the hon. Member will withdraw it I will consider which types of licence can be granted to local authorities.
    The amendment suggested is far too restrictive, and we certainly cannot agree to licences being granted by the sheriff when there is already a built-in appeal to the sheriff.
    Mr. Rifkind: I am grateful to the Minister for that generous offer. It is generally accepted by everyone including the Minister that it is highly unlikely that a local authority will apply for a public house licence, but nothing in the Bill would prevent it from doing so. I am grateful that the Minister has offered to consider whether there could be a restriction on the kind of licence for which local authorities can apply. That would meet the legitimate objective without creating potential prejudice, which we are anxious to avoid.
    I beg to ask leave to withdraw the amendment.
    Amendment, by leave, withdrawn.

  Clause 128
    TRIAL OF OFFENCES
    Amendment made: No. 86, in page 78, line 16 leave out '7(2), 7(3)'.—[Mr. Milian.]
  Clause 131

    TEMPERANCE AREAS
    Mr. Millan: I beg to move Amendment No. 87, in page 78, line 40, leave out 'five' and insert 'three'.
    The effect of the amendment would be to reduce from five to three years the period after which the local authority could resolve that a limiting or no-licence resolution had effect. We have decided to abandon the present legislation in respect of local polls for either limiting or no-licence resolutions, and the Bill provides that there should be transitional provisions. The transitional provisions in the clause freeze the situation for five years, but, following that, nothing happens until the local authority passes a resolution.
    We have considered the matter again since Committee stage and I now believe that, given other safeguards in the clause, a freeze period of three years is adequate to allow for preparation for adjustment to a new situation. Even after the three years there is no automatic movement. A resolution by the local authority concerned is needed.
    I have some of these resolutions in force in my constituency and I therefore know something of the feeling on these matters in the past. We are abandoning that system, however, and the point of principle has been conceded. Therefore,

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    the three-year freeze period would be adequate, and I hope that it is acceptable to the House.
    Mr. Teddy Taylor: In his brief explanation of the amendment the Secretary of State gave no reason for the change embodied in the amendment. Has he had representations on the matter? Has he received letters? Has there been great protest in his constituency? Are the people pressing to get rid of their "dry" and limitation areas as quickly as possible? Let me suggest that there has been no such pressure.
    There are a small number of areas in Scotland where restrictions are imposed because of veto polls. They are listed at the end of the Clayson Report. Some of these are "dry" areas. Half of my constituency is "dry". That does not mean that there is no drinking, only that there are no licensed premises apart from clubs or a licensed restaurant if the need for it is proven.
    There have been arguments against veto polls for many years, and there has grown up a remarkable organisation called the Licensed Trade Veto Poll Defence Fund which was set up to defend publicans against veto polls. Under Scottish law the people in any area can get together and vote "dry" or limitation. To secure that there must be at least a 35 per cent. poll and a majority of those voting in favour. There have been few veto polls of late.
    On the other hand, there is no doubt that in this small number of areas it is looked upon as a valuable safeguard for the community. We have heard a great deal from the Government about wanting to extend democracy. We do not hear so much about that from moderate Labour Members, such as the hon. Member for Berwick and East Lothian (Mr. Mackintosh), but some of the wilder Left-wingers have talked about the need to extend democracy. They want to bring back democracy to the people and let them play a greater part in their own destiny. That is what the veto poll was all about. It gave people the right to decide whether they want to have no pubs, a few pubs, a limitation arrangement or a straight "wet" condition in their area.
    I appreciate that there was unfairness and injustice. For example, a pub-
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    lican might have said that he wanted to spend £100,000 on building a new public house in the constituency of the hon. Member for Berwick and East Lothian. That would have been a substantial investment. The money might have been secured, only to find that there was a veto poll and that the public house had to be closed. That meant that the investment was lost. There is no doubt that that was of real concern to those who wanted to make investments by building public houses and licensed pre-mires. That is why a splinter organisation set up a veto poll defence fund. The fund was established so that if there were a veto poll in any area an organised campaign could be mounted and some compensation paid to those who might be affected. That was a form of insurance organised by a reputable organisation.
    Substantial sums have been put into the fund. What will happen now that the fund is to be abolished? No doubt the money will have to go somewhere. I hope that it will be used for the benefit of the people of Scotland. I hope that it will be directed to the maintenance of their health and welfare. The Secretary of State may know something about the fund. It would be good to know where the money is going. I know that I have no right to ask about that as it is not my money or money that should belong to the people of Cathcart.
    Under the Bill the Government are abolishing veto polls as from the enactment of the Bill. That means that the threat will be removed. No longer will a publican think of building a giant pub somewhere in Scotland only to be faced with the threat of a veto poll. As from the enactment of the Bill the fund will be closed down.
    In the ward of Graigton there were changes from "dry" to limitation to "wet". That was a classic area about which people talked about. They said that it was ridiculous to change in that way. It was said that the publicans did not know where they welt or how they stood.
    That threat has been removed because there will be no more veto polls as from the enactment of the Bill. All that remains to be resolved is what happens to

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    the areas that are now "dry" or limitation. The Government proposals envisage that on a certain date we shall open the "dry" areas and the limitation areas to the great gold rush of publicans. They will rush into the "dry" areas to have a profitable and, no doubt a happy time. That will happen. The only question is when it will take place.
    I have an interest as half of my constituency is "dry" and the other half is limitation. The old Cathcart Ward is a "dry" area. That means that unless one is a member of the Labour Party, an ex-Service man who can apply for membership of the British Legion or a bowls player it is difficult to get a drink in the ward.
    There is limitation in the Langside Ward. There is one real hotel, not one of the funny hotels that have been mentioned. There are also some licensed grocers and one pleasant eating house that has a bar of a sort.
    Those two parts of my constituency will be opened up by the Bill. Obviously I am concerned. The previous Secretary of State for Scotland—I had a high regard for him and I told him so publicly and privately—accepted that we had a problem in such areas and he wanted to do something about it. I understand that it was largely because of his good nature and his interest in places and people that he introduced a five-year clause whereby people in these areas would have their position protected for at least five years, and thereafter it was up to the local council or licensing board to decide what happened.
    9.15 a.m.
    I was not happy with that because I wanted to keep the veto polls, and when we discussed it in Committee I moved a splendid amendment, saying that we should have a temperance poll in various areas and basically continue the provision of the temperance poll. Unfortunately, the majority of the Committee did not vote for my amendment. I had the support of my hon. and learned Friend the Member for Kinross and West Perthshire (Mr. Fairbairn) but there were not many other Members who supported me.
    This was a valuable debate, because the Under-Secretary of State gave me some assurances which not only pleased me but helped me, as I think he would
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    agree, to become a lot more co-operative—even more than I had been—in regard to the passing of the Bill. The Minister was certainly very kind. He said:
    "As a result of our consideration of this very difficult problem—because it affects people—we decided that we would introduce certain safeguards. The first of these safeguards was that there would be a five-year period. There would be no veto polls for that five-year period but, equally, in that period there would be no possibility of a dry area becoming wet."
    My constituents were very pleased to note this, and I took it as a gesture of good will on the Minister's part. I think he will agree that I became even more co-operative in the Committee. The Minister added, later in his speech:
    "To summarise, we have built in safeguards which we consider adequate to meet the changing circumstances."
    When he was asked about it, the Minister said:
    "I strongly suspect that the Committee is of the mind that we have got this matter right.… I believe that it would be in the best interest of future licensing legislation if we were to adopt the course defined in the Bill."—[Official Report, First Scottish Standing Committee, 1st July 1976; c. 798–800.]
    My constituents were very happy, and because of that I entered the next sitting of the Committee in a frame of mind which I think the Government will accept was far more conducive to co-operation than previously. Not only had I to convince the Government but also my hon. Friends, who were extremely kind to me, because they had received representations from the licensed trade and the brewers.
    My hon. Friends considered each representation on its merits. There was no question of Tories acting as rubber stamps for the brewers. Such arguments are quite untrue and unfounded. We did not act as rubber stamps for the licensed trade, which was asking for a reduction from five years to three. An amendment was therefore tabled, more as a probe than anything else, but when I discussed it privately with my hon. Friends they were very kind and understanding and agreed to withdraw it. We then discussed my amendment instead, and the Minister made a splendid speech.
    Now we have a situation in which my constituents will be very unhappy indeed, because, having—
    Mr. McCartney: We have already had the referendum.
    Mr. Taylor: The hon. Gentleman might be interested to know that we had a veto poll in Cathcart, when there was a council there, and in that poll 12,000 people voted. The licensed trade was strongly urging them to vote "wet". As far as I recall, 10,000 voted "dry" and 2,000 "wet". That was a clear expression of the people of Cathcart, which includes the largest housing estate in Europe. The majority of the people in the housing estate were in favour of keeping the area "dry". The views of the people were quite clear, and they were very happy indeed with the result. They were also very happy at the Minister's speech.
    But the Minister has not been very helpful, co-operative or friendly towards me today. He has stated that the Government, having reconsidered the question, have changed their mind. It is something which affects only a very small number of areas in Scotland and they are all clearly defined. The Minister now says that three years are enough, rather than five.
    Representations were made by the licensed trade saying that it wanted the period reduced from five to three years. We received no reasons from the Minister why this period was thought to be enough, nor were there explanations why five years was thought to be the right period. However, the Secretary of State said that he had reconsidered the matter and proposed a period of three years. What is the appropriate period?
    If we change a "dry" area to a "wet" area, as the Government propose, a major upheaval is involved. Five years is the minimum period in which we may plan for such a change. It will be a major change. We shall not like it. The Minister may say that the local council will protect the local people. However, the people in Cathcart do not always think that the local council necessarily protects them to the fullest degree. The Glasgow District Council does not have a unique record among Scottish local authorities of paying regard to the interests of areas on the periphery of the city. Sometimes my constituents have been unhappy about its decisions. They have the impression that it does not look upon Cathcart with the same concern and regard as it looks upon other areas
    572
    of the city. We do not look upon that as any protection.
    It would be sensible to leave the period of five years in the Bill. I shall be much happier if the temperance areas remain as they are for all time, unless the people vote for a change. We may do away with temperance polls if they are considered a threat. But are they a threat? How many temperance polls have there been recently? How many publicans have been affected? How many pubs have been closed? Until now this process had developed well and logically in Scotland. Matters had settled down nicely.
    This proposal will mean a change in my constituency. One of the other areas affected will be Craigton, which the Secretary of State represents. I do not know Craigton. Although I do not wish to go into details, one of my friends was a councillor in that area. I gained the impression from him that the local people valued their position as inhabitants of a limitation area. It is now proposed that the period should be three years. Has the Secretary of State any evidence from the people in the area affected that they regard three years as adequate and that they are opposed to five years? As he proposes a major change, there should be some evidence. It is all very well to say that the brewers, the licensed trade and county council associations think that three years are enough, but what about the people? The Under-Secretary said that we had to be careful as the proposal would affect the people. What evidence is there from the people? Has there been any indication from the people who live in these limitation or "dry" areas that they feel that three years are preferable to five? I suggest that there is not a shred of evidence that that is so.
    The amendment will mean a fundamental change in my constituency. Mine is the only constituency which is totally covered by limitation or "dry" areas. Neither my constituents nor I are looking forward to the implementation of this proposal. We felt that the five-year period, which the Secretary of State first offered, was the minimum that was reasonable in all the circumstances. I hope that the Minister will now reconsider his position. I hope he will say that the Government will not at this stage of the Bill cause unnecessary conflict.

    573
    We accept what the Under-Secretary said in Committee. He said that he had given careful consideration to this difficult problem and had arrived at the decision that five years was the right period.
    I hope that the Minister will answer my specific questions and say whether those who live in these areas have expressed any view whether three years—not five years—is the right period.
    Mr. Millan: We are dealing with a simple matter on which I gather the hon. Member for Glasgow, Cathcant (Mr. Taylor) disagrees with me. I can put up with that. In my area I dare say that those of my constituents who voted originally for the limitation resolution would like it to continue for as long as possible and those who voted against it would like it removed as soon as possible.
    We have to make a judgment. Three years is a reasonable transitional arrangement, particularly as at the end of that period nothing happens automatically. There is a requirement for a resolution of the district council.
    Question put, That the amendment be made:—
    The House proceeded to a Division—
    Mr. JAMES HAMILTON and Mr. IAN CAMPBELL were appointed Tellers for the Ayes but, no Member being willing to act as Teller for the Noes, Mr. SPEAKER declared that the Ayes had it.
    Question accordingly agreed to.
    Mr. Teddy Taylor: I beg to move Amendment No. 88, in page 78, line 44, leave out 'consult with' and insert'obtain the agreement of'.
    This amendment is crucially linked with Amendment No. 87. It introduces the safeguarding provisions which the Government said that they were introducing. I am bitterly disappointed that I could not get support for my previous amendment. That is because only a few areas are affected. I am sorry that the right hon. Member for Orkney and Shetlands (Mr. Grimond) is not here. Two small islands in his constituency are similarly affected and if he had been able to be here he would have supported me.
    Clause 131(3) reads as follows:
    "Before making any resolution as mentioned in subsection (2) above,"—
    574
    which would effectively do away with the "dry" status or the limited status—
    "the district or islands council shall consult with the community council or councils for the area concerned."
    I propose that it should obtain the agreement of the community councils for the area.
    Community councils have virtually no executive power. They do not have rights. They have only power to look at matters and to be consulted. It might be argued that community councils are not representative of all the people in the area but they are about the closest we can get to a representative body.
    The hon. Member for Glasgow, Pro-van (Mr. Brown) might suggest the tenants' association, but in my experience a tenants' association would not necessarily be representative of the people in the area. Residents' associations do not necessarily represent anyone. They consist of a few activists. In Parliament we are activists, so we know what that means—five or six people meeting in a room and saying that they speak on behalf of 20,000 people. That is not necessarily—
    9.30 a.m.
    Mr. David Steel: The hon. Member always claims that—
    Mr. Taylor: I think the hon. Member for Roxburgh, Selkirk and Peebles (Mr. Steel) is not showing the objective approach one should expect of the Leader of a party. In a rather jaundiced way he is giving the impression that all he wants is to get to his bed as quickly as he can. The leader of a party has the obligation of having to wait up late at night and to consider important matters. If the hon. Member is one day the Prime Minister he will undoubtedly have—
    Mr. Speaker: Order. Back to "obtain the agreement of".
    Mr. Taylor: We have these community councils. They were set up under Scottish local government reform. That was one of the many reforms introduced by the Heath Administration. They introduced a large number of reforms. Some of my colleagues believe that there were too many. One was local government reform, and in that we set up districts and regions which were larger than under previous local government arrangements. It

    575
    was thought that there should be local bodies to represent local opinion at local level, and so we set up community councils. This Government, in this clause, have shown their resolution to make an area "wet" or "dry" unless it consults the community councils.
    If we are to encourage a democratic interest in their own affairs, it is essential that the agreement of the community councils should be obtained before a resolution is made, otherwise people in another locality will make a decision for that locality. I hope that the Government will enable my amendment to be made. They have already done a great deal of damage to my constituency. It would be wrong and shameful if this arrangement to ensure that a decision is made in agreement with the community councils were not included in the Bill.
    The number of times we write into legislation a duty to consult causes me great concern. We do this in many Bills at present. I can remember the hon. Member for Central Ayrshire (Mr. Lambie) speaking a great deal about the Central Development Agency and its duty to consult everybody. Many people are getting a little muddled about consultation and what it means. It is in no way a guarantee of justice, and I should like to think that in this Bill we shall try to have some justice.
    What is wrong with the community council, representative of the people in the area, having the right to say "Yes" or "No" to a major proposal which affects the people and the way of life of the community in that area?
    The Minister, who has done me badly and my constituency ill, should make a small concession at this late stage. Frankly I feel that on the Committee I was misled, probably largely through my own fault. I am basically a trusting person and I thought that something would emerge for my constituency from the Bill. I am not accusing the Secretary of State of treachery but because I am a trusting person I took his words as a firm declaration. I ask him to make amends by a small and reasonable amendment which will affect only a tiny
    576
    number of areas in Scotland but which will undo some of the damage done by the Government's proposals.
    Mr. Millan: The clause provides for consultation with community councils, which is the right relationship in a matter of this sort. The amendment would take the decision on this subject out of the hands of the district council and give it to the community council. It would mean that the community council had a veto over the local authority.
    I do not want to go into the history of community councils—they are only now being set up—but that was not the relationship intended in the 1973 Act and the amendment would be incompatible with the relationship that was intended. I hope that full account will be taken of the community council's views, but the decision must be for the district council.
    Amendment negatived.

  Clause 132

    CURRENCY OF FINAL LICENSING CERTIFICATES
    Mr. Harry Ewing: I beg to move Amendment No. 89, in page 79, line 22, leave out 'Applicants for certificates' and insert
    'The chairman of the licensing court'.
    Mr. Speaker: With this, we may take Government Amendment No. 90.
    Mr. Ewing: Amendment 89 has been put down to solve a problem, foreseen by some of the larger licensing authorities, of having large numbers of licence holders gathered together in one place to draw lots. We decided that it would simplify matters if the chairman drew the lots instead of the applicants.
    Amendment 90 has been put down to meet a point raised by the hon. Member for Edinburgh, Pentlands (Mr. Rifkind) in Committee. It will allow those licensing authorities whose numbers of licence holders are not sufficient to justify a division into nine groups to divide them into fewer group if they so desire.
    Amendment agreed to.
    Amendment made: No. 90, in page 79, line 27, after 'groups' insert 'or less'.[Mr. Millan.]

  New Schedule
    'SUNDAY OPENING OF PREMISES IN RESPECT OF WHICH A PUBLIC HOUSE LICENCE OR REFRESHMENT LICENCE IS OR WILL BE IN FORCE AND SUNDAY RESTRICTION ORDERS RELATING TO LICENSED PREMISES

      PART I
      Applications for Sunday opening
      1. Applications may be made to a licensing board in accordance with the provisions of this Schedule for permission to open premises on Sundays as mentioned in section 54(2) of this Act, and any such application is referred to in this Schedule as "an application for Sunday opening".
      2. The holder of a public house licence or a refreshment licence in respect of any premises may make an applicaion for Sunday opening of the premises, and any such application shall be in such form as may be prescribed, shall be completed and signed by the applicant or his agent, and shall be lodged with the clerk of the licensing board within whose area the premises are situated not later than five weeks before the first day of the meeting of the board at which the application is to be considered.
      3. The clerk of a licensing board shall, not later than three weeks before the first day of the meeting of the board at which the applications are to be considered, cause to be published in one or more newspapers circulating in the area of the board a list of all competing applications for Sunday opening made to the board under paragraph 2 above.
      4. The list mentioned in paragraph 3 above shall specify—

      (a) the name, designation and address of the applicant;

      (b) the address of the premises in respect of which the application is made;

      (c) the first day of the meeting of the licensing board at which the application is to be considered.

      5. It shall be competent for any person mentioned in section 17(1) of this Act to object in relation to any application made under paragraph 2 above, and the provisions of subsections (2) to (4) of that section shall apply in relation to such objections.
      6. A licensing board shall refuse an application made under paragraph 2 above if it is satisfied that the opening and use on a Sunday of the premises to which the application relates would cause undue disturbance or public nuisance in the locality, but otherwise shall grant the application.
      7. The consequences of the refusal of an application under paragraph 6 above in respect of any premises is that there shall be no permitted hours in those premises on a Sunday.
      8. An applicant may appeal to the sheriff against a decision of a licensing board to refuse an application under paragraph 6 above.
      9. Any competent objector who appeared at the hearing of any application made under paragraph 2 above may appeal to the sheriff
      578
      against a decision of the licensing board to grant the application.
      10. A licensing board shall not within two years of its refusal of an application made under paragraph 2 above in respect of any premises enterttain another such application in respect of those premises.
      11. An application for a new public house licence or refreshment licence under section 11 of this Act shall state whether the applicant is making an application for Sunday opening, and if an application for Sunday opening is made, the clerk of the licensing board shall include in the list mentioned in section 13(1) of this Act information to that effect.
      12. Paragraphs 5 to 9 above shall apply in relation to an application for Sunday opening under paragraph 11 above as they apply in relation to an application for Sunday opening under paragraph 2 above.

      PART II
      Sunday restriction orders
      13. Where on a complaint being made to a licensing hoard by any person mentioned in section 17(1) of this Act, the hoard is satisfied that the use of licensed premises is the cause of undue disturbance or public nuisance having regard to the way of life in the community in the locality on a Sunday, the board may make an order (in this Part of this Schedule referred to as a "Sunday restriction order"), and the effect of the Sunday restriction order is that there shall be no permitted hours on Sunday for such period as may be specified in the order or that the permitted hours on Sunday shall be reduced by such time and for such period as may be so specified.
      14. The provisions of subsections (4) to (6) of section 33 of this Act shall, with any necessary modifications apply in relation to a Sunday restriction order as they apply in relation to the suspension of a licence.
      15. The licensing board may make a Sunday restriction order in relation to individual premises or in relation to a group of premises in respect of which the same type of licence is held.
      16. Subsections (4) to (8) of section 65 of this Act shall apply in relation to a Sunday restriction order as they apply in relation to a restriction order under that section.'.—[Mr. Milian.]
      Brought up, and read the First and Second time.
      Amendment proposed to the proposed schedule, (a) in paragraph 6 after 'locality', insert
      'or is opposed by the residents of the locality'.—[Mr. Teddy Taylor].
      Amendment to the proposed schedule negatived.
      Schedule agreed to and added to the Bill.

Schedule 4

  PENALTIES FOR OFFENCES AGAINST PROVISIONS OF THIS ACT
  Amendments made: No. 94, in page 91, leave out the items relating to section 7(2) and (3).

  "Section (Occasional permissions) (3)

  Contravention of condition of occasional permission.

  —

  —

  £100.

  Section (Occasional permissions) (6)

  Failure to ensure observance of provisions relating to conduct of licensed premises

  —

  —

  £100"

  —[Mr. Millan.]
  Mr. Millan: I beg to move Amendment No. 98, in page 96, column 2, in the item relating to section 78(2), leave out 'and disorderly behaviour' and insert:
  'drunkenness, or riotous or disorderly conduct'.
  This is a drafting amendment.
  Amendment agreed to.
  Amendment made: No. 99, in page 96, column 2, in the item relating to section 80, after 'prostitutes' insert 'etc'.—[Mr.Millan.]
  Mr. Millan: I beg to move Amendment No. 100, in page 97, column 2, in the item relating to section 86, after 'constable' insert 'or obstructing his entry'.
  Mr. Speaker: With this we may take Government Amendments Nos. 101, 102, 103, 104, 105.
  Mr. Millan: These are all drafting amendments.
  Amendment agreed to.
  Amendments made: No. 101, in page 97, column 2, in the item relating to section 87(1)(a), leave out 'Permitting on-consumption of' and insert 'Selling or supplying'.
  No. 102, in page 98, column 2, in the item relating to section 90(b), after 'Bartering' insert 'or selling'.
  No. 103, in page 98, column 2, in the item relating to section 91(2), after 'Carrying' insert 'or delivering'.
  No. 104, in page 100, column 2, in the item relating to section 100(a) after 'Trafficking' insert 'in'.
  No. 105, in page 101, column 2, in the item relating to section 101(1), after 'in' insert 'or supplying'.—[Mr. Milan.]
  No. 95, in column 2 in the item relating to section 31(2), leave out 'or wine'
  No. 96, in page 91, after the item relating to section 35, inesert the following items—
  9.40 a.m.
  Mr. Millan: I beg to move, That the Bill be now read the Third time.
  I did not intend to say anything about the Bill at this stage and I hope that the House will excuse me if I do not talk about its merits. I would simply say that we now have a Bill with, from my point of view, one major defect in respect of Sunday drinking, but in other respects it makes important and useful changes in the licensing law of Scotland.
  I would congratulate all hon. Members on both sides of the House who have stayed throughout this long sitting to enable us to complete Report and Third Reading. I am extremely grateful to all hon. Members, whatever their views. I am grateful to them for staying and for the friendly way in which the debates have been carried on in spite of our differences of opinion.
  9.41 a.m.
  Mr. Buchanan-Smith: I would also like to say a few brief words. I feel that the Report stage and Third Reading of the Bill is a testimony to the endurance of all hon. Members who took part. I would also like to thank all hon. Members on both sides of the House for the way in which the Bill has been handled. I would extend my personal thanks to the Under-Secretary of State for Scotland who has carried the burden of the Bill through Committee and Report. I also particularly welcome the way in which the Government have responded to amendments put forward by the Opposition. I feel that we now have a better Bill than it was when we first considered it and I would commend it to the House, in spite of that part of it which I know the Secretary of State feels is a defect.
  It would be a mistake if we thought of the Bill as providing only for the

  581
  class pubs, open seven days a week. I opening of pubs on a Sunday. That would be a disservice to Dr. Clayson and his colleagues. Just as Dr. Clayson and his colleagues tried to produce a balanced report—and we must view that report in its totality—so our job is to view the Bill in its totality. There are many good aspects to the Bill, quite apart from the fact that individuals may have certain reservations about particular parts of it.
  I particularly welcome it because I feel that it is a liberalising measure. I hope that when it comes into effect in Scotland it will fulfil the aspirations of Dr. Clayson and all of us who have supported it. It is important to remember that we are dealing with human behaviour and that it is impossible to legislate in respect of human behaviour. I certainly hope that it leads to better attitudes in Scotland towards alcohol.
  Dr. Clayson said in his report that he hoped that the effects of the liberalising measures which he recommended, if carried through, would be monitored, None of us with the best will in the world, whichever side we take on the argument, can be certain what the results will be. I hope that the Government will carry through the monitoring that Dr. Clayton recommended because that would help us to evaluate properly and precisely what the effect of the Bill will be. I welcome the measure and thank all those who have been involved with it.
  9.44 a.m.
  Mr. David Steel: I would briefly say that my view on how we have legislated has not differed from the start of the evening but despite that I thank the Secretary of State and the Under-Secretary of State for the way in which they have handled the Bill during the all night sitting.
  They have both shown a degree of brevity and flexibility which I do not normally associate with Scottish Office Ministers. As I am one who is always ready to criticise Scottish Ministers, I think that we should thank them for a job extremely well done. I would pay tribute to the hon. Member for Glasgow, Cathcart (Mr. Taylor), although I fell asleep during one of his contributions in the middle of the night.
  582
  I think the whole House would agree that it has been worth while sitting up all night in order to get the Government to realise that they were on the wrong track as far as clubs were concerned. It was during the debate on the Clayson Committee Report that I first said that I saw no support for the propositions in the report and that I felt that its recommendations were on the wrong track. I am glad that it has been shown that I was wrong and that the support has been extensive.
  As one who opposed Sunday opening, I accept the decision as a democrat, and I hope that it will be a great success. I hope that the licensing authorities will proceed with great caution on extending licences into Sunday and that great attention will be paid to the type of premises which receive them.
  It will be a great shame if the Bill, because of the publicity, becomes known as the Sunday Opening Bill. There are other important provisions in it. The new types of certificate will, I hope, lead to a civilising influence on the drinking habits of Scotland. None of us, whatever our views on the Bill, can be satisfied with the present rate of alcoholism in Scotland or the state of drinking habits. I hope that at the end of the day we shall feel that the Bill is successful. The Ministers deserve to be congratulated.
  9.46 a.m.
  Mr. John P. Mackintosh: I add my voice to the welcome for the Bill as it stands. I agree that there is much more in it than just the question of Sunday opening. It is a comprehensive and forward-looking measure. It has been a long haul since Clayson reported in 1971. It has taken five years—I would say too long—to get this measure on to the statute book. Now that it is there I welcome it.
  I take a different view from the Leader of the Liberal Party about Sunday opening. I voted for it. I was worried when my hon. Friend the Under-Secretary, explaining the fall-back clause, said that it would be used toughly against licensees applying for Sunday licences. I hope that it will be used in exactly the opposite direction—against unsatisfactory premises open during the week—and that we shall not create second-class pubs, open for only six days a week, and first-

  583
  hope that we shall raise the standards of all public houses and have one uniform standard.
  That is not the Bill's sole concern. I am glad that it covers all the other aspects of opening. I too hope that Dr. Clay-son's request for more research into the Bill's effects will be met. We do not want next time around to hear rubbishy arguments about more opening hours leading to more drunkenness and alcoholism. There is a set of causal connections there which are not known. We must know more. We must watch for any defects. Let us hope that this liberalising measure is a success.
  9.48 a.m.
  Mr. Teddy Taylor: Unlike the hon. Member for Berwick and East Lothian (Mr. Mackintosh), I think that the House has made a great mistake by passing a Bill to reform drinking hours in Scotland without making a serious attempt to change the character of drinking premises or to find the root causes of excessive drinking.
  The Leader of the Liberal Party said that the powers in regard to Sunday opening must be used sparingly or with caution. I hope that he has read the schedule which gives the alleged protection. It says that unless the granting of a Sunday licence will lead to undue disturbance or public nuisance the boards must approve Sunday opening. There is no discretion.
  I fear that we have made a major change without the necessary safeguards. I am very disappointed. This is a move in the wrong direction. I do not look upon the Bill as something which will be monitored and which will be changed in a few years if it does not work. All moves to permissiveness or liberalisation since I came to this House have been permanent. There is no way back. What worries me is that these changes have not been successful but have resulted in a crumbling of the moral standards and standards of conduct and much more human misery.
  My greatest hope tonight is that I am totally wrong, that the Bill will be a great success and that we shall achieve civilised drinking. But all the evidence that I have seen and all experience of similar Bills has been exactly the opposite. We have
  584
  made a mistake. We have also lost a great opportunity to have a real reform Bill and not just an extension of pub hours, which is basically all that the Bill is, however it is dressed up.
  Those who have campaigned for licensing reform and have sat here through the night, particularly the hon. Member for Berwick and East Lothian, have run a brilliant campaign. They have done well. I hope that for the sake of Scotland they are right and I am wrong.
  9.51 a.m.
  Mr. Dalyell: As one who did not serve on the Committee, perhaps I am in a good position to acknowledge with gratitude, on behalf of others who were not on the Committee, the work that was done by Members of all parties who served on the Committee. Anybody reading through the massive amount of Committee work must be impressed by the work done not only by the Ministers concerned but by hon. Members on both sides.
  Frankly, I was a bit disconcerted by what was apparently a fairly sudden decision by the Government to change their mind on the issue of police supervision of clubs. Why was that change of mind made?
  The reply may be "You did not vote against it." Frankly, I was so disconcerted that, not being one who is given to instant opposition to my own Government—at any rate, without having had time to reflect on the matter—I did not call out. However, it is legitimate to ask why there was that change of mind. There may have been good reasons for it, but they have not been spelt out. I hope that when my hon. Friend the Minister replies for the last time he will turn his attention to that question.
  9.53 a.m.
  Mr. Monro: As Dr. Clayson is a constituent of mine, I know that this morning he will feel particularly pleased that the Bill—largely based on his recommendations—is now well on its way to the statute book. He will probably feel that all the work that his committee put in over so many years of taking evidence has been well worth while. I feel that the Bill is now in a better shape than when it went into Committee. I welcome most of the changes that were made in Committee and on Report.

  585
  I hope—I am sure that this will be so because of the Scottish Office's interest in the Health Education Unit—that the efforts to reduce alcoholism through publicity and helping the organisations involved with alcoholics and in the research done by the universities and by the Health Education Unit will bear fruition in the years ahead. If we can in any way begin to reduce alcoholism in Scotland, that will be a major step forward. I do not think that anything we have done in the Bill will do other than help towards that end.
  9.54 a.m.
  Mr. Canavan: Much of the publicity given to the Bill outside the House has centred round the proposal for Sunday opening. I voted in favour of Sunday opening and was particularly pleased that that provision was carried.
  The more liberalised laws that will come from the Bill will, hopefully, lead to more civilised and healthier attitudes towards drinking and healthier drinking habits amongst the Scottish people, and will thereby fulfil the hopes of Dr. Clayson and his committee.
  I was particularly pleased at the passing of my amendment regarding late licences for clubs. That provision will be welcomed by many working people throughout the cities, towns and villages of Scotland.
  I should like to express a personal word of thanks to the Under-Secretary of State, my hon. Friend the Member for Stirling, Falkirk and Grangemouth (Mr. Ewing). We had some initial disagreements about police entry to clubs. However, I should like to thank him for his very generous concession and for the pains to which he went to discuss the matter not only with me but with representatives of the clubs in central Scotland at that meeting a few months ago at the Bannockburn Miners' Welfare Club. There was a historic happening at Bannockburn 662 years ago. I think that that meeting with club representatives at Bannockburn will go down as another historic event there, because the passing of this Bill is indeed a historic occasion. The Government do not often accept my advice but I urge them to do it more often, particularly the Treasury.
  9.55 a.m.
  Mr. Harry Ewing: After spending 11 hours on Report, there is a danger that we might accede to my hon. Friend's requests to accept his advice more often. I intervene to resist that possibility.
  I thank hon. Members for their gratitude to those who were responsible for seeing the Bill through. Perhaps I should exclude my hon. Friend the Member for Berwick and East Lothian (Mr. Mackintosh) from my next remark, but we could not have done the work without the co-operation of hon. Members, particularly in Committee. It was one of the best Committees on which I have served and at the time it was the only Committee on which the usual channels were working. It was harmonious.
  I used to describe myself as the "Three Ds Minister"—divorce, devolution and drink. The divorce Bill is on the statute book, the drink Bill is on its way to another place and I should be grateful if hon. Members could give me the hat-trick.
  Question put and agreed to.
  Bill accordingly read the Third time and passed.

ARMED FORCES (SCOTTISH PERSONNEL)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. James Hamilton.]
9.56 a.m.
Mr. Tam Dalyell: Over the week-end, on several separate occasions, people volunteered how much they agreed with me in not wanting an Assembly in Edinburgh—but then added that because they were angry with the failure of the local authority to do X, Y or Z or because they were angy with the Chancellor over cuts in A, B or C they would "give the SNP a try" at the next election.
Well, people in Scotland are at liberty to vote as they think fit—but there is an obligation on some of us, before the next election comes, to spell out, as objectively as possible, what the future of Scots personnel in the British Forces is and what would be the cost, in operational efficiency and millions of pounds increase, of separate Scottish forces.

587
That is why I wrote to Service Ministers in mid-April asking a number of pertinent questions about what would, in reality happen were there separate Scottish forces; why I repeated some of the questions during the defence and Estimates debates; and why this morning I give the opportunity for the Minister of State to reply at greater length than is possible during Service debates to certain questions.
First, if Scottish personnel were hived off from the British Armed Forces what would be the effect on the operational efficiency of NATO? Secondly, would there be sufficient Scottish personnel, with appropriate skills, to establish viable units of Scottish RA Gunners, Scottish RE Sappers, a Scottish Corps of Signals, a Scottish Corps of Transport and the like? Thirdly, what would happen to regiments such as the Royal Scots Dragoon Guards and the Scots Guards where there is a substantial proportion of English-born personnel? Could Englishmen accept mercenary status with Scottish regiments and equally, could Scots, in English units accept mercenary status, if they desired such an option?
Fourthly, do the specialisations of Rosyth cover those needed by a putative self-supporting Scottish navy for the defence of that area of the North Sea that international law might reasonably accord to Scotland? What extra expense would be involved for the English Navy if it were required to protect the Shetland oil fields, if the Vikings in Lerwick implemented their stated intention of remaining with Westminster, and shunning the Edinburgh Government? For what would a Scottish navy have to ask for specialist facilities at Devonport, Portsmouth or Chatham? Those of us who have been to Alverstoke know the expensive speciality involved in deep diving.
Fifthly, supposing a separate Scotland got one-eighth of the Royal Navy, what would be the capability for operating in the North Sea? What would be the difficulties for a Scottish navy in making sure that it had a cross-section of skilled personnel in each specialisation?
Sixthly, do the specialisations available in Scotland cover a self-supporting air force? Could a separate Scottish air force provide the necessary training, maintenance, and servicing without recourse to
588
payment for English facilities, in relation to Nimrod, MRCA, and Rapier?
I am bound to recall that Panavia—to wit, Dr. Madelung at Manching—told us that Holland drew out of the MRCA because she was basically too small a country for a separate MRCA capability. Scotland has about a third of the resources of Holland. What would be the effect on such firms as Ferrantis of Edinburgh and the Cameron iron works of Livingston if an independent Scotland opted out of the MRCA programme? I am glad to see present my hon. Friend the Member for Midlothian (Mr. Eadie), who represents part of Livingston.
Seventhly, what are the existing training costs for a pilot on a sophisticated aircraft, such as Jaguar, and what would be the putative additional costs of training personnel for a separate Scottish air force?
Eighthly, how dependent are the Services on great research centres such os the RRE at Malvern, and what would be the position of Scottish forces if they were denied access to such establishments?
Ninthly, how difficult would it be to disentangle pension rights which have accrued to former and present members of the British Armed Forces, should Scotland become a separate State?
Tenthly, will Ministers regard it as their duty, over the coming months, to lose no opportunity of spelling out to people in Scotland that independence means independence, and that it is no good mincing one's words and supposing that it will all be the same. We could drift into a position which few people in the United Kingdom want.
I have given the Department a great deal of notice that those questions would be asked. Lest anyone should think that they are fanciful, I should like to read a letter dated October 1974 and sent from 22 Kinneddar Street, Lossiemouth, by the then SNP parliamentary candidate for Moray and Nairn, now the Member for that constituency (Mrs. Ewing). She wrote:
"Dear Elector,
RAF and SNP
I am often asked "What happens to the Royal Air Force when Scotland becomes Independent?"
The answer is simple: it continues as the Scottish Royal Air Force and doubtless as

589
English and Welsh Royal Air Forces too. The RAF is in fact the simplest of the Services to apportion as the proportion of RAF Stations in Scotland is much the same as Scotland's share of the population of Britain. The air stations at Kinloss and Lossiemouth among others would continue in operation (the SNP is the only party committed to this) along with its aircraft and equipment.
We need these airfields. We need them to fulfil our commitment to NATO of which we would be a member. Near home we need them because they are a very important factor in the economy of Moray.
And what of the Serviceman who is not Scottish but who wants to go on serving in the RAF in Scotland? He has two choices: He can opt for Scottish citizenship to which he will be entitled by his domicile in Scotland at the time of Independence or we hope that he will be able to serve in the Scottish Royal Air Force in the same way as men from Commonwealth countries such as Canada and Australia do now and will so continue to do. Of course, this depends on agreements being reached with England and Wales and the other Commonwealth nations which would be to the benefit of all.
With Scottish Independence becoming nearer, some non-Scottish servicemen who have bought, or are planning to buy, houses here are asking if they can own houses in Independent Scotland. The answer is a clear yes to owner occupiers of whatever nationality, and servicemen will be entitled to let their houses while on tours of duty abroad.
I know that a great number of you, many not Scottish born, voted for me in February. I thank you most sincerely for your support then. I think you will agree that I have not disappointed you as your MP.
Yours sincerely,
Winifred Ewing."
I read that out to show that what I am saying is not fanciful but is a possibility and should be taken seriously by the Department. I look forward to the answer of my hon. Friend the Minister of State, to whom I am extremely grateful for having stayed up through the night.
10.4 a.m.
The Minister of State for Defence (Mr. William Rodgers): As the only Englishman—perhaps in your presence, Mr. Speaker, I should make clear that I am half a Welshman—to have survived a long Scottish night, may I say first how remarkable is the fortitude of Scots, certainly when they are discussing problems of drink—or no drink, as the case may be—but how glad I am that we have reached this debate at least at a respectable hour on a Wednesday morning.
My hon. Friend the Member for West Lothian (Mr. Dalyell) has asked a number
590
of typically penetrating questions. I appreciate the anxiety behind them. Ten years ago there were very few of us, certainly few like myself who were not close to Scottish affairs, who anticipated the measures of devolution to Scotland that are being discussed today. As a result, there are many Members who remain unhappy about the likely course of events. I was shocked to hear of the letter apparently sent to her electors by the hon. Lady the Member for Moray and Nairn (Mrs. Ewing), which seemed to strike an unusual note of irresponsibility. Until my hon. Friend began to raise this matter, I had not realised that the Scottish National Party had seriously considered the possibility of independent Scottish forces.
May I make it absolutely clear that in the proposals that will be put before the House in the next Session there will be nothing related to separate armed forces for Scotland or to Scottish personnel for the Armed Forces. Separate armed forces imply a separate defence policy, and a separate defence policy implies a separate foreign policy. That would mean the end of the United Kingdom. We should not even have a federal system. Scotland would be independent. There would be a frontier. There would be nationality rules. Scots would be foreigners in England and Englishmen would be foreigners in Scotland. I still like to believe, though my hon. Friend may tell me that I am wrong, that only a lunatic fringe really wants it that way.
Before this morning my hon. Friend had asked for a White Paper and others of my hon. Friends have made similar noises. I previously cast doubt on such an idea, and that it still my position. To me, the proposition of separate armed forces for Scotland remains nonsense. It follows that I feel unable to justify the time that it would take hard-pressed officials in the Defence Department to do all the necessary work to produce a White Paper. On our reduced budget we simply have no resources for such activities.
For the same reason—and I very much hope that my hon. Friend will understand this—I might have difficulty in giving precise replies to my hon. Friend's questions. I entirely agree that they are not fanciful. They ought to be taken seriously, but I do not think I can deal with them seriatim, and I hope he will understand that.

591
As an example, take the number of Scots—or Scottish-born citizens of the United Kingdom—who serve in the Armed Forces. We do not have the figures because we have never counted heads. That is the sort of discrimination that we have previously sought to avoid. What I can say—this goes some way to provide the background for several of my hon. Friend's questions—is that it appears that some 10 per cent. of the United Kingdom Services are recruited in Scotland. With the exception of a number of clearly identified Scottish regiments in the Army, these men and women are scattered throughout the Services with representatives in every branch and specialisation.
The Royal Navy and the Royal Air Force pay little attention to the country of origin, and that is important in view of the hon. Lady's letter. Both Services are organised functionally rather than geographically. The distribution of Scotsmen in the Services is, therefore, largely random.
Even assuming that the full 10 per cent. would wish to join independent Scottish forces—I shall comment on that in a moment—the chance of their representing a well-balanced cross-section of all the various trades, skills and specialisations required today is remote. There could easily be, to take an obvious example, a surplus of pipers and a severe shortage of artillerymen, an excess of engineers and a dearth of pilots for the RAF. To bring their forces into balance, the Scots would therefore be faced with a massive and expensive programme of redundancies, retraining and recruitment with, probably, a return to conscription.
This is no idle threat, because I find it impossible, to say the least, that all those Scots who currently join the Services for the challenging career they still offer would find the attractions of a limited life with the separate Scottish forces sufficiently worth while. It should be noted that among our allies all the smaller nations resort to conscription, not least Norway, which the Scottish National Party appears to regard as an acceptable model. Out of a total full-time service strength of 35,000, the Norwegians maintain some 24,000 conscripts. Therefore, an independent Scotland should expect conscription.
592
My hon. Friend asked about pensions and the problems of disentangling the payments due once independent Scottish forces had been set up. I must confess that this is not a question to which the Government have given a great deal of attention, but I can say that Service records do not differentiate between the constituent parts of the United Kingdom, and the task of separately tracing the pension entitlement of all those Scotsmen serving with the Crown would be prodigious. I only hope that those who advocate the creation of separate armed forces, to be drawn presumably from those serving at present, have recognised the considerable pension liability they would inherit and are prepared to honour it. Otherwise, if I were a Serviceman I would be very worried indeed about my security when I left the Services. I would certainly not vote for a party which threatened to create separate armed forces.
Mr. Dalyell: Hear, hear—absolutely.
Mr. Rodgers: My hon. Friend asked about operational effectiveness. I would not contest that separate Scottish forces could effectively discharge some of the minor roles which the United Kingdom Services undertake at present. But the SNP must come clean in declaring whether or not it intends to play any worthwhile part in the collective security arrangements which have ensured our peace and freedom since the 1940s.
Since the inception of NATO, the British have played a major part in the defence of Western Europe. The Royal Navy remains the major European maritime power declared to NATO, whilst the Britsh Army of the Rhine has a key rôle in safeguarding the central front. Faced with the continuing buildup of the Warsaw Pact conventional forces, the Western Alliance is acutely concerned to obtain better value for money from scarce resources. Consequently, every member of NATO acknowledges the need for greater co-operation. This is evident not only in the increasing number of collaborative equipment projects but also in the renewed pressure from NATO commanders for more effective integration of military doctrine and procedures. The break-up of the British contribution to

593
NATO would be a direct reversal of this trend and a most damaging blow to the Alliance. Quite apart from the initial disruption that would ensue, the separate forces eventually emerging would undoubtedly be more costly and less effective than those we have now.
My hon. Friend also raised the question of support for the Services. It is naïve to imagine that the Forces of the Crown can in some way be divided up and that Scottish forces can be set up by simply taking over those units at present located there. The Services are immensely complex organisations, and the growth of modern military technology has resulted in extensive administrative and logistics tails performing the vital functions of support, maintenance and training, without which the front line would soon collapse. It is not enough today to raise the Highland levies and send them into battle. Indeed, from the calculations we have done it appears that all the Scotsmen currently in the British Army could not man the Scottish regiments effectively for lack of the necessary support and logistics back-up. A whole network of research and development establishments, defence contractors, ordnance depots, workshops and training schools is required before a soldier can perform the duties for which he is trained.
In the case of the Army, there are few facilities of that kind in Scotland. There are no central workshops in Scotland, no arms schools, no central ordnance depots, no central vehicle depots and only limited facilities for basic infantry training and running repair of vehicles. There is not sufficient barrack accommodation for all the Scottish units in the British Army, and only one Royal ordnance factory.
For the high-technology Services, the Royal Navy and the Royal Air Force, indigenous Scottish facilities are even more limited. Those facilities located in Scotland are highly specialised and not easily converted to other tasks. For example, the naval dockyard at Rosyth concentrates on refitting the Polaris submarines, which I understand the nationalists are determined to evict from Scottish waters, and also the expensive nuclear-powered hunter-killer submarines which could play little or no part in a separate Scottish navy. Likewise, the
594
Naval Construction Research Establishment at Dunfermline specialises in advanced naval work with particular emphasis on submarine construction. The RAF stations at Lossiemouth, Leuchars and Kinloss provide servicing for Nimrods, Shackletons and Rapier missiles. But there are no major RAF maintenance units in Scotland, nor any front-line training facilities, with the exception of the Jaguar operational conversion unit at Lossiemouth. None of the front-line aircraft operated by the RAF is manufactured in Scotland. Consequently there is no industrial repair capacity available either.
My hon. Friend mentioned the cost of training. We estimate the cost of training a pilot for a modern, sophisticated military aircraft to be up to £500,000. On all our evidence, the cost would be a great deal larger if the training for Scotland was clone separately in Scotland.
In summary, I see a number of grave disadvantages in any move, however hypothetical, to establish separate Scottish armed forces independent of the remainder of the United Kingdom. First, recruiting to these forces would not be easy. Secondly, the arbitrary division of the present Forces of the Crown into those who happen to be Scots and those who do not would undoubtedly result in a Scottish rump which would amount to no more than scratch Services, unbalanced in trades, skills and specialisation.
Thirdly, separate Scottish forces would face a serious lack of training and support facilities. Some extensive facilities located in Scotland would be left lying idle. Some establishments might even have to close, with obvious employment consequences. Elsewhere, considerable capital expenditure would be required in providing the necessary infrastructure for the Services to perform essential tasks which are currently undertaken south of the border. This would be an immensely costly process.
Fourthly, the industrial consequences would be similar. The loss of Royal Naval orders to the shipbuilding yards of Yarrow and Scott-Lithgow would be a serious blow, and I cannot see that such plans as there are for a separate Scottish navy would do much to fill the gap. We must also remember that there are no manufacturers capable of

595
designing and building sophisticated military aircraft in Scotland at present, nor are there many firms manufacturing Army weapons or equipment. Separate forces would consequently mean a massive import bill for military equipment, which would add to the other costs of going it alone.
Fifthly, there can be no doubt that separate forces could only downgrade the current contribution which the United Kingdom makes to NATO. With the best will in the world, an independent Scottish contingent, either fighting alongside the remaining British forces or occupying some different segment of the front, at 10 per cent. or less of our current united strength, would have a minor impact not only in military but also in political terms. The break-up of the current United Kingdom forces could only damage the overall credibility of NATO.
It is fair to ask those who advocate this to say whether they want to damage NATO or whether they regard this as an unimportant factor. Are they concerned with symbols or with the realities of the proper security of the Scottish people?10.4 a.m.
It is difficult to assess the financial implications of the proposals we are now discussing as they have not been formulated with any precision. It is for others who want to see separation to produce a properly-worked-out White Paper. Nevertheless, I have seen some reports which suggest a figure of £350 million for a Scottish defence budget, or about 4·5 per cent. of probable Scottish gross national product. This is considerably less than 10 per cent. of the United Kingdom defence budget and would clearly sustain forces of only marginal military capability. Norway, for example, with a population of over 1 mil-
596
lion less than Scotland, spends more than £450 million on defence at current exchange rates. From such calculations as we have been able to do, it is clear that a more realistic budget for separate Scottish forces—if they are to be something more than a combined coastguard and gendarmerie—would be at least £500 million, exclusive of the extra initial costs of transition and disruption—and I repeat that the initial costs of separation would be very high. This would be 6½ per cent. of Scottish GNP compared with the current figure of 5½ per cent. for the United Kingdom as a whole and it would still be a smaller expenditure per head than that of Norway, which appears to be the model.
I conclude that a breakaway movement by the Scots would leave them with limited forces, poorly organised and recruited, lacking sophisticated equipment in any one arm, suffering from a critical lack of support, training and maintenance facilities and ineffective for defending Scotland—all at considerably greater cost than at present. It would be a sad moment for the Scottish people and a black day for us all.
Mr. Dalyell: Does my right hon. Friend agree that the reference in the letter of the hon. Member for Moray and Nairn (Mrs. Ewing) to a Welsh Royal Air Force is equally absurd?10.4 a.m.
Mr. Rodgers: I regarded the letter to which my hon. Friend refers as remarkably absurd. If there were such ridiculous proposals for Wales—I do not believe that there are, and I should not expect them—the greater part of what I have said would apply.
Question put and agreed to.
Adjourned accordingly at twenty-one minutes past Ten o'clock a.m.

AIRCRAFT AND SHIPBUILDING INDUSTRIES BILL
Division List No. 282 [See col. 306]

Division No. 282.]

AYES

6.00 p.m.

Abse, Leo

Ellis, Tom (Wrexham)

Lomas, Kenneth

Allaun, Frank

English, Michael

Loyden, Eddie

Anderson, Donald

Ennals, David

Luard, Evan

Archer, Peter

Evans, Fred (Caerphilly)

Lyons, Edward (BBradford W)

Armstrong, Ernest

Evans, John (Newton)

Mabon, Dr J. Dickson

Ashley, Jack

Ewing, Harry (Stirling)

McCartney, Hugh

Ashton, Joe

Faulds, Andrew

McDonald, Dr Oonagh

Atkins, Ronald (Preston N)

Fernyhough, Rt Hon E.

MacFarquhar, Roderick

Atkinson, Norman

Fitch, Alan (Wigan)

McGuire, Michael (Ince)

Bagier, Gordon A. T.

Fitt, Gerard (Belfast W)

MacKenzie, Gregor

Barnett, Guy (Greenwich)

Flannery, Martin

Mackintosh, John P.

Barnelt, Rt Hon Joel (Heywood)

Fletcher, L. R. (Ilkeston)

Maclennan, Robert

Bates, Alt

Fletcher, Ted (Darlington)

McMillan, Tom (Glasgow C)

Bean, R. E.

Foot, Rt Hon Michael

Madden, Max

Benn, Rt Hon Anthony Wedgwood

Ford, Ben

Magee, Bryan

Bennett, Andrew (Stockport N)

Forrester, John

Mahon, Simon

Bidwell, Sydney

Fowler, Gerald (The Wrekin)

Mallalieu, J. P. W.

Bishop, E. S.

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

Marks, Kenneth

Blenkinsop, Arthur

Freeson, Reginald

Marquand, David

Boardman, H.

Garrett, John (Norwich S)

Marshall, Dr Edmund (Goole)

Booth, Rt Hon Albert

Garrett, W. E. (Wallsend)

Marshall, Jim (Leicester S)

Boothroyd, Miss Betty

George, Bruce

Mason, Rt Hon Roy

Bottomley, Rt Hon Arthur

Gilbert, Dr John

Maynard, Miss Joan

Boyden, James (Bish Auck)

Ginsburg, David

Meacher, Michael

Bradley, Tom

Golding, John

Mellish, Rt Hon Robert

Bray, Dr Jeremy

Gould, Bryan

Mendelson, John

Broughtort, Sir Alfred

Gourlay, Harry

Mikardo, Ian

Brown, Hugh D. (Provan)

Grant, George (Morpeth)

Millan, Bruce

Brown, Robert C. (Newcastle W)

Grant, John (Islington C)

Miller, Dr M. S. (E Kilbride)

Brown, Ronald (Hackney S)

Grocott, Bruce

Miller, Mrs Millie (llford N)

Buchan, Norman

Hamilton, James (Bothwell)

Mitchell, R. C. (Soton, Itchen)

Buchanan, Richard

Hamilton, W. W. (Central Fife)

Moonman, Eric

Butler, Mrs Joyce (Wood Green)

Hardy, Peter

Morris, Alfred (Wythenshawe)

Callaghan, Jim (Middleton & P)

Harper, Joseph

Morris, Charles R. (Openshaw)

Campbell, Ian

Harrison, Walter (Wakefield)

Morris, Rt Hon J. (Aberavon)

Canavan, Dennis

Hart, Rt Hon Judith

Moyle, Roland

Cant, R. B.

Hatton, Frank

Mulley, Rt Hon Frederick

Carmichael, Neil

Hayman, Mrs Helene

Murray, Rt Hon Ronald King

Carter, Ray

Heifer, Eric S.

Newens, Stanley

Cartwright, John

Hooley, Frank

Noble, Mike

Castle, Rt Hon Barbara

Horam, John

Oakes, Gordon

Clemitson, Ivor

Howell, Rt Hon Denis (B'ham, Sm H)

Ogden, Eric

Cocks, Michael (Bristol S)

Hoyle, Doug (Nelson)

O'Halloran, Michael

Cohen, Stanley

Huckfield, Les

Orbach, Maurice

Coleman, Donald

Hughes, Rt Hon C. (Anglesey)

Orme, Rt Hon Stanley

Colquhoun, Ms Maureen

Hughes, Mark (Durham)

Ovenden, John

Conlan, Bernard

Hughes, Robert (Aberdeen N)

Owen, Or David

Cook, Robin F. (Edin C)

Hughes, Roy (Newport)

Padley, Walter

Corbett, Robin

Hunter, Adam

Palmer, Arthur

Cox, Thomas (Tooting)

Irvine, Rt Hon Sir A. (Edge Hill)

Park, George

Craigen, J. M. (Maryhill)

Irving, Rt Hon S. (Dartford)

Parker, John

Crawshaw, Richard

Jackson, Colin (Brighouse)

Parry, Robert

Cronin, John

Jackson, Miss Margaret (Lincoln)

Pavitt, Laurie

Crosland, Rt Hon Anthony

Janner, Greville

Peart, Rt Hon Fred

Crowther, Stan (Rotherham)

Jay, Rt Hon Douglas

Pendry, Tom

Cryer, Bob

Jenkins, Hugh (Putney)

Perry, Ernest

Cunningham, G. (Islington S)

Jenkins, Rt Hon Roy (Stechford)

Phipps, Dr Colin

Cunningham, Dr J. (Whiten)

John, Brynmor

Prentice, Rt Hon Reg

Dalyell, Tam

Johnson, James (Hull West)

Prescott, John

Davidson, Arthur

Johnson, Walter (Derby S)

Price, C (Lewisham W)

Davies, Bryan (Enfield N)

Jones, Barry (East Flint)

Price, William (Rugby)

Davis, Denzil (Llanelli)

Jones, Dan (Burnley)

Radice, Giles

Davies, Ifor (Gower)

Judd, Frank

Rees, Rt Hon Merlyn (Leeds S)

Davis, Clinton (Hackney C)

Kaufman, Gerald

Richardson, Miss Jo

Deakins, Eric

Kelley, Richard

Roberts, Albert (Normanton)

Dean, Joseph (Leeds West)

Kerr, Russell

Roberts, Gwllym (Cannock)

de Freltas, Rt Hon Sir Geoffrey

Kilroy-Sllk, Robert

Robinson, Geoffrey

Dell, Rt Hon Edmund

Kinnock, Neil

Roderick, Caerwyn

Dempsey, James

Lambie, David

Rodgers, George (Chorley)

Doig, Peter

Lamborn, Harry

Rodgers, William (Stockton)

Dormand, J. D.

Lamond, James

Rooker, J. W.

Douglas-Mann, Bruce

Latham, Arthur (Paddington)

Roper, John

Duffy, A. E. P.

Leadbitter, Ted

Rose, Paul B.

Dunn, James A.

Lee, John

Ross, Rt Hon W. (Kilmarnock)

Dunnett, Jack

Lestor, Miss Joan (Eton & Slough)

Rowlands, Ted

Dunwoody, Mrs Gwyneth

Lever, Rt Hon Harold

Sandelson, Neville

Eadie, Alex

Lewis, Arthur (Newham, N)

Sedgemore, Brian

Edge, Geoff

Lewis, Ron (Carlisle)

Selby, Harry

Edwards, Robert (Wolv SE)

Lipton, Marcus

Shaw, Arnold (llford South)

Ellis, John (Brigg & Seun)

Litterick, Tom

Sheldon, Robert (Ashton-u-Lyne)

Shore, Rt Hon Peter

Thomas, Mike (Newcastle E)

White, James (Pollok)

Short, Rt Hon E. (Newcastle C)

Thomas, Ron (Bristol NW)

Whitehead, Phillip

Short, Mrs Renée (Wolv NE)

Thorne, Stan (Preston South)

Whitlock, William

Silkin, Rt Hon John (Depttord)

Tierney, Sydney

Willey, Rt Hon Frederick

Silkin, Rt Hon S. C. (Dulwich)

Tinn, James

Williams, Alan (Swansea W)

Sillars, James

Tomlinson, John

Williams, Alan Lee (Hornch'ch)

Silverman, Julius

Tomney, Frank

Williams, Rt Hon Shirley (Hertford)

Skinner, Dennis

Torney, Tom

Williams, Sir Thomas

Small, William

Tuck, Raphael

Wilson, Alexander (Hamilton)

Smith, John (N Lanarkshire)

Urwin, T. W.

Wilson, Rt Hon Sir Harold (Huyton)

Snape, Peter

Varley, Rt Hon Eric G.

Wilson, William (Coventry SE)

Spearing, Nigel

Wainwright, Edwin (Dearne V)

Wise, Mrs Audrey

Spriggs, Leslie

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

Woodall, Alec

Stewart, Rt Hon M. (Fulham)

Walker, Harold (Doncaster)

Woof, Robert

Stoddart, David

Walker, Terry (Kingswood)

Wrigglesworth, Ian

Stott, Roger

Ward, Michael

Young, David (Bolton E)

Strang, Gavin

Watkins, David

Strauss, Rt Hon G. R.

Watkinson, John

TELLERS FOR THE AYES:

Summerskill, Hon Dr Shirley

Weetch, Ken

Mr. Ted Graham and

Swain, Thomas

Weltzman, David

Mr. A. W. Stallard

Taylor, Mrs Ann (Bolton W)

Wellbeloved, James

Thomas, Jeffrey (Abertillery)

White, Frank R. (Bury)

NOES

Adley, Robert

Eden, Rt Hon Sir John

Hurd, Douglas

Alison, Michael

Edwards, Nicholas (Pembroke)

Hutchison, Michael Clark

Arnold, Tom

Emery, Peter

Irving, Charles (Cheltenham)

Atkins, Rt Hon H. (Spelthorne)

Evans, Gwynfor (Carmarthen)

James, David

Awdry, Daniel

Eyre, Reginald

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

Bain, Mrs Margaret

Fairbairn, Nicholas

Jessel, Toby

Baker, Kenneth

Fairgrieve, Russell

Johnson Smith, G. (E Grinstead)

Banks, Robert

Fair, John

Johnston, Russell (Inverness)

Beith, A. J.

Fell, Anthony

Jones, Arthur (Daventry)

Bell, Ronald

Finsberg, Geoffrey

Jopling, Michael

Bennett, Sir Frederic (Torbay)

Fletcher, Alex (Edinburgh N)

Joseph, Rt Hon Sir Keith

Bennett, Dr Reginald (Fareham)

Forman, Nigel

Kellett-Bowman, Mrs Elaine

Benyon, W.

Fowler, Norman (Sutton C'f'd)

Kershaw, Anthony

Berry, Hon Anthony

Fox, Marcus

Kilfedder, James

Biffen, John

Fraser, Rt Hon H. (Stafford & St)

Kimball, Marcus

Biggs-Davison, John

Freud, Clement

King, Evelyn (South Dorset)

Blaker, Peter

Fry, Peter

King, Tom (Bridgwater)

Body, Richard

Galbraith, Hon T. G. D.

Kirk, Sir Peter

Boscawen, Hon Robert

Gardiner, George (Reigate)

Kitson, Sir Timothy

Bottomley, Peter

Gardner, Edward (S Fylde)

Knight, Mrs Jill

Bowden, A. (Brighton, Kemptown)

Gilmour, Rt Hon Ian (Chesham)

Knox, David

Boyson, Dr Rhodes (Brent)

Gilmour, Sir John (East Fife)

Lament, Norman

Bradford, Rev Robert

Glyn, Dr Alan

Lane, David

Brittan, Leon

Godber, Rt Hon Joseph

Langford-Holt, Sir John

Brotherton, Michael

Goodhart, Philip

Latham, Michael (Melton)

Brown, Sir Edward (Bath)

Goodhew, Victor

Lawrence, Ivan

Bryan, Sir Paul

Goodlad, Alastair

Lawson, Nigel

Buchanan-Smith, Alick

Gorst, John

Le Marchant, Spencer

Buck, Antony

Gow, Ian (Eastbourne)

Lewis, Kenneth (Rutland)

Budgen, Nick

Gower, Sir Raymond (Barry)

Lloyd, Ian

Bulmer, Esmond

Grant, Anthony (Harrow C)

Loverldge, John

Burden, F. A.

Gray, Hamish

Luce, Richard

Butler, Adam (Bosworth)

Griffiths, Eldon

MacCormick, lain

Carlisle, Mark

Grimond, Rt Hon J.

McCrindle, Robert

Chalker, Mrs Lynda

Grist, Ian

Macfarlane, Neil

Channon, Paul

Grylls, Michael

MacGregor, John

Churchill, W. S.

Hall, Sir John

Macmillan, Rt Hon M. (Farnham)

Clark, Alan (Plymouth, Sutton)

Hall-Davis, A. G. F.

McNair-Wilson, M. (Newbury)

Clark, William (Croydon S)

Hamilton, Michael (Salisbury)

McNair-Wilson, P. (New Forest)

Clarke, Kenneth (Rushclitfe)

Hampson, Dr Keith

Madel, David

Clegg, Walter

Hannam,John

Marshall, Michael (Arundel)

Cockcroft, John

Harrison, Col Sir Harwood (Eye)

Marten, Neil

Cooke, Robert (Bristol W)

Harvie Anderson, Rt Hon Mies

Mates, Michael

Cope, John

Hastings, Stephen

Mather, Carol

Cordle, John H.

Havers, Sir Michael

Maude, Angus

Cormack, Patrick

Hawkins, Paul

Maudling, Rt Hon Reginald

Costain, A. P.

Hayhoe, Barney

Mawby, Ray

Craig, Rt Hon W. (Belfast E)

Heath, Rt Hon Edward

Maxwell-Hyslop, Robin

Crawford, Douglas

Henderson, Douglas

Mayhew, Patrick

Critchley, Julian

Heselline, Michael

Meyer, Sir Anthony

Crouch, David

Hicks, Robert

Miller, Hal (Bromsgrove)

Crowder, F. P.

Higgins, Terence L.

Mills, Peter

Davies, Rt Hon J, (Knutsford)

Holland, Philip

Mlscampbell, Norman

Dean, Paul (N Somerset)

Hooson, Emlyn

Mitchell, David (Basingstoke)

Dodsworth, Geoffrey

Hordern, Peter

Moate, Roger

Douglas-Hamilton, Lord James

Howe, Rt Hon Sir Geoffrey

Molyneaux, James

Drayson, Burneby

Howell, David (Guildford)

Monro, Hector

du Cann, Rt Hon Edward

Howell, Ralph (North Norflok)

Montgomery, Fergus

Durant, Tony

Hunt, David (Wirral)

Moore, John (Croydon C)

Dykes, Hugh

Hunt, John (Bromley)

More, Jasper (Ludlow)

Morgan, Geraint

Ridsdale, Julian

Stradling Thomas, J,

Morgan-Giles, Rear-Admiral

Rilkind, Malcolm

Tapsell, Peter

Morris, Michael (Northampton S)

Roberts, Michael (Cardiff NW)

Taylor, R. (Croydon NW)

Morrison, Charles (Devizes)

Roberts, Wyn (Conway)

Taylor, Teddy (Cathcart)

Morrison, Hon Peter (Chester)

Rodgers, Sir John (Sevenoaks)

Tebbit, Norman

Mudd, David

Ross, Stephen (Isle of Wight)

Temple-Morris, Peter

Neave, Airey

Ross, William (Londonderry)

Thatcher, Rt Hon Margaret

Nelson, Anthony

Rossi, Hugh (Hornsey)

Thomas, Dafydd (Merioneth)

Neubert, Michael

Rost, Peter (SE Derbyshire)

Thomas, Rt Hon P. (Hendon S)

Newton, Tony

Royle, Sir Anthony

Thompson, George

Normanton, Tom

Sainsbury, Tim

Thorpe, Rt Hon Jeremy (N Devon)

Nott, John

Scott, Nicholas

Townsend, Cyril D.

Onslow, Cranley

Scott-Hopkins, James

Trotter, Neville

Oppenheim, Mrs Sally

Shaw, Giles (Pudsey)

Tugendhat, Christopher

Osborn, John

Shaw, Michael (Scarborough)

van Straubenzee, W. R.

Page, John (Harrow West)

Shelton, William (Streatham)

Vaughan, Dr Gerard

Page, Rt Hon R. Graham (Crosby)

Shepherd, Colin

Viggers, Peter

Paisley, Rev Ian

Shersby, Michael

Wainwright, Richard (Colne V)

Parkinson, Cecil

Silvester, Fred

Wakenham, John

Penhaligon, David

Sims, Roger

Walker-Smith, Rt Hon Sir Derek

Percival, Ian

Sinclair, Sir George

Wall, Patrick

Peyton, Rt Hon John

Skeet, T. H. H.

Walters, Dennis

Pink, R. Bonner

Smith, Cyril (Rochdale)

Warren, Kenneth

Powell, Rt Hon J. Enoch

Smith, Dudley (Warwick)

Weatherill, Bernard

Price, David (Eastleigh)

Speed, Keith

Wells, John

Prior, Rt Hon James

Spence, John

Whitelaw, Rt Hon William

Pym, Rt Hon Francis

Spicer, Jim (W Dorset)

Wiggin, Jerry

Raison, Timothy

Spicer, Michael (S Worcester)

Wigley, Dafydd

Rathbone, Tim

Sproat, Iain

Wilson, Gordon (Dundee E)

Rawlinson, Rt Hon Sir Peter

Stainton, Keith

Winterton, Nicholas

Rees, Peter (Dover & Deal)

Stanbrook, Ivor

Wood, Rt Hon Richard

Rees-Davles, W. R.

Stanley, John

Young, Sir G. (Ealing, Acton)

Reid, George

Steel, David (Roxburgh)

Younger, Hon George

Renton, Rt Hon Sir D. (Hunts)

Steen, Anthony (Wavertree)

Renton, Tim (Mid-Sussex)

Stewart, Donald (Western Isles)

TELLERS FOR THE NOES:

Rhys Williams, Sir Brandon

Stewart, Ian (Hitchin)

Mr. Jim Lester and

Ridley, Hon Nicholas

Stokes, John

Mr. John Corrie

Division List No. 283 [See col. 341]

Division No. 283.]

AYES

[7.59 p.m.

Adley, Robert

Cooke, Robert (Bristol W)

Goodlad, Alastair

Aitken, Jonathan

Cope, John

Gorst, John

Alison, Michael

Cordle, John H.

Gow, Ian (Eastbourne)

Amery, Rt Hon Julian

Cormack, Patrick

Gower, Sir Raymond (Barry)

Arnold, Tom

Costain, A. P.

Grant, Anthony (Harrow C)

Atkins, Rt Hon H. (Spelthorne)

Craig, Rt Hon W. (Belfast E)

Gray, Hamish

Awdry, Daniel

Crawford, Douglas

Griffiths, Eldon

Bain, Mrs Margaret

Critchley, Julian

Grimond, Rt Hon J-

Baker, Kenneth

Crouch, David

Grist, Ian

Banks, Robert

Crowder, F. P.

Grylls, Michael

Beith, A. J.

Davies, Rt Hon J. (Knutsford)

Hall, Sir John

Bell, Ronald

Dean, Paul (N Somerset)

Hall-Davis, A. 0. F.

Bennett, Sir Frederic (Torbay)

Dodsworth, Geoffrey

Hamilton, Michael (Salisbury)

Bennett, Dr Reginald (Fareham)

Douglas-Hamilton, Lord James

Hampson, Dr Keith

Benyon, W.

Drayson, Burnaby

Hannam, John

Berry, Hon Anthony

du Cann. Rt Hon Edward

Harrison, Col Sir Harwood (Eye)

Bitten, John

Durant, Tony

Harvie Anderson, Rt Hon Miss

Biggs-Davison, John

Dykes, Hugh

Hastings, Stephen

Blaker, Peter

Eden, Rt Hon Sir John

Havers, Sir Michael

Body, Richard

Edwards, Nicholas (Pembroke)

Hawkins, Paul

Boscawen, Hon Robert

Elliott, Sir William

Hayhoe, Barney

Bottomley, Peter

Emery, Peter

Heath, Rt Hon Edward

Bowden, A. (Brighton, Kemptown)

Ewing, Mrs Winifred (Moray)

Henderson, Douglas

Boyson, Dr Rhodes (Brent)

Eyre, Reginald

Heseltine, Michael

Bradford, Rev Robert

Fairbairn, Nicholas

Hicks, Robert

Brittan, Leon

Fairgrieve, Russell

Higgins, Terence L.

Brotherton, Michael

Farr, John

Holland, Philip

Brown, Sir Edward (Bath)

Fell, Anthony

Hooson, Emlyn

Bryan, Sir Paul

Finsberg, Geoffrey

Hordern, Peter

Buchanan-Smith, Alick

Fletcher, Alex (Edinburgh N)

Howe, Rt Hon Sir Geoffrey

Buck, Antony

Forman, Nigel

Howell, David (Guildford)

Budgen, Nick

Fowler, Norman (Sutton C'f'd)

Howell, Ralph (North Norfolk)

Bulmer, Esmond

Fox, Marcus

Howells, Geraint (Cardigan)

Burden, F. A.

Fraser, Rt Hon H. (Stafford & St)

Hunt, David (Wirral)

Butler, Adam (Bosworth)

Freud, Clement

Hunt, John (Bromley)

Carlisle, Mark

Fry, Peter

Hurd, Douglas

Carson, John

Galbraith, Hon T. G. D.

Hutchison, Michael Clark

Chalker, Mrs Lynda

Gardiner, George (Reigate)

Irving, Charles (Cheltenham)

Channon, Paul

Gardner, Edward (S Fylde)

James, David

Churchill, W. S.

Gilmour, Rt Hon Ian (Chesham)

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

Clark, Alan (Plymouth, Sutton)

Gilmour, Sir John (East Fife)

Jesse1, Toby

Clark, William (Croydon S)

Glyn, Dr Alan

Johnson Smith, G. (E Grinstead)

Clarke, Kenneth (Rushcliffe)

Godber, Rt Hon Joseph

Johnston, Russell (Inverness)

Clegg, Walter

Goodhart, Philip

Jones, Arthur (Daventry)

Cockcroft, John

Goodhew, Victor

Jopling, Michael

Joseph, Rt Hon Sir Keith

Mudd, David

Smith, Cyril (Rochdale)

Kabetry, Sir Donald

Neave, Airey

Smith, Dudley (Warwick)

Kellett-Bowman, Mrs Elaine

Nelson, Anthony

Speed, Keith

Kershaw, Anthony

Neubert, Michael

Spence, John

Kilfedder, James

Newton, Tony

Spicer, Jim (W Dorset)

Kimball, Marcus

Normanton, Tom

Spicer, Michael (S Worcester)

King, Evelyn (South Dorset)

Nott, John

Sproat, Iain

King, Tom (Bridgwater)

Onslow, Cranley

Stainton, Keith

Kirk, Sir Peter

Oppenheim, Mrs Sally

Stanbrook, Ivor

Kitson, Sir Timothy

Osborn, John

Stanley, John

Knight, Mrs Jill

Page, John (Harrow West)

Steel, David (Roxburgn)

Knox, David

Page, Rt Hon R. Graham (Crosby)

Steen, Anthony (Wavertree)

Lamont, Norman

Paisley, Rev Ian

Stewart, Donald (Western Isles)

Lane, David

Parkinson, Cecil

Stewart, Ian (Hitchin)

Langford-Holt, Sir John

Penhaligon, David

Stokes, John

Latham, Michael (Melton)

Percival, Ian

Stradling Thomas, J.

Lawrence, Ivan

Peyton, Rt Hon John

Tapsell, Peter

Lawson, Nigel

Pink, R. Bonner

Taylor, R. (Croydon NW)

Le Marchant, Spencer

Powell, Rt Hon J. Enoch

Taylor, Teddy (Cathcart)

Lester, Jim (Beeston)

Price, David (Eastleigh)

Tebbit, Norman

Lewis, Kenneth (Rutland)

Prior, Rt Hon James

Temple-Morris, Peter

Lloyd, Ian

Pym, Rt Hon Francis

Thatcher, Rt Hon Margaret

Loveridge, John

Raison, Timothy

Thomas, Rt Hon P. (Hendon S)

Luce, Richard

Rathbone, Tim

Thompson, George

MacCormick, lain

Rawlinson, Rt Hon Sir Peter

Townsend, Cyril D.

McCrindle, Robert

Rees, Peter (Dover & Deal)

Trotter, Neville

Macfarlane, Neil

Rees-Davies, W. R.

Tugendhat, Christopher

MacGregor, John

Reid, George

van Straubenzee W. R.

Macmilian, Rt Hon M. (Farnham)

Renton, Rt Hon Sir D. (Hunts)

Vaughan, Dr Gerard

McNair-Wilson, M. (Newbury)

Renton, Tim (Mid-Sussex)

Viggers, Peter

McNair-Wilson, P. (New Forest)

Rhys Williams, Sir Brandon

Wainwright, Richard (Colne V)

Madel, David

Ridley, Hon Nicholas

Marshall. Michael (Arundel)

Ridsdale, Julian

Wakeham, John

Marten, Neil

Rifkind, Malcolm

Walder,David (clitheroe)

Mates, Michael

Roberts, Michael (Cardiff NW)

Walker, Rt Hon p. (Worcester)

Maude, Angus

Roberts, Wyn (Conway)

Wall Patrick

Maudling, Rt Hon Reginald

Rodgers, Sir John (Sevenoaks)

Mawby, Ray

Ross, Stephen (Isle of Wight)

Walters, Dennis

Maxwell-Hyslop, Robin

Ross, William (Londonderry)

Warren, Kenneth

Mayhew, Patrick

Rossi, Hugh (Hornsey)

Watt, Hamish

Meyer, Sir Anthony

Rost, Peter (SE Derbyshire)

Weatherill, Bernard

Miller, Hal (Bromsgrove)

Royle, Sir Anthony

Wells, John

Mills, Peter

Sainsbury, Tim

Welsh, Andrew

Miscampbell, Norman

St. John-Stevas, Norman

Whitelaw, Rt Hon William

Mitchell, David (Basingstoke)

Scott, Nicholas

Wiggin, Jerry

Moate, Roger

Scott-Hopkins, James

Wilson, Gordon (Dundee E)

Molyneaux, James

Shaw, Giles (Pudsey)

Winterton, Nicholas

Monro, Hector

Shaw, Michael (Scarborough)

Wood, Rt Hon Richard

Montgomery, Fergus

Shelton, William (Streatham)

Young, Sir G. (Ealing, Acton)

Moore, John (Croydon C)

Shepherd, Colin

Younger, Hon George

More, Jasper (Ludlow)

Shersby, Michael

Morgan, Geraint

Silvester, Fred

TELLERS FOR THE AYES:

Morgan-Giles, Rear-Admiral

Sims, Roger

Mr. John Corrie and

Morris, Michael (Northampton S)

Sinclair, Sir Roger

Mr. Carol Mather.

Morrison, Charles (Devizes)

Skeet, T. H. H.

NOES

Allaun, Frank

Brown, Ronald (Hackney S)

Cryer, Bob

Anderson, Donald

Buchan, Norman

Cunningham, G. (Islington S)

Archer, Peter

Buchanan, Richard

Cunningham, Dr J. (Whiteh)

Armstrong, Ernest

Butler, Mrs Joyce (Wood Green)

Dalyell, Tarn

Ashley, Jack

Callaghan, Rt Hon J. (Cardiff SE)

Davidson, Arthur

Ashton, Joe

Callaghan, Jim (Middleton & P)

Davies, Bryan (Enfield N)

Atkins, Ronald (Preston N)

Campbell, Ian

Davis, Denzil (Llanelli)

Atkinson, Norman

Canavan, Dennis

Davies, Ifor (Gower)

Bagier, Gordon A. T.

Cant, R. B.

Davis, Clinton (Hackney C)

Barnett, Guy (Greenwich)

Carmichael, Neil

Deakins, Eric

Barnett, Rt Hon Joel (Heywood)

Carter, Ray

Dean, Joseph (Leeds Vest)

Bean, R. E.

Cartwright, John

de Freitas, Rt Hon Sir Geoffrey

Benn, Rt Hon Anthony Wedgwood

Castle, Rt Hon Barbara

Dell, Rt Hon Edmund

Bennett, Andrew (Stockport N)

Clemitson, Ivor

Dempsey, James

Bidwell, Sydney

Cocks, Michael (Bristol S)

Doig, Peter

Bishop, E. S.

Cohen, Stanley

Dormand, J. D.

Blenkinsop, Arthur

Coleman, Donald

Douglas-Mann, Bruce

Boardman, H.

Colquhoun, Ms Maureen

Duffy, A. E. P.

Booth, Rt Hon Albert

Conlan, Bernard

Dunn, James A.

Boothroyd, Miss Betty

Cook, Robin F. (Edin C)

Dunnett, Jack

Bottomley, Rt Hon Arthur

Corbett, Robin

Dunwoody, Mrs Gwyneth

Boyden, James (Bish Auck)

Cox, Thomas (Tooting)

Eadle, Alex

Bradley, Tom

Craigen, J. M. (Maryhill)

Edge, Geoff

Bray, Dr Jeremy

Crawshaw, Richard

Edwards, Robert (Wolv SE)

Broughton, Sir Alfred

Cronin, John

Ellis, John (Brigg & Scun)

Brown, Hugh D. (Provan)

Crosland, Rt Hon Anthony

Ellis, Tom (Wrexham)

Brown, Robert C. (Newcastle W)

Crowther, Stan (Rotherham)

English, Michael

Ennals, David

Lestor, Miss Joan (Eton & Slough)

Rooker, J.W.

Evans, Fred (Caerphilly)

Lever, Rt Hon Harold

Rooker, J.W.

Evana, Gwynfor (Carmarthen)

Lewis, Arthur (Newham, N)

Roper, John Rose Paul B.

Evans, loan (Aberdare)

Lewis, Ron (Carlisle)

Rose Rt Hon W. (Kilmarnock)

Evans, John (Newton)

Lipton, Marcus

Rowlands, Ted

Ewing, Harry (Stirling)

Litterick, Tom

Sandelson, Neville

Faulds, Andrew

Lomas, Kenneth

Sedgemore,Brian

Fernyhough, Rt Hon E.

Loyden, Eddie

Selby Harry

Fitch, Alan (Wigan)

Luard, Evan

Shaw, Arnold (llford South)

Fitt, Gerard (Belfast W)

Lyons, Edward (Bradford W)

Sheldon,Robert (Ashton-u-Lyne)

Flannery, Martin

Mabon, Dr J. Dickson

Shore, Rt Hon Peter

Fletcher, L. R. (Ilkeston)

McCartney, Hugh

Short, Rt Hon E.(Newcastle C)

Fletcher, Ted (Darlington)

McDonald, Dr Oonagh

Short, Mrs Renée (Wolv NE)

Foot, Rt Hon Michael

MacFarquhar, Roderick

Silkin Rt, Hon, John(Denford)

Ford, Ben

McGuire, Michael (Ince)

Silkin Rt Hon S.C.(Dulwich)

Forrester, John

MacKenzie, Gregor

Sillars,James

Fowler, Gerald (The Wrekin)

Mackintosh, John P.

Silverman, Julius

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

Maclennan, Robert

Skinner Dennis

Freeson, Reginald

McMillan, Tom (Glasgow C)

Small, William

Garrett, John (Norwich S)

Madden, Max

Smith, John (N Lanarkshire)

Garrett, W. E. (Wallsend)

Magee, Bryan

Snape Peter

George, Bruce

Mahon, Simon

Spearing, Nigel

Gilbert, Dr John

Mallalleu, J. p. W.

Spriggs, Leslie

Ginsburg, David

Marks, Kenneth

Stallard, A.W.

Golding, John

Marquand, David

Stewart, Rt Hon M. (Fulham)

Gould, Bryan

Marshall, Dr Edmund (Goole)

Stoddart, David

Gourlay, Harry

Marshall, Jim (Leicester S)

Stott, Roger

Graham, Ted

Mason, Rt Hon Roy

Strang, Gavin

Grant, George (Morpeth)

Maynard, Miss Joan

Strauss, Rt Hon G.R.

Grant, John (Islington C)

Meacher, Michael

Summerskill, Hon Dr Shirley

Grocott, Bruce

Mellish, Rt Hon Robert

Swain, Thomas

Hamilton, James (Bothwell)

Mendelson, John

Taylor, Mrs Ann (Bolton W)

Hamilton, W. W. (Central Fife)

Mikardo, Ian

Thomas, Dafydd (Merioneth)

Hardy, Peter

Millan, Bruce

Thomas, Jeffrey (Abertillery)

Harper, Joseph

Miller, Dr M. S. (E Kilbride)

Thomas, Mike (Newcastle E)

Harrison, Walter (Wakefield)

Miller, Mrs Millie (Ilford N)

Thomas, Ron (Bristol NW)

Hart, Rt Hon Judith

Mitchell, R. C. (Solon, Itchen)

Thorne, Stan (Preston South)

Hatton, Frank

Moonman, Eric

Tierney, Sydney

Hayman, Mrs Helene

Morris, Alfred (Wythenshawe)

Tinn, James

Healey, Rt Hon Denis

Morris, Charles R. (Openshaw)

Tomlinson, John

Heffer, Eric S.

Morris, Rt Hon J. (Aberavon)

Tomney, Frank

Hooley, Frank

Moyle, Roland

Torney, Tom

Horam, John

Mulley, Rt Hon Frederick

Tuck, Raphael

Howell, Rt Hon Denis (B'ham, Sm H

Murray, Rt Hon Ronald King

Tuck, Raphael

Hoyle, Doug (Nelson)

Newens, Stanley

Varley, Rt Hon Eric G.

Huckfield, Les

Noble, Mike

Wainwright, Edwin (Dearne V)

Hughes, Rt Hon C. (Anglesey)

Oakes, Gordon

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

Hughes, Mark (Durham)

Ogden, Eric

Walker, Harold (Doncaster)

Hughes, Robert (Aberdeen N)

O'Halloran, Michael

Waker, Terry (Kingswood)

Hughes, Roy (Newport)

Orbach, Maurice

Ward, Michael

Hunter, Adam

Orme, Rt Hon Stanley

Watkins, David

Irvine, Rt Hon Sir A. (Edge Hill)

Ovenden, John

Watkinson, John

Irving, Rt Hon S. (Dartford)

Owen, Dr David

Weetch, Ken

Jackson, Colin (Brighouse)

Padley, Walter

Weitzman, David

Jackson, Miss Margaret (Lincoln)

Palmer, Arthur

Wellbeloved, James

Janner, Greville

Park, George

White, James (Pollok)

Jay, Rt Hon Douglas

Parker, John

Whitehead, Phillip

Jenkins, Hugh (Putney)

Parry, Robert

Whitlock, William

Jenkins, Rt Hon Roy (Stechford)

Pavitt, Laurie

Wigley, Dafydd

John, Brynmor

Peart, Rt Hon Fred

Willey, Rt Hon Frederick

Johnson, James (Hull West)

Pendry, Tom

Williams, Alan (Swansea W)

Johnson, Walter (Derby S)

Perry, Ernest

Williams, Alan Lee (Hornch'ch)

Jones, Barry (East Flint)

Phipps, Dr Colin

Williams, Rt Hon Shirley (Hertford)

Jones, Dan (Burnley)

Prentice, Rt Hon Reg

Williams, Sir Thomas

Judd, Frank

Prescott, John

Wilson, Alexander (Hamilton)

Kaufman, Gerald

Price, C (Lewisham W)

Wilson, Rt Hon (Huyton)

Kelley, Richard

Price, William (Rugby)

Wilson, William (Coventry SE)

Kerr, Russell

Radice, Giles

Wise, Mrs Audrey

Kilroy-Sllk, Robert

Rees, Rt Hon Merlyn (Leeds S)

Woodall, Alee

Kinnock, Nell

Richardson, Miss Jo

Woof, Robert

Lamble, David

Roberts, Albert (Normanton)

Wrigglesworth, Ian

Lamborn, Harry

Roberts, Gwitym (Cannock)

Young, David (Bolton E)

Lamond, James

Robinson, Geoffrey

Latham, Arthur (Paddington)

Roderick, Caerwyn

TELLERS FOR THE NOES:

Leadbitter, Ted

Rodgers, George (Chorley)

Mr. Alf Bates and

Lee, John

Rodgers, William (Stockton)

Mr. Frank R. White.

Division List No. 284 [See col. 385]

Division No. 284.]

AYES

[10.20 p.m.

Adley, Robert

Awdry, Daniel

Bennett, Sir Frederic (Torbay)

Aitken, Jonathan

Bain, Mrs Margaret

Bennett, Dr Reginald (Fareham)

Alison, Michael

Baker, Kenneth

Benyon, W.

Amery, Rt Hon Julian

Banks Robert

Berry, Hon Anthony

Arnold, Tom

Beith, A. J.

Biffen, John

Atkins, Rt Hon H. (Spelthorne)

Bell, Ronald

Biggs-Davison, John

Blaker, Peter

Hall, Sir John

Morgan, Geraint

Body, Richard

Hall-Davis, A.G.F.

Morgan-Giles, Rear-Admiral

Boscawen, Hon Robert

Hamilton, Michael (Salisbury)

Morris, Michael (Northampton S)

Bottomley, Peter

Hampson, Dr Keith

Morrison, Charles (Devizes)

Bowden, A. (Brighton, Kemptown)

Hannam, John

Morrison, Hon Peter (Chester)

Boyson, Dr Rhodes (Brent)

Harrison, Col Sir Harwood (Eye)

Mudd, David

Bradford, Rev Robert

Harvie Anderson, Rt Hon Miss

Neave, Airey

Brittan, Leon

Hastings, Stephen

Nelson, Anthony

Brotherton, Michael

Havers, Sir Michael

Neubert, Michael

Brown, Sir Edward (Bath)

Hawkins, Paul

Newton, Tony

Bryan, Sir Paul

Hayhoe, Barney

Normanton, Tom

Buchanan-Smith, Alick

Heath, Rt Hon Edward

Nott, John

Buck, Antony

Henderson, Douglas

Onslow, Cranley

Budgen, Nick

Heseltine, Michael

Oppenheim, Mrs Sally

Bulmer, Esmond

Hicks, Robert

Osborn, John

Burden, F. A.

Higgins, Terence L.

Page, John (Harrow West)

Butler, Adam (Bosworth)

Holland, Philip

Page, Rt Hon R. Graham (Crosby)

Carlisle, Mark

Hooson, Emlyn

Paisley, Rev Ian

Carson, John

Hordern, Peter

Penhaligon, David

Chalker, Mrs Lynda

Howe, Rt Hon Sir Geoffrey

Percival, Ian

Channon, Paul

Howell, David (Guildford)

Peyton, Rt Hon John

Churchill, W. S.

Howell, Ralph (North Norflok)

Pink, R. Bonner

Clark, Alan (Plymouth, Sutton)

Rowells, Geraint (Cardigan)

Powell, Rt Hon J. Enoch

Clark, William (Croydon S)

Hunt, David (Wirral)

Price, David (Eastleigh)

Clarke, Kenneth (Rushcliffe)

Hunt, John (Bromley)

Prior, Rt Hon James

Clegg, Walter

Hurd, Douglas

Pym, Rt Hon Francis

Cockcrott, John

Hutchison, Michael Clark

Ralson, Timothy

Cooke, Robert (Bristol W)

Irving, Charles (Cheltenham)

Rathbone, Tim

Cope,John

James, David

Rawlinson, Rt Hon Sir Peter

Cordle, John H.

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

Rees, Peter (Dover & Deal)

Cormack, Patrick

Jessel, Toby

Rees-Davies, W. R.

Corrie, John

Johnson Smith, G. (E Grinstead)

Reid, George

Costain, A. P.

Johnston, Russell (Inverness)

Renton, Rt Hon Sir D. (Hunts)

Craig, Rt Hon W. (Belfast E)

Jones, Arthur (Daventry)

Renton, Tim (Mid-Sussex)

Crawford, Douglas

Jopling, Michael

Rhys Williams, Sir Brandon

Critchley, Julian

Joseph, Rt Hon Sir Keith

Ridley, Hon Nicholas

Crouch, David

Kaberry, Sir Donald

Ridsdale, Julian

Crowder, F. P.

Kellett-Bowman, Mrs Elalne

Rifkind, Malcolm

Davies, Rt Hon J. (Knutsford)

Kershaw, Anthony

Roberts, Michael (Cardiff NW)

Dean, Paul (N Somerset)

Kilfedder, James

Roberts, Wyn (Conway)

Dodsworth, Geoffrey

Kimball, Marcus

Rodgers, Sir John (Sevenoaks)

Douglas-Hamilton, Lord James

King, Evelyn (South Dorset)

Ross, Stephen (Isle of Wight)

Drayson, Burnaby

King, Tom (Bridgwater)

Ross, William (Londonderry)

du Cann, Rt Hon Edward

Kirk, Sir Peter

Rossi, Hugh (Hornsey)

Dunlop, John

Kitson, Sir Timothy

Rost, Peter (SE Derbyshire)

Durant, Tony

Knight, Mrs Jill

Royle, Sir Anthony

Dykes, Hugh

Knox, David

Sainsbury, Tim

Eden, Rt Hon Sir John

Lamont, Norman

St. John-Stevas, Norman

Edwards, Nicholas (Pembroke)

Lane, David

Scott, Nicholas

Elliott, Sir William

Langford-Holt, Sir John

Scott-Hopkins, James

Emery, Peter

Latham, Michael (Melton)

Shaw, Giles (Pudsey)

Evans, Gwynfor (Carmarthen)

Lawrence, Ivan

Shaw, Michael (Scarborough)

Ewing, Mrs Winifred (Moray)

Lawson, Nigel

Shelton, William (Streatham)

Eyre, Reginald

Lester, Jim (Beeston)

Shepherd, Colin

Fairbairn, Nicholas

Lewis, Kenneth (Rutland)

Shersby, Michael

Fairgrieve, Russell

Lloyd, Ian

Silvester, Fred

Farr, John

Loveridge, John

Sims, Roger

Fell, Anthony

Luce, Richard

Sinclair, Sir Roger

Finsberg, Geoffrey

MacCormick, lain

Skeet, T. H. H.

Fletcher, Alex (Edinburgh N)

McCrindle, Robert

Smith, Cyril (Rochdale)

Fletcher-Cooke, Charles

Macfarlane, Neil

Smith, Dudley (Warwick)

Forman, Nigel

MacGregor, John

Speed, Keith

Fowler, Norman (Sutton C'f'd)

Macmillan, Rt Hon M. (Farnham)

Spence, John

Fox, Marcus

McNair-Wilson, M. (Newbury)

Spicer, Jim (W Dorset)

Fraser, Rt Hon H. (Stafford & St)

McNair-Wilson, P. (New Forest)

Spicer, Michael (S Worcester)

Freud, Clement

Madel, David

Sproat, Iain

Fry, Peter

Marshall, Michael (Arundel)

Stainton, Keith

Galbraith, Hon T. G. D.

Marten, Nell

Stanbrook, Ivor

Gardiner, George (Reigate)

Mates, Michael

Stanley, John

Gardner, Edward (S Fylde)

Mather, Carol

Steel, David (Roxburgh)

Gilmour, Rt Hon Ian (Chesham)

Maude, Angus

Steen, Anthony (Wavertree)

Gilmour, Sir John (East Fife)

Maudling, Rt Hon Reginald

Stewart, Donald (Western Isles)

Glyn, Dr Alan

Mawby, Ray

Stewart, Ian (Hitchin)

Godber, Rt Hon Joseph

Maxwell-Hyslop, Robin

Stokes, John

Goodhart, Philip

Mayhew, Patrick

Tapsell, Peter

Goodhew, Victor

Meyer, Sir Anthony

Taylor, R. (Croydon NW)

Goodlad, Alastair

Miller, Hal (Bromsgrove)

Taylor, Teddy (Cathcart)

Gorst, John

Mills, Peter

Tebbit, Norman

Gow, Ian (Eastbourne)

Miscampbell, Norman

Temple-Morris, Peter

Gower, Sir Raymond (Barry)

Mitchell, David (Basingstoke)

Thatcher, Rt Hon Margaret

Grant, Anthony (Harrow C)

Moate, Roger

Thomas, Dafydd (Merioneth)

Gray, Hamish

Molyneaux, James

Thomas, Rt Hon P. (Hendon S)

Griffiths, Eldon

Monro, Hector

Thompson, George

Grimond, Rt Hon J.

Montgomery, Fergus

Thorpe, Rt Hon Jeremy (N Devon)

Grist, Ian

Moore, John (Croydon C)

Townsend, Cyril D.

Grylls, Michael

More, Jasper (Ludlow)

Trotter, Neville

Tugendhat, Christopher

Walters, Dennis

Wilson, Gordon (Dundee E)

van Straubenzee, W. R.

Warren, Kenneth

Winterton, Nicholas

Vaughan, Dr Gerard

Watt, Hamish

Wood, Rt Hon Richard

Viggers, Peter

Weatherill, Bernard

Young, Sir G. (Ealing, Acton)

Wainwright, Richard (Coins V)

Wells, John

Younger, Hon George

Wakenham, John

Welsh, Andrew

Walder, David (Clitheroe)

Whitelaw, Rt Hon William

TELLERS FOR THE AYES:

Walker, Rt Hon P. (Worcester)

Wiggin, Jerry

Mr. Spencer Le Marchant and

Walker-Smith, Rt Hon Sir Derek

Wigley, Dafydd

Mr. Cecil Parkinson.

Wall, Patrick

NOES

Abse, Leo

Dunn, James A.

Kelley, Richard

Allaun, Frank

Dunnett, Jack

Kerr, Russell

Anderson, Donald

Dunwoody, Mrs Gwyneth

Kilroy-Silk, Robert

Archer, Peter

Eadie, Alex

Kinnock, Nell

Armstrong, Ernest

Edge, Geoff

Lamble, David

Ashley, Jack

Edwards, Robert (Wolv SE)

Lamborn, Harry

Ashton, Joe

Ellis, John (Brigg & Scun)

Lamond, James

Atkins, Ronald (Preston N)

Ellis, Tom (Wrexham)

Latham, Arthur (Paddington)

Atkinson, Norman

English, Michael

Leadbitter, Ted

Bagier, Gordon A. T.

Ennals, David

Lee, John

Barnett, Guy (Greenwich)

Evans, Fred (Caerphilly)

Lestor, Miss Joan (Eton & Slough)

Barnett, Rt Hon Joel (Heywood)

Evans, loan (Aberdare)

Lever, Rt Hon Harold

Bates, Alf

Evans, John (Newton)

Lewis, Arthur (Newham, N)

Bean, R. E.

Ewing, Harry (Stirling)

Lewis, Ron (Carlisle)

Benn, Rt Hon Anthony Wedgwood

Faulds, Andrew

Lipton, Marcus

Bennett, Andrew (Stockport N)

Fernyhough, Rt Hon E.

Litterick, Tom

Bidwell, Sydney

Fitch. Alan (Wigan)

Lomas, Kenneth

Bishop, E. S.

Fitt, Gerard (Belfast W)

Loyden, Eddie

Blenkinsop, Arthur

Flannery, Martin

Luard, Evan

Boardman, H.

Fletcher, L. R. (Ilkeston)

Lyons, Edward (Bradford W)

Booth, Rt Hon Albert

Fletcher, Ted (Darlington)

Mabon, Dr J. Dickson

Boothroyd, Miss Betty

Foot, Rt Hon Mlch8el

McCartney, Hugh

Bottomley, Rt Hon Arthur

Ford, Ben

McDonald, Dr Oonagh

Boyden, James (Bish Auck)

Forrester, John

MacFarquhar, Roderick

Bradley, Tom

Fowler, Gerald (The Wrekin)

McGuire, Michael (Ince)

Bray, Dr Jeremy

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

MacKenzie, Gregor

Brown, Hugh D. (Provan)

Freeson, Reginald

Mackintosh, John P.

Brown, Robert C. (Newcastle W)

Garrett, John (Norwich S)

Maclennan, Robert

Brown, Ronald (Hackney S)

Garrett, W. E. (Wallsend)

McMillan, Tom (Glasgow C)

Buchan, Norman

George, Bruce

Madden, Max

Buchanan, Richard

Gilbert, Dr John

Magee, Bryan

Butler, Mrs Joyce (Wood Green)

Ginsburg, David

Mahon, Simon

Callaghan, Rt Hon J. (Cardiff SE)

Golding, John

Mellalleu, J. P. W.

Callaghan, Jim (Middleton & P)

Gould, Bryan

Marks, Kenneth

Campbell, Ian

Gourlay, Harry

Marquand, David

Canavan, Dennis

Graham, Ted

Marshall, Dr Edmund (Goole)

Cant, R. B.

Grant, George (Morpeth)

Marshall, Jim (Leicester S)

Carmichael, Neil

Grant, John (Islington C)

Mason, Rt Hon Roy

Carter, Ray

Grocott, Bruce

Maynard, Miss Joan

Cartwright, John

Hamilton. W. W. (Central Fife)

Meacher, Michael

Castle, Rt Hon Barbara

Hardy, Peter

Mellish, Rt Hon Robert

Clemitson, Ivor

Harrison. Walter (Wakefield)

Mendelson, John

Cocks, Michael (Bristol S)

Hart, Rt Hon Judith

Mikardo, Ian

Cohen, Stanley

Hattersley, Rt Hon Roy

Millan, Bruce

Coleman, Donald

Hatton, Frank

Miller, Dr M. S. (E Kilbride)

Colquhoun, Ms Maureen

Hayman, Mrs Helens

Miller, Mrs Millie (Ilford N)

Conlan, Bernard

Healey, Rt Hon Denis

Mitchell, R. C. (Soton, Itchen)

Cook, Robin F. (Edin C)

Heffer, Eric S.

Moonman, Eric

Corbett, Robin

Hooley, Frank

Morris, Alfred (Wythenshawe)

Cox, Thomas (Tooting)

Horam, John

Morris, Charles R. (Openshaw)

Craigen, J. M. (Maryhill)

Howell, Rt Hon Denis (B'ham,Sm H)

Morris, Rt Hon J. (Aberavon)

Crawshaw, Richard

Hoyle, Doug (Nelson)

Moyle, Roland

Cronin, John

Huckfield, Les

Mulley, Rt Hon Frederick

Crosland, Rt Hon Anthony

Hughes, Rt Hon C. (Anglesey)

Murray, Rt Hon Ronald King

Crowther, Stan (Rotherham)

Hughes, Mark (Durham)

Newens, Stanley

Cryer, Bob

Hughes, Robert (Aberdeen N)

Noble, Mike

Cunningham, G. (Islington S)

Hughes, Roy (Newport)

Oakes, Gordon

Cunningham, Dr J. (Whiteh)

Hunter, Adam

Ogden, Eric

Dalyell, Tarn

Irvine, Rt Hon Sir A. (Edge Hill)

O'Halloran, Michael

Davidson, Arthur

Irving, Rt Hon S. (Dartford)

Orbach, Maurice

Davies. Bryan (Enfield N)

Jackson, Colin (Brighouse)

Orme, Rt Hon Stanley

Davis, Denzil (Llanelli)

Jackson, Miss Margaret (Lincoln)

Ovenden, John

Davies, Ifor (Gower)

Janner, Greville

Owen, Dr David

Davis, Clinton (Hackney C)

Jay. Rt Hon Douglas

Padley, Walter

Deakir., Eric

Jenkins, Hugh (Putney)

Palmer, Arthur

Dean, Joseph (Leeds West)

Jenkins, Rt Hon Roy (Stechford)

Park, George

de Freitas, Rt Hon Sir Geoffrey

John, Brynmor

Parker, John

Dell, Rt Hon Edmund

Johnson, James (Hull West)

Parry, Robert

Dempsey, James

Johnson, Walter (Derby S)

Pavitt, Laurie

Doig, Peter

Jones, Barry (East Flint)

Peart, Rt Hon Fred

Dormand, J. D.

Jones. Dan (Burnley)

Pendry, Tom

Douglas-Mann, Bruce

Judd, Frank

Perry, Ernest

Duffy, A. E. P.

Kaufman, Gerald

Phipps, Dr Colin

Prentice, Rt Hon Reg

Skinner, Dennis

Walker, Harold (Doncaster)

Prescott, John

Small, William

Walker, Terry (Kingswood)

Price, C (Lewisham W)

Smith, John (N Lanarkshire)

Ward, Michael

Price, William (Rugby)

Snape, Peter

Watkins, David

Radice, Giles

Spearing, Nigel

Watkinson, John

Rees, Rt Hon Merlyn (Leeds S)

Spriggs, Leslie

Weetch, Ken

Richardson, Miss Jo

Stallard, A. W.

Weitzman, David

Roberts, Albert (Normanton)

Stewart, Rt Hon M. (Fulham)

Wellbeloved, James

Roberts, Gwilym (Cannock)

Stoddart, David

White, Frank R. (Bury)

Robinson, Geoffrey

Stott, Roger

White, James (Pollok)

Roderick, Caerwyn

Strang, Gavin

Whitehead, Phillip

Rodgers, George (Chorley)

Strauss, Rt Hon G. R.

Whitlock, William

Rodgers, William (Stockton)

Summerskill, Hon Dr Shirley

Willey, Rt Hon Frederick

Rooker, J. W.

Swain, Thomas

Williams, Alan (Swansea W)

Roper, John

Taylor, Mrs Ann (Bolton W)

Williams, Alan Lee (Hornch'ch)

Rose, Paul B.

Thomas, Jeffrey (Abertillery)

Williams, Rt Hon Shirley (Hertford)

Ross, Rt Hon W. (Kilmarnock)

Thomas, Mike (Newcastle E)

Williams, Sir Thomas

Rowlands, Ted

Thomas, Ron (Bristol NW)

Wilson, Alexander (Hamilton)

Sandelson, Neville

Thome, Stan (Preston South)

Wilson, Rt Hon Sir Harold (Huyton)

Sedgemore, Brian

Tierney, Sydney

Wilson, William (Coventry SE)

Selby, Harry

Tinn, James

Wise, Mrs Audrey

Shaw, Arnold (Ilford South)

Tomlinson, John

Woodall, Alec

Sheldon, Robert (Ashton-u-Lyne)

Tomney, Frank

Woof, Robert

Shore, Rt Hon Peter

Torney, Tom

Wrigglesworth, Ian

Short, Rt Hon E. (Newcastle C)

Tuck, Raphael

Young, David (Bolton E)

Short, Mrs Renée (Wolv NE)

Urwin, T. W.

Silkin, Rt Hon John (Deptford)

Varley, Rt Hon Eric G.

TELLERS FOR THE NOES:

Silkin, Rt Hon S. C. (Dulwich)

Wainwright, Edwin (Dearne V)

Mr. Joseph Harper and

Sillars, James

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

Mr. James Hamilton.

Silverman, Julius

LICENSING (SCOTLAND) BILL
Division List No. 285 [See col. 483]

Division No. 285.]

AYES

[3.24 a.m.

Beith, A. J.

Galbraith, Hon T. G. D.

Ross, Rt Hon W (Kilmarnock)

Bradford, Rev R.

Gray, Hamish

Ross, Wm. (Londonderry)

Bray, Dr Jeremy

Grimond, Rt Hon J.

Small, William

Buchanan, Richard

Hamilton, James (Bothwell)

Smith, John (North Lanarkshire)

Carson, John

Hamilton, W. W. (Central Fife)

Steel, David (Roxburgh)

Corrie, John

Harvie Anderson, Rt Hon Miss

Stewart, Donald (Western Isles)

Dalyell, Tarn

Hunter, Adam

Taylor, Teddy (Cathcart)

Dempsey, James

Johnston, Russell (Inverness)

Welsh, Andrew

Doig, Peter

Lamond, James

Eadie, Alex

MacKenzie, Gregor

TELLERS FOR THE AYES:

Ewing, Harry (Stirling)

Maclennan, Robert

Mr. Robin F. Cook and

Ewing, Mrs Winifred (Moray)

Millan, Bruce

Mr. Ian Campbell.

Fairbairn, Nicholas

Paisley, Rev Ian

NOES

Bagier, Gordon A. T.

Hughes, Robert (Aberdeen N)

Roberts, Michael (Cardiff NW)

Bain, Mrs Margaret

Hutchison, Michael Clark

Selby, Harry

Brown, Hugh D. (Provan)

Jopling, Michael

Sillars, James

Buchanan-Smith, Alick

Kimball, Marcus

Skinner, Dennis

Canavan, Dennis

Kitson, Sir Timothy

Sproat, lain

Carmichael, Neil

Knox, David

Stradling Thomas, J.

Cocks, Michael (Bristol South)

Lambie, David

Strang, Gavin

Conlan, Bernard

Le Marchant, Spencer

Thomas, Ron (Bristol North West)

Craigen, J. M. (Maryhill)

Lester, Jim (Beeston)

Thompson, George

Crawford, Douglas

Loyden, Eddie

Urwin, Tom

Douglas-Hamilton, Lord James

Mabon, Dr J. Dickson

Watt, Hamish

Durant, Tony

McCartney, Hugh

White, James (Pollok)

Fairgrieve, Russell

MacCormick, lain

Wilson, Alexander (Hamilton)

Flannery, Martin

McMillan, Tom (Glasgow Central)

Wilson, Gordon (Dundee East)

Fletcher, Alexander (Edinburgh N)

Miller, Dr M. S. (East Kilbride)

Younger, Hon George

Gourlay, Harry

Monro, Hector

Grist, Ian

Murray, Rt Hon Ronald King

TELLERS FOR THE NOES:

Harrison, Walter (Wakefield)

Parry, Robert

Mr. John P. Mackintosh and

Hart, Rt Hon Judith

Rees-Davies, W. R.

Sir. John Gilmour.

Henderson, Douglas

Rifkind, Malcolm

Division List No. 286 [See col. 493]

Division No.286.]

AYES

[4.09 a.m.

Buchanan-Smith, Alick

Lester, Jim (Beeston)

Corrie, John

Monro, Hector

TELLERS FOR THE AYES:

Fairgrieve, Russell

Rifkind, Malcolm

Mr. Teddy Taylor and

Gray, Hamish

Welsh, Andrew

Lord James Douglas-Hamilton.

Le Marchant, Spencer

Younger, Hon George

NOES

Bagier, Gordon A. T.

Gilmour, Sir John (East Fife)

Ross, Rt Hon W. (Kilmarnock)

Bain, Mrs Margaret

Harrison, Walter (Wakefield)

Selby, Harry

Beith, A. J.

Hart, Rt Hon Judith

Sillars, James

Bray, Dr Jeremy

Henderson, Douglas

Skinner, Dennis

Brown, Hugh D. (Provan)

Hughes, Robert (Aberdeen N)

Smith, John (North Lanarkshire)

Buchan, Norman

Hunter, Adam

Steel, David (Roxburgh)

Buchanan, Richard

Hutchison, Michael Clark

Stewart, Donald (Western Isles)

Campbell, Ian

Johnston, Russell (Inverness)

Strang, Gavin

Canavan, Dennis

Lambie, David

Thompson, George

Carmichael, Neil

McCartney, Hugh

Urwin, Tom

Cocks, Michael (Bristol South)

MacKenzie, Gregor

Watt, Hamish

Craigen, J. M. (Maryhill)

Mackintosh, John P.

White, James (Pollok)

Crawford, Douglas

Maclennan, Robert

Wilson, Alexander (Hamilton)

Dalyell, Tarn

McMillan, Tom (Glasgow Central)

Wilson, Gordon (Dundee East)

Dempsey, James

Millan, Bruce

Doig, Peter

Miller, Dr M. S. (East Kilbride)

TELLERS FOR THE NOES:

Eadle, Alex

Murray, Rt Hon Ronald King

Mr. James Hamilton and

Ewing, Harry (Stirling)

Reid, George

Mr. Robin F. Cook.

Ewing, Mrs Winifred (Moray)

Division List No. 287 [See col. 499]

Division No. 287.]

AYES

[4.34 a.m.

Bagier, Gordon A. T.

Hughes, Robert (Aberdeen North)

Sillars, James

Beith, A. J.

Hunter, Adam

Skinner, Dennis

Brown, Hugh D. (Provan)

Johnston, Russell (Inverness)

Small, William

Buchan, Norman

Lambie, David

Smith, John (North Lanarkshire)

Campbell, Ian

McCartney, Hugh

Steel, David (Roxburgh)

Canavan, Dennis Carmichael, Nell

MacKenzie, Gregor Mackintosh, John P.

Strang, Gavin

Cocks, Michael (Bristol South)

Maclennan, Robert

Urwin, Tom

Dalyell, Tarn

McMillan, Tom (Glasgow Central)

White, James (Pollok)

Dempsey, James

Millan, Bruce

Wilson, Alexander (Hamilton)

Doig, Peter

Miller, Dr M. S. (East Kilbride)

Eadie, Alex

Murray, Rt Hon Ronald King

TELLERS FOR THE AYES:

Ewing, Harry (Stirling)

Ross, Rt Hon W. (Kilmarnock)

Mr. James Hamilton and

Harrison, Walter (Wakefield)

Selby, Harry

Mr. Robin F. Cook.

Hart, Rt Hon Judith

NOES

Bain, Mrs Margaret

Gray, Hamish

Thompson, George

Buchanan, Richard

Henderson, Douglas

Watt, Hamish

Buchanan-Smith, Alick

Hutchison, Michael Clark

Welsh, Andrew

Crawford, Douglas

Le Marchant, Spencer

Wilson, Gordon (Dundee East)

Douglas-Hamilton, Lord James

Lester, Jim (Beeston)

Younger, Hon George

Ewing, Mrs Winifred (Moray)

Reid, George

Fairbairn, Nicholas

Rifkind, Malcolm

TELLERS FOR THE NOES:

Fairgrieve, Russell

Stewart, Donald (Western Isles)

Mr. John Corrie and

Gilmour, Sir John (East Fife)

Taylor, Teddy (Cathcart)

Mr. Hector Monro.

Division List No. 288 [See col. 505

Division No. 288.]

AYES

[5.04 a.m.

Bain, Mrs Margaret

Johnston, Russell (Inverness)

Beith, A. J.

Le Merchant, Spencer

TELLERS FOR THE AYES:

Fairbairn, Nicholas

Lester, Jim (Beeston)

Mr. Donald Stewart and

Gray, Hamish

Welsh, Andrew

Mr. Teddy Taylor.

Hutchison, Michael Clark

NOES

Bagier, Gordon A. T.

Gilmour, Sir John (East Fife)

Ross, Rt Hon W. (Kilmarnock)

Brown, Hugh D. (Provan)

Harrison, Walter (Wakefield)

Selby, Harry

Buchan, Norman

Hart, Rt Hon Judith

Sillars, James

Buchanan, Richard

Henderson, Douglas

Skinner, Dennis

Buchanan-Smith, Alick

Hughes, Robert (Aberdeen North)

Small, William

Campbell, Ian

Hunter, Adam

Smith, John (North Lanarkshire)

Canavan, Dennis

Lambie, David

Steel, David (Roxburgh)

Carmichael, Nell

McCartney, Hugh

Strang, Gavin

Cocks, Michael (Bristol South)

MacKenzie, Gregor

Thompson, George

Corrie, John

Mackintosh, John P.

Urwin, Tom

Dalyell, Tarn

Maclennan, Robert

Watt, Hamish

Dempsey, James

McMillan, Tom (Glasgow Central)

White, James (Pollok)

Doig, Peter

Millan, Bruce

Wilson, Alexander (Hamilton)

Douglas-Hamilton, Lord James

Miller, Dr M. S. (East Kilbride)

Wilson, Gordon (Dundee East)

Eadie, Alex

Monro, Hector

Ewing, Harry (Stirling)

Murray, Rt Hon Ronald King

TELLERS FOR THE NOES:

Ewing, Mrs Winifred (Moray)

Reid, George

Mr. James Hamilton and

Fairgrieve, Russell

Rifkind, Malcolm

Mr. Robin F. Cook.

Division List No. 289 [See col. 524]

Division No. 289.]

AYES

[6.14 a.m.

Beith, A. J.

Thompson, George

TELLERS FOR THE AYES:

Reid, George

Welsh, Andrew

Mrs. Margaret Bain and

Stewart, Donald (Western Isles)

Wilson, Gordon (Dundee East)

Mr. Hamish Watt.

Taylor, Teddy (Cathcart)

NOES

Bagier, Gordon A. T.

Douglas-Hamilton, Lord James

Lambie, David

Brown, Hugh D. (Provan)

Eadie, Alex

Le Marchant, Spencer

Buchan, Norman

Ewing, Harry (Stirling)

McCartney, Hugh

Buchanan-Smith, Alick

Ewing, Mrs Winifred (Moray)

MacCormick, Iain

Canavan, Dennis

Fairgrieve, Russell

MacKenzie, Gregor

Carmichael, Nell

Gilmour, Sir John (East Fife)

Mackintosh, John P.

Cocks, Michael (Bristol South)

Gray, Hamish

Maclennan, Robert

Cook, Robin F. (Edinburgh Central)

Harrison, Walter (Wakefield)

McMillan, Tom (Glasgow Central)

Corrie, John

Hart, Rt Hon Judith

Millan, Bruce

Craigen, J. M. (Maryhill)

Hughes, Robert (Aberdeen North)

Miller, Dr M. S. (East Kilbride)

Dalyell, Tarn

Hunter, Adam

Monro, Hector

Dempsey, James

Hutchison, Michael lark

Murray, Rt Hon Ronald King

Doig, Peter

Johnston, Russell (Inverness)

Rifkind, Malcolm

Ross, Rt Hon W. (Kilmarnock)

Smith, John (North Lanarkshire)

Wilson, Alexander (Hamilton)

Selby, Harry

Steel, David (Roxburgh)

Sillars, James

Strang, Gavin

TELLERS FOR THE NOES:

Skinner, Dennis

Urwin, Tom

Mr. James Hamilton and

Small, William

White, James (Pollok)

Mr. Ian Campbell.

Division List No. 290 [See col. 525]

Division No. 290.]

AYES

[6.26 a.m.

Bain, Mrs Margaret

Ewing, Mrs Winifred (Moray)

Welsh, Andrew

Beith, A. J.

Stewart, Donald (Western Isles)

Buchanan, Richard

Taylor, Teddy (Cathcart)

TELLERS FOR THE AYES:

Corrie, John

Thompson, George

Mr. Hamish Gray and

Dempsey, James

Watt, Hamish

Mr. Russell Johnston.

Douglas-Hamilton, Lord James

NOES

Bagier, Gordon A. T.

Hughes, Robert (Aberdeen North)

Ross, Rt Hon W. (Kilmarnock)

Brown, Hugh D. (Provan)

Hunter, Adam

Selby, Harry

Buchan, Norman

Lamble, David

Sillars, James

Buchanan-Smith, Alick

Le Marchant, Spencer

Skinner, Dennis

Canavan, Dennis

Lester, Jim (Beeston)

Small, William

Carmichael, Nell

McCartney, Hugh

Smith, John (North Lanarkshire)

Cocks, Michael (Bristol South)

MacCormick, lain

Steel, David (Roxburgh)

Cook, Robin F. (Edinburgh C)

MacKenzie, Gregor

Strang, Gavin

Craigen, J. M. (Maryhill)

Mackintosh, John P.

Urwin, Tom

Dalyell, Tarn

McMillan, Tom (Glasgow Central)

White, James (Pollok)

Doig, Peter

Millan, Bruce

Wilson, Alexander (Hamilton)

Eadie, Alex

Miller, Dr M. S. (East Kilbride)

Wilson, Gordon (Dundee East)

Ewing, Harry (Stirling)

Monro, Hector

Fairgrieve, Russell

Murray, Rt Hon Ronald King

TELLERS FOR THE NOES:

Gilmour, Sir John (East Fife)

Reid, George

Mr. James Hamilton and

Harrison, Walter (Wakefield)

Rifkind, Malcolm

Mr. Ian Campbell.

Hart, Rt Hon Judith

Division List No. 291 [See col. 532]

Division No. 291.]

AYES

[6.58 a.m.

Bagier, Gordon A. T.

Hart, Rt Hon Judith

Skinner, Dennis

Bain, Mrs Margaret

Hughes, Robert (Aberdeen North)

Steel, David (Roxburgh)

Buchan, Norman

Johnston, Russell (Inverness)

Thompson, George

Buchanan-Smith, Alick

Le Marchant, Spencer

Welsh, Andrew

Carmichael, Nell

McCartney, Hugh

White, James (Pollok)

Cook, Robin F. (Edinburgh Central)

MacCormick, lain

Wilson, Alexander (Hamilton)

Corrie, John

McMillan, Tom (Glasgow Central)

Wilson, Gordon (Dundee East)

Dempsey, James

Miller, Dr M. S. (East Kilbride)

Ewing, Mrs Winifred (Moray)

Monro, Hector

TELLERS FOR THE AYES:

Fairgrieve, Russell

Rifkind, Malcolm

Mr. Dennis Canavan and

Gilmour, Sir John (East Fife)

Selby, Harry

Mr. David Lambie.

Gray, Hamish

Sillars, James

NOES

Beith, A.J.

Hunter, Adam

Stewart, Donald (Western Isles)

Brown, Hugh D. (Provan)

MacKenzie, Gregor

Strang, Gavin

Buchanan, Richard

Maclennan, Robert

Urwin, Tom

Cocks, Michael (Bristol South)

Millan, Bruce

Watt, Hamish

Craigen, J. M. (Maryhill)

Murray, Rt Hon Ronald King

Dalyell, Tarn

Reid, George

TELLERS FOR THE NOES:

Doig, Peter

Ross, Rt Hon W. (Kilmarnock)

Mr. James Hamilton and

Ewing, Harry (Stirling)

Small, William

Mr. Ian Campbell.

Harrison, Walter (Wakefield)

Smith, John (North Lanarkshire)

Division List No. 292 [See col. 548]

Division No. 292.]

AYES

[8.02 a.m

Bain, Mrs Margaret

Stewart, Donald (Western Isles)

Beith, A. J.

Thompson, George

TELLERS FOR AYES

Ewing, Mrs Winifred (Moray)

Watt, Hamish

Mr. Andrew Welsh and

McMillan, Tom (Glasgow Central)

Wilson, Gordon (Dundee East)

Mr.Tedd,Taylor.

Reid, George

NOES

Bagier, Gordon A. T.

Harrison, Walter (Wakefield)

Selby, Harry

Brown, Hugh D. (Provan)

Hart, Rt Hon Judith

Sillars, James

Buchan, Norman

Hughes, Robert (Aberdeen North)

Skinner, Dennis

Buchanan, Richard

Hunter, Adam

Smith, John (North Lanarkshire)

Canavan, Dennis

Johnston, Russell (Inverness)

Steel, David (Roxburgh)

Carmichael, Neil

Lambie, David

Strang, Gavin

Cocks, Michael (Bristol South)

McCartney, Hugh

Urwin, Tom

Cook, Robin F. (Edinburgh Central)

MacKenzie, Gregor

White, James (Pollok)

Dalyell, Tarn

Maclerman, Robert

Wilson, Alexander (Hamilton)

Dempsey, James

Millan, Bruce

Doig, Peter

Miller, Dr M. S. (East Kilbride)

TELLERS FOR THE NOES:

Eadie, Alex

Murray, Rt Hon Ronald King

Mr. James Hamilton and

Ewing, Harry (Stirling)

Ross, Rt Hon W. (Kilmarnock)

Mr. Ian Campbell.

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

TORTURE OF PRISONERS
Lord BROCKWAY: 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 what action has been taken to establish international supervision of the implementation of the Convention on Civil and Political Rights, Article 7, to prevent torture of prisoners, either through the Human Rights Committee of the United Nations or by authorising the International Red Cross to investigate and report.
The MINISTER of STATE, FOREIGN and COMMONWEALTH OFFICE (Lord Goronwy-Roberts): My Lords, implementation of the Covenant on Civil and Political Rights will be supervised by the Committee on Human Rights which will be formed by election on 20th September. It is our firm intention to do all we can to ensure that the Covenant will be implemented effectively and that the process of implementation will be started without undue delay. To this end we wish to see the formation of a strong and impartial committee capable of making the Covenant an effective instrument against torture and other violations of human rights.
Lord BROCKWAY: My Lords, while appreciating that Answer, may I ask the Minister whether he can say, first, if it is likely that the United Kingdom will be represented on the United Nations Human Rights Committee? Secondly, will he say, if we are so represented, whether we shall press for investigation either directly, as on the European model, or through the International Red Cross?
Lord GORONWY-ROBERTS: My Lords, Sir Vincent Evans, the former Foreign and Commonwealth Office legal
1170
adviser, the principal legal adviser to the Secretary of State and an expert on the Covenant and other aspects of the international protection of human rights, has agreed to be the British nominee for this committee. We naturally hope that he will succeed in the elections which will be held on 20th September. As to the second supplementary question which my noble friend put to me, I do not rule out, and I am sure that Sir Vincent, if he is successful in the election, will not rule out, the two possibilities which my noble friend has put to us this afternoon.
Baroness EMMET of AMBERLEY: My Lords, while thanking the Minister for that answer, may I ask whether he is aware that those of us who have supported the United Nations, having been there, and the Red Cross in their humanitarian and international efforts, really cannot understand why, on this particular question which is of supreme importance and interest to everybody, the United Nations could not approach the Red Cross, who I am quite sure would respond, with a view to having some immediate attention given to this problem?
Lord GORONWY-ROBERTS: My Lords, I agree with the noble Baroness to the extent that the committee which will be set up under these arrangements will of course be free to consider means whereby the ICRC and any other organisation—one can think of a number of others—may be usefully engaged in the process of implementing the Covenant. I do not think it is possible for any member country, including our own, to overstrain its locus standi to the extent of pressing this point unduly, but I agree with the noble Baroness that the Committee is perfectly free to consider the way in which the ICRC and other organisations can be used, by agreement, to promote the objectives of the Covenant.
Lord PAGET of NORTHAMPTON: My Lords, in the light of all our experience, and particularly of our recent experience, does the Minister seriously envisage the possibility of the United Nations appointing an impartial committee?
Lord GORONWY-ROBERTS: Yes, my Lords.
Baroness ELLES: My Lords, would the Minister encourage our nominee, if he is elected, to get as many individual petitions as possible under the optional protocol, as that might be the only way, in fact, of dealing with this particular problem and of avoiding political backlashes by certain political Parties in various States?
Lord GORONWY-ROBERTS: Yes, indeed, my Lords. Assuming, of course, that Sir Vincent is in fact elected—and I am sure the noble Baroness and I would agree that, although he would be a nominee of this country, he would not represent this country—it would be a very strong suggestion from us that for the general purposes of the committee this would be a very good addition indeed. I am quite sure that Sir Vincent Evans, backed by the view of Her Majesty's Government, would have very much in mind what the noble Baroness has said.
Lord GEORGE-BROWN: My Lords, may I raise a point? Sir Vincent Evans I know very well—a reason, possibly, to put in a black ball—but since the present Government, a member of which is the Minister of State, who, alas!, as Minister of State when I was Secretary of State—
Several noble Lords: Question!
Lord GEORGE-BROWN: The Minister may like to recall that the present Government in this country are not really paying much regard for the rights of individuals—
Several noble Lords: Question!
Lord GEORGE-BROWN: My Lords, every question needs a preamble.
Several noble Lords: No!
Lord GEORGE-BROWN: My Lords, would the Minister please convey this question to the present Secretary of State? Since we do not ourselves regard the rights of individuals as pre-emptive, how is Sir Vincent Evans going to persuade this committee, if he ever gets elected?
Lord GORONWY-ROBERTS: My Lords, Sir Vincent Evans, if he is elected, will have at least as much power in the committee to persuade it on the appropriate modalities and decisions as any other member—rather more, I think, for he
1172
is internationally regarded as an outstanding expert on this type of question. I regret to note my noble friend's reference to our otherwise constructive co-operation at the Foreign Office. I restrain the temptation to translate his personal remark into one somewhat as follows: that he was Secretary of State, alas! when I was Minister of State.
Lord HAILSHAM of SAINT MARY-LEBONE: My Lords, is the noble Lord aware that Sir Vincent Evans is very highly regarded on this side of the House and in public? Is he also aware that, whatever our political differences may be, we have great respect and affection for the Minister himself?
Lord BROCKWAY: My Lords, while we all hope that the British nominee will be elected, could the Minister tell us something about the method of election to this committee: how many candidates there are, and who elect them?
Lord GORONWY-ROBERTS: My Lords, I should be very glad to impart this information to my noble friend if he would put down a separate Question. It is a very detailed answer that I have in mind to that question.
Lord SLATER: My Lords, is my noble friend aware that a number of questions have been asked in regard to this issue, and that the nominee who has been mentioned—he has not yet been elected, so we understand from the reply from the Minister—whoever he may be, shall have to take responsibility on that committee and to speak as an individual on the committee? Are we going to place him in shackles before he goes into the committee room to debate and discuss the major issues before that committee, which will have to arrive at some form of decision?
Lord GORONWY-ROBERTS: That, my Lords, would be exactly the position.
Lord CARADON: My Lords, would my noble friend agree that this is a much wider question than one of instructions to be given to a member of our committee, and that the essential question is that already raised; that is, the capacity of the United Nations to provide that there should be investigation for an established

1173
complaint from an individual as there is in Europe at the moment? Should it not be that our Government in this vital matter, with the evil of torture spreading through the world, should be prepared to take the lead on the main question of principle?
Lord GORONWY-ROBERTS: Yes, my Lords, I entirely agree that in so far as it is possible for the Member States to take an initiative on this matter above all others, there is much force in what my noble friend has said. I shall be conveying what he has said to the Secretary of State. If we are fortunate to have this eminent international jurist on the committee, I think that we shall be the better positioned perhaps to promote the objects which my noble friends have in mind.
Baroness ELLES: My Lords, despite the sentiments which the Minister has expressed—sentiments which, I am sure, are shared by the whole House—would he kindly confirm that the election of Sir Vincent Evans, if he succeeds, will be entirely in his own individual capacity and that he will not be under instructions from any Government?
Lord GORONWY-ROBERTS: Exactly, my Lords. It is a United Kingdom contribution in the form of, as I have said, an eminent jurist, one of great experience and great sympathy in these matters. We are very fortunate to be able to put forward his name. We recognise, of course, that although his background will be the British Foreign and Commonwealth Office, nevertheless he will act, as the noble Baroness has said, as a general member of this committee. Knowing that his background is so impeccable, we shall be completely satisfied if he acts in that capacity.

MEMBERS OF PARLIAMENT: PENSIONS
2.48 p.m.
Lord BOOTHBY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they have received any further recommendations from the Boyle Com
1174
mittee regarding pensions for ex-Members of the House of Commons; and, if so, what they were.
The LORD PRIVY SEAL (Lord Shepherd): My Lords, as my right honourable friend the Lord President of the Council announced in another place on 12th July, the Top Salaries Review Body has submitted a further report to the Prime Minister which should be published within the next few days. I think that it would be preferable to give all concerned the opportunity of studying the report.
Lord BOOTHBY: My Lords, arising out of that Answer, may I ask the noble Lord the Leader of the House whether he is aware that the House of Commons, during the last 10 years, has repeatedly raised the salaries and allowances of its Members—and, indeed, did so last week—whereas there are quite a number of people who served for many years in the House of Commons before 1964 at salaries which nothing like covered expenses, and with no allowances at all? Is he also aware that they get no pension at all and some of them are living in comparative penury? May I ask him whether he is further aware that I have had representations from Members on both sides of both Houses of Parliament asking me to do my best to bring this scandal to an end? Finally, may I ask whether he will ask Lord Boyle to hurry up? Otherwise we shall all be dead—which is what, I suppose, they want.
Lord SHEPHERD: My Lords, I am not too sure about that. The noble Lord has persistently carried out a campaign on behalf of many of his colleagues who served for many years in another place but who had left the other place before the pension arrangements came into force. This matter was once referred to Boyle. It was because of the pressures which were placed upon me by other colleagues in another place that the matter was again sent to Boyle. As I have said, the report has been received. It will be published in the next few days and then there might be an opportunity for considering it, either in your Lordships' House or in another place. I hope that the noble Lord, Lord Boothby, will recognise that this, at the end of the day, is a matter for the House of Commons.
Lord POPPLEWELL: My Lords, can my noble friend tell the House whether the Boyle report, which is to be submitted within the next two or three days, will affect Members of this House? For two years or so, Members have been promised that Boyle is considering matters affecting certain allowances for Members of this House, and each time an interim report has been issued by Boyle the membership of this House has been the missing link. Will we be included on this occasion?
Lord SHEPHERD: My Lords, if my noble friend is referring to the system of expense allowances, the answer is, No. That report has yet to be received. Clearly, any recommendations by Boyle regarding the pensions of ex-MPs will apply to those who are also Members of this House.
Lord JANNER: My Lords, returning to the Question asked by my noble friend Lord Boothby, if the report is coming out within the next few days, does not that mean we shall not be able to discuss it until after the Recess? Is there a possibility of some method being found whereby, if the report is in favour—most of us hope that it is—of pensions being given to those Members, something can be done before the House resumes?
Lord SHEPHERD: My Lords, I cannot anticipate the report. Clearly, this is a matter which would need to be considered by both Houses. We hope to rise for the Recess on Thursday; another place are sitting next week. I cannot believe that we shall be able to debate this report and take a decision by that time.
Lord HARMAR-NICHOLLS: My Lords, is the noble Lord aware that I can well understand Boyle settling what any rate might be if any rate is settled? However, I should think that the principle of whether something ought to be done is a matter for the Government, not for Boyle.
Lord SHEPHERD: My Lords, of course it is a matter for the Government, and the reason why the Government sent it to Boyle was because there is a deep dilemma about this matter. If the principle were accepted that Members of Parliament who had left another place before the
1176
pension scheme became operative and had made no contribution, should suddenly be brought into the scheme, the ramifications would be immense throughout the country, or else Members of Parliament, whatever their experience or length of service, would be treated differently from the general public. If we get into a matter of principle, then things become difficult.
Lord DAVIES of PENRHYS: My Lords, could my noble friend tell me why a Member of Parliament is paid 11·8p per mile car allowance when a Member of the House of Lords, using the same car, has an allowance of 10·2p per mile?
Lord SHEPHERD: I could, my Lords, but I will not because it does not arise from the original Question on the Order Paper.
Lord BALFOUR of INCHRYE: My Lords, the Minister referred to those who have made no contribution. Can he explain to me what happened to the £30 a year which the noble Lord, Lord Boothby, and many other noble Lords, subscribed for many years towards Members' pensions? We have never seen any of it or heard anything more about it.
Lord SHEPHERD: My Lords, the noble Lord, having been in another place, has had a privilege I have not shared. He will be aware that the contribution which he and his noble friend made was to a fund which was set up to deal with hardship to Members and their widows and existed before the pension scheme was brought into operation. Therefore, I suggest to the noble Lord that he checks his figures before, if I may say so, a sense of allegation of unfairness is brought in.
Lord INGLEWOOD: My Lords, reverting to the reply to the previous question, regarding the contribution to the new scheme, may I ask whether the noble Lord can confirm that the contributions to the new scheme in no way pay for the pensions? The contributions are simply a small fraction. Can the noble Lord tell us to what extent it is funded as a result of these contributions, and how much is funded by direct contribution from the taxpayer?
Lord SHEPHERD: My Lords, I do not have those figures with me. I will communicate with the noble Lord on that. It is in line with what is normally contributed by persons in an occupational pension scheme. I will provide the necessary material for the noble Lord. My Lords, we have spent 18 minutes on two Questions.
Several noble Lords: Hear, hear!
Lord SHEPHERD: Fortunately, my Lords, for once I have your Lordships with me. Next Question!

BERMUDA AGREEMENT: RENEGOTIATION
2.55 p.m.
The Earl of LAUDERDALE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they consulted the British air transport industry before calling for renegotiation of the Bermuda agreement.
Lord ORAM: My Lords, the decision to seek renegotiation was taken in the national interest to improve our balance of payments. The Government keep in close touch with the British air transport industry and, although it was not directly consulted, the airlines most concerned were informed prior to the announcement. Now that the need for confidentiality is passed, consultations have been held at senior level with both British Airways and British Caledonian.
The Earl of LAUDERDALE: My Lords, in thanking the noble Lord for that reply, may I ask whether he does not consider that very serious interests were at risk in the airlines being informed instead of being consulted before these negotiations were entered upon?
Lord ORAM: My Lords, the Government were in touch with the airlines concerned and the Government were fully informed of the problems and needs of the airlines in the North Atlantic market. It was the decisions on timing and tactics in
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relation to the renegotiation of the treaty which were essentially for the Government to take.
The EARL of LAUDERDALE: My Lords, in thanking the noble Lord for that answer may I ask a further question? Is he not aware that British Caledonian have made it clear that they were simply told 24 hours before the announcement, and that this announcement put at risk the licence they already had received from the Civil Aviation Authority to inaugurate a service to Houston and Atlanta next autumn?
Lord ORAM: My Lords, I know there is some dissatisfaction in the quarter to which the noble Earl refers. I think the principal need for us now is to have an eye on the future. British Caledonian are fully with the Government about the need for the renegotiation, and the Government are well aware of the needs and hopes of British Caledonian, so I hope the noble Earl will agree that we should look forward to the negotiations in a positive spirit.
The EARL of LAUDERDALE: My Lords, I appreciate the noble Lord's answer and the style in which it is given. Would he consider asking his right honourable friend to press that the question of the service to Atlanta and Houston might be treated outwith the renegotiation of the Bermuda agreement proper, otherwise that prospect will be at risk by the very fact of having the renegotiation?
Lord ORAM: My Lords, I doubt whether it could be taken as a separate issue. It is one of the main parts of the negotiation. I recognise that the year that lies ahead is a short period. Nevertheless, as I told the noble Earl last week, the preliminary meetings have been satisfactory and we feel that in the coming six months a good deal of isolating or identifying the issues will take place and we hope that the two routes can be negotiated in time for British Caledonian's plans to take effect.
Lord ORR-EWING: My Lords, is the noble Lord aware that there has been a recent Government statement that they believed in the mixed economy, and a mixed economy entails equal and fair

1179
treatment for those in the public sector as well as those in the private sector? Is he further aware that it is not fair and equal treatment if they consult British Airways and merely inform British Caledonian? This is not fair treatment as advocated in the recent statement; and there was the recent example in the case of Laker Airlines as well. The Government are very vulnerable on this point. I hope he will put it right at the earliest opportunity.
Lord ORAM: My Lords, in a mixed economy I accept the need for fair treatment of all sectors of it, But a point which I think the noble Lord misses in this connection is that the Bermuda agreement deals with scheduled flights and British Airways were the only airline operating scheduled flights. So there was a distinction in relation to the two airlines in that respect. But reverting to my point about looking to the future, the needs of both airlines are very much in the minds of the negotiators, and I hope that we can all use our efforts in the interests of both sectors of the airline industry.
Lord MERRIVALE: My Lords, will the Minister agree that the negotiations are likely to turn on the imbalance between the British and United States shares of traffic, the designation of more than one United States airline on a route and "beyond homeland" traffic rights? Also, in view of the contentious issues involved, will the noble Lord agree (I assure the noble Lord, Lord Shepherd, that I am not reading at the moment) that these negotiations are likely to be very protracted and it therefore seems highly unlikely that, as was laid down in the White Paper of February, British Caledonian will get these rights as from next autumn, so it would be better if the issues were taken separately?
Lord ORAM: My Lords, I accept that there are tough negotiations ahead, and I merely repeat that we fully intend to negotiate on behalf of British Caledonian in respect of the Houston and Atlanta routes. The agreement has been working to Britain's disadvantage, which is the reason why we believe it should be renegotiated. When I say "Britain's disadvantage", I mean the whole of our
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airline industry, and I do not see a possibility of separating out one interest in what the noble Lord himself agrees to be a complicated series of negotiations ahead.

DISABLED HOUSEHOLDERS AND RATING RELIEF
3.2 p.m.
Lord CAMPBELL of CROY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will introduce the necessary amendments to the relevant Acts for England and Wales and for Scotland to allow appropriate rating relief through reduced assessments when disabled householders have had to make alterations to their dwellings, lowering their value, to suit wheelchairs or other essential equipment.
Baroness STEDMAN: My Lords, no amendment to rating legislation is needed to provide rating relief in the circumstances mentioned in the noble Lord's Question. If the works carried out by a disabled householder reduce the letting value of his dwelling, that reduced value would become the basis of the rating assessment.
Lord CAMPBELL of CROY: My Lords, I am grateful to the noble Baroness for that Answer. But is she aware that the interpretation of the present law proved exceedingly difficult in cases heard earlier this year? The Court of Appeal decided in one way and your Lordships' House, in its judicial capacity, decided in the other. Further, the noble and learned Lords concerned criticised the wording of Section 45 of the General Rate Act as ambiguous and labyrinthine. Since the costs of encouraging severely disabled persons to live in their own homes are infinitesimal compared with the costs of keeping them in hospitals or institutions, will the Government give high priority to short amending legislation to deal also with cases where the value is not reduced?
Baroness STEDMAN: My Lords, I accept all that the noble Lord has said about the recent judicial pronouncement, and it has certainly raised problems for

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the Department. The extent of the relief is the matter which was relevant to the decision of the House in the Van Dyke case. The Government are now examining the implications of the judgment to decide whether the existing position needs to be legislated for. This is a matter between the Inland Revenue and the Department of the Environment. Both Departments are now working together, are taking counsel's advice and my right honourable friend in another place has promised a Statement very shortly.
Lord WADE: My Lords, while it is true, in theory, that the lowering of value should lead to reduced assessments, will the noble Baroness agree that it is a very slow and hazardous process, and would it not be more helpful to disabled persons if some form of direct grant could be made in these cases?
Baroness STEDMAN: That, my Lords, is another question.
Lord CRAWSHAW: My Lords, can the Minister answer the second part of my noble friend's supplementary question, and take it from me that disabled people would be greatly encouraged and enabled to live in their own homes if they had some kind of relief in this direction, instead of being put in places maintained at public expense where they indirectly obtain rating relief?
Baroness STEDMAN: My Lords, Section 45 allows for certain relief on structures that are supplied for the accommodation of invalid chairs or other vehicles, for structures supplied to persons under the National Health Service for the prevention of illness, for structures supplied by local authorities for the welfare of the blind, deaf and dumb and structures of that kind. Section 45 also provides that even if the improvements enhance the rateable value, that is not taken into account when the assessment is made. But I would ask noble Lords whether they would wait for the review which is being carried out by the two Departments, and for my right honourable friend's Statement.
Lord GOODMAN: My Lords, in view of the inevitable delays before the administrative question is resolved, will the noble Baroness ensure that the local rating authority is encouraged to
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proceed on the basis of her first Answer, which is to give such allowances pending the question being resolved. I am sure she will agree that, as has already been said, it is of immense importance that disabled people should be encouraged to stay in their own homes. This is not only a question of economy; it is a question of humanity.
Baroness STEDMAN: Yes, my Lords.

PARLIAMENTARY AND OTHER PENSIONS AND SALARIES BILL
Brought from the Commons endorsed with the certificate of the Speaker that the Bill is a Money Bill within the meaning of the Parliament Act 1911; read 1ª, and to be printed.
RENT (AGRICULTURE) BILL
Brought from the Commons; read 1ª and to be printed.

TRINIDAD AND TOBAGO REPUBLIC BILL [H.L.]
Lord GORONWY-ROBERTS: My Lords, I understand that no Amendments have been set down to this Bill and that no noble Lord has indicated a wish to move a manuscript Amendment or to speak in Committee. Therefore, unless any noble Lord objects, I beg to move that the Order of Commitment be discharged.
Moved, That the Order of Commitment be discharged.—(Lord Goronwy-Roberts.)
On Question, Motion agreed to.
Then, Standing Order No. 43 having been suspended, pursuant to the Resolution, Bill read 3ª, and passed, and sent to the Commons.

FINANCE BILL
3.8 p.m.
Lord JACQUES: My Lords, I beg to move that this Bill be now read a second time. The practice of the House in relation to the Finance Bill varies from year to year. More often, we take it formally and we have a Motion on the Order Paper which gives rise to a wide-ranging debate on economic affairs. On this occasion, we have had general debates on economic

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affairs in June and again in July, and no such Motion appears on the Order Paper. Another practice of the House is to deal with the Second Reading in the usual way rather than in the formal way, when there has been a fundamental change in taxation. For example, last year when the capital transfer tax was substituted for death duties there was a full-scale debate on that aspect of the Bill. On this occasion, I would say that the fundamental change in taxation is the development land tax. That is the subject of a separate Bill and it has already been debated by the House. Therefore, left with the assumption that the House, having heard the Statement of my right honourable friend last Thursday, wants an opportunity of discussing that Statement, and that tacking will be discussed incidentally, I shall try to lead the debate along those lines.
My right honourable friend the Chancellor of the Exchequer concluded that sufficient progress had been made with the annual survey of public expenditure to enable some conclusions to be reached, and having reached those conclusions he felt that it would be to the advantage of all concerned if an announcement were made before the Recess. The studies that have taken place since the Budget have shown that recovery, both worldwide and in the United Kingdom, is moving at a rather faster rate than was contemplated at the time of the Budget. For example, during the next 18 months it is anticipated that the gross domestic product of the United Kingdom will increase at something like 5 per cent. per annum; that exports will increase at 11 per cent. per annum; and that manufacturing production will increase at 9 per cent. per annum. All these figures are somewhat higher than those that were contemplated at the time of the Budget.
On the employment front, the number of vacancies continues to increase, although there have been fluctuations. Short time working is declining; overtime is increasing; and by reason of the facts that I have given we expect the unemployment figure to fall before the end of the year. The growth of the money supply has been kept under control, and during the year to mid-June M3s rose by only 9 per cent. The money supply continues to exert a downward pressure on prices. During the last year the rate of inflation
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has been reduced to one-half, thanks mainly to the pay agreement in the first year and the £6 limit. The restraint in the second year of an average pay agreement of 4½ per cent. is more severe and we expect an even greater effect.
In the meantime, however, the depreciation of sterling by 12 per cent. since March and a slight movement in the terms of trade against manufacturing countries are beginning to affect our retail price index. It is anticipated that instead of having a single figure rate of inflation by the end of the year, the rate is likely to be in the neighbourhood of 12 per cent. In 1975 the external current account deficit was halved, but it was still £1·7 billion. In the short term, the depreciation of sterling tends to increase our deficit; but in the long term, with the growth of exports and the substitution of our own goods for imports, it should greatly reduce our deficit. This, I believe, is the nub of the question. We must plan now in order drastically to reduce our external current account deficit next year.
By deficit budgeting and special grants we have saved 250,000 jobs or training places during the depression, but as recovery proceeds it is vital that we should gradually reduce our deficit on public expenditure. This must be reduced so that private savings are made increasingly available for stock building and investment by the private sector, otherwise we risk an excessive growth in the money supply. This we ought to avoid at all costs. An excessive growth in the money supply next year in order to finance private investment, even manufacturing investment, would refuel inflation and almost certainly lead to a sucking in of imports. Then we should be back to the well known pattern of "stop-go".
We have taken firm action in the current year to prevent public spending from exceeding the planned limits. At the time of the Budget it was expected that the amount of the deficit for the current year, 1976–77, would be £12 billion. We can now say that it will be somewhat less; namely, £11.5 billion. Recovery alone will reduce this deficit to £10.5 billion next year, but we consider that that is not enough. Accordingly, my right honourable friend in the other place made recommendations to Parliament in order to reduce the deficit to £9 billion.

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If we make a study of the Statement I think we can come to the following conclusions so far as the cuts are concerned. First, we have preferred selectivity rather than an automatic cut across the board. We believe that there must be a certain amount of flexibility in a manoeuvre of this kind. Secondly, in accordance with our often declared policy of giving the maximum protection to the least well off in the community, the main social benefits—for example, pensions—will remain untouched. In particular, the up-rating in November will take place. Thirdly, in keeping with the part we have taken in the Councils of Europe and in the Councils of the United Nations we shall not cut the aid to underdeveloped countries. Fourthly, the cuts are devised to have the minimum effect upon employment and prices. Fifthly, the cuts are so devised that our programmes, particularly the programmes in education, in the National Health Service and in defence are not seriously impaired. Finally, the cuts are designed to have the greatest effect upon those industries which are likely to benefit from investment by the private sector.
There are a number of points which are of special interest. I think that all Members of the House will be pleased to see that, despite the stringency, we plan to give further aid for the employment of young people and that an announcement will be made on this matter before the Recess. Secondly, the lady Members of the House will be glad to see that the regional employment premium rate is to be the same for both men and women. Thirdly, I am very pleased to see, and I am sure that the noble Baroness, Lady Seear, will also be pleased to see, that we have provided for a contribution to any scheme for the collective funding of apprenticeships. The noble Baroness may tell me that it is too little and too late; but I would point out that we have spent vast sums of money upon protecting apprenticeships during the depression, that we have more than doubled our provision for training in real terms, and that we have made increased contributions to the scheme which aids the mobility of labour. Therefore I suggest that it is not too little and that it is not too late; it is additional.
Fourthly, there will be a restriction of unemployment benefit for those who are
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in receipt of substantial occupational pensions. I am sure that noble Lords on this side of the House, and I hope noble Lords in other parts of the House, will be pleased to note that this change is being made. Unemployment benefit is to help temporarily those who are seeking work. Many of those who have retired early and who are in receipt of substantial occupational pensions are not seeking work and should not, in any fair system, have unemployment benefit. I am very glad that action has been taken to make it more difficult for them to get the benefit.
Lord DRUMALBYN: My Lords, if I may intervene I should like to ask the noble Lord whether it is not a condition of receiving unemployment benefit that they should be seeking work, and does this not mean that the rules are not being strictly applied?
Lord JACQUES: My Lords, it is sometimes easy to have rules and more difficult to apply them. This is one of those cases. I can pinpoint many cases where there was no excuse whatever for unemployment benefit being paid. I can even quote the case of a town clerk who retired early.
Lord HOUGHTON of SOWERBY: My Lords, if my noble friend will allow me, may I ask this question. For the same contributions, does not the person in receipt of an occupational pension have the same contractual right to unemployment benefit as anybody else?
Lord JACQUES: My Lords, unemployment benefit is intended for those who are genuinely seeking work. Many of these people are not genuinely seeking work and I am pleased that the contract is being changed so that they will not receive the benefit. This is the one thing I am prepared to defend with my life. I retired at 60 and between the ages of 60 and 65 I happily paid the contribution rather than claim any benefit because I would not genuinely have been seeking work, and what I can do other people can likewise do. Many of them are better off than I have ever been. The total saving as a result of these cuts is £1,012 million and this will reduce the public sector borrowing requirement by £800 million.
I come now to the second important factor in the package which was put forward by my right honourable friend

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and that is the increase of two percentage points in the employers' contribution to National Insurance. I think all experience has shown that when there is a general charge for the whole of industry it does not take long for that charge to be reflected in market prices. That is certainly my experience in managing a business. Therefore, I would expect that before long it would be the consumer who pays, and consequently we have said that we would expect this to affect the retail price index by something like 1 per cent. Secondly, I would point out that the 12 per cent. depreciation of sterling since March will give adequate protection against competition from imports and it will also protect our export competitiveness.
Next I would point out that this change will bring us more into line with the other Member States of the EEC. Almost without exception the other Member States have higher contributions and taxes on employers in proportion to their total taxation. This is another step to bring us into line with them. The total of this saving will be £910 million and will reduce the PSBR by £700 million, and the £700 million plus the £800 million which I have just mentioned gives the one and a half billion pounds required. The PSBR as a percentage of the gross domestic product was 10 per cent. in 1975–76. In the present year it is 9 per cent. As a result of this package, next year it will be 6 per cent., and if we exclude the on-lending to public corporations and to the private sector for their capital programmes then the percentage of the PSBR to the gross domestic product is only 6 per cent. in the current year and as a result of this package it will be reduced to 3 per cent. next year.
I wish also to point to some of the changes which are being made in the Price Code since we last considered it only a few weeks ago. The proposed allowance for investment, which was being raised from 20 per cent. to 35 per cent., is now going to be raised to 50 per cent. So that step by step this Government have increased the allowance for investment from nothing to 50 per cent. in the Price Code. There is a similar allowance in respect of depreciation. Your Lordships will remember that when we considered the White Paper, The Attack on Inflation earlier this month it was stated that, for
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the purposes of the Price Code, if a company had revalued its assets in its balance sheet then depreciation would be based upon the revaluation. If it had not so revalued and was taking depreciation at the historic cost it would, for the purposes of the Price Code, be increased by 30 per cent. It is now announced that it will be increased by 40 per cent.
I should like to say a word to those who feel that no action should be taken other than import control. First, I would point to the fact that the reduction in the PSBR from recovery alone would not be enough. We must have further saving than that if we are to be sure that private savings are going to be available for the financing of stockbuilding and for reinvestment, bearing in mind that it is the Government's intention under all circumstances to keep the growth of the money supply under control, because otherwise we believe it would refuel inflation and suck in imports.
Secondly, I would point out that when the exchange rate of the pound sterling was fixed there was a case for having some general control of imports in a time of depression. Now we have the floating pound which automatically gives some protection. There is therefore much less case for having general import control in a time of depression. Furthermore, it would invite retaliation in the way it has never done before if we were to have such control in addition to the automatic protection which the floating pound gives. With the floating pound any protection of imports must be on a selective basis and in this connection the present Government have a very good record. We have negotiated agreements which give selective protection against imports in textiles, in footwear, in wood and paper products, in printing machinery, clocks, pottery, portable radios, electrical components and so on. In all those cases we have negotiated agreements which will protect our industry. In addition, in his Statement my right honourable friend specifically said this:
"We are anxious to discuss with both sides of industry the need for any further action there may be."
Finally, I should like to say a word to those who believe that we should have taken much stronger action. I believe such people undervalue the Social Contract; I believe they undervalue the significance of the pay agreements which

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have flowed from the Social Contract. I believe also that they undervalue the better industrial relations which have accompanied the Social Contract. Without those this country would have been in a much more serious economic position than it is today. Do not let us sacrifice them. I beg to move that this Bill be now read a second time.
Moved, That the Bill be now read 2ª—(Lord Jacques.)
3.29 p.m.
Lord CARR of HADLEY: My Lords, this debate is of course formally on the question of granting a Second Reading to the Finance Bill, but even before knowing about the Chancellor's measures we had indicated that we would like this debate to go somewhat wider. Of course, we think it even more important now, and so I strongly welcome and agree with the noble Lord's own speech in which he devoted himself almost entirely to these economic measures. I intend to do the same, but I want to say a few words first about the Finance Bill.
After 26 years in another place it seems strange to have a Finance Bill in front of me and not be able to get at it and seek to amend it. I do not know why we loved doing that because it was a painful and tedious process, but it was some sort of compulsive reaction that Members of Parliament have. On the other hand, when I cannot do that I realise that I am compelled to look at the Bill more as a whole. I am sorry to be rude about it, but when I look at the Bill as a whole the outstanding impression I get is one of sheer incompetence; in the way the Bill was prepared and put together and in the technical failure, "incompetence" is the only word for these initial proposals.
The original proposals outlined in the Finance Bill as introduced by the right honourable gentleman the Chancellor of the Exchequer now look as
though they have been hit by a bomb. True, the TUC clauses, which were originally contingent on a pay-deal agreement, have been passed in their original form. Personally, I welcome that, as I think does the great majority of people. Also, the capital transfer tax changes have gone through more or less in their original form. But I must remind the House that those capital transfer tax clauses were themselves
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evidence of the incompetence of last year's Finance Bill, because they are almost all implementing the changes which the Opposition pressed in last year's Finance Bill, which they were then told by the Chancellor of the Exchequer and his colleagues were either impossible or undesirable, or both.
The two principal appalling sections in which the Government deliberately set out to turn the screws of the tax system on the business sector and on the self-employed—namely, the fringe benefits and the investigation powers—have emerged as barely recognisable as a result of all the Parliamentary blasting they have received in another place. The changes in the fringe benefit proposals have been really beneficial. All I will say in passing is that it is both interesting and healthy that opposition to the original proposals came just as strongly from the trade unions as from the Institute of Directors.
The changes in the snooping powers have also been substantial but not, in our opinion, nearly substantial enough. We still object to them strongly, and I sympathise very much with the feelings of my noble friend Lord Harmar-Nicholls about them. I must not encroach on what will be a separate debate on the Motion of my noble friend Lord Harmar-Nicholls, but may I briefly say now that while I feel that, since the Speaker has given his ruling about the Bill I doubt that it would be wise to proceed against it in this Bill. So far as I understand the matter, I think my noble friend may possibly share that view with me. Nevertheless, I feel strongly, and want to say that I feel strongly, that this House should find an effective way, outside this Bill, of looking into the increase of arbitrary powers of inquiry into the private affairs of citizens in ways which are highly objectionable and dangerous, not just to privacy, but to personal liberty itself. I am not referring just to this Bill nor, let me assure the House, merely to clauses included in Bills introduced by Labour Governments. Both Governments have been slipping down the dangerous path here, and it is time that Parliament—and I hope this House will play a big part in this—brought an end to the process and reviewed how much we should take a step backwards before too much damage is done.
I now wish to leave the Finance Bill, and to turn to the economy in general.

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Before coming to what I wish to say principally, may I comment briefly on two points raised by the noble Lord, Lord Jacques. There is one point about which 1 think I must fire a strong warning shot across his bows. When he started talking about the comparability of the general Government deficit, to use the Chancellor's new phrase, with that in other countries, he said it was now comparable if you exclude our funding to nationalised industries and to private industry. But what an exclusion. To look at the financial arrangements of this country and the appropriate size of the public sector borrowing requirement and to think you can compare Britain with other countries when you have excluded that element—all I can say is, Heaven help us in the running of our economy in future if such an exclusion is to be made.
Lord JACQUES: My Lords, I was really suggesting that it should be excluded when compared with other countries where it is excluded.
Lord CARR of HADLEY: My Lords, what is the scale in other countries compared with the scale here? It is probably excluded in most other countries almost on de minimis grounds compared to here, and if the Chancellor is going to try to make this phoney comparison in future he will not be allowed to get away with it without a lot of comment.
The other thing I want to say, which is important, but which is less fundamental to our whole economy, is with regard to what the noble Lord said about the proposals to deal with people over 60 in receipt of substantial occupational pension schemes. We looked at this when in Government, and I have considerable sympathy with the general approach of the noble Lord, but he surprised me in one thing. I wonder whether he realised what a severe attack he made on the way in which this scheme is administered, because he said in effect that the officials administering this scheme were failing, hopelessly failing, to apply the rule that, in order to qualify for benefit, you should be genuinely seeking work. This is what this country wants to see. The country wants to see that rule applied. We want to see
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it applied, of course, to people over 60, and to everybody, because while this country wants to be generous in helping those who wish to seek work and cannot get it—and I should like to be more generous rather than less generous to those people—we increasingly suspect that we are spending a lot of money subsidising people who are not genuinely seeking work. This applies throughout the age scale, not simply to people over 60 who happen to have occupational pension schemes.
To come to the main issue of the proposals of the Chancellor of the Exchequer, when they were repeated to this House last Thursday I immediately welcomed them on behalf of the Opposition as a step in the right direction. I want to repeat that welcome today. It was becoming unbearable to watch this country's economic strength being allowed to bleed away while the Government stood by, refusing to apply the tourniquet whose use was so obviously necessary to everybody else but them. That is why the country's blood pressure, that is to say, the international value of the pound, has fallen to this terrible, dangerous and unnecessarily low level. Any action to stem the flow was to be welcomed; we do welcome it, and repeat our welcome. But after a few days in which to consider the measures in detail, it is right and necessary that we should judge them more critically. The more one looks at them, the more inadequate and inept they seem to be in the economic terms of both what is necessary to put our economy to rights and what is necessary to restore confidence abroad and for our capacity to do so. I do not want to be a Jeremiah but I am convinced that further action will be necessary; and this action which we have now, having been left to this late hour, is now on its own too late to be anything like sufficient. Moreover, the action is wrong-headed and perverse in several important respects.
In order to form a proper judgment necessary to establish the yardsticks by which to measure what is needed I want to speak simply about one or two certain basic principles. The economic problems facing Britain are, in many respects, very difficult and complex. I assure the House that I will not try to read an economic lecture; I was almost going to say that, thank goodness, I am incapable of doing so. But underlying the complexity there

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is a basic simplicity, which is that as a country we are living far beyond our means. The extent to which we are doing this is horrifying. I had thought that we were borrowing £1out of every £5 we were spending, and I found that terrifying enough. But last week the right honourable gentleman the Prime Minister said that in fact we were borrowing £1 out of every £4 that we were spending. This cannot go on. Every sensible person of whatever political Party in this county knows it cannot go on. To borrow for productive and essential public capital investment is one thing. But we are borrowing on this scale, to a large extent, simply to pay for our current level of consumption and to maintain normal public services at their present level, and this must stop, however painful it is in the short run.
So, my Lords, what do we have to do? Two things, I believe. First, urgently, in the short run we must cut our coat according to our cloth; that is, we must cut down our standard of living to what we can afford. That is the negative and harsh part of it. Secondly, for the longer term, we must take strong and urgent measures to increase our means for the future, so that we can afford to live within our means in the future at the standard we all desire. Action under both headings is necessary, and the Chancellor's measures need to satisfy both those tests. My submission is that they fail to do so.
If we are to meet the second test—that is, if we are to increase our means for the future and create the extra national wealth by which alone we can maintain, let alone improve in the future, our present standard of living—then we must devote more of our resources to exports and investment. It follows that in the short term we must make ends meet by cutting back on our consumption; that is on our everday standard of living. This can obviously be done in two ways, and it is very simple, but I believe we have to talk to the people of this country in rather simple terms if we are to get their backing and understanding. It can be done in two ways: first of all, by restraint on our demands for personal income spending; secondly, by cutting back on the services and benefits provided for us by the State; that is, cutting back what the Government like to call the social wage.
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Of course, our individual personal consumption must make its contribution. Hence the vital importance of restraint in pay increases and therefore of an incomes policy. I criticised severely the Government's irresponsibility in letting pay increases run wild—there was no other description—for their first 18 months in power. That is a direct cause of the present high levels of both unemployment and prices. But for the last 12 months the Government have been dealing with this matter in a serious way which deserves support, and I take this opportunity of reaffirming my strong support in principle for the present incomes policy. It is essential and will remain essential in some form indefinitely.
But restraint in personal consumption cannot bear the whole burden. It would neither be right to make it do so nor would it be practicable to try to make it do so. If we are to make ends meet and at the same time put more of our resources into productive investment and exports, a large part of the cutback must come from the public sector; that is, from what is called the social wage. This is a hard reality, but there is no easy way out, and I am afraid I feel the Chancellor is still trying to dodge it. The Chancellor proposes to reduce expenditure in 1977–78 by £952 million and to increase revenue by £910 million, thus making a crude cash saving on the borrowing requirement of £1,862 million. But out of this crude saving only about £550 million—that is, only about one-third—is in resources of manpower, goods or services absorbed by the Government, and the remaining £1,300 million, or roughly two-thirds, falls exclusively on the private sector, on its profits, incomes, spending, production and employment.
Look at the Chancellor's cuts another way and judge them by the Chancellor's own yardstick. In his Budget speech on 6th April this year the Chancellor said that we can achieve full employment together with external balance:
"…only if we produce a major shift in the use of our resources away from private and public consumption towards exports and investment". —[Official Report, Commons, 6/4/76; Col. 239.]
But the Chancellor's proposals cut over £400 million off public investment while cutting current public consumption by the much smaller figure of £136 million; in other words, the Chancellor in his make-up

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of this package stands utterly condemned by the very yardstick which he himself established only three months ago in his Budget speech.
I would ask you to look at the Chancellor's cuts in another way again; namely, in their effect on employment. The Chancellor estimates that the effect of his measures will add 60,000 to the number of people unemployed by early 1978. Some people say that it will be much more, but let me take the Chancellor's figure of 60,000. I want to ask the Government— and I hope the noble Lord the Leader of the House will deal with this in his reply—where will this unemployment fall, where will this extra 60,000 unemployed fall? I am going to suggest where I believe it will fall, but I specifically ask the Government to break this figure down sector by sector, particularly if they wish to disagree with the version I am going to give.
I do not want to make anyone unemployed in any sector if it can possibly be avoided, but if it is really unavoidable, surely we would all agree that this temporary, desperately sick-making and unpleasant hardship must have a constructive purpose behind it. That purpose must surely be a reduction of employment in the non-productive public sector and lead to an increase in jobs in productive work. That is not to say that work in the public sector is bad in itself; of course it is not. What I am saying is that we are doing more in that sector than we can afford at the moment, and we must get that transfer of resources. In fact, however, the Chancellor's expenditure cuts, so far as I can see, will leave the Civil Service and local government employment virtually untouched, while throwing far the greater part of this extra unemployment on the building and construction industries, which are already severely depressed, at least in terms of future orders.
I say to your Lordships that this is crazy in economic terms as well as being grossly unfair in social terms. Moreover, the other half of the Chancellor's proposals—that is the increase of £1,000 million a year in the taxes on industry—will also cause unemployment, mainly in the private productive sector. It is impossible to quantify, but it is bound to cause some
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unemployment, mainly in the private productive sector. Again I suggest that this is both socially unjust and economically crazy. This part of the Chancellor's proposals is, in our opinion, due to be severely condemned.
As I said earlier, we must now learn to live within our means and cut our coat according to our cloth. We must make the cuts which are necessary in the short term in a way which will encourage the creation of more national wealth in the longer term. To slap an extra £1,000 million a year in taxes on business costs at the present time will have an exactly opposite effect. It is bound to make industry's immediate investment lower than it would otherwise have been, because some of the extra cost is bound to come out of industry's profitability. It is bound to cause some loss of jobs in the productive sector. If we in Britain are to have full employment in the future and to enjoy a standard of living comparable to that in other industrial countries, we really must now make the creation of new national wealth our priority and drop our obsession with redistributing wealth which we have not got. The Chancellor, in my submission, is still failing to do this.
Before leaving the substance of the cuts, may I say in passing that I welcome the fact that there is to be no reduction in the overseas development budget. Although we are faced here at home with having to take cuts in our own standards of living, our own standards of living will still be unimaginably high by comparison with those in the poorest of the Third World countries. I believe on grounds of Christian morality, or any basic morality, but also in the long run on the grounds of our own self-interest as a country, that we must be prepared to make some sacrifice year by year in our own standard of living to try to help, however inadequately, the raising of standards in the Third World.
Finally, moving from the strictly economic impact of the measures, I want to say something about the almost equally important psychological impact on public opinion at home and on confidence abroad. First, on public opinion at home, I am convinced that the majority of people now realise that we cannot go on living beyond our means, that hard measures are necessary, and they will accept and support

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them provided that the Government speak, with complete honesty, and that, however hard the climb back for us may be, they believe that the sacrifice is being demanded and designed for a constructive, hopeful purpose in the long run.
I am afraid that I do not feel, nor do I believe that the country feels, that the Government have hitherto been speaking with complete honesty. It was not honest, for example, for the Chancellor to say so strongly earlier in the year, and in his Budget, that such further expenditure cuts as we are considering now were unnecessary for the next year, when he must have known that they were, or, if he did not actually know that they were, he must have known that the probability for their necessity was pretty high. But to have obtained the agreement of the TUC to Stage 2 of the pay policy on those terms, and then, within a week or two, to start preparing cuts of this size does not, I believe, appear to be talking to the country with true honesty. If some of those people feel instead that they have been the subject of a "con" trick, they are not, I think, altogether to be blamed.
Nor do I believe that large numbers of people will readily accept some of the cuts which will hurt them personally, when they see the Government still increasing expenditure in other ways which they do not want, which they know will not help them as individuals, and they do not believe will help the prosperity of the country as a whole. Take this vexed question of nationalisation. I disbelieve in it; I accept that noble Lords opposite believe in it. But whether you believe in it or not, is this the moment? The Community Land Act is expected to cost £350 million in a full year; the nationalisation of the shipbuilding and aerospace industries, £550 million, making a total of £900 million— almost the total cuts for which the Chancellor is now asking.
Move to smaller areas. In health and social services £20 million is now being cut from the capital spending of the NHS. But £40 million is being added to the cost of the NHS by the abolition of pay beds. Even those who want to get rid of pay beds might prefer to wait a little rather than suffer the capital cuts at the same time.
Lord BROWN: My Lords, may I interrupt the noble Lord? Surely he
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knows the difference between current and capital expenditure? To go on confusing the country by treating them both in the same voice is really as dishonest as he is suggesting the Chancellor is.
Lord CARR of HADLEY: My Lords, I do; it is the Chancellor who does not know the difference. The whole burden of my complaint is that the Chancellor is muddling up the two. The Chancellor is making £400 million of his cuts in capital expenditure and mixing those up with current expenditure, and it is therefore perfectly valid for me to mix the two up together, because if the Chancellor separates them 1 will separate them. I will put to the noble Lord, is it fair or is it not fair to regard as a capital item the cost of nationalisation?
Lord BROWN: Yes, it is.
Lord CARR of HADLEY: Will the noble Lord then admit that some people would rather make some saving on the capital side on nationalisation in order not to have to make some capital sacrifice on the National Health Service, on schools and the like? If we are comparing capital expenditure with capital expenditure, I am quite sure that the great majority of people in this country would rather have more capital expenditure on hospitals and schools, and facilities of that kind, which really matter in their lives, and less capital expenditure on nationalisation.
Lord SHEPHERD: My Lords, if I may intervene, would the noble Lord agree that we ought to square the box? If the noble Lord is right, and to some extent he is right about current and capital expenditure, would he not agree that if shipbuilding companies need to be bailed out by very many hundreds of millions of pounds in order that they be saved, then that would become current expenditure?
Lord CARR of HADLEY: My Lords, I will go so far with the noble Lord as to give him a preview of the speech I may have to make in September, to say that of course I accept that some of that £950 million will have to be spent in any case. But my case is that nothing like as much will have to be spent in order to achieve the necessary results if we did not embark on the full-scale nationalisation not just of the shipbuilding industry,

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which does need help with this money, but also the aircraft industry, which, in my view, does not.
Secondly, may I turn to the question of confidence abroad. The main cause of the collapse this year in the exchange value of the pound has been a chronic lack of confidence by those who have to hold and trade in sterling. I ask myself whether these measures will restore that confidence, and I am afraid I doubt it—at least not for long. I am afraid the early signs in the foreign exchange markets have not been all that encouraging. Why do I doubt it? Partly because of the critical analysis of the economic merits of the Chancellor's measures, which I have just given, and partly because confidence is an intangible asset which is affected greatly by attitudes and impressions as well as by individual acts of policy.
What our overseas creditors and all traders in sterling want is not so much dramatic measures; they do not demand sacrificial offerings from us for the sake of sacrifice. What they look for is evidence of a British Government whose deeds match their words, who know where they are going, and show the determination, willpower and stability of policy and purpose to get there. This is not the impression which has been created by this Government, nor is it being created now. The stubborn pretence for the first half of this year that these spending cuts were not needed, and would not be made, created the contrary impression. The emphasis on these cuts, now we have got them— on cuts in capital expenditure rather than public consumption—create the contrary impression. So does the imposition of a huge extra tax burden on industry. So does the Chancellor's failure to commit himself to a firm, longer-term programme for further reductions in the borrowing requirement beyond the next financial year.
Far from being steady and constant and firm in his policies and objectives, Mr. Healey, as Chancellor, has been a zig-zag Chancellor to exceed all other zig-zag Chancellors that there might have been in the past. Look at some of the examples of his zig-zagging. Take the jigging up and down of the VAT rates, with no stable or sustained industrial or economic purpose behind the changes.
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Take the severe strain on industry's financial resources which Mr. Healey imposed in March 1974, and then reversed eight months later after terrible damage had been done to industry's power to invest. Take the fact that in September 1974 Mr. Healey announced that the rate of inflation had already been cut to 8.4 per cent, and would certainly be within 10 per cent, at the end of 1975, when every informed observer abroad as well at home knew that this was nonsense.
Take, above all, the wild inconsistency of Mr. Healey's attitude towards the importance of the public sector borrowing requirement, which is the central subject of his latest measures. Two years ago he made a major plank of his first Budget his intention to make a major reduction in the previous year's borrowing requirement, which he criticised severely for being too large. But in practice, instead of nearly halving it, as he said he was going to do, he nearly doubled it to £7.6 billion. The following year he increased it again to almost £11 billion. This year he started the year by budgeting for it to be even larger at £12 billion. Now he comes along to reduce it with plans to cut it to a maximum of £9 billion. Of course he is now right, just as he was right in March 1974, but he has been terribly wrong in the interim.
How can people, particularly foreign holders of sterling, large traders of sterling, have confidence, in view of this past record, that this new policy is now to be firmly adhered to and followed through not only in 1977–78 but in subsequent years as well? Death-bed repentances seldom carry much conviction in this world however much they may command in the next, and if the Government really are to carry conviction at home and confidence abroad that they have changed their policy, that they really now are determined that Britain must live within its means, then I believe that the Chancellor—I do not by any means wish to belittle all that he has done or the courage he has shown on some occasions—should look deeply at the example set by his right honourable friend the Prime Minister in November 1967.
Then, too, a Chancellor had struggled hard but had to admit that there had to be a sea-change in economic policy, and he thought it right to resign the Chancellorship not only, or perhaps even mainly, as a

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matter of personal honour (because there was nothing to be ashamed of in what he had been trying to do) but, above all, in order to create confidence at home and abroad that the new policy was the real policy, and in the belief that one could not carry conviction by a new policy unless one also had new management. I say with regret, and not with any animosity, that I believe the Prime Minister and the Chancellor should consider that situation very carefully.
To sum up, my Lords, it seems to me that the cuts in public spending are to be welcomed as a step in the necessary direction but that they are insufficient in size and seriously wrong in their composition. Secondly, it seems to me that the imposition of an extra £1,000 million in tax on industrial and business costs is wrong and very damaging to investment confidence and to productive employment. Thirdly, it seems to me—and this answers the noble Lord's point about the severity— that while the reduction of £1½ billion in the public sector borrowing requirement is probably about as much as could be achieved, or ought to be achieved, in the next single financial year, this should all have been achieved by cuts in spending, without half of it coming from taxes, and also that the Chancellor should have committed himself irrevocably to further programmed reductions in the borrowing requirement in the years succeeding 1977–78.
For all these reasons I feel that the Chancellor's current package is unlikely to be sufficient on its own to re-create foreign confidence on a lasting basis. What we need is not necessarily a more savage cut in total in a single year, but the commitment to a firm programme which promises to reduce our borrowing requirement step by step over the next few years and to bring this about not by increases in taxation, not by cuts in investment, but by cuts in public consumption and by the transfer of manpower and other resources from the non-productive to the productive sector of our economy, accompanied by measures openly and deliberately designed to stimulate the creation of new wealth for the nation, including in particular cuts in our present punitive levels of personal taxation which now affect not just the people at the top of the salary scale but right through the salary scale in all forms and levels of employment.
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With such a firm programme for the next few years, Britain, I am convinced, would climb back steadily, even though slowly, to economic strength and prosperity, including full employment. But, I without it, I fear we shall continue to I slither from one crisis to the next, with high unemployment, a high rate of I inflation, and a standard of living for everyone steadily declining compared with that enjoyed in other major industrial countries. I beg the Government to follow up this first step, which we welcome with the kind of firm programme—an announced firm programme—for the next few years which I believe is essential.
4.4 p.m.
Baroness SEEAR: My Lords, the House will perhaps be relieved that in view of the fact that we have had a number of economic debates in recent weeks I do not intend to give an overall Liberal view of the economic scene, but rather to pick on certain specific points which have not been so greatly emphasised by either of the two noble Lords who have spoken this afternoon, and to ask the Government one or I two, I hope, pertinent questions. Before doing so, I should like to say that the suggestion which is coming perhaps as a Motion later from the noble Lord, Lord Harmar-Nicholls, raises an issue in which we on these Benches are also greatly interested. While we would not go along with the idea of sending this matter to the Committee of Privileges, we believe that it needs investigation, and as the noble Lord, Lord Carr of Hadley, has just said, we are not at all satisfied with the way in which matters of this kind have been developing over previous years.
Before raising the particular issues that I want to talk about this afternoon, I should like to say to the noble Lord, Lord Jacques, how relieved I was to hear today—as last week, when the question of cuts was first raised—that the Government are resisting the advice they have had from some more esoteric quarters of their advisers to bring in import controls. However, I was a little anxious when the noble Lord went on to justify what the Government had already done in the way of import controls as a reason for doing no more. That section of his speech seemed to me much to weaken his protestations that he disapproved of that

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line of advance. When he says that further matters in this area would be discussed with the TUC and with the CBI, I hope the noble Lord will remember that on this matter of import controls it is by no means only the producer interests in this country, be they employer producer interests or employee producer interests, that are concerned with matters of imports; it is also very much consumer interests which are concerned with matters of imports. Are there not a number of occasions, of which this is just an example, on which the consultations they have had with the producer interest should also have been extended to include what consumers wish to have done in this matter as well?
In looking at the Finance Bill in general and the economic issues which lie behind it, it is important to be certain that we are getting the right fundamental analysis as to what our problem really is. The temptation in these situations, all too easily fallen into, is to deal with symptoms of what is wrong with us without getting at the real causes. It seems to me that there are two matters with which we must deal. One of them has already been dealt with at some length by both speakers today— although I have a little I want to say on this matter—but the other has not so far been presented in the form in which I wish to present it.
The first matter is the obvious fact that expenditure in this country is gravely out of control and that action has to be taken to see that it comes within control. This is a situation in which we are not unique. The expenditure of other countries, including, for example, the United States of America, has become grossly out of control, and it is very easy in any democratic country for this to happen. The temptation to bribe the consumers, the voters, the big special interest groups with promises which require financial backing which is not in fact available, is a temptation to which all political Parties fall. So the need to bring public expenditure under control is of course the first and the obvious issue with which we are confronted. A very great deal has been said already by the noble Lords, Lord Jacques and Lord Carr of Hadley, in this regard.
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I want to make one or two points only, not because I do not think there are a great many other things to be said, but because we do not want the debate to go on too long and many of the points have been raised by previous speakers and many will be said by more than one of the speakers who are to follow me. In passing, I should like to say that it seems to me a pity that when the Government embark on a plan of economy they have to indulge in petty little meannesses which really make no difference worth speaking about to the sum total. I know that this in itself is a small matter, but why on earth, when the Government were going through the list of economies which they could make, did they see fit to delay for another 12 months the invalid housewives' allowance which they had promised to give? To have done this for a paltry saving seems to me quite extraordinary. One is tempted, perhaps unworthily, to believe that it is because there is no powerful, organised interest group to speak for that particular small group of persons whose savings will be lost in the general expending of money which goes on regardless. But that is in passing.
The major point I want to make reinforces and to some extent extends what has already been said about the need to look again, and to look far more fiercely, at both Whitehall and town hall. I do not believe that there is not still much room for further saving in both those directions. The percentage increase in white collar employees by Government since 1962 is 25, which is surely far too high. It is too high both in terms of the number of persons employed and the levels of pay. I know that this is a fiercely contended point, but I find my students going out to earn salaries which to me seem excessive; I am told by industrialists, who do not pay money away because they enjoy paying it away, that they are the kind of salaries that they have to pay to compete with what Whitehall is paying.
I cannot believe that this state of affairs is satisfactory. Nor do I disbelieve the industrialists. Why should I, when they tell me that Whitehall is pricing them out of the market? Why should I disbelieve them when, for example, I was told the other day on very good authority, who shall be nameless, that she had been present at a committee meeting—not a Whitehall meeting but a town hall one—at which a

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young woman of 25 was paid over £5,000 a year to be in charge of a department of needlework? I am not decrying needlework—I have no claim either to decry or praise it—but it seems to me that we are getting wildly out of proportion when salaries of that kind are flung about, and it is surely something that must be looked into. Noble Lords in all parts of the House appreciate what I am saying.
When it comes to town hall, I think we could adopt an approach that might in the end be very profitable, not only in economic but in political terms. I believe, with both noble Lords who have spoken, that at last the public as a whole realises that the big enemy is inflation. Indeed I believe that the general public, perhaps to a greater extent than the leaders, are aware of the threat with which they are faced; aware of the importance of solving this problem of overspending. For this reason, I say that if one talks to the ordinary ratepayers in the country one discovers that they know that there are all manner of excessive expenditures going on.
I believe, therefore, that if, at town hall level, a very tough limit was imposed—I applaud the fact that the Government are trying to be tough in this matter, and in my view the ratepayer is their ally against the official—and town hall was told to find ways in which economies could be made, and made in close consultation with ordinary ratepayers everywhere, economies would be made. After all, there are ward organisations of all the political Parties. If they were asked to come up with recommendations of how in their areas economies could be made, I believe that town hall would be weighed down with recommendations—some of them very foolish, no doubt—based on local knowledge.
We talk about participation. Let us get ratepayers in the wards, in the country, coming forward with their suggestions as to what economies could be made, for I am convinced that there is a very great deal of room for this. After all, the connection between expenditure in town hall and rates, even if it is not as close as some of us might like, is still very close indeed. And who knows better whether the services being rendered are really worth the money that is being paid for them than the, people in-those areas? I suggest that there is room here for a real participative
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exercise, which would have the benefit of being participative in itself and which could lead to some very substantial economies.
In discussing the question of Whitehall and town hall, I have not so far made any suggestions about the Whitehall end, and in this connection I wish to deal with one area. I have yet to meet anybody who disagrees with those who say that there is a layer too much in the Health Service. Some people say that we do not need the region, others that we do not need the area and some that we do not need either, but I have never met anybody who says that we need all the layers we have. I have not costed it, but there must be a considerable amount of waste money going into supporting an area in the Health Service which has no defenders. I do not know how it ever got in, but certainly nobody believes that it should stay in. I recognise that with all the disturbances there have been in the Health Service it would be a little much to disturb matters yet again, but when we are looking for economies we must not be too nervous about the way in which we stir up what might look to be hornets' nests but which may prove to contain hornets with very little sting when we come to ask the people in the country, who are benefiting but who are also paying for these services, what sort of economies they would like to see take place.
The task of finding ways to make both ends meet, of cutting excess spending, is an apparent and well accepted need, but the question that does not seem to me to be asked or answered sufficiently—the issue that does not seem to be met sufficiently—is the fact that when we in this country compare ourselves with what happens in other countries, it is not so much that our deficit is so appalling, it is not so much that we are over-spending or even that we are overtaxed. I think the way in which the incidence of taxation falls is open to criticism, but the total volume of tax collected in this country is not strikingly different from the total volume collected in other countries; obviously it varies from one country to another. Our real problem, it seems to me, is that we get such a poor return for our money, be it the money we have invested in industry or the money used by Government. Not only do we get a poor return but also—and of course this is linked to the

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question of a poor return—we get a poor return for our use of resources, including our human resources, both in Government and in the private sector.
It is to this question that we should primarily be directing our attention if we are to pull the country out of its terrible malaise. How can we get a better return on the resources we have? It is no good redeploying those resources, although I want to see them redeployed, if we continue to get such a poor return on them. As I say, it is to this question that we should be paying major attention. Of course, F agree that we need to have a greater wealth-producing sector and a smaller wealth-spending sector; I am putting it in that slightly pompous way because we must underline that wealth producing is not all done in the private sector. There is wealth producing in the public sector, too. Equally, we must remember that wealth producing does not apply only to manufacturing industry; there can be wealth producing in services as well. So that neat, over-simplified idea, that all wealth production is in manufacturing industry is too simple and should not pass without comment. But we need this shift out of wealth spending into wealth producing and I echo the comment made by a colleague of mine who said, "I am constantly meeting young people who want to devote their lives to the redistribution of wealth, but I hardly ever meet one who wants to produce the wealth in order to redistribute it."
Here, we have a basic problem of attitude, and unless it is checked we shall not achieve better use of our resources. In this connection, I feel that the Party opposite—understandably if one looks back 50 years—still has a considerable amount to answer for and, therefore, a very considerable job to do in bringing about this change of attitude towards the social importance of wealth producing. The idea that there is something rather indecent about being a wealth producer and something noble about being a wealth distributor, combined with the belief which is all too commonly held and fostered in some quarters which have given great support to the Government that it is quite easy to get available resources for the good schemes they want to support, must be dispelled. It is perhaps unfair of me to say it but I have, after all, spent
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a good deal of my working life in an atmosphere in which, for some sections at any rate, the idea that better social services can be had simply by passing an Act of Parliament is held with all too little regard for the source of the funds which are to pay for those better services. I have seen several generations of students sent out with that belief firmly implanted in their minds.
So this is a long-term problem and it will not be overcome just by another Budget or mini-Budget. However, unless we make a start on it, we shall not get the better return on the resources that we use and without which a mere redeployment will not help anybody much. Of course redeployment means a number of things. It means being selective with the use of the resources, and selection implies rejection. Selection means that there are some directions in which the Government are prepared to give support, to give money and to give encouragement, and that there are some directions in which they have to say, "No". I wonder whether the Government still have the toughness to say, No where people are asking for support because they are in a situation which confronts them with acute and serious difficulty and which will not be solved simply by bolstering them up.
Better use of resources brings us again to this question of the use we are making of manpower and the preparations we are making for its better use. The question came up earlier when we were talking about genuinely seeking employment. I should like to add here, picking up the point made by the noble Lord, Lord Houghton, that of course—and I know I made this point last week—we have not raised the question of people with occupational pensions because we think that they should not be allowed to draw unemployment benefit because they have an occupational benefit, but because they are not genuinely seeking employment. May I ask again, as I asked last week and the week before, that the interpretation throughout the whole spectrum of people drawing unemployment benefit and the interpretation of the phrase "genuinely seeking employment" and what is regarded as suitable employment should be reviewed, particularly for people under 45?
It was last December that the Manpower Services Commission produced a list of jobs for which it could not find people.

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I have repeatedly mentioned in your Lordships' House that we not only have inflation and full employment—which, 10 years ago, was considered to be an impossible combination—but we have unemployment, inflation and shortage of labour in some sections of industry. This is a ridiculous hat trick. The list of jobs for which it is difficult to find people came from the Manpower Services Commission seven months ago. I asked in a debate early in the year what steps were being taken to see that those shortages were filled. The list is there. I have never had an answer as to how far we have got in training people to fill those shortages.
There is another and equally pressing question: we are told, and there are signs that it is so, that the economic recovery is on its way. Every single time there has been economic recovery in this country we have run into acute shortages of labour. It will he inexcusable if this occurs once again because then we shall get this appalling misuse of resources. What is the good of putting money into new equipment if there are bottlenecks in the operating of the plant so that the equipment cannot be properly used? What next? Now, with well over I million unemployed, we are not getting people trained to fill the shortages which already exist and which will exist in much greater numbers as soon as recovery takes place. Can we have information from the Government as to what has been done in relation to the shortages which were identified last September and what has been done to identify what will be the shortages with recovery and what in numbers—and I should like this quantified—is being done to see that those shortages do not arise? This will mean once again that we put our capital into areas of growth and recovery and then we are held up with these absurd, wasteful bottlenecks because we had not the foresight to see that we were there. Foresight combined with some degree of toughness about genuinely seeking employment is what is needed.
If we really want to encourage the recovery of industry and to increase growth in the manufacturing sector and make good use of resources, we must look again at the kind of rewards which go to the wealth producers, particularly the middle managers. We all know that we
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are losing these people. People of the age of most of us in your Lordships' House would probably not he offered jobs overseas, but the young people under 35, as we must all know, are looking around, comparing their return with that for the same kind of job in other countries. The noble Lord, Lord Jacques, pointed out that the additional tax on employers—which I deplore—brought us more into line with European practice. Of course that is true but has the noble Lord looked at other aspects of European practice, particularly in relation to the kind of rewards which are given to the wealth producers? It is no good ducking the importance of the economic contribution that managers make.
After all, management is often criticised for having failed to make industry sufficiently effective. If it has been bad management which means that industry loses out, good management is of the greatest possible importance economically and it should be rewarded accordingly. We must look again at the tax levels as they hit those people. The Chancellor of the Exchequer spoke as if he understood that, but one has to look at the small print and I do not feel that the reflection of those remarks in the figures in the Finance Bill shows that he has adequately taken this point on board.
That brings me to the final point I want to make. If this recovery is to be sustained—and it has not yet got off the ground—what happens when the pay pause comes to an end next year will be of the greatest possible importance. It is very difficult because, on the one hand, we must encourage the people who need to be encouraged by the additional payments (which, after all, they earn if they are really delivering the goods) and, on the other hand, we must make certain, or else everything falls to the ground, that there is some overall control over pay.
My Lords, I know I said this last week, but I intend to continue saying it again and again; that is, that we should work out the institutional procedures for deciding how these decisions are to be made and, in doing this, we should look further than just the TUC and the CBI. These bodies are not representative, by far, of all employed people or of all the interests involved in the settling of pay. Can there not be a wider extension of

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consultation, of involvement, in what comes after August 1977? Because if we do not win that battle, then everything that we have been talking about today will be so much waste of time.
4.31 p.m.
Lord HARMAR-NICHOLLS: My Lords, it was to be expected, and is quite understandable, that this debate should become a discourse on the general economic problems of the nation, with more emphasis on last Thursday's announcement by the Chancellor than on the Finance Bill itself and the Budget that it is implementing. Indeed, the noble Lord, Lord Jacques, said that he wanted that to happen, and that was right. I was pleased to note that my noble friend Lord Carr and the noble Baroness, Lady Seear, recognised in passing that there was something other than the sheer econmic argument, which they have added to today. We are dealing with the Finance Bill, and I believe that there are good House of Lords reasons for remembering that today, quite apart from the important economic figures that have been bandied about by the speakers so far. We should be considering whether or not we ought to be giving it a Second Reading. We ought to take into account that there are things as important, and perhaps more important, as the economic strength of the country. There are things known as the freedom of the individual, and as being able to go on living in a free society—and marginally this Finance Bill embraces that thinking, too.
We all know that under the terms of the Parliament Act the House of Lords has no say at all in the levying or collection of taxes. That is the prerogative of the elected Parliament, and that is right. But we have our responsibilities in other spheres, and we must see that we do not ignore those responsibilities or run away from them. It is on the grounds of whether or not this Finance Bill is being inadvertently used in a way which may be weakening the future powers of your Lordships' House that we ought to examine it in some detail and consider whether or not we ought to reject it. The last time this power to reject was used by the House of Lords was in 1909, and that led to the constitutional crisis of 1911. The volcanic eruptions which came
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from that crisis mutilated many of the powers which the House of Lords had in those days, and so since then the House of Lords has been very cautious in the way it handles finance matters.
I want to suggest to your Lordships today that perhaps over recent years it has been too cautious; that it has been too cautious to the neglect of its own vital function of acting as a watchdog to safeguard the constitutional freedoms of the individual in this free society. On balance, I would say that that is a more important power to be used than merely having the monopoly to control the levying of taxes, and we should be very reluctant indeed to see this power, which we still have, whittled away. I would say to your Lordships that I do not think we ought to give a Second Reading to the Finance Bill today unless, at least, it has a warning notice attached to it. If it is to be allowed to go out as it now is, without such a warning notice attached to it, then I believe that we shall be being neglectfully cautious, and possibly infringing our own Standing Orders.
When the financial monopoly was given to the House of Commons they, in return, undertook to confine any Finance Bill purely to financial and tax matters. That was the agreement; that was what they understood and what they undertook to do; and they specifically agreed never to abuse their special financial prerogative by what is known as "tacking" on to a Finance Bill any matter that was not a tax matter or which in any way was likely to infringe the constitutional rights of the British citizen. That was the arrangement, that was the bargain—written, implied and well understood on all sides—and according to our own Standing Orders any such matter that is not to do with tax should not be easily passed through this House. The accepted procedure for things which are not tax matters is that they should be passed through both Houses, both having the power either to amend (which we have not got on a Finance Bill) or to reject—and if we reject this we can reject it for only one month, after which it automatically passes whatever we do.
That is in our Standing Orders, and I think it is right to have on the Record, as this is a continuation of an argument I have been putting to your Lordships

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individually for the last fortnight, the authority for saying that with such force. It is Erskine May, page 783. I quote:
"In former times, the Commons abused their right to grant supplies without interference from the Lords, by tacking to supply bills provisions which, in a bill that the Lords had no right to amend, must either have been accepted by them unconsidered, or have caused the rejection of a measure necessary for the public service. This practice infringed the privileges of the Lords, no less than their interference in matters of supply infringes the privileges of the Commons; and has been met by the Lords by standing orders …"
That is the authoritative confirmation of the point that I made about this bargain: that we, the nation, allowed them to have the full authority on tax matters, but in return for that they promised not to abuse a Finance Bill, which applies taxes, by bringing in something which was different from taxes and which may well be constitutional in its effect.
The Standing Order, which is on our procedural Table today, is Standing Order 49, which says this:
"The annexing of any clause or clauses to a Bill of Aid or Supply, the matter of which is foreign to and different from the matter of the said Bill of Aid or Supply, is un-parliamentary and tends to the destruction of constitutional Government".
My Lords, 1702 was the year in which that preventive provision was inserted into the procedures of both Houses. I want to suggest that the Finance Bill that we are dealing with today can be read so as to show that Schedule 6 to it is an infringement of the authorities that I have just quoted. Schedule 6, as it now stands, allows Inland Revenue investigators, after application to a court, to break in and enter private premises and to take away private papers which can be used to the detriment, tax-wise, of a private citizen. That, in my book, is clearly a constitutional change in the laws of trespass and of individual freedom. This is a section of law making which, in my view, is well outside the scope of a privileged Finance Bill. It is a law, this Schedule 6 provision, which should be enacted if at all, only after it has passed the full and separate examination of both Houses each of which has the power to reject or amend.
It was on these grounds that initially I was inclined to ask your Lordships to reject this Bill. It was on these grounds and it was certainly not with the idea of delaying the implementation of the Budget proposals as agreed by the other place.
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They have to be in operation before August 5th in order for the administration of the country to continue; it was not with the idea of delaying that. Originally I had the idea of asking your Lordships to consider rejecting it merely so that it could be returned to another place for them to correct; because if we rejected it and it was returned to another place then, within hours, perhaps within minutes, the offending Schedule 6 could have been removed, making this Finance Bill a clean Bill. Then, if they so wished, the terms of Schedule 6 could have been properly re-presented as a separate Bill which could go through the proper channels and, if found acceptable in both Houses, could have been made the law without infringing Erskine May ruling or Standing Order No. 49.
To have done that would have obstructed no one. There is no special date or special urgency behind Schedule 6 such as there is behind the Budget proposals which must be there by 5th August in order to grant the money to pay for the administration of the country. At least, I hope that there is no special urgency about Schedule 6. I hope there are not people lined up ready to have this freedom taken away from them and that there is no special urgency to get on with that job. I am presuming there is no urgency. We would not have delayed the real meaning of the Budget and we would have avoided what is a constitutional infringement of the freedom of the individual in a way that Parliament is there to see properly protected. That was initially what I intended to propose to your Lordships today.
But within the last week Mr. Speaker has taken certain action which I believe would cause the rejection to be misunderstood. I still think it would be right to do it; but since Mr. Speaker has taken the action that I shall now describe, I believe that there would be a real risk—and this I accept—of the action that your Lordships would be taking in rejecting it being misunderstood and of bringing in its train other things perhaps more harmful than letting it go through. In the last week, Mr. Speaker has officially certified this Finance Bill as a Money Bill. When he designates a Bill a Money Bill that, at first sight, conclusively implies that it is free from "tacking". I see that the noble Lord the Leader of the

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House nods his head. That may be a point that he will make if he feels that the points I am making are worth answering at all.
I am reluctant, and your Lordships will be equally reluctant, to appear to be in any way in conflict with Mr. Speaker because we know that his ruling, apart from being weighty, is unquestionably an objective one. It is for that reason I would not now propose to suggest that your Lordships vote against the acceptance of the Finance Bill. But I would say this: if new evidence could be produced, it would not be a slur on the dignity of Mr. Speaker or upon the supreme confidence that we have in his impartiality and his objectivity to ask him to take such evidence into account. It is within the recollection of all here that precisely this has been done within the last month; so that there is a precedent, and a very respectable one, which can show that even Mr. Speaker's ruling does not stand firm for all time if new evidence can show that an Amendment ought to be made.
On the question of whether or not a Bill was a hybrid Bill a week or two ago in another place, Mr. Speaker Thomas reversed a ruling given by his predecessor earlier in the same Session on the grounds that he had new evidence. He was right and it was applauded throughout the country. So it is because one does not want to give the impression of being in conflict, and in order to maintain the good and proper relations between the two Houses, that I would suggest that we ought not to reject it. I maintain that the precedent I have given of only a few weeks ago would show that if there was new evidence it could be taken into account.
I think it right that I ought to tell your Lordships what I think the new evidence is. I believe that the ruling was given to make this Bill a clean Money Bill on the proper grounds that it could be said that the elected Chamber has the sole power to levy taxes and it is right that they should have the power to see that those taxes are collected. That I would accept. But I wonder whether the noble Lord the Leader of the House could at some time get one of the Law Officers to confirm whether or not this power is just for the collection of taxes as agreed. This power that is taken
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in Schedule 6, after an application to a court, enables an individual house to be broken into and papers taken in order to arrive at the assessment of what he may have to pay. That, I would submit, is not in accordance with the collection as well as the levying of taxes. I believe that those new grounds may not have been put to Mr. Speaker when he gave the ruling on the Money Bill.
However, the grounds for giving clearance are, at best, hazy enough to suggest that this House should at least make some official move to remove any doubts as regards future Finance Bills. That is as far as I want to go today. To this end, your Lordships will see that I have put on the Order Paper today a Motion to the effect that the operation of Standing Order No. 49 he sent to the Committee for Privileges for them to examine and to strengthen for future years. If the noble Lord the Leader of the House when he speaks could give me some indication, I would prefer to do it this way in order to make it perfectly certain that there is no question of our wanting to be in conflict with the powers of another place. My noble friend Lord Carr and the noble Baroness, Lady Seear, seem to have indicated that they have some sort of sympathy with the Motion which I have just described and which I have on the Order Paper. If the noble Lord the Leader of the House could, with his even greater responsibilities and influence, show that he feels that, too, then, when we get to my Motion after this debate, I would beg leave to withdraw it with the idea of re-presenting it on the Order Paper in September so that we have given a gap which can remove any possible thinking of our wanting to be in conflict with another place.
The Privileges Committee may find it desirable, if they are allowed to examine it, to find some way of underlining the message contained in Standing Order No. 49 and so prevent the ancient powers and privileges of this House from falling into disuse—because that is what we have been allowing to happen over recent years. Half of the Finance Bills that have come before this House since 1911 have not even been designated as Money Bills. I believe that we must be on the alert. I hope that your Lordships in all parts of the House will find it prudent, at any rate, to be so.

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Having made that technical point, perhaps I may be allowed for a minute or so to make a point on the Bill itself. As regards the other parts of the Finance Bill and the economies announced last Thursday, I should like to say—merely as an extension of what I have already said to the noble Lord the Leader of the House at Question Times in the past—that if the measures that were accepted on all sides when announced last Thursday with the idea of wanting to re-establish world confidence had been taken two years ago, they would have re-established world confidence on the question of our solvency and our general economic health. If they had been taken 12 months ago they might have rescued the pound sterling from the disastrous slide in its value; but I believe that this type of medicine, even at double strength, will not alone do the trick today. The lack of world confidence now encompasses much more than mere over-spending or over-borrowing or fiscal ineptitude. That is the view I have formed from speaking to industrialists, diplomats and men of commerce in four continents over the past 12 months, a view that I pass on to your Lordships in all seriousness.
The world now questions our will to do these things and our ability to see them through. This questioning of whether we have the will and ability to see it through comes from our friends as well as those who are not so friendly with this nation. The doubts they want allaying today are summed up in the headline which appeared in an American newspaper 18 months ago when it asked the question, "Is Britain governable?". Our friends say today that we are at the stage where it can be said, "Yes, Britain is governable and capable of rescuing itself, but not under a Party Government". They have seen a Socialist Government unseated because they contemplated an Industrial Relations Bill entitled, In Place of Strife. They have seen a Conservative Government unseated because they introduced a similar Bill. They have seen a second Socialist Government only able to appease the extremists in the unions temporarily by agreeing to measures which can only cripple the private wealth-producing part of our economy.
The first essential in my view towards regaining world confidence is a political
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one. For a period, whether we like it or not, we must have a Coalition or National Government. We must have a sign as clear and as traumatic as that if we are going to tell the world that we recognise the magnitude of the task before us, a sign that a worthwhile proportion of the leaders of all political Parties are prepared to suspend sectional and doctrinaire aims, as they did in the war, long enough for us to win this war against the threats of economic collapse. If we do that, we shall win through and win through quickly. Without it, even the right and the normally adequate economic measures will be like pouring good medicine down the drain. I see no sign of this action, which I believe essential, being taken. It apparently is not on; but it is so essential and I still live in hope.
4.57 p.m.
Lord WIGG: My Lords, the noble Lord who has just spoken said in the first part of his speech all that I wanted to say and intended to say. He said it with much greater ability and considerably more clarity than I could have hoped to obtain. I support that part of what he said, but with one or two differences. He started by drawing the attention of your Lordships to the fact that this House should act as a watchdog. The trouble is not that it has failed as a watchdog; what it has become over the years is a lapdog. It has become a lapdog of the Tory Party carrying out the will—often the transient will—of Conservative Governments when they are in power, and embarrassing a Labour Government when, in the fullness of time, the Conservative Party find themselves on the Opposition Benches.
I will probably bore your Lordships in saying that for me the one act of your Lordships that forfeited my general support of this House as it is now constituted, was when, in pursuance of political needs of the Conservative Party, it failed to hold up our entry into the Common Market, and did not give the people of this country an opportunity to understand in detail and to hammer out in broad principle what was involved. It was very much more than passing a Bill which had been forced through the House of Commons without a single comma being altered; it was finding and telling the British people, "All you have to

1219
do to get everything under the sun is to go into Europe". I retain all the documents and speeches, including some of the speeches of the noble Lord the Leader of the House. It is very interesting reading, provided you have a strong stomach. If your stomach is at all weak, then you have a violent desire to go out and be sick. We were being promised by all sides of the House that the Common Market was going to deliver the goods. It has not, and it could not, deliver the goods. The only place from where Britain should be governed is London, not Brussels.
The only people who can save the British people are the British people. If we cannot find within our hearts and muscles the worth and strength to tackle our problems, inevitably we are going to fail, and we deserve to fail. The extent to which we have been mesmerised by easy solutions is also the extent to which we have failed to recognise the problem. I entirely agree with the noble Lord, Lord Harmar-Nicholls, in his protests about Clause 57 and Schedule 6 of the Finance Bill. It is a measure of fundamental importance which I support. It has been tacked on to a Finance Bill because the Government would find themselves in some difficulty if it was treated as it ought to be awed, on its merits, and brought to this House. The Conservative Opposition would unquestionably throw it out and that would be an embarrassment. The provisions in Schedule 6 are necessary. I have already said that.
I am a Socialist without prefix or suffix. My political faith today is that which I have held all my life. That means in political terms that I believe in planning. Planning in the modern world is necessary. You may not call it that. I also believe, because my belief in democracy is as strong as my conviction in the principle of Socialism, that there must be a check and a check again of powers exercised by the Executive in order to secure freedom, not as an academic exercise but because I believe the genius of the British people comes about through the exercise of the voluntary principle. When this nation, down the centuries, has recognised a problem, at that point we are one stage off finding its solution. Until the problems
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which face our country are recognised in depth, no solution will be found.
I believe we even underestimate our strength. Listening to the speeches today, one would think there has been calamity; everything is wrong. If we do not do this and that, then calamity is going to result. Not one single speaker—not even the speaker from the Government Dispatch Box—found much to cheer about. I do not share that view. I think the cause of our troubles is because we have not come to recognise our position in the world. For me Suez was a turning point. At that point "Great Britain" became "Little Britain". We no longer had effective power to influence events. We could—it was within our grasp if we wished—exercise great influence. But power in the sense that we exercised it in our heyday, or as we thought we could exercise it at Suez, was not a starter.
Shall I bore your Lordships once again by reminding you of this? When we talk about a saving of £400 million, £800 million, £2,000 million, I ask your Lordships to stop and think what has been spent on defence—£57,000 million. For what? What action could we possibly, in any circumstances whatever, undertake against anyone? There is no place for us in the world through the exercise of our defences. Our place is among the nonaligned countries. We are not in the first division any longer. What we should do is strive to be at the top of the second division. We should be alongside Yugoslavia and Algeria, exercising our influence through the 77 countries which comprise the non-aligned group in the world. They matter. Nobody takes any notice, in Washington, Moscow or even London, of a Commonwealth Conference. That is just a joke. But what happens when the non-aligned conference takes place very shortly is a matter of world importance, not in terms of the exercise of military strength, but of what will happen to commodity prices and of what those countries will ask of us, and if we do not give we shall find ourselves in a very weak position indeed.
Of course, the Budget and the statements that have been made are unacceptable. I suppose that if a man has been poisoned you have to do something about it. If you fetch in the doctor and he recognises a sign, he will prescribe the right remedy.

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At the moment—I think, through mistaken policies—the Government and the country find themselves in a very difficult position. So the Government have to come forward with proposals which I do not believe are likely to be very effective, and I do not think they are very acceptable, yet I support them. The mere fact that the country is faced with its present situation means that there has to be something of this kind, because our physical needs require it.
I am a little upset at the muddle-headedness of what is called the Tribune group, and of those whose views, in general, I share, because they are making the mistake of refusing to face up to their political responsibilities. If the patient has taken poison, you may have to give him an emetic. The emetic may not be very pleasant, but if you want to save his life it is essential. If somebody stands up and argues that the measures which have now to be taken do not measure up to the need, I should not like to be in the Chancellor's position. He has a very awkward furrow to hoe. This is indeed a problem. However, let me say—and let us cheer about this—that this Government have succeeded where the previous Government failed lamentably, because at the moment they have an incomes policy in very difficult circumstances indeed. I pay my tribute to Jack Jones and those of his colleagues who have carried it through in the first year, and again in the second year, because without it this country's position would indeed be difficult. But, very largely because of the carping attitude of the Party opposite, and the very subservient media that we have, which means the Press and the BBC, the position and strength of this country are written down all the time.
It is made to appear that the nostrums which have been prescribed, and which the Chancellor and the Government have decided are necessary, are not enough and have been forced down the Government's throat. I do not believe that. The trade union leaders here are in touch with opinion. They know what is. practical, and they also know that they are playing for very high stakes indeed. I believe that incomes policies are born to die, but in its present situation this country needs an incomes policy for this year and next year, and in order to have that it must
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stay on course so far as its social and economic policies are concerned. The Chancellor does what he does, because in his judgment the economic and political necessities require it.
In general—if I may say this without any damaging effect—I have a high regard for the noble Lord, Lord Carr. But in the concluding words of his speech he suggested to Mr. Healey that he should follow the example of the Prime Minister in November 1967. I have been in politics a fair time, and I also have a fair memory. I wonder what the noble Lord, Lord Carr, said to the then Mr. Barber in the heyday of the most disastrous economic policy that any Government has ever wished on a poor unsuspecting country. Did he go to him and say "Mr. Barber, go out and cut your political throat"? Of course he did not. He toed the line like the rest of the Tory Party. They toed the line and had the responsibility for the raging inflation which we inherited. We inherited it in 1964—do I not know it?—and we inherited it again after the departure of the last Conservative Government. The policies then were built for us. Addled eggs were hatched out for us by Conservative Administrations who hate the idea of planning. Of course, they hate planning partly because they want to preserve the quality of looking after a section of the community who think that their interests are best served without planning. Planning is a dirty word for them. But, obviously, in the kind of world that we have somebody has to take decisions.
I am one of those Socialists who believe in a mixed economy, and who also believe that Socialism requires the effective use of the pricing system. I realise only too well that either you will have hosts of civil servants taking detailed decisions about manpower supplies, raw material supplies, training and the like, or you will let the pricing system do it for you. I believe in overall planning. I am less enthusiastic than I was about nationalisation in the old sense. What matters in the modern world is less the ownership, and much more the purpose for which resources are used. This seems to me to be more effective. But the idea that at the present state of our society you can leave the shipbuilding industry, the aircraft industry, the mining industry or the steel industry

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to the higgling of private enterprise is absolute nonsense, and among the chief protagonists of the view that there ought to be over-planning are the great industrialists themselves.
The question in the modern world is not whether you plan or do not plan. The question is in whose interests the plan should be made, and how it should be administered, and for me this is the core of my Socialist belief. In the ultimate, I believe that private good must prevail. I also believe in the maximum amount of individual freedom and for that to happen, then, if there is to be a second Chamber it must see that it retains and uses effectively whatever powers it is given.
I should have thought that one of the lessons in this bicentennial year is to be learned from the Americans, who plan. They plan through the giant corporation, but they also see that it conforms to the rule that the freedom of the individual there is placed second to the public good. There are plenty of exceptions, but the result is overall planning allied to gigantic resources and the freedom of the individual. The result is an economic giant which produces the strongest economic power on earth at present.
While there is no place for us in that league, we have plenty to give and plenty to learn; but we have nothing to give and nothing to learn unless first we understand the problems which beset us. Very largely they are problems of our own making but they are not insurmountable. They can be tackled, but they will not be tackled and we shall not be saved by Common Markets or any other nostrum. We have to tackle our problems by an effective diagnosis and understanding of what we face. Then we have to plan; and when we have planned we have to carry out that plan effectively inside the framework of democracy.
I congratulate the noble Lord, Lord Harmar-Nicholls. It was his speech which provoked me to speak. I do not want to dot the i's and cross the t's, but simply to give my general support and at the same time to draw a lesson or two not only from the Budget but from the experience I have gained in your Lordships' House.
Viscount MASSEREENE and FERRARD: My Lords, before the noble Lord sits down may I ask him a question. I have been reading Schedule 6 while the noble Lord has been speaking. Why is the noble Lord so sure that if the Government introduced a Bill that incorporated all the sections in Schedule 6 the Conservative Opposition in this House would throw it out? I do not think that they would. An officer of the Board of Inland Revenue has to go before a circuit judge in England and Wales and the judge takes his evidence on oath. If the judge considers that there has been fraud he grants an order and the Inland Revenue is allowed to enter the premises where the fraud may have been perpetrated. I do not think that the Conservative Party holds any brief for fraud. I thought that my noble friend who is sitting behind me was objecting to the tacking on to the Finance Bill of a measure like Schedule 6, and I wholeheartedly agree with him. But for the noble Lord, Lord Wigg, to say that if the Government introduced a separate Bill incorporating Schedule 6 the Conservative Opposition in this House would throw it out, is surely nonsense.
Lord WIGG: My Lords, how can I be sure? But judging by the noises which have been made both in another place and in the Press, I should have thought that there would be considerable opposition to such a Bill. All I am arguing is that for some reason the Schedule was tacked on. I do not agree with the noble Lord, Lord Harmar-Nicholls, that it was tacked on inadvertently; Governments and their advisers do not do that. The Schedule was tacked on because it was much more convenient to do so; it had a much better chance of getting through if it were tacked on rather than if it went through under its own steam. If I am wrong—well, all right.
5.14 p.m.
The Earl of MANSFIELD: My Lords, I hope that the House will forgive me if I do not follow the path which was trod by the noble Lord, Lord Jacques, when he opened the debate. Still less do I intend to follow the byway trodden by the noble Lord, Lord Wigg, although, as always, I was fascinated by his contribution to the debate. My intention

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is to confine myself to the Motion which is before the House and to a rather small and technical part of the Finance Bill which is now before us. If I have to make excuses for so doing, they are two-fold: first, because I regard it as being an extremely important matter which should be ventilated in your Lordships' House and, secondly, because, owing to the haste with which the other place has to consider in particular the later stages of this Bill, ventilation of it is in my judgment desirable and, indeed, necessary.
I intend to confine myself to that part of the Bill which deals with the national heritage. Although in a geographical sense I am speaking from my normal position, I should make it plain that I am speaking personally and not necessarily as representing the Opposition opinion. Nevertheless, one is happy to say that to a very large degree the major Parties at least are in agreement that the financial problems which beset the national heritage deserve and should obtain special consideration and treatment.
When last year your Lordships debated the Finance Act, as it now is, during its Second Reading, I led for the Opposition and was immediately taken to task by the noble Earl, Lord Longford, for the language which I chose to employ on that occasion. I admit that on rereading what I then said I took, if I may use the expression, a good swipe at the Government for what I regarded and still regard as the malicious and thoroughly partisan manner in which at that stage they approached their task of raising revenue. It would be wrong of me not equally this afternoon to give a measure of congratulation to the Government who in this sense have come round, as I perceive, to recognising the problem, although again one has to say that this recognition is by no means disinterested.
Each year the tourist trade is worth several billion pounds in foreign exchange to Britain. The British Tourist Authority has estimated that 80 per cent. of all foreign visitors visit an historic building of one kind or another. It is the attraction of our heritage which to a very large degree draws tourists to our island in the first place. It is the appearance of our countryside and the buildings within both our countryside and our towns, and not least the treasures within those
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buildings, which are the envy of every other country with pretensions to civilisation.
Not the least part of the attraction is that so many of our historic homes or buildings are inhabited and are going concerns, in the sense that they are still fulfilling a need as a dwelling-house or habitation, for which reason they were first put up. It seems to be generally agreed that heritage properties, particularly historic homes, may best be maintained and looked after by their owners for the time being, because those owners generally regard themselves as mere trustees for their lifetime of the property which they happen to inherit. If it is necessary, I shall declare my interest, although it will be well known to some noble Lords at least.
The Government have recognised and have said through their spokesman on a number of occasions that it is not feasible for either a Government or a similar agency to run historic homes. The cost to the taxpayer, even if such a procedure were feasible, would be so enormous as to render it out of the question. Therefore the Government are to be congratulated on showing a degree of courage, particularly in view of the fact that some of their more extreme supporters remain convinced that any remedial steps which are taken to enable historic houses and their contents to be maintained in private hands will, in some measure or in some degree, confer large and unjustifiable fiscal privileges, I suppose one might call them, upon the owners.
With that measure of congratulation to the Government there go also many congratulations to my noble friend Lord Montagu of Beaulieu and his colleagues, both in the other place and in your Lordships' House, who have made such determined and sustained efforts to bring to the notice of both the Government and the civil servants who advise the Government the difficulties which these buildings are presently experiencing and to suggest measures which, when reviewed calmly and without rancour, may act to the benefit of the buildings, and indeed the nation as a whole.
The Bill which is presently before your Lordships contains a number of provisions relating to this subject, in Clauses 76 to 85. Indeed, in Clause 77 your Lordships will see the designation of the types of property which qualify for relief

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under this Bill, and to anybody who follows the subject the degree of property which can be the subject of relief has been to a welcome degree enlarged.
Apart from that clause, it is Clause 84 upon which I particularly want to comment, for the reasons which I have stated, and also because I want to ask the Government a question which I hope will be answered later, if not today, and also to point out the fallacy of certain arguments which flow from Clause 84. The clause reflects an attractive idea that by the setting aside of money a degree of relief from capital transfer tax may be obtained, and that money can be devoted to the maintenance of historic buildings, always provided that the public enjoys a certain measure of access to them. Indeed, at first blush it is an attractive idea which has much to commend it and I, for one, would be in sympathy with it if it could he made much more effective.
The difficulty is that there are a number of drawbacks to the scheme which, if not unattractive at the end, at least greatly detract from its attraction. First, the funds which are put into the fund are irrevocable. It is the same as an irrevocable trust, and if that were the only drawback I should have no complaint. The irrevocability, combined with some of the other drawbacks, in fact makes it unlikely that many owners of historic houses will transfer their funds into such a fund.
Secondly, the funds which are so transferred into this kind of trust are going to be taxed at the settlor's own rate so far as income tax is concerned, so that if the settler—who presumably is a person with some considerable funds or he would not be making the settlement in the first place—has a high rate of tax on the margin therefore the amount of money left to be devoted to the historic house at the end of the tax year will be minimal. Therefore, that again is a drawback and is something which I think may detract from the attraction to those who may wish to set up this kind of fund.
Thirdly, this provision separates the ownership of the building from the ownership of the money, or whatever the funds are, within the fund; and by providing no income tax relief for moneys
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within the fund which are spent on the building the relief which is now available for building supported, for instance, by agricultural estates under the Schedule A estate election, as I think it is called, will be lost on the settlor's death, so that the situation will be worse even than it is already. I draw that distinction because I think it is worth recording it.
Fourthly, and I am afraid even more technically, the fund which is settled, in England at any rate, will be subject to what is called the perpetuity rule which, in effect, means that after 80 years this irrevocable fund will pass away from the historic home in whose favour it has been settled and will have to go to a designated charity or some other similar fund.
I think the perpetuity rule is a drawback in two ways. First, the people who wish to provide for the continuance of their historic home are not likely to do so unless they have a very large amount of free capital which they are content should be dissipated over the next 80 years. Secondly, it will, above all, make it most unlikely that those who perhaps own agricultural land round the historic home will put that land into a fund, because at the end of the 80 years perhaps the income-producing farms, or whatever it happens to be, which will have provided the income for the historic home will inevitably pass into other ownership. So that the old concept of the historic home being the centre of an estate can no longer obtain with the perpetuity rule.
I wish to ask the noble Lord this question. In the way that I read this Bill I cannot see that any particular provision is made in respect of Scotland, where we do not have the perpetuity rule anyway; in which case as I read the Bill—and I may be talking nonsense but perhaps the noble Lord or someone could write to me in the future—it seems to me that a fund set up in Scotland would not be subject to the perpetuity rule but could go merrily on, which would indeed be a good thing. It arouses a happy idea that perhaps people in England might set up a fund in Scotland to finance for all time their English historic home. I merely throw that suggestion in.
Those then are a number of drawbacks. Another one—and I put this in fifthly and lastly—which is capable of being resolved

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by the Government in the next Finance Bill is that the funds which have been made the subject of a settlement can be devoted to the upkeep of the building but not to the contents within it. So we get the bizarre situation where the trustees can draw on the funds to mend the roof but not to mend the picture or whatever it happens to be within the building. That cannot really be the intent of the Government and I should have thought this is something which could be reconciled between now and when the Chancellor next comes to consider his Budget. It also appertains to gardens or any other amenity land round the historic home, unless that land is itself designated under the section which I have previously adumbrated. So, as I have said, one can use these funds to repair the house but not the contents and not to mow the grass round it. That surely is not very sensible.
Shortly after this Government came into power I made a speech in your Lordships' House to the effect that even at the then existing level of taxation the future of historic houses was bleak. The rates of income tax and the capital gains tax made it a fact that even if—as people then could—they took advantage to make over their historic home in good time so that no estate duty was paid, it was impossible either to save or to earn the sums of money which have to be provided from time to time for the expensive repairs which these old buildings need. I am afraid inflation has only magnified the problem and the introduction of the capital transfer tax has aggravated it still further. I draw the Government's attention to these drawbacks to their scheme only because the position is really not one that can be just left. To do them justice, I do not think that members of the Government believe that this is the end of the story. From reading Hansard as this Bill went through its tortuous course in the other place, I do not think that is so, but it is not right that anybody should think that this Bill will do anything much for the preservation of our historic houses in the future.
It remains a fact that if owners of these places are faced with bills for tax on what are unproductive assets, or bills for their repair which they cannot meet, they will sell those assets if they are saleable
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and leave them to deteriorate if they are not. The number of works of art leaving the country grows, apparently, every month. The noble Earl, Lord Perth, was in his place some time ago, and he has a number of agonising decisions to make in the course of the year. The number of historic houses which have tumbled down, literally, since the end of the Second World War now runs into hundreds. I do not think we want that situation to continue. I repeat what I said earlier on, that a number of us are grateful to the Government because we now consider that they realise the difficulties and are genuinely concerned to ameliorate the position. But the position will not wait for very long. I very much hope that the noble Lord, the Lord Privy Seal, when he comes to reply, will at least make encouraging noises to indicate that the position will be kept under continuous review.
5.31 p.m.
The Earl of LONGFORD: My Lords, I am in no way qualified to deal with the very interesting and knowledgeable remarks that fell from the lips of the noble Earl, Lord Mansfield. I might or might not be able to deal with the remarks of the noble Earl, Lord Gowrie, though I cannot hear them at the moment. The noble Earl, Lord Mansfield, at one moment announced that he might be talking nonsense. If so, that possibility had not occurred to me, but I must leave the Minister to reply to him when he winds up. The noble Earl made one generous reference to what the Government had sought to achieve, and at the earliest moment one should express thanks from this side of the House.
My Lords, the last time we debated economics I spoke for far too long, a fault from which one or two of the speakers today have not altogether been free. But I shall not myself, I hope, incur that blame today. That will prevent me from attempting to reply to most of the vigorous speeches to which we have listened. The noble Lord, Lord Wigg, dealt with some of the Conservative contentions in effective style, and has saved me from that responsibility. I should like to deal with an aspect of all this which so far has been ignored. I speak, as I suppose one could say, as a middle-of-the-road Socialist and from that point of view, of course, speaking from the middle of the Labour Party, one

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is bound to discuss the question of whether the Chancellor's cuts were necessary at all. Of course, the Conservatives say the cuts were quite inadequate, but in the Labour Party the argument is of a different character. I propose to spend my fairly short time dealing with that side of it.
I was so happy last week to feel that in these latter days I was not a member of the Cabinet. About now, I should probably have been talking of resignation, to the great irritation of my colleagues. I would have been in great doubt a week or so ago, if I had been in that exalted position, that I could have continued there. In this House a month or so ago I took the line that it would be quite wrong that the level of our social services should be determined by the state of foreign confidence, often a very irrational factor. About a week ago, or before that, we were told that owing to the state of foreign confidence, and owing to the need to reassure the foreigner, large cuts would be necessary. Large cuts have duly occurred, plus the taxation, which I have no time to deal with now. I have every bias in favour not only with the present Government, but with Mr. Healey in particular. He has many virtues not often found together. He is very tough, not that I think that toughness is necessarily a virtue in itself; it could be a curse rather than a blessing to mankind, but in this case it is coupled with a strong intellect, and I hope he will be Chancellor of the Exchequer for a long time to come, despite all the rumours one has heard.
For the reason I mentioned, in view of what I said only a month ago in this House, I awaited with intense anxiety the announcement of the Chancellor of the Exchequer, as did many other members of the Labour Party, including, I am sure, many who sit with me on these Benches. My anxiety was not diminished by a brilliant article in the Evening Standard of 20th July (before the cuts) by Professor Maurice Peston, who is an old pupil of Professor Robbins, although I am not holding either responsible for the other. The article was entitled, "Denis in a Dark World", and this sentence occurred:
"We might be obliged to act daft because we live in a daft world",
or, as the Professor says elsewhere, making the same point,
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"The Chancellor may be forced to do something which is economic nonsense because the key variable, foreign opinion, is not under his control."
That is what I was discussing when I spoke last in this House, the question of whether we have to obey the dictates of foreign opinion, however misconceived.
Then came the statement by the Chancellor last Thursday. Like other noble Lords, I have gone through it with a fine comb, reading between the lines as best I could. Admittedly, there is a reference in passing to the need, and I am now quoting from the words of the Chancellor of the Exchequer:
"to maintain the confidence of those from whom we may have to borrow to finance our external deficit".—[Official Report, Commons, 22/7/76; Col. 2011.]
Apart from that passing reference, the topic is passed over in virtual silence. The whole emphasis is on the need to cut back public spending to make room for prior claims on resources, particularly for exports and private sector investment. I am not saying that is in conflict with the desire to restore foreign confidence, but you can read the Chancellor of the Exchequer whichever way you like, this way up or that way up, and you will not find the factor of foreign confidence is stressed in any way.
If this is the true reason—and I believe the words of the Minister—for our policy, it is a much more telling one than the argument about the need to impress international financiers. But it opens up a very technical discussion and takes us into an area where a Back Bench Peer, even with some ministerial and banking experience, is very unwise to speak with dogmatism and even some Front Bench Peers might hesitate to rush in. But to quote Professor Peston again:
"Although one may disagree with the Chancellor, he is the man in charge. Having had a chance to argue a case, if one has failed to convince him, I feel obliged to defer to his and the Treasury's judgment".
The noble Lord, Lord Boothby, is not present, but we do not need him to tell us that the Treasury has often been wrong, so far as we can judge. Some of us are not as humble as Professor Peston when we think of all the Chancellors and their Treasury advisers who have proved so fallible in recent years, which is not to say that anyone here has any claim that he has done better.

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I could not help noticing, for example, that a well-known and much admired economist, Michael Stewart—not the former Foreign Secretary—in a powerful letter to The Times on 6th July argued the opposite case most effectively. He argued that there was no reason for cuts in order to liberate resources. So it is a matter of argument and very acute disagreement among those most qualified to judge on technical grounds.
Professor Robert Neild of Cambridge University, and Mr. Terry Ward, examined the whole question of the Budget deficit in The Times of 12th July. Their conclusion was a highly academic one, but I think one gets the general drift. They say:
"a general bias neither in favour of cuts in public expenditure, nor against increases in taxation, can be justified by a reference to levels in other Western European countries."
The general impression left on one after reading this article by Professor Neild and Mr. Ward is that large cuts would not be justified. Various expert assessments have reached me, which came to the same conclusion, the opposite conclusion to that of the Chancellor. For example, this is a very high-level Labour Party source:
"Constraints of plant capacity are no more a serious justification for public spending cuts than are future shortages of labour".
That may be right or wrong, but at any rate it is a view held by those who are well equipped with expertise. I try to give the Chancellor the benefit of the doubt, taking him on his own argument, not about the international financiers but about the resources, and I am left with a very large doubt indeed.
I hasten to say, however, that if he had to make cuts of this magnitude, in my eyes he set about it in the right way and reduced to the minimum the human distress resulting. Of course, I think the noble Lord, Lord Carr, would say that even if he was going to make those cuts he did not make them in the best way or did not level the wisest kind of cuts. The noble Lord, Lord Carr, did say one thing at least with which I agreed strongly: that he was delighted that overseas aid had not been cut. I think we can all take pleasure in that. However, for my own part, I would submit that if cuts of this size had to be made the Chancellor has made them in the
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least brutal manner available. I say that though I have not yet studied the implications of the cuts for some of the social services, and already before these cuts many of the social services were in very great difficulties. Therefore, on balance my vote, for what it is worth—I take it I will not be required to cast it—goes to the Chancellor, though only by a hair's breadth. I hope that is a clear if not very enthusiastic verdict.
In my speech of 9th June I pressed as strongly as I could the case for selective import controls. I did so in regard to the immediate future and because it seemed, and still seems, to me extraordinarily difficult without import controls to envisage a return at any point to genuine full employment without the trade balance going to pot straight away. I said that a month ago and I would say it again, but I will not develop that argument further this afternoon. The noble Lord who opened the debate had something to say about it, and we may hear more about it from the noble Lord the Leader of the House when he replies.
Tucked away in the Chancellor's speech there is this promise:
"…the Government will also watch vigilantly the need for any extension of their existing selective import restraints to provide temporary protection to viable industries faced with unfair foreign competition."
The noble Lord quoted the next sentence:
"We have already taken action and we are anxious to discuss with both sides of industry the need for further action of this kind."—[Official Report, 22/7/76, col. 962.]
So I think one can fairly say that the door is left open and import controls have not been rejected for good. Here I am not as pessimistic as the noble Lord, Lord Carr, or as optimistic as the noble Lord, Lord Jacques, but, regretfully, I believe the Chancellor will sooner or later find himself driven more and more in this direction. If and when it happens, it will not be a matter for national congratulation but of economic survival. Equally, if the policy of import controls comes to be adopted I would not call it a policy of national selfishness. If only we could make ourselves more economically successful we could do far more for the rest of the world, and particularly the poorer countries, than at any previous time. That is, I am sure, the long-term objective

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of all of us. Meanwhile I am sure that the Government are utterly sincere in what they are doing and dedicated to the task in hand, and in that respect at least they have my unqualified approval.
5.44 p.m.
Lord MONTAGU of BEAULIEU: My Lords, I hope the House will forgive me if I say a few words on the same subject as my noble friend Lord Mansfield; namely, the clauses affecting the national heritage, Clauses 76 to 85. I should, first of all, say that I speak as President of the Historic Houses Association, and I should like to pay my tribute to the Government for the great help they have given the heritage both in the 1975 Act and also in the 1976 Bill which is before the House this afternoon. Indeed, it has been perhaps the biggest leap forward since the war, perhaps since the Labour Chancellor, Sir Stafford Cripps, accepted the Gowers Report in 1948. That certainly was the Bible so far as the heritage was concerned. But all these problems came up again at the time of the Select Committee on the wealth tax. In fact, this was a very good report so far as the heritage was concerned, because, for the first time I think, all three political Parties agreed what their attitude should be towards the heritage. It is indeed comforting that we have taken this out of the political arena as far as possible. What is now, I think, generally recognised is that conservation certainly does cost money, and that the Government know only too well, as they have several houses in their care which they have to look after.
Great and small historic houses are not refuges for the rich. They are now much more liabilities than assets. I think it may be interesting for us in this House to note this afternoon that only 60 out of the 400 houses open to the public are owned by Members of your Lordships' House. It has been through the efforts of the owners and their personal sacrifices that we are the envy of the whole world today, in a world where big houses have been allowed to fall down and decay. Therefore, I should particularly like to express the Historic Houses Association's welcome for the capital transfer tax exemptions, for the house and the contents and the gardens, subject to public access,
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and also for other land of scenic and scientific interest. This year this has been extended to lifetime gifts, which also is very welcome.
As Lord Mansfield said, the Bill contains one important new clause, Clause 84, about maintenance funds. I do not wish to go into this, as it has been done so ably by Lord Mansfield, but I would say that there is certainly a welcome on our part for the political will that persuaded the Treasury and the Inland Revenue to accept this new principle of exemption of maintenance funds. However, as the clause is at present drawn it is more than a disappointment; indeed, it is virtually useless as it stands. I am sure it would not be impossible to put that right perhaps in future years. I am sure the public at large would like to see owners encouraged to set up maintenance funds for their houses. These trust funds have to be administered by independent trustees, and I am sure we could trust them to spend the income free of tax on the house. The clause is not going to fulfil its purpose. It will only help perhaps one or two large houses, when it is today the smaller houses that desperately need that help.
All these concessions are tied to public access, and the Historic Houses Association certainly encourage their members to open as much as possible. Last year we had over 7 million visitors to our private houses and thus made a great contribution to tourism. There is no guaranteed profitability from access. Indeed even when one does open it is very difficult to make a profit, and even on the money spent on repairs VAT is charged. In view of these new exemptions, I am sure it will be realised that many new houses are going to be open to the public. Therefore, it is very important for guidelines or rules to be drawn up so that owners will know exactly where they stand. Also, do these exemptions apply to historic houses which are used as hotels or schools or community centres? The Historic Houses Association is at the moment in consultation with the Historic Buildings Council and we certainly welcome these consultations. It is most important that these rules should be flexible, because one cannot possibly lay down rules which will cover a large house near London and a small remote house in the depths of Wales or the North of Scotland. Therefore, the

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geography of the house, the ease of access to it, and other local conditions must be taken into considertaion. I should like to say that the Historic Houses Association certainly wishes to continue to fulfil its part in making the national heritage work.
Finally, my Lords, I would make one comment on a completely different subject, Clause 12, which is the clause which enables the Government to charge a great deal more for the transfer of number plates from one car to another. This, I hope noble Lords will agree, is a popular and harmless hobby, perhaps a bit snobbish. Nevertheless, many embassies and other people do have these number plates. Many of them have been handed down as heirlooms from one generation to another. I was speaking to a senior police officer recently and he said he welcomed these number plates. Not only did it make it easy to recognise who was driving, but it made people drive very much better, too. I think that those of us who like to have special number plates recognise that the £5 charge is not enough, and certainly something could be done there. However, I hope it will be possible for the Government to say that it is not their intention to make the transfer of such number plates impossible. We have too much conformity nowadays. Perhaps if people want to have one or two number plates, they should be allowed to have them.
5.51 p.m.
Lord HOUGHTON of SOWERBY: My Lords, I am very glad to hear from the last two speeches made from the Benches opposite some approval of what the Government are doing to preserve the heritage of our country and something of its historic buildings. I do not think that the approval should come solely from the Benches opposite, where it might be thought that vested interests exist. I have no vested interest, but I have always been very keen indeed on conservation, and the preservation of the beauty and the history of our country, because if we once lose it it will never be recovered. I think that the creation of wealth is for more than the expansion of consumer goods and the provision of greater entertainment of the people. Governments have a responsibility to keep a balance in public expenditure between what people are demanding
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and what history will approve of and future generations will endorse, and today we can all see the failure of our ancestors to discharge that responsibility as fully as we would have wished. Therefore, I am glad to give my small voice of approval to that aspect.
I am not very much in favour of power without responsibility, and I am not much in favour of responsibility without power. That is why I do not think I shall enter into the general debate on the expenditure cuts or of the general economic situation this afternoon. The elected Members of another place have still to debate these cuts, and I think perhaps they should have precedence in leading the public debate upon them. My noble friend Lord Longford, as he spoke, brought back to me reminiscences of our joint experience in the Labour Government of 1964 to 1967. We then saw cherished schemes of social welfare go out of the window much more brusquely, with far less consultation, than the present Chancellor has recently extended to various interests inside and outside Parliament. I remember the minimum income guarantee which was established as a pledge beyond economic reach; that went in 1966 because we were anxious to restore world confidence in British capacity for economic recovery. In fact, let us beware; perhaps there are no obeisances that we can think of that may not yet be made in order to maintain world confidence in Britain's capacity for recovery.
I do my best to be enthusiastic about membership of your Lordships' House, but I notice that not much public attention is given to what we say unless it is in a field in which we have some power, which is mostly in matters of legislation. Then of course there is an interest in whether we, in your Lordships' House, are going to pass, amend, or reject what comes to us for consideration. I acknowledge that there are occasions when our debates do excite a considerable amount of public interest, especially on the moral issues of the nation, when we become a kind of secular synod of the Church of England and dwell upon the moral decay of the country, and forget perhaps the strides that we have made in the lifetime of most of us in raising the standards of the people and uplifting a sense of moral obligation to the poor and the needy, the disabled and the old. However, that

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is for another day. We shall perhaps continue that some other time.
Of course, if the captains of industry were here to give their counsel to the nation, to point the way to this recovery which we are now hearing about, and here to tell us how we can forge ahead and turn the Chancellor's cuts in public expenditure into economic progress, then no doubt the people would listen. But they are not here. Those who command the heights of the private economy are not here; still less those who command the heights of the nationalised industries. So we have to manage without them. The truth of the matter is that nothing that the noble Lord, Lord Carr, or I, may say this afternoon is going to make anything like the impact upon public opinion that would come from some who are absent from our debate today.
However, I want to refer to a matter on which I interrupted my noble friend Lord Jacques, which was on one of the Chancellor's proposals; namely, to restrict the title to unemployment benefit of certain people who are enjoying substantial occupational pensions. He responded to my interjection with a warmth of feeling which moved us all. It enabled him to admit his virtue in not claiming for himself unemployment benefit when he was probably entitled to it. But let me remind my noble friend that this is old hat; it has been tried before. My noble friend Lord Collison, who I do not see on the Benches today, was surely a member of the National Insurance Advisory Committee which went into this matter years ago, and when proposals were made to curtail the right to unemployment benefit of the people we are talking about. But nothing came of it. Why? One reason was that the Trades Union Congress did not like it; another was that the Civil Service did not like it, another was that the Government could not find an acceptable way of carrying out the general principle. I should be very interested to see what comes of the Chancellor's reference to this matter again. We are, after all, dealing with men who are compulsorily retired before the age of 65.
Lord JACQUES: My Lords, would my noble friend give way? Not necessarily. In many cases they retire voluntarily.
Lord HOUGHTON of SOWERBY: My Lords, it is sometimes an open question as to whether you retire voluntarily or whether you go out with your honour and dignity. One can think of all sorts of people who are going "voluntarily", but their going is not so voluntary as it looks. However, I shall not dwell on that. I shall deal for a moment with those who are compulsorily retired before the age of 65 and who—and this is the rub—are required to pay quite substantial national insurance contributions in order to ensure their State pension. I can tell your Lordships that many of these people are much more concerned about getting their insurance contributions franked than they are in getting unemployment benefit. However it is something which I am sure we shall have to deal with later, because it will involve legislation and noble Lords will then have the opportunity of dealing with it.
I want to come now to the point which is of especial interest to this House, and which was raised by the noble Lord, Lord Harmar-Nicholls. I hope that it is no secret that he and I have had lengthy conversations about this matter. I am not dissuaded in my support of Lord Harmar-Nicholls because we are both supported by the noble Lord, Lord Wigg; there are some things even in this House that one has to put up with, and one of them is the support of Lord Wigg.
If we had a Privacy Act or a Bill of Rights I should hope that all the rights of the citizen would be embodied in a comprehensive protection clause of the rights of the citizen to be free of unnecessary intrusion or the breach of the threshold of his home. But as it is, we have these rights of coercion and of entry spread around the whole field of legislation, and sometimes I think that the citizen does not realise what nibbles have been made in one Act of Parliament after another at his inalienable rights to enjoy life free from the intrusion of police or bureaucracy. This proposal in Schedule 6 owes its existence as much as anything to the fact that similar rights, but in entirely different circumstances, were conceded at the time of the introduction of VAT, because I have heard Revenue people say, "We are asking for ourselves only what has already been conceded to the Customs and Excise in VAT" That shows the

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danger of legislation by the thin end of the wedge, and one has to be on guard against one thing being conceded because it will be taken as a precedent for another.
I pointed out in a letter to The Times on 21st May that VAT and income tax are two entirely different things. The truth of that is that Parliament decided to conscript large numbers of traders into the field of tax gatherers; they have become enforced tax gatherers for VAT. They receive money from those with whom they do business and it is their responsibility to hand that over to the State. They are unpaid, involuntary and in many cases are perhaps not as efficient or as willing as they should be. Thus, when the Revenue, the Customs and Excise, claim the right of enforced entry to look after VAT, in many cases they are looking for the money. They claim that somebody is sitting on money which has been deducted or received from other people which belongs to the Revenue and has not been handed over. But Schedule 6 is an entirely different thing, so we must look at the two issues separately. We should try to safeguard the erosion of our responsibilities in this House on matters of this kind.
Schedule 6 to the Finance Bill seeks to amend not the Income Tax Acts, not previous Finance Bills, but the Taxes Management Act 1970. Lord Harmar-Nicholls will recall that year after year in Finance Bill debates in another place I asked for administration to be brought into a separate Statute so that our debates on the Finance Bill were not crowded out with details of administration when we wished to debate at greater length matters of taxation.
Lord HARMAR-NICHOLLS: My Lords, until 1911 that is in fact what happened.
Lord HOUGHTON of SOWERBY: Lord Harmar-Nicholls took the words out of my mouth, my Lords. That is indeed what happened, and we now have the Taxes Management Act. The administration provisions are there and Schedule 6 is proposing to amend that Act, which is where the mischief comes. As we know, the proposal first of all was that, on the certificate of a justice of the peace, a right of enforced entry warrant could be given to an inspector of taxes who had declared on oath that he
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had reasonable grounds for suspecting that a fraud had been committed. I think that rights of enforced entry into people's premises, and especially into their homes, are bureaucracy, not police, and should be very cautiously granted because in many cases those concerned are not equipped for it and they are probably inexperienced in this manner of entry into other people's property.
The main question that Lord Harmar-Nicholls was discussing was whether, by this device of a Schedule to the Finance Bill to amend the Taxes Management Act 1970, matters of importance to us should be put beyond our reach. If we are not the guardians of the basic rights of the citizen, what purpose have we? Surely that is what must be conceded to this House, to both Houses jointly, when it comes to a matter of the invasion of the privacy of the citizen. It can be argued that, like the barmaid's child, it is only a little one; that it will be used only in a few cases and that they will be dreadful ones—that any person with any moral feeling about him will concede that we have the right not only to enter the man's home but to cast him into goal without very much ceremony. That argument has always been used far eroding the rights of the citizen—"We will do it only in the extremity". I believe there are some cases—I am not saying that this is one, although perhaps it is—where the cure is worse than the disease, and that it is far better to retain one's rights than to give them away because one is persuaded that there is a small number of cases which require that sort of treatment.
Before I resume my seat I wish to refer to a further possibility in this direction. Just recently we had the Report of a Royal Commission on standards of conduct in public life presided over by the noble and learned Lord, Lord Salmon. I was a member of that Commission, which has made some recommendations in the Majority Report and some in the Minority Report which impinge on the rights fo the citizen and which would propose to give new powers to the Inland Revenue; the power, in the case of the Minority Report, to take the initiative in transferring to the Director of Public Prosecutions genuine suspicions of corruption—nothing to do with taxation but with other walks of life.

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Would that be tacked on to a Finance Bill? Would that be regarded as the powers or the duties of the Tax Inspectorate, and also as a suitable item for inclusion in a Finance Bill? If so, would it, again, be put outside the power of this House to have something to say about it? Or would it be included in another Bill on which we should be free to express our point of view? I say no more about that, except that it shows the danger unless we take note of any tendency in this direction.
My Lords, while I am not in favour, nor is Lord Harmar-Nicholls, of impeding the progress of the Finance Bill on this occasion, it is as well that we have had our say. We hope that what we have said will be read in another place and that in future we shall have proper respect given to this aspect of our work. In the meantine, I hope that this matter can go for examination to the Committee for Privileges and that in due course we will have a report on this most important subject.
6.10 p.m.
The Earl of GOWRIE: My Lords, we have just listened to a remarkable speech, from a very informed source, about the defence of liberty, and I shall refer to one or two points that the noble Lord made later in my speech. I should like to start by apologising in a most heartfelt way to the noble Lord, Lord Jacques, for missing his opening speech. This was unpardonable in somebody who was due to wind up, but I had an engagement that I could not break unless those who do not wish to cut public expenditure choose to subsidise Opposition spokesmen rather than leave them to their own resources. As I am not one of those, I had, unfortunately, to be absent for a few minutes this afternoon.
There should, I feel, be a festive, end of term feeling in your Lordships' House at this time of year, but I cannot honestly say that I detect it. For the second year running, the Government's handling of its Parliamentary programme means that our plans for our holidays and—perhaps more important—our plans for getting on with our own work and earning our own living have been disrupted. If the House of Commons wants a full time professional
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House of Lords or Senate, it has only to say so. It has the power, subject to your Lordships' consent to create one and, knowing the effect which constant legislative changes have on the productive capacity of the country, perhaps the Government could get the International Monetary Fund to lend them the money to create one.
We in this country are really confusing policy with legislation. We are trying to do too much lawmaking in too little time and with far too little professionalism I feel that we should compare the European and American Parliamentary systems with our own in this regard. I know that we have a civil service to be proud of but, at a time in history when the involvement of Government authority in individual lives and livelihoods is greater than at any peacetime period in our history, we need a much more modern, up-to-date and efficient Parliamentary system than we have at present. It is strange that the persistent increase of public service manning at local and national levels has been accompanied in recent years by a persistent decrease in the effects of Parliamentary advice or scrutiny. Perhaps it is not so strange because the imbalance suits the Executive, whether it is struggling to put into effect a frequently irrelevant or outdated Manifesto or whether it is in hock to one pressure group or another.
When we were in Government, I thought that we were on occasion cavalier towards Parliament. But compare the parliamentary "going-over", if I may put it that way, which the Industrial Relations Bill received with the far more skimpy and desultory treatment that Bills of greater economic and structural import are receiving under the present Government. Consider the Dock Labour scheme alone in this regard. Of course, in some ways I welcome the scheme. It is furiously resented by other groups of workers and it will do wonders for the Tory vote among workers without which no Conservative Administration can or, in my view, should take office.
The progress of the Finance Bill in another place makes a fascinating case for Parliamentary reform and for the need for much wider consultations before a Bill is drawn up, as against the frantic scramblings and unscramblings while it is being pushed through. In this House, where Finance

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Bills are concerned, we have, as many speakers have said, a rather different role. I shall come to the very interesting points and proposals of my noble friend Lord Harmar-Nicholls at the end of my own brief contribution if I may. Conventionally, though not, I believe, constitutionally, we do not refuse Finance Bills a Second Reading, and we cannot amend Money Bills, dearly as we might like to. Instead, we use Second Reading as a general economic debate.
Your Lordships have heard a notable speech from my noble friend Lord Carr this afternoon and the House heard a notable speech on the general economy and the state of the nation from my noble friend Lord Carrington two weeks ago. In my role as a second violinist—I do not feel that one should talk about "second fiddle" where a Finance Bill is concerned—I have contributed, I believe, to all but two of the economic debates in your Lordships' House since February 1974.
So I do not want to make my old speech again, except to say that I believe that its general theme remains quite relevant. It is, in brief, that the economic problems and the economic opportunities of Britain are compounded and thwarted by British political life and by our political institutions, long and honourable though their history may be. The Conservatives learned—and learned the hard way—that their political aims in the industrial relations field—aims which I, for one, still find entirely reasonable, unrepressive and in line with the sensible practices of our competitors—were a stumbling block to their also reasonable desire to go for growth in the economy.
I contend that the Labour Government and, above all, the Labour Party have not learned and are not learning the same lesson. They believe that prosecuting in Parliament a series of political measures—whether dock labour, pay beds, community land, the nationalisation measures or the taxation clauses of the present Bill—will command such a measure of political assent from the unionised work force in the country that our poor industrial relations performance will improve, our productivity will increase, wage claims will proceed on an orderly basis and our national competitive position will get better. I do not see a whit of evidence that this is the case. When will we in
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Parliament learn that people are not idiots? As the noble Baroness, Lady Seear, said in her speech, the general public are aware of the effects of excessive expenditure. They do not need politicians to tell them that.
It is, it seems to me, part of the conventional wisdom of the Government that the present wage restraint policy or restrained prosecution of wage claims is engendered by the kind of legislative trafficking which I have mentioned. Surely it is not. When the Wilson Government abandoned the Heath Government's pay policy though not, of course, the threshold agreements nor the mechanism for price restrictions, wage inflation rose sharply because anyone with any sense—and that included the vast majority of working people in the country—knew perfectly well that a wage restraint policy was needed and would sooner or later be reimposed. Therefore, a scramble to re-establish differentials resulted and that at a time when we were still reeling under the effects of the oil crisis. That, too, at a time when the Government had committed themselves, in order to keep the Labour Party in good fettle for the October election, to a very expensive and damaging legislative programme.
If your Lordships think that I am being too partial, let me give another instance from our own side. Your Lordships will remember all the political fuss and brouhaha about property speculation. My noble friend Lord Barber brought in draconian measures to deal with property speculation late in 1973. The Wilson Government then added to them after March 1974. But property, in one form or another, is the underpinning of credit in Western economies. If you go and ask your bank manager for money to expand your productivity, nine times out of 10 he will take a lien on your factory, your office or your home. So the political attack on property speculation which was for the most part contained by the physical area of the City of London, I suggest, helped to undermine the entire credit stability of enterprises all over the country at a time when interest rates were rising very steeply because of the oil crisis. This did us incomparable damage at home and abroad. If, in the Federal Republic of Germany, say, you do not like a set of political attitudes or a group of people or

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certain practices in the economy, you say so; you draw upon public opinion to support you and you bring public pressure to bear. But you do not set fire to the stables by legislation after the horse has bolted. In any case, it is in the nature of speculators to be very fleet-footed indeed.
We must not think that our creditors overseas understand our Parliamentary and political ways quite as well as we do. We know perfectly well that, when the trade union leaders pledge implacable opposition to cuts in the social wage and threaten a free for all on the wages front if public expenditure is reduced, they do not really mean it. But foreigners do not know this. They see a Government legislating to please a small handful of union leaders, and so the normal cut and thrust of union politics makes them edgy about the pound. They see a Government laboriously leaking and educating its Party in proposed future cuts in its own expenditure.
Then the proposals are announced, no one resigns except two Scottish Members of Parliament (who do not really resign anyway) and the Government do not fall. Surely, the pound should then zoom upwards, in Mr. Jack Jones' excited phrase, but it does not because foreigners, in my contention, are no more idiots than the people of the country. They examine the cuts and see that they are simply a rerun of what we might call "1966 and all that"—better than nothing, but nothing very much. They do not see what they are looking for; not cuts for the sake of cuts, as my noble friend Lord Carr of Hadley said in his speech, but a restructuring of central and local expenditure so that it bears a less inflationary relation to national productivity and consumption. In better English this simply means paying your way and living within your means, including, for of course we do need credit, living within our overdraft facility.
My Lords, 1984, you will remember, was not only the year of Big Brother. It was also the year of double-think. Thank goodness the Chancellor is not yet Big Brother, but he is certainly a master of double-think! About half of his package of cuts turn out on inspection to be increases in company taxation. With 1½ million people unemployed he takes
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another whack at the employers—nearly £1,000 million in extra taxation on the corporate sector through National Insurance contributions. Yet the whole point of reducing public expenditure is simply to enable you not to increase taxation further with the damaging effects that that implies.
What effects do noble Lords opposite think that will have on our employment opportunities or on companies who might take on school-leavers, for instance? What effects will that have on investment and on those overseas who effectively promote investment by holding on to our currency? How do we think the double act of the Chancellor and the Prime Minister will go down?—I guess like the pound, unless we are lucky. The Prime Minister, with the economists Messrs. Bacon and Eltis at his elbow, talks of the need, and says that the unions echo the need, to shift resources into the producing sector. The Chancellor, to protect the consuming and service sectors, slaps £1,000 million on to the producers. If I were my noble friend Lord Watkinson I would go slow, or sit-in, or walk out. I think that this will have incredibly damaging effects on the investment agreements reached with the CBI.
Do we really think that our creditors do not notice the shambles of a policy which seeks to cut public spending, on the one hand, while not allowing people to contribute towards public services, as in the pay beds dispute, on the other? It is back, I agree, to my old theme, the old irreconcilable of politics. We are politicing rather than housekeeping. To control wages we have to control prices. The control of prices hits profits, hits investments, and therefore hits jobs. I just do not believe that working people on both sides of industry do not appreciate this. We must learn to trust them which is only to say that we must learn to regain the confidence to trust ourselves.
I want to make a final point about the notable speech by my noble friend Lord Harmar-Nicholls. I had the great interest and privilege some years ago to attend the Ditchley Conference run by the late Sir Kenneth Younger (to whom I pay every tribute in this regard) on the question of privacy in this part of our century and in our national life. I acknowledge that there is a very strong vein of feeling

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among noble Lords opposite that privacy and individual liberty must not be jeopardised. This was a vein which we heard in the speech of the noble Lord, Lord Houghton of Sowerby. I wish I could say that I felt that this feeling were echoed by some of their colleagues in another place.
I acknowledge the difficulties which we all, on both sides, have on the question of entering to pursue possible tax evasions. I do not shun the fact that it was a Conservative Government which introduced VAT entering on this level. I should say that there has been considerable pressure from the Opposition in another place to amend this into a half-way acceptable form, and my noble friend Lord Massereene and Ferrard spoke of this in his intervention. But I should also say that we must he extremely careful on all sides how far down the road of increasing powers of entry we should go. It seems to me that our police force is still the best force for being issued with powers of this kind.
We must also be watchful about evidence we have of the increasing "politicisation" of the Revenue service. But surely the most important thing to avoid these problems is to get our taxation back on to reasonable levels. My right honourable friend—I speak in a personal sense—Mr. Grimond made a remarkable speech on this subject on the Third Reading of the Finance Bill in another place when he attacked the way we were becoming a perk-led or fringe benefit economy.
I agree that it should be right that the House of Lords should be a watchdog in this regard. But it is also right, as my noble friend Lord Harmar-Nicholls acknowledged, that the position of the Speaker of the House of Commons, not just towards the House of Commons but towards the whole Parliamentary system, should be honoured and acknowledged. Certainly my noble friend Lord Harmar-Nicholls is not a lap-dog of the Tory Party or of Parliament, but a watchdog—to adapt the phrase of the noble Lord, Lord Wigg. However, I am glad that he has decided not to bite this afternoon, even if he has given us a good taste of his teeth, and I acknowledge his right to do so.
6.27 p.m.
Lord SHEPHERD: My Lords, today's debate has fallen into four parts: the Finance Bill; the cuts—whether they were right, whether they were needed, whether they have gone far enough; semi-philosophical discussion about the future of the country; and then the interesting point, raised by the noble Lord, Lord Harmar-Nicholls, on the question of "tacking", in relation to which I saw very strange support from my noble friend Lord Houghton of Sowerby and the noble Lord, Lord Wigg. This is a notable experience and raises severe qualms about what I should say at the end of the debate to the noble Lord, Lord Harmar-Nicholls.
So far as the Finance Bill is concerned the noble Lord, Lord Carr of Hadley, said (with some justification, I suppose) that the Bill, when initially introduced, was ill-formed. He used the word "incompetence", which I would not accept, but I would accept the term, "ill-formed". Whenever there is any major change in the finance field it takes many years of refinement to get it right, and I should have thought that it is no criticism of another place, or of the Government, that as a consequence of good, hard debate, not only in Parliament but outside, that one had succeeded in making a major improvement. I suspect that in relation to some of these taxes it will be a case of a number of years of continued refinement.
I can only say to the noble Lord, Lord Carr, that the Act which will be associated with him might in this way have avoided very many of the difficulties that it faced. At the end of the day I would accept that 80 to 90 per cent. of that Act was a good Act. It was that small 10 or 15 per cent. which damned it. If the House of Commons and the Government of the day had listened with a little more care to some who had vast experience in the trade union field, speaking in this House, not in a political sense, and if consideration had been given to what they said, I think we might have had a completely different reaction to that legislation. I take the view that this is what Parliament is about. It is debate, it is the improvement of legislation, and above all else it is the willingness of Government to listen and also for Parliament to recognise from

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time to time that there is an area beyond which the Government, for obvious, practical, political reasons, cannot go.
My Lords, I think the noble Lord, Lord Carr, did not have any deep criticism of the Finance Bill, except of Schedule 6, which he referred to as containing "snooping powers", and that I shall deal with later. The noble Earl, Lord Mansfield, and the noble Lord, Lord Montagu of Beaulieu, spoke about the national heritage and the improvements that the Government have provided in the Finance Bill. The noble Earl, Lord Mansfield, asked whether we would continue to keep this under review. The noble Earl should see what my right honourable friend Mr. Robert Sheldon said, as Financial Secretary at the Treasury, I think on 15th July, when he gave a very firm assurance that this would be kept under continual review. As regards perpetuities, I am advised that it does apply to Scotland. Certainly it does to England. I will check and write the noble Earl, but I am assured that it does apply to Scotland.
In regard to the cuts, my noble friend Lord Longford raised a question about whether the cuts were necessary. The noble Lord, Lord Carr, felt they were necessary, that they were a first step, though perhaps inadequate. I think the House ought to be reminded of the position of my right honourable friend the Chancellor of the Exchequer throughout his period of office in regard to public expenditure. There has been a continuing campaign by noble Lords opposite and by their Party for major cuts in public expenditure. We have taken the view that, in a period of deep recession such as that through which we have gone, it would be quite wrong to cut public expenditure, with all the traumatic consequences which would follow in the field of employment. We announced last year a cut in public expenditure of some £3 billion for the purpose of making resources available as industrial progress was made, but we took the view then that, so far as 1977 and 1978 were concerned, there was not a case on grounds of the movement of resources for a cut in public expenditure, My view is that that is still true. I do not myself believe that there is any pressure upon resources in this country at the moment;
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nor do I anticipate a strain on resources of such a character, at least, that there needs to be a shift from the public sector into private industry.
However, there is another factor which has borne very heavily upon us in recent months. The economy in the country has developed a good deal faster than we had anticipated earlier in the year. This therefore means that industry will be requiring further sums for investment. To achieve that, we have got to restrain the public area in order that the sums that are saved can be made available for private industry. So there is, I believe, an undoubted case for the cuts that were announced by the Chancellor last week. There is also another reason, and the noble Lord, Lord Carr, touched upon it himself. The public sector borrowing requirement is very high. In my view, it is unacceptably high. It has been left at that figure because we have sought to avoid all the consequences of recession. But I believe, and the Government believe, that steps should be taken to reduce the public sector borrowing requirement. We believe that we can see a reduction, through an upturn in the economy, of the order of some £1 billion, but the rest has to be found by restraint or by imposition through taxation.
I take the view—and I think most noble Lords would agree—that it would be quite wrong to look for such a change in the field of taxation. In fact, I do not believe that the taxation system would bear it. Certainly it would be counterproductive in the field of pay policy. I have also to say to the House, having gone through the exercise of finding this £950 million plus other savings, that it is one thing to talk about cutting public expenditure; it is another thing to do it, unless, of course—and I think the noble Lord, Lord Carr, was very close to it—you cut benefits. Then you can save money, you can save it dramatically and you can save it quickly, as the noble Lord, Lord Thorneycroft, I am sure, would agree. You can cut pensions, unemployment benefits and all that goes with it; but when you start to cut into the normal machinery of government, whether it is of central Government or of local government, then it is a very difficult task.
The noble Lord, Lord Carr, was quite right in saying that we anticipate that

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some 60,000 jobs will be lost through the cuts themselves. In the main, they will be in the construction and service industries; and there will be, I suspect, something of the order of 12,000 lost as a consequence of the 2 per cent. on National Insurance contribution. I shall come back to that in a moment. My Lords, in our view we went as far as we were justified in going. We sought to protect housing, we sought to protect the essential road building programme, and we deferred where we could; hut, my Lords, we took the view that a £9 billion public sector borrowing requirement was an essential target, and therefore we had to look in the field of taxation.
As I said on the Statement announcing the cuts, we looked closely into this. We had to have in our minds the effect on the RPI. If we had done it through VAT it would have made a considerable impact on prices. If we had done it on cigarettes or drink—for which there is a very strong case—that, too, would have made a major impact on prices. We took the view at the end that this was the best way of doing it. It would have a marginal and early effect on industry but taking into account the buoyancy of industry and commerce and what was being done in the Price Code field, the increase could be borne by industry without any serious consequences. I must say—and I hope that noble Lords opposite will convey it to the noble Viscount, Lord Watkinson—that I can understand his initial reaction and that of his colleagues at the CBI; but all sides in the country are being asked to bear a special burden here. The CBI and industry have not been isolated from the impact and the cuts that are going to affect them.
I hope very much that the spirit that existed—and which, I believe, still exists—between industry, Government and the trade union movement will be very quickly restored and that the plea for investment that the noble Viscount, Lord Watkinson, had in mind to make to industry will be made. I hope it will be responded to; because investment is the kernel of the economic development of this country.
My Lords, all sides are being asked to pay a heavy price. I agree with the noble Baroness very much when she referred in the course of the debate—as did the noble Lord, Lord Carr—to the need to maintain
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the degree of co-operation and confidence between the Government and the trade union movement. The noble Lord, Lord Carr, recognised the tremendous opportunities that have now been provided because of the new climate through pay restraint. I agree with the noble Baroness that the re-entry is going to be more difficult. We must certainly devise ways and means by which there are incentives and differentials and certainly, if it can be done, to meet the undoubted case so far as middle management is concerned.
However, we have got to maintain this climate of co-operation. This has been very much in the mind of Government throughout. We have need to maintain not only the spirit of co-operation of (shall we say?) management and the investor but also of the work force and their representatives. It is not always easy but I believe that we should carry on; although there has been criticism of the extent to which the Chancellor has gone out of his way to consult the various bodies before a decision was taken. But I believe that this is the only way—certainly at this time—in which this country can be governed. It creates difficulties for Parliament for it appears as though decisions are being taken and matters are being negotiated elsewhere which normally are done on the Floor of the House, but I believe that it is essential to bring the three pillars of the Estate together and in continuous consultation.
Lord CARR of HADLEY: My Lords, the noble Lord mentioned the care with which the Chancellor of the Exchequer consulted. Could he say whether the CBI were among those consulted since such a vast amount of the package fell on their members?
Lord SHEPHERD: My Lords, I understand the Chancellor did see the senior executive—I believe it is the Director General—of the CBI certainly before decisions were taken by Cabinet. That is my understanding.
My Lords, I do not think there is need to say a great deal more. We are going to return to this matter, no doubt, in the Recess and also to some of the alternatives which the noble Lord, Lord Carr, deployed about the use of public funds and the shipbuilding and aircraft industry. The

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noble Lord, Lord Carr, was free to acknowledge that whether we nationalised the shipbuilding industry or not, very large sums of money would have had to be found for that industry. I do not know whether noble Lords would dissent from it; but I, personally, when it comes to very large sums of money, would prefer to buy the equity and have some say in management rather than merely to provide large sums of money to the shareholders of companies who may fail to exercise their responsibilities in the conduct of those companies.
I now come to the noble Lord, Lord Harmar-Nicholls. If I may say so, this is one of the more interesting points on procedure raised during my period as Leader of your Lordships' House. The noble Lord has acknowledged that this Bill is now a Money Bill under the Parliament Act 1911. I think I ought to say a few words about what this means to this House. First, it means that the Bill can be given the Royal Assent at the end of one month, whether or not this House passes it. Secondly—and I hope the noble Lord, Lord Harmar-Nicholls, will agree with me—Mr. Speaker has, in effect, given his Certificate that there are no tacking provisions in this Bill. I would quote Section 1(2) of the Parliament Act at length because it lays down the conditions which must apply before the Speaker can give his Certificate:
"A Money Bill means a Public Bill which in the opinion of the Speaker of the House of Commons contains only provisions dealing with all or any of the following subjects, namely, the imposition, repeal, remission, alteration, or regulation of taxation; the imposition for the payment of debt or other financial purposes of charges on the Consolidated Fund, or on money provided by Parliament, or the variation or repeal of any such charges; supply; the appropriation, receipt, custody, issue or audit of accounts of public money; the raising or guarantee of any loan or the repayment thereof; or subordinate matters incidental to those subjects or any of them."
Section 3 of the Act says:
"Any certificate of the Speaker of the House of Commons given under this Act shall be conclusive for all purposes, and shall not be questioned in any court of law."
Mr. Speaker has certified that this Bill deals only with the items that I have mentioned; namely, taxation, supply, and subordinate matters incidental to those subjects. I am not suggesting it—I could
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not do so—but the way in which the noble Lord mentioned it in his earlier Motion could have been construed as a challenge to Mr. Speaker. What we are now dealing with is a Money Bill, whereas it could have come to us as a Supply Bill alone which would have produced a slightly different situation.
The real question is whether Schedule 6, that is, the investigatory powers of tax inspectors, is foreign to and different from the matter of the Bill. That is the kernel of it. First of all, it is within the Long Title of the Bill. The noble Lord will agree to that. It has been accepted by the authorities in the Commons to be within the scope of a Finance Bill. My Lords, if it had not been, and you wanted to put some foreign matter into the Bill, it could be done in the House of Commons quite responsibly and respectably. There is a procedure for including in Finance Bills provisions which are normally outside their scope. This is done by means of a procedural resolution; but in the case of Schedule 6 no such procedural resolution was considered necessary because what was in Schedule 6 was not thought to be outside the scope of the Bill.
Regarding the scope of a Finance Bill, Erskine May (page 791) says that it:
"is not limited to the imposition and alteration of taxes for the purpose of adjusting the revenue of the year. It … normally includes many provisions of a permanent character for the regulation of fiscal machinery and other purposes."
I think the noble Lord, Lord Harmar-Nicholls, agreed that the House of Commons has been scrupulous in avoiding tacking. There has been no successful accusation of tacking since 1807, and the Commons attitude is summarised in Erskine May (page 802) as follows:
"As for the modern equivalents of Bills of aids and supplies, namely, Consolidated Fund and Finance Bills, the rules of order of the House of Commons exclude the possibility of foreign matter being tacked to such Bills by way of amendment; and respect for constitutional practice prevents the inclusion of such matters among their original provisions."
The Schedule is well precedented by, for instance, Clause 37 of the Finance Act 1972 relating to the entry and search of the premises or persons in connection with VAT. There are other powers of entry in the Betting and Gaming Duties Act 1972 (consolidating earlier Finance Acts), and the Finance Act of 1967 on SET.

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I cannot help but feel that the distinction of the noble Lord, Lord Harmar-Nicholls, between assessment of taxes and the collection of taxes is, if I may say so, meaningless. The important point is that they are both concerned directly with taxes and are therefore not foreign to the matter of the Finance Bill. I could not do better—and it is a strange afternoon—than to refer to a rather unlikely authority, that of an Archbishop of York, who spoke on the notorious Finance Bill of 1909, when accusations of tacking were made. He said:
"I find it difficult to believe that the procedure for the assessing of a tax is foreign to that tax itself".
It seems to me that the noble Lord is trying to create a new definition of what tacking is. The rule originated from the procedure of putting together in the same Bill clauses that have no relation to each other and the subjects of which are entirely different. The kind of situation which the Standing Order was designed to meet was, for example, that of 1704 when the Tories—then rather different from the Tories of today, but Tories none the less—tried to tack clauses about Dissenters to a Land Tax Bill. The last occasion when tacking was successfully invoked, in 1807, involved a Malt Duty Bill to which a clause legalising Exchequer Bills charged on pension duties was added, and an Irish Customs Bill to which a clause on foreign compensation was added.
What we are proposing in this Bill has no real relationship to what Standing Order No. 49 was designed to prevent. I agree with my noble friend Lord Houghton and, in a lesser degree, with my noble friend Lord Wigg, that Parliament always ought to be watchful about the way the Executive may encroach upon individual freedom. It could be done accidentally and without intention. I am a little nervous about Standing Order No. 49 and what we should do about it in relationship to another place. I have no doubt at all that the question of tax, how taxes are raised, regulated and assessed, is a matter for the House of Commons. I would not wish this House to be put in a position of challenging that right. There is a risk therefore in going into Standing Order No. 49 that, by some strange quirk, we may well create a problem between the two Houses.
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When I discussed this matter informally with the noble Lord, Lord Harmar-Nicholls, I had at the back of my mind the idea of sending this to the Committee for Privileges because this is a matter of privilege. The more I thought about it the more I could see it impinging upon another place, and I came to the view that that would not be the correct Committee because it would be a Committee sitting (shall I say?) as the House of Lords in isolation.
If it is the wish of the House that Standing Order No. 49 and matters relating to it should be considered by a Committee, the new Committee which has been set up on Parliamentary Procedure would be the right one. I will tell the noble Lord, Lord Harmar-Nicholls, why: the House of Commons are setting up an identical Committee and both Committees have power to meet together, so this is a matter which can best be considered by the two Houses in that Committee. It does not restrict our later attitude to it.
I do not think a resolution is necessary. This matter can be referred immediately to the Chairman of our own Committee, so that it can be considered and proceeded with between the two Houses. In saying that, I want to make it absolutely clear that I do not believe there is any question whatsoever of tacking in this piece of legislation. I would not wish it to be thought that, by expressing a willingness for it to be considered, I am in any way accepting some of the things which have been said or written by certain noble Lords in this respect. I believe the position of Mr. Speaker needs to be protected, though in fact he is already protected because I believe he has acted on the best advice.
6.58 p.m.
Lord HARMAR-NICHOLLS: My Lords, the noble Lord has been generous and responsible. The suggestion that he has made is one we ought to consider and perhaps follow. From my point of view I should like to think about it; on the face of it it looks right. The only reason I rise again is because I still believe that both Houses have inadvertently run against their procedures. If the noble Lord looks at the matter again in detail he will find there is a difference between assessment and collection of taxes. None

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of the examples he gave as to the way it has been dealt with in the past referred to people's own money; it was only when they have been holding other people's money. I thank the noble Lord for the thought that he has given to this matter; the suggestion he has made certainly enables me not to move the Motion standing in my name on the Order Paper, and I should like to feel the outcome will be as he has suggested it might after consideration by the new Committee. my only concern is that our rights are properly preserved.
Lord SHEPHERD: My Lords, I thank the noble Lord. I am glad that I have met the concern of the noble Lord, but I hope that the conditions under which I have done so are clear. We have a lot more business yet to do, and I apologise for having spoken a great deal longer than I intended. I hope that the House will now give this Bill a Second Reading and allow all its remaining stages to be proceeded with.
On Question, Bill read 2ª: Committee negatived.
Then, Standing Order No. 43 having been suspended, pursuant to the Resolution, Bill read 3ª, and passed.
Lord HARMAR-NICHOLLS: My Lords, I do not intend to move the Motion standing in my name on the Order Paper; viz:
"To move, That the operation of Standing Order No. 49 (No Clause to be annexed to a Bill of Aid or Supply foreign to the matter) be referred to the Committee for Privileges."

DOCK WORK REGULATION BILL
Brought from the Commons; read 1ª and to be printed.

JUNIOR MINISTERS' AND OTHER SALARIES ORDER 1976
7.2 p.m.
Lord SHEPHERD Lord SHEPHERD rose to move, That the draft Junior Ministers' and other Salaries Order 1976, laid before the House on 14th July, be approved. The noble Lord said: My Lords, I beg to move the
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Motion standing in my name on the Order Paper. The House will be aware that my right honourable friend the Lord President announced in his Statement in the other place on 12th July about MPs' pay that the Government proposed that Junior Ministers and Office Holders in both Houses should receive a supplement of £6 a week under the current pay policy, if their total earnings from all sources do not exceed £8,500 per annum.
In the case of all eligible Members of the other place, the increase will be applied to Parliamentary salary. In the case of Peers, the increase has to be applied to salaries drawn as Ministers or Office Holders. The draft order now before this House is designed to achieve that end. A Peer holding any of the posts covered by this order will be eligible for the increase if his total earnings from all sources do not exceed £8,500. The payment of the increase will therefore be subject to confirmation that any other earnings he may receive—and I stress the word, "earnings", which can include income from, for example, directorships, salaries, appointments and professional fees—together with his existing salary under the Act do not exceed £8,500.
There are two points about the order which call for special comment. In the first place, it includes the Solicitor General for Scotland who is not a member of either House. His salary as a Law Officer of the Crown is, however, governed by the Ministerial and Other Salaries Act which this draft order seeks to amend, and must therefore be included in the order. The second point is that the order has to provide for an increase in salary for all Parliamentary Secretaries, including those in the other place. In practice, only the two Parliamentary Secretaries who sit in this House will be eligible for the increase; namely, my noble friends Lady Birk and Lord Melchett.
Those who sit in the other place also receive a Parliamentary salary which in total puts their income over the £8,500 limit, and so their Ministerial salary will remain at £5,500 under the power in Section 4(2) of the Ministerial and Other Salaries Act 1975 which enables Ministerial salaries to be restricted. The draft order is subject to approval by Resolution in each House of Parliament. Approval was given by the other place on 23rd July.

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Subject to the approval of this House, the effective date of the increases will now be the date on which the order is signed by Her Majesty.
The salaries of the Ministers and Office Holders in this House are now out of date, having been fixed as long ago as 1st April 1972. Although the report of the Top Salaries Review Body, which will be published very shortly, recommends substantial increases, the Government do not propose to take any action on the report until incomes policy permits. The Government are in no way committed to implementing the Review Body's recommendations. The proposed increase, which is the maximum permitted under the current policy, is a modest measure that does not do full justice to the Ministers and Office Holders concerned. But it nevertheless will serve at this time as a limited token of recompense for all the onerous duties which they perform. I commend the Motion to this House accordingly.
Moved, That the draft Junior Ministers' and other Salaries Order 1976, laid before the House on 14th July, be approved.—(Lord Shepherd.)
On Question, Motion agreed to.

STORNOWAY HARBOUR ORDER CONFIRMATION BILL:
Considered on Report.
Lord SHEPHERD: 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 Stornoway Harbour Order Confirmation 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.
Then, Standing Order No. 43 having been suspended, pursuant to the Resolution.
The MINISTER of STATE, SCOTTISH OFFICE (Lord Kirkhill): My Lords, I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read 3ª.—(Lord Kirkhill.)
On Question, Bill read 3ª and passed.

VALUATION AND RATING (EXEMPTED CLASSES) (SCOTLAND) BILL [H.L.]
7.7. p.m.
Lord KIRKHILL: My Lords, I beg to move that this Bill be now read a second time. Your Lordships may have noticed that in another place questions have been asked about the liability to local rates of offshore oilfields and installations and of the Forth and Tay Road Bridges. The Government have made clear their view that the two bridges should continue to be exempt from rates, and that oil installations which lie far out to sea ought not to be liable to local rates. The Bill now before your Lordships' House will allow implementation of the Government's intentions. Let us first consider offshore oil installations.
In Scotland—and the Bill is concerned only with Scotland—rating valuation is entrusted to locally appointed officials; lands valuation assessors. The assessor is under a duty to value and enter in his valuation roll the lands and heritages which lie within his area. The Local Government (Scotland) Act 1973 which set up the present local authorities defined their boundaries clearly, save in one important respect. Their seaward limits are not defined.
The practice of the assessor is to enter in the valuation roll any seaward subjects which he thinks may fall within his area. If the occupier appeals against the entry the issue will be decided, probably by the Lands Valuation Appeal Court in Edinburgh. The Forth Railway Bridge and certain coal measures off the Ayrshire coast were by this process held to be properly assessed, and quite recently the rateability of yacht moorings was likewise upheld. Two of our Scottish assessors have made assessments on certain oilfields, all lying many miles offshore on the Continental Shelf. The oil companies have challenged the assessors' actions and litigation is in train.
It may be asked why, if the assessors' entries are thought to be unfounded, the question may not be left to the courts. There are two main reasons for this. The first is that the Government are advised that the Continental Shelf is probably not within the area of any assessor, but that only a decision by the

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court, or legislation, can resolve the question. If the courts found that the entries were competent, the Government would have to introduce legislation to remedy the situation, because of the consequences of a large rate burden falling upon these installations in addition to corporation tax and petroleum revenue tax.
Since it is the Government's policy that taxation on offshore petroleum exploitation should accrue nationally and not locally, it seems preferable to move now to legislation rather than to await the outcome of complex and expensive litigation following which legislation might in any case prove to be necessary. The second reason is that a decision by the courts on the fields which have been assessed might not settle the position of other offshore subjects, so that the whole business might start again over some other field. This Bill would empower the Secretary of State for Scotland, subject to Parliamentary approval, to settle this issue and other comparable issues as they arise.
My Lords, I turn now to the Forth and Tay Road Bridges. Each bridge is administered by a joint board of the local authorities whose areas it links and in each case the local Act providing for such administration conferred on the bridge an exemption from rates. But when local government was reorganised, the Local Government (Scotland) Act 1973 swept away a number of local valuation and rating provisions, often antiquated, which would have brought unfairness and great administrative difficulties into the new rating areas. But this measure also swept away the rating exemption afforded to the bridges by local Acts. This Bill provides a means of restoring the exemption with effect from 16th May 1975; that is, the date from which rates are alleged to be chargeable. I put the matter thus because the assessments made on the bridges are under appeal and I must take care to say nothing to prejudge the issues raised by the appeals.
We have today these two types of property against which claims to rates have been mounted, claims which may or may not succeed, and tomorrow we may have others, as technology opens new ways of exploiting offshore resources.
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The assessors, who are independent under the law and not instruments of Government policy, may again seek to enter offshore subjects, so the Bill will confer on the Secretary of State for Scotland the power to specify by order, subject to Affirmative Resolution procedure, classes or descriptions of subjects which are not to appear in the valuation roll. The power extends to properties which are wholly or partly on, over or under the bed of the sea, by which is meant anywhere below low-water mark. The exemption may be conferred on a prescribed part of any generally described class of subject following consultation with affected interests.
My Lords, it may be assumed that upon the enactment of the Bill an order will be laid prescribing by general description public toll bridges administered by local authorities and offshore petroleum fields and pipelines to whatever extent may be considered proper. Thus the subects which have so far been assessed for rates—the bridges and the offshore petroleum installations—would be taken out of the valuation rolls. Once a class or type of property has been prescribed, no valuation will be competent thereafter. We would prefer to avoid a belated provision exempting any such new class. So the Bill provides that the assessor shall, subject to exceptions, assess no offshore subjects until he has duly notified the Secretary of State for Scotland and been advised that it is not intended to make an exemption order. Quite clearly there will be numerous classes of property which the assessor must be at liberty to deal with without going through the notification procedure. The Bill therefore empowers the Secretary of State to specify descriptions of property for which notice is not required.
Thus, my Lords, from the enactment of this Bill all subjects to which it applies will fall into one of three categories: first, subjects of a description which is exempt from valuation; secondly, subjects of a description which by direction of the Secretary of State for Scotland may be entered in the valuation roll just as they are at present; and, thirdly, subjects which, because they fall into neither of the first two categories, must be notified to the Secretary of State for Scotland before any assessment is made.

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There would be full consultation directed towards a comprehensive list of classes which will by order be exempt, and an equally comprehensive list of classes respecting which the notification procedure need not be applied. Then the process of notifications followed either by the Secretary of State for Scotland intimating that no order will be made or by the making of an order will be necessary only when the assessor intends to value some class of subject hitherto unknown—or, as is possible, something of a description which had been overlooked 'When the first order was made. As I said earlier, the Bill requires that any such order made be first laid in draft and approved by resolution of your Lordships' House and in another place. The Bill will have no effect whatever upon the boundaries of an assessor's authority, or on those of a local authority for any purpose. When the assessor is told by the Secretary of State for Scotland that no order will be made in respect of a certain subject, his powers and his duty to assess the subject will be unchanged. The courts will rule on any dispute in the normal way.
So this measure will implement the Government's policy—and I do not believe that policy has been seriously challenged—that revenues from the exploitation of our offshore resources should benefit the nation as a whole and it will retrieve a legislative oversight in 1973 which would otherwise adversely affect the finances of the Forth and Tay Road Bridges. And it will allow the quick and simple solution of any problems of a like nature which may arise henceforward. My Lords, I commend this measure to your Lordships' House accordingly.
Moved, That the Bill be now read 2ª.—(Lord Kirkhill.)
7.17 p.m.
Lord CAMPBELL of CROY: My Lords, we are grateful to the noble Lord, Lord Kirkhill, for his explanation of what must necessarily be a complicated subject. I understand that the Government decided to introduce the Bill into your Lordships' House at this late stage in the session because it is required urgently to clarify the situation, since we are dealing with a relatively new industry, the offshore oil industry, and with the Continental Shelf where there was much less activity before
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1970 than there has been in the last five years. I will say straight away that I do not regard this as a controversial Bill and that we, for our part, will try to assist the Government to pass the legislation, while examining it in detail to make sure that it is in as perfect a form as we can get it.
We were aware that local authorities in Scotland had been contemplating the rigs and platforms in the North Sea and eyeing them with a view to the rates which might be coming in. The noble Lord has told us that even the oilfields themselves have been regarded as possible subjects of assessment for rating. Certainly I agree that when the Oil Taxation Bill was passing through this House neither we nor the Government took into account the possibility of the oilfields also having to pay local government rates. Your Lordships will recall that the Oil Taxation Act introduced the petroleum revenue tax which is levied on each individual oilfield, not on the profits of companies. The Act takes into account the 12½ per cent. royalties which have to be paid on oil, but certainly it does not take rating into account. May I say in passing that we in Parliament considerably changed the original version of the petroleum revenue tax. Even in its final version our criticism from this Bench was that it was kind to the prolific oilfields which are fairly easy to work but that it would bear hardly on other marginal oilfields which the consortia might well find were not worth developing; that is, it would not be economic to get out the oil.
I should like to ask a question or two about the scope and policy. The noble Lord, Lord Kirkhill, indicated that the Secretary of State's present intention was to exempt the Forth and Tay road bridges, and I understood that this was one of the objects of the Bill, but when we come to other possible subjects I think there could be some difficulty about where the line is to be drawn. From what he said it seems that all the installations connected with the off shore oil industry are likely to be exempted from rates by the orders which the Secretary of State for Scotland would table. The noble Lord mentioned pipe-lines, and I think he mentioned rigs and platforms and the oilfields themselves, but what about terminals and jetties? What about platform construction?

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Last Wednesday, six days ago, I was at the inaugural ceremony concerning flooding the dock of the largest platform in the world at Kishorn in Wester Ross. That platform will move out into the loch considerably beyond the low-water line which is the important line so far as this Bill is concerned, and for about a year work will be continued to complete it where it is lying, a mile or two away from the coast. That is a construction job; that is nothing directly to do with the oil fields or winning the oil because eventually that platform, when completed, will be towed several hundred miles to an oilfield East of Shetland. Will that kind of platform construction and the various installations which are below the low-water mark also be exempted from rates, because they are connected with the oil industry although they are not, at that stage, more than a construction job being carried out by the building industry and the steel fabrication industry? Then there are other objects such as floating oil tanks. I think it would be helpful if the Minister could say whether it is the Secretary of State's intention to exempt in one of his first orders every kind of installational equipment which is connected with the off-shore oil industry.
Then, on policy, may I ask the noble Lord about other industries because, of course, there are jetties which are used by shipping and by fishing boats and for all I know some of these may already be the subject of rating where they extend beyond the low-water mark. I must also mention marine fish farming. I do not need to remind your Lordships that there has been considerable dismay, both in this House and in another place, that freshwater fish farms have not been exempted from rating although farming, agriculture, is so exempt. When we come to marine fish farming there are often cages below the low-water mark right out in sea lochs, containing many hundreds or thousands of salmon which are being fed and are growing. Are those cages and other installations connected with fish farming to be rated or are they to be exempted?
The Bill opens up a whole range of industrial and other subjects which might in future be categories which are to be exempted. So may I ask the Minister of State to tell us whether the Secretary of State is going to leave these matters for
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individual decision later? Is it his intention simply to exempt the Forth and Tay road bridges; to exempt (as I hope) everything connected with the off-shore oil industry and then to consider other categories or other individudual subjects as they arise?
Then I have another question, because accept what the Minister said: that the whole question of the Continental Shelf and its ownership and the control that a coastal State has over it, is changing. How far out will the Government in future expect the rating exemption or the rating to extend? At present our territorial waters extend for three miles. It is expected that the convention, when it is eventually agreed at the Law of the Sea Conference, will extend territorial waters to 12 miles. But from what the Minister said it sounded as though he was dealing with the whole Continental Shelf, and the Continental Shelf can extend even beyond the 200-mile economic zone, which again has been virtually agreed at the Law of the Sea Conference and is expected in a year or two to be ratified and put into effect by most, if not all, of the countries of the world.
So I entirely accept that legislation like this is needed because these changes are taking place, and when we have an economic zone of 200 miles which is internationally recognised the question of rating or exemption from rating may well arise in that area. Under the Geneva Convention by which the North Sea was divided up and allocated for mineral exploration, the seabed was not claimed, as I understand it, as part of the country. The arrangements by which frontiers were projected into the sea and median lines drawn and then drilling for oil and gas was to proceed in the North Sea, did not include claims for sovereignty over the seabed. It was simply the right to the substances lying in the seabed. Once Britain has a 200-mile economic zone presumably we shall have more control over installations and minerals in our part of the Continental Shelf.
Can the noble Lord tell us what will be the principles governing the allocation of subjects which are not exempted? How will it be decided within which local authority's area a subject will fall? For example, if there is some installation connected with—he mentioned yachts,

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but shall we say with vessels, and not connected with the oil industry, and it is some miles from the shore, there will presumably have to be a system by which the boundaries between local authorities are projected into the sea in order to decide in whose area the subjects lie; and there could well be disputes between local authorities on that matter. It could be done under the system between the countries bordering the North Sea by which the North Sea was divided up for the purposes of oil exploration. There is a formula and we could apply that. Alternatively, for dividing Scots law from English law in 1968 we simply drew a line eastwards from the Border. There will have to be some system if we are to settle disputes between local authorities as more and more activity takes place off our shores and on our Continental Shelf.
I was glad to see the Affirmative Resolution procedures covered in the Bill, because it is right that both Houses of Parliament should have the opportunity of considering the list of subjects which are to be exempted and deciding whether or not the categories are appropriate.
I would end by raising one other separate valuation subject. If the noble Lord, Lord Kirkhill, was here at Question Time today he will have heard me raising a matter which has been considered by the courts, which is the question of the assessment of wheelchair housing and other housing for the severely disabled, when houses have had to be adapted, in order that people can live in them who are in wheelchairs or are otherwise severely disabled. The position is that both in Scotland and in England cases came up earlier this year. The Appeal Court decided in favour of the disabled persons. But your Lordships' House, in its Judicial capacity, interpreted the law in the other sense, and in so doing, the noble and learned Lords concerned criticised the wording of the English Act—it was Section 45 of the General Rating Act—as being ambiguous and labyrinthine. Everyone has agreed, I think, that further legislation is needed.
My Lords, on 10th May in the other place, Mr. Barnett, the Minister concerned, said that the Government were examining the present legislation carefully in the light of the judgment which I have mentioned,
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and the criticism made of the ambiguity of Section 45. That, of course, applies to England and Wales. There has been a similar case in Scotland. I hope the Minister might be able to take the opportunity of this valuation Bill, a Scottish valuation Bill, going through Parliament to add a very short amending clause which would put right something that certainly needs to be put right in our valuation law in Scotland as regards the disabled; that is, not only making it clear so there is no difficulty of interpretation but also setting it quite definitely in favour of the severely disabled person.
My Lords, it is far cheaper for the Government and the taxpayer to encourage severely disabled people to live in their own homes than it is to keep them in hospitals or institutions. In hospitals, they are occupying valuable beds. Apart from that, of course, it is the best therapy and the best thing for the disabled themselves if they can be as independent as possible, living in the community rather than simply being in hospital or in an institution. So the change in the law, the amending legislation which would be short and non-controversial, far from adding to public expenditure would have the opposite effect. It would help to reduce public expenditure. I can give this assurance to the noble Lord; that is, if such a clause were added to this Bill, there would be no accusations from this side of the House of "tacking".
I understand that the later stages of this Bill will be taken in October, probably when we return, so there is plenty of time for the Government to continue their examination, which the noble Baroness who replied to me today said they had under review at the moment, of the legislation and the amending legislation that is needed. I hope that the Government will be able by October and the Committee stage of this Bill to produce an amending clause of the kind I have mentioned on this other subject. This is a miscellaneous Bill dealing with a great number of subjects, and I think it would be in place. If the noble Lord can use this Valuation and Rating Bill for that purpose, it will be greatly welcomed. I recognise the need for this, and we will otherwise do what we can to facilitate the passage of the Bill.
7.33 p.m.
Lord KIRKHILL: My Lords, I must confess at the outset that I was not present at Question Time earlier today, so that I was not privy to the discussions and deliberations which took place at that time. But I will certainly read Hansard tomorrow and make myself aware of the point which the noble Lord, Lord Campbell of Croy, raises with me. He might forgive me if I do not stray into the esoteric law of the line and area and extent of delineation of the Continental Shelf, a subject which I know is of particular interest to the noble Lord, and a subject on which I know he has considerable expertise and on which he has expressed, both in your Lordships' House and elsewhere, definite, clearly constructed and well thought out views. Rather, I would attempt to confine my remarks to replying to a number of specific points which the noble Lord, Lord Campbell of Croy, raises with me, as these relate to what, as he himself says, is a somewhat complicated Bill.
Of course, I welcome the very generous welcome of the Bill give by the noble Lord, and I confirm to your Lordships that certainly the Tay and Forth Road Bridges will be exempt, as will those oil installations, as I indicated in my earlier remarks. But the noble Lord has really asked of me how the expected course of events might move following enactment of the Bill. If I can be of some help to him in this regard, it might be appropriate for me to comment at this stage.
As I understand it, at this stage in our deliberations at least, the Secretary of State for Scotland will make an order under Clause 1 exempting from valuation and rating general descriptions of subjects. We have already mentioned the Tay and Forth Road Bridges and the oil installations which will dispose of existing valuation roll entries in respect of the two toll bridges and the oil installations. And thereafter no further subjects falling within the general descriptions, for example, any other offshore oil installations, may be entered in the valuation roll.
Clause 2(1) will prevent the assessor from making any valuation roll entry in respect of any subjects lying wholly or in part below low watermark until such time as he has notified to the Secretary of State for Scotland his intention to do so
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and has received intimation from the Secretary of State that the Secretary of State does not intend to make an order which would exempt the subject in question. There is an alternative possibility that an exempting order may be made. It is at this point that one immediately thinks of wave power, perhaps, or the new geological resources which are becoming more apparent, the whole new range of technology and, indeed, as the noble Lord, Lord Campbell of Croy, has mentioned, the construction platforms. It is at this point that we think of these things. As I understand the Bill, Clause 2(1) would give this cover to the Secretary of State to make his decision as the assessor intimates to him the assessor's intention.
Then, of course, there is the great bulk of coastal subjects which I mentioned earlier, which must remain liable, as they are at the moment. Clause 2(2) provides a means of dispensing with the assessor's duty to give notice before making a valuation roll entry. The subsection allows the Secretary of State to dispense with notices under subsection (1) in respect of such classes of subjects as he may direct. Thus—and here I touch on a point which the noble Lord, Lord Campbell of Croy, mentioned—for example, a direction could dispense with the need for notice of intention to assess any harbour, a pier or a jetty, or any bridge, or moorings, or a fish hatchery. The noble Lord also mentioned very explicitly the question of fish farming. I can advise the noble Lord that the Government have no present intention of exempting fish farms. Their rateability in Scotland recently has been confirmed by the courts, and any case for exemption would have to show why local taxation should not continue to be levied.
I am sensitive to the very interesting question which the noble Lord, Lord Campbell of Croy, posed to me on the question of house construction and renovation as they apply to the disabled. Of course, I am aware of the distinction between the English and Scottish positions. But I am bound to say to the noble Lord that it is probably outwith the scope of this Bill. However, I will at least undertake to read with great interest the remarks he made earlier this evening.
I was also asked by the noble Lord whether I could give some indication of

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definition of the seaward limits, as I understood him, of local authority jurisdiction. I have already indicated that I do not think I can comment adequately about the subtlety of the law as it applies to the Continental Shelf area. But as it applies seaward in terms of the limits of local authority jurisdiction I am advised there would be considerable advantages in a clear definition of boundaries, the very point the noble Lord has made, for all local government functions, and there are of course already very broad areas in other directions, as he knows. But it is very doubtful whether a single definition could be applied to all those functions. A great deal of consultation would be needed to clarify all the requirements, and I am advised it is not a task that could be undertaken quickly. As matters stand, it seems to me we have an immediate difficulty to which we must provide an immediate solution, and this Bill is an attempt in that direction.
Of course, I will return, with noble Lords, to discussing the matter at the next stage in October. Meantime, I would thank your Lordships for the welcome accorded to the Bill, and I will undertake to read very carefully all that has been said in a constructive way regarding the Government's latest measure before your Lordships this evening.
On Question, Bill read 2ª, and committed to a Committee of the Whole House.

RETIREMENT OF TEACHERS (SCOTLAND) BILL [H.L.]
7.41 p.m.
Lord KIRKHILL: My Lords, I beg to move that this Bill be now read a second time. The Bill which I seek to introduce to your Lordships' House today is commendably short, and my remarks will, I hope, be capable of a similar description. Before I describe the detailed provisions of the Bill, it may assist your Lordships' consideration if I set out some of the background to this measure. The employment prospects for newly-qualified teachers this summer have been raised on a number of occasions recently in another place, and your Lordships will have seen from Press reports that there is wide public concern about the matter. It is not possible to say precisely how many teachers may fail to
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obtain teaching posts next session, but there may well be as many as 2,000 or so out of the 5,500 who were expected to qualify this year. The Government hope that the number of unemployed will be less than that and that it will diminish as the school session proceeds.
My right honourable friend the Secretary of State for Scotland is doing all he can to reduce the problem. For example, at present the retirement ages of teachers in education authority and grant-aided schools are set out in Section 16 of the Education (Scotland) Act 1969. The ages are 65 for teachers in promoted posts, and 70 for the others, that is teachers in the basic grade. Under the Teachers Superannuation Scheme, however, teachers may retire at or after the age of 60 and draw their accrued pension rights. In practice, the majority of teachers retire before the age of 65, and I understand that in 1975, 90 per cent. of all the teachers who retired were aged 65 or under. At the beginning of the 1975–76 school session there were about 300 teachers aged 65 and over in full-time permanent posts in Scottish schools.
My Lords, the Government, by proposing to reduce the statutory retiring age for non-promoted teachers from 70 to 65, thus making a contribution to the reduction in unemployment in young teachers, are very far from taking the view that no teacher should be employed above the age of 65. The Bill before your Lordships' House provides that while the retiring age should be 65 the employing authority may, in certain circumstances, continue to employ a particular teacher. It is necessary to leave such possibilities open, to deal with, for example, circumstances where it is impossible otherwise to find a teacher able to teach a particular subject, or indeed to take account of personal circumstances which may justify some employment beyond the statutory retiring age. The essence of the change being made is that while at present an employer must employ a non-promoted teacher until 70 if the teacher wishes, the employer in future will be able to decide whether a teacher should be employed after 65.
I turn now to the clauses of the Bill, but I should make clear to your Lordships' House that none of its provisions will alter the present position whereby a teacher may choose to retire at any age after 60

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and draw the pension to which he or she is entitled. Clause 1 of the Bill removes Section 16 of the 1969 Act, which I have described earlier, and replaces it with a new section. The new section has the main effect of reducing the age of retirement for a non-promoted teacher from 70 to 65. The new retiring age will come into effect on 1st January 1977, and will apply to anyone reaching the age of 65 after that date. For teachers already aged 65 and over on 1st January 1977, that date will be their date of retirement. I will deal later with the reason for choosing 1st January. Subsection (2) introduces the element of flexibility to deal with the needs of individuals and of authorities which, as I said earlier, is, in the Government's view, so important. Paragraph (a) enables an education authority to reemploy a retired teacher, but in a basic grade post only and on a temporary basis.
There is the possibility that automatic retirement of promoted teachers on their 65th birthday could cause difficulty or disruption in a particular school. The retirement could, for example, fall halfway through a term, or in the middle of a period of preparing pupils for an examination. In many cases, of course, employing authorities and the individual concerned will have foreseen the problem and will have made arrangements to prevent difficulties or disruption. Nevertheless, in the Government's view it is important that there should be some flexibility allowed to employing authorities, and paragraph (b) therefore enables an education authority to re-employ a promoted teacher in the post from which he has retired for a period of up to 3 months from the date of retirement. This should enable the teacher to stay in that post for a sufficient time to permit a smooth handover of responsibilities. It is, of course, open to the education authority to re-employ that teacher for more than 3 months, but when the 3 months are up the re-employment must be in a basic grade post.
Subsection (3) defines a post of special responsibility. In effect it is a post above the basic grade. It may help your Lordships to put the matter in context if I say there are at present in Scottish schools and further education colleges some 60,000 teachers and of these about 35 per cent. occupy posts of special responsibility.
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Clause 2 contains the citation, commencement and extent. It is, in the Government's view, important that those affected, both individual teachers and education authorities, should have time to adjust to the new situation. The date of 1st January is, therefore, the earliest at which the new provision could reasonably come into force.
The reduction in retiring age of non-promoted teachers proposed in the Bill has been the subject of discussion with the education authorities and the three main teacher organisations. The basic principle is supported by the authorities and two of the teacher organisations, including the Educational Institute of Scotland, which is by far the largest union. One organisation however, the Scottish Secondary Teachers' Association, has criticised the proposal on the grounds that it is against the interests of teachers whose service in the profession is relatively short and those who have entered or returned to the profession in response to Government appeals.
I recognise that, as a result of the proposals in this Bill, some teachers may have their expectations about their period of employment reduced, but, as I have indicated, there is sufficient flexibility in the Bill to enable authorities to continue individual teachers in employment if they consider that the circumstances either of the school or of the individual make this desirable. Moreover, it cannot be said that 65 is an unusually low retiring age; it is in fact the statutory retiring age for all other fields of local government employment. In the Government's view this is an important measure, and I commend the Bill to your Lordships for Second Reading.
Moved, That the Bill be now read 2ª.—(Lord Kirkhill.)
7.49 p.m.
Lord CAMPBELL of CROY: My Lords, I would not ask the Minister to reply to any points on this Bill tonight, but I should like to make one or two comments. He has confirmed that the Bill has been brought in in order to provide more openings in the teaching profession for the young teachers who have just qualified. There is a shortage of teaching jobs in Scotland for those embarking on the profession. But why

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the Minister has felt it so urgent as to introduce the Bill so late in this Session is not absolutely clear, because I do not think that this Bill can be regarded as non-controversial in the way in which I think the last Bill we have considered will be.
The noble Lord said that there had been consultations, and we have seen from the Press that the SSTA (one of the teachers' associations) have registered their disapproval of the Bill; but I also noted in the Press, before the Bill was published, that the EIS, the largest teachers' association in Scotland, stated that they had reservations about the Bill. As the noble Lord mentioned, the objections appear to be related mainly to those who have come into the profession late in life, either through necessity or in response to an appeal from the Government, and those who might be affected by this would have small pension rights. They include teachers who, late in life, have been attracted by the special recruitment scheme to enter into the profession; women who responded to appeal from successive Secretaries of State—including, I suspect, myself—to return to the profession to assist pupils during the time of teacher shortage; and, thirdly, widows who were forced to re-enter the profession, sometimes late in life, to support themselves.
The noble Lord said that the Bill is flexible enough to deal with these cases, and clearly it lies with the local authority concerned to decide whether to re-employ teachers when they retire at 65 or not. Therefore, a great deal will depend upon the humanity of the local authority as well as the supply and demand for teachers in their area. We shall go into these matters more appropriately at later stages in the passage of the Bill.
I would not ask the Minister to try and reply to points now, but I wanted to register the fact that I do not think that this can be regarded as completely non-controversial. Although we shall ask for an explanation of these matters in this House, I feel sure that many points will be raised and there may indeed be some individual opposition to the Bill when it goes to another place.
7.52 p.m.
Lord KIRKHILL: My Lords, I must respond very briefly to the last remarks of
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the noble Lord, Lord Campbell of Croy. I cannot understand why he thinks that this Bill can in any way be considered to be controversial. I should explain to your Lordships' House that the reasoning behind the apparent Government urgency in introducing this measure is an attempt by Government to ameliorate the unemployment rate among young teachers on the Scottish scene. I have also to say that the Secretary of State for Scotland consulted very seriously with the Convention of Scottish Local Authorities in the presence of the teacher unions, and only—and I repeat "only"—the Scottish Secondary Teachers' Association have raised any objection. Indeed, the EIS gave their assent to the continuing discussions which took place at the COSLA meeting.
May I make one last point. In 1969 the promoted teacher could stay until he reached the age of 70. In that year a change was made, and thereafter he had to retire at 65. There is almost an analogous position developing in this new situation. Speaking personally, my view is that really 65 is an absolutely top age for anybody to be teaching the young in an age of ever-increasing excitement and awareness, with a new ethos developing almost by the year. I should have thought this is a sensible measure, which I certainly intend to continue to commend to your Lordships on future occasions.
On Question, Bill read 2ª, and committed to a Committee of the Whole House.

STATE SCHEME PREMIUMS (ACTUARIAL TABLES) REGULATIONS 1976
7.55 p.m.
Lord WELLS-PESTELL Lord WELLS-PESTELL rose to move, That the draft State Scheme Premiums (Actuarial Tables) Regulations 1976, laid before the House on 12th July, be approved. The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper. The regulations arise out of the Social Security Pensions Act 1975 which received Royal Assent almost a year ago. Your Lordships will recall that this Act establishes a new State pension scheme made up of

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two parts: a basic pension and an additional earnings-related pension. Members of good occupational pension schemes may be contracted-out of the additional pension and half the additional widow's pension, but the occupational pension scheme must provide at least an equivalent pension. This is known as the guaranteed minimum pension.
The Act provides for the guaranteed minimum pension of an employee who leaves contracted-out employment before his scheme's pension age to be preserved by the scheme and revalued in line with the movement in earnings generally, by 5 per cent. or 8½ per cent. per annum. If revaluation is at the 5 per cent. rate a limited revaluation premium has to be paid to the State scheme which will then provide any revaluation in excess of 5 per cent. If a pension scheme ceases to contract-out, responsibility for the guaranteed minimum pension may either be retained by the scheme or transferred to another contracted-out scheme if approval is given by the Occupational Pensions Board. Otherwise the guaranteed minimum pension or the accrued rights to guaranteed minimum pension must be transferred to the State scheme by payment of a pensioner's rights premium or an accrued rights premium. The regulations before us set out how limited revaluation premiums, pensioner's rights premiums, and accrued rights premiums are to be calculated.
During the passage of the Social Security Pensions Act through Parliament the great concern of the pensions interests was over what became known as the "open-ended commitment". They were concerned that if a scheme should have to cease contracting-out the full extent of the scheme's commitments should be known in advance. The Government made a number of important concessions to meet those fears and most of the concessions are embodied in these regulations. The Act requires that the regulations are to be made only after consultation with the Government Actuary. This has been done, and I am sure that your Lordships will agree that it is inconceivable that regulations as complex as these should be made without such expert guidance.
The very fact that we are here discussing the regulations results from the con
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cession made to make these regulations subject to the Affirmative Resolution procedure. The other concessions are that the actuarial tables must always be based upon the assumption of an average yield on investments not less than the assumed average increase in earnings; in other words, the assumption is that there will never be a negative yield situation. The premiums will vary to reflect current yields on investment. In this way the amount of premium payable is related to the money which a scheme would get by realising assets to pay the premiums. Finally, in calculating the amount of guaranteed minimum pension to which the premium relates, a revaluation rate of 12 per cent. may be taken in each of the last five years before contracting-out ceases instead of revaluation in line with the movement in earnings generally. Perhaps I should add that this applies to a firm which is going to withdraw from the contracting-out scheme.
These concessions were made by the Government in order to get a pensions scheme which had the general approval of the people of this country. There had been enough dispute about pensions and all concerned wanted a scheme which would get off the ground and which would last. The Pensions Act provides such a scheme and the Opposition, TUC, CBI and pensions interests have all played their part with the Government in getting a consensus on pensions based upon partnership between the State scheme and occupational pension schemes. I am sure that this same spirit will be seen in discussing these regulations.
There has indeed been very full consultation with the TUC, CBI and main pensions interests. In January a Consultative Document prepared by the Government Actuary was circulated. This explains the basis on which the actuarial tables would be set out. Draft regulations taking account of the comments made were circulated on 15th April. The regulations before us have, in turn, been prepared in the light of the helpful comments which the Government received. As a result of these consultations, the number of tables has been reduced from about 160 to 10 by having only one alternative table for each standard table and obtaining the other alternatives by a very simple formula—if anything in this is simple. This enables us to avoid

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having minimum and maximum market level indicators. Also, the market level indicator will be measured over the first five working days of the month in which contracting-out ceases so that the amount of premium will be known before a scheme ceases to be contracted-out.
The House will appreciate that these Regulations are very technical. They are; let me be frank. I have found, from bitter experience, that they are very difficult to understand. They set out the three elements needed for calculating a premium. First is the amount of guaranteed minimum pension to which a person is entitled at the time a premium has to be paid. This is converted to an annual figure called the "accrued rights factor". Secondly, there is the "market level indicator" which has to be calculated. This is the device for relating the premium to current yields on investments. The formula is set out in the regulations and is based upon figures compiled by the Financial Times (which I hope is an acceptable one) the Institute of Actuaries and the Faculty of Actuaries. Thirdly, there are the actuarial tables themselves which are set out in the schedules to the regulations. If the market level indicator is 100, a standard table is to be used. Otherwise, the alternative table is to be used. To calculate the premium, the amount is taken from the appropriate table according to the person's age and sex. The amount is multiplied by the market level indicator to give the premium for £100 of accrued rights factor and the result is then adjusted according to the actual amount of accrued rights factor involved.
A word about the timing of the regulations. The market level indicator is, in part, based upon the index number applicable to 20-year Government stocks. It is generally accepted that this index has shortcomings and I understand that a more suitable index is being prepared. The Government have decided to go ahead with these regulations now and to revise them when the new index is available so that employers and schemes know the kind of premiums they will have to pay. They need this information in order to decide whether or not to contract out and it would be wrong to delay the regulations for even a few months.
I therefore commend the regulations to your Lordships, having acknowledged
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373that they are complicated and very technical, but having pointed out that the CBI and the TUC, and various bodies including the Financial Times, the Institute of Actuaries and the Faculty of Actuaries have made a magnificent contribution to this Scheme. I therefore move that the regulations be approved.
Moved, That the draft State Scheme Premiums (Actuarial Tables) Regulations 1976, laid before the House on 12th July, be approved.—(Lord Wells-Pestell.)
8.6 p.m.
Lord LYELL: My Lords, the gratitude of the House is due to the noble Lord, Lord Wells-Pestell, for the very lucid and detailed manner in which he explained the provisions of these regulations and, indeed, for his own expert guidance through what I found to be a complete labyrinth of legal terms. As he explained, these regulations are very complicated indeed, but the tables in the schedules, I understand, have been requested by various pension funds and institutions so that their liabilities may be determined with a reasonable degree of certainty should various contributors to a contracted out pension scheme wish to rejoin the Government occupational pension scheme. I understand that the regulations before us meet the requests of all the pension funds and to that extent I believe that they would wish me to express thanks to the Minister and to the Government.
I do not think it is for me to attempt to discuss or comment on the many details of the regulations, nor on the tables nor schedules since we on these Benches are committed to a bipartisan policy on pensions, as outlined in the Social Security Pensions Act 1975, to which the noble Lord referred. However, two points give us slight concern. One deals with the representation of non-unionists on pension funds while the other is dealt with this evening; it is the improvement of the premiums payable to the Government scheme when a contributor rejoins it.
May I ask the Minister to confirm what we believe to be the case: that the upper and lower limits on the premium liability payable by pension funds when contributors leave to rejoin the State scheme have been removed? We understand that the noble Lord's honourable friend had written a letter in June of this year to

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one of my honourable friends in another place and we should be grateful if the noble Lord would confirm the contents of that letter. Perhaps the noble Lord would also say a few words on the standard and alternative tables in the schedules at the end of the regulations. I find them difficult to understand; at least, they appear to be relatively simple but I think there must be a nasty catch. Looking at them, it seems that the alternative tables are reminiscent of French currency regulations shortly after 1958, when, I understand, currency was in "heavy" and "light" francs. As I understand it, the alternative tables merely push the decimal point two or three places to the right or left, but doubtless the noble Lord will enlighten us later, if he is able to do so. We are grateful to the Government for producing these regulations because they will assist pension funds in determining their liabilities.
8.9 p.m.
Lord WELLS-PESTELL: My Lords, I am grateful to the noble Lord, Lord Lyell, for his comments and observations. I must say that I should have been in very serious difficulty had I not had the advice of my advisers and the help they have been able to give me because I must acknowledge that this is a very complex matter. The noble Lord referred to a letter which my right honourable friend the Minister for Social Security wrote to Mr. Kenneth Clarke. I believe that the noble Lord said that this was in June and, just for the Record, I should like to say that the letter was sent on 23rd July. It is perfectly true that we had asked for comments and observations from a very wide field. The main comments made on the draft regulations which were circulated were that there were far too many tables and that the regulations were far too complicated. It was also suggested that the alternative tables should be provided when the market level indicator was below 40 or above 139. We were able to concede the points made by Mr. Kenneth Clarke and they have been dealt with and were not pursued.
We have also met two other comments. The first was that the regulations should be delayed until a new fixed interest of security yields index is available—I dealt with that—and we were also asked about
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the period over which the market level indicator should be measured. That has also been dealt with and we have confirmed this, as the noble Lord pointed out, in a letter to Mr. Clarke.
The draft regulations circulated for comment provided that if the market level indicator dropped below 40 the appropriate tables should be used and that if the indicator went above 139 the tables appropriate to that level should be used. This was because we thought that indicators below 40 and above 139 were unlikely to arise and that it would avoid printing a lot of unnecessary tables over and above the 160 which were thought to be necessary. A number of pension interests were very concerned about this and felt strongly that the tables should be extended to cover the situation if the market level indicator fell below 40. This was because, when an extreme position has been reached, the protection afforded by the link with the market yield is most needed. We accepted the arguments put forward and have now made provision for the actual indicator to be used in all circumstances. The reduction in the number of tables and by using only one alternative table in each case makes this easier to operate.
The noble Lord asked me something about the five Schedules and I shall attempt to give him an answer. Schedules 1 and 2 are for use in calculating accrued rights premiums when a scheme ceases to be contracted out, the first where the guaranteed minimum pension is subject to revaluation in line with the general movement of earnings or where the pension is being preserved and revalued at the fixed 8½ per cent. rate, and the second where the guaranteed minimum pension is being preserved and revalued at the 5 per cent. rate, a limited revaluation premium having previously been paid. The State scheme thereafter accepts full responsibility for the pension rights.
Schedule 3 is for use in calculating limited revaluation premiums, mainly when a member leaves a contracted out scheme before having reached pension age and the scheme wishes to limit its own responsibility for revaluation of the guaranteed minimum pension to 5 per cent. Schedules 4 and 5 are for calculating the pensioners' rights premiums to be paid by schemes which cease to be contracted out and where the State scheme

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is to take over the continuing pensions payments. Schedule 4 is for members' own pensions, and Schedule 5 for widows' pensions of deceased members. In each case, the alternative tables are to be used instead of the standard tables whenever the market level indicator is not 100, which, as the noble Lord knows, will usually be the case.
On Question, Motion agreed to.

EUROPEAN COMMUNITIES (IRON AND STEEL EMPLOYEES RE-ADAPTATION BENEFITS SCHEME) (AMENDMENT) REGULATIONS 1976
8.15 p.m.
The PARLIAMENTARY UNDER-SECRETARY of STATE, DEPARTMENT of INDUSTRY (Lord Melchett)The PARLIAMENTARY UNDER-SECRETARY of STATE, DEPARTMENT of INDUSTRY (Lord Melchett) rose to move, That the draft European Communities (Iron and Steel Employees Re-adaptation Benefits Scheme) (Amendment) Regulations 1976, laid before the House on 15th July, be approved. The noble Lord said: My Lords, the steel industry is one of our most important heavy manufacturing industries. It is also a major employer, currently employing around a quarter of a million people in plants in every part of the country. In many towns the steel works is the major source of employment. This means that measures to improve the competitive strength of the industry can bear very heavily on the individual worker.
It was in recognition of the major part that the steel and coal industries must play in the future of Western economies that the ECSC was set up in 1951, to bring about such conditions in these industries as would ensure a rational distribution of production at the highest possible level of productivity. Since we joined the Community, both the NCB and the steel industry have been able to take advantage of ECSC aid in carrying forward their programme of rationalisation and modernisation which are cornerstones of the public ownership of these industries. The provisions of the Treaty of Paris setting up the ECSC are therefore at hand to assist our coal and steel industries with the modernisation and reconversion of the plant, and to cushion the blow of any necessary redundancy. Such provisions
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have already been used to great advantage by our coal and steel Community partners in equipping their industries to meet both domestic needs and exigencies of export trading.
Today, we are concerned with Article 56 of the Treaty of Paris, and particularly with the parts of that Article which allow for the provision of assistance to certain redundant steelworkers, the cost being supported jointly by the national Government and the funds of the ECSC. The forms of assistance which have for several years been available to redundant steelworkers include, first, tideover payments to bring earnings in new jobs up to a percentage of pre-redundancy earnings, and special unemployment benefits to men who are unable to find another job immediately; secondly, travelling and resettlement grants to encourage mobility both within the steel industry and away from it; and, thirdly and most importantly, payments during approved vocational retraining courses by which means the often highly skilled steelworker can aim to take his place at a similar level in another industry.
On these criteria, over 13,000 steelworkers from some 25 locations have become eligible for assistance. Not all have needed aid, but, to those who have drawn scheme benefits, we have paid some £4½ million in all over the last three years. The cost is borne jointly by the national Government and the ECSC, the latter using funds which have themselves been gathered in levies from the coal and steel industries of the member countries. It is generally agreed that such assistance has been very valuable, both to those steelworkers who have been made redundant and in helping to provide in-house training for redeployed workers.
We consulted both unions and management before the scheme was set up and, in its existing form, it takes account of the needs that could be forecast at the time. However, three years' experience of the scheme has thrown up several aspects which require some amendment, either to ensure that the scheme adheres more exactly both to current United Kingdom legislation and to the convention which authorises the European Commission to contribute towards the cost, or to improve certain aspects which have been found wanting. In the former category, there

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are some minor technical and consequential alterations. There are also some changes of some substance which the Government propose to make to the scheme and to which the European Commission have already agreed to contribute.
Foremost among these is the inclusion of an Article enabling the Secretary of State to adjust the weekly benefits to take account of changes in the cost of living. It is proposed to calculate this using as a basis changes in the Retail Price Index over the year after each individual comes to benefit, and again over two years if the person still qualifies for benefit. These increases will of course be contained within the present, and any future, pay policy agreements which may be instituted. This amendment brings the steel redundancy scheme in line with the redundant mine-workers schemes and it is expected to prove valuable in maintaining the present purchasing power of benefits.
The cost of living adjustment will not be applied to flat rate benefits, but it is proposed to increase present flat rate benefit of £5 to £9 to take account of changes since the scheme was introduced. This will particularly help, for the first year after redundancy, the younger unemployed who are, in the present economic climate, having considerable difficulties in finding jobs.
As I have already mentioned, one of the most important aspects of this scheme is the provision that it makes for the re-training of ex-steel workers. Two amendments are proposed here. The first widens the range of the training courses which steelworkers may attend under the scheme. In consequence people training, for example, as computer technologists, radiographers and for work with the mentally handicapped will now receive the benefits during the first year of the training course. The second amendment lists, with reference to the steelworkers' previous earnings in the steel industry, the actual amount the person can expect to receive while retraining, for a maximum time of one year with variations for the number of dependants. The table will give trainees very approximately an equivalent amount to their previous take-home pay as steel
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workers and will greatly simplify the previous complicated system of calculating training payments. The final amendment of substance is to include the self-employed in eligibility for benefit.
My Lords, these are in brief the major amendments which the Government are proposing to make to the existing Iron and Steel Employees Readaptation Benefits Scheme. The measures already available, with the substantial improvements provided by these amendments, will help to reduce the very grave social effects of the redundancies which are an unfortunate corollary of the modernisation of the steel industry in this country, so necessary for the future health of the United Kingdom engineering industry as a whole and for our position as a major manufacturing nation. I beg to move.
Moved, that the draft European Communities (Iron and Steel Employees Re-adaptation Benefits Scheme) (Amendment) Regulations 1976, laid before the House on 15th July, be approved.—(Lord Melchett.)
8.22 p.m.
Lord REDESDALE: My Lords, first I should like to thank the noble Lord, Lord Melchett, for giving such a clear exposition of this measure. I found it most helpful as no doubt the rest of your Lordships did, and obviously the noble Lord's long association with the steel industry helps him to assimilate this. This measure highlights one of the benefits of belonging to the ECSC under the Treaty of Paris in that it shows the amount of money that can soften the hardship incurred by closures which we were discussing in this Chamber the other day. I intended to ask the noble Lord one question, but he answered it half way through, although I did not quite catch the number of people who have benefited. I believe the figure given was 3,500, but I might have got a nought wrong on that.
However, I should like to ask the noble Lord the 64,000 dollar question; that is, how many people does he think will be benefitting over the next two years? That is obviously a hard question to answer. Another point which I should like him to confirm is whether Her

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Majesty's Government will be contributing on the same basis as the European Steel Community—on a 50–50 basis, on a basis which I believe is known as additionality.
Finally, there is one small point which I should be grateful if the noble Lord can clear up. It arises on page 9 of the Regulations. The final phrase in the Explanatory Note, under Regulation 14, states:
"…and render ineligible for benefit persons who are not ordinarily resident in the United Kingdom."
The question of residence seems to have different definitions with different bodies, from the Inland Revenue onwards, and I should be grateful if the noble Lord can clarify this. Otherwise we welcome the measure wholeheartedly.
8.25 p.m.
Lord MELCHETT: My Lords, I am very grateful to the noble Lord for his welcome to this scheme. As he said, I am sure that it is a very valuable contribution to the enormous hardship undoubtedly caused by major closures of steelworks in areas of the country where very often the steelworks provides the only source of jobs in a particular town because of historical reasons. In my opening remarks I said that 13,000 steelworkers had become eligible for assistance so far. Not all of those have needed to take up the aid, but we have paid out £4½ million in all over the past three years. With regard to the cost, my understanding is that this is borne 50–50 by the national Government and the ECSC, and I think that that will continue to be the case in the future.
As to the detailed definition of "residence", it would probably be most helpful both to myself and to the noble Lord if I wrote to him about that. I do not know what particular technical definition of "residence" is being used and I think that is the question which the noble Lord asked me. It is quite clear that the scheme should not provide benefits to people who are not normally resident in the country and I do not think there is any difference between us on that point, but if I may, I will write to him on it.
On Question, Motion agreed to.

INDUSTRIAL COMMON OWNERSHIP BILL
8.26 p.m.
Lord LEE of NEWTON: My Lords, I beg to move that this Bill be now read a second time. In a period of great monopolies, both private and public, and indeed at a time when we see the great international companies, with their huge economic power, coming more and more into our daily lives, it is a pleasure to me to be able to invite the House to review the activities of the small common ownership enterprises, numbers of which are now making a small mark in British industry. When my honourable friend Mr. David Watkins, the Member for Consett, introduced his Industrial Common Ownership Bill in another place he went to some pains to explain that a common ownership enterprise is a self-governing association productively engaged, and in which the association exists to enhance the quality of life of its working members and to serve the wider community. After payment of taxation and making provision for reinvestment, the remaining profits are used to provide a bonus for the working members or indeed for such purposes as they themselves desire.
The number of these firms has grown fairly rapidly in recent years. Some of them have been started as common owner ship enterprises while others have been converted from conventional small companies to common ownership companies. The Industrial Common Ownership Movement itself stemmed from the example set by a few owners of businesses who acted on their belief that control and ownership should be exercised by the people who work in this type of enterprise. We then had those who converted existing undertakings, or started new worker-owned ones, and this led to the name Common Ownership being adopted in, I think, 1971.
The pattern of these enterprises is extremely interesting. They vary enormously from those containing three or four members to the comparatively large Scott Bader Commonwealth Limited, which I understand now has 430 workers. I submit to your Lordships that of its very nature the common ownership idea contributes to a very high state of industrial democracy, and indeed to very

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good industrial relationships. When we consider these matters in their wider context, perhaps we could look at the examples we get in these small common ownership enterprises.
Noble Lords may be aware that there have been considerable changes in this Bill since it was first introduced. The original Bill, as introduced by Mr. Watkins, had among its aims that of providing financial help and encouraging enterprises to convert themselves to common ownership by simplifying the process for companies limited by shares, and by eliminating tax deterrents for shareholders by allowing reliefs in the event of their being converted. As I understand the position, the original aims of the sponsors were modified because of the understandable reluctance of the Government to change the existing principles in the Companies Acts affecting creditors' interests. The changes suggested were accepted by the sponsors. I believe that the changes made between the two Bills are only marginally significant in view of the existing facilities which come under the Friendly and Industrial and Provident Societies Act. For my part, I welcome very much the provisions which appear in the Finance Bill itself. These will give relief from capital transfer and capital gains tax in the event of a transfer of ownership to an employee trust.
I believe that the Bill, if it becomes an Act, will serve to stimulate the growth of such enterprises, and indeed will help in the establishment of an advisory service about the organisation of worker-controlled enterprises. I was at this stage going to go into a lot of detail about the clauses themselves. In view of the lateness of the hour I will refrain from doing that, especially as I do not doubt that noble Lords can read the Explanatory and Financial Memorandum as well as I can; so if we can take that part as read it may save all of us our patience and perhaps we can get to bed a little earlier.
I noticed in my review of the Committee stage in another place that one Government Amendment which attracted discussion was the one for statutory trade union representation on the body as a condition for receiving Government funds. Indeed, it was argued in Committee that
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this was unnecessary and would give the trade unions a privileged position. I have been in the trade union movement a long time, and I have never yet managed to find a privileged position. But the view of the Government, with which certainly the sponsors are in complete agreement, is that trade union representation is necessary in order to ensure that proper consultation takes place with the trade unions representing the workers in or affected by an enterprise seeking financial help from the body; and when one considers it, and considers perhaps the immature state of many of these companies when they make that application, I suggest to the House that it is not a bad thing to have on the body which will determine loans, and so on, representation of the appropriate trade unions whose members are expressing themselves by trying to form this kind of company. I hope that on balance the idea will commend itself to noble Lords.
Despite this, as I went through the Committee stage proceedings I felt that the contents of the Bill, the guts of the Bill, were really quite non-contentious. I felt, and still feel, that in all parts of the House, certainly in all parts of that Committee, they were very welcome. I believe from my readings of these industrial matters that certainly the three Parties represented here tonight have welcomed the development of this kind of enterprise. It seems to me, as I began by saying, that in this day and age, when we see the rather soulless kind of developments in our industry which are quite inevitable with the rise of huge combines, it is all to the good that men of ability lacking capital, as many of them do, can be provided with the facility to utilise their brains and their abilities in this way. It is also the case, of course, that in a great many areas these small associations, first, have been responsible for maintaining jobs when a company would otherwise have gone out of existence and, secondly, in a number of instances, have indeed succeeded in increasing quite substantially the number of people employed in the company as against the number previously employed.
My Lords, I have made reference to the time, and I will not trespass any further on your Lordships' patience. I hope that the House will agree that this is a very useful small measure which is very well

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worth our support and encouragement. I beg to move that it be now read a second time.
Moved, That the Bill be now read 2ª.—(Lord Lee of Newton.)
8.37 p.m.
Lord REDESDALE: My Lords, I should like to start off by congratulating the noble Lord, Lord Lee of Newton, on introducing this Bill so ably, and also state that we welcome the Bill although, rather naturally, we have a number of reservations, which I shall go into in some detail later. In another place the Second Reading debate took four hours; and with not such a large House, and in an area where so much emphasis has been laid on the fact that small is beautiful, I think that perhaps tonight the emphasis should be on "brief is beautiful".
I started off by saying that we welcome this Bill. The reasons why, in general, we welcome it are that there have been a number of successful practices, as was detailed in another place—in fact they were detailed at great length; every single example seems to have been discussed during the Second Reading debate—and on the Continent there have been even more successes. Most of these organisations started out in adversity, as has been said, but they fought their way through. Not all of them have come right through; some of them have considerable troubles to this day, and doubtless more that are set up will go through this same phase. But there is one matter that I feel we ought to look at, and that is that few of them have actually started from enthusiasm. They have been born out of necessity. I hope that this Bill will perhaps start more such enterprises on the basis of enthusiasm. They help the workforce to have a greater understanding of business principles and of what commerce is all about. As soon as one of these organisations is set up, the people concerned have an intimate knowledge of cash flows, like the rest of us.
In another place the debate ranged over the merits and demerits of the capitalist system. I think this is an excellent scheme when it works within the capitalist system. It also helps to break down the "them" and "us" situation which does exist, and has existed for a number of years, between
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workers and management, because when these operations are running they are all "us". But there are a number of points on that to which I shall return later.
Having dealt with the good news, I feel that one should also talk about the bad news. My reservations are these. These enterprises should not be used as an excuse for perhaps an over-idealistic Minister to waste public money on impractical ideological exercises; nor should they result in unfair competition with normal commercial concerns which do not have similar access to public funds for subsidies. I should like, if I may, to cover that point later.
The Industrial Common Ownership Bill itself still needs a great deal of scrutiny for two main reasons. These are that, first, it had only one effective stage in the Commons which was its Committee stage. Being denied a further Report stage because of a procedural device being used on the preceding Bill, in fact it had only a formal Third Reading. The second is that it was in any case substantially rewritten by the Government in Committee. Six clauses were deleted altogether and one, Clause I, was rewritten. At the Second Reading great play was made of the fact that Clause 1 is often the heart of the Bill. The Government carried out some major open-heart surgery on this Bill by totally rewriting it. I am not saying this is a bad thing. I think it is probably an excellent thing, but it was totally rewritten and, because of the Third Reading, we must look at it carefully when it comes to the Committee stage. We will move a number of constructive Amendments. These will he designed primarily to tighten up Parliamentary control, to lay down proper commercial criteria, to alter the Bill's provisions for assets on dissolution and to allow an enterprise maximum freedom and flexibility, particularly regarding voting rights. I should like to come to these points separately.
On Clause 1, I spoke about normal commercial terms and the criteria laid down. It would be quite wrong if these organisations were given unfair advantage over normal commercial operations. They will both probably be mainly small and therefore an advantage by a grant will be that much greater an advantage over the small commercial organisation.

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I wanted also to talk about the tightening up and, in Clause I as it stands in the Bill at the moment, the "relevant body" as it is referred to. If a grant to the body is made for its own expenses it does not appear to have to come before Parliament to justify this. This is an area in which something should be done at a later stage. Again, I do not think we should talk about grants and loans; we should talk about loans as in most organisations. Especially in view of the current expenditure cuts, I think this should be taken very seriously. There is another point in subsection (1) which states:
"grants made in pursuance of this subsection in any year shall not exceed £30,000."
Well, £30,000—if that is being put up—as these organisations will mainly operate with closed shops, perhaps the unions ought to match in areas this sort of money; because we are talking about two aspects, the advice section and the grant section.
Lord MELCHETT: My Lords, I am grateful to the noble Lord for giving way. I am listening very carefully. I do not follow from where he gets the idea that the enterprises will necessarily be closed shops. I would welcome the fact that they were, but I believe there is nothing in the Bill about that.
Lord REDESDALE: My Lords, I rather understood this from wading through the stages in the other place. That was the impression I gained. I am not saying it is in the Bill, but I understood that this was what the practice would be. It leads me on to another point further on where subsection (5) states:
"to include among its members one or more representatives of trade unions."
Presumably that would be the representatives, if they were closed shops—not necessarily, I am the first to agree; but this is the impression I gained. Perhaps I am wrong. It would be interesting to know what the noble Lord has to say on this subject.
To revert to Clause 1, I talked about normal commercial terms and I was a little alarmed by the phrase in subsection (1) where it refers to the Secretary of State and what he may give:
"on such terms as he thinks fit".
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This area is, I think, a little loose and could do with tightening up. When we come to the point about "relevant body" I am somewhat concerned that "body" is so loosely defined. I think it could at a later stage be defined more closely exactly what it is going to be. I appreciate that flexibility was probably shown as an advantage, but I think that this is too much flexibility.
I mentioned the point about trade unions being on the body. Frankly, I do not think it is necessary to lay down that they have to be there. I think that for the body to be functioning properly, it does not have to have by right members of trade unions on it; especially as one or two points came up in the other place where the trade unions, on occasions, may not be too much in favour of one of these organisations. This was stated on Second Reading as the noble Lord is, no doubt, aware. Therefore there are two sides to this case.
There is another aspect which worried me in Clause 2(1)(b): the point about deciding what the qualifications are. It states:
"other factors of any description".
This is another aspect to which I think a certain amount of consideration should be given later. Basically, as I said, brief is beautiful—and I will not go on too much longer. We will wish to bring in a number of these items.
I should be grateful for a little clarification on a few simple points. I could not see why in one part we talk about common ownership and in another part co-operative ownership. I do not see why we could not use the same phrase throughout. It would be consistent. The other point is about the role of the Registrar, where the Secretary of State does one thing and the Registrar another. I should have thought that the Registrar could act in both cases. There is also the question of limited guarantee. This is an area also at which we ought to look closely. I think there could be different meanings of "limited guarantee"—who is guaranteeing, and so on. Why has reference to the commencement been removed from the last clause of the Bill? It was in it in the original state. Perhaps this was an oversight. I do not know.

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There may be a good reason for it. I should be grateful if the noble Lord could tell us why.
We all from time to time must suffer from extraordinary Parliamentary ease, if that is an acceptable word. When we come to page 3, line 40, it has a distinctly Harry Lauder flavour when a body meets a body. The phrase there reads:
"for the purposes of this section a body is a subsidiary of another body if it is a subsidiary of the other body for the purposes of the Companies Act".
I do not think this quite comes up to the Guinness Book of Records and the ground nuts scheme which I think is immortalised there. Finally, on a more serious note, I query whether this is just a preliminary measure opening the door for a further major piece of legislation.
8.50 p.m.
Lord ROCHESTER: My Lords, we on these Benches should also like to thank the noble Lord, Lord Lee of Newton, for the clear way in which he introduced this Bill. Like the noble Lord, Lord Redesdale, we are in broad support of the principle underlying it. I must confess that until last weekend I knew very little indeed about the Bill. I am glad however to have done my homework because in reading the Official Reports of the Second Reading and the Committee stage of the Bill in another place, I learned a great deal about the basic concept of common ownership and to admire what was done by those who initiated the first enterprises in this field, and also about the devotion of the present members of the industrial common ownership movement to that cause.
A Member in another place had said that in his view it was not only imperative for the Government to support the Bill—that, incidentally, was when the Bill was in its original form—but if the Government did not go further, by introducing legislation in the next Session of Parliament which would establish a co-operative development agency, he and a number of his friends would seek to take all possible action to bring pressure to bear where it would hurt most. I wondered whether that threat related to the body politic or physical. Indeed, I felt some relief that I was not more closely associated with the co-operative development. if that is how it operates in practice.
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I should like to hasten to assure the noble Lord who is to speak for the Government that my noble friend—only one is present at this moment—and I have no action of this kind in mind. I was glad to note that members of the co-ownership movement in another place were most appreciative of the interest which had been displayed by the noble Lord in their movement. It may be therefore that in this respect at least the distinction between the co-operative development and common ownership will now be a little clearer to the noble Lord, Lord Redesdale.
I have already said that we on these Benches support the principle of common ownership, although we do not see it having much application—and neither does the noble Lord, Lord Lee, as I understood it—to large scale manufacturing industry. Relating the matter, as he did, to the question of industrial democracy and employee participation, now under such close examination by the committee chaired by the noble Lord, Lord Bullock, my feeling is that, subject only to enough money being available for this purpose, nothing but good can come from experimenting in the initiation of common ownership enterprises and the voluntary transfer of existing enterprises to common ownership as envisaged in the Bill.
Having said that, one is bound to question whether, given all the controversial legislation which your Lordships will shortly be having to consider, and the pressing need, as my noble friend Lady Seear was emphasising in the debate on the Finance Bill this afternoon, for the nation to achieve the best possible return on the capital it invests, this is the most opportune moment for the Government to require that valuable Parliamentary time should be spent on a Private Member's Bill of this kind. I believe that technically it still is a Private Member's Bill; but effectively the Government have taken over the Bill and have substantially redrafted the main clauses, as the noble Lord, Lord Redesdale, pointed out, and the noble Lord, Lord Lee of Newton, acknowledged.
This leads me to say that we on these Benches would think more highly of the Government if—I say this without dis-respect—they would state clearly what are

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their overall objectives and where their priorities lie in making money available to industry, whether under the Industry Act 1972, through the National Enterprise Board, or by means of Bills such as this one, rather than, as it appears to those not in the "know", that they should suddenly, as it were, take it into their head to dole out a few hundred million pounds to some car manufacturing company or make available small amounts, as in this Bill, in supporting causes that are no doubt worthy, such as common ownership.
Why is it apparently considered better to spend a few hundred thousand pounds on helping small common ownership enterprises in preference to other small companies which are based on some equally respectable form of ownership? That was a point on which the noble Lord, Lord Redesdale, touched. There are a few other questions that I have about the Bill on which I should welcome replies either from the noble Lord, Lord Melchett, or the noble Lord, Lord Lee of Newton, if only because, depending on their answers, my noble friends and I may wish to initiate or support certain Amendments at Committee stage. I will put these in interrogative form. To some extent the ground has been covered by the noble Lord, Lord Redesdale.
What are the precise criteria which will determine the amounts of grant and loan to be made by the Secretary of State to relevant bodies for the purposes set out in Clause 1 of the Bill? In particular, on what basis will the amount of £250,000, referred to in Clause 1(2), be made available, sometimes as a grant and sometimes as a loan? Why should not the money invariably be lent? Secondly, do the Government have in mind encouraging an experiment in common ownership in a field over which they already exercise a considerable degree of control and, if they have their way will soon exercise more, namely nationalised industry? For instance, will they soon be suggesting that some shipbuilding or shiprepair yard should be handed over to those employed in it?
Finally, I come to the point which has already been mentioned by the noble Lord, Lord Redesdale, though I should like to elaborate on it a little. This is a question which certainly troubles us a
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good deal. We should like to know why under Clause 1(5) the "relevant body" must always have on it not a few members of trade unions, but "one or more representatives of trade unions". One must ask: why representatives only of trade unions? Why not of employers or of consumers? Why is there this exclusive statutory requirement in the case of only trade unions? Who will appoint these representatives and under what precise procedure? What will be the ratio of trade union representatives to others on the relevant body? Why should not the body be self-constituted, with or without trade union representatives, as it sees fit?
I feel keenly on this question because, as the noble Lord, Lord Melchett, may recall from exchanges in our discussions on the Industry Bill a year ago, I sincerely wish to encourage as many people as possible to join trade unions, provided that they do not have to do so if they have conscientious objections against them. As I understand it, this requirement that the relevant body should include among its members one or more representatives of trade unions was not in the Bill when it was first moved in another place.
In the past, as the noble Lord, Lord Redesdale, has said, trade unions do not appear to have been notably enthusiastic supporters of common ownership, and the naughty thought has entered my head that support of the trade unions has now been obtained for this Bill by the expedient of tacking—and I am sorry, particularly after today's debate, to employ that word—these words onto the end of Clause 1. I hope that the noble Lord, Lord Melchett, will be able convincingly to dispel this suspicion, and indeed that the noble Lord, Lord Lee, will, on reflection, agree to amend the Bill by excluding these offending words.
What this country needs above everything else at the present time, if we are to overcome our economic and industrial problems, are policies to be followed by the Government of the day which command the broad support of the other Parties, and here is a glorious opportunity to make a move in that direction. I assure noble Lords opposite that it really does not help people like me, who are supporters of trade unions, to defend our position among our colleagues if this kind of thing is done. Therefore,

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I appeal to the Government and to the noble Lord, Lord Lee, at least to give very earnest further consideration to the point before the Committee stage. I hope that they will do that. May I, in conclusion, simply repeat that we on these Benches support the principle underlying this Bill, although we have doubts about it which we hope will be dispelled either now or in Committee.
Lord INGLEWOOD: My Lords, I do not rise to make anything as long as a speech, but simply to ask the sponsor of the Bill, the noble Lord, Lord Lee of Newton, when he comes to reply, to let us know a little more what is in his mind about what is called the "relevant body". Does he have in mind new organisations, or organisations which exist today? If he has in mind any new body which is not described in the Bill, may I ask him why, considering that most of these industrial common ownership ventures will be small, with many in rural areas? What is wrong with the Development Commissions, with their experience and organisation for channelling help to different kinds of small industrial enterprises, taking over this work? It is generally a mistake to set up new organisations when we have organisations in the country which can broadly do the job. So I think that the noble Lord might tell us a little more about what is in his mind, because that is a very important part of the Bill and at the moment it is entirely obscure.
9.5 p.m.
Lord MELCHETT: My Lords, like the noble Lord, Lord Redesdale, and the noble Lord, Lord Rochester, I should like to give this Bill a warm welcome on behalf of the Government. As has been made clear in another place, the Government warmly welcome the provisions of this Private Member's Bill. However, it is in no way a preliminary measure, as the noble Lord, Lord Redesdale, implied it might be, for some other Government legislation. It is a Private Member's Bill, introduced without any prompting at all on the part of the Government. It has nothing to do with our own legislative programme, but we, when the Bill was presented to the House of Commons, were quite happy to give it our full-hearted support. There are, of course, commitments in this Govern
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ment's Election Manifesto, as noble Lords, will know, about the Co-operative Development Agency, which was referred to in the debate in another place. While in some sense, this Bill covers the same ground as the Co-operative Development Agency, it is in no way a substitute for the Development Agency which will, after all, be considered in large part with the retail co-operative movement which this Bill, based on industrial co-operatives, does not touch on at all. So I really do not think that the CDA is particularly relevant to discussions on this Bill.
I have some sympathy with the noble Lord, Lord Rochester, and the noble Lord, Lord Redesdale, who have obviously read the Report of the Second Reading debate in another place, some of which I listened to. The proceedings in another place are a mystery to those of us who have not been there, but I have a feeling that the length of time taken over this Private Member's Bill may have had something to do with one of the measures which was immediately to follow it, rather than the merits or demerits of the Bill itself, and that may be one of the reasons why the debate at that time ranged very widely indeed.
The noble Lord, Lord Rochester, made one remark which I should like to correct about the Government requiring your Lordships and another place to spend legislative time on this measure. Of course, this measure and the legislative time that is spent on it has nothing to do with us. This is a Private Member's Bill and, whatever the Government's legislative programme, I am sure noble Lords on all sides of the House will welcome the fact that it is still possible for Private Member's legislation to be taken through to the Statute Book. The Government can occupy a great deal of time or very little, but Private Member's rights to get Bills into law are very important and are preserved, whatever happens. So I do not think the noble Lord, Lord Rochester, would suggest that the fact that we have a heavy legislative programme before us in the autumn is a reason why Private Member's legislation should not continue to be discussed by this House or by another place. This is a Private Member's Bill. I will in a moment say something about the redrafting which took place in Committee.

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I was glad that the noble Lord, Lord Redesdale, made the point that on the Continent a great deal more has been done than in this country. I am sure that is the case. We have a great deal to learn from our European partners, in particular France, so far as the development of cooperatives, particularly producer cooperatives, are concerned. While I agree with him that not many of the existing enterprises have been started through enthusiasm as opposed to the owner of the business deciding to change the structure himself or herself voluntarily, this is not entirely true. There are a number of common ownership enterprises, some of which I have had the privilege to visit, which have been started as a result of people's idealism and enthusiasm. Sunderlandia, a building firm in Sunderland, springs to mind where somebody set up the enterprise to give work to people in the building industry and in particular to provide training for apprentices. There are others. A number of producer cooperatives which were started around the turn of the century were set up when the retail co-operative movement was in its early days. Many of those enterprises still continue very successfully, particularly in some of the traditional industries like textiles, printing and footwear. However, I agree with the noble Lord, and certainly it is my hope that the passage of the Bill to the Statute Book will enable people with enthusiasm to start up new enterprises from scratch and provide much needed jobs in many areas.
Jobs are needed not only in rural areas—that may be the answer to the point made by the noble Lord, Lord Inglewood, about the Development Commission—but also in many areas of the country and it might be right to have a national body to disburse funds. However, perhaps I may come back to that point in a moment. The noble Lord, Lord Redesdale, suggested that this might be a waste of public money at a time when expenditure is under restraint. I can assure the noble Lord that the funds which the Government wish to make available under the Bill will come out of the existing budget of the Department of Industry. The sums are small compared with the total sums of money that the Department of Industry spends on private enterprise and nationalised industries, but it is no
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easy matter to get small sums of money out of any Department.
Lord REDESDALE: My Lords, I am grateful to the noble Lord for giving way. I made the point about grants, and if they are loans it does not matter so much.
Lord MELCHETT: Yes, my Lords, I was going to turn to that point in a moment. However, I should like to make the point that the Government give a massive amount of assistance to private industry in this country. Particular cases, such as Chrysler and the large investment programmes of the nationalised industries which we have discussed recently in your Lordships' House, sometimes mask the vast sums of money that are made available to private industry in the form of regional incentives, in particular the regional employment premium and the other standard regional incentives, and also in the form of tax concessions of one kind and another. The major tax concession recently has been stock appreciation relief.
One reason why we were happy to provide a very small amount of money compared with our total expenditure on private industry—a tiny amount of money, if one is being frank about it—to co-operatives is that they have considerable difficulty in making use of existing sources of finance for two reasons: first, because, as small enterprises on the whole, they are not eligible for much of the money which goes to private industry and they will not even be eligible in the future, because one of the characteristics of many co-operatives and common ownership enterprises is that they tend to remain at a certain size. This is very true of the enterprises which were started at the turn of the century—the producer co-operatives.
I went round one shoe manufacturers' which has been employing 70 people for the last 70 years, very successfully making a profit and providing very good shoes for many people to wear. There is no criticism that they have stayed at the same size, but at least a private company which is growing, looking to capital expansion and an eventual quotation on the Stock Exchange, sees itself as one day being eligible for a great deal of Government assistance for which small companies are not even eligible. And even in

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the case of those forms of assistance for which they are eligible, very often it is not practicable for a small enterprise to take up the assistance because of the amount of information that the Government must have at their disposal before they give away any public money even as a loan. Therefore, there cannot be any criticism that we are favouring one section of the economy in particular as opposed to another. The fact is that private industry gets a great deal of money; co-operatives on the whole do not receive any money from public funds except for one or two examples of larger enterprises recently: Meriden and Kirkby. However, on the whole the common ownership enterprises we are talking about have not received any public money to speak of.
The noble Lord also raised the question of grants and loans. The grants from the Government will be used only to pay the administrative expenses of the advisers who will be employed to give advice on setting up these enterprises: to provide people with advice on running them efficiently. That is the only form in which the grants from the Government will go direct to the advisers. Afterwards the Secretary of State has power to make grants or loans to the body who are then empowered only to on-lend to particular enterprises. Therefore enterprises receiving public money will get it only in the form of loans. The terms and conditions of those loans, as the noble Lord pointed out, quite usually are subject to the conditions laid down by the Secretary of State. Those will have to be brought before Parliament in a regulation, when both Houses will have a chance to discuss them—or at least another place will have a chance to discuss them, because I think financial matters would not come before your Lordships' House.
This is a perfectly normal arrangement which is provided for in many other Bills. There is nothing unusual in it. As I have said, the enterprises receiving money will only get the money in the form of loans. Of course public money is made available to industry on very favourable terms and often with interest-free periods of up to 18 months or more; so loans can be given on quite favourable terms, and already in many cases are so given to private industry.
Noble Lords have raised the question that this Bill was rewritten by the Govern
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ment in another place. I think that is a rather uncharitable suggestion. Only two major changes were made to the Bill between the Second Reading and the end of the Committee stage. One was that the provision for tax relief was dropped because the provisions of the Finance Bill achieved the same end. The other was to meet a point made by the noble Lord's colleagues on the Opposition Front Bench in another place who were concerned—as were the Government—with the conversion provisions for the extinguishment of shares in the enterprise.
Quite rightly, the Opposition in another place expressed concern about creditors' rights and liabilities and that, I am glad to say, with the sponsors' agreement was dropped from the Bill. Otherwise I think noble Lords will find that although the Bill was redrafted—which is quite usual with a Private Member's Bill—by Parliamentary Counsel who is responsible for the repetition of the word "body", no other major changes have been made.
Noble Lords may feel that the inclusion of the trade union representative on the body is a major change, but I honestly do not think it is, because it is quite obvious to anyone that there would have been some representative of the trade unions on the body whether or not the Bill laid down the fact that there should be. So I hope we can get away from the idea that this is either a Government Bill or something that the Government have dramatically altered between one stage and another in another place.
There is, of course, nothing in the Bill about the enterprises having had a closed shop. I understand that most common ownership enterprises do not have a closed shop, although some do. I welcome the fact of those who do, and I hope that more will in the future, but there is nothing in the Bill as to whether there has to be a closed shop or not and whether that makes it more or less eligible for the public money available.
The body which will he disbursing the funds has, quite deliberately, been left loosely defined in the Bill. I am myself extremely anxious that we should not find ourselves in the position of having to set up some new body. Here I agree with the noble Lord, Lord Inglewood, that we have enough bodies doing enough things already. In particular, there is

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already the Industrial Common Ownership Fund disbursing money to common ownership enterprises, and I think it is the Government's wish—which is shared by the sponsors of the Bill—that we should build on that Fund and the trustees of that Fund in disbursing the extra money that will become available under the Bill. The terms have been left loose because it is up to the Industrial Common Ownership Movement and others involved in producer co-operatives to present the Secretary of State with their own body of people. The Government do not want to lay down the people who should be on it. I should have thought that would be welcomed by noble Lords on all sides of the House as well. We do not envisage setting up a completely new body but making use of the existing resources of the Industrial Common Ownership Movement and others involved in producer co-operatives.
I should like briefly to say something about the distinction between common ownership enterprises and co-operatives, which the noble Lord asked me about. The point is that the Bill, sponsored as it is by the Industrial Common Ownership Movement, defines common ownerships in a particular way in Clause 2. It was the wish of everyone involved that the public money should go not only to people who were actually in common ownership enterprises but also to other producer co-operative industrial properties registered under the Industrial Provident Societies Acts. As I have said, some of those have been in existence since before the beginning of the century, and we saw no reason to exclude them from eligibility under the Bill.
So, in a way, Clause 2 contains a two-limb definition: first, of common ownerships and, secondly, that of other co-operative enterprises. Although the definition may seem a little vague, as there are in effect only about 20 common ownership enterprises and 20 other producer co-operatives, I do not think that a little vagueness does any harm. It would be a great pity to exclude one or two of the small number of enterprises currently existing because of some technical definition contained in the Bill. I think from what is in the Bill it is quite clear just what is meant, and that is after all the important thing.
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The noble Lord asked me a question about companies limited by guarantee. This is a normal form of existence. I understand that all golf clubs—although I am not a member of one—are companies limited by guarantee and it is something that appears in the Companies Act. I am surprised that the noble Lord, whom I suspect of being a golfer at least, has not come across this before.
My Lords, I think I have spoken long enough, particularly as I have to answer the Unstarred Question to come. I have been asked other questions, and, if there is anything I have not dealt with clearly, I should like to write to the noble Lords, Lord Rochester and Lord Redesdale, before we come to Committee stage. In conclusion, may I briefly pay tribute to David Watkins, the Member who introduced the Bill in another place, and, indeed, to all those outside the Houses of Parliament who have played a considerable role in promoting Private Members' Bills of this sort. They do an enormous amount of work, all unpaid, and largely unacknowledged by those of us who legislate. A great deal has been done on the Bill and credit should go to those who have done the work.
I have had the pleasure of visiting several producer co-operatives and common ownership enterprises, and it was a fascinating experience. Possibly on further stages of the Bill I will have a chance of telling your Lordships something about that. But there is no doubt about the dedication and often farsightedness of those involved in these enterprises, and those who have seen fit to convert their own private company into a firm controlled by everyone working in it. Personally, I feel that one day in the future, not too far ahead I hope, people will look back on the firms and the organisation of companies, both large and small, in our society now, in much the same way as we look back on the terms and conditions of employment in Victorian times, with children down the mines, which seems so odd to us nowadays, whereas it did not then. I daresay one day in the future people will look back and see as a very odd thing indeed companies with the people working in them having no say at all. The Bill seeks to work by common consent, and I hope your Lordships will give it a speedy passage.
9.22 p.m.
Lord LEE of NEWTON: My Lords, may I thank both noble Lords opposite for the constructive way in which they have dealt with the measure. There has been some slight controversy as to the part played by the original sponsors as distinct from the Government. As my sponsorship is of comparatively recent origin, and I was neither an original sponsor nor a member of the Government which suggested changes, I can pronounce with complete impartiality and neutrality that the Government were right to move the Amendment, and the sponsors were a thousand times right to accept it.
My Lords, there was also a little suspicion as to whether or not this is to blossom into something enormous. Indeed, I think the noble Lord, Lord Rochester, went so far as to wonder whether we were going to be handing over the shipbuilding industry to its employees. Quite frankly, I do not know any body of employees at present to whom I could sell the shipbuilding industry in its present form.
Lord ROCHESTER: My Lords, if I may intervene, for the record, may I assure the noble Lord that my reference was to a small shipbuilding or shiprepair yard rather than to the total industry.
Lord LEE of NEWTON: My Lords, I believe there is a little controversy going on about shiprepair yards and so on, but I will not venture into that. There was also the point that the granting of public moneys to this kind of enterprise seemed to be favouring them as against other forms of enterprise. I think my noble friend answered this one very well indeed. One of my Ministerial jobs in days gone by was in the Northern region. I would not care to tell your Lordships how much I spent on private enterprise up there, and the various ways in which one was distributing public money, which was money well spent. I am trying to show that the small amounts involved in this legislation are infinitesimal as compared with the money which both Parties in their periods in Government—very rightly in my opinion—have expended on trying to bring employment to areas which otherwise may have been quite derelict by now.
My noble friend answered the point made by the noble Lord, Lord Rochester, on the relevant body. Clause 1(5) goes
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into the detail of what the Bill means by "relevant body". The question of unequal voting rights was mentioned. I think the whole philosophy of common ownership is at variance with that kind of thing. Indeed the sponsors would argue that there could be a point at which a common ownership firm could be sold out for personal gain by those who had the advantage of unequal powers in that respect. I think my noble friend dealt very well indeed with practically all the questions asked, and as I understand that some of them may well be repeated in Committee I will not go any further. I merely conclude by thanking the House for the way in which it has received this Bill, and by saying I am sure the spirit in which all of us have approached this cannot fail to do a lot of good to a very young and enterprising movement.
On Question, Bill read 2ª, and committed to a Committee of the Whole House.

BRITISH AEROSPACE INDUSTRY
9.27 p.m.
The Earl of KIMBERLEY The Earl of KIMBERLEY rose to ask Her Majesty's Government what are their immediate plans for the British Aerospace Industry, particularly for the Anglo-French Concorde, prior to nationalisation. The noble Earl said: My Lords, first I should like to apologise for my non-appearance last Thursday and for any inconvenience it may have caused to noble Lords. I have for many months been trying to ascertain from Her Majesty's Government what their policy and plans are for the Concorde, whether or not the British aerospace industry is nationalised. I was not originally going to put down this Question, thinking, as many others did, that we would be having the Second Reading of the Aircraft and Shipbuilding Nationalisation Bill this month, but in view of the delay there are some matters that I am going to raise this evening that are so important that they cannot possibly wait till the autumn.
The facts are, one, BAC is closing down its activity as the only test airfield in England capable of supporting Concorde operations; two, in the autumn the civil section of BAC will have to decide whether to make redundant up to a further 4,000 of their workforce, and this out of a total manning level of approximately 11,500 men; three, Concorde 208 is blacked at Fairford with no apparent solution to

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resolve the dispute. I should like to come back to this later on.
On 4th February I put down an Unstarred Question on the future of BAC's flight test centre at Fairford. At that time I could not understand why BAC, backed by the civil servants of the Concorde management board, wanted to shut this vitally important facility, particularly at the very critical stage that Concorde had reached in both its development and sales. Basically, the answers given by the noble Lord, Lord Melchett, were, one, that Fairford cost £2.7 million a year and, therefore, it was too expensive; two, BAC had completed the development work on Concorde and as a result in conjunction with the British members of the Concorde management board it was decreed that there was no justification for letting Fairford remain open; three, any predicted testing and development that might arise in the future could and would be done from Filton; four, any other unpredicted tests or snags that might arise would be carried out and dealt with by the French aircraft 201 from Toulouse.
After much careful thought about these answers, I reached the following conclusions: very simply, that there was a very serious lack of policy and forward planning for the sale and/or lease of Concordes to foreign airlines. My second conclusion was that I could understand why Fairford should be closed if Concorde was a failure, but not only is Concorde not a failure, it is an outstanding and unqualified success. Only last week British Airways announced that it was a phenomenal success and one of the newspaper headlines said there are queues for tickets.
I think we must realise that here we possibly have two conflicting forces, BAC who are the contractors, and the British members of the Concorde management board. These two parties for some extraordinary reason in many instances do not seem to see eye to eye. Bear in mind that BAC do not even own the aircraft, but Her Majesty's Government do. When I say "Her Majesty's Government" it must be realised that the owners are you and I—in other words, the British taxpayers. It is we who have paid £600 million for this wonderful aircraft.
I would be the first to admit that if we were going to start off on a new project
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like this right now and that we realised perhaps what the final cost might be, it might be prudent if we did not start it. But Concorde is here, it is a success, and it has cost us £600 million. So surely any rational person cannot fail to agree that the project should now be exploited to the full, not only to justify the initial investment but also finally to get a profitable return on this money, which can be done if the right initiative and drive is injected into the programme. In other words, do not spoil the ship for a half-pennyworth of tar.
I decided that the only course open to me was to investigate these answers of 4th February in detail. As a result I found that the operating costs at Fairford were £1·2 million after the purchase of the ICL computer and not the figure of £2·7 million quoted and given by the Department of Industry. This figure has not so far been refuted by the Department. I found that Concorde meets its design specification, but in the light of present airline experience it would be a much more acceptable aircraft if both its payload and range could be improved.
Performance is the British design responsibility. In fact BAC have carried out a feasibility study which would necessitate a flying programme to incorporate and test these improvements and modifications. Filton's runway and facilities do not make it suitable for supporting Concorde operations. I consider it perhaps some small measure of my campaign that British Airways crew training and production flying is now, and for the near future will still take place, at Fairford. Furthermore, if the performance improvements of increasing the payload by about 20 per cent. are accepted, then they too will have to be tested from Fairford. I estimated that this method of operation will escalate costs by £1·1 million to £2·3 million a year, and once again the British members of the Concorde management board have not refuted this estimate.
With regard to the French aircraft, 201, to be used as the four company aircraft, it has been stated that BAC will be able to use this aircraft when required, but why has the British instrumentation been removed from this aircraft and French equipment installed? I can hazard a guess; so as to ensure that it is not practical to fly 201 from Britain, let alone

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to know which airfield would be used. Once again 50 per cent. of all costs of the French aircraft will be charged to the British taxpayer. Again my estimate of 20th March of £2·2 million per annum has not been refuted. Therefore, I think that most of your Lordships would agree with me that Fairford is not being closed because of expense reasons or because of lack of work, or because of the suitability of Filton. So I ask myself who is going to reap the benefit of its closure? It is certainly not going to be the British taxpayer who will be helping subsidise a foreign aircraft industry, and it is certainly not going to be the British worker who is going to be made redundant. So what is the reason? Why did the Department of Industry give these answers on 4th February?
I believe that the answer to this lies in a report produced by the unions at Fairford, and I will quote one short paragraph from it:
"In the aircraft industry Flight Test is all things to all men. To the designer it is the testing ground of his ideas and concepts; to the production engineer it is the department that accepts his aircraft; to the project office it is the last hurdle to the Certificate of Airworthiness and the aircraft's entry into service; to the sales team it is the company shop window where the product is demonstrated. To the financial staff it is an expensive department; it is the last obstacle to overcome before obtaining a return on invested capital, i.e., a new aircraft; and, finally, to the customer it is where he collects his new aircraft and his crews are trained."
I believe that if you destroy the flight test capability of an aircraft company you in effect destroy that company. This is endorsed by BAC having to consider its attitude for up to 4,000 more workers, the majority being made redundant at the Filton plant. These are skilled aircraft workers forced into redundancy and thereby destroying the civil capabilities of BAC, and once they have left they will never return to the industry.
I carried out a very small market survey on the attitudes of some of the world's airlines to Concorde and I can state categorically that the majority would buy or lease the aircraft if the range and payload were improved slightly. So I ask: why are we not building a Concorde with these improvements installed? I am sure that it would be more beneficial to Britain to build aircraft than to make Bristol an area of very high unemployment. I have said before that Concorde is a
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success. Why, therefore, does not Britain back it? The reply of the noble Lord, Lord Melchett, will probably be that these improvements would cost money, but President Marcos of the Philippines wants Concorde to transport the delegates to the IMF conference in Manila in October. What better shop window to demonstrate the aircraft, and what a boost for Concorde to carry this august body of people half way round the world! Alas, the only aircraft that might be available for this is 208, which is presently blacked at Fairford as a result of the withdrawal of funds for the support of the flight test centre.
One must ask, therefore, how this dispute can be resolved. BAC does not have the money or the authority to accede or negotiate to the workers' requests, since Concorde 208 is a wholly owned Ministry aircraft on a Ministry airfield and the BAC employees are paid by the Ministry. The noble Lord, Lord Beswick, does not have the power to intervene, since his Board will not have control until after nationalisation. The British members of the Concorde management board do not want to concede because if they did it would be an admission that they have not advised the Secretary of State for Industry wisely. The Department of Employment cannot intervene because there is no dispute with the BAC management.
Lord MELCHETT: My Lords, I am sorry to interrupt the noble Lord, but I think it would be helpful to noble Lords to know that British members of the Concorde management team advise the Ministers at the Department of Industry and if any criticism is to be levelled at anyone it should be levelled at those who take the decisions, who are the Ministers involved, and I am quite happy to have the criticism levelled at me.
The Earl of KIMBERLEY: I take the noble Lord's point, my Lords. In any event, the only way in which I can think that this dispute could be resolved would be by the Secretary of State, Mr. Varley, accepting that all is not well in the land of BAC. Aircraft 208 is now well behind its delivery date to British Airways and, as I have said, it is the only aeroplane that could be used for the IMF conference. Briefly, the workers' request at Fairford is

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that it should remain open until June 1977 to enable discussions to take place between Her Majesty's Government, BAC and the unions so that the possible dissipation of assets prior to nationalisation will not occur. Yesterday I endeavoured to see the Secretary of State or the Minister of State for Industry because I had a very humble proposal which might have helped to resolve the dispute at Fairford. Alas, I could see neither of the Ministers. However, I should like to say briefly what my solution was.
The closure of Fairford should be delayed until 30th June with Lord Beswick being given authority to negotiate on behalf of Mr. Varley to resolve the dispute between the CMB, BAC and the unions. The probability of success is high, the cost of the solution not high—a saving of up to £500,000 due to Concorde not having to fly from Filton and stage through Fairford.
I even thought of a proposed forward programme: from the beginning to the end of August, the aircraft would be on a test programme for British Airways acceptance; end of August to 27th September, crew training for British Airways; 27th September to 18th October a wet lease to Philippine Airlines for the IMF Conference and on the 19th October the aeroplane would be available for the London/New York flight. The image which would have resulted from this would have been good for Britain. It would have been valuable to fly a British Concorde to the conference at Manila and it would have been good for Lord Beswick to get credit for resolving the dispute and it would have been a very good start to the nationalisation of the aerospace industry to see the Government backing Lord Beswick. However, since that did not happen, we now have the situation that BAC has delivered an ultimatum to its workforce to unblack 208 or be removed from the payroll. I can see that this action will cause even more problems throughout the aircraft industry.
The trouble is that the decision to shut Fairford should never have been taken. The history of Government concerning aviation is a long, sad tale, not unlike the mouse's tail in Alice in Wonderland. It has been a chapter of disasters which could have been avoided if only those
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responsible had had the grace to admit that they had sometimes been wrong. It is not too late at this late hour for the Government, in conjunction with the CMB, to announce that, after careful thought, they will reconsider the situation. It has been said that great men admit their mistakes and learn by them, but, alas! small minded men do not have this magnanimity and grace.
In my search for information to try to obtain the truth, I have written many letters to the Secretary of State for Industry. I actually succeeded in having one meeting with him in person but, alas! most of the answers I have received have been misleading or prevaricating. I have been politely told that it was none of my business. I consider that, in this time of so-called open Government, it is my business, along with all the other British taxpayers, to know what is happening to our investment of £600 million.
To show your Lordships how the Department of Industry is trying to give me the brush-off, I shall read the last letter from Mr. Kaufman, the Minister of State. It is very short.
"Thank you for your further letter of 22nd June to Eric Varley about Concorde. This only serves to underline the wide differences of view between us on this topic, which persist in spite of repeated attempts to resolve them by correspondence and by discussion, as well as by replies in the House of Lords.
"I can therefore only suggest that we agree to differ and that you should regard Eric Varley's letter of 14th June as a definitive statement of our decision."
Lord MELCHETT: My Lords, I apologise for interrupting the noble Earl again, but it seems slightly misleading to read out the last of a long series of letters between the noble Earl and the Department without reading, for example, the letter which my honourable friend the Minister of State says the noble Earl should consider as the definitive reply. It is giving a slightly misleading view of a very long correspondence.
The Earl of KIMBERLEY: My Lords, I was in no way trying to mislead anybody, only to say that the Department of Industry and I so far disagree that nobody in the Department wishes to talk to me when I have tried to speak to them. As I said, I have had copious letters and correspondence and I believe that the noble Lord has had copies of that correspondence.

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No doubt your Lordships will remember that I put down a lot of Questions for Written Answer not long ago. When they were answered, it was implied that most of the Questions were not ones which required Ministerial answers but that they were company matters.
I beg to differ. I asked those questions in my search for the truth and also because I needed the information so that it might perhaps be possible for me to make some sort of constructive suggestions about the future of the project. I hasten to add here that, once again, the answers that I got were either negative or of very little help.
Why could my questions not be answered satisfactorily? I am forced to the unhappy conclusion that the Department of Industry has something to hide which would be very unpalatable to the British taxpayer. So I wish to ask Her Majesty's Government if they will agree—and, if not, why not?—the following point: would they agree that industry should be free of Ministerial interference over the supply of information, of cost estimate decisions, fare prospects and so on? For surely it is only by this method that the confidence of the public, the Press, Parliament and the unions will ever be achieved. Alas, even today freedom of information offends the Civil Service and causes flutterings of the Official Secret Act. I think that the one sector that needs the breath of fresh air to blow through it in this instance is the Department that deals with Concorde. If a Minister is asked for a detailed break-down of Goverment spending on civil aircraft and engines the answer is invariably negative, and further inquiries usually reveal that no such break-down exists.
I should like to ask the Government whether they would not agree that the Official Secrets Act be replaced by a Freedom of Information Act? Why can we not have the French approach in this country? The only kind of Government secrets they protect is information affecting national defence. The present Home Secretary is sympathetic towards more open Government. Perhaps now that he is leaving for Europe he could initiate this.
I should not be surprised if the Minister, when he answers for the Government, will say that I am a nuisance,
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that I have been given all the information that I require, and that I have upset foreign airlines. But I am also sure, regrettably, that he will say that there are no further orders for Concorde. So I ask, why is there no prospectus for the future of Concorde? Why are up to a further 4,000 workers probably to be made redundant? Why is Concorde 208 still blacked at Fairford? Why are Philippine Airlines, one of the hottest customer prospects for Concorde, being refused landing rights at London Airport by the Department of Trade? Here is an airline that has bought British aircraft for 20 years, against all the most high-powered and hot salesmanship from the United States. Why is the British taxpayer subsidising the French aircraft industry? Why will the Department of Industry not exploit the improvements of the existing aircraft by increasing the payload by about 20 per cent. at relatively small cost? At a time when public expenditure has to be cut by £1,000 million industry must be supported to improve our balance of payments. Air travel has a major impact on our balance of payments.
I have very nearly finished, but I should like to demonstrate how much the payload modifications can improve Concorde and British Airways' profitability. I have had these figures checked by Flight International and I must say that I do not think that they can therefore be very far out. It is absolutely pointless flying 20 or more empty seats to and from Washington or any other city. Let us assume that each Concorde should fly 3,000 hours a year and that each Concorde seat should return £100 per flying hour. Therefore 20 seats equals £6 million per aircraft per year, or for five aircraft £30 million a year. This more than justifies the relevant cost needed to improve the payload by 20 per cent. In fact within three years it justifies the cost of the Mark II Concorde.
How can the world's airlines ever have any confidence in the aircraft if we do not show any in this country, by refusing to build or set down the keels of more than the original 16 and/or carry out further improvements? Why is it necessary to withhold from the public information such as this? At this very moment there are plans to axe, as I have already mentioned, a further 4,000 jobs from BAC prior to nationalisation. I have suggested to the

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Secretary of State that possibly certain members of the Concorde Management Board might move on, because let it not be forgotten that it was these members who actually recommended the axing of Concorde in 1974—
Lord MELCHETT: My Lords, I am sorry to intervene again, but I think that the noble Earl is not sticking to the traditions of the House, as I understand the position. I am here to answer for the Government. The Government make these decisions—not our advisers. If the noble Earl wishes to criticise the decisions, I suggest that it would make his case more effective if he criticises the people who take the decisions; that is, Government Ministers.
The Earl of KIMBERLEY: My Lords, I apologise. But let it not be forgotten that there was a decision made to axe Concorde in 1974. But it was only through the enthusiasm and foresight of the then Secretary of State for Industry, Mr. Benn, that it was reprieved. I am sure the noble Lord, Lord Melchett, when he answers, will deny some of my allegations, but I will leave your Lordships to judge how correct is my assessment of the situation. My last question to the Government is: How can a Labour Government justify the action of making British workers redundant by transferring their work to France?
9.50 p.m.
Lord GAINFORD: My Lords, my support for the noble Earl is not going to be so much a recital of further facts about Concorde; I merely say that I am one of those British taxpayers for whom there seems to be some rather unpalatable news. Abroad, the British taxpayer seems to be considered quite a peculiar creature. It is considered that he must be a lover of paying his taxes because he pays up so quickly and without much murmuring; but he certainly likes to feel that he is helped in any scheme which shows success, and if it is threatened in any way he wants to know why. One might say that a row is a weak description of what he can rise to if he does not receive a satisfactory reply. I should also like to support the suggestion of the noble Earl about the possibility of replacing the Official Secrets Act by a Freedom of
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Information Act. I recall particularly during the last war, when we had the troops involved so much in censorship, that it was far easier to create the necessary atmosphere of security by telling people what they could say rather than trying to din into them a whole long list of what they could not.
Most of my speech on this Unstarred Question set down by the noble Earl is going to be about other parts of the British aerospace industry, or, rather, the possibilities; and some of it will certainly be echoing another speech of the noble Earl which he made on the 15th July on an Unstarred Question by my noble friend Lord Strathcona and Mount Royal about the policing of the proposed 200-mile Exclusive Economic Zone. In that, he made reference to Dirigibles and Blimps, including a reference to a subsidiary question raised by the noble Lord, Lord Balfour of Inchrye, about using such aircraft for reconnaissance over the oceans. That was in October 1975. On 15th July the noble Lord, Lord Winterbottom, answering for the Government, referred to the lighter-than-air craft, and said it was an interesting suggestion. A number of noble Lords in this House know my interest in this matter. I have spoken on it previously. The last time was about two years ago; and on the occasions when I raised the matter it was mostly in connection with theory. I wanted to wait until I had some facts before I spoke again.
The noble Earl remarked that the airship industry is making slow progress in this country. Perhaps better slow than none at all. In the last few years we have been visited by the Goodyear airship. In 1973 I was with a party of Members of your Lordships' House who were taken for a very pleasant ride in it—a very lovely way of flying, I found, and very pleasant travel. As regards airship construction in this country, I believe that at Cardington there is a company called Aerospace Development Company, and there was a notice in the Press that it had received an order from Venezuela for a number of lighter-than-air craft. The facts, I believe, are that so far one airship is being constructed, and if it proves to be successful further orders will follow. It seems that at least we have some form of export trade in that line.
One slightly fortunate result of the Unstarred Question having been delayed

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since last Thursday is the fact that last Friday there was a television programme about a man who constructed his own airship. I did not see all of it; but I arrived home to see the last ten minutes of it. I do not know whether any of your Lordships saw anything of it. The airship concerned was what I would call a blimp; and it was a form of flying which television described as "deliciously primitive". In fact, it was made a victim of wind variation, but it showed how safe it was because the helium did not catch fire when it crashed into trees; although after it had collapsed it was taken away, repaired and was soon in the air again.
But there are people at work in this country trying to develop and design a completely new form of lighter-than-air craft. This new design will have hardly any resemblance to the old airship, the very mention of which conjures up mental images of famous disasters of the 'thirties or the lurid destructions of some of the airships in World War 1. If the new design can become a fact, almost a door-to-door transport of freight could be achieved and indeed leisurely travel for passengers. If some of the derelict dock areas of London can be made into airship ports, taking into consideration that much of this area has been considered for the vital matter of housing, it could be possible to travel from central London to a point 200 miles away with about 2 hours' flying and a short time at each end for the necessary door-to-door travel. At present, I believe, it takes a good 4 hours to get from London to Paris.
On July 14th, this month, there was a Question asked by my noble friend Lady Emmet about the congestion at Heathrow. This resulted in ten minutes of lively subsidiary questions and answers. The Airship Transport Service which I mentioned is being attempted and designed to enable a considerable reduction of the pressures on present airports, and there is also the fact that the airship airport would not require as much space as do the present airports for modern aircraft.
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So, as the last words on that, I ask whether Her Majesty's Government could possibly consider an airship programme in their future policy. Finally, another reference to the speech of the noble Earl on the 15th July about our coastguard service. Could Her Majesty's Government possibly consider improving our security services, and possibly lifeboat and ambulance services, by the inauguration by a service similar to that in the USA called the Civil Air Patrol? This organisation is made up of private aviators who liaise with the authorities and have full recognition as a national service. Private aviation in this country is hampered not only by expense but by very stringent regulations, all of which are very necessary because this country has become one of the greatest international centres of commercial aviation. Private aviators would be only too happy to devote their skills to the service of their country.
There was an attempt some years ago by a private organisation to form such a service. It was called the National Air Guard. It did manage to carry out some work to help the police and the coastal and ambulance services. In fact, for a short period I was a member of that organisation. It died a death, not as a result of lack of support but because the authorities could not give it enough recognition. Personally, I can see their point of view. They would not wish to discourage the zeal and enthusiasm of the members. In fact they probably would say that they wished more people were so publicly spirited. But here was an organisation run almost on military lines. The chief organiser was at the time a foreigner, although he is now a naturalised Englishman. The great danger is if the wrong people get into it. If something similar to the Civil Air Patrol could be formed, it would not lack recruits. It could provide great assistance to the military and civil services. I am glad that we have been joined in this debate by the noble Earl, Lord Kinnoull, and I am sure that after we have heard him we shall welcome the comments of the noble Lord, Lord Melchett.
10 p.m.
The Earl of KINNOULL: My Lords, despite the late hour it was with eager anticipation that I took my seat this evening to listen to the noble Earl, Lord Kimberley, and I was relieved to see him in his place in order to ask the Question which had been put down on the Order Paper last Thursday. I am sure the whole House are grateful to the noble Earl for raising his Question and for the very energetic interest that he always takes in pursuing the welfare of the Aerospace Industry, even if perhaps tonight he has had to resort to what one might term a "verbal bashing". I am not sure whether it was at the BAC or at the Department of the noble Lord who will be replying, but I am sure he will be bashing back.
I pick two small quarrels with the noble Earl on his Question. First, his Question asks: what are the Government's immediate plans for the British Aerospace Industry prior to nationalisation? That must presuppose that what is taking place in another place at this moment, and what is due to take place tomorrow and the following day, is that the Bill will get through quite unharmed. Some of us feel from what we read about the majority of the present Government in another place, that the Bill may not get through at all. Possibly the timing of this subject tonight is not too happy.
The second quarrel that I raise with the noble Earl is that if one assumes that nationalisation will come, it will happen under the present Bill in two months. The noble Earl is restricting the reply of the Government to cover a period of two months when I am sure both he and the whole industry would like to see what the Government's plans are for the next 10 years. Knowing his skill and recognising what he has already been through earlier today, I hope the noble Lord, Lord Melchett, when he replies, will be able to say something about the general policy not only of the Concorde but also of other projects which are of interest.
I hope that the noble Lord, Lord Melchett, will be able to give two positive assurances this evening. Because, in the view of everyone, the industry has suffered
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far too long from the buffeting of un-certainty regarding its future, if the Government lose their Bill on nationalisation this Session, I hope that the noble Lord will be able to give us a categorical assurance that they understand the damage that can occur to the industry from this continuing uncertainty and that they will drop the Bill and not reintroduce it for yet a third year.
The second assurance I seek from the noble Lord is that, if the Bill succeeds and becomes an Act, the Government will do everything in their power to retain and encourage the impetus, drive and hard-earned successes of this magnificant industry and so continue to win the respect of the world and the gratitude of the many foreign customers. To achieve this second assurance, the noble Lord will need to add one further vital ingredient; that is, that the Government's policy towards the industry will not waiver or stray in the face of the occasional economic storm, and that their determination will be to retain a steady, workable flow of research and development investment to continue to sow the seed corn in new projects which may be harvested, one hopes, anything from 5, 10, 15 or 20 years' hence.
The noble Earl's Question tonight reminded me of a very similar debate some five years ago when one shrewd noble Lord, in referring to future projects, asked: what is in the shopping basket? Looking back at that debate, there was a certain luxury in those days which was clearly not appreciated at that time. There were then over five aircraft projects in the basket, which of course included Concorde. I suggest to the noble Lord, Lord Melchett, that tonight there is only one, although he may give me a different answer.
One major aircraft project is now in the pipeline. I refer of course to the MRCA, the cost of the programme for which is twice that of the Concorde. I should like to ask how this project is progressing. For example, have the first production orders yet been placed, and is the timescale of delivery to the three air forces

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still the same? Another project which was cancelled in 1974, at the time of the oil crisis and the inevitable air travel recession, was the HS.146. I understand that last February Hawker-Siddeley asked the Government for a design study to be set up again, in order to look at this project. I know that from time to time there have been questions on this subject in another place, but can the noble Lord, Lord Melchett, say what has happened to that request, what points are the Government still considering and will a decision soon be reached?
Again, looking at the other major company, BAC, I believe that for some time they have been studying a possible project for a 150-seater airbus; and I should like to ask whether the Government have been asked about research and development or any design studies for this.
Finally, on specific projects, I should like to ask the noble Lord about Rolls-Royce. I think that most of the House will have seen that, in a recent Press statement, the chairman of Rolls-Royce stressed what seemed to be an urgent need for further Government support towards the development of a medium-sized engine. I think it would be very helpful, even at this late hour, if the noble Lord could refer to that tonight.
Of course, the noble Earl referred in his Question, as well as in his speech, to Concorde. I think that the most convincing argument against the Concorde "knockers" is to look at the passenger response which British Airways are having on the two routes which they now operate, to Bahrein and Washington. If one looks at the passenger load factor between London and Washington alone—and here I mean both ways—one sees that it is as high as 93 per cent., and indeed is fully booked until September. This is despite the cost of the air fares that they have to charge, and despite the fact that Washington is not nearly so attractive as New York to many business people. I feel that that figure alone must encourage other airlines which are hovering on the point of making the decision to go supersonic.
I agree that every avenue should be explored to hasten the sales of Concorde, and one thing I always find it difficult to understand is why the Government have not as yet set up their own leasing system
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to would-be airline customers. Surely, it would pay them, even on terms which are more favourable to the airlines than to the Treasury, to set up a leasing system which would encourage both sales and getting Concorde further into service.
The noble Earl referred to the present "blacking" of BAC on the delivery of their Concorde III to British Airways. I do not know the ins and outs of this flatter at all, and I am not taking a stand on it. But what I do know is that this move may restrict British Airways' operations of Concorde and only do harm to their splendid flag carrying demonstration to world markets of both the potential and the success of Concorde. British Airways Concorde operations not only help to sell Concorde but also help its future production. Any question about aerospace that is raised in this House quickens the pulse of those who are interested in it, and I am only sorry that tonight there are so few people whose pulses are able to be quickened.
I should like to ask a final question of the noble Lord. It concerns Concorde's route to Australia. My noble friend Lord Orr-Ewing, who unfortunately could not be here tonight, has sought on a number of occasions to obtain information on the progress of the route to Australia. I hope that tonight the noble Lord will be able to tell us whether agreement has yet been reached and when the service is likely to go into operation.
I should like to thank the noble Earl for raising this Unstarred Question. I has indeed been a fascinating debate, which has ranged from Concorde to airships, and I look forward to listening to the inspiring reply of the noble Lord, Lord Melchett.
10.11 p.m.
Lord MELCHETT: My Lords, I am very grateful to the noble Earl, Lord Kinnoull, for that preliminary advertisement of my speech and I hope that I can live up to his expectations. Certainly the noble Earl is quite right in saying that it has been a very wide-ranging debate and I am grateful to him for mentioning some of the many future and current possibilities for British aerospace. If I may say so to the noble Earl, Lord Kimberley,

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he tended, rather against the terms of his own Unstarred Question, to concentrate exclusively on Concorde. One is in the difficulty when replying to Unstarred Questions of this kind of knowing whether to reply to the Unstarred Question on the Order Paper, or whether to reply to the speech of the person asking the Unstarred Question, or whether to reply to the speeches of everybody who has taken part in the debate. My understanding is that it is usual to reply to the Unstarred Question on the Order Paper. If, therefore, I make a speech that does not deal exclusively with Concorde, the noble Earl will understand why and will not, I hope, accuse me of attempting to dodge the issue or failing to answer some of his questions.
There can be no doubt about the Government's commitment to Concorde, a determination which we share with our French partners in this uniquely collaborative project. I was sorry that the noble Earl did not make more of the collaborative nature of the project and of the fact that any future developments and all the past successes are due not only to British aerospace and the British people involved but to our French partners as well. This determination to ensure Concorde's future was reaffirmed at the meeting between my honourable friend the Minister of State at the Department of Industry, Mr. Kaufman, and the French Transport Minister, M. Cavaille, on 29th March, when both Governments agreed that the key to the success of the project and the prospect of further orders lay in the profitable operation of the aircraft already sold.
We have always maintained that the acid test of Concorde will be on the North Atlantic route, where the load factors of over 90 per cent. achieved on the Washington route are proof of the attractiveness of Concorde to the traveller. Indeed, on many flights airlines have had to turn passengers away. The noble Earl, Lord Kinnoull, made particular reference to this point. I understand that on the London-Washington route the load factor has been about 93 per cent. and that on the Washington-London route it has been about 92 per cent. These are very encouraging figures. The London-Bahrein and Bahrein-London figures are considerably lower—34 per cent. and 63 per cent. respectively—but I think that we are
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all agreed that the London-Bahrein route has never been seen as a complete route in itself but merely one leg of a longer route.
The Earl of KIMBERLEY: My Lords, when the noble Lord says that the load factor is 93 per cent., it is 93 per cent., is it not, of 80, not 100, seats because of various conditions? The Americans will not allow it to fly out fully laden.
Lord MELCHETT: Yes, my Lords, the noble Earl is quite right. The figures I have given are a percentage of the seats available in practice, not the theoretical payload of 100 seats altogether. The Government are working vigorously to open up other routes for Concorde, and the most important of these routes is to New York. Mr. Kaufman personally attended the environmental hearing in January, after which Secretary Coleman gave permission for Concorde to operate to New York and Washington. Access to New York has been delayed by legal problems but the British and French Governments are assisting the airlines to overcome these. Noble Lords will also welcome the recent developments in Australia where, as a result of the Environmental Impact Statement prepared by British officials in association with British Airways and the British Aircraft Corporation, the Australian Government has decided that Concorde may fly into Melbourne.
In response to the question put by the noble Earl, Lord Kinnoull, about the route to Australia, I do not think there is anything I can add to what I said in response to his noble friend Lord Orr-Ewing when he asked me a question about that very point quite recently, but it is something to which the Government continue to attach the utmost importance.
The Earl of KINNOULL: My Lords, if, as I think, the noble Lord is now moving away from the subject of New York, I wonder whether he can advise us whether there are any further environmental inquiries to be held in New York or whether now, as I understand the position, it is a question of the United States Government taking the decision after this period of 18 months of operation to Washington?
Lord MELCHETT: My Lords, so far as I know there are no more environmental inquiries to be made, but of course it is a matter for the American Government and the City of New York and the other authorities concerned to make decisions about that and not for me. So it is not necessarily something that lies in my hands.
The Government are reinforcing the general support for Concorde with specific measures aimed at bringing the aircraft into service with other interested airlines. They are providing the strongest possible support to the negotiations in progress with Iran Air, where there is the prospect of the sale of two aircraft, and with Japan Airlines, who are actively interested in leasing two Concordes. I can assure noble Lords that any serious inquiry from airlines will be pursued with vigour if it offers the possibility of a fair and reasonable return in relation to the investment in the aircraft.
The Fairford flight test centre is having to be closed. As I informed your Lordships on the 4th February, the amount of testing still required on the Concorde is not sufficient to justify keeping this expensive facility in operation, nor are there any foreseeable new civil aircraft projects which will call for such a facility. I feel sure that noble Lords share my regret that the closure decision has led to the "blacking" of Concorde 208, which, whatever the reasons, is bound to be detrimental to Concorde's prospects, both with the airlines which have purchased it, and particularly of course as regards possible sales to other operators.
I do not intend to answer all the detailed questions asked by the noble Earl because I think that not only would I not have the opportunity to answer any of the other points mentioned by other noble Lords, but also I should keep the House here until well after midnight. But I should like to say to him that the suggestion that the Government are not taking all reasonable steps to exploit Concorde is one which I simply cannot accept. To state categorically, as the noble Earl has done, that airlines would purchase Concorde if it were to have a greater range than is now the case simply flies in the face of the reality of our problems. We are faced with the Coleman decision by which, until a 16-month trial period is ended at each of Dulles Airport, Washington and Kennedy Airport—and this will
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not be until late 1978 at the earliest—no airline other than British Airways and Air France will be allowed to fly into the United States. The airlines most interested in Concorde wish to fly to the United States or they wish to fly to Japan.
It is to cope with these, the real problems, that British and French Ministers on the 29th March expressed their determination to open routes. That is why we are working strenuously to open routes, with considerable success as is shown by the Australian decision. That is why my honourable friend the Minister of State took part in the Coleman hearing in January, again with considerable success as is shown by the decision reached by Mr. Coleman. That is why we are supporting British Airways in their legal argument for access to New York.
To suggest that nothing is being done to exploit Concorde other than—if I may say so with great respect—the noble Earl's letters to various airlines, is to belittle the great efforts being made by the British Aircraft Corporation to sell and lease the aircraft. All the airlines with an interest in Concorde, including Philippine Airlines, are visited. All possible means of exploiting the aircraft, sale and lease, are investigated. Discussions with Iranair are well advanced for a sale. A lease to Japan Airlines is under discussion, and leases with other Far Eastern airlines are being looked at.
As to further investment, whether in additional aircraft or in major modifications, the Government have made clear that this would have to be justified by the returns. We are at one with our French opposite numbers, who are adopting a similarly businesslike approach, that no convincing case has yet been made out for further major expenditure. Meanwhile developments continue to be scrutinised and authorised on strict cost effective criteria. I would hope that that approach, besides having the full support and agreement of our French partners, would be something to commend itself to all sides of this House.
The noble Lord, Lord Gainford, mentioned airships. I am certainly well aware of the interest shown in this form of air transport. I can assure the noble Lord that the Government are ready to consider all proposals from firms for the development and the production of commercially viable airships. We are in

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contact with aerospace developments on the issue he raised. Elsewhere on the civil side, the industry is faced with a severe shortage of work. This is common to manufacturers throughout the world. As a consequence of the 1974 fuel crisis and the recent world economic depression, the growth of air traffic is currently very slow and, pending the expected improvement, airlines are simply not buying new aircraft in any substantial numbers.
I regret to say that over the past few years, the major United Kingdom firms have failed in some instances to invest in improvements and further developments of their existing major aircraft, which might have strengthened their position in the present difficult market conditions. For example, although HSA are continuing to build HS.748s and planning to introduce a re-engined version of the HS.125 next year, both in anticipation of further orders, the only really new project in recent years has been the small commuter airliner, the SD.3–30, developed and now being produced by Short Brothers, a Government-owned company.
This lack of confidence by our firms cannot be fairly attributed to nationalisation. The Government are doing all they can to counteract the firms' timidity. They have enabled the BAC 1–11 line to stay open by underwriting production of a small order from Roumania and the manufacture of parts for a further five aircraft on a speculative basis. Following HSA's abandonment of the HS.146, which had been launched with major public assistance, the Government have kept open the option to restart the project wholly at public expense.
The noble Earl, Lord Kinnoull, asked about current proposals. The Government are currently giving urgent consideration to requests from BAC to extend the underwriting on the 1–11, and from HSA to increase the amount of work being done under the holding contract. Their decisions on these questions will have to take account of the public expenditure problems we are now facing, the willingness or otherwise of the proponents to show their confidence by sharing the risks and a realistic assessment of the market prospects. I should add that in the case of the HS.146, Hawker-Siddeley are not recommending a relaunch of the project precisely because of
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their uncertainty about the market prospects—and they have not volunteered to invest any of their own money in the project at this stage, notwithstanding the compensation provisions in the nationalisation Bill.
The Earl of KINNOULL: My Lords, I am grateful to the noble Lord for that reply. I thought he spoke about sharing the risk, and that was one of the reasons for the delay. Is it a risk that the companies who are about to be nationalised will be putting in risk capital? In which case, would the noble Lord really think that the directors of these companies would do this in the interests of their shareholders?
Lord MELCHETT: My Lords, I did not say that was one of the reasons for the delay; but obviously the Government, in reaching a decision about putting money into any of these projects, would look to see what attitude the companies themselves took, and their own estimates of the commercial viability and prospects of the projects under discussion. But continuing commercial investment by the shareholders in a company due to vest under the Bill is fully protected under the terms of the Bill. I look forward very shortly indeed to discussing the Bill with the noble Lord, and see absolutely no reason to give him any undertakings on the hypothetical questions he raised about the progress the Bill is currently making successfully in another place.
The Government are providing strenuous support for the companies in their efforts to sell their existing aircraft—both through the overseas Posts and at home, including maximum assistance through ECGD. There are possibilities for the sale of more Tridents to China and of BAC 1–11s in several different countries. Such orders are proving very difficult to secure, but I can assure noble Lords that the Government will not relax their efforts to do all they can to help the companies to land them.
As to future prospects, there is good reason to believe there will be a resumption of steady growth in airline traffic in the 1980s which will lead to substantial purchases of new aircraft. The precise kinds of aircraft which will be required are still not clear. The situation is fluid because the airlines cannot yet define their requirements with any precision.

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It is clear that the investment levels which will be required to launch any projects ranges from around £200 million for a small feeder aircraft to £1,000 million for a completely new 200-seater. Hence, with the possible exception of the smallest kind of aircraft, the Government are convinced that any of these possible projects will need to be undertaken collaboratively in order to share the very large investment required and to widen the market possibilities. Even with collaboration, the commitment of individual partners will be very high indeed. We must, therefore, seek out projects with a high potential for profit.
There are various possibilities for collaboration, both within Europe and between European companies and American companies. All possibilities are being fully explored. Pending nationalisation the Government are doing all they can to encourage and assist United Kingdom firms and the Organising Committee under my noble friend Lord Beswick to narrow down the options, and to examine all the possibilities for collaboration on a sound commercial basis, whether with the principal European firms or with American companies. The United Kingdom companies are engaged with the French, German and Dutch manufacturers (the Group of Seven), in joint studies and in various bilateral discussions on possible projects and collaboration. The Organising Committee are setting up studies with the French and Germans on the Airbus and with the French on the HS. 146 and the future 150-seat aircraft. Individual discussions are also taking place with the United States' manufacturers about possible transatlantic collaboration.
The Government are continuing to stimulate these industrial discussions, and their efforts over the last four months have included a discussion on future collaboration generally between my right honourable friend the Prime Minister and the French President during the latter's recent visit, a meeting between the Prime Minister and Mr. Wilson of Boeing at which my right honourable friend the Secretary of State for Industry was present, and two meetings in the last four months between the Minister of State, Mr. Kaufman, and his French counterpart on Anglo-French collaboration, including studies on a possible advanced supersonic transport.
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Officials of the Department of Industry are also engaged in ongoing discussions with their opposite numbers in France, Germany and Holland to monitor progress in the European industrial discussions.
The noble Earl, Lord Kinnoull, asked me about the MRCA project in particular, As he knows, a very substantial RAF requirement for the Tornado, as it is now called, has been announced. It is for my right honourable friend the Secretary of State for Defence to announce when production may start. I trust he will be able to do this soon. The Government look forward to a successful joint programme on this aircraft with the Germans and Italians, and fully recognise the importance of the programme for the United Kingdom industry.
My Lords, I hope I have said enough to indicate the wholehearted and unremitting efforts which the Government are putting into clearing the way for a profitable long-term future for the aircraft industry, but I should mention that with the transfer of Rolls-Royce (1971) Limited to the NEB the Government also look forward to a profitable long-term future for that sector of the industry. To conclude, the Government are committed to ensuring, so far as they possibly can, that the conditions exist for the United Kingdom aircraft industry to carve out a vigorous and successful future for itself, based on sound commercial projects. We are taking all the necessary action towards this end (the most important being nationalisation itself) in order to eliminate the wasteful competition and overlap of the past. The industry must pick up the challenge facing it, but the Government are continuing, and will continue, to do all they can to enable it to do so successfully.

LONDON TRANSPORT BILL
Brought from the Commons, read 1ª, and referred to the Examiners.
SUFFOLK COASTAL DISTRICT COUNCIL BILL
Returned from the Commons with the Amendments agreed to.
YORKSHIRE WATER AUTHORITY (RIVER DERWENT] BILL [H.L.]
Returned from the Commons with Amendments; the said Amendments considered and agreed to.
  ASBESTOS: HEALTH RISKS
  ASBESTOS: HEALTH RISKS
  SURVEILLANCE OF FISHING AND PETROLEUM ACTIVITIES
  SURVEILLANCE OF FISHING AND PETROLEUM ACTIVITIES
  NORTHOLT AERODROME
  NORTHOLT AERODROME
  UNPAID APPOINTMENTS BY MINISTERS
  UNPAID APPOINTMENTS BY MINISTERS
  INDIRECT TAXATION
  INDIRECT TAXATION
  INDIRECT TAXES BORNE DIRECTLY BY HOUSEHOLDS—1974
  INDIRECT TAXES BORNE DIRECTLY BY HOUSEHOLDS—1974