Sitting of 18 March 1976

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
  BRITISH RAILWAYS BILL (By Order)

    BRITISH TRANSPORT DOCKS BILL (By Order)
    Orders for Second Reading read.
    To be read a Second time upon Thursday next.
    BRITISH TRANSPORT DOCKS (FELIXSTOWE) BILL (By Order)
    Order for Second Reading read.
    To be read a Second time upon Wednesday next at Seven o'clock.

    BRITISH TRANSPORT DOCKS BILL (By Order)

      LONDON TRANSPORT BILL (By Order)
      Order for Second Reading read.
      To be read a Second time upon Thursday next.

ORAL ANSWERS TO QUESTIONS
  NORTHERN IRELAND

    Protection of Employment (Northern Ireland) Act
    Mr. Powellasked the Secretary of State for Northern Ireland what consideration he has given to the operation of the Protection of Employment (Northern Ireland) Act after 1977.
    The Minister of State, Northern Ireland Office (Mr. Stanley Orme): I shall be considering the matter in due course in consultation with both sides of industry.
    Mr. Powell: Is the right hon. Gentleman aware that, especially in the present
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    employment situation in Northern Ireland, any sharp transition as soon as the end of 1977 would be highly dangerous from many points of view? Will the right hon. Gentleman ensure that this matter is pursued with a view to continuing derogation?
    Mr. Orme: I take the right hon. Gentleman's point, but he will be aware of the present economic situation. I do not think that there will be a stampede of people looking for employment in Northern Ireland. As the right hon. Gentleman is aware, derogation does not end until 1977. The bodies that I shall be consulting through the Northern Ireland Economic Council will include both sides of industry—namely, the trade unions and the employers.
    Mr. McCusker: Is the right hon. Gentleman in a position to tell us the level of applications for work permits in Northern Ireland?
    Mr. Orme: I shall need notice before I can answer that question. The hon. Gentleman may be interested to know that in June 1975 there were 5,598 immigrant workers—that is, 1·1 per cent. of the total work force—in Northern Ireland.

    Political Situation
    Mr. Watkinsonasked the Secretary of State for Northern Ireland if he will make a further statement about the political situation in Northern Ireland.
    Mr. Luceasked the Secretary of State for Northern Ireland what action he proposes to take following the completion of the work of the Northern Ireland Convention.
    Mr. Biggs-Davisonasked the Secretary of State for Northern Ireland whether he will make a statement on future arrangements for democratic representation in Northern Ireland.
    Mr. Gowasked the Secretary of State for Northern Ireland whether he will make a statement about the future constitutional status of the Province.
    Mr. Beithasked the Secretary of State for Northern Ireland what arrangement he proposes to make for the continuation of direct rule following the endine of the Constitutional Convention.
    Mr. Martenasked the Secretary of State for Northern Ireland if he will make a statement on the Convention.
    Mr. Flanneryasked the Secretary of State for Northern Ireland whether, in view of the failure of the Convention, he has any plans within the context of direct rule for the further democratisation of Northern Ireland; and if he will make a statement.
    The Secretary of State for Northern Ireland (Mr. Merlyn Rees): I refer to my statement of 5th March. The Government's policy in Northern Ireland is to provide positive government so as to minimise hardship in the short term and to bring about real and lasting improvements in the long term.
    In pursuance of this, the Government have decided that their strategy for economic development in Northern Ireland needs to be reassessed not simply in the light of the present economic situation but, more importantly, looking ahead over the next few years. I shall be consulting the Northern Ireland Economic Council and shall want to take into account constructive ideas from any quarter, including the CBI and ICTU.
    The security forces, with the full support of the Government, will continue to do all that is necessary to deal with security problems, to restore law and order and to bring before the courts criminals from all parts of the community. The examination which I announced on 12th January into actions and resources required for the next few years to maintain law and order in Northern Ireland is making good progress.
    Mr. Walkinson: I thank my right hon. Friend for that reply. In his statement he said that he would be prepared to receive constructive and responsible ideas on the future of Northern Ireland from the political parties in Northern Ireland. Has my right hon. Friend received any such representations? Is he satisfied that the channels for such representations remain reasonably open?
    Mr. Rees: I think that the channels are reasonably open. The Leader of the UUUC is in the House, as are the leaders of the SDLP and the VUP. I am always prepared to receive ideas from anyone. Yes, I am content that at this pitch of
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    time it is possible to get ideas from the leaders in Northern Ireland.
    Mr. Biggs-Davison: Despite what the right hon. Gentleman has just said, is he not aware—of course, he is—that since the Macrory reforms there has been less democratic control of local government and regional services in the Province? The right hon. Gentleman may wish to bring before the House in due course, as part of his policy of positive direct rule, proposals for the improvement of procedures here for the scrutiny of expenditure and legislation, and possibly additions to representation in the House.
    Mr. Rees: The hon. Gentleman's last point is not something that happens overnight, irrespective of the arguments about it. Representation in the House is part of a wider devolution argument and the wide-ranging reforms taking place later in this decade. The Macrory reforms were made before this Administration or the last took office. I understand that the UUUC is in favour of local government reform, but the SDLP members tell me that they are not in favour of it. I am looking at the question of dealing with legislation. There are some difficult aspects of this subject. I hope that when we renew the order, or perhaps before, I shall be able to say something about this matter.
    Several Hon. Members——
    Mr. Speaker: Order. Seven Questions are being answered together and I intend to call the hon. Members whose Questions they are before anyone else.
    Mr. Beith: Why does the right hon. Gentleman think that the size of Northern Ireland representation in this House has anything to do with devolution, since his right hon. Friend does not propose to reduce the representation of Scotland or Wales here? Is he satisfied, now that direct rule is not of a very temporary character, that there will be adequate opportunity in this House to raise wide-ranging questions of legislation and that, for example, legislation on social matters will not be held up for lack of time?
    Mr. Rees: I am aware of the concern on the last point. This is not an easy matter, given the legal arrangements in Northern Ireland, but I am looking at it. I do not believe that we can provide for

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    extra representation in the middle of a Parliament. That was the point I was making. There are wider aspects to this question. If the hon. Gentleman is asking what views have been put to me, I can tell him that one major party in Northern Ireland does not want extra representation for the Province at Westminster. What one side says is usually what the other side does not say. That is one of the problems we face.
    Mr. Flannery: Does not my right hon. Friend agree that one of the major formative influences towards a peaceful solution in Northern Ireland is the Labour movement, which encompasses trade unions and trades councils? Do they not embrace both Catholic and Protestant workers, who have the same problems when it comes down to the nitty gritty of life? Is my right hon. Friend aware of any growth or re-birth of trades councils which would help in this direction?
    Mr. Rees: I am not aware of any growth of trades councils which, in their 120 or 130 years' history in this country, have been concentrated in urban industrial areas. I freely admit the excellent work done across the divide by trade unions when it gets to what my hon. Friend called the nitty gritty. Any growth which takes place tends to fall apart, and this is one of the basic problems in Northern Ireland.
    Mr. Luce: I agree with the Secretary of State's broad approach to direct rule. However, to the extent that there is a political vacuum in Northern Ireland, does this not open up greater opportunities for the men of violence to step in? Will the right hon. Gentleman open his mind to the possibility of evolving a modest form of political forum, whether by strengthening local government or by establishing a political advisory committee?
    Mr. Rees: I will certainly keep an open mind, but experience over the last four years does not suggest that I should follow the hon. Gentleman's suggestion. I must work through the elected representatives in this House. This is not a cheap party political point—hon. Members will know what I argued at the time—but if there is a vacuum it was created when Stormont was ended and not when the Convention was ended.
    Mr. Gow: Since the period of direct rule is now to be without a limit of time, would the right hon. Gentleman reconsider his earlier answer about the representation of Northern Ireland in this House? If the people of Northern Ireland are to have parity with the citizens of other parts of the United Kingdom, should there not also be parity of representation?
    Mr. Rees: In one respect the people of Northern Ireland have more than parity: no other part of the United Kingdom with 1½ million people has five Ministers concentrating on its problems. Hon. Members should not think that extra representation for Northern Ireland in this House is a way of solving the problems of Northern Ireland. It is a divided society. I have visited many parts where even to talk about extra representation in this House is to fly in the face of history and cultural attitudes. The time to look at this problem is when the divide has been healed and the two groups are working for the good of Northern Ireland.
    Mr. Marten: Is the right hon. Gentleman aware that all we are asking for is plain common justice for the people of Northern Ireland? Are not the Government abandoning the democratic principle of equal representation if they do not get the Boundary Commission to look at this matter with a view to having 20 seats for Northern Ireland rather than 12?
    Mr. Rees: This problem does not go back just over the last four or five years. When the Commission was set up, there was a separate Parliament for Northern Ireland. I do not believe that this is a question of justice. It would be if one were comparing Northern Ireland with the rest of the United Kingdom.
    I come back to the basic point that this is a community which is divided so much that in some places there is no interest, even among decent people who are not associated with extreme Republicans, in extra representation at Westminster. I suggest that we should hear at some time what the SDLP thinks about extra representation.
    Mr. Stonehouse: Could not the Secretary of State deal with this proper claim for increased representation from

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    Northern Ireland and also with the problem he has just mentioned by introducing a system of proportional representation, so that all communities could be represented?
    Mr. Rees: It would be rather odd to have proportional represention in only one part of the United Kingdom. There is proportional representation in local government elections and any possible Assembly elections in Northern Ireland. As I have learned over the last two or three years, there is no simple answer to Northern Ireland's problems and no device by which we can achieve what we want in Northern Ireland. It is a long, slow process.
    Mr. Evelyn King: May I press the right hon. Gentleman on the subject of extra representation? How can he argue in logic that it is perfectly possible in mid-Parliament to introduce a Convention, or close it down and thus deprive the Province of representation, but impossible in mid-Parliament to provide proper representation in this House?
    Mr. Rees: The Convention concerned only Northern Ireland, not the rest of the United Kingdom. I would advise the hon. Gentleman that if he is looking for a part of the United Kingdom to which to apply logic, he is now applying it to the wrong place.
    Mr. Kilfedder: Does the right hon. Gentleman not agree that historic and cultural attitudes have nothing to do with fair democratic representation for the Province in this House? Will he recollect what he and his colleagues said in 1967, 1968 and 1969 and meet the demands for justice in Northern Ireland now? I do not think he should bask too much in the warmth——
    Mr. Speaker: Order. We are here not to know what the hon. Member thinks, but to hear his question.
    Mr. Kilfedder: I hope that the Secretary of State is not misled by praise bestowed upon him——
    Mr. Speaker: Order. That is an expression of opinion.
    Mr. Rees: I am not basking in anybody's praise, or the opposite. I recall what was said in 1967 and 1968, but the arguments at that time are not on a par with the question of representation.
    Mr. McNamara: Is my right hon. Friend aware that there are many parts of the mainland that would like equality of representation and treatment with Northern Ireland, especially in the granting of economic and financial aid towards dealing with our considerable unemployment? Is he further aware that it ill-behoves Opposition Members from Northern Ireland to make strong pleas about representation when one considers their history and attitudes until they lost their own Stormont Parliament?
    Mr. Rees: There is some justice in my hon. Friend's last comment. The subject of representation and a new form of Assembly is a complicated matter in a confused cultural and political situation. I do not believe that extra representation should be seen as the "Open Sesame" to solving the problems of Northern Ireland. I admit that the subject of the money spent in Northern Ireland frequently arises. I can only say to my hon. Friend what I say to people of all political persuasions in this country; there are real problems in Northern Ireland and it is part of the United Kingdom.
    Mr. Michael McNair-Wilson: In the event of the House agreeing to have direct elections to the European Parliament in 1978, will Northern Ireland be represented? If it is possible to draw constituency boundaries for that Parliament, why is it not possible to rearrange the present boundaries to allow greater representation in this House?
    Mr. Rees: It is not a matter of technicalities. It is not a matter of laws in this House. Northern Ireland is a split community——
    Mr. Beith: So is Scotland.
    Mr. Rees:—and if the hon. Member for Newbury (Mr. McNair-Wilson) believes that doing this would make people in South Fermanagh suddenly after 200 years, say "Eureka—we want to be part of the United Kingdom", he is very wrong. That is a South-East England approach.

    RUC Station, Lurgan
    Mr. McCuskerasked the Secretary of State for Northern Ireland when it is hoped to start rebuilding Lurgan RUC Station.
    The Minister of State, Northern Ireland Office (Mr. Roland Moyle): The Police Authority for Northern Ireland, which is responsible for the provision of police buildings, expects work on the rebuilding of Lurgan RUC Station to commence later this year.
    Mr. McCusker: Is the hon. Gentleman aware that Lurgan police station was perfectly positioned to command the flashpoint area of the town and to protect both the business community and the minority Protestant community, which lives in northern Lurgan? Is he further aware of the bitterness in the town at the delay of three years in commencing to build the police station? Will he do all in his power to reduce any further delay?
    Mr. Moyle: I expect work on the police station to begin later this year. It was destroyed in 1973, and in the intervening time there have been continual revisions of police requirements and security requirements for the station. That has caused the delay in the planning procedure, which is now nearly over.
    Mr. Powell: Is the hon. Gentleman aware that the use of the present building as a police station has deprived the people of a large area of one of the principal places for public meetings, and that therefore it is important that there should be no further delay?
    Mr. Moyle: Yes, it is expected that the new station will be available for occupation by the RUC towards the end of 1978. We are very grateful for the way in which the Lurgan District Council has made its town hall available for the police, and we hope that the building of the police station will not be too long delayed.

    Security
    Mr. Jesselasked the Secretary of State for Northern Ireland if he will make a statement on security in Northern Ireland.
    Mr. Merlyn Rees: The police and the Army continue to deal firmly and effectively with security incidents in Northern Ireland and to bring criminals from both sides of the community before the courts. So far this year, 33 persons have been charged with murder, 11 with attempted murder and 64 for firearms offences. In the same period, 85 persons have been
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    killed as a result of terrorism. There have been more explosions than in the same period last year, but over 4·7 tons of explosives have been found by the security forces. Co-operation with the Irish security forces is good, and I particularly welcome the recovery by them also of substantial amounts of explosives, including the reported find of 4 tons of explosives in County Offaly on 13th March.
    Mr. Jessel: As 85 per cent. of the weapons found in the possession of the IRA are of United States origin, what have the Government done in the last four weeks since I raised the matter with the Foreign Secretary to help the leaders of the Irish-American community become fully aware that American funds raised for so-called social welfare in Northern Ireland are being largely used to buy weapons which are used by Irishmen to kill other Irishmen?
    Mr. Rees: My right hon. Friend the Prime Minister appeared on television in the United States on this matter. My right hon. Friend the Foreign Secretary has also played his part. My right hon. Friend the Minister of State, while in the United States recently, made this very point in a number of major cities there. The Prime Minister of the Republic, the Taoiseach, if I have read the newspaper reports this morning correctly, also dealt with this point in his joint address to Congress in Washington. A great deal is being done.
    In terms of what I was saying earlier about Irish attitudes, I tell the hon. Gentleman that he should sample the views of Irishmen or people of Irish extraction in many parts of the world. It is not enough to talk as we all do. What matters is physically to stop the stuff coming into the Province. A great deal is being done in that respect.
    Mr. Neave: With regard to the Government's recent talks with the Taoiseach, will the right hon. Gentleman give an undertaking to the House that no further talks will take place with political wings of para-military organisations? Does he realise that such talks only undermine civilian morale and raise false hopes for the future? Finally, what is the present position concerning the ceasefire?
    Mr. Rees: It was not our ceasefire: it was an expression by the Provisional

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    IRA. Following it, there has been a change in the nature of violence, according to the available figures. I repeat that my officials will talk, not negotiate, with legal organisations. But I think that to make clear at times the views of this House and the people in this country will do no harm. If anybody believed a year ago that negotiations and agreements were taking place, I hope that by now it is realised that that was not the case. It has been practically shown not to be the case.
    Mr. Goodhart: Is the Secretary of State aware that some of those who have carried the highest responsibility for security in Northern Ireland now believe that each battalion of the Ulster Defence Regiment should have a Regular company on full-time duty?
    Mr. Rees: This is a matter that is constantly being looked at. I have no doubt that there are differing views about it. I advise the hon. Gentleman to look at the view expressed by the previous Administration on this matter. It is not as simple as it looks. I shall certainly look at it, and in particular in relation to the border, because it is on the border that an important job of checking has to be done.
    Dr. David James: Now that internment has—in my view rightly—been ended, will the Secretary of State instruct the Director of Public Prosecutions to make more use of Acts such as those against incitement, treason, and so on, to ensure that undesirables are put behind bars for determinate periods?
    Mr. Rees: I have no power to instruct the DPP in Northern Ireland or anywhere else in what he shall do. The police and the DPP know what their duties are, and it is absolutely correct that I should play no part in it.
    Mr. Fitt: In relation to the overall security situation in Northern Ireland, will my right hon. Friend make it very clear that there are two sets of extremists or men of violence in Northern Ireland at the moment, and that the murders to which he has referred involved Catholics in the majority of instances, who certainly were not murdered by the IRA or any Republican organisation? Will he also make it clear that murderers and bombers
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    are not restricted to any particular section of the community in Northern Ireland? Finally, will he accept that the explosion last night in County Tyrone was certainly not the work of the IRA?
    Mr. Rees: The hon. Member always makes this point, and he is right to remind us that there are two groups of criminals in Northern Ireland operating under a political label. He is absolutely right that in the area he has mentioned, and over towards Armagh, members of his community have suffered. He is always the first to point it out and to sympathise when it happens on the other side.
    I agree that we have two groups to deal with and that there is only one way to deal with them—to have them charged and properly sentenced by the courts. In this way there is no feed-back from the various communities—people telephoning my office about their families—such as there was when I used to lock people up. It is now done through the courts, and this is the proper way.
    Mr. Kilfedder: After the particularly gruesome murders in South Armagh, including the murder of 10 workmen at Bessbrook, the Prime Minister personally said that it had been decided to send the SAS to Northern Ireland. Is the SAS still there, and has it or any other body arrested the people responsible for those murders?
    Mr. Rees: I do not think that I ought to tell the hon. Gentleman about the activities of the SAS. I am very content with what it is doing in that area. I think that the hon. Gentleman will agree on reflection that to talk about it would be rather a silly thing to do.
    Rev. Ian Paisley: Will the right hon. Gentleman take it from me that the Unionists of Northern Ireland welcome the forthright condemnation by the Prime Minister of the Irish Republic before Congress in the United States of America of the supplying of money to Northern Ireland for arms? Will the right hon. Gentleman tell us what points his officials deal with when they meet Provisional Sinn Fein?
    Mr. Rees: Everything that I say in the House of Commons, as reported in Hansard—nothing more and nothing less.

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    I am glad that the hon. Gentleman is pleased at what the Taoiseach said. I should have been happier had the hon. Gentleman come out against the words last week of a Mr. Ernest Baird, who criticised the honesty, integrity and ability of the British Army. I found them distasteful.

    Agriculture
    Mr. Farrasked the Secretary of State for Northern Ireland what effect the White Paper Command Paper No. 6393 on Public Expenditure will have on the special position of agriculture in Northern Ireland.
    Mr. Merlyn Rees: Agriculture accounts for 10 per cent. of employment in Northern Ireland compared with 3 per cent. in the rest of the United Kingdom. The public expenditure provisions recognise this by allowing for certain special aids to Northern Ireland agriculture as well as the assistance available to agriculture throughout the United Kingdom.
    Mr. Farr: Although I thank the right hon. Gentleman for that reply, may I remind him that these special aids are due to decline in value by 1980? If it is felt in this period that the decline of about one third in total is too rapid, will the right hon. Gentleman revise the projected figures?
    Mr. Rees: I think that the hon. Gentleman is referring to the remoteness grant and the financial assistance towards the cost of sea transport of Northern Irish eggs and the feed price allowance scheme. These are extra to what farmers receive here. I shall keep my eye on them, because they are important.
    Mr. Wm. Ross: Will the special arrangements for beef premiums continue in the coming year?
    Mr. Rees: Yes.

    RUC (Weapons and Equipment)
    Mr. Carsonasked the Secretary of State for Northern Ireland whether he is satisfied with the standard of weapons and equipment supplied to the RUC in their fight against the terrorists.
    Mr. Moyle: The assessment of RUC operational needs for weapons and other equipment is a matter for the Chief Constable
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    and the Police Authority. I am satisfied that adequate arrangements exist for the provision of all necessary equipment.
    Mr. Carson: Does the Secretary agree that if, in his own words, the RUC gradually takes over security in Northern Ireland, it will require weapons equivalent to those of the British Army? Is the hon. Gentleman also aware that the vehicles that are being used in the RUC are classed as suicide vehicles in Northern Ireland? Will the Minister ensure that the RUC gets the proper weapons, training and vehicles to fight terrorists and to take over full security in Northern Ireland?
    Mr. Moyle: It is not for me to ensure anything. It is for the Chief Constable of the Royal Ulster Constabulary to make out a case for any equipment he wants to the Police Authority and it is for the Police Authority to agree with him.
    The whole subject of the RUC's equipment with vehicles is being looked at by one of Her Majesty's Inspectors of constabulary. Already 100 vehicles have been received on account and the balance is under consideration. There is a working party on weapons and equipment and there are technical advisors to help the Chief Constable make out his case, and therefore he is in a full position to do so.
    Mr. Neave: Will the Minister tell us a little more about the working party on Army and RUC co-operation? When is it likely to report and when are we likely to be told something about it? Many of us are concerned about the need for co-ordination.
    Mr. Moyle: The hon. Gentleman's question lies outside the original Question. I was not referring to a working party on the co-ordination of the Army and the police. I was talking about a working party which advises the Chief Constable about the equipment for the RUC and which includes representatives of the Police Federation.

    Criminal Injuries (Compensation)
    Mr. Townsendasked the Secretary of State for Northern Ireland if he is satisfied with the basis for compensation awards granted under the Criminal Injuries to Persons (Compensation) Act

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    (Northern Ireland) 1968; and whether the working party set up to review the operation of the Act is ready to report.
    The Under-Secretary of State for Northern Ireland (Mr. J. D. Concannon): Everyone must have sympathy with the victims of violence and especially those who are injured in the execution of their duties in upholding law and order and wish to see the payment of appropirate compensation, but we cannot be unmindful of the cost to public funds.
    The working party which my right hon. Friend the Secretary of State set up to review the present legislation on personal injuries compensation has now reached an advanced stage. Northern Ireland Office officials are in close consultation with those engaged on the review of the corresponding ex gratia scheme in Great Britain, following which we look forward to receiving a report.
    Mr. Townsend: Does the Minister recall that I asked a similar Question over a year ago and received a similarly unsatisfactory Answer? Does he not feel that British Service men serving in Northern Ireland and their dependants have every reason to feel aggrieved that this report has been tossed about the trays of Whitehall for over a year? Has that not now become a scandal?
    Mr. Concannon: I do not think that what the hon. Gentleman has said is true. No one wants this report out as quickly as possible more than I do. The members of the security forces and their dependants have the benefit of Service pensions, which specifically cover the risk of injury or death. Under the Act, at present these have to be taken into consideration.
    Mr. Fitt: Will the Minister give the House some idea of what the total cost of claims has been? How many claims have been initiated since 1968 and how many of them relate to property, injured civilians, or those who have been killed?
    Mr. Concannon: There have been 25,896 claims. The sum involved in personal claims which have now been paid is £20 million and about another £15 million is outstanding. As regards property, the sum is now £141 million with £48 million outstanding. The total is nearly £224 million.
    Mr. Nelson: Is the Minister aware that many of my constituents feel deeply outraged that less than £6,000 should be paid in compensation to the widow and small daughter of a British corporal who was killed when fighting in Northern Ireland whereas up to £16,000 was paid in compensation to an IRA detainee who suffered during interrogation? When will he ensure that justice is done under the Compensation Act?
    Mr. Concannon: There are two different methods of dealing with the situation. That is one of the reasons why my right hon. Friend set up the working party. Of course, I am just as much aggrieved about events like this as anyone else. Not only the hon. Gentleman's constituents but mine are involved.
    Mr. Biggs-Davison: Is the Minister aware that it is not enough for him to say that this important report is at an advanced stage? As there has been a delay of over a year, will the hon. Gentleman please tell us an approximate date or a date beyond which this delay will not be allowed to continue?
    Mr. Concannon: The matter has not been delayed. An extremely difficult situation is being discussed. The matter is at a very advanced stage. The working party has to report to my right hon. Friend and once that report is in the hands of my right hon. Friend, it will be dealt with.

    Employment Prosp ects
    Mr. Michael McNair-Wilsonasked the Secretary of State for Northern Ireland if he will make a statement about employment prospects in the Province.
    Mr. Orme: A precise forecast of employment prospects is not possible; in Northern Ireland they will depend to a considerable degree upon an upturn nationally. The extent to which Northern Irelands participates in the upturn will be heavily influenced by the political stability of the Province until then and at that time. We need to be sure that we are making the best use of the resources available.
    Indeed, as my right hon. Friend has already said in reply to an earlier Question, the economic strategy for Northern Ireland for the next few years needs to be re-assessed. This will now

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    be done. The Northern Ireland Economic Council will be consulted, and constructive views from any quarter, including the CBI and the Northern Ireland Committee of the Irish Congress of Trades Unions, will be welcome.
    Mr. McNair-Wilson: Does the Minister agree that Harland and Wolff is of overriding importance in the overall economy of Northern Ireland? Is it not a fact that two of the three tankers originally ordered by Maritime Fruit Carriers have found a purchaser in Coastal States Gas of Houston, Texas? What will happen to the third tanker? As the company is now nationalised, will any warships be ordered from it, or will it become a repair base for our Navy?
    Mr. Orme: I confirm that the orders for the two tankers have been saved. I should not like to comment on the third order at this stage. The hon. Gentleman is aware that the Government have put a considerable amount of public money into what is now a publicly owned company to try to preserve employment in Harland and Wolff. Every prospect for employment is being examined.
    Mr. Bradford: Is the Minister satisfied that every facet of the social and economic realities of Northern Ireland was considered before the decision to denude the Province of 2,000 jobs in the defence sector was taken?
    Mr. Orme: I was in Northern Ireland yesterday when the Defence Ministers announced their decisions. The previous defence cuts did not affect Northern Ireland at the time. This is a Government decision to reduce manpower. We are being called upon to reduce public expenditure. It is unfortunate that when it takes place, as in this case, jobs are lost. As part of the reassessment, we hope to re-examine how we can create new jobs on a more permanent basis than that of defence.

    Reports
    Mr. Molyneauxasked the Secretary of State for Northern Ireland if he will consider laying before the House at regular intervals reports on the progress of operations against the IRA and other terrorist organisations in Northern Ireland.
    Mr. Merlyn Rees: A report "Statistics on Security" is produced quarterly, providing a wide range of statistical material about the extent of terrorist violence and the operations of the security forces. Copies of these reports are placed in the Library. I also keep the House fully informed about the Government's security policy.
    Mr. Molyneaux: Does the Secretary of State agree that, instead of appearing to react to terrorist acts, it would be better to institute a system of detailed reporting, either to this House or perhaps to another form of parliamentary forum?
    Mr. Rees: All such information is contained in the report which I have with me and a copy of which was placed in the Library on 8th March. It contains details of the number of incidents, explosions, bombs and devices neutralised, the number of houses searched, the amount of explosives recovered, and the number of people served with various orders. The information is there. I asked for it to be placed in the Library some time ago because the report is far better able to tell what is happening in Northern Ireland than piecemeal Answers to Questions in the House.
    Mr. Powell: In view of the right hon. Gentleman's responsibility in this House, would it not be more appropriate for these reports now to be raised to the dignity of Command Papers?
    Mr. Rees: I will consider that suggestion, because I agree that what matters is that a wide variety of people should have the chance to see this information. It is the information which I study daily with my security advisers. It tells a different story from the situation indicated by some unusual occurrence.

    Foyle Fisheries
    Mr. Wm. Rossasked the Secretary of State for Northern Ireland what action he intends to take following the publication recently of the report on the Foyle Fisheries.
    Mr. Moyle: The report was made to the Foyle Fisheries Commission, not to Ministers. I understand that the Commission has requested the views of the Foyle Area Advisory Council and other interested parties, and when these have been received it will make proposals for

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    the future management of the Foyle Fisheries. If required these will be discussed between the Commission, the Department of Agriculture and Fisheries in Dublin and the Northern Ireland Department of Agriculture and any necessary action will be taken.
    Mr. Ross: I thank the Minister for that Answer. Is he aware that this report confirms allegations by anglers over a long period about overnetting on the Foyle system? Will the Minister undertake to ask the Foyle Fisheries Commission to have the widest possible consultation with all interests in the Foyle area about both rod and net fishing and water rights, and that the farming interests will be included in those consultations? This is a very big problem for the community at large.
    Mr. Moyle: I agree that it is a big problem for the community at large. The inquiry was set up for the reasons the hon. Member stated, and I can give the undertaking that there will be the widest possible consultations with all the local interests before action is taken.

    Political Leaders
    Mr. Goodhartasked the Secretary of State for Northern Ireland what discussions he has had with political leaders in Northern Ireland since the Convention last met.
    Mr. Merlyn Rees: I have not had any formal discussions with party leaders in Northern Ireland since the dissolution of the Convention. I have on normal House of Commons terms spoken informally with Northern Ireland Members at Westminster.
    Mr. Goodhart: What plans does the Secretary of State have for regular meetings with the leaders of the political parties which were represented in the Convention but which are now unrepresented in this House?
    Mr. Rees: I have no plans for doing that on a regular basis. As I stated earlier, the leaders of the UUUC, the SDLP and the VUP sit in this House. There is little problem about talking with people in Northern Ireland, but I do not think that formal talks on the basis of those conducted in the last four or five years are necessary at the moment.
    Mr. McNamara: Is my right hon. Friend aware that I am resisting the temptation to ask how the talks are progressing that he and his Minister of State are conducting with various bodies? Will he say to what extent the Department is making arrangements for regular consultations with community leaders in Northern Ireland who may not be Members of this House, who may have important matters to discuss, but who feel that because of the diminution of the responsibilities of local government in Northern Ireland, they have no proper opportunity to discuss them?
    Mr. Rees: I am prepared to do that, but in no circumstances will I diminish the responsibilities of Westminster Members and my responsibilities to this House. A large number of people in Northern Ireland see the Ministers who work with me and who spend a great deal of time there. We are not deficient in knowledge of the views of a wide variety of people in the Province.

    Local Government
    Mr. Kilfedderasked the Secretary of State for Northern Ireland what plans he has to restore democracy to local government in Northern Ireland.
    Mr. Concannon: District councils in Northern Ireland are democratically-elected bodies and we have no plans for changing the present system of local government.
    Mr. Kilfedder: Since Northern Ireland is under-represented in this House and since about half the members of the area education and health boards are nominated by the responsible Ministers and are not elected by the people, does not this situation include all the ingredients for a bureaucratic and insensitive approach to local problems? As—
    Mr. Speaker: Order. I suggested earlier that if the hon. Gentleman got to the point of his Question, we should get on more quickly.
    Mr. Kilfedder: Thank you, Mr. Speaker. May I ask briefly, therefore, whether the Minister realises that a fully-elected third tier system for local government is urgently needed in Northern Ireland?
    Mr. Concannon: A substantial proportion of the membership of area boards is already drawn from district councils even though the services provided are financed entirely by the Government.

  PRIME MINISTER (VISITS)
  Mr. Rifkindasked the Prime Minister whether he will pay an official visit to Maputo.
  The Prime Minister (Mr. Harold Wilson): I have at present no plans to do so, Sir.
  Mr. Rifkind: Does the Prime Minister realise that he will now have plenty of time to accept all the invitations he receives to visit exotic world capitals?
  Does he accept that, it would be intolerable for Britain to enter into any financial commitment with the Mozambique Government without a clear and unambiguous guarantee from that Government that they will not approve, condone, or permit armed intervention from Mozambique into what is still British territory?
  The Prime Minister: Questions about future visits clearly refer to my visits as Prime Minister. Otherwise, this Question would, I suspect, be out of order.
  I hope that the hon. Member is not suggesting that we should go back on the unanimous agreement of the Commonwealth Prime Ministers' Conference, which I reported to the House at the time, and on the view now being taken by the Security Council. We have made clear our opposition to the settlement of the Rhodesian dispute by terrorism or bloodshed, but we are certainly prepared, as we agreed at the Commonwealth Conference, and as is now the wish of the Security Council, that we should make a contribution to Mozambique in respect of its financial losses through honouring the United Nations sanctions agreed on the initiative of the then Labour Government.
  Mr. Ford: Is my right hon. Friend aware that some of us are sorry that he will not be visiting Southern Africa in the near future? Will he speak to some of his friends in charge of the Southern Africa Solidarity Fund to ensure that its resources are devoted to helping
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  oppressed people in this area wherever they are?
  The Prime Minister: Yes, that has always been my view.
  Mr. Eldon Griffiths: Does the Prime Minister agree that the situation in Southern and Central Africa is now extremely dangerous and that great care will be needed to prevent minor clashes on the Rhodesian border from escalating into a full-scale guerrilla war? Will he take steps to improve urgently, as far as he is able, the channels of communication between this country and both black and white leaders in Rhodesia? In particular, will he accept that there is one thing upon which Mr. Smith, Mr. Nkomo, President Kaunda and Mr. Vorster are now agreed—that they want a British presence to back them up? Is the—
  Mr. Speaker: Order. That is long enough.
  The Prime Minister: I recognise that the hon. Gentleman has been trying to help in this matter and I understand that he has spent some time in the last few days in these areas. I have no doubt that because of his sincerity in this matter, which I acknowledge, he will put at the disposal of my right hon. Friend the Foreign Secretary all the information he has gleaned during his visit. We naturally get our own direct reports of the views of some of the leaders whom he has mentioned, but my right hon. Friend will be grateful for anything that the hon. Member is able to tell him.
  Mr. Lee: Is not the time fast approaching when my right hon. Friend might go to President Maputo with a view to getting access to Rhodesia? Is it not time for us to take the initiative in this matter and to set about establishing a lawful Government in Rhodesia for the first time since 1965?
  The Prime Minister: I do not believe that it would be the view of either side of the House that we should intervene in a military sense, certainly not, as my right hon. Friend the Foreign Secretary has made clear, to support a white minority in opposition to majority rule, when on the suggestion of successive Governments, going back to the time of Sir Alec Douglas-Home, the Rhodesians have

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  had every chance to negotiate a satisfactory settlement. There will be no question of any intervention. If we have any rôle to play in discussions we shall be ready to consider the matter. In my view it must be something that looks like succeeding and not be a reason for further manoeuvring to postpone a settlement.
  Mrs. Thatcher: Does the Prime Minister accept that the Mozambique Government are either conniving at or fomenting terrorism against black and white Rhodesians across the frontier? Will he also accept that, quite apart from the illegal régime in Rhodesia, we and not the Commonwealth have the ultimate responsibility for Rhodesia? Therefore, is he aware that many Conservative Members believe that it is quite wrong to give aid to Mozambique in those circumstances?
  The Prime Minister: I do not accept the right hon. Lady's views about fomenting. Mozambique has shown great patience and tolerance, because throughout this period it has not invoked the sanctions for which the Security Council has called. We proposed and invoked them when the Conservative Party was split three ways. Will the right hon. Lady say whether she supports the United Nations sanctions? Does the Conservative Party support the sanctions? [Interruption.] I can understand the nervousness of Conservative Members. Last May the right hon. Lady was told in the House about the Commonwealth agreement on financial assistance if sanctions were reimposed. Does she support that? She did not oppose it at the time.
  As for outside intervention, as the House will know I called in the Soviet Ambassador immediately on his return from Moscow and warned him strongly against intervention in that part of Africa, as well as in other parts.
  Mr. Thorpe: For the avoidance of doubt and as the right hon. Lady the Leader of the Opposition has alleged that Mozambique has fomented terrorism, will the Prime Minister take steps to find out whether she includes President Kaunda of Zambia within the ambit of her condemnation?
  The Prime Minister: I did not think she did. It is a matter for her if she did. I was interested in what the hon. Member for Bury St. Edmunds (Mr. Griffiths) said after having met President Kaunda and others. We shall be very interested to study what he found there.
  Mr. Skinnerasked the Prime Minister if he has any plans to visit Oxford.
  The Prime Minister: I have at present no plans to do so, Sir.
  Mr. Skinner: Is my right hon. Friend aware that when I tabled this Question about a fortnight ago I had something else on my mind? As that has been overtaken by events, will he take a trip to Oxford in the few days remaining and consult the Oxford-based British Leyland workers about their new three-day week chairman—the £22,500 a week chairman?
  Mr. Russell Kerr: £22,500 a year.
  Mr. Skinner: I must not exaggerate.
  Mr. Nicholas Winterton: That will be a change.
  Mr. Skinner: Will my right hon. Friend look at the possibility of having a snap election there to replace that chairman so that the workers can make the choice this time?
  The Prime Minister: I am grateful to my hon. Friend. If I do visit Oxford it will be to see the twins, not to go to Cowley.
  It is not for me or even my successor to go round the country to find out what people in particular factories think about these matters. There has been a great improvement in the British Leyland situation recently in terms of productivity and in its approach to viability. However, I would rely on the elected trade union representatives in these matters. As I have explained to the House, Sir Richard Dobson was appointed by the British Leyland Board in consultation with the National Enterprise Board, and we do not interfere in these matters. However, when this appointment was put to the Government, they approved it.
  Mr. Alexander Fletcher: Does the Prime Minister recollect that in 1964 the present Foreign Secretary attended a crash course in economics at Oxford

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  University? Does the right hon. Gentleman have any plans to arrange a similar course for his right hon. Friend in the next few weeks?
  The Prime Minister: At that time my right hon. Friend was a Visiting Fellow of Nuffield College, as a number of distinguished right hon. and hon. Members of all parties have been. However, in view of the great disappointments—and I hope not to go finally to resignation without receiving an answer to my repeated question—I should like to arrange for similar facilities to those described by the hon. Gentleman to be provided for Opposition Front Bench spokesmen.
  Mr. Luard: If my right hon. Friend should find himself with some time on his hands in the weeks to come, will he accept that he would be extremely welcome to visit my constituency, which is already quite well known to him? Does he appreciate that there are other things to visit than the University colleges, other even than grandchildren? Will he take the opportunity to go to Cowley to see for himself the dramatic improvement in industrial relations which has taken place over the last few years and to offer his congratulations to the workers and management of British Leyland at Cowley?
  The Prime Minister: We have received very full reports not only about the Cowley factory but about other factories. I am informed that in the six or seven years prior to the change in ownership of British Leyland there were only four days on which there were no disputes. The great improvement in industrial relations there is remarkable. I understand that last month for the first time the factory was able to fulfil its production programme and even to exceed it.

  EUROPEAN COMMUNITY (HEADS OF GOVERNMENT)
  Mr. Luceasked the Prime Minister whether he will raise the problems of Southern Africa at the forthcoming meeting of the EEC Heads of State.
  The Prime Minister: It is not the practice to publish an agenda for European Council meetings or to specify in detail what subjects will be raised, Sir.
  Mr. Luce: As one of his final gestures, will the Prime Minister, in concert with the Community Heads of State, make it absolutely plain now to Mr. Nkomo and to Mr. Smith that if only they will reach agreement at this late hour, Britain, with the support of the West and the Community, will stand ready to give every possible assistance to the Europeans and Africans in Rhodesia to facilitate a peaceful transition to independence?
  The Prime Minister: My right hon. Friend the Foreign Secretary has made this clear on a number of occasions. We want to give whatever assistance is possible to this end, but it must be a realistic settlement capable of sticking. There could have been one 10 years ago. On many occasions Mr. Smith put forward proposals which, if he had not resiled from them, could have led to a peaceful settlement.
  The European Council is a relatively new invention—I think, an extremely good and successful one. These matters do not normally come up on the agenda but, as the hon. Gentleman may be aware, it often happens that in what is called the "fringe of conference"—dinners, lunches and late night meetings—we discuss world affairs. Last year the European Council discussed the Helsinki Conference and the problems of Spain and Portugal.
  Mr. Frank Allaun: Will the Prime Minister urge the EEC to join our embargo on arms for South Africa? Secondly, is he aware that Centurion parts, spares and equipment have been supplied by Aviation (Jersey) Ltd, whose manager this morning told the South African Press that there was no reservation placed on such supplies by Her Majesty's Government?
  The Prime Minister: We have already pressed our colleagues in every forum to support the line that we took on arms for South Africa when we came into office in 1964, and again in 1974. We have always pressed for full support for the sanctions policy. It was French oil in the period of President de Gaulle which frustrated the sanctions and which kept the white Rhodesian régime afloat.
  With regard to the situation in the Channel Islands, I cannot anticipate any possible criminal proceedings. The responsibility in these matters is that of

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  the local Government there. I understand that their laws are very similar to ours in the matter of sanctions on Rhodesia and the supply of arms to these areas. We must wait to see whether there will be prosecutions in their courts.
  Mr. Marten: As the United Kingdom has been enforcing sanctions against Rhodesia and as some of the biggest sanction busters on Rhodesia are in fact our major partners in the Common Market, is it right that we should make this contribution to Mozambique while at the same time the big sanction busters, our partners in the Common Market, are not contributing to Mozambique, because one of the essences of the Common Market is that there should be fair competition?
  The Prime Minister: I have referred—not now, but in past years—to the rôle of France in sanctions busting; otherwise, I think that the oil sanction would have been effective. If the hon. Gentleman has any evidence about sanctions busting by any country, no doubt my right hon. Friend the Foreign and Commonwealth Secretary would be very glad to receive it from him. However, on the other issues raised here, I do not think that this is really a matter for the EEC Heads of Government, because giving help to Mozambique was a unanimous decision of the Commonwealth Conference. I have never known the hon. Gentleman—however much he may have been criticised from his own side—to be backward in supporting the Commonwealth and its decisions.

BUSINESS OF THE HOUSE
Mrs. Thatcher: May I ask the Leader of the House to state the business for next week?
The Lord President of the Council and Leader of the House of Commons (Mr. Edward Short): The business for next week will be as follows:
MONDAY 22ND MARCH—Supply [13th Allotted Day]: Until about 7 o'clock, debate on a motion on the impact of personal taxation.
Afterwards, a debate on the defence cuts in their application to Northern Ireland, on a motion for the Adjournment of the House.
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Consideration of Lords Amendments to the Prevention of Terrorism (Temporary Provisions) Bill.
TUESDAY 23RD MARCH—Second Reading of the New Towns (Amendment) Bill.
Motion on the Property Services Agency Order.
Consideration of any Lords Amendments which may be received to the Water Charges Bill.
WEDNESDAY 24TH MARCH—Supply [14th Allotted Day]: A debate on international trade, on a motion for the Adjournment of the House.
At 7 o'clock, the Chairman of Ways and Means has named opposed Private Business for consideration.
Motion on financial assistance to Industry (BP Chemicals International Limited).
THURSDAY 25TH MARCH—Second Reading of the Weights and Measures &c. Bill, when EEC Document R/3070/75 will also be relevant.
Motions on Orders relating to the coal industry.
FRIDAY 26TH MARCH—Private Members' motions.
MONDAY 29TH MARCH—Debate on the Green Paper on direct elections to the European Assembly, Command No. 6399.
Mrs. Thatcher: I should be grateful if the Lord President would make it clear that the Supply Day on Monday was made available to the Liberal Party and the Ulster Unionists for them to choose the subject for debate.
Secondly, when does the Lord President intend to arrange a debate on the important Commission documents which are outstanding? I have in mind particularly the debate on skimmed milk, which was abandoned, and the debate on lead pollution, which has been adjourned.
Mr. Short: I have promised debates on both these subjects. We shall arrange debates as soon as possible. Certainly I confirm what the right hon. Lady has said—that Monday is a Supply Day that has been made available by the official Opposition to the Ulster Unionists and the Liberal Party.
Mr. Ashley: Does my right hon. Friend agree that the time has now come to establish a British Bill of Rights? As we now adhere to the European Convention on Human Rights, will he arrange for a debate on those rights which are guaranteed in Europe by virtue of our adherence?
Mr. Short: I cannot promise any time next week or in the near future for a debate on this matter, but it would be a very suitable subject for a Private Members' day or a Supply Day.
Mr. Lawson: In view of the outstanding success of last week's two-day debate on the public expenditure White Paper, will the Leader of the House give an assurance that this will be repeated next year?
Mr. Short: I am concerned now with next week, not next year.
Mr. Jay: As my right hon. Friend has promised a debate on the skimmed milk powder Order, will he assure the House that these damaging proposals will not be put into operation until this House has reached a decision?
Mr. Short: Perhaps I could make the position on this matter quite clear, because I think that in one small respect I did, perhaps, mislead the House last week. There are two Orders. The first is about skimmed milk. In the case of that Order, the opinion of the European Assembly was not required, and the Regulation has been adopted. In consequence, it is now Community law, as I said, and as such it is applicable in the United Kingdom. It is perfectly straightforward.
The second proposal is rather different. Here consultation with the European Assembly was required. I think that the misleading factor in all this has been a Press notice, which was prepared on the basis that the Assembly was expected to give its opinion in time for the Council to adopt the measure formally and for it to come into operation on 1st April. In the event, the Assembly was unable to reach a conclusion on 10th March, so that that timetable clearly could not be met. For that reason, we have not made any arrangements to implement this particular measure.
It is therefore not true to say that the Council or my right hon. Friend have acted without proper authority. The
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necessary authority has been obtained on the first proposal, as I have said, in accordance with the proper procedure, and no action whatever has been taken on the second proposal. That is held up pending receipt of the Assembly's opinion and formal adoption by the Council. I hope that that makes clear the slip that I made last week.
Mr. John Page: Will the Lord President say when he expects to be able to arrange a debate on the important matter of the ratification of the European Patent Convention?
Mr. Short: No, Sir, I cannot. The hon. Gentleman has raised this matter with me previously. I shall certainly keep him informed about it and see what I can do about it. However, I think that it will not be for some time to come.
Mr. Spearing: My right hon. Friend has mentioned the debate on Monday week on the Green Paper on direct elections. However, is it not a fact that when the Heads of Government next meet they will have before them a draft convention on direct elections? Would it not, therefore, be appropriate for the House to have that document before it, and will my right hon. Friend now assure us that it will be available on Monday week?
Mr. Short: The document that will be available will be the Government's Green Paper, but as regards the Heads of State discussions, I am afraid that my hon. Friend must put down a Question to the Prime Minister about that.
Mrs. Kellett-Bowman: When will the right hon. Gentleman honour his promise to deal with the question of public lending right?
Mr. Short: I am very glad to tell the hon. Lady that that Bill is being introduced in another place today.
Mrs. Dunwoody: Is my right hon. Friend aware that the European Assembly met and considered the Martens Report, which has a direct relationship to the skimmed milk problem, on Friday last week, and, myself voting against, accepted the Report in its entirety? Am I to take it that the new inclusion in the weights and measures debate of an EEC document is at last a recognition of the fact that this House is not being

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given sufficient time to discuss EEC Directives before they are accepted—and accepted without our having had the chance to debate them?
Hon. Members: Hear, hear.
Mr. Short: I do not know why my hon. Friends are shouting "Hear Hear" to that. With one exception—where there was no time to do so—I have honoured the promise that I made at the beginning of this Parliament, almost two years ago, that we should discuss these matters before they came up for decision in Europe.
Mr. Grylls: When will the Leader of the House allow time for a debate on the National Enterprise Board guidelines, bearing in mind that the Secretary of State for Industry has promised such a debate and that this is a very urgent matter that the House wants to talk about?
Mr. Short: I did not know that my right hon. Friend had promised a debate in terms, but certainly if there is a general desire for a debate on this matter, it could be arranged through the usual channels.
Mr. Loyden: In view of last week's events in relation to the public expenditure White Paper, what is the constitutional situation regarding that White Paper?
Mr. Short: I am answering questions on next week's business. However important this matter may be, it does not arise out of my statement on next week's business.
Mr. Ian Lloyd: Should the business of the House next week again come to depend on the production of Xerox copies of the Order Paper, will the Leader of the House assure hon. Members on both sides that the practice, which has taken place, of an obsolete number of Order Papers being printed and then pulped by the Stationery Office—a grotesque waste of public money—will not be continued?
Mr. Short: I will look into that matter. I think that we owe a great debt of gratitude to the people who provided us with essential parliamentary papers last week. I should like to express our
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gratitude to them. I hope that all hon. Members will put up with some inconvenience. As I have said on many occasions, I am not prepared to have Parliament brought to a standstill by any kind of industrial action.
Mr. Spriggs: May I ask my right hon. Friend——
Mr. Speaker: Order. Those hon. Members who remain on their feet as a reminder to me are only delaying the time when they will be called.
Mr. Spriggs: May I ask my right hon. Friend whether he has the information available for the rising of the House for the Easter Recess? Can he yet give the date for the Easter Recess and the return of Members afterwards?
Mr. Short: I cannot give the date today. It depends on the progress of business. I hope that we shall be able to rise for the Easter Recess. I will let the House know the date as soon as possible.
Mr. Peyton: I should like to echo the thanks expressed by the Leader of the House to those who gave us at least some kind of Order Papers last week. I also applaud his repeated determination to see that Parliament continues its work, despite these hiccupping interruptions. I hope that at some time we might have a reasonably calm discussion on what should be done to ensure that we do not have these undignified interruptions of parliamentary procedure.
Mr. Short: We can talk about this matter. These things do occur from time to time. I should point out that what occurred last week was an unofficial dispute.
Mr. Cryer: Does my right hon. Friend accept that, after repeated requests by Back Benchers on this side of the House, the fact that the Yorkshire and Humber-side Region was debated in the Regional Affairs Committee was welcomed? However, does he further accept that it is no substitute for a debate on the Floor of the House? For example, the time in Committee was not adequate to deal with the textile industry and with imports, which are severely damaging. Will my right hon. Friend promise an early debate on the Floor of the House on the Yorkshire and Humberside Region?
Mr. Short: I cannot promise an early debate on the Floor of the House, Representations were made to me by a number of hon. Members about the debate in Committee. I understand that so many hon. Members wished to speak that the time was inadequate. I shall be happy to arrange another session for that debate in the week after next if that commends itself to hon. Members from that area.
Dr. Hampson: Have the Government lost interest in the Bullock Report? Last year the Lord President on three occasions promised to consider the prospects of a debate on that important Report. When are we to have it?
Mr. Short: The Government have not lost interest in the Bullock Report on Literacy. If an occasion arises, we shall debate it. Perhaps the hon. Gentleman, who is the Shadow spokesman on education, could persuade the Opposition to give some of their time to debate this important Report.
Mr. Gould: Has my right hon. Friend seen Early-Day Motion No. 279, signed by well over 100 Members on this side of the House, with the total rising each day, which calls on the Government not to proceed further in committing this country to direct elections to the European Assembly until a Select Committee has had a chance to consider and to report to the House on all the constitutional and practical implications? Does he agree that a one-day debate on a Green Paper, which does not raise the question of principle, is an inadequate basis for committing this country to direct elections at the Heads of Government meeting?
[That this House resolves to establish a Select Committee to consider the constitutional and practical implications of Article 138 of the Treaty of Rome, including any recommendation for direct elections to the European Assembly made by the Council of Ministers, and calls upon the Government not to proceed further in committing this country to proposals for representation in the Assembly until the House has considered the Committee's report.]
Mr. Short: The Green Paper does not commit this country to direct elections. That would require legislation approved
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by the House, ultimately, if it were so decided. I have announced a debate on Monday week on this matter. If it is desired, I could arrange for an extension of the time. If a further day is required, perhaps the Opposition would be prepared to consider the matter. Certainly the point made by my hon. Friend will be relevant in the debate on Monday week.
Mr. Geoffrey Finsberg: May I ask the right hon. Gentleman, not for the first time, when he expects to tell the House of the setting up of the Speaker's Conference on electoral reform?
Mr. Short: That is a question for my right hon. Friend the Home Secretary.
Mr. Buchan: On the earlier question relating to EEC Regulations, we received the grave answer that these had become law in this country without discussion. Surely the proper course is to have an early debate both on those Regulations and on the entire food price package which was negotiated in Brussels, again without discussion and debate in this House. Has this not now become an urgent matter?
Mr. Short: Certainly. I have promised further time to debate the matter if that is the wish of the House. I have tried to point out the significance of the two Orders. I have looked up the spring debates on Farm Price Reviews over the past 20 years and found that there have been five such debates in that time, all in Supply time. Perhaps the Opposition will bear that in mind for one of their days as well.
Mr. Lane: Reverting to the point made by my hon. Friend the Member for Hampstead (Mr. Finsberg), is the Leader of the House aware that there has already been too much delay and buck-passing about the Speaker's Conference? Will he undertake to speak to his right hon. Friend the Home Secretary with a view to some Government initiative being taken before Easter?
Mr. Short: I will discuss this matter with my right hon. Friend. I do not know about any buck-passing or delays. The normal practice for the Speaker's Conference is for the parties to try to reach agreement on the agenda. I

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imagine that that process is going on. If not, I will look into it.
Mr. Skinner: Regarding Common Market surpluses, would it not be more sensible to have a general debate on the Common Market mountains stretching from skimmed milk, on the one hand, to the mountains of coal in this country, on the other? Why is it that, for instance, we are constantly being urged to get rid of Continental surpluses, and yet, when it comes to getting rid of 35 million tons of coal in this country, most Continental countries buy their coal elsewhere?
Mr. Short: The second part of my hon. Friend's question does not arise out of the Business Statement. On the first part of his question, if he looked at the time that we have spent discussing European matters so far this Session, I think that he would be very surprised.
Mr. Marten: I support the hon. Member for Southampton, Test (Mr. Gould) in his request for a second day on the direct elections Green Paper. Knowing the enthusiasm of so many Federalists on this side of the House for direct elections, I am sure that any approach through the usual channels on this side would be met with one day, if not two days.
Mr. Short: I realise the importance of this matter and how deeply the hon. Gentleman feels about it. No doubt he will use his considerable influence with his Front Bench to see whether it will provide a day as well.
Mr. Canavan: Is there any truth in the report that a dummy Bill on devolution has already been drafted and printed? Bearing in mind the different climate of opinion in Scotland and Wales on the issue, will the Government consider introducing separate Bills for Scotland and Wales?
Mr. Short: On the first point, it is true that we have received a first print, but a number of prints are needed before a Bill is got right. Therefore, it will not see the light of day for some time.
On the second point, the right hon. Member for Penrith and The Border (Mr.
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Whitelaw) raised this matter with me in the debate and I promised to consider it.
Mr. Tim Renton: Is the Lord President aware that the Secretary of State for Energy has issued an election manifesto in which, among other things, he calls for import controls? In view of that, will the right hon. Gentleman arrange for his right hon. Friend the Secretary of State for Energy to speak in the debate on international trade next Wednesday in order that the House may hear how he holds views so divergent from the Government's and yet stays within the Cabinet?
Mr. Short: The hon. Gentleman asked, first, whether I was aware. The answer to that is "Yes, Sir". The answer to the second question is "No, Sir".
Mr. William Hamilton: Will my right hon. Friend reconsider that answer and ask all the candidates to speak on Wednesday? On a more serious matter, will he indicate why there is a singular lack of progress in setting up the Select Committee on Procedure?
Mr. Short: I regret that. As my hon. Friend knows—or perhaps he does not know, because he is away a good deal now—I have been discussing this matter with many hon. Members on both sides of the House. We have now agreed on the terms of reference, and I hope that the Committee will be set up in the very near future.
Mr. Michael Latham: Has the right hon. Gentleman noticed the gloomy fact that on Tuesday Standing Committee J is due to sit? Is there nothing he can do to stem the overwhelming flood of legislation?
Mr. Short: The legislation is slightly less than it was in one of the years of Conservative Government. But I agree with the hon. Gentleman that the situation on that score is pretty gloomy.
Mr. Arthur Lewis: Has my right hon. Friend's attention been drawn to the serious situation which may result following the notification of intending industrial action—if not a strike—by chairmen of nationalised boards? Will he have a word with the Ministers responsible for those appointments to see whether they will discuss the matter with the TUC———
Mr. Speaker: Order. We are dealing with next week's business.
Mr. Lewis: Yes, Mr. Speaker, I am well aware of that. I have been here just as long as you have—
Mr. Speaker: Order. I realise how long the hon. Member has been here, and I hope that he will come to the point.
Mr. Lewis: Will the Leader of the House consult with the Ministers responsible and ask them, in turn, to consult the TUC to lay down recommendations in regard to conditions, hours and wages which are adequate for the job of a chairman of a nationalised industry?
Mr. Short: We already have a salary review body dealing with the salaries of all chairmen of nationalised industries. No doubt the Government will consider this matter in due course.
Mr. Fairbairn: When will the House have an opportunity to debate the housing loan finance agency promised in the Labour Party manifesto?
Mr. Short: If the hon. and learned Gentleman will contain himself, he will find that eventually we shall work our way through all our manifesto promises. Out of 67 such matters, I think that we have already reached a total of 59. That is not a bad record.
Mr. Molloy: Will my right hon. Friend take full note of the growing concern felt by hon. Members in all parts of the House about the way in which EEC legislation seems to be slipping through the
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House in an unacceptable manner, and also about the important fact that debates on the great regions of our nation—with particular reference to Greater London, which is my own concern—cannot be debated on the Floor of the House? Will he fully appreciate that those two matters are causing genuine concern? Therefore, will he examine the situation and make a statement some time next week?
Mr. Short: My hon. Friend is right to talk about the difficulties caused, and I dealt with this matter in my speech during the recent debate on procedure. One factor that makes the situation so difficult in arranging regional or indeed general debates is the large amount of time which we must devote to European matters. This is a new matter for the House of Commons. I hope that the Committee dealing with the reform of Parliament will give a good deal of time to that point. My hon. Friend is right to express concern.
Mr. Ronald Bell: Will the right hon. Gentleman seek authority by bringing a Supplementary Estimate to Parliament before giving public money to a foreign Government for the harassment of British people in Africa?
Mr. Short: I recently heard my right hon. Friend the Prime Minister answer a Question on this matter. I confirm that if any loan or aid is given to Mozambique, it will be done in the correct parliamentary way and the proper procedures will be followed.

ORDERS OF THE DAY
  TRADE UNION AND LABOUR RELATIONS (AMENDMENT) BILL
  Lords Amendments considered.
  TRADE UNION AND LABOUR RELATIONS (AMENDMENT) BILL
    Clause 1

      REPEALS OF THE PRINCIPAL ACT
      Lords amendment: No. 1, in page 1, line 21, at end insert—
      "(2) In paragraph 6(5) of Schedule 1 to the principal Act there shall be inserted after the word 'objects' the following words:
      ' on grounds of sincerely held personal conscientious conviction not motivated by hope of financial gain or material advantage or'."
      3.55 p.m.
      The Secretary of State for Employment (Mr. Michael Foot): I beg to move, That this House doth disagree with the Lords in the said amendment.
      I hope that it will be convenient for me to deal with this matter briefly. Then, having heard the debate, I hope that I shall be permitted to reply.
      The House may have thought, as I did, when we discussed this Bill on a previous occasion that that would be the very last time that the measure would come before this House. I took that view because I felt that either the House of Lords would agree with the Bill as we returned it to that place on the last occasion or we would" proceed to place the Bill on the statute book under the provisions of the Parliament Act. However, neither eventuality has occurred and the Bill is back before us. The House of Lords did not decide to throw out the whole Bill but decided to limit to one small amendment the changes that it wished to make. It is an important amendment and it stands on its own. Therefore, the Bill has returned to the House of Commons in that way.
      If we again send the Bill to the House of Lords, my expectation and hope is that the House of Lords will then, at last, accept our decision. I hope that the Bill will become an Act of Parliament without our having to invoke the Parliament Act. That would be the most convenient procedure for all concerned, and I hope that that will occur.
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      Although this amendment which comes to us from the House of Lords is a minor one, I am not suggesting that it does not raise an important question. We have discussed on many occasions the so-called conscience clause. Our differences with the Opposition flow from no disrespect for the claims of conscience but from the fact that we do not believe that respect for conscience can be put in the statutory form sought for it by the Opposition. For that reason, we have on many previous occasions turned down proposals on this score.
      Lords Amendment No. 1, which was moved in another place by Lord Hailsham, seeks to add the words:
      "on grounds of sincerely held personal conscientious conviction not motivated by hope of financial gain or material advantage or…".
      The effect would be to make the dismissal of a person who refused to join a closed shop automatically unfair—that is to say, compensatable—if a tribunal found that he genuinely objected, on grounds of sincerely-held personal conscientious conviction, other than religious convictions, which are already covered, to being a member of any trade union whatsoever.
      We believe that if such a provision were written into the Bill it would be most obscure. It is a good deal more obscure than many of the other so-called conscience clauses proposed on previous occasions. It would set many difficult and awkward problems for the courts to decide, and nobody could be certain how they would decide them. The tribunals would have many difficult questions to determine. For example, they would have to determine whether a conviction was sincerely held, whether it was personal and whether it was conscientious. They would also have to decide the relationship between personal conviction and conscience, and individual motives and many other questions would arise. We believe that the amendment goes very wide indeed in allowing exceptions from the closed shop by those who oppose the political sympathies of unions, who oppose any form of strike action or who believe that membership of a union is incompatible to them.
      Mrs. Elaine Kellett-Bowman: Have not the recent events in Barnsley given the right hon. Gentleman some anxiety about this matter?
      4.0 p.m.
      Mr. Foot: I think that matters affecting the events in Barnsley would be more appropriately raised in our next debate when we discuss provisions affecting the Press. If questions are put to me then, I shall be happy to answer them. But the events in Barnsley have nothing to do with this aspect of the question under discussion. What is more, no provision which has been proposed would have dealt with the situation in Barnsley.
      I hope that that point will not be accepted as a valid one, because the wording proposed to be added would mean opening up a very wide possibility of closed shops or union membership agreements being nullified, which in turn would mean much greater difficulty and confusion in the establishment of such agreements. It would also mean that the individuals concerned would be unlikely to know for certain what were their rights, how they would be protected and what would be the outcome of any court action.
      Therefore, we do not believe that that is the right way to deal with the problem. That has been our view throughout. In many respects, the wording of the amendment—which, incidentally, is not the same as the wording in the Labour Party's Standing Orders, which in any event deal with a quite different range of subjects—is a good deal vaguer and more obscure even than the wording which has been proposed on previous occasions. We think, therefore, that the objections to it are all the stronger and that it would be quite wrong for this House to accept such wording to try to deal with the matter.
      However, I wish to underline strongly, because it partly indicates what I said at the beginning of my remarks, that the Government have been eager right from the beginning to ensure that the union membership agreements that we have are flexible and that they deal with all these questions as satisfactorily as possible. I repeat that we cannot deal with these matters satisfactorily in a statute but that we can deal with them in many of the agreements which will be made between employers and unions under the provisions of our legislation.
      In practice, prior to the Industrial Relations Act the great majority of closed-shop arrangements were operated
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      on a flexible basis. Individuals who were known to have strong personal objections to joining a union were mostly ignored, by tacit agreement between unions and management, even if there were written agreements which did not make exceptions for conscientious objectors, for example. That was the general rule and the general practice which prevailed prior to the Industrial Relations Act.
      The fact that a "union membership agreement" had to be defined for the first time in the Trade Union and Labour Relations Act, because of the unfair dismissal legislation that we were incorporating, led to some anxiety on the part of employers that if they operated flexible arrangements of this kind it could be held that there was not a valid closed shop agreement or that it was not properly operated to require the dismissal of non-members as provided for in the legislation. The decision in the case of the Ferrybridge Six, where the tribunal held that there was not a closed shop operating in practice because a number of employees had not been compelled to join a recognised union, confirmed these fears.
      The Amendment Bill therefore aims to restore the possibility of employers and unions making written exceptions for particular groups of employees like conscientious objectors on any grounds whatsoever and, in addition to written exceptions, agreeing in practice not to require other individuals to join a union if they accept their reasons for declining to join, without risk that they will be held not to have a closed shop agreement if they do so. The Bill therefore offers encouragement to more flexible arrangements which will enable individuals with valid objections to union membership which are accepted by unions and employers to stay in employment. The question of whether they receive compensation for unfair dismissal need not then arise.
      We think that that is a better way of dealing with the problem if it can be secured in that way.
      The Bill aims to introduce this fresh flexibility by two main changes. First, a new subsection has been added to Section 30 of the Trade Union and Labour Relations Act, where "union membership agreement" is defined, which makes

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      it clear that employees in the identifiable class to which a closed shop agreement relates may be identified by the parties to the agreement by reference to any characteristics or circumstances whatsoever. That is in Clause 3(4) of the Bill. This particularly affects written agreements and puts beyond doubt that an agreement may relate, for example, to all employees in a particular grade other than those who object to union membership on grounds of conscience. Some new closed-shop agreements—for example, at Burton's Tailoring, the Yorkshire Bank and British Rail—already include conscience clauses of this nature and other exceptions. This clarification should encourage others to follow suit.
      The second way in which the Bill aims to introduce this flexibility is that the definition of "union membership agreement" has been amended so that an agreement will comply with the definition if it has the effect in practice of requiring employees to belong to a specified union. Both the definition and the provision relating to unfair dismissals in paragraph 6(5) of Schedule 1 have been amended to delete references to every employee or all employees having to belong to a union and to substitute references to employees "for the time being" in the class of employee required in practice to belong to a union.
      These changes, which we have discussed on numerous occasions, should help, especially with informal "custom and practice" arrangements under which the unions and employers accept that certain individuals or groups with strong objections to joining a closed-shop union should not have to do so. They allow for toleration in practice of the individual objector even where no formal conscience clause is written into any agreement.
      I believe that this is the right way to deal with the problem in the interests of industrial relations and in the interests of the individual persons concerned. If we were to adopt the course which the House of Lords recommended, we would lose all the advantages which we hoped to gain from the careful way in which we tried to draft this legislation, and we would invite a number of cases to occur in which arguments would go to the courts about what was to be provided
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      under the so-called Hailsham clause. No one would know exactly what would be the outcome, no one would know how much this right led to fresh industrial troubles, and no one would know what protections were provided for the individuals concerned.
      I hope that the House will now at last accept the Bill and that it will go on to the statute book and be in operation very soon. I also hope that all concerned—everyone in the trade union movement especially—will seek to apply the legislation in the most tolerant and liberal manner. The legislation seeks, justly in my opinion, to give proper rights to workers who combine together to insist upon their rights. That is one essential freedom.
      We seek to combine that essential freedom—which the Industrial Relations Act attempted to remove—with protection for the individual which will really work. That is what we are seeking to do, and it is in that spirit that I ask the House once again to pass this legislation and to send it to the other place in the hope that, like so many other Bills, it will eventually reach the statute book.
      Mr. Leon Brittan: In supporting the Lords in their amendment, I must say that the Secretary of State seemed more subdued than usual. Perhaps that might be because of his impending hope of a higher office. He appeared to be somewhat distressed that the House of Lords should carry on looking at the legislation. One of the strange things about conscience is that it has a habit of refusing to lie down. That is what has happened in this legislation and that is why we make no apology for the fact that we are once again returning to the consideration of the degree of protection that an individual conscience can and should receive.
      The Secretary of State argued on the basis of a false premise because he spoke in terms of exceptions from the closed shop. The clause is not concerned with such exceptions at all. If the Lords amendment were passed it would be open to unions and employers to negotiate closed shop agreements of the toughest and most restrictive kind. If unions had the industrial power and desire to compel employers to enter into such agreement and if employers thought it was in the

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      interests of industrial peace, there is nothing in the Lords amendment which would in any way limit the operation of such a closed shop. An amendment relating to that proposal cannot be any kind of attack on closed shops or trade union rights.
      The amendment would not limit the operation of a closed shop but it would allow, in slightly wider circumstances than otherwise, a person who is dismissed in a closed shop situation to claim compensation for that dismissal. He would be entitled to such compensation not from the union because he would have no redress against the union. He would not get his job back in most circumstances and he would be entitled to compensation from the employer.
      4.15 p.m.
      If anybody should be concerned about the proposal, it is the employers and not the trade unions. But we have had no representations from the CBI or any other employers' interests that they are against conferring on employees the right to compensation if they are dismissed because they have refused to join a trade union in a closed shop situation—refused because of a sincerely held personal conscientious conviction and with no hope of financial gain or material advantage.
      No question of industrial disorder arises. The most that could be said is that there is an indirect connection between the amendment and the closed shop. It could be said that if employers had to pay compensation for unfair dismissal they would be less likely to enter into closed shop agreements. But if an employer felt that it was in his interest to respond to industrial pressure to enter into an agreement, he would be able to do so. All the hares raised about sequestrating union funds do not arise. The question is whether an individual should be entitled to compensation for unfair dismissal if he refuses to join a union on the grounds of religious belief or on the wider grounds that Lord Hailsham persuaded their Lordships to insert into the legislation.
      We are arguing in favour of the wider wording which would entitle an individual to compensation. We believe that it is out of date to confine an objection to union membership to the extremely narrow concept of religion. It is strange
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      that the Labour Party, with its history of honourable support for freedom of conscience even for atheists and non-believers, should cease to take that view. It now wants to confine itself to supporting only religious objections when compensation is involved.
      There are examples showing that the Government have accepted that an objection to union membership leading to compensation need not be on purely religious grounds. The Minister of State said during consideration of Lords Amendments to the Trade Union and Labour Relations (Amendment) Bill,
      "We do not argue that there may not be grounds for excluding persons, other than religious believers, from closed shop agreements."
      He went on to say that he believed that the legislation was sufficient to provide protection but
      "that those exceptions should be worked out and agreed upon by those whose consciences and beliefs are involved, so that a workable basis for toleration is established."—[Official Report, 15th October; Vol. 897, c. 1392.]
      The Government are not saying that the limitation should be so narrow as to confine it to those who object on religious grounds. They are saying only that it should be applied in a different way, not by legislation but by agreement between the unions and the employers, so that the individual concerned would not be required to join the union in the first place and therefore the question of compensation would not arise. It appears that there is more agreement on the broad principle than the Government would like us to believe. There is therefore no room for an attack on the House of Lords in general or on Lord Hailsham in particular as if they were seeking to engage in some kind of spoiling operation or reopening old wounds. We believe that it is possible to devise a reasonable test going beyond the question of religious belief.
      The Secretary of State put his head down into his brief and gave us details about the Ferrybridge case and talked about the desirability of maintaining flexibility in the operation of closed shop agreements. He tried to show that the legislation makes it possible to have a closed shop agreement which need not be as rigid as before. But that is not the case. Before Ferrybridge it was possible to have a closed shop which was

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      not properly enforced because it was not universally enforced. It was not universally enforced because in many cases exceptions were allowed. Individuals were perhaps known to have what the unions call "odd views" on these matters and union leaders were able to allow a person not to join the union because his views were known to be sincere. The Ferrybridge case has established that union membership agreements must be adhered to if they are to have any legal consequences.
      In their legislation the Government are enabling a union membership agreement to contain exceptions and exclusions and it is possible that these could cover grounds of conscience which are wider than religous grounds. Even in the Government's amended version of the legislation, the exceptions on grounds of conscience or profession have to be spelt out and defined in the agreement. We argue that it is just as easy and desirable to extend them in the statute to include grounds of conscience as it is to spell them out in the union membership agreement.
      It seems to me that if one is talking about the opportunity for discord, if one is talking about the opportunity for disagreement and strife, there is surely every bit as much scope for disagreement and strife if the union membership agreement prescribes an exception, and then there is argument whether that exception applies in a particular case, as there is if it is the statute that provides the exception. It might be argued that, because the statute is to operate on a nation-wide basis, there is much more scope for finding out through a series of decisions what the actual meaning of the words is in practice than if one has a whole host of individual union membership agreements, each of which could be a fruitful source of dissent.
      Mr. Foot: I am not seeking to comment obliquely on what the hon. Gentleman has said. I was not seeking to discuss Ferrybridge at all. I was discussing the relationship of what was said in the Ferrybridge case to this aspect of the matter. What was illustrated in Ferrybridge was exactly what we had said from these Benches—that the obscurity and confusion in which that part of the Act remained gave rise to
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      some of those difficulties. We think that some of those difficulties will be removed precisely by the legislation we are now putting through.
      Mr. Brittan: As the Secretary of State must surely realise, the point I was making in relation to Ferrybridge was a much narrower and a much more precise one than he has sought to answer. I was not defining the legislation generally. It is not in question in this amendment. This amendment is not the one on which Ferrybridge relied. Ferrybridge is important in an indirect way because Ferrybridge showed that it will be necessary in future to spell out any exceptions in union membership agreements. Irrespective of whether they are defined in such a way under the Government's legislation, they will have to be spelled out.
      One is left in the position that it is essential to ask ourselves the question—do we throw our hands up in the air and say that we have to narrow the test simply to a question of religion in this curiously old-fashioned and limited way, or can we expand it more widely than that? If so, is it possible to have a viable test which can be applied in practice?
      I suggest that the example in industry does support the proposition. There is the fact that there has been an agreement at Burtons, referred to by Lord Houghton, and the fact that there have been negotiations about an agreement at Vauxhall, which was referred to by my hon. Friend the Member for Bedfordshire, South (Mr. Madel). In those cases it has been possible, and thought capable of determination, to have a clause in the agreement which goes wider than just religion. If that is possible, it is possible in legislation as well.
      In the remainder of my remarks I seek to show other examples in which a test has been applied, or recommended, which goes wider than the question of religion and does not lead to the obscurity, or the open doors, or the endless argument that the Secretary of State put forward as the sole objection to the House of Lords amendment. Let us start with the Donovan Report. The Donovan Report recommended certain protections against exclusion and expulsion from unions. Donovan also referred

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      in this connection to conscientious objections. He was a lawyer and he was talking in precise terms. He did not argue in favour of confining the exceptions just to religious exceptions. He thought it was viable.
      It might be said that that was merely a Report, but it was a very authoritative Report. Let us, in any event, turn to what is on any view a firm legal document, Article 9 of the European Convention of Human Rights. I want to make it quite clear I am not for this purpose seeking to argue—although it is arguable—that what the Government are proposing is in breach of that Convention. Again I seek to make a narrower point, because that Convention says that everyone has the right to
      "freedom of thought, conscience and religion."
      If that means anything at all, it must mean that conscience and religion are different things and that they are things which are sufficiently different and yet sufficiently precise for it to be capable for them to be determined, if necessary by a court of law, and for a distinction to be made between conscience and religion—otherwise the Convention has no meaning. I am sure that the Secretary of State would not wish it to be thought that a Government of which he is a member is happy to continue to adhere to a Convention which would be as obscure and meaningless as that.
      From the commonsense point of view, quite apart from the law, it is difficult to distinguish between conscience and religion. I cited on a previous occasion the example which often happens of people who have dropped their belief in the religion in which they grew up but who retain a certain residual conscience derived from the historic legacy. An example would be somebody brought up as a member of the Plymouth Brethren who had lapsed in his former religious faith but had retained, as a legacy of it, a belief in not joining associations of a kind which would include trade unions. Such a person could not be said to have a religious objection but he would have a conscientious objection, an objection in the sense that he objected to joining, not because of some prudential argument balancing convenience but because of a fundamental belief, possibly an irrational belief, but certainly a fundamental belief.
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      This is therefore a distinction that may be made.
      Mr. John Lee: Surely that is not altogether an appropriate example. If a person lapses from a religion he is still, generically speaking, a member of that religious faith. There are a good many people in Northern Ireland who claim to be Catholics or Protestants and who are designated as such and for practical purposes are so regarded even though they no longer attend mass or religious services.
      Mr. Brittan: I do not agree with that, because I would have said that a person could not be thought to be a member of that religion if he no longer held its tenets. It may be that in countries where religions have formed the basis for political and social divisions, the former adherence to religion is sufficient to require the person concerned to be regarded to be within one community rather than the other. If one applied the legal test, such a person could not be said to be a member of that religious faith any more, but he might still have a belief on grounds of conscience which derive from the legacy of the religion to which he once adhered. The point I am making is that there is a distinction that can and ought to be drawn.
      The Secretary of State referred to the Standing Orders of the Parliamentary Labour Party. I certainly bow to him in his knowledge of them. They may have changed and they may change again but, as I understand the matter, there was a time when the relevant Standing Order read,
      "The Party recognises the right of members to abstain from voting in the House on matters of deeply-held personal conscientious conviction but this does not entitle members to cast votes contrary to a decision of the Party meeting."
      If that means anything, it means very much the same as this amendment—and it was at a time when Government Whips were feared men, whom Back Benchers defied at their peril. The question whether the decision that they took in those far-off, bygone days, was governed by that exception in Standing Orders was very appropriate. Whoever drafted those Standing Orders had in mind the concept that this was a precise definition which was capable of examination and scrutiny to sec whether the Member concerned

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      should receive a warning or worse or should be regarded as having exercised his legitimate rights as a loyal member of the Parliamentary Labour Party. I say that not just to pull the right hon. Gentleman's leg although, a slight move in that direction, I hope, is pardonable, but to make the serious point that a responsible body has come to the view that this discretion is viable. So it is.
      4.30 p.m.
      I then come to the final example of the concept of a conscientious objection being regarded as viable—an argument which in previous debates has, understandably, been misunderstood. But I think that we have explained that we do not wish to insult the trade union movement in any sense when we refer to the example of conscientious objection in time of war. One does not say that refusing to join a union is in any way comparable with not wishing to join the army in time of war, but in considering a matter which on any view was as serious at the time as the question of union membership, Governments of the day were perfectly happy for tribunals to decide whether someone was a conscientious, not a religious, objector.
      In the last war, 47,000 people were held to be conscientious objectors—not all of them, by any means, religious objectors. On another occasion, I cited a passage from a book by a professor who was chairman of the tribunal which considers these matters. He instanced the fact that many people who were held to be conscientious objectors were so on grounds other than religion.
      Therefore, we say that this is a viable test. We recognise the fear and the lack of desire of the Government that anything should encourage the free riders, the people who wish to have the benefits of union membership without the liabilities. It is for that reason that Lord Hailsham's amendment includes the words:
      "not motivated by hope of financial gain or material advantage".
      I therefore hope that it will be accepted that the amendment is in no sense spiteful or disruptive but is designed to give a fraction more scope to the still small voice of conscience and that that is a legitimate objective.
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      The Government say that it is not possible or viable to ask a tribunal to consider whether this test has been met. I would answer that if the test can be applied by tribunals considering conscientious objection in time of war, it can certainly be applied to industrial tribunals. Anyone who has been involved with the law knows that questions of a man's sincerity and honesty are daily considered by the cours. The question whether someone really believes something is not novel. We do not believe that this suggestion is wrecking or unviable and it is certainly not intended as a threat to the trade union movement.
      We believe that today, when the power of the unions is so great, when by permitting a member to join or to stay in a union they can have so great an effect on employment, it is right that we should slightly widen the circumstances in which the individual, on grounds of conscience, can gain protection, or at least compensation, from his employer. We believe that the trade union movement is strong enough and big enough to withstand this tiny extension of individual freedom. It would be a scandal and a disgrace if the Government were so affeared of the consequences that they refused on hidebound grounds of principle to accept this tiny advance.
      Mr. Cranley Onslow: The importance of this occasion, I think, was matched much more accurately by the mood and the phrases of the speech of my hon. Friend the Member for Cleveland and Whitby (Mr. Brittan) than by that of the Secretary of State. Perhaps understandably, the right hon. Gentleman was giving an unaccustomed impersonation of Mr. Harold Macmillan on a relaxed day. This is an important matter and I hope that the level of the debate can be raised to match its importance.
      I do not wish to go over familiar arguments but would like merely to remind the House once again of the enormous significance to ordinary working people in many lines of employment of the powers which this Bill gives to the unions. I can best do so by quoting a document with which the Secretary of State may be familiar, although others may not—a leaflet issued by the Association of Polytechnic Teachers last year on the subject of the closed shop.

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      That leaflet said in part:
      "Public discussion of the dangers inherent in the Bill has been restricted almost exclusively to the issue of freedom of the press, and attempts by this Association to point out similar dangers in education have met with little response, although sympathetic comment has appeared in The Times and the Daily Mail. Many teachers still maintain that the Closed Shop could not happen in Education, but they should note the position of the Association of Teachers in Technical Institutions, reported in The Times Higher Educational Supplement of November 14th. ATTI stated that they have been in favour of compulsory union membership since 1970: Existing plans suggest that individual local education authorities would be approached about compulsory union membership in areas where ATTI already has 75 per cent. membership."
      The leaflet goes on to list the disadvantages of a closed shop under seven heads, of which I want to draw attention now to only the first and the second. The first says:
      "It would mean a loss of personal liberty.
      "The freedom to belong or not to belong to a trade union of one's choice is arguably more important than academic freedom, and perhaps as important in the long term as freedom of speech."
      The second says:
      "It would threaten freedom of education.
      "If all lecturers had to belong to one trade union, that union would have the power to control educational policy."
      That is a serious argument and many of us on this side take it seriously.
      There is, therefore, some encouragement to be drawn from later developments, particularly those reported in the ATTI News Bulletin of February this year, which said:
      "The closed shop will not be introduced for teachers in the five London (ILEA area) Polytechnics. The removal of the threat to impose a closed shop is made clear in an agreement between the Committee of Directors of London Polytechnics, the ILEA and the ATTI … The London Joint Committee of the Association of Polytechnic Teachers had made representations … on the Conditions of Tenure document for the London Polys which contains the welcome paragraph."
      The article then quoted the relevant clause for each polytechnic, to which I shall have to add some qualification:
      "Teachers in the Polytechnic are not only permitted but encouraged to join an appropriate teachers' association or trade union. Teachers in the Polytechnic have the following rights in respect of trade union membership and activities:

      (a) the right to be a member of such trade union as the teacher chooses;

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      (b) the right not to belong to a trade union;

      (c) the right where a teacher is a member of a trade union to take part in its activities at appropriate times and to seek election to office in the union and to hold office in the union."

      That seems to me a good trinity of rights which should satisfy every reasonable aspirant to trade union membership and every consciencious objector to union membership.
      I should dearly wish to hear the Secretary of State say that the exceptions which he says his Bill provides would always take a form as concrete as that. Whatever he may say about the technical provisions of the Bill, there is a great need to provide much more reassurance and protection to the many people who are deeply worried about the effects of the Bill on their own personal liberties. If the right hon. Gentleman is in doubt about that, I invite him to ask the BBC whether he can see again the "Man Alive" programme which dealt revealingly with these matters. I make that point only because it must be made.
      I would add only one other point, more by way of a caution than anything else. In considering the powers which this Bill is to vest in the trade unions, it may occur to the Secretary of State that they are not wholly dissimilar from the powers which circumstances vested in the mediaeval Church. They are monopolistic powers, or can be used in a monopolistic way, undeniably. The Secretary of State may well remember that in the case of the mediaeval Church the most important monopoly that was acquired, or was claimed to be acquired, was the monopoly of salvation, and that the sanction which it employed in exercising that monopoly was excommunication. In the end the fact that there was such power corrupted the institution itself, and the fact that it claimed such a monopoly led to the downfall of the institution in the form in which it existed in its international or Roman manifestation.
      I do not want to stretch the comparison too far, but I suggest to the right hon. Gentleman that it would be ironic indeed if the monopolistic powers in this legislation were used by modern unions in such a way as to deny employees the right to work and if the sanction used to enforce that was forced unemployment, which is an undeniable consequence of

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      the closed-shop philosophy when applied in a rigorous, unimaginative and brutal way.
      Probably the Secretary of State will agree that, in considering any power, one has always to recognise the possibility of its being abused and that absolute power might well be used in a most brutal way. Before this legislation leaves this House, it is most important that we should once again sound a very serious warning against the consequences which could flow if all the mild words and the blandishments that we have heard from the Government side turned out to be a cloak for a brutal and utterly onerous imposition upon the rights of ordinary men to believe what they wish and to work where their skills take them.
      Mr. Kenneth Clarke: I share the Secretary of State's surprise that we should find ourselves discussing this subject again. I had rather feared that our last debate would be the last before the Bill reached the statute book and I am grateful to another place for giving us a further opportunity. I do not apologise for taking part again, for we are dealing with a very important and sensitive subject—how to maintain a minimum of personal freedom in the context of the closed shop in industrial relations. It is absolutely essential that Parliament gets that right, and I do not believe we shall do so if this Bill reaches the statute book in the form preferred by the Government.
      In case the Secretary of State should misunderstand me when he intervenes later, I had better make clear that I accept the case for the closed shop in industrial relations when entered into voluntarily by employers and trade unions which have quite legitimate industrial reasons. All those who accept that case also realise that there are a few instances where hardship is actually caused to individuals who for some personal, sincere reason find it impossible to join either any trade union or the particular trade union or unions which are parties to the closed shop agreement.
      In this debate we are discussing a division between the two sides—and it still remains—over the definition of which of those people should be entitled to compensation if actually dismissed because
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      of their inability to join a union. As my hon. Friend the Member for Cleveland and Whitby (Mr. Brittan) made crystal clear—and it is important that this should be understood—both sides, Government and Opposition, accept that there is a category of people entitled to compensation if they lose their jobs. It is the definition of which those people should be that is dividing us, and, as my hon. Friend made clear, the Government are, for some peculiar reason, taking a very narrow view of the definition based on religious scruples alone. We say, and another place has said, that one is entitled to a more flexible view and in consequence we seek another definition of a sensible, non-financial, sincere motive at least to the extent of enabling someone who has lost his livelihood to go to a tribunal and to get compensation from the employer.
      4.45 p.m.
      I have to admit that I prefer the definition written into previous legislation, I believe on a Liberal amendment during the period of minority Government that compensation should be available—that is the practical effect—to anybody who objects on any reasonable ground to joining a trade union. That definition has proved unacceptable to the Government. Attempting to resolve the deadlock, the noble Lord, Lord Hailsham, has successfully moved an amendment which he believes is based on the Standing Orders of the Labour Party, which is the amendment we are discussing.
      We are told by the Secretary of State that this is not an accurate reproduction of those Standing Orders but I am sure that if that is so we would all willingly accept from the Government an amendment to make sure that the text fairly and exactly reflects those Standing Orders in their present form. But something should be produced by the Government, who should not rely only on religious belief. It should be noted that the noble Lord, Lord Shepherd, said on behalf of the Government in another place:
      "So we put in religious belief because it can be identified, based on scripture."—[Official Report, House of Lords, 24th February 1976; Vol. 368, c. 634.]
      That seems to me an extraordinarily narrow definition of a workable concept of conscience. Agnostics are not to have

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      their personal scruples respected. Indeed, personal convictions seem likely to be restricted to those small minority sects who rely very much on scriptural interpretation. I speak with no disrespect for their personal convictions but it is absurd for the Government to insist that entitlement to compensation should be retained for Plymouth Brethren or Jehovah's Witnesses but is not open to anyone else who may have his own personal convictions of a non-scriptural or non-religious kind.
      Mr. Lee: How does the right hon. Gentleman anticipate that one can adequately define a non-religious conscientious objection in this context in a way that will not exclude the phoney or bloody-minded person using it merely as an opportunity for ideological purposes and taking advantage of it?
      Mr. Clarke: The definition which another place has written in seeks to exclude those acting for financial or phoney motives, but the hon. Member for Birmingham, Handsworth (Mr. Lee) defends the Government with the only argument they have used. They say that it is not workable but they have not designed any other definition that can be applied exactly. I will not repeat the arguments of my hon. Friend the Member for Cleveland and Whitby who pointed out that the Donovan Commission thought such a definition would be workable. He quoted the European Convention on Human Rights, to which this country is a party, and the equivalent situation which arose when dealing with conscientious objections to military service in time of war.
      But in practice when considering workability Government speakers have used the point that conscience is well recognised in the best closed shop agreements themselves in a way that parties to those agreements believe is practicable. I quote from the closed shop agreement of the Central Electricity Generating Board which contains this particular passage:
      "An employee who is consequently notified that his employment is to be terminated as a result of failure to comply with the conditions … shall have a right of appeal against such termination to the independent body specified … on the grounds of conscience, unreasonable refusal or termination of trade union membership subject to the employee notifying his Board of his intention to exercise this right within seven days of notification to him by the Board of their intention to terminate his contract of service."
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      One looks to see which independent body is to examine these matters of conscience:
      "The independent body referred to in Clause 271 shall consist of one or more persons appointed for the purpose by the Department of Employment and Productivity, assisted by two assessors (without voting power), nominated respectively by the Electricity Boards and Trade Unions' Members of the NJIC. The decision of the Independent body shall be final and binding on the employing Board the Trade Union and all employees.'
      So it is considered workable for a nominee of the Secretary of State to decide an issue of conscience when it is referred to him under that agreement but apparently the Secretary of State believes that his own industrial tribunals, which are used to dealing with similar matters, are incapable of deciding if legislation from this House refers the same question to them. Surely the industrial tribunals should be allowed to decide matters of conscience in a fair way.
      The situation within the CEGB leads me to the case of the Ferrybridge Six, a matter which has given rise to so much difficulty.
      Mr. John Page: Will my hon. Friend confirm that existing agreements will not be overruled should the decision of another place be overruled? Perhaps my hon. Friend will make that clear.
      Mr. Clarke: I have not considered that matter. I imagine that the terms of closed shop agreements will remain the same. I imagine that they will be unaffected by this legislation. Closed shop agreements which failed to make provision for acts of conscience will be overtaken by this legislation. It will give to aggrieved persons in industry, where a closed shop agreement does not have a consicence clause, the right to go to an industrial tribunal, a right which they otherwise would not have.
      The Ferrybridge Six case has illustrated the dangers of closed shop agreements. Difficulties arise if the law does not adequately cover the issue that is involved. The tribunal that considered the Ferrybridge case had a chance to consider the effect of the existing reasonable grounds provision, but it ducked the issue and went on to find that the dismissals were unfair for other reasons. It based its judgment on a finding that the closed shop agreement was not in practice being enforced throughout the in-

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      dustry. The consequence of that finding is that it is now being enforced vigorously throughout the industry.
      The tribunal had the opportunity of establishing some case law on what reasonable grounds might be. Unfortunately, it was so intimidated by or fearful of the political controversy that was being aroused by this legislation passing through the House that, having considered what constitutes reasonable grounds, it put its findings into a sealed envelope and allowed no one to see them. That was an extraordinary procedure to be followed by a quasi-judicial body. As far as I am aware, even the parties to the appeal were not allowed to see the tribunal's findings. They might have been extremely useful in illustrating the nature of reasonable grounds.
      Mr. Foot: When the hon. Gentleman talks about the tribunal being politically intimidated, what does he mean? What justification has he for saying anything of the sort?
      Mr. Clarke: I am not saying that anyone put pressure on the tribunal to adopt the procedure that it followed, or that the Government instructed it to place its findings in a sealed envelope. I believe that the tribunal felt embarrassed to give a judgment when the issue was of such controversy and when legislation was passing through the House. That is my understanding. On its own volition it decided not to give the public or anyone else the opportunity to consider what would otherwise have been a judicial pronouncement.
      I feel that the tribunal adopted a grossly unsatisfactory procedure. If a court of law put part of its judgment in a sealed envelope and did not allow anyone to see it, there would be a tremendous fuss, not least from the Government Benches. However, no one has bothered about the action of the tribunal, a body which in some respects is answerable to the right hon. Gentleman.
      My hon. and learned Friend the Member for Dover and Deal (Mr. Rees) and myself have asked Questions of the Department of Employment. On one occasion the Minister of State replied to a Written Question:
      "It would appear from the decision of the industrial tribunal which heard the case of
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      the Ferrybridge Six that the contents of the sealed envelope were not considered by the tribunal to be relevant to its decision; and that the tribunal considered that it would only become relevant if the decision were to be reversed by an appellate tribunal. However the envelope has not at any time come into my possession nor into the possession of any member of my Department. The envelope is in the custody of the tribunal and the question of who is permitted to see its contents, and any question of publishing those contents, are matters for the tribunal or for any appellate body to whom the tribunal provided the information. Industrial tribunals are independent judicial bodies and, except for the specific requirements imposed by procedural regulations, they are free to regulate their own procedure. It would not be proper for me to attempt to influence their procedure in particular cases.—[Official Report, 1st March 1976; Vol. 906, c. 448.]
      With the greatest respect, I think that the right hon. Gentleman ran away from the problem at the fastest possible speed. There are instances in which he and his right hon. and learned Friend the Attorney-General intervene like a shot to influence the procedure of tribunals if they begin to behave improperly or in a non-judicial manner.
      It is clear that the Minister of State has not had the envelope come into his possession. More important, he has taken no steps to try to get it into his possession or to make it available to the House and the public. The envelope and its contents would be exceedingly important in enabling us to carry on an informed debate about how reasonable grounds, or conscientious grounds, for not joining a union might be applied in practice.
      The Minister of State, Department of Employment (Mr. Albert Booth): As the hon. Gentleman has referred to my Answer, will he concede that the contents of the envelope may reveal more than we know about the tribunal's decision—namely, why those who appealed may not be entitled to benefit? It may not be in the interests of the Six for me to secure the contents of the envelope and to make them available, quite apart from my decision that it is improper for any Minister to interfere with the practice of a tribunal.
      Mr. Clark: With great respect, I do not believe that that is the Minister's main reason for wanting the contents of the envelope to be kept secret—namely, that it may compromise the position of the Six. That is not a reason that was put forward by the tribunal. I believe that

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      the tribunal did not want to be involved in the political debate. That is understandable, but that is not a proper attitude for a judicial body to take when deciding an important matter of this kind.
      A tribunal has had to consider reasonable grounds in a major case, and I believe that the Minister would be doing a service to the House if he insisted on obtaining the contents of the envelope and publishing them. We could then see what problems might arise in practice. The case is of huge importance.
      It has been suggested that the Ferrybridge Six are six isolated men who are entirely concerned with their own problems. As distinguished a trade union leader as Clive Jenkins gave the impression on a recent radio programme that the Six are concerned only with their own positions, but in my constituency there are hundreds of men whose fate depends on the Ferrybridge decision. They are former members of the Electricity Supply Union.
      In my constituency the most arbitrary procedure is being applied to many former members of the ESU at the power stations at Ratcliffe on Soar and Wilford. They are trying to enter the closed shop agreement and, in the process, to join one of the four signatory unions in the CEGB agreement. However, some of them are finding that their applications are not being accepted. It is being insisted that they must apply to join the union of which they were previously members before they left to join the ESU. They are not being allowed the elementary liberty of choosing which of the four signatory unions they might wish to join within the closed shop agreement so as to protect their employment.
      The application of the closed shop agreement is applied in various ways and in an arbitrary manner from place to place according to the decision of the local shop steward. At Ratcliffe on Soar the Transport and General Workers' Union, which seems to be the preferred union of most of my constituents, has accepted all applications for membership. At the Wilford power station 27 men applied to join the Transport and General Workers' Union. They were accepted and their paid their subscriptions. However, after the Ferrybridge case and the
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      tribunal's decision they were told that their membership had been reconsidered. They have been rejected and their subscriptions have been returned. Once more, they face the prospect of dismissal along the lines of the Ferrybridge Six. They wait anxiously to see whether they are entitled to compensation.
      The present shambles has resulted from the dismantling of the previous legislation. It surely would be preferable for the Government to define the conscience grounds that might apply in a closed shop agreement. In the CEGB, and in the power stations in my constituency, the closed shop agreement is not being applied in a reasonable manner. The Secretary of State has expressed the hope that all concerned will apply it in a tolerant manner, but in practice it is not being applied in that way.
      The right hon. Gentleman cannot rely on hopes. Let him adopt what has been suggested in another place. If the Government have their way the Bill will reach the statute book in a form which is punitive, discriminatory and unfair. Individuals will be denied compensation when they should obtain it because they have lost their jobs as a result of honest and sincere beliefs.
      The problem surrounding the ESU is only the beginning. There will be the problem of professional workers who will be unable to join trade unions in certain industries because the unions' policy conflicts with their professional judgment and standards.
      This House should above all be—in fact, this is normally the case—a respecter of conscience and honesty. It should try to give protection to those who hold conscientious and honest beliefs. The history of the trade union movement is full of the protection of the men of conscience against interference and discrimination. It is quite wrong suddenly to reverse this situation and begin to support intolerance and arbitrary power in the trade union context simply because that happens to be the political prejudice of the government of the day.
      5.0 p.m.
      Mr. David Madel: I imagine that the Secretary of State is beginning to have nightmares about the Bill. It has been to and fro

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      so many times. That nightmare is probably equalled only by his fear of even more unemployment in this country.
      I had hoped that the Secretary of State would attempt to answer the two central questions raised by Lord Hailsham when he put forward this amendment in another place. They were
      "whether we protect a Plymouth Brother by giving him a right to compensation against his employer but not a respectable Agnostic, or whether, if they are acting sincerely and on conscientious grounds, we put the two on the same footing"
      and
      "whether we are going to protect an employer against paying compensation to a conscientious worker who does not happen to be actuated solely by religious belief."—[Official Report, House of Lords, 24th February 1976; Vol. 368, c. 628–32.]
      It is around this narrow, central point that we have argued for so long.
      When the Secretary of State spoke earlier, he was in a conciliatory mood and spoke about his hope that trade unions would be tolerant and flexible in working these arrangements. In the Financial Times of Monday of this week, however, reference was made to a private TUC circular sent out by Mr. Len Murray. According to the Financial Times,
      "All unions in the TUC have been advised by Mr. Len Murray, TUC general secretary, to tighten their running of closed shops where they exist, in order to prevent individuals making successful claims of unfair dismissal against employers."
      Later the article says:
      "The circular warns that employers will be reluctant to enter into 100 per cent. union membership agreements or accept them tacitly if there is any prospect of dismissed workers securing compensation".
      But a worker will secure compensation from his employer. There would be no raiding of union funds or snatching or grabbing of union property. If the amendment went through, the employer would have to pay if the individual concerned could show reasonable grounds of conscience.
      The circular from the TUC makes an even more important point. It says that problems of enforcement were most likely to occur where two or more unions organised for the same group of workers in a closed shop. The Financial Times says:
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      "Here common policies and practice would be especially important, the circular says."
      If two unions operated in a closed shop and one dropped out for some reason, its members might not wish to join the union which took over operation of the closed shop. There could be instances of individuals objecting to join a particular union on conscientious grounds because of that union's conduct or attitude to industrial problems, international trade or tariffs. The amendment merely seeks to ensure that where there are such difficulties an individual would have the right to compensation from the employer.
      My hon. Friend the Member for Rushcliffe (Mr. Clarke) mentioned professional conscience. I hope that the Secretary of State saw a letter in The Times this week from Mr. Tony Dummett, Chairman of the Council of Engineering Institutions. He said:
      "because of the polarisation of private industry into employers on the one hand and shop floor or white collar unions on the other, professional people are being forced to join unions that neither represent their interests nor are able to respect their code of conduct."
      If there were a professional code of conduct, could not that be accepted as a genuine ground of conscience for refusing to join a particular trade union?
      If the Hailsham amendment were accepted, how difficult would it make things for trade unions? Would it lead to industrial smash-ups, difficulties and arguments? I do not think so. Our tribunals are sufficiently skilled to find out whether someone is motivated by financial gain or personal advancement or whether a man has a genuine conscientious objection to joining a union.
      We are seeking only the tiniest of tiny concessions from the Government. I do not believe that it would cause strikes, difficulties or disruptions. It would be easier for employers to make closed-shop agreements, and the amendment would protect them from people who put forward silly grounds for not joining a union. Employers would have nothing to fear.
      I do not know why Len Murray sent out that circular and got into such a state about what might happen to employers. He should have sent out a circular saying that the Hailsham amendment was sensible and reasonable and would not lead to industrial difficulties.
      Mr. John Page: I should like to begin my mentioning the unmentionable—the late Industrial Relations Act. Had the February 1974 General Election not taken place, the Industrial Relations Act would have become part of our industrial scenery. It would have been willingly accepted by trade union leaders and members, by employees who were not members of a trade union and by employers. They would have accepted it because of its innate fairness and because it gave trade unions more powers to go alongside more responsibilities. This argument has not so far been used in the debate. We have had this debate on repeated occasions, and it is difficult to find new aspects which have not been touched on already.
      The Government and some of their potential Prime Ministers are on trial today because of the conscience clause of the Parliamentary Labour Party which is reflected in the amendment we are discussing.
      I accept that the Government's proposition is put forward from sincerely-held personal and conscientious convictions, but would it be possible for the Secretary of State or his hon. Friends to say that in putting it forward they were not motivated by hope of financial gain or material advantage—financial gain from the paymasters and part owners of the Labour Party, and material advantage to the Government in standing to attention and saluting smartly when they receive their orders from Mr. Len Murray, who is, of course, the real generalissimo?
      It is the Government who are on trial. The case has been heard in the House of Lords and dismissed. One of the judges was a very distinguished member of the Labour Party, Lord George-Brown. He found the proposition on the closed shop and the presentation of it—among other matters, admittedly—the last straw that he could no longer bear, coming from the party he had known and loved and served so well.
      Whatever happens to the vote on the amendment, no divine right is given to trade unions to impose the closed shop on any group of employees or on any company. The closed shop may be imposed only after an agreement has been freely reached by employers and the
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      totality of their employees. Incidentally, it is still felt by many employers that if they pay £6·20 instead of the £6 limit they may find themselves being marched towards the guillotine. But, of course, this is not the case.
      It is most important that members of trade unions and employees throughout the country should know that a closed shop can be imposed only after there has been agreement between themselves and their employers. It is because of that fact, perhaps, that the Government are taking these steps this afternoon. They may wish to give a little more strength to the trade unions in the bargaining position they now hold.
      Very few people feel at present that the power of the trade unions is too weak. Quite a number feel that the balance is weighted rather too strongly in favour of trade unions, groups of trade unions and groups of workers.
      My hon. Friend the Member for Bedfordshire, South (Mr. Madel) mentioned a report in the Financial Times of last Monday. It would not be possible to refer to a report in the Financial Times of today because it was not printed. A group of compositors who are members of the National Graphical Association exercised a form of censorship on that newspaper because they disapproved of what was to be printed. That is a dangerous situation. The newspaper printing industry has one of the tightest closed shops and, as a report indicated yesterday, some of the greatest overmanning.
      In his speech the Secretary of State for Employment used the argument that if the Bill were left as it stands, unamended, there will be a fear that the effect of the closed shop might be nullified. That is an almost too far-fetched argument to be accepted at the present time.
      My hon. Friend the Member for Rushcliffe (Mr. Clarke) presented a most interesting, well-argued and unanswerable case on the religious aspect. I am surprised that hon. Members on the Government side should give so little opportunity for atheists and agnostics in matters of conscience. Very often the conscience of the non-religious is given a good run in the House. Why should it not be given a sensible run in relation to this Bill?

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      5.15 p.m.
      Concerning the position of professional people, I should like the House to envisage a case in which a number of doctors employed by local authorities, following agreement between the local authorities and the employees' organisation concerned, could be compelled to become members of NALGO. If there were a dispute between NALGO and the local authorities, a doctor would be compelled to put his Hippocratic oath into his case with his stethoscope and to put aside the principles he adopted at the time of his registration.
      I remind the House of the case of the professional engineers at Rolls-Royce, Bristol, whose work was blacked. Although they were members of their professional body, UKAPE, pressure was applied to force them to become members of DATMS.
      The right hon. Gentleman talked about the tolerant and liberal way in which he would like to see the Act applied. Surely he must realise that there are a good many intolerant and illiberal people and that we do not always find liberal attitudes in dealings between trade unions and employees in a firm.
      On those grounds, and in particular on the ground of the conscience clause to which hon. Members on the Government side have subscribed in their parliamentary work, I hope that the Secretary of State will not reject the amendment.
      Mr. John Pardoe: I agree with the comments of the hon. Member for Harrow, West (Mr. Page) that there are far too many intolerant and illiberal people in the country—even in the Liberal Party. I did not, however, agree with the hon. Member's observation concerning a connection between the Government's views on this matter and the payments given by the trade union movement to the Labour Party—or, indeed, a connection with Generalissimo Murray, as I think he was described earlier in the debate.
      I do not think that it is necessary to be paid by the trade unions to do exactly what they say. Only three weeks ago the Leader of the Opposition and the Conservative Front Bench spokesman on employment indicated in their speeches
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      that when the time came they would be an even better poodle to the trade unions than this Government has been. We wait with interest to see them jump through the hoop for Generalissimo Murray in the future. No doubt when that time comes they will ditch all the arguments about conscience that we have heard this afternoon.
      Mr. John Page: I want to spring to the defence of my right hon. Friend the Leader of the Opposition and my right hon. Friend the Member for Lowestoft (Mr. Prior). I happened to hear their speeches. I am sure that if I send him copies of the speeches the hon. Gentleman will, with his characteristic tolerance, liberality and honesty, agree that they bear no relation at all to what is suggested.
      Mr. Pardoe: I have read the entire speech of the Leader of the Opposition. I have not read the speech of the right hon. Gentleman, although I have read a very extensive Press report of it. I do not think, therefore, that the argument really applies in my case.
      In case the Secretary of State or his hon. Friend raise the matter, I admit immediately that the Liberal record on the question of conscience cannot perhaps, be defined as entirely consistent. In the principal Act a Liberal amendment inserted what might be called a reason clause. It was not acceptable to the Government, and certainly we fall back on the conscience clause as perhaps more narrowly defined. My right hon. Friend the Member for Orkney and Shetland (Mr. Grimond), in one of our earlier debates, on this matter, said on behalf of the Liberal Party that he believed in the Government's charter and thought that it might settle the matter.
      In another place my noble Friend Lord Wigoder said:
      "If this Amendment were to be considered in a vacuum—simply on its own merits—it would meet with the enthusiastic support of my noble Friends on these Benches."—[Official Report, House of Lords, 24th February 1976; Vol. 368 c. 639.]
      He went on to argue that the rigours of the Parliament Act meant that they should not go on opposing the matter time and time again. That was why my noble Friends abstained on the last occasion.

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      However, I am not confined by the Parliament Act and therefore I am sure that the Secretary of State will agree that I can put forward my arguments. In case there is some further confusion in the Secretary of State's mind, let me assure him that what I say today is, of course, the definitive version of the Liberal Party's view of this matter, although I recognise that some of my right hon. and hon. Friends have the right to object on grounds of conscience, reason, religion or any other darn fool thing they can think up.
      We must make it absolutely clear that we are considering not a man's right to join or not to join a union but the narrower issue whether he should have the right to sue his employer for wrongful dismissal if he refuses to join a trade union in a closed-shop situation and thereby loses his job. We are dealing with the argument about conscience and religion.
      It was implicit in the speech by the Secretary of State that one of the Government's main arguments is the difficulty of defining conscience. What about the difficulty of defining religion? I wonder how the Secretary of State defines religion in this context. Religion can be very wide. It involves not just a few sects, as some Conservative Members seem to think.
      I am a member of the Church of England. There are many good reasons for being a member of that Church but perhaps the best reason of all is that one can never be quite certain what it implies one believes in. There are wide differences between the Low Church and the High Church. Therefore, as a good member of the Church of England, I dare say that I could find excellent scriptural doctrinal reasons for not joining trade unions generally, or a particular trade union.
      One does not have to be a Voltaire to believe that certain types of religion are little more than superstition. The Secretary of State will understand that reference, even if the hon. Member for Birmingham, Handsworth (Mr. Lee) does not understand it. I wonder what Voltaire would have said to the Government's proposition that a man should be entitled to sue on the grounds of super-
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      station but not on grounds of sincerely-held conscience arrived at by reason.
      One objection to conscience that was raised by the hon. Member for Birmingham, Handsworth in an earlier intervention was that it was a net of too wide a mesh, and that therefore too many people would be able to get through it. So be it. There is no doubt that in the past some—we have no idea exactly how many—ne'er-do-wells and totally useless people were able to avoid military service in this country, America, or wherever, on the ground of conscientious objection. However, some people will be able to get through the net on grounds of religion and some will not be what many people would regard as worth while in that connection. Therefore, the abuse and the fear to which the hon. Gentleman has referred are worth while, because we must set them against the greater good of allowing the liberty of conscience.
      The Government have not made out their case for balancing the dangers of allowing this "wide-mesh" net of conscience against religion. They should be prepared to accept the dangers implicit in the word "conscience" and accept the amendment. I certainly propose to support it.
      Mr. Tony Newton: I wish to make a brief contribution to the debate. I freely and frankly admit that I have been prompted to do so by a letter that I have received from one of my constituents. I have chosen to refer to one letter not because there are not many other letters that could be quoted but because this one is particularly compelling and relevant to the arguments that are being put forward. It is not a letter from a crank with red capital letters all over the place and great underlinings. It is not a letter from somebody who has not considered the matter. It is a letter from someone who is an articulate and educated young woman who feels so strongly on this matter that she took the trouble to write a careful, thoughtful and long letter to me. Therefore, I shall not attempt to quote it all. However, I should like to refer to it briefly in the course of my speech.
      The letter starts by referring to the "fear" which this Act has instilled in my constituent. That is something that the

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      Secretary of State and his hon. Friends should bear in mind.—[Interruption.] I hope that hon. Members will listen to what I have to say. If they had listened to what ordinary people said about the proposed legislation and not only to the views of the mandarins of the trade unions, we might have had a more sym pathetic approach to some aspects of the discussion during the past few months. My constituent goes on to say—
      Mr. Sydney Bidwell: The reason the hon. Gentleman is getting the horse's laugh is that those of us with long experience of these matters, inside and outside the House, recall that the Conservatice Government upheld the principles of the closed shop in their legislation in 1971.
      Mr. Newton: We are not arguing about the principles of the closed shop—
      Mr, Pardoe: Perhaps we should.
      Mr. Newton: As the hon. Member for Cornwall, North (Mr. Pardoe) has said, perhaps we should do so. However, primarily we are arguing about the grounds on which certain limited exemptions may be made allowing compensation when dismissal takes place in those circumstances.
      My constituent says:
      "Personally, I am employed at the moment as a secretary … However, nothing would induce me to join any trade union, and I am resolved and resigned to the dismissal that I shall receive. If the fact that I will not join a union means that I will be unable to obtain further employment—then that is how it will be. I am lucky, I am a young married woman who intends, anyway, to have a family within the foreseeable future; dismissal from my employment therefore just advances my family plans a little. However, my husband and millions like him, are not so lucky."
      She then goes on to refer to her husband's problems, and in the end she says that she suspects that he will be forced to agree to join a trade union. She says:
      "But that does not mean mental compliance, and the conflict of conscience is agonising!"
      At the end of her letter she says:
      "I don't know your personal, or professional views on this matter, but I appeal to your humanity. Please oppose this movement towards oppression".
      The Secretary of State, Labour Members and especially the hon. Member for Ealing, Southall (Mr. Bidwell) will no
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      doubt say that my constituent's fears are exaggerated or that she is wrong to feel the way she does. However, the point is that she does feel like that as a result of a Bill which this Parliament is proposing to pass. I did not seek to become a Member of Parliament and would not wish to continue to be a Member of Parliament if I thought that our debates, discussions and consequent legislation were creating that kind of worry, anxiety and of fear of the law.
      Mr. Lee: I have no doubt that the letter is written in a serious tone, but does the writer at any stage enlarge upon the basis of her conscientious objection? Does she define it in any way?
      Mr. Newton: I listened to the hon. Gentleman's earlier intervention in one of my hon. Friend's speeches, and it seemed to me that he did not meet—nor has any other Labour Member—the fundamental point advanced by my hon. Friends the Members for Cleveland and Whitby (Mr. Brittan) and Rushcliffe (Mr. Clarke), that we find it perfectly possible as a society—and, indeed, under legislation in the case of conscientious objection to military service—to deal with broad grounds which none of us can define in detail but which we have found it possible to establish machinery to assess.
      5.30 p.m.
      Two factors stand out for me in these debates, and the Secretary of State's arguments have done nothing to meet them. First, the provisions that the Government say are impossible in this context are possible in many other contexts of our society, including some cases which are laid down by law. I have heard nothing that suggests to me that it would not be possible to apply those provisions in this area. The Secretary of State has failed to meet the argument that all these difficulties will arise in the case of every closed-shop agreement and the conscience clauses. These problems of interpretation exist and the Secretary of State's argument amounts to his saying "I do not want the provisions confined to religious objection. I am happier to see wider grounds, but I want to leave that to other people to sort out in individual cases".
      It is not good enough for Parliament to pass a law that the Secretary of State regards as unsatisfactory and then to

      1587
      leave it to a host of private bodies outside to make their own rules to cover a vital matter of this sort. That is an unsatisfactory way of making legislation.
      The second factor is that I know well—I suspect that Labour Members know it too—that if legislation containing these sorts of proposals had been brought forward by the Conservatives in any other sphere of activity in our society the National Council for Civil Liberties would be remonstrating on our doorstep, the Tribune Group would be shouting "Fascists" across the Chamber, and the Secretary of State for Employment would be leading the van of the protests. It is intolerable that we should be expected to assent to proposals which, simply because they deal with trade unions, are acceptable but which no one on either side of the House would accept if they dealt with any other aspect of our nation's affairs.
      Mr. James Prior: This is the twelfth or thirteenth time that we have debated this amendment, and each time we debate it our case seems to improve and the Government's case seems to weaken. I was extremely interested to hear the views of the Liberal Party. Perhaps it would be unwise to try to give the Liberals too much advice. They seem to jump with the speed of light on to every bandwagon before reading the speeches of their opponents. When the hon. Member for Cornwall, North (Mr. Pardoe) and one of his colleagues made speeches about what Conservatives had said about their attitude to the closed shop one would have guessed that they had studied what we said with great care. It transpires, however, that the hon. Member has not even read my speech, but that does not stop him arriving at far-reaching conclusions, which no doubt he will change tomorrow.
      Mr. Pardoe: I read the speech of the Leader of the Opposition and I read a long Press report of what the right hon. Gentleman said. Is he saying his speech so totally contradicted what his Leader said that I needed to read both of them? Do they never agree in what they say?
      Mr. Prior: When the hon. Gentleman is making such accusations he should at least study the speeches carefully before he resorts to print. If I can give him any advice—no doubt this is the trouble with
      1588
      the Liberal Party, the whole way along—it is that his party is always moving to wards the sound of gunfire but as soon as they get near the guns they start to retreat. I only hope that the definitive view of the Liberal Party on this issue will last a little longer than the definitive view of the Liberals on most other issues. This afternoon my hon. Friends have expressed a number of important and strongly-held views on the subject of the closed shop. The issue boils down to this. We know that a certain number of union leaders do not want the law to be brought into this activity, yet they contradict themselves, because in many other respects they have accepted the law. They have accepted the Employment Protection Act, which involves the law to a greater degree in trade union and employment affairs than any other Act has ever done. They have accepted the Trade Union and Labour Relations Act, which also involves the law in a great many cases. Yet they say that they do not want the law involved in the question of conscience and the closed shop. That is an unsatisfactory state of affairs, which we cannot accept.
      The Liberals are worried about the free rider, the crank, and the odd man out. Generally speaking, they have dealt reasonably tolerably with these people in the past. Donovan said:
      "Our impression from the evidence we have heard is that trade unions in the main respect genuine conscientious objections, and are usually content if the objectors agree to pay to some charitable body the equivalent p OI union dues".
      But the Commission found that it was
      "liable from time to time to cause substantial injustice to individuals from which they have no effective means of redress". It is this that concerns my hon. Friends and me.
      The Secretary of State has admitted that this situation exists, because he says that he hopes—and I agree with him—that unions and employers will write in to union membership agreements conscience clauses which are fair. The right hon. Gentleman has gone that far with us, but he objects to having that written into the Bill because he says there cannot be a precise enough definition. Most of the lawyers to whom I have spoken say that the words "on any reasonable grounds "can be perfectly fairly interpreted by the courts. The word "reasonable" is commonly used in the law. The common law

      1589
      can be interpreted by common lawyers in a perfectly sensible and reasonable way, and therefore I cannot accept what the Secretary of State says. If the conscience clause in a union membership agreement has to be interpreted, surely it would be much better if the House of Commons laid it down in the Act.
      My hon. Friend the Member for Rushcliffe (Mr. Clarke), in an excellent speech, dealt at some length with the Ferrybridge Six. I agree with what he said. I do not understand why the Industrial Tribunal has not given its views on the reasonableness of the case. It would have helped us in our debates and it would help us to come to a proper decision in these matters. On the other hand, I do not go so far as my hon. Friend in believing that the Secretary of State or the Minister of State would have been right to intervene and ask for those views. I am not certain they have any powers to do so. It would be wrong for them to interfere, but the Tribunal was wrong in not giving its views.
      My hon. Friend the Member for Bedfordshire, South (Mr. Madel) mentioned the case of professional people who have an objection to joining a union because it conflicts with their professional etiquette. That should be properly taken account of in a conscience clause. For these reasons, too, it seems that the law as the Government wish it would be wrong.
      I want to make our position absolutely clear. All Conservative Members who have spoken this afternoon recognise that the closed shop will exist in a number of industries and that it makes in many respects for good industrial relations. However, throughout the passage of this Bill and the previous Bill we fought for a proper conscience clause. We proposed some ourselves. We supported the Liberals on others. We are now trying a new conscience clause which conforms closely to the Labour Party's conscience clause—which the Chief Whip will know all about.
      If we find, as we anticipate that we shall find, that the arrangements which can be made under union membership agreements are not satisfactory, it will be the duty of a future Conservative Government to ensure that effective provision
      1590
      is made. We cannot leave the situation in any doubt. It is important and right that this House decides a matter of individual conscience in favour of the individual. There is no doubt that a future Conservative Government would take action in this respect.
      Until this afternoon I had hoped that the Secretary of State would agree to write that into the Bill. I am glad that he said what he did about writing it into union membership agreements. However, that will not go far enough. I understand the willingness of the TUC to move in the direction of writing a clause into a union membership agreement. However, greater interests are at stake here. My hon. Friend the Member for Braintree (Mr. Newton) portrayed this well in his remarks. Conservative Members cannot be satisfied at leaving the matter where it is. I hope that the Secretary of State will appreciate that we do not believe that he protects the rights of the individual in a difficult situation—a situation which Donovan recognised. My hon. Friend the Member for Cleveland and Whitby (Mr. Brittan) dealt at length with the question of conscientious objection. He was concerned whether cases relating to military service had been fairly decided. It is right that there should be a conscience clause written into the Bill.
      For those reasons I ask all hon. Members to join us in striking a blow for liberty, which will not strike at the root of the closed shop or at the root of the trade union movement. The trade union movement is quite strong enough to withstand the effects of a conscience clause. In the past few months I have urged people to join a union and to play a part in a union. No one can accuse us of trying to undermine unions. However, there are issues of deeply-held personal conviction which we in this House should protect. A conscience clause and a closed-shop situation is one of them.
      Mr. Foot: If the House will permit me to reply again, I shall try to do so briefly, although brevity is no sign that I do not treat the debate with proper respect. In no sense do I complain that the debate was proposed in a spiteful manner by the other place. However, we have debated the matter on a number of occasions. That is a statement of fact from which I am sure the hon.

      1591
      Member for Cleveland and Whitby (Mr. Brittan) would not dissent, because he has participated in many of these debates.
      5.45 p.m.
      The proposal of the House of Lords is an even worse way of dealing with the problem than those we previously rejected, one of which was advanced by the Liberal Party. The advantage of this debate is that we have the definitive view of the Liberal Party at least on one question. I hope that the same will happen on future occasions, although whether it will be the hon. Member for Cornwall, North (Mr. Pardoe) who makes such definitive utterances I do not know. I was fascinated to hear that he has joined the Church of England for the same reason as he joined the Liberal Party, namely, that he was not required to believe in anything of any significance. If we were to devise a conscience clause on that basis it would have to be very wide.
      That is the dilemma of this debate. As the right hon. Member for Lowestoft (Mr. Prior) said, many forceful speeches have been made by Conservative Members. However, in my opinion one half of their speeches cancelled the other half. All were very good but they left a complete negative at the end. The hon. Member for Bedfordshire, South (Mr. Madel) argued that this was only a small amendment, which would not make much difference to the industrial situation. He asked why such a narrow amendment of this kind could not be accepted because it would not make any difference—it would not open up great opportunities for people to destroy the closed shop. However, the hon. Member for Rushcliffe (Mr. Clarke) made a powerful speech and spoke principally about the Ferrybridge Six. If he was in order in making that speech and referring to Ferrybridge and if the situation at Ferrybridge were to be allowed under this kind of provision, it would need to be a very wide provision because it would have to say that the whole Ferrybridge operation could be supported by this sort of clause.
      That brings me to the remarks of the right hon. Gentleman and his tame lawyers, who told him that all these matters could be easily settled. I am glad that he withdrew any suggested criticisms of industrial tribunals. I am specially glad, because in another place Lord Hailsham
      1592
      upbraided me for not having intervened to instruct the insurance authorities how to behave. When I suggested that the matter was sub judice Lord Hailsham said that it was a most extraordinary affair for me to shelter under any damned silly sub judice argument. I am not saying that he used those words, but that was the tenor of his remarks.
      Both I and my right hon. Friend the Minister of State have behaved perfectly properly towards industrial tribunals. I am glad that the right hon. Member for Lowestoft has restored the situation. He and his lawyers have said that the matter can be settled quite easily and that on reasonable grounds there is no difficulty. However, this was one of the special difficulties as regards the Ferrybridge judgment. Paragraph 62 says:
      "The next and extremely difficult problem is as to what constitutes an objection 'on any reasonable grounds'. There is no guidance whatsoever from Parliament on what constitutes such grounds and we all three strongly resent being given the task of deciding this question. It is contrary to the conventions of the constitution of this country, as I understand them, for a judicial body to have to decide such a question which carries political and controversial implications. Parliament should say what are reasonable grounds …".
      The Tribunal was echoing in slightly different words only what I said in opposition to the very amendments and clauses which the Opposition advanced. The Ferrybridge case took place under the quite obscure legislation which came from another place and which we were foolish enough to allow through in this House. We seek to make that legislation clearer.
      Mr. Kenneth Clarke: The Secretary of State seems to quote that passage with approval. Does he not agree that if Sir John Donaldson, in his days in the Industrial Court, had uttered a similar passage and said that the next part of his judgment was a matter of some political controversy and therefore he would place it in a sealed envelope and not allow the parties or party to know what the envelope contained, he would have been the first Member of this House to leap up and suggest that the Attorney-General or the Secretary of State responsible should do something about a judicial body that behaved in that way.
      Mr. Foot: I hope that the hon. Gentleman is not inviting me to repeat my comments on the trigger-happy

      1593
      Donaldson, because I got into some trouble when I did that before. Some rebukes were passed on to me, not from members of the Government but from the national Press and institutions of that nature. They said that I should not criticise Donaldson in such a manner. I marvel at my moderation—like Robert Clive—in the case of Lord Donaldson. However, I learned my lesson, as we all have to learn. I must be very careful of what I say about industrial tribunals, and I shall not be tempted, even by the hon. Gentleman, into passing judgment upon them now. It would be quite wrong to do so.
      What I am illustrating is that the tribunal which had to deal in this important matter with the same legislation that we passed through this House came to the same view that we came to about it, namely, that the legislation was obscure, unworkable and that the tribunal was not able to operate it in the way that it thought satisfactory.
      Mr. Brittan: I am sure that the right hon. Gentleman does not wish to confuse the House. However, there are in the Chamber hon. Members who were not present at the beginning of the debate. I am sure that he would want to confirm that whether or not that is a fair criticism of that legislation, the industrial tribunal was expressing no view on the clause that we are now debating and on which he is replying.
      Mr. Foot: I fully agree with the hon. Gentleman. It has hardly been necessary for me to intervene in the debate at all, because hon. Members are so brilliant at contradicting one another. What the hon. Gentleman does not appreciate is that he has just knocked one of his hon. Friends through the ropes and said not merely that his speech was wrong but also that it was out of order.
      Mr. Brittan: I am content to leave questions of order to the Chair, but I was hoping that the Secretary of State would answer the debate on this amendment rather than seek to obscure the issue by saying that some other amendment, part of some other legislation, was or was not a good thing.
      Mr. Foot: If the hon. Member for Rushcliffe, who raised the matter of Ferrybridge, was in order—apparently he was, because he was not pulled up by the Chair—I was entitled to say that presumably he was relating it to this clause, and therefore this clause, far from being narrow, was very wide. It was on that ground that I was quoting what the tribunal said, and explaining why we could not proceed in that way.
      Opposition Members contradict one another, but the hon. Member for Cleveland and Whitby has brilliantly contradicted himself. He referred to the European Convention on Human Rights. He suggested that what we were doing was in contravention of that convention, or that it might be held to contravene it. I thought that the hon. Gentleman was citing the convention in order to upbraid us for having been in some way neglectful about its possible provisions.
      Mr. Brittan: If that is really what the right hon. Gentleman thought I was saying he must have suffered a temporary attack of deafness. I said that it was arguable that we were in breach of the convention. I was seeking to show that the convention made a distinction between conscience and religion. It was for that purpose, and that only, that I cited the convention. If the convention can conclude that there is a viable legally enforceable distinction between conscience and religion, so can this House.
      Mr. Foot: The convention was applying it particularly, as the context reveals, to military service. Indeed, when the convention was drawn up, special provision was made to make it clear that it was not expected that the clause would apply to anything like the closed shop. Therefore, that is why I say that by citing the convention the hon. Gentleman is injuring his argument. In 1951, when the convention was drawn up, the Conservatives drew the distinction that we draw between conscience as applied in these circumstances and conscience as applied in relation to military service. Opposition Members say that the analogy fits altogether and we say that it does not.
      Mrs. Kellett-Bowman: Will the right hon. Gentleman kindly draw the attention of the House to the precise point

      1595
      in the convention where that distinction appears?
      Mr. Foot: If the hon. Lady studies the debates that took place when the convention was drawn up, in 1951, she will find that the closed shop was perfectly legitimate when the convention was signed. There were discussions about what it would mean. Therefore, it was specifically stated in those terms in order to ensure that it would not be regarded as ruling that the closed shop should be unlawful.
      Perhaps I may conclude by saying that in my view the House has reached the best way of trying to settle this matter. That is to say, we have examined carefully the ways in which these provisions may operate. Mr. Len Murray certainly had to take action after the Ferrybridge judgment, because under that judgment, if it stood, indeed the operation of the closed shop, or the operation of union membership agreements, would be in a state of great obscurity. The Ferrybridge judgment made it necessary for Len Murray to write in that sense. He was basing his suggestions to unions on what had occurred there.
      What we are seeking to do is to make the law itself clear about this matter, to put the law into a state in which it does not give rise to ambiguities and not where we judge whether there should be a closed shop)—or a union membership agreement, as we prefer to call it—in
      one circumstance. We prefer to leave that matter to the employers and workers in the industry concerned. None of the fears and horrors that hon. Members like to portray can occur unless the employers also agree to the proposition. That is the simple fact.
      What we also want to secure is that when arrangements are reached in different industries, in different circumstances and between different sorts of employers and different unions, they shall all take into account the kind of considerations that we had in mind when we made this agreement as flexible as possible. I hope that they will take them into account.
      I hope that once again the House will vote on this subject as it has voted on 20 previous occasions. It does not mean in any sense at all that we are voting against liberty or the protection of liberties. What we are seeking to do, and just what right hon. Members of the Opposition failed to do, is to combine individual liberties with the protection of other liberties and the recognition that the right of association is also one of the essential liberties for the people of this country. It is for the protection of two liberties that we on the Government side of the House fight.
      Question put, That this House doth disagree with the Lords in the said amendment:—
      The House divided: Ayes 298, Noes 253.

      Division No. 92.]

      AYES

      [5.58 p.m.

      Abse, Leo

      Brown, Robert C. (Newcastle W)

      Cunningham, G. (Islington S)

      Allaun, Frank

      Brown, Ronald (Hackney S)

      Cunningham, Dr J. (Whiten)

      Anderson, Donald

      Buchan, Norman

      Davidson, Arthur

      Archer, Peter

      Buchanan, Richard

      Davies, Bryan (Enfield N)

      Armstrong, Ernest

      Butler, Mrs Joyce (Wood Green)

      Davies, Denzil (Llanelli)

      Ashley, Jack

      Callaghan, Rt Hon J. (Cardiff SE)

      Davis, Clinton (Hackney C)

      Ashton, Joe

      Callaghan, Jim (Middleton & P)

      Deakins, Eric

      Atkins, Ronald (Preston N)

      Campbell, Ian

      Dean, Joseph (Leeds West)

      Atkinson, Norman

      Canavan, Dermis

      Delargy, Hugh

      Bagier, Gordon A. T.

      Cant, R. B.

      Dell, Rt Hon Edmund

      Bain, Mrs Margaret

      Carmichael, Neil

      Dempsey, James

      Barnett, Guy (Greenwich)

      Carson, John

      Dormand, J. D.

      Barnett, Rt Hon Joel (Heywood)

      Carter, Ray

      Douglas-Mann, Bruce

      Bates, Alt

      Carter-Jones, Lewis

      Duffy, A. E. P.

      Bean, R. E.

      Cartwright, John

      Dunlop, John

      Benn, Rt Hon Anthony Wedgwood

      Clemitson, Ivor

      Dunnett, Jack

      Bennett, Andrew (Stockport N)

      Cocks, Michael (Bristol S)

      Dunwoody, Mrs Gwyneth

      Bidwell, Sydney

      Cohen, Stanley

      Eadie, Alex

      Bishop, E. S.

      Coleman, Donald

      Edge, Geoff

      Blenkinsop, Arthur

      Colquhoun, Ms Maureen

      Edwards, Robert (Wolv SE)

      Boardman, H.

      Concannon, J. D.

      Ellis, John (Brigg & Scun)

      Booth, Rt Hon Albert

      Conlan, Bernard

      Ellis, Tom (Wrexham)

      Boothroyd, Miss Betty

      Cook, Robin F. (Edin C)

      English, Michael

      Bottomley, Rt Hon Arthur

      Corbett, Robin

      Ennals, David

      Boyden, James (Bish Auck)

      Cox, Thomas (Tooting)

      Evans, Fred (Caerphilly)

      Bradford, Rev Robert

      Craigen, J. M. (Maryhill)

      Evans, loan (Aberdare)

      Bradley, Tom

      Cronin, John

      Evans, John (Newton)

      Bray, Dr Jeremy

      Crosland, Rt Hon Anthony

      Ewing, Harry (Stirling)

      Brown, Hugh D. (Provan)

      Cryer, Bob

      Fernyhough, Rt Hon E.

      Fitch, Alan (Wigan)

      Lipton, Marcus

      Rose, Paul B.

      Fitt, Gerard (Belfast W)

      Litterick, Tom

      Ross, Rt Hon W. (Kilmarnock)

      Flannery, Martin

      Loyden, Eddie

      Ross, William (Londonderry)

      Fletcher, Raymond (Ilkeston)

      Luard, Evan

      Rowlands, Ted

      Fletcher, Ted (Darlington)

      Lyon, Alexander (York)

      Sandelson, Neville

      Foot, Rt Hon Michael

      Lyons, Edward (Bradford W)

      Sedgemore, Brian

      Ford, Ben

      Mabon, Dr J. Dickson

      Selby, Harry

      Forrester, John

      McCartney, Hugh

      Shaw, Arnold (Ilford South)

      Fowler, Gerald (The Wrekin)

      MacCormick, lain

      Sheldon, Robert (Ashton-u-Lyne)

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

      McCusker, H.

      Shore, Rt Hon Peter

      Freeson, Reginald

      McElhone, Frank

      Short, Rt Hon E. (Newcastle C)

      Garrett, John (Norwich S)

      Mackenzie, Gregor

      Short, Mrs Renee (Wolv NE)

      Garrett, W. E. (Wallsend)

      Mackintosh, John P.

      Silkin, Rt Hon John (Deptford)

      George, Bruce

      Maclennan, Robert

      Silkin, Rt Hon S. C. (Dulwich)

      Gilbert, Dr John

      McMillan, Tom (Glasgow C)

      Sillars, James

      Ginsburg, David

      McNamara, Kevin

      Silverman, Julius

      Golding John

      Madden, Max

      Skinner, Dennis

      Gould, Bryan

      Magee, Bryan

      Small, William

      Gourlay, Harry

      Mallalieu, J. P. W.

      Smith, John (N Lanarkshire)

      Graham, Ted

      Marks, Kenneth

      Spearing, Nigel

      Grant, George (Morpeth)

      Marquand, David

      Spriggs, Leslie

      Grant, John (Islington C)

      Marshall, Dr Edmund (Goole)

      Stallard, A. W.

      Grocott, Bruce

      Marshall, Jim (Leicester S)

      Stott, Roger

      Hamilton, James (Bothwell)

      Mason, Rt Hon Roy

      Strang, Gavin

      Hamilton, W. W. (Central Fife)

      Maynard, Miss Joan

      Strauss, Rt Hon G. R.

      Hardy, Peter

      Meacher, Michael

      Summerskill, Hon Dr Shirley

      Harper, Joseph

      Mellish, Rt Hon Robert

      Swain, Thomas

      Harrison, Walter (Wakefield)

      Mendelson, John

      Taylor, Mrs Ann (Bolton W)

      Hart, Rt Hon Judith

      Millan, Bruce

      Thomas, Jeffrey (Abertillery)

      Hattersley, Rt Hon Roy

      Miller, Dr M. S. (E Kilbride)

      Thomas, Mike (Newcastle E)

      Hayman, Mrs Helene

      Miller, Mrs Millie (Ilford N)

      Thomas, Ron (Bristol NW)

      Healey, Rt Hon Denis

      Molloy, William

      Thompson, George

      Heffer, Eric S

      Molyneaux, James

      Thorne, Stan (Preston South)

      Henderson, Douglas

      Moonman, Eric

      Tierney, Sydney

      Hooley, Frank

      Morris, Alfred (Wythenshawe)

      Tinn, James

      Horam, John

      Morris, Charles R. (Openshow)

      Tomlinson, John

      Howell, Rt Hon Denis

      Morris, Rt Hon J. (Aberavon)

      Torney, Tom

      Hoyle, Doug (Nelson)

      Moyle, Roland

      Tuck, Raphael

      Huckfield, Les

      Mulley, Rt Hon Frederick

      Urwin, T. W.

      Hughes, Rt Hon C. (Anglesey)

      Murray, Rt Hon Ronald King

      Varley, Rt Hon Eric G.

      Hughes, Mark (Durham)

      Newens, Stanley

      Wainwright, Edwin (Dearne V)

      Hughes, Robert (Aberdeen N)

      Ogden, Eric

      Walker, Harold (Doncaster)

      Hughes, Roy (Newport)

      O'Halloran, Michael

      Walker, Terry (Kingswood)

      Hunter, Adam

      Ovenden, John

      Ward, Michael

      Irvine, Rt Hon Sir A. (Edge Hill)

      O'Malley, Rt Hon Brian

      Watkins, David

      Irving, Rt Hon S. (Dartford)

      Owen, Dr David

      Watkinson, John

      Jackson, Miss Margaret (Lincoln)

      Padley, Walter

      Watt, Hamish

      Janner, Greville

      Paisley, Rev Ian

      Weetch, Ken

      Jay, Rt Hon Douglas

      Palmer, Arthur

      Weitzman, David

      Jeger, Mrs Lena

      Park, George

      Wellbeloved, James

      Jenkins, Hugh (Putney)

      Parry, Robert

      White, Frank R. (Bury)

      Jenkins, Rt Hon Roy (Stechford)

      Pavitt, Laurie

      White, James (Pollok)

      John, Brynmor

      Peart, Rt Hon Fred

      Whitehead, Phillip

      Johnson, James (Hull West)

      Pendry, Tom

      Whitlock, William

      Johnson, Walter (Derby S)

      Perry, Ernest

      Willey, Rt Hon Frederick

      Jones, Alec (Rhondda)

      Phipps, Dr Colin

      Williams, Alan (Swansea W)

      Jones, Barry (East Flint)

      Powell, Rt Hon J. Enoch

      Williams, Alan Lee (Hornch'ch)

      Jones, Dan (Burnley)

      Prentice, Rt Hon Reg

      Williams, Rt Hon Shirley (Hertford)

      Kaufman, Gerald

      Price, C. (Lewisham W)

      Williams, Sir Thomas

      Kelley, Richard

      Price, William (Rugby)

      Wilson, Alexander (Hamilton)

      Kerr, Russell

      Radice, Giles

      Wilson, Gordon (Dundee E)

      Lambie, David

      Rees, Rt Hon Merlyn (Leeds S)

      Wilson, Rt Hon H. (Huyton)

      Lamborn, Harry

      Reid, George

      Wilson, William (Coventry SE)

      Lamond, James

      Richardson, Miss Jo

      Wise, Mrs Audrey

      Latham, Arthur (Paddington)

      Roberts, Albert (Normanton)

      Woodall, Alec

      Leadbitter, Ted

      Roberts, Gwilym (Cannock)

      Woof, Robert

      Robinson, Geoffrey

      Wrigglesworth, Ian

      Lee, John

      Roderick, Caerwyn

      Young, David (Bolton E)

      Lestor, Miss Joan (Eton & Slough)

      Rodgers, George (Chorley)

      Lever, Rt Hon Harold

      Rodgers, William (Stockton)

      TELLERS FOR THE AYES:

      Lewis, Arthur (Newham N)

      Rooker, J. W.

      Mr. David Stoddart and Mr. Peter Snape.

      Lewis, Ron (Carlisle)

      Roper, John

      NOES

      Adley, Robert

      Bennett, Dr Reginald (Fareham)

      Boyson, Dr Rhodes (Brent)

      Alison, Michael

      Benyon, W.

      Braine, Sir Bernard

      Amery, Rt Hon Julian

      Berry, Hon Anthony

      Brittan, Leon

      Arnold, Tom

      Biffen, John

      Brocklebank-Fowler, C,

      Atkins, Rt Hon H. (Spelthorne)

      Biggs-Davison, John

      Brotherton, Michael

      Awdry, Daniel

      Blaker, Peter

      Brown, Sir Edward (Bath)

      Baker, Kenneth

      Body, Richard

      Bryan, Sir Paul

      Banks, Robert

      Boscawen, Hon Robert

      Buchanan-Smith, Alick

      Bell, Ronald

      Bottomley, Peter

      Buck, Antony

      Bennett, Sir Frederic (Torbay)

      Bowden, A. (Brighton, Kemptown)

      Budgen, Nick

      1598

      1599

      Bulmer, Esmond

      Hurd, Douglas

      Peyton, Rt Hon John

      Burden, F. A.

      Hutchison, Michael Clark

      Pink, R. Bonner

      Butler, Adam (Bosworth)

      Irving, Charles (Cheltenham)

      Price, David (Eastleigh)

      Chalker, Mrs Lynda

      James, David

      Prior, Rt Hon James

      Churchill, W. S.

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

      Pym, Rt Hon Francis

      Clark, Alan (Plymouth, Sutton)

      Jessel, Toby

      Raison, Timothy

      Clark, William (Croydon S)

      Johnson Smith, G. (E Grinstead)

      Rathbone, Tim

      Clarke, Kenneth (Rushcliffe)

      Jones, Arthur (Daventry)

      Rawlinson, Rt Hon Sir Peter

      Clegg, Walter

      Jopling, Michael

      Rees, Peter (Dover & Deal)

      Cockcroft, John

      Joseph, Rt Hon Sir Keith

      Rees-Davies, W. R.

      Cooke, Robert (Bristol W)

      Kaberry, Sir Donald

      Renton, Rt Hon Sir D. (Hunts)

      Cope, John

      Kellett-Bowman, Mrs Elaine

      Renton, Tim (Mid-Sussex)

      Cordle, John H.

      Kershaw, Anthony

      Ridley, Hon Nicholas

      Corrie, John

      Kilfedder, James

      Ridsdale, Julian

      Costain, A. P.

      King, Evelyn (South Dorset)

      Rifkind, Malcolm

      Craig, Rt Hon W. (Belfast E)

      King, Tom (Bridgwater)

      Roberts, Wyn (Conway)

      Crowder, F. P.

      Kitson, Sir Timothy

      Rodgers, Sir John (Sevenoaks)

      Davies, Rt Hon J. (Knutsford)

      Knox, David

      Ross, Stephen (Isle of Wight)

      Dean, Paul (N Somerset)

      Lamont, Norman

      Rossi, Hugh (Hornsey)

      Dodsworth, Geoffrey

      Lane, David

      Rost, Peter (SE Derbyshire)

      Drayson, Burnaby

      Langford-Holt, Sir John

      Royle, Sir Anthony

      du Cann, Rt Hon Edward

      Latham, Michael (Melton)

      Sainsbury, Tim

      Durant, Tony

      Lawrence, Ivan

      St. John-Stevas, Norman

      Eden, Rt Hon Sir John

      Lawson, Nigel

      Scott, Nicholas

      Edwards, Nicholas (Pembroke)

      Lester, Jim (Beeston)

      Shaw, Gilles (Pudsey)

      Elliott, Sir William

      Lewis, Kenneth (Rutland)

      Shelton, William (Streatham)

      Emery, Peter

      Lloyd, Ian

      Shepherd, Colin

      Fairbairn, Nicholas

      Loveridge, John

      Shersby, Michael

      Fairgrieve, Russell

      Luce, Richard

      Silvester, Fred

      Farr, John

      McAdden, Sir Stephen

      Sims, Roger

      Fell, Anthony

      McCrindle, Robert

      Sinclair, Sir George

      Finsberg, Geoffrey

      Macfarlane, Nell

      Skeet, T. H. H.

      Fisher, Sir Nigel

      MacGregor, John

      Smith, Dudley (Warwick)

      Fletcher-Cooke, Charles

      Macmillan, Rt Hon M. (Farnham)

      Speed, Keith

      Fookes, Miss Janet

      McNair-Wilson, M. (Newbury)

      Spence, John

      Forman, Nigel

      McNair-Wilson, P. (New Forest)

      Spicer, Jim (W Dorset)

      Fowler, Norman (Sutton C'f'd)

      Madel, David

      Spicer, Michael (S Worcester)

      Fox Marcus

      Marshall, Michael (Arundel)

      Sproat, lain

      Fraser, Rt Hon H. (Stafford & St)

      Marten, Neil

      Stainton, Keith

      Galbraith, Hon T. G. D.

      Mates, Michael

      Stanbrook, Ivor

      Gardiner, George (Reigate)

      Mather, Carol

      Stanley, John

      Gardner, Edward (S Fylde)

      Maude, Angus

      Steen, Anthony (Wavertree)

      Gilmour, Rt Hon Ian (Chesham)

      Maudling, Rt Hon Reginald

      Stewart, Ian (Hitchin)

      Gilmour, Sir John (East Fife)

      Mawby, Ray

      Stokes, John

      Glyn Dr Alan

      Maxwell-Hyslop, Robin

      Stradling Thomas, J.

      Godber, Rt Hon Joseph

      Mayhew, Patrick

      Tapsell, Peter

      Goodhart, Philip

      Meyer, Sir Anthony

      Taylor, R. (Croydon NW)

      Goodhew, Victor

      Miller, Hal (Bromsgrove)

      Taylor, Teddy (Cathcart)

      Goodlad, Alastair

      Mills, Peter

      Tebbit, Norman

      Gorst, John

      Miscampbell, Norman

      Temple-Morris, Peter

      Gow, Ian (Eastbourne)

      Mitchell, David (Basingstoke)

      Thatcher, Rt Hon Margaret

      Grant, Anthony (Harrow C)

      Moate, Roger

      Townaend, Cyril D.

      Gray, Hamish

      Monro, Hector

      Trotter, Neville

      Griffiths, Eldon

      Montgomery, Fergus

      Tugendhat, Christopher

      Grist, Ian

      Moore, John (Croydon C)

      van Straubenzee, W, R.

      Grylls, Michael

      More, Jasper (Ludlow)

      Viggers, Peter

      Hall, Sir John

      Morgan, Geraint

      Wainwright, Richard (Coine V)

      Hall-Davis, A. G. F.

      Morris, Michael (Northampton S)

      Wakeham, John

      Hamilton, Michael (Salisbury)

      Morrison, Charles (Devizes)

      Walder, David (Clitheroe)

      Hampson, Dr Keith

      Morrison, Hon Peter (Chester)

      Walker, Rt Hon P. (Worcester)

      Hannam, John

      Mudd, David

      Wall, Patrick

      Harrison, Col Sir Harwood (Eye)

      Neave, Airey

      Walters, Dennis

      Harvie Anderson, Rt Hon Miss

      Nelson, Anthony

      Warren, Kenneth

      Hastings, Stephen

      Neubert, Michael

      Weatherill, Bernard

      Havers, Sir Michael

      Newton, Tony

      Wells, John

      Hawkins, Paul

      Nott, John

      Whitelaw, Rt Hon William

      Heath, Rt Hon Edward

      Onslow, Cranley

      Wiggin, Jerry

      Heseltine, Michael

      Oppenheim, Mrs Sally

      Winterton, Nicholas

      Hicks, Robert

      Osborn, John

      Wood, Rt Hon Richard

      Higgins, Terence L.

      Page, John (Harrow West)

      Young, Sir G. (Ealing, Acton)

      Holland, Philip

      Page, Rt Hon R. Graham (Crosby)

      Younger, Hon George

      Hordern, Peter

      Pardoe, John

      Howe, Rt Hon Sir Geoffrey

      Parkinson, Cecil

      TELLERS FOR THE NOES:

      Howell, David (Guildford)

      Pattle, Geoffrey

      Mr. Spencer Le Marchant and Mr. Michael Roberts.

      Hunt, David (Wirral)

      Penhaligon, David

      Hunt, John

      Percival, Ian

      Question accordingly agreed to.

    New Clause A

      FREEDOM OF THE PRESS
      Lords amendment: No. 2, after Clause 1, in page 1, line 21, at end insert—
      "A. After section 1 of the principal Act there shall be inserted the following section:—
      1A.—(1) If, before the end of the period of twelve months beginning with the passing of the Trade Union and Labour Relations (Amendment) Act 1975, there is agreed among parties including employers of journalists (or employers' associations representing such employers), editors (or editors' organisations), and trade unions representing journalists, a charter containing practical guidance for employers, trade unions and editors and other journalists on matters relating to the freedom of the press, the Secretary of State shall lay before both Houses of Parliament a draft of that charter.
      (2) For the purposes of subsection (1) above, practical guidance on matters relating to the freedom of the press must include guidance on the avoidance of improper pressure to distort or suppress news, comment, or criticism, the application of union membership agreements to journalists (and in particular the rights of editors to discharge their duties and to commission and to publish any article) and the question of access for contributors.
      (3) If no such charter has been agreed as mentioned above, or if a draft charter laid before Parliament (under subsection (1) above or this subsection) is not approved by resolution of each House of Parliament as mentioned in subsection (6) below, the Secretary of State shall after consultation with the Press Council and such of the parties referred to in subsection (1) above, such organisations representing workers, and such organisations representing employers, as he thinks fit, prepare in draft a charter, as follows:—

      (a) where, or so far as, there appears to the Secretary of State to be agreement among the parties referred to in subsection (1) above on any matter relating to the freedom of the press, he shall incorporate in the draft charter such practical guidance as he thinks appropriate to give effect to that agreement;

      (b) where, so far as there appears to the Secretary of State to be no such agreement on any of the particular matters referred to in subsection (2) above, he shall incorporate in the draft charter such practical guidance on that matter as he thinks fit,

      and the Secretary of State shall lay the draft charter before both Houses of Parliament.
      (4) A charter agreed as mentioned in subsection (1) above, or prepared by the Secretary of State in accordance with subsection (3) above, shall define its field of operation.
      (5) A charter agreed as mentioned in sub section (1) above, or prepared by the Secretary of State in accordance with subsection (3) above, shall provide for the constitution of a body which shall have the functions of—

      (a) hearing any complaint by a person aggrieved by a failure on the part of any other person to observe any provision of the charter;

      (b) issuing to the parties a declaration as to whether such a complaint is well-founded; and

      (c) securing the publication of its decision.

      (6) If a draft laid under subsection (1) or (3) above is approved by a resolution of each House of Parliament, the Secretary of State shall issue the charter in the form of the draft.
      (7) A charter for the time being in force under this section may be revised from time to time by agreement between such parties as are referred to in subsection (1) above, and the Secretary of State shall lay a draft of the revised charter before both Houses of Parliament.
      (8) If a draft laid under subsection (7) above is approved by a resolution of each House of Parliament, the Secretary of State shall issue the revised charter in the form of the draft.
      (9) On issuing a charter or revised charter under subsection (6) or (8) above the Secretary of State shall make by statutory instrument an order specifying the date on which the charter or revised charter is to come into effect.
      (10) A failure on the part of any person to observe any provision of a charter which is for the time being in force under this section shall not of itself render him liable to any proceedings, but in any proceedings—

      (a) any such charter shall be admissible in evidence, and

      (b) any provision of such a charter which appears to the court or tribunal to be relevant to any question arising in those proceedings shall be taken into account by the court or tribunal in determining that question." "

      Read a Second time.
      Mr. Prior: I beg to move, as an amendment to the proposed amendment, to leave out subsection (3).
      Mr. Speaker: I hope that it will be convenient to take also the other amendments to Lords Amendment No. 2, namely, in subsection (4), leave out
      ' or prepared by the Secretary of State in accordance with subsection (3) above'.
      In subsection (5), leave out
      ' or prepared by the Secretary of State in accordance with subsection (3) above'.
      In subsection (6), leave out' or (3)'.
      Mr. Prior: The purpose of the amendments is absolutely clear. They seek to remove from the Secretary of State—I assure him that there is nothing personal in this—the duty of acting in the event of the Press charter not being agreed by the parties concerned. We have come to the conclusion that in the circumstances of the Press charter not being agreed between the two sides, it would be wise not to press the matter further in the way suggested in the original amendments.
      We have had a number of interesting and long debates on this subject. I do not wish to delay the House in coming to a quick decision this evening, but I wish to make a number of points in seeking to explain the reason for our amendments.
      We have always believed that there was a need for a Press charter to be put into the Bill and to be made enforceable so that if the charter was not adhered to an aggrieved person would have some remedy. This view has always been rejected on the ground that it would deny to a journalist the right to form a closed shop. I believe that the whole issue of the Press is of such importance that it is right to deny to journalists a closed shop if that closed shop would lead to the suppression of news from any source whatever.
      We now come to deal with a situation under which the charter is not enforceable. Therefore, we have to consider the charter in the voluntary form in which it was laid down in an earlier amendment.
      When the Goodman amendments, if I may so call them, came forward on a previous occasion, we felt it right to keep the charter in the Bill and to make it enforceable. The Secretary of State for Employment argued that it was wrong for Parliament to lay down the contents and that there must be an agreement between the parties concerned. Since the charter is unenforceable, it can be effective only by agreement of those directly involved. Therefore, the Secretary of State should not be required to act if there is a failure to agree. We do not see this in any sense as derogatory to the Secretary of State, but we believe that this is not a suitable matter in which Parliament should become involved. Parliament should not have control over the freedom of the Press, and there is a fear that
      1604
      under the charter a degree of control would be exercised by the Secretary of State.
      6.15 p.m.
      The Secretary of State for Employment has made his views so abundantly clear on these matters in the past that there are some doubts about his impartiality in such a situation. In view of what he has said on other occasions, both in the House and elsewhere, agreement between the National Union of Journalists and other parties involved in any charter would be unlikely to be reached, and the Secretary of State would be called in to produce a charter which would have to be laid before the House. We believe that such a situation is not tenable and that it would be far better if the charter were to exclude the Secretary of State.
      The House of Commons has never discussed in detail the implications of the Secretary of State being given this power, and the power would be given to him in a vague and ill-defined fashion. We have spent a great deal of time discussing enforceability without also discussing the powers to be given to a Secretary of State in this respect.
      For these reasons, our amendment should meet the wishes on every side of the Press. The amendments would give the right to a charter, but they would not give the right to a Minister of any Government to interfere in drawing up a charter. If the charter could be agreed between the two parties, it would be laid before Parliament by the Secretary of State and would form the basis on which these matters could proceed. If, however, the two sides cannot agree, we believe that it is better that there should be no charter at all and that we should leave the matter to the two sides to sort out for themselves.
      A good deal of further anxiety has arisen in the last few weeks over the question of Press freedom and the ability of journalists to obtain information and to see that that information is conveyed to the public. The Secretary of State does not do himself justice if he ignores this problem. It is a matter which involves a definite threat to the freedom of the Press. Most journalists and members of the NUJ are as determined to maintain a free Press as is every hon. Member, but there are a number of

      1605
      journalists who seek to use their powers to control that freedom. I believe that the Barnsley case falls into that category. The NUJ intended to use its muscle to try to persuade bodies and organisations not to provide information to journalists who were not members of that union. That is certainly not a justifiable practice when applied to the freedom of the Press. There is a sharp distinction to be drawn. I am certain that the Secretary of State does not approve of those tactics, and, indeed, he said as much in a recent letter to me.
      Therefore, the right hon. Gentleman should take the Bill away again and bring in a Press charter that is enforceable. He has always refused to do this. He has refused consistently to allow the matter to be looked at by the Royal Commission on the Press as a matter of urgency. I find it rather distressing that, on what is by far the most important issue, the Royal Commission is only now taking evidence, whereas it has reported already on certain other issues affecting the Press and could easily by now have reported on this issue if it had discussed it at the right time, when we suggested it.
      The Opposition believe that the freedom of the Press is in some danger. We would have much preferred an enforceable charter to be put into the Bill. We think that the present charter with the Secretary of State mentioned in it is a wrong step for Parliament to take, and we hope very much that the Secretary of State will agree that all references to his important and honourable office should be withdrawn.
      Mr. John Page: I have been wondering what the position of the conscience of the Secretary of State would be if trade unions representing journalists did not agree in any discussions which took place as arranged under subsection (1), because, if they did not agree and if they took a very decisive line, the Secretary of State might incorporate the views which they had expressed in the charter under subsection (3)(b). In that second option, it is said that he shall incorporate in the draft charter such practical guidance on that matter as he thinks fit. As I see it, subsection (3)(b) does not require him to produce any kind of compromise solution.
      I mentioned the matter of conscience because I wanted for a moment to ques-
      1606
      tion the position of conscience in Article 9 of the European Convention on Human Rights. I have not had the opportunity of advice which I am sure the Secretary of State has taken, but I have obtained from the Library a copy of the Convention and I have read through Article 9. Nowhere in that Article do I find words which circumscribe the effectiveness of Article 9 only to matters of conscientious objection in a military sense.
      The article says:
      "Everyone has the right to freedom of thought, conscience and religion…. Freedom to manifest one's religion or beliefs shall be subject only to such limitations as are prescribed by law and are necessary in a democratic society in the interests of public safety, for the protection of public order, health or morals or for the protection of the rights and freedoms of others."
      I am not arguing whether the previous clause was in line with Article 9. I ask merely for clarification of the fact that Article 9 and the conscience clause relate only to conscientious objection to military service. I appreciate that it is a difficult matter. But I felt that, while it was fresh in my mind and I had the opportunity to mention it, I ought to take up the matter with the right hon. Gentleman.
      Mr. Foot: Perhaps I might reply first to the matter raised by the hon. Member for Harrow, West (Mr. Page). I know that this refers to the exchange which took place in our prevous debate.
      I was not saying that there was a specific reference in the Convention to the closed shop and such matters. What I said was that this whole matter of the closed shop was considered when the Convention was drawn up. As I understand the situation, when the debates occurred in preparation for the Convention, which was drawn up in 1951, and Article 11 was originally discussed in draft, the authors of the Convention decided specifically not to include a right not to associate because they were afraid that it might be held to preclude the lawful closed shop which at the time was, and still is, permitted by a number of member States. They did not want to outlaw the closed shop, and that is why they did not specifically put in the right not to associate.
      That fact illustrates what I said about the European Convention on Human Rights not being cited as evidence that

      1607
      it was intended to outlaw the closed shop in any way.
      I come, then, to the speech of the right hon. Member for Lowestoft (Mr. Prior). I do not complain about his raising this matter, and I shall seek to deal with it on its merits or demerits. But I hope he will not mind my saying that this debate is something of a parliamentary curiosity. As far as I can recall, this is the first occasion on which the Opposition have sought to remove this part from our proposed Press charter. Heaven knows, they have had opportunities beyond all calculation when this might have been done. On each previous occasion, however, they have refrained from seeing the disastrous consequences which might follow from leaving this part of the Bill untouched.
      I must say that I think it is a little late in the day for the Opposition to come up with a proposition of this nature when they have had every chance to put the argument before. Admittedly they are following in the tracks of Lord Goodman in this respect, because he originally did not describe this as being such an outrageous part of the Bill, although eventually it emerged to be the spectre which kept him awake at nights and which he was not prepared to tolerate in any circumstances. If the spectre was so horrific, one would have thought that this House, which has had perhaps a hundred opportunities to examine this Press charter, would have noticed it before. But all I say is that it is a parliamentary curiosity and that it takes the House of Lords to invoke its—I do not say "illicit" powers—
      Mr. Lee: Arcane.
      Mr. Foot: I do not think that "arcane"is the appropriate word either, because it is done in public, and "arcane" means something secret. Perhaps "archaic" is the word. In any event, the House of Lords has exerted its powers and now, at last, the matter has come back here for the right hon. Member for Lowestoft to raise. As I say, it is a parliamentary curiosity. I cannot think of any other such major matter, if it is a major matter, that has been brought up at such a late point in our proceedings.
      The right hon. Gentleman says that we should delete the part which says that, if there is a breakdown in nego-
      1608
      tiations between the parties, the Secretary of State shall be able to intervene or shall be required to intervene after a period of 12 months to see what can be done to further the creation of such a charter.
      Let me make it evident—I hope that it has been made evident before—that I want nothing to do with drawing up any such charter. I hope very much that the journalists, editors and proprietors will be able to achieve this by themselves. I am sure that this is much the best way to do it. Whatever other labours I have to undertake in the future, I hope that drawing up a charter for the Press will not figure amongst them.
      6.30 p.m.
      But I do not accept the doctrine that, because this clause is in the Bill, it will be more difficult for the parties to reach agreement. Indeed, the reason why it was inserted at all was to encourage them to make the agreement. That was why Lord Houghton originally proposed it in the House of Lords, why some of my hon. Friends urged the same and why the House of Commons agreed to the proposition on the previous occasion. Far from the retention of the clause making the achievement of a charter more difficult, I believe that it will at least assist. If the parties concerned do not reach an agreement, they will be faced with the absolute horror of the Secretary of State becoming involved. I think that that prospect would assist.
      I believe that the chances of getting a charter are improving. Some people have said they will not participate in any circumstances. For example, the editor of The Times has said that he will not participate. But two distinguished editors, the editors of the Evening Standard and The Guardian—the two best newspapers in the country—have said that they will certainly participate. I trust that most other editors will also participate. The NUJ has indicated its willingness to participate on the basis of its views on the rights of editors not to belong to unions and the form of union membership agreement that should apply to the Press. I do not say that the NUJ is committed by every statement that it has made, but it has certainly indicated the subjects which should be included in the charter and in

      1609
      the Bill itself. There are very good prospects of such a charter being accepted. I believe that it will be drawn up by people who have nothing to do with the Government, by those within the industry. That is the best way to deal with the dangers that have been described.
      The right hon. Member for Lowestoft asked whether I realised that people have genuine fears about what is happening. Of course I realise that anxieties have been expressed in the newspapers. I am not saying that they are not genuine, but I do say that they are often based on a completely false estimate of what has happened. Often they are based on a ludicrous idea of how remedies can be found. I have always said that one cannot deal with these questions by legislation. If one is forced in the last extremity to use legislation to deal with the freedom of the Press, one is in real difficulty. I want to avoid that. I have been the principal person against such legislation, and that is why we became involved in discussions on the charter.
      I hope that there will not be a repetition of the sort of language used on the subject by Lord Goodman. I strongly resented his use of the word "dictation" in relation to the powers given in the Bill to the Secretary of State. There are no powers of dictation in any sense whatever. To use that word in this context is to wrench words from their meaning. There is no attempt by the Government to dictate to the newspapers, and I hope that that charge will never be made again. Of course, when someone as eminent as Lord Goodman makes such a statement many people will believe him. But the Bill contains not one comma, phrase or sentence which justifies the suggestion that we are seeking to dictate a charter to the Press. Any such charter would have to be submitted to the Commons and the House of Lords, so I do not think that it would be a revolutionary document. It will not be something which might have been produced in times of the French Revolution. Moreover, even if the charter was drawn up and approved by both Houses it would have no sanctions. There would be no penalties in it. If someone decides that he will not obey a particular part of the charter, he will not
      1610
      be sent to the Tower of London or have the thumb-screws applied. There are no sanctions. Therefore, to talk as if we were starting a dictatorial or totalitarian process is absurd and such absurdities should not be uttered, even in the House of Lords.There are particular cases which are supposed to have given rise to the fears—for example, the Barnsley case. I have said that I think there were implications in that case for the freedom of the Press. I hope and trust that the journalists in Barnsley, and in the executive of the NUJ, will take into account what these implications might be. I emphasise that one cannot help that situation by legislation. I hope that hon. Members who think that it can be helped by legislation will take account of what was said to the Royal Commission on the Press by Charles Wintour, the editor of the Evening Standard. He illustrates his view with what happened in Barnsley. He uses stronger language than I, but his criticisms are the same. He said that it was impossible to think that one could resolve that situation by legislation. One cannot have a law which prevents some trade unionists from telling others that someone is not a member of their union or has joined another union. One cannot have a law to settle that, and one would get into difficulties if it was attempted.
      It is necessary to understand the real situation that existed in Barnsley. I am sure that the journalists concerned were not trying to undermine the freedom of the Press. They were setting out to improve their industrial situation, but they should take into account what could be the implications of what they were proposing. I am sure they will do that.
      There is another case which has not been mentioned in this part of our discussion but which was referred to by the hon. Member for Harrow, West during earlier proceedings. It is of interest because all our previous debates on Press matters have seemed to centre on the question of access to the Press and how free access is to be secured against improper industrial pressure from trade unions. That has been the argument of the Opposition, and I have always retorted that I want to protect people from improper pressures. If they are improper, they should be stopped.

      1611
      I have always said that free access to the Press is not merely a question of what trade unions do but is more a question of what editors and proprietors do. If one has a law to deal with free access to the Press, one is on shaky ground. A law of that kind starts to interfere with the rights of editors and proprietors. It would interfere with their rights more than those of journalists and trade unionists. I think that in saying that I have been a better defender of the freedom of the Press than have those who, like the right hon. Gentleman, have clamoured for an enforceable charter. That was what the right hon. Gentleman was saying. He wants a charter with legislative backing. That is what he says. I am against it because that is the real way to interfere with the freedom of the members. I am against it on those grounds.
      Let me take the example of what has happened at the Financial Times in the last day or two, to which the hon. Member for Harrow, West referred. It is an extremely interesting case. Although I deplore the action taken there, I agree with the general secretary of the National Graphical Association, who expressed his criticism of the action taken by the members of the National Graphical Association. I agree with his criticisms. The question of access here is interesting. The people who have been denied access to the Press by the action of the editor of the Financial Times are the members of the Royal Commission on the Press. The Royal Commission produced a report with some figures in it about the salaries paid to journalists as well as the wages paid to members of the National Graphical Association. The editor of the Financial Times, as I understand it, tried to cut out the reference to the salaries paid to journalists but left in the part which referred to the National Graphical Association members.
      I understand that for the union to say "We are going to apply industrial action to prevent that happening" is an interference with the editor putting in what he wants to put in. In connection with any law on access, however, one has to take into account the action of the editor of the Financial Times in suppressing what I would have thought was a very peculiar thing for him to suppress—that is, the Report of the Royal Commission
      1612
      on the Press itself. I hope that this case illustrates some of the problems.
      That does not alter the fact that it would have been better if the members of the National Graphical Association understood the implications of the action they would have taken. I think that the general secretary of the National Graphical Association has already indicated that it would have been better. His members have not taken unofficial action. I think they were provoked. We are very often provoked, and we must not retaliate when we are provoked. I hope that the members of the National Graphical Association on the Financial Times will not be provoked by the actions of the editor and will do everything in their power to ensure that the editor will be able to get his paper printed, even if he suppresses the whole of the Report of the Royal Commission on the Press, even if he is completely undiscriminating in the suppression which he wishes to carry out in that respect.
      I hope that the NGA members will continue to allow the editor to have the choice to decide on these matters until we have some different arrangement. I am not in favour of a different arrangement, because I think that it has implications for the freedom of the Press. But the right hon. Gentleman has committed himself. I know it is very late in the day, but I presume that it is an official stance. He says that he wants an enforceable charter. We are not in favour of an enforceable charter. We are in favour of an agreement between the parties. We think that that is a better way.
      Mr. Prior: It is not very late in the day. We have voted on an enforceable charter about six times in this House.
      Mr. Foot: Because he has been ill advised on previous occasions does not justify the right hon. Gentleman's persisting in the wrong advice he is giving to the House. It is not a different argument. He is arguing for an enforceable charter. The Opposition have never fully appreciated—and the more we have argued it, the better they should have understood—what are the dangers of an enforceable charter.
      We would not have an enforceable charter, for very good reasons. They are partly industrial relations issues. What Conservative Members here and the other House wanted was to have the Industrial

      1613
      Relations Act of 1971 retained in an enforceable charter and applied to one section of the community—the journalists. That would be discriminatory, provocative, counter-productive, injurious to the freedom of the Press and injurious not only to journalists but to the right of running newspapers freely in this country.
      6.45 p.m.
      The other reason has been illustrated dramatically by the Financial Times case. To say that one is to have a charter about access which is to be enforceable means that one is to have the law seeking to intervene in the most sensitive place of all—that is, on how something is to be put into the newspaper, and who decides whether it gets there. That is not a question, as the newspaper pretends, about journalists using their power or members of the National Graphical Association using their power. It is much more a question of how editors or proprietors use their power.
      I repeat what I said in the previous debate. I say it partly because of the misrepresentations of what we have been seeking to do which have been spread in so many quarters. We are not seeking to suppress freedom in any way. When people look at these debates, they will say that we have sought to sustain genuine freedom by what we have done.
      What we are seeking to do is to sustain the rights not only of people in the National Union of Journalists but of people in the industry as a whole. I believe that the result of what we have done—and we have indications from many quarters that they are prepared to do it—is to have a workable charter agreed by the people who work in the industry, not with any sanctions of the law or Parliament, not with any interference from any Secretary of State, present or future, but with something the parties have worked out freely for themselves. It is we on this side of the House who are the real defenders of the freedom of the Press, just as we are the real defenders of free trade unions.
      Mr. Brittan: We on this side of the House oppose the Secretary of State's involvement in the production of a Press charter because we think that it would be at best pointless and at worst highly
      1614
      dangerous and potentially a real, if indirect, threat to Press freedom.
      The Secretary of State has castigated the Opposition because he says that this is the first time we have sought to remove the provision in relation to a Press charter from the Bill. He is quite right that it is the first time that we seek to remove those provisions. The reason is that it is the first time that the provisions come to this House in a form in which they should be removed, if they do not have removed from them first the involvement of the Secretary of State.
      It is necessary briefly to rehearse the history of this matter, not in order to show that we have been consistent, because that would be a worthwhile but trivial objective, but rather to show that the charter which the Secretary of State is now putting forward, with his involvement or potential involvement in it, is a very different animal from the one that this House and this Opposition wanted at an earlier stage and wanted to give teeth to.
      The two important differences in the charter are, first, the question of enforceability and, secondly, the question of content. What we were saying at an earlier stage in the debate was that, if the charter contained provisions which we thought were the appropriate ones to support the freedom of the Press, we were in favour of such a charter coming into existence and we were in favour of its being enforceable. It would have been preferable if those provisions could have been agreed between the parties. If, however, Parliament laid down in advance what those provisions were, it would not matter if in the last analysis it were left to the Secretary of State, because in those circumstances the Secretary of State would not be exercising an unfettered judgment of his own as to what the contents of the charter would be, but rather he would be carrying out the wishes of Parliament in providing certain limited protections to the Press in specified situations envisaged by the legislation that Parliament will have provided.
      In these circumstances, although it would have been far better if the parties concerned could agree a charter, it would at least be tolerable to have had the hand of the Secretary of State in the matter if they failed to agree. If the Secretary of

      1615
      State operated under this parliamentary direction, he would be providing a real protection to the Press because Parliament had provided a means for him to do so.
      However, at the Government's behest, the precise provisions by which the Secretary of State would have to be guided on the charter that he would seek to impose, if it came to that, have been replaced. Instead of the precise provisions, we now have waffle, but potentially dangerous waffle. That is why we oppose the Secretary of State's involvement. If the worst comes to the worst and our amendment does not succeed, we oppose having a charter at all rather than having a charter whose contents are not laid down by Parliament and which would leave the Secretary of State the widest discretion if the parties failed to agree.
      This point can be illustrated by contrasting the provisions which we wish to have imposed in a charter with teeth and those which remain in the wishy-washy charter which the Secretary of State wishes to have the power in the last analysis to put before Parliament. As originally envisaged, the charter would have had to include, first the rights of editors and others exercising editorial responsibilities to discharge their duties free from any obligation to join a union. In other words, we were specifically providing that, even if the parties did not agree, the Secretary of State was obliged willy-nilly, to include in the charter the rights of editors and comparable people not to join a union.
      The original draft also included the rights of journalists to join a union of their choice. Therefore, if they did not want to join the NCJJ, they could join the Institute. If the Secretary of State cannot see the relevance of that to the Barnsley dispute, we can. Whether the charter is binding or not, the inclusion in it of such a provision would have tremendous moral influence in a dispute—influence which would be all the greater if, as the Secretary of State contends, the parties are reasonable people prepared to listen to reasonable arguments. It is, therefore, of interest to the Institute of Journalists, and of some concern in relation to Barnsley, that that provision was to have been included, whether the Secretary of State wanted it or not, in the charter that we favoured.
      1616
      The third provision which was to have been included was that the rights of editors to commission, publish or not to publish any article should be free from pressure by industrial action. The right of editorial freedom, which has been regarded as very much under threat, had to be included even if the Secretary of State were involved in producing the charter which we envisaged. But that has also gone.
      The fourth matter was the right of journalists not to be arbitrarily or unreasonably excluded or expelled from a union. In other words, the Secretary of State would have had to include in the charter a provision to protect journalists against unfair exclusion or expulsion. The charter which we envisaged included nothing about access, not because we thought it unimportant—I do not wish to go into the Financial Times matter, on which the Secretary of State may or may not be right—but because we thought that it should not be dealt with by legal enforcement of this kind.
      What the Secretary of State forgets is that this is a Bill about industrial relations, not about the Press, and that therefore, in seeking to protect certain sorts of Press freedom against certain threats, one is dealing not specifically with journalism but with a particular safeguard against a particular threat. With those specific rights protected, it was reasonable to ask the House to vote for a charter which the Secretary of State would have had to impose ultimately and which would have been legally binding if defied.
      But we now have a very different situation. Instead of the specific matters contained in the charter, all that is now proposed is practical guidance relating to the freedom of the Press, including the avoidance of improper pressure to distort or suppress news. The sources of the pressure and the nature of the guidance are not set out.
      The new provisions go on to say that the charter must deal with the application of union membership agreements to journalists. Under this formula the Secretary of State would be perfectly at liberty to put forward a charter requiring all journalists to belong to one union. He would not be obliged to do so, but he could do so under the Bill. It would provide also for the right of editors to

      1617
      discharge their duties and to commission and publish any article. To that we have no objection. The final reference is to access by contributors. It is in the Secretary of State's charter, not ours, that access creeps in, with all the consequent dangers.
      This is a different and much more dangerous charter, with the Secretary of State's involvement, than the one we favoured. It is hardly surprising that Lord Goodman and others have grave suspicions about the Secretary of State's involvement when it is at his behest that the particular protections and the specific rights conferred in the original charter have been eliminated in favour of a lot of potentially dangerous waffle. Lord Goodman is not crying "Wolf" but is
      raising a legitimate objection to a dangerous procedure.
      The Secretary of State says that he has no power of dictation and he pooh-poohs the very idea. He says that if the parties do not agree, he will have to come to Parliament. But if he is at the helm, Parliament will be no protection of the rights of the individual and the rights of journalists. A charter in that form, with that Secretary of State, presents real potential dangers to Press freedom. If the right hon. Gentleman will not have his involvement removed, we are much better having no charter at all.
      Question put, That the amendment to the Lords amendment be made:—
      The House divided: Ayes, 253, Noes 292.

      Division No. 93.

      AYES

      7.2 p.m.

      Adley, Robert

      Edwards, Nicholas (Pembroke)

      Hurd, Douglas

      Alison, Michael

      Elliott, Sir William

      Hutchison, Michael Clark

      Amery, Rt Hon Julian

      Emery, Peter

      Irving, Charles (Cheltenham)

      Arnold, Tom

      Fairbairn, Nicholas

      James, David

      Atkins, Rt Hon H. (Spelthorne)

      Fairgrieve, Russell

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

      Awdry, Daniel

      Farr, John

      Jessel, Toby

      Baker, Kenneth

      Fell, Anthony

      Johnson Smith, G. (E Grinstead)

      Banks, Robert

      Finsberg, Geoffrey

      Jones, Arthur (Daventry)

      Bell, Ronald

      Fisher, Sir Nigel

      Jopling, Michael

      Bennett, Sir Frederic (Torbay)

      Fletcher-Cooke, Charles

      Joseph, Rt Hon Sir Keith

      Bennett, Dr Reginald (Fareham)

      Fookes, Miss Janet

      Kaberry, Sir Donald

      Berry, Hon Anthony

      Forman, Nigel

      Kellett-Bowman, Mrs Elaine

      Bitten, John

      Fowler, Norman (Sutton C'f'd)

      Kilfedder, James

      Biggs-Davison, John

      Fox, Marcus

      King, Evelyn (South Dorset)

      Blaker, Peter

      Fraser, Rt Hon H. (Stafford & St)

      King, Tom (Bridgwater)

      Body, Richard

      Freud, Clement

      Kitson, Sir Timothy

      Boscawen, Hon Robert

      Galbraith, Hon T. G. D.

      Knox, David

      Bottomley, Peter

      Gardiner, George (Reigate)

      Lamont, Norman

      Bowden, A. (Brighton, Kemptown)

      Gardner, Edward (S Fylde)

      Lane, David

      Boyson, Dr Rhodes (Brent)

      Gilmour, Rt Hon Ian (Chesham)

      Langford-Holt, Sir John

      Braine, Sir Bernard

      Gilmour, Sir John (East Fife)

      Latham, Michael (Melton)

      Brittan, Leon

      Glyn, Dr Alan

      Lawrence, Ivan

      Brocklebank-Fowler, C.

      Godber, Rt Hon Joseph

      Lawson, Nigel

      Brotherton, Michael

      Goodhart, Philip

      Le Marchant, Spencer

      Brown, Sir Edward (Bath)

      Goodhew, Victor

      Lester, Jim (Beeston)

      Bryan, Sir Paul

      Goodlad, Alastair

      Lewis, Kenneth (Rutland)

      Buchanan-Smith, Alick

      Gorst, John

      Lloyd, Ian

      Buck, Antony

      Gow, Ian (Eastbourne)

      Loveridge, John

      Budgen, Nick

      Grant, Anthony (Harrow C)

      Luce, Richard

      Bulmer, Esmond

      Gray, Hamish

      McAdden, Sir Stephen

      Burden, F. A.

      Griffiths, Eldon

      McCrindle, Robert

      Butler, Adam (Bosworth)

      Grist, Ian

      Macfarlane, Neil

      Chalker, Mrs Lynda

      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 (Rushcliffe)

      Hampson, Dr Keith

      Madel, David

      Clegg, Walter

      Hannam, John

      Marshall, Michael (Arundel)

      Cockeroft John

      Harrison, Col Sir Harwood (Eye)

      Marten, Neil

      Cooke, Robert (Bristol W)

      Harrie Anderson, Rt Hon Miss

      Mates, Michael

      Cope, John

      Hastings, Stephen

      Mather, Carol

      Cordle, John H.

      Havers, Sir Michael

      Maude, Angus

      Corrie, John

      Hawkins, Paul

      Maudling, Rt Hon Reginald

      Costain, A. P.

      Heath, Rt Hon Edward

      Mawby, Ray

      Craig, Rt Hon W. (Belfast E)

      Heseltine, Michael

      Maxwell-Hyslop, Robin

      Crowder, F. P.

      Hicks, Robert

      Mayhew, Patrick

      Davies, Rt Hon J. (Knutsford)

      Higgins, Terence L.

      Meyer, Sir Anthony

      Dean, Paul (N Somerset)

      Holland, Philip

      Miller, Hal (Bromsgrove)

      Dodsworth, Geoffrey

      Hordern, Peter

      Mills, Peter

      Drayson, Burnaby

      Howe, Rt Hon Sir Geoffrey

      Miscampbell, Norman

      du Cann, Rt Hon Edward

      Howell, David (Guildford)

      Mitchell, David (Basingstoke)

      Durant, Tony

      Hunt, David (Wirral)

      Moate, Roger

      Eden, Rt Hon Sir John

      Hunt, John

      Monro, Hector

      Montgomery, Fergus

      Renton, Rt Hon Sir D. (Hunts)

      Stokes, John

      Moore, John (Croydon O)

      Renton, Tim (Mid-Sussex)

      Stradling Thomas, J.

      More, Jasper (Ludlow)

      Ridley, Hon Nicholas

      Tapsell, Peter

      Morgan, Geraint

      Ridsdale, Julian

      Taylor, R. (Croydon NW)

      Morris, Michael (Northampton S)

      Rifkind, Malcolm

      Taylor, Teddy (Cathcart)

      Morrison, Charles (Devizes)

      Roberts, Michael (Cardiff NW)

      Tebbit, Norman

      Morrison, Hon Peter (Chester)

      Roberts, Wyn (Conway)

      Temple-Morris, Peter

      Mudd, David

      Rodgers, Sir John (Sevenoaks)

      Thatcher, Rt Hon Margaret

      Neave, Airey

      Ross, Stephen (Isle of Wight)

      Townsend, Cyril D.

      Nelson, Anthony

      Rossi, Hugh (Hornsey)

      Trotter, Neville

      Neubert, Michael

      Rost, Peter (SE Derbyshire)

      Tugendhat, Christopher

      Newton, Tony

      Royle, Sir Anthony

      van Straubenzee, W. R.

      Nott, John

      Sainsbury, Tim

      Viggers, Peter

      Onslow, Cranley

      St. John-Stevas, Norman

      Wainwright, Richard (Colne V)

      Oppenheim, Mrs Sally

      Scott, Nicholas

      Wakeham, John

      Osborn, John

      Shaw, Giles (Pudsey)

      Walder, David (Clitheroe)

      Page, John (Harrow West)

      Shelton, William (Streatham)

      Walker, Rt Hon P. (Worcester)

      Page, Rt Hon R. Graham (Crosby)

      Shepherd, Colin

      Wall, Patrick

      Pardoe, John

      Shersby, Michael

      Walters, Dennis

      Parkinson, Cecil

      Sims, Roger

      Warren, Kenneth

      Pattie, Geoffrey

      Sinclair, Sir George

      Weatherill, Bernard

      Penhaligon, David

      Skeet, T. H. H.

      Wells, John

      Percival, Ian

      Smith, Dudley (Warwick)

      Whitelaw, Rt Hon William

      Peyton, Rt Hon John

      Speed, Keith

      Wiggin, Jerry

      Pink, R. Bonner

      Spence, John

      Winterton, Nicholas

      Price, David (Eastleigh)

      Spicer, Jim (W Dorset)

      Wood, Rt Hon Richard

      Prior, Rt Hon James

      Spicer, Michael (S Worcester)

      Young, Sir G. (Ealing, Acton)

      Pym, Rt Hon Francis

      Sproat, lain

      Younger, Hon George

      Raison, Timothy

      Stainton, Keith

      Rathbone, Tim

      Stanbrook, Ivor

      TELLERS FOR THE AYES:

      Rawlinson, Rt Hon Sir Peter

      Stanley, John

      Mr. W. Benyon and

      Rees, Peter (Dover & Deal)

      Steen, Anthony (Wavertree)

      Mr. Fred Silvester.

      Rees-Davies, W. R.

      Stewart, Ian (Hitchin)

      NOES

      Abse, Leo

      Conlan, Bernard

      Freeson, Reginald

      Allaun, Frank

      Cook, Robin F. (Edin C)

      Garrett, John (Norwich S)

      Anderson, Donald

      Corbett, Robin

      Garrett, W. E. (Wallsend)

      Archer, Peler

      Cox, Thomas (Tooting)

      George, Bruce

      Armstrong, Ernest

      Craigen, J. M. (Maryhill)

      Gilbert, Dr John

      Ashley, Jack

      Cronin, John

      Ginsburg, David

      Ashton, Joe

      Crosland, Rt Hon Anthony

      Golding, John

      Atkins, Ronald (Preston N)

      Cryer, Bob

      Gould, Bryan

      Atkinson, Norman

      Cunningham, G. (Islington S)

      Gourlay, Harry

      Bagier, Gordon A. T.

      Cunningham, Dr J. (Whiteh)

      Graham, Ted

      Barnett, Guy (Greenwich)

      Davidson, Arthur

      Grant, George (Morpeth)

      Barnett, Rt Hon Joel (Heywood)

      Davies, Bryan (Enfield N)

      Grant, John (Islington C)

      Bates, Alt

      Davies, Denzil (Llanelli)

      Grocott, Bruce

      Bean, R. E.

      Davis, Clinton (Hackney C)

      Hamilton, W. W. (Central Fife)

      Benn, Rt Hon Anthony Wedgwood

      Deakins, Eric

      Hardy, Peter

      Bennett, Andrew (Stockport N)

      Dean, Joseph (Leeds West)

      Harper, Joseph

      Bidwell, Sydney

      Delargy, Hugh

      Harrison, Walter (Wakefield)

      Bishop, E. S.

      Dell, Rt Hon Edmund

      Hart, Rt Hon Judith

      Blenkinsop, Arthur

      Dempsey, James

      Hattersley, Rt Hon Roy

      Boardman, H.

      Dormand, J. D.

      Hayman, Mrs Helene

      Booth, Rt Hon Albert

      Douglas-Mann, Bruce

      Healey, Rt Hon Denis

      Boothroyd, Miss Betty

      Duffy, A. E. P.

      Heffer, Erie S.

      Bottomley, Rt Hon Arthur

      Dunlop, John

      Horam, John

      Boyden, James (Bish Auck)

      Dunnett, Jack

      Howell, Rt Hon Denis

      Bradley, Tom

      Dunwoody, Mrs Gwyneth

      Hoyle, Doug (Nelson)

      Bray, Dr Jeremy

      Eadie, Alex

      Huckfield, Les

      Brown, Hugh D. (Provan)

      Edge, Geoff

      Hughes, Rt Hon C. (Anglesey)

      Brown, Robert C. (Newcastle W)

      Edwards, Robert (Wolv SE)

      Hughes, Mark (Durham)

      Brown, Ronald (Hackney S)

      Ellis, John (Brigg & Scun)

      Hughes, Robert (Aberdeen N)

      Buchan, Norman

      Ellis, Tom (Wrexham)

      Hughes, Roy (Newport)

      Buchanan, Richard

      English, Michael

      Hunter, Adam

      Butler, Mrs Joyce (Wood Green)

      Ennals, David

      Irvine, Rt Hon Sir A. (Edge Hill)

      Callaghan, Rt Hon J. (Cardiff SE)

      Evans, Fred (Caerphilly)

      Irving, Rt Hon S. (Dartford)

      Callaghan, Jim (Middleton & P)

      Evans, Gwynfor (Carmarthen)

      Jackson, Miss Margaret (Lincoln)

      Campbell, Ian

      Evans, loan (Aberdare)

      Janner, Greville

      Canavan, Dennis

      Evans, John (Newton)

      Jay, Rt Hon Douglas

      Cant, R. B.

      Ewing, Harry (Stirling)

      Jeger, Mrs Lena

      Carmichael, Neil

      Fernyhough, Rt Hon E

      Jenkins, Hugh (Putney)

      Carson, John

      Fitch, Alan (Wigan,

      Jenkins, Rt Hon Roy (Stechford)

      Carter, Ray

      Fill, Gerard (Belfast W)

      John, Brynmor

      Carter-Jones, Lewis

      Flannery, Martin

      Johnson, James (Hull West)

      Cartwright, John

      Fletcher, Raymond (Ilkeston)

      Johnson, Walter (Derby S)

      Clemitson, Ivor

      Fletcher, Ted (Darlington)

      Jones, Alec (Rhondda)

      Cocks, Michael (Bristol S)

      Foot, Rt Hon Michael

      Jones, Barry (East Flint)

      Cohen, Stanley

      Ford, Ben

      Jones, Dan (Burnley)

      Coleman, Donald

      Forrester, John

      Judd, Frank

      Colquhoun, Ms Maureen

      Fowler, Gerald (The Wrekin)

      Kaufman, Gerald

      Concannon, J. D.

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

      Kelley, Richard

      1620

      1621

      Kerr, Russell

      Ogden, Eric

      Spriggs, Leslie

      Kilroy-Silk, Robert

      O'Halloran, Michael

      Stallard, A. W.

      Kinnock, Nell

      O'Malley, Rt Hon Brian

      Stoddart, David

      Lambie, David

      Ovenden, John

      Stott, Roger

      Lamborn, Harry

      Owen, Dr David

      Strang, Gavin

      Lamond, James

      Padley, Walter

      Strauss, Rt Hon G. R.

      Latham, Arthur (Paddington)

      Paisley, Rev Ian

      Summerskill, Hon Dr Shirley

      Leadbitter, Ted

      Palmer, Arthur

      Swain, Thomas

      Lee, John

      Park, George

      Taylor, Mrs Ann (Bolton W)

      Lestor, Miss Joan (Eton & Slough)

      Parker, John

      Thomas, Jeffrey (Abertillery)

      Lever, Rt Hon Harold

      Parry, Robert

      Thomas, Mike (Newcastle E)

      Lewis, Ron (Carlisle)

      Pavitt, Laurie

      Thomas, Ron (Bristol NW)

      Lipton, Marcus

      Peart, Rt Hon Fred

      Thorne, Stan (Preston South)

      Litterick, Tom

      Pendry, Tom

      Tierney, Sydney

      Loyden, Eddie

      Perry, Ernest

      Tinn, James

      Luard, Evan

      Phipps, Dr Colin

      Tomlinson, John

      Lyon, Alexander (York)

      Powell, Rt Hon J. Enoch

      Torney, Tom

      Lyons, Edward (Bradford W)

      Prentice, Rt Hon Reg

      Tuck, Raphael

      Mabon, Dr J. Dickson

      Price, C. (Lewisham W)

      Urwin, T. W.

      McCartney, Hugh

      Price, William (Rugby)

      Varley, Rt Hon Eric G.

      McElhone, Frank

      Radice, Giles

      Wainwright, Edwin (Dearne V)

      Mackenzie, Gregor

      Rees Rt Hon Merlyn (Leeds S)

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

      Mackintosh, John P.

      Richardson Miss Jo

      Walker, Harold (Doncaster)

      Maclennan, Robert

      Roberts, Albert (Normanton)

      Walker, Terry (Kingswood)

      McMillan, Tom (Glasgow C)

      Ward, Michael

      McNamara, Kevin

      Roberts, Gwilym (Cannock)

      Watkins, David

      Madden, Max

      Robinson, Geoffrey

      Watkinson, John

      Magee, Bryan

      Roderick, Caerwyn

      Weetch, Ken

      Mallalieu, J. P. W.

      Rodgers, George (Chorley)

      Weitzman, David

      Marks, Kenneth

      Rodgers, William (Stockton)

      Wellbeloved, James

      Marquand, David

      Rooker, J. W.

      White, Frank R. (Bury)

      Marshall, Dr Edmund (Goole)

      Roper, John

      White, James (Pollok)

      Marshall, Jim (Leicester S)

      Rose, Paul B.

      Whitehead, Phillip

      Mason, Rt Hon Roy

      Ross, Rt Hon W. (Kilmarnock)

      Whitlock, William

      Maynard, Miss Joan

      Rowlands, Ted

      Willey, Rt Hon Frederick

      Meacher, Michael

      Sandelson, Neville

      Williams, Alan (Swansea W)

      Melllsh, Rt Hon Robert

      Sedgemore, Brian

      Williams, Alan Lee (Hornch'ch)

      Mendelson, John

      Selby, Harry

      Williams, Rt Hon Shirley (Hertford)

      Millan, Bruce

      Shaw, Arnold (Ilford South)

      Williams, Sir Thomas

      Miller, Dr M. S. (E Kilbride)

      Sheldon, Robert (Ashton-u-Lyne)

      Wilson, Alexander (Hamilton)

      Miller, Mrs Millie (Ilford N)

      Shore, Rt Hon Peter

      Wilson, William (Coventry SE)

      Molloy, William

      Short, Rt Hon E. (Newcastle C)

      Wise, Mrs Audrey

      Moonman, Eric

      Short, Mrs Renée (Wolv NE)

      Woodall, Alec

      Morris, Alfred (Wythenshawe)

      Silkin, Rt Hon John (Deptford)

      Woof, Robert

      Morris, Charles R. (Openshaw)

      Silkin, Rt Hon S. C. (Dulwich)

      Wrigglesworth, Ian

      Morris, Rt Hon J. (Aberavon)

      Sillars, James

      Young, David (Bolton E)

      Moyle, Roland

      Silverman, Julius

      Mulley, Rt Hon Frederick

      Skinner, Dennis

      TELLERS FOR THE NOES:

      Murray, Rt Hon Ronald King

      Small, William

      Mr. James Hamilton and

      Newens, Stanley

      Smith, John (N Lanarkshire)

      Mr. Peter Snape.

      Oakes, Gordon

      Spearing, Nigel

      Question accordingly negatived.
      Motion made, and Question put, That this House doth agree with the Lords in the said amendment [Mr. Foot]:—
      The House divided: Ayes 290, Noes 253.

      Division No. 94.]

      AYES

      [7.12 p.m.

      Abse, Leo

      Bottomley, Rt Hon Arthur

      Cohen, Stanley

      Allaun, Frank

      Boyden, James (Bish Auck)

      Coleman, Donald

      Anderson, Donald

      Bradley, Tom

      Colquhoun, Ms Maureen

      Archer, Peter

      Bray, Dr Jeremy

      Concannon, J. D.

      Armstrong, Ernest

      Brown, Hugh D. (Provan)

      Conlan, Bernard

      Ashley, Jack

      Brown, Robert C. (Newcastle W)

      Cook, Robin F. (Edin C)

      Ashton, Joe

      Brown, Ronald (Hackney S)

      Corbett, Robin

      Atkins, Ronald (Preston N)

      Buchan, Norman

      Cox, Thomas (Tooting)

      Atkinson, Norman

      Buchanan, Richard

      Craigen, J. M. (Maryhill)

      Bagier, Gordon A. T.

      Butler, Mrs Joyce (Wood Green)

      Cronin, John

      Barnett, Guy (Greenwich)

      Callaghan, Rt Hon J. (Cardiff SE)

      Crosland, Rt Hon Anthony

      Barnett, Rt Hon Joel (Heywood)

      Callaghan, Jim (Middleton & P)

      Cryer, Bob

      Bates, Alf

      Campbell, Ian

      Cunningham, G. (Islington S)

      Bean, R. E.

      Canavan, Dennis

      Cunningham, Dr J. (Whiteh)

      Benn, Rt Hon Anthony Wedgwood

      Cant, R. B.

      Davidson, Arthur

      Bennett, Andrew (Stockport N)

      Carmichael, Neil

      Davies, Bryan (Enfield N)

      Bidwell, Sydney

      Carson, John

      Davies, Denzil (Llanelli)

      Bishop, E. S.

      Carter, Ray

      Davis, Clinton (Hackney C)

      Blenkinsop, Arthur

      Carter-Jones, Lewis

      Deakins, Eric

      Boardman, H.

      Cartwright, John

      Dean, Joseph (Leeds West)

      Booth, Rt Hon Albert

      Clemitson, Ivor

      Delargy, Hugh

      Boothroyd, Miss Betty

      Cocks, Michael (Bristol S)

      Dell, Rt Hon Edmund

      1622

      1623

      Dempsey, James

      Kerr, Russell

      Robinson, Geoffrey

      Douglas-Mann, Bruce

      Kilroy-Silk, Robert

      Roderick, Caerwyn

      Duffy, A. E. P.

      Kinnock, Neil

      Rodgers, George (Chorley)

      Dunnett, Jack

      Lambie, David

      Rodgers, William (Stockton)

      Dunwoody, Mrs Gwyneth

      Lamborn, Harry

      Rooker, J. W.

      Eadie, Alex

      Lamond, James

      Roper, John

      Edge, Geoff

      Latham, Arthur (Paddington)

      Rose, Paul B.

      Edwards, Robert (Wolv SE)

      Leadbitter, Ted

      Ross, Rt Hon W. (Kilmarnock)

      Ellis, Tom (Wrexham)

      Lee, John

      Rowlands, Ted

      English, Michael

      Lestor, Miss Joan (Eton & Slough)

      Sandelson, Neville

      Ennals, David

      Lever, Rt Hon Harold

      Sedgemore, Brian

      Evans, Fred (Caerphilly)

      Lewis, Ron (Carlisle)

      Selby, Harry

      Evans, Gwynfor (Carmarthen)

      Lipton, Marcus

      Shaw, Arnold (Ilford South)

      Evans, loan (Aberdare)

      Litterick, Tom

      Sheldon, Robert (Ashton-u-Lyne)

      Evans, John (Newton)

      Loyden, Eddie

      Shore, Rt Hon Peter

      Ewing, Harry (Stirling)

      Luard, Evan

      Short, Rt Hon E. (Newcastle C)

      Fernyhough, Rt Hon E.

      Lyon, Alexander (York)

      Short, Mrs Renée (Wolv NE)

      Fitch, Alan (Wigan)

      Lyons, Edward (Bradford W)

      Silkin, Rt Hon John (Deptford)

      Fitt, Gerard (Belfast W)

      Mabon, Dr J. Dickson

      Silkin, Rt Hon S. C. (Dulwich)

      Flannery, Martin

      McCartney, Hugh

      Sillars, James

      Fletcher, Raymond (Ilkeston)

      McElhone, Frank

      Silverman, Julius

      Fletcher, Ted (Darlington)

      Mackenzie, Gregor

      Skinner, Dennis

      Foot, Rt Hon Michael

      Mackintosh, John p.

      Small, William

      Ford, Ben

      Maclennan, Robert

      Smith, John (N Lanarkshire)

      Forrester, John

      McMillan, Tom (Glasgow C)

      Snape, Peter

      Fowler, Gerald (The Wrekin)

      McNamara, Kevin

      Spearing, Nigel

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

      Madden, Max

      Spriggs, Leslie

      Freeson, Reginald

      Magee, Bryan

      Stallard, A. W.

      Garrett, John (Norwich S)

      Mallalieu, J. P. W.

      Stoddart, David

      Garrett, W. E. (Wallsend)

      Marks, Kenneth

      Stott, Roger

      George, Bruce

      Marquand, David

      Strang, Gavin

      Gilbert, Dr John

      Marshall, Dr Edmund (Goole)

      Strauss, Rt Hon G. R.

      Ginsburg, David

      Marshall, Jim (Leicester S)

      Summerskill, Hon Dr Shirley

      Golding, John

      Mason, Rt Hon Roy

      Swain Thomas

      Gould, Bryan

      Maynard, Miss Joan

      Taylor, Mrs Ann (Bolton W)

      Gourlay, Harry

      Meacher, Michael

      Thomas, Jeffrey (Abertillery)

      Graham, Ted

      Mellish, Rt Hon Robert

      Thomas, Mike (Newcastle E)

      Grant, George (Morpeth)

      Mendelson, John

      Thomas, Ron (Bristol NW)

      Grant, John (Islington C)

      Millan, Bruce

      Thorne, Stan (Preston South)

      Grocott, Bruce

      Miller, Dr M. S. (E Kilbride)

      Tierney Sydney

      Hamilton, James (Bothwell)

      Miller, Mrs Millie (Ilford N)

      Tinn James

      Hamilton, W. W. (Central Fife)

      Molloy, William

      Tomlinson John

      Hardy, Peter

      Moonman, Eric

      Torney, Tom

      Harper, Joseph

      Morris, Alfred (Wythenshawe)

      Tuck, Raphael

      Urwin T. W.

      Harrison, Waller (Wakefield)

      Morris, Charles R. (Opertshaw)

      Varley, Rt Hon Eric G.

      Hart, Rt Hon Judith

      Morris, Rt Hon J. (Aberavon)

      Wainwright, Edwin (Dearne V)

      Hattersley, Rt Hon Roy

      Moyle, Roland

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

      Hayman, Mrs Helene

      Mulley, Rt Hon Frederick

      Walker, Harold (Doncaster)

      Healey, Rt Hon Denis

      Murray, Rt Hon Ronald King

      Walker, Terry (Kingswood)

      Heffer, Eric S.

      Newens, Stanley

      Ward, Michael

      Horam, John

      Oakes, Gordon

      Watkins, David

      Howell, Rt Hon Denis

      Ogden, Eric

      Watkinson, John

      Hoyle, Doug (Nelson)

      O'Halloran, Michael

      Weetch, Ken

      Huckfield, Les

      O'Malley, Rt Hon Brian

      Weitzman, David

      Hughes, Rt Hon C. (Anglesey)

      Ovenden, John

      Wellbeloved, James

      Hughes, Mark (Durham)

      Owen, Dr David

      White, Frank R. (Bury)

      Hughes, Robert (Aberdeen N)

      Padley, Walter

      White, James (Pollok)

      Hughes, Roy (Newport)

      Paisley, Rev Ian

      Whitehead, Phillip

      Hunter, Adam

      Palmer, Arthur

      Whitlock, William

      Irvine, Rt Hon Sir A. (Edge Hill)

      Park, George

      Willey, Rt Hon Frederick

      Irving, Rt Hon S. (Dartford)

      Parker, John

      Williams, Alan (Swansea W)

      Jackson, Miss Margaret (Lincoln)

      Parry, Robert

      Williams, Alan Lee (Hornch'ch)

      Janner, Greville

      Pavitt, Laurie

      Williams, Rt Hon Shirley (Hertford)

      Jay, Rt Hon Douglas

      Peart, Rt Hon Fred

      Williams, Sir Thomas

      Jeger, Mrs Lena

      Pendry, Tom

      Wilson, Alexander (Hamilton)

      Jenkins, Hugh (Putney)

      Perry, Ernest

      Wilson, William (Coventry SE)

      Jenkins, Rt Hon Roy (Stechford)

      Phipps, Dr Colin

      Wise, Mrs Audrey

      John, Brynmor

      Powell, Rt Hon J. Enoch

      Woodall, Alec

      Johnson, James (Hull Weal)

      Prentice, Rt Hon Reg

      Woof, Robert

      Johnson, Waller (Derby S)

      Price, C. (Lewisham W)

      Wrigglesworth, Ian

      Jones, Alec (Rhondda)

      Price, William (Rugby)

      Young, David (Bolton E)

      Jones, Barry (East Flint)

      Redice, Giles

      Jones, Dan (Burnley)

      Rees, Rt Hon Merlyn (Leeds S)

      TELLERS FOR THE AYES:

      Judd, Frank

      Richardson, Miss Jo

      Mr. J, D. Dormand and

      Kaufman, Gerald

      Roberts, Albert (Normanton)

      Mr. John Ellis.

      Kelley, Richard

      Roberts, Gwilym (Cannock)

      NOES

      Adley, Robert

      Awdry, Daniel

      Bennett, Dr Reginald (Fareham)

      Alison, Michael

      Baker, Kenneth

      Benyon, W.

      Amery, Rt Hon Julian

      Banks, Robert

      Berry, Hon Anthony

      Arnold, Tom

      Bell, Ronald

      Biffen, John

      Atkins, Rt Hon H. (Sperthorne)

      Bennett, Sir Frederic (Torbay)

      Biggs-Davison, John

      1624

      1625

      Blakef, Peter

      Heath, Rt Hon Edward

      Pardoe, John

      Body, Richard

      Heseltine, Michael

      Parkinson, Cecil

      Boscawen, Hon Robert

      Hicks, Robert

      Pattie, Geoffrey

      Bottomley, Peter

      Higgins, Terence L.

      Penhaligon, David

      Bowden, A. (Brighton, Kemptown)

      Holland, Philip

      Percival, Ian

      Boyson, Dr Rhodes (Brent)

      Hordern, Peter

      Peyton, Rt Hon John

      Braine, Sir Bernard

      Howe, Rt Hon Sir Geoffrey

      Pink, R. Bonner

      Brittan, Leon

      Howell, David (Guildford)

      Price, David (Eastleigh)

      Brocklebank-Fowler, C.

      Hunt, David (Wirral)

      Prior, Rt Hon James

      Brotherton, Michael

      Hunt, John

      Pym, Rt Hon Francis

      Brown, Sir Edward (Bath)

      Hurd, Douglas

      Raison, Timothy

      Bryan, Sir Paul

      Hutchison, Michael Clark

      Rathbone, Tim

      Buchanan-Smith, Alick

      Irving, Charles (Cheltenham)

      Rawlinson, Rt Hon Sir Peter

      Buck, Antony

      James, David

      Rees, Peter (Dover & Deal)

      Budgen, Nick

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

      Rees-Davies, W. R.

      Bulmer, Esmond

      Jessel, Toby

      Renton, Rt Hon Sir D. (Hunts)

      Burden, F. A.

      Johnson Smith, G. (E Grinstead)

      Renton, Tim (Mid-Sussex)

      Butler, Adam (Bosworth)

      Jones, Arthur (Daventry)

      Ridley, Hon Nicholas

      Chalker, Mrs Lynda

      Jopling, Michael

      Ridsdale, Julian

      Churchill, W. S.

      Joseph, Rt Hon Sir Keith

      Rifkind, Malcolm

      Clark, Alan (Plymouth, Sutton)

      Kaberry, Sir Donald

      Roberts, Michael (Cardiff NW)

      Clark, William (Croydon S)

      Kellett-Bowman, Mrs Elaine

      Roberts, Wyn (Conway)

      Clarke, Kenneth (Rushcliffe)

      Kershaw, Anthony

      Rodgers, Sir John (Sevenoaks)

      Clegg, Walter

      Kilfedder, James

      Ross, Stephen (Isle of Wight)

      Cockcroft, John

      King, Evelyn (South Dorset)

      Rossi, Hugh (Hornsey)

      Cooke, Robert (Bristol W)

      King, Tom (Bridgwater)

      Rost, Peter (SE Derbyshire)

      Cope, John

      Kitson, Sir Timothy

      Royle, Sir Anthony

      Cordle, John H.

      Knox, David

      Sainsbury, Tim

      Costain, A. P.

      Lamont, Norman

      St. John-Stevas, Norman

      Craig, Rt Hon W. (Belfast E)

      Lane, David

      Scott, Nicholas

      Crowder, F. P.

      Langford-Holt, Sir John

      Shaw, Giles (Pudsey)

      Davies, Rt Hon J. (Knutsford)

      Latham, Michael (Melton)

      Shelton, William (Streatham)

      Dean, Paul (N Somerset)

      Lawrence, Ivan

      Shepherd, Colin

      Dodsworth, Geoffrey

      Lawson, Nigel

      Shersby, Michael

      Drayson, Burnaby

      Le Marchant, Spencer

      Silvester, Fred

      du Cann, Rt Hon Edward

      Lester, Jim (Beeston)

      Sims, Roger

      Durant, Tony

      Lewis, Kenneth (Rutland)

      Sinclair, Sir George

      Eden, Rt Hon Sir John

      Lloyd, Ian

      Skeet, T. H. H.

      Edwards, Nicholas (Pembroke)

      Loveridge, John

      Smith, Dudley (Warwick)

      Elliott, Sir William

      Luce, Richard

      Speed, Keith

      Emery, Peter

      McAdden, Sir Stephen

      Spence, John

      Fairbairn, Nicholas

      McCrindle, Robert

      Spicer, Jim (W Dorset)

      Fairgrieve, Russell

      Maclarlane, Neil

      Spicer, Michael (S Worcester)

      Farr, John

      MacGregor, John

      Sproat, lain

      Fell, Anthony

      Macmillan, Rt Hon M. (Farnham)

      Stainton, Keith

      Finsberg, Geoffrey

      McNair-Wilson, M. (Newbury)

      Stanbrook, Ivor

      Fisher, Sir Nigel

      McNair-Wilson, P. (New Forest)

      Stanley, John

      Fletcher-Cooke, Charles

      Madel, David

      Steen, Anthony (Wavertree)

      Fookes, Miss Janet

      Marshall, Michael (Arundel)

      Stewart, Ian (Hitchin)

      Forman, Nigel

      Marten, Neil

      Stokes, John

      Fowler, Norman (Sutton C'f'd)

      Mates, Michael

      Stradling Thomas, J.

      Fox, Marcus

      Maude, Angus

      Tapsell, Peter

      Fraser, Rt Hon H. (Stafford & St)

      Maudling, Rt Hon Reginald

      Taylor, R. (Croydon NW)

      Freud, Clement

      Mawby, Ray

      Taylor, Teddy (Cathcart)

      Galbraith, Hon T. G. D.

      Maxwell-Hyslop, Robin

      Tebbit, Norman

      Gardiner, George (Reigate)

      Mayhew, Patrick

      Temple-Morris, Peter

      Gardner, Edward (S Fylde)

      Meyer, Sir Anthony

      Thatcher, Rt Hon Margaret

      Gilmour, Rt Hon Ian (Chesham)

      Miller, Hal (Bromsgrove)

      Townsend, Cyril D.

      Gilmour, Sir John (East Fife)

      Mills, Peter

      Trotter, Neville

      Glyn, Dr Alan

      Miscampbell, Norman

      Tugendhat, Christopher

      Godber, Rt Hon Joseph

      Mitchell, David (Basingstoke)

      van Straubenzee, W. R.

      Goodhart, Philip

      Moate, Roger

      Viggers, Peter

      Goodhew, Victor

      Monro, Hector

      Wakeham, John

      Goodlad, Alastair

      Montgomery, Fergus

      Walder, David (Clitheroe)

      Gorst, John

      Moore, John (Croydon C)

      Walker, Rt Hon P. (Worcester)

      Gow, Ian (Eastbourne)

      More, Jasper (Ludlow)

      Wall, Patrick

      Grant, Anthony (Harrow C)

      Morgan, Geraint

      Walters, Dennis

      Gray, Hamish

      Morris, Michael (Northampton S)

      Warren, Kenneth

      Griffiths, Eldon

      Morrison, Charles (Devizes)

      Weatherill, Bernard

      Grist, Ian

      Morrison, Hon Peter (Chester)

      Wells, John

      Grylls, Michael

      Mudd, David

      Whitelaw, Rt Hon William

      Hall, Sir John

      Neave, Airey

      Wiggin, Jerry

      Hall-Davis, A. G. F.

      Nelson, Anthony

      Winterton, Nicholas

      Hamilton, Michael (Salisbury)

      Neubert, Michael

      Wood, Rt Hon Richard

      Hampson, Dr Keith

      Newton, Tony

      Young, Sir G. (Ealing, Acton)

      Hannam, John

      Nott, John

      Younger, Hon George

      Harrison, Col Sir Harwood (Eye)

      Onslow, Cranley

      Harvie Anderson, Rt Hon Miss

      Oppenheim, Mrs Sally

      TELLERS FOR THE NOES

      Hastings, Stephen

      Osborn, John

      Mr. Carol Mather and

      Havers, Sir Michael

      Page, John (Harrow West)

      Mr. John Corrie.

      Hawkins, Paul

      Page, Rt Hon R. Graham (Crosby)

      Question accordingly agreed to.
      Remaining Lords amendment agreed to.
      Committee appointed to draw up a Reason to be assigned to the Lords for disagreeing to one of their amendments to the Bill: Mr. Booth, Mr. Brittan, Mr. Thomas Cox, Mr. Secretary Foot and Mr. Prior; Three to be the quorum.—[Mr. Foot.]
      To withdraw immediately.
      Reason for disagreeing to one of the Lords amendments reported, and agreed to; to be communicated to the Lords.

CONSOLIDATED FUND (No. 2) BILL
Order for Second Reading read.
Motion made, and Question proposed, That the Bill be now read a Second time.

DEFENCE PROCUREMENT (AIR SYSTEMS)
7.24 p.m.
Mr. Ronald Brown: I wish to raise an item under Class I, Vote 10 of the Supplementary Estimates dealing with defence procurement and air systems, but there are some preliminary comments I wish to make first.
I have no interest to declare in any companies, firms or contractors. My interest in this matter arises solely from my membership of the Western European Union and my continuing interest in technology, avionics and air systems. My concern has been about the quality of the weapons systems for the multi-role combat aircraft and its success as a European aircraft.
I am aware, and so is my right hon. Friend, that the hon. Member for Hastings (Mr. Warren) and my noble Friend, Lord George-Brown, have been concerned with a company in Hastings which was unsuccessful in its tender. I am not concerned with that argument, and I have not been concerned with it. The Secretary of State sent a letter to Lord George-Brown on 6th February and was courteous enough to send me a copy, since I had been speaking to him on some other matters. However, I did not request the letter and I wish to make it
1628
abundantly clear that it is not part of my inquiry.
It is more in sorrow than in anger that I have sought this debate. I am a supporter of the MRCA. It is a first-class aircraft and weapons system. I became concerned when I heard that Herr Eichorn was unhappy about the situation in relation to the project. I asked the Secretary of State if he would allow me an unofficial contact with him and his procurement advisers to discuss in private the sort of thing I have been driven now to discuss in public. I very much regret his decision. I would have been far happier if I had had the privilege and courtesy of being allowed to discuss this matter in what I regard as the proper place.
In 1971–72 tenders were sought for a number of contracts, and specifications were sent to suitably qualified firms. I believe procurement is always subject to what I euphemistically call a "carve-up", particularly by the big boys in the industry. In certain fields, the heavyweights carry a lot of muscle. Procurement becomes more like "Buggins' Turn". This is not peculiar to this country; it happens in every international sphere in which I have worked. In this case, everything appears to have run true to form.
The Muhammad Ali of the electronics industry is GEC-Marconi-Elliott. Sir Arnold Weinstock is in the corner of this great Muhammud Ali. It had earmarked for itself the main computer contract. This was a contract well worth having and, if the information I have received is correct, the company's documentation was very full. To keep the game looking good, the company put in for other contracts, but with very slender documentation and in some cases at absurd prices, mainly because it had neither the knowledge nor interest in any of the other contracts. Because it was so large, it expected to win the main contract.
A German firm—Litef—was expected to get the inertia navigation system contract, but it was at this point we got the first switch. Litef was given the main computer contract and Ferranti got the inertia navigation system. Smiths, as anticipated, was given the head-up display contract. This caused problems, because Plessey anticipated getting the stores management system contract and had put in

1629
a remarkably good bid at very competitive prices, as did some other organisations and firms, because they were competent in the field and they wanted the work. They could do the work, but the giant itself—the GEC-Marconi-Elliott group—put in a holding bid with very thin supporting data and a very silly price to boot—about half the cost put in by everybody else.
I have had to work out the figures, changing them from deutschemarks to sterling. My hon. Friend knows how difficult this is, bearing in mind how the pound has been floating recently.
The company was not competent, on the one hand, and on the other hand it did not want the job, thinking that it would get the main contract. The company failed to get the main contract, and this is where "Buggins' turn" comes into it. In view of its weight and muscle, it had to be given something—therefore it was given the stores management system, or weapons delivery system, in spite of its very silly tender.
From 1972 to 1974 the company struggled manfully—I do not know whether Sir Arnold was helping it—to deliver the goods in this very vital area of weapons delivery systems. To help it the company was given about £1 million pounds of development money.
At that point I began to get so edgy that I put a Question to my right hon. Friend the Secretary of State about the public funds being used to develop the weapons control system of the multi-role combat aircraft. I asked who authorised the payment and who monitored the expenditure. The answer I received was:
"Development of a weapon control system is an element of the MRCA weapon system development programme which is being jointly funded by Britain, Germany and Italy. Work has been monitored and paid for in accordance with the conditions of the contract."—[Official Report, 5th March 1975; Vol. 906, c. 761.]
We still have not been told, therefore, what money the company was getting and how it was getting it. I asked the Secretary of State, in a further question, to tell me the tender price and who were the tenderers. I was not told the price of the tenders but I was told that the successful tenderer was Marconi-Elliott. I was not able to get from my right hon. Friend the information I was seeking
1630
as to how much development money had gone to this company between 1972 and 1974 to help it in its struggle to provide this weapons delivery system.
By then it had become obvious to the eagle eye of the Ministry of Defence Procurement Director that the company was beginning to flounder seriously, because of the falling back in the time scale. It was clear that although the development of the MRCA was going ahead on a full compatability basis, which is exactly what it was designed to do, the weapons system being developed by Marconi-Elliott was a complete flop. This was in spite of the fact that the company had £1 million to help it find an answer.
We now come to the second switch. As Marconi-Elliott was unable to produce a weapons system which would fit in the space allowed for it on the aircraft, it was apparently decided by the Procurement Executive to give some relaxation. This relaxation was introduced into the specification in order to allow more room for the weapons system, as the company was unable to manufacture a system within the specified parameters.
The weapons programming unit, which is the real computer heart of the system, I am advised, is now to be contained in two boxes instead of one. This means added weight, and no doubt re-wiring. The overall effect is to make the aircraft more difficult to operate, and therefore more vulnerable in the event of attack. That is quite apart from the extra cost involved. As a further result of the company's incompetence, more room has had to be provided for the decoder units which hang underneath the wing of the aircraft. I believe that there are eight of these.
As a result of these artificially contrived design changes in the specification, the Ministry of Defence decided to ask for tenders again in 1975, claiming that it now had a different specification and therefore ought to go round the mill once more, after wasting three years. The management systems contract was therefore put out to tender on this revised specification.
By now the German partners were feeling frustrated beyond belief at the incompetence of Marconi-Elliott, but went along with the re-tendering because the MRCA was itself going ahead. But

1631
the Germans made it clear that there would be no more German money to go into Marconi-Elliott. The House will recall that expenditure on the MRCA project is shared in the proportion of 42£ per cent, by the United Kingdom and Germany, and 15 per cent. by Italy, the third partner.
I understand that the official reason of the Ministry of Defence for re-tendering was that a more simplified system would not only reduce the cost but would be more suitable in operation.
To convert that statement into simple language, the Ministry of Defence was saying, in effect, that it had reduced the weapon-carrying capability of the MRCA because Marconi-Elliott was unable to design the switch device to select weapons that need a lot of power. That is what was meant by the Ministry of Defence in the rather trite terms that were used.
The irony of the whole story, as I understand it from what I have heard on the other side, is that all the other bidders could have done the job as originally specified, and would have required no form of relaxation at all.
Now we come to what I regard as a piece of supreme folly, notwithstanding all that has gone before, as I have described it to the House. One can still hardly believe it, but the Secretary of State has again chosen GEC-Marconi-Elliott to have the contract for this weapons system. This was too much for our German friends. They could no longer put up with the situation.
The most disastrous aspect of all is that the Germans have now gone to an American firm. What we were hoping would be for the first time an all-European aircraft has, due to the absurdity of my right hon. Friend, become something quite different, with the Americans involved in a major part of the aircraft. The Germans have said quite clearly that they do not wish to be associated with the British company. They do not trust Marconi-Elliott to produce a satisfactory weapons system for the MRCA. The Germans also resented what they felt was a subtle change in the specification.
I tried very hard to get the information from my right hon. Friend, but he was not forthcoming. He stated that there
1632
was no change in the integrity and safety requirements of the system.
I understand that the subtlety of the change is related to what determines the fail-safe situation, which is of vital importance. This is why the whole system had to be duplicated—in order to make sure that there could never be a failure. It had to fail safe.
It was stipulated—I am only paraphrasing—that a single system failure must not cause any inadvertent release. I understand that the procurement officers have added some words so that it now reads:
"wherever possible any single system failure must not cause any inadvertent release".
By adding the two simple words "wherever possible" Marconi-Elliott has been let off the hook, because it could not do it. When I think of these aircraft flying over my constituency under these circumstances I am a little worried if my hon. Friend does not plan to do something about it.
I asked the Secretary of State, in a Written Question,
"if the integrity and safety of the weapons control system of the multi-role combat aircraft have been altered by upgradng or downgrading; when such changes took place; what were the costs involved; who authorised the changes; and for what reasons they took place."
My hon. Friend answered:
"The integrity and safety requirements of the weapons control system for the MRCA have not been altered."—[Official Report. 5th March 1976; Vol. 906, c. 761.]
In my view it is outrageous to give a reply of that nature. I think that that is an important element, which my hon. Friend and I might discuss elsewhere.
The Germans have gone ahead with their contract to an American company to produce a safe weapons system for their own MRCA. So much for European compatibility. That means that our weapons system will be different from the Germans' and therefore they will not marry up at any time. We now have virtually two aircraft, which is exactly what we did not want.
I could not understand why these changes had taken place and, like many other hon. Members, I began to think about it. I sought information on how many serving Royal Air Force officers

1633
who were negotiating contracts with this firm had left the Service and gone to work for that firm within two years. I received a straightforward answer from my hon. Friend telling me
"There have been five requests in that category"—
that is from squadron leader and above—
"All were granted, in 1971, 1972, 1973 (two) and 1975."—[Official Report, 8th March 1976; Vol. 907, c. 47.]
I turn to the third switch. Having authorised the contract which, according to the Ministry of Defence procurement officers would reduce the costs—in fact the bid by Marconi was substantially higher for apparently less work—the firm set about getting itself out of trouble. First of all it subcontracted the most difficult and sophisticated part of the weapons system—the Pylon Decoder Unit—to a small Italian firm called Selenia. Its only claim to fame was that it had been part of a much larger organisation in which the top man had just had to resign because of charges of corruption. He has been notified that he is to be pursued for corruption.
This firm has been identified as a classic example of making corrupt payments in connection with an order for radar equipment by the Italian Air Force. In the light of the information which I had sent my hon. Friend in my letter, I asked him whether he was satisfied about authorising a subcontract to such a firm. He wrote back in his usual way telling me how glad and satisfied he was to authorise such a payment to such a firm. I found it extraordinary that he was able to do so, but nevertheless this is the firm to which Marconi-Elliott gave the most risky and difficult part of the weapons system.
We now come to the fourth switch. As everyone on the Continent knows, Selenia cannot do the work. It has neither the capability nor the know-how. Moreover, it is a very suspect type of company, anyway. It is now going to every company in Britain finding out who it can possibly get to do the work. I am told that it has had a number of "goes" and that at present Lucas Industries is taking an interest in the matter. I received a paper from that organisation today.
1634
When talking about its aerospace industry it says that it deals with gas turbine engines, fueling, combustion components, flight control, electrical generator systems, de-icing equipment, actuators—and then it says "et cetera". I gather that this piece of important work would come under the item "et cetera".
Therefore, it is manfully attempting to "have a go" at developing a very complicated power system that should never have been required in the first place if the contractor who won the contract had had the capability and expertise for doing it.
We could go on for a long time discussing the appalling saga of this fine aircraft. Now the prototype of the MRCA is ready for flight tests—or it will be very soon. The House will not be surprised to know that flight tests will have to take place without the weapons system being tested, because there is no weapons system to test. How much will it cost to simulate the weapons system? Who will pay for that added cost? Is it an on-cost that Marconi-Eliott will add, or will Selenia or Lucas pay for it? I ask my hon. Friend to tell me. How will they test the weapons system when the prototype is undergoing flight tests in order to make sure that they are flight testing the real article and not leaving half of the equipment behind? Perhaps they will throw out "pineapples".
I am led to believe that the Germans are pouring out large sums of money to the United States contractors in order to get the results as quickly as possible, because they have been let down. How much shall we pour in? When we have poured it in, how late shall we leave it before getting the weapons system? When does my hon. Friend expect it to be available for testing?
In view of the events that I have briefly outlined, does not my hon. Friend believe that there is something radically wrong with the advice he is getting from his procurement department? What we have seen is an absolute disgrace. Will he immediately look at the way in which he and his right hon. Friend are getting advice? Is he satisfied with the ease with which one makes the transition from being paid by one's Department to negotiate with a contractor to joining the

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contractors' firm in order to negotiate back with the friends whom one has left behind? Does he not regard that as a little too easy for comfort?
I have no knowledge of the contractors who tendered generally, but I am advised that they were competent. Why should Selenia be obliged to go hawking round the country?
I urge my right hon. Friend to move in and ensure that one of these companies is given part of the work so that we may get the weapons system we are entitled to expect. Will he also consider whether, in future, it might be more advantageous both to the Alliance and to this country if he occasionally took time out to talk to his Back Benchers?
7.50 p.m.
Mr. Robin F. Cook: I am happy to begin by echoing the fact that I, too, have no interest in any of the companies associated with the MRCA programme, although it would come as a surprise to hon. Members, I am sure, if they learnt that I received any remuneration from any of the defence industries.
I congratulate my hon. Friend the Member for Hackney, South and Shore-ditch (Mr. Brown) on having contrived this debate on the project tonight. It gives the House the opportunity to discuss the Government's decision a fortnight ago to confirm the order for the full project, an order upon which they will spend £2,000 million of public expenditure over the coming years and which will be the largest item under this part of the Consolidated Fund for many years. I appreciate the manner in which my hon. Friend pursued his constituency point with considerable tenacity. I am grateful, too, for his comments on the project, and I shall take care to read his speech again in Hansard.
I propose to deal with the subject in more general terms with expenditure on the aircraft—the Tornado, as it seems we will have to learn to call it. It is only three hours since I learned that there would be an opportunity to debate this issue, and I am therefore not as well prepared as I would wish. I shall be putting some detailed points to the Minister which he may not wish to deal with at this stage, and I will understand if he prefers to reply later in writing.
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The timing of the announcement a fortnight ago was, perhaps, rather unfortunate. I recollect that it was made on 6th March. On 29th February this House ordered to be printed the Second Report from the Expenditure Committee which dealt with the defence review and which included a section dealing with the MRCA. I shall quote a paragraph in that Report which expresses the doubts and reservations of the Defence Sub-Committee of the Expenditure Committee about the MRCA. It said
"In the light of the evidence given, and taking account of information published elsewhere (e.g., in United States Defense Department Reports), we are not yet convinced that the ADV of the MRCA is the right choice for air defence of the United Kingdom and for service with RAF Germany)."
It continues, in the same paragraph:
"We therefore echo the recommendation of the 1973–74 Expenditure Committee that there should be a most stringent review of the air defence requirement, and of all the means by which it might be met, before substantial expenditure is committed either on the ADV of the MRCA or on a high performance fighter aircraft."
I can only say that it was unfortunate that eight days after the Report was presented to the House, and before the House had had the opportunity to debate the Report, before the Government had published their observations on the comments and recommendations of the Report, they should have proceeded with a decision which over-rode the reservations I have just quoted. Since the Government appear quite confident that they can meet the doubts expressed by the Committee, they have presumably considered the Report and prepared their reply. When may we expect to receive their observations on the Report? Since the decision to confirm the order has been made, the sooner we receive those observations on why they rejected the paragraph, the more it will help the House.
My second point concerns the cost of the project. Will my right hon. Friend the Minister clarify some of the points made to the Press at the time of the announcement? I noticed that the figure of £5·3 million per unit production cost was quoted in the Press. That seems to be a rapid escalation from the £3·9 million given to the Expenditure Committee in July last year and as quoted in the Expenditure Committee's Report. Will my right hon. Friend clarify what this

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figure includes? Does it exclude the cost of spares and ground equipment, which is included in the standard presentation of the costs of the German aircraft to the German Parliament? If it does, does my right hon. Friend accept that, on the basis of the German figures, the cost of ground equipment and spares is about 50 per cent. of unit production costs? If so, is it not realistic to estimate that each aircraft will cost £8 million rather than £5·5 million?
Will my right hon. Friend confirm that these figures, irrespective of what they include or exclude, are based on 1974 prices? If so, it would be helpful to have updated figures. I understand the difficulties of updating costs to keep pace with inflation, but with the rapid rate of inflation over the last 15 months it does not help the House or the Expenditure Committee to have to reach decisions based on figures at 1974 levels.
There is the issue of the air defence variant. It will cost £1 million more per aircraft than the common version. All hon. Members would expect that, if any part of the project was likely to be revised or cancelled, it would be the version which is unique to Britain, which has its own technological problems and is the more expensive of the two. The Economist said at the time of the announcement:
"For interception, the American F-15 could not only be bought off the shelf for at least £lm a copy less but is also designed from the start as a fighter aircraft".
I was surprised to note that reservation in a journal as reputable and with as good connections as The Economist, but that sentence goes to the heart of the matter. We are here concerned not only with costs but with performance. There have been suggestions that the rôle of the air defence variant is in conflict with some of the rôles of the common version and that it is not easy to combine the interception rôle with the interdiction rôle.
I was a member of the Committee which a year ago met representatives of the British Aircraft Corporation who came to discuss with us the four-nation project when four nations were proposing to buy a common plane. Sadly, we know that BAC failed to win any contract or order associated with that order. BAC,
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however, submitted a memorandum and I was struck by the fact, in considering the requirements of the four nations, that BAC had come to the conclusion that it would be better to have two separate planes than one common multi-role version.
In its memorandum, BAC said:
"BAC is still firmly convinced that its proposed 'two-type' solution, i.e. the low-level strike/attack/reconnaissance Jaguar and a specialised high altitude interceptor fighter, offers the best answer to the problem, on military, economic and political grounds."
The memorandum continued:
"In order to provide the F.1 or the F-16 with a low level strike capability, which is not required by either the French or US Air Forces, long and expensive development programmes would be necessary, paid for largely by the taxpayers of the four countries. This would possibly result in degradation of their high level interceptor performance, and probably produce a low level capability inferior to that of the Jaguar, which is already proven and on which the development costs have already been paid."
I appreciate that the memorandum was produced for a given situation which was different from the situation which MRCA will meet, because it will be used in a different rôle and at a different location However, much of these comments appears to have a common general application and truth.
If BAC believes it to be so difficult to produce a common version to meet the rôles required by the four nations, it is difficult not to see the same problems in adapting the common version to a unique British defence variant. It is difficult not to believe that the adaptation may not also prove expensive and degrade the capacity of the plane in its other version.
My fourth issue is the one that concerns me most. If my right hon. Friend the Minister of State can help me on this matter tonight, the debate will have been worth while. There has been speculation in the Press lately that some £400 million is to be spent over the next three years on improving the British nuclear deterrent. Those figures have not been confirmed by the Government neither have they yet been denied. It is difficult to believe that money of that magnitude would be spent on improving a nuclear deterrent based on the Polaris submarine, on a missile system which can have only a limited life and in particular on submarines with an even more limited life—possibly only a further five to ten years. If money of

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that magnitude is to be spent, it can only be intended to adapt a nuclear deterrent to another form of delivery.
Therefore, I was particularly interested in an article published in the Daily Telegraph on 1st March this year by Air Commodore E. M. Donaldson, who, I assume, is well connected, which said:
"Optimists see the aircraft (MRCA) as capable eventually of being used in the nuclear deterrent rôle, able to deliver H-bombs to Moscow, although this rôle is being kept in low key for the time being."
I should not have thought that it was keeping it in low key to publish it in the Daily Telegraph, but if that was at the back of the Government's mind I can understand why they wish to keep it in a low key.
Not only has the Daily Telegraph spoken in this fashion, but in the same article I quoted from the Economist the MRCA was referred to as having a "long-range nuclear strike" rôle. That is particularly distressing. Only the other week my right hon. Friend the Secretary of State categorically denied that Britain was developing a second-generation nuclear deterrent. I hope that when my right hon. Friend replies he will repeat that denial with specific reference to the MRCA.
The suggestion advanced lately that the MRCA may take over the function of Polaris in providing a nuclear deterrent is very distressing, particularly if it is related to a short-range attack missile or to a cruise missile which involves real difficulties over arms control and leads us into a more tense and fragile international situation in which it would be more difficult to achieve agreement on observation and disarmament.
The last point that I wish to raise relates to the major doubts that have been expressed about whether we should go ahead at this point in history with such an expensive programme to produce a manned aircraft. It has been suggested that we could fulfil that rôle with a surface-to-air missile more cheaply and that its effectiveness would not be much less. This suggestion has been made with particulr reference to the air defence variant.
The argument was presented at some length in the previous Report of the Expenditure Committee two years ago.
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When the Government presented their observations on that Report two years ago, they did not give any argument against the suggestion that missiles could fulfil the rôle of manned aircraft. I have been unable to lay my hands on those observations, but, as I recollect them, the Government answered with only one sentence. They said that those arguments would be borne in mind when the decision was made. However, no arguments have surfaced publicly. Nothing has been said in public about why the option of a surface-to-air missile rather than an air defence variant has been rejected.
I hope the House will note the Press sources which I quote today are of impeccable impartiality. Last week, after the confirmation of the order, an article in the Financial Times referring to the suggestion that surface-to-air missiles could be used as a substitute said:
"Mr. Mason said on Friday that all these doubts had now been cleared up, but he has yet to explain how."
The House is entitled to some explanation of the "how" and of what the arguments are that have been used to reject the surface-to-air missile operation. In particular, we are entitled to know how since we face a spiralling cost of manned aircraft which is common to other nations of the West and in the advanced world generally.
It has been estimated in the United States that if the escalation in costs of manned aircraft for the air force continues at the same rate as in the past 15 years, 50 years from now the United States will be able to buy only one plane per year for its air force by using its entire defence budget, and by the end of this century it will be able to maintain that only by allocating its entire GNP to aircraft procurement. Such extrapolation is preposterous and will never happen, but it illustrates that we cannot go on producing manned aircraft at the escalating costs of the past decade. In particular, we cannot do it at a time when aircraft are becoming increasingly vulnerable to precision-guided missiles which can be produced at one-hundredth of the cost of the aircraft they destroy.
This is not a new debate. It was raised in the 1957 White Paper of a Conservative Government, which said that

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the manned aircraft then being constructed would be the last generation of manned aircraft and that subsequently missiles would fulfil the role of manned aircraft. It is now 20 years later, and we should have more information about the debate which has presumably gone on within the Government.
I am not an expert on these matters and am in no position to judge the relative merits. It may be that there are weighty arguments in favour of maintaining manned aircraft and rejecting surface-to-air missiles. All I am saying is that at least we are entitled to know these arguments when we are faced with an expenditure of this magnitude, which will commit a high proportion of the procurement expenditure of the defence budget for about the next five to seven years.
8.9 p.m.
Mr. David Walder: I should like to encourage the Minister of State to walk along a path which I do not believe he will find unwelcome. We all recognise that the MRCA is important for two reasons. First, it contributes to our military potential. I do not intend to say anything about either its need or its efficacy, both of which I accept. However, it is also important as a vehicle of co-operation between three nations. The hon. Member for Hackney, South and Shoreditch (Mr. Brown) referred to this.
The contractual arrangements into which we shall have to enter in relation to this aircraft are relatively small. However, there is concern in the House and outside among firms as to how a venture of this sort concerning three nations will develop. Therefore, I want to encourage the Minister of State to say a little more about the way in which he views the next stages of the development of this tri-national aircraft—something which I am sure is a positive plus for co-operation in Europe. May I suggest that the Minister goes a little further along that road?
8.10 p.m.
The Minister of State for Defence (Mr. William Rodgers): When my hon. Friend the Member for Hackney, South and Shoreditch (Mr. Brown) told me that he wished to raise this matter this evening, I greatly welcomed the opportunity to relieve some of the anxieties that he
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expressed this evening and has expressed in correspondence with the Ministry of Defence. I did not at that time anticipate that the debate would go rather wider and in the direction which my hon. Friend the Member for Edinburgh, Central (Mr. Cook) has opened up. He said that he realised only three hours ago that he might speak in this debate in the manner in which he has spoken. I think that he will confirm that he told me only five minutes before the debate opened that he intended to do so. I appreciate his forbearance in not expecting a substantive reply to all the points he has made. Nevertheless, I should like to make a brief comment on some of them before turning to the particular matters raised by my hon. Friend the Member for Hackney, South and Shoreditch.
Perhaps I may say something first to the hon. Member for Clitheroe (Mr. Walder). I am glad that he has said—because I believe this to be true—that the MRCA is a very good example of successful international co-operation. It is fair to say that in many other respects—technically, in cost, and in administration—given the complexity of the project, it has gone better than anyone could have expected. All the evidence I have is that those who have been involved in the project and those who will in the end fly MRCA in operational circumstances are very pleased with the way in which things have gone.
I believe that most of the firms—as the hon. Member for Clitheroe mentioned—which might have wished to play their part in building this aircraft are aware of the procedures involved, though I shall be dealing with that matter shortly. The number of subcontractors is very large indeed, in this country and in the countries of our other two partners. I thought at one stage, when my hon. Friend the Member for Hackney, South and Shoreditch was referring to hawking around some of the work, that he probably underestimated the extent to which all the main contractors have subcontractors, because were this not so the project would not be completed on time and to the specification. Further, if it were not so, there would not be so many people in different parts of this country, as in Germany and Italy, engaged today in designing, developing and building the project.

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I hope that when the project is complete, is flying and is accepted into service, it will be recognised as a very good example of co-operation, and that we shall build on this in Europe, in civil as well as in military collaboration.
My hon. Friend the Member for Edinburgh, Central referred, quite rightly, to the Report of the Expenditure Committee. I read that Report with the greatest of interest, not only because it was a very good one and I might have been obliged to read it as Minister of State for Defence, but also because, as a former member of one of the sub-committees of the Expenditure Committee, perhaps I, even more than some of my colleagues, attach great importance and value to its work.
However, I must say two things to my hon. Friend. He knows that the Report that was published was based on evidence taken some time previously. That is inevitable, not only because of the procedures of the House but because of the time it takes to print any report. Therefore, it will be no surprise to my hon. Friend if I tell him that between the time the Expenditure Committee took evidence—and probably during the time in which it formed its view—and the time when the Report was published, there has been adequate time to carry out the very stringent review for which the Committee rightly asked. I can tell my hon. Friend that such a review was conducted in depth before the making of the decisions that were announced by my right hon. Friend in the House two or three weeks ago. Such a review has taken place. In so far as some of us might have anticipated the Report that the Expenditure Committee produced, my right hon. Friend and I, and my hon. Friends in the Department, were very anxious to satisfy ourselves very fully before any decisions were made and announced—because our concern must be my hon. Friend's concern—that this is the right aircraft for the rôle for which it has been assigned.
My hon. Friend's second question referred to the unit cost. I should put it to him that, of course, there are a number of different ways in which one can measure the cost of an aircraft. One can, for example, include the research and development cost in the unit cost, or one can exclude it from the unit cost. One can speak in terms of a life cycle, because—this is what I think my hon.
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Friend was referring to—this is a form with which the Germans are familiar. However, if we are comparing the unit cost of this aircraft with that of any other, and the unit cost of this aircraft in 1976 and the unit cost that was anticipated in 1969, I suggest that we should do so vertically, as it were, following the usual form that we use in this country, and not horizontally by comparing our costing with that of the Germans. Both are valid, but like should be compared with like.
I repeat what I have said previously in the House. Allowing for inflation and changes in exchange rates, although the unit cost of this aircraft has increased, broadly speaking, from £1·5 million in 1969 to £21 million today, at 1969 prices, I take the view that this escalation is no more than could have been anticipated in the circumstances of projects of this kind over a period of this sort.
My hon. Friend then referred to the air defence variant and quoted the views of the Economist. The views of the Economist were that the F15 would be cheaper and more effective in the air defence rôle. I must tell my hon. Friend that, leaving aside the whole question of the very large investment in technology and the very large number of jobs involved in this aircraft—a matter of high concern to everyone in Britain, particularly when unemployment is at an unacceptable level—the best evidence available to us is that the cost and performance of the MRCA air defence variant makes it the best aircraft for the rô1e.
I shall, of course, scrutinise the BAC memorandum, but I do not think that my hon. Friend should draw general conclusions from a specific example, and I think that he was cautious, in the last resort, about doing so.
My hon. Friend then referred to the improvement in the British nuclear deterrent. I am rather surprised that he attaches more importance to the views expressed by Air Commodore Donaldson in the Daily Telegraph than I would normally expect in his case. With no disrespect to Air Commodore Donaldson or to the Daily Telegraph, I have to say that they have never been my favourite reading, even if they have been that of my hon. Friend. I think it is fanciful in the extreme to believe that any improvements

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in the British nuclear deterrent, whatever they may or may not cost—and again, I would not believe all that I read in the newspapers—are designed to give the MRCA a further rôle. It is news to me. I do not believe it for a moment. I do not believe that my hon. Friend has any cause to worry.
Finally, my hon. Friend the Member for Edinburgh, Central rightly referred to the debate on the question whether surface-to-air weapons would be a substitute for manned aircraft. He said that this debate first came into focus over 20 years ago. Again, I hope that he will not mind my saying that he and Lord Sandys appear to be in concert in this matter. I do not always believe what Lord Sandys says. I believe that some of his decisions as Secretary of State were wrong. However, if my hon. Friend wants to revive the argument and wants to endorse Lord Sandys' views, he is entitled to do so. It will be met with a great deal of interest on both sides of the House.
This is a proper subject for debate.
However, with respect to my hon. Friend, all the evidence available on this matter, including a consideration of the technical problems—my hon. Friend says that he is not an expert—goes to show that a mix of surface-to-air weapons and manned aircraft is the best way of ensuring air defence. As my hon. Friend will know, the MRCA air defence variant will be added to surface-to-air missiles, which will provide precisely the mix that I think is likely most nearly to meet the need.
I do not want to suggest that these are not important problems or are not matters about which we can argue, or questions on which it is not possible to have two views. I should love to argue these matters more fully tonight, Mr. Deputy Speaker, if you were to allow that, but the issues go far wider than the issue originally raised by my hon. Friend the Member for Hackney, South and Shoreditch, to which I must now return—the subject of the MRCA and the question of research and development and contracts for it.
As my hon. Friend the Member for Hackney, South and Shoreditch has said, and as I have implied—and as I think
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that my hon. Friend the Member for Edinburgh, Central accepts, with the hon. Member for Clitheroe—the MRCA is a project of the very greatest importance, not only to the Royal Air Force and, therefore, the defence of Britain, but to the strength of NATO and to British industry.
Whatever hesitations my hon. Friend the Member for Edinburgh, Central may have, I greatly welcome the endorsement given to this project by my hon. Friend the Member for Hackney, South and Shoreditch, who need not worry when it flies over his constituency.
Like any collaborative project, the arrangements for the procurement of the aircraft are very complex, but I hope the House will bear with me, because an understanding of them is essential to tonight's debate and the anxieties expressed by my hon. Friend the Member for Hackney, South and Shoreditch.
In the case of the MRCA, the three Governments concerned—the United Kingdom, the Federal German Republic and Italy—control the project through the NATO MRCA Management Organisation, called NAMMO, in which all three are represented at a high level. Detailed management is conducted by NAMMO's Agency, which is called NAMMA.
There are three prime contractors—Panavia, Turbo-Union and Mauser—which I will call functional organisations to distinguish them from the interests of the three Governments. Those contractors are responsible to the three Governments through the international agency, NAMMA.
Mauser makes MRCA's cannon, and Turbo-Union is a London-based engine consortium. I do not think that I need comment further on them.
Panavia, by far the largest of the three functional organisations, was formed in March 1969 to design, develop and produce the airframe for the MRCA. It is based in Munich, close to NAMMA, and its component companies are BAC, Messerschmitt and Aeritalia. BAC designs and builds the nose fuselage, cockpits, rear fuselage and tail. Messerschmitt makes the centre fuselage and wing pivot. Aeritalia makes the wings. It is Panavia
Procedures for procuring components varv according to their importance. The with which we are concerned tonight.

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first stage in the procurement of the most important components for the airframe, to which my hon. Friend the Member for Hackney, South and Shoreditch referred, is for the specifications to be agreed by the three Governments and passed to Panavia through NAMMA. Then requests for proposals are made by Panavia to possible suppliers of the equipment, as nominated by the three Governments. These invitations specify a wide range of conditions to be met by possible suppliers in their tenders, including technical specifications, performance characteristics, prices for various batch sizes, and so on. The bids received are first evaluated by Panavia against the criteria laid down in the request for proposals sent to the firms. Panavia provides NAMMA with the results of this evaluation and its preferred choice.
While this is going on in the international consortium, the national procurement agencies of the three countries—in our case, the procurement executive of the Ministry of Defence—also receive copies of the bids made by the nominated suppliers and evaluate them independently.
Final selection is made by the Equipment Control Panel, which is chaired by the international agency NAMMA and includes expert technical and administrative representatives from the three nations. In this final selection process Panavia, which is the commercial consortium—one of the three functional bodies—is in attendance. Selection from amongst the bids received must be by unanimous agreement of the three nations.
At this important meeting which I have described, with Panavia in attendance, both the bids and Panavia's assessment of them are cross-questioned. Challenges can be made about the technical aspects of the bids, the competence of the firms, and the financial composition of any of the bids. I must emphasise that the process is extremely searching. If necessary, visits are made to the firms involved during the selection process.
Should the Equipment Control Panel fail to agree, a report is made to the NAMMA board of directors. The board members, who are representative of the three Governments, can in turn refer back to Ministers in their own countries for guidance. In the last resort, though this is not a step which is lightly undertaken,
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a country can decide to provide that part of the aircraft nationally—in effect, to opt out of collaboration in one area.
These exhaustive and complex procedures—they are more complex than I have described and would choose to describe tonight—are designed to ensure that all bids are fairly considered. I shall give one obvious example. The procedures are designed to discover whether any subsidy might be involved, because a subsidy by a Government is not allowed under the rules of collaboration on the MRCA.
Separately from this process, elaborate though it is, great trouble is taken to ensure equitable work-sharing arrangements over the programme as a whole. This is designed to reduce, as far as possible, the flow of money across the exchanges—something in which we have a great interest—and to ensure that each country's industry receives roughly the same proportion of work as the proportion that it pays to the total cost of the project.
In this process the job of the Ministry of Defence and my Department is to ensure that the agreed procedures are followed and that the competing bids are considered on all fours with each other. I stress that we are aiming at the best aircraft possible and, in the context of the give-and-take of collaboration, to ensure that British firms get a fair share in producing it.
My hon. Friend the Member for Hackney, South and Shoreditch said that he talked from experience of his membership of WEU. I think that he knows that, as a former leader of the United Kingdom delegation to the WEU, I put my own value on its work, particularly regarding parliamentary contacts. My hon. Friend was right to imply that the stores management system is at the heart of the MRCA weapons delivery system. That is a very good reason why it should be a subject of discussion amongst Members of Parliament and a subject of fierce competition in some areas.
The prime objective of the MRCA weapons delivery system is to release the correct weapon from the correct position on the aircraft at the right moment for maximum delivery accuracy. That seems an elaborate way of saying that it is to make the MRCA serve the purpose for

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which it is intended. In other words, it is absolutely essential to the effectiveness of the weapons system. The MRCA store management system is part of the weapons system which the MRCA as a whole represents. This elaborate system must cater for the different characteristics of all the different weapons of the partner nations—we have not yet reached a stage of perfect standardisation—satisfy demanding safety requirements, and contain the potential to handle new weapons in future. It represents a considerable advance in complexity and sophistication over any previous system of this nature. It is not a simple piece of engineering, even by the standards of our largest and most experienced and sophisticated firms, as I am sure my hon. Friend will accept.
I turn now to the timetable, which I broadly endorse, as described by my hon. Friend. Competitive tenders to provide this equipment were received from five companies in 1972. The proposals submitted by Marconi-Elliott Avionics Systems Ltd. was selected by agreement between the partner nations and the airframe contractor, Panavia, in the way that I have just described.
It subsequently emerged—my hon. Friend the Member for Hackney, South and Shoreditch should not be too surprised at this, given the complexity and originality of the project—that the specification laid down by the three Governments was in some areas insufficiently detailed. Furthermore, the size of the task had been underestimated. To some extent this was unavoidable because assumptions had to be made about related equipments which had not yet been developed. The firm of MEASL did its best to produce a stores management system to the agreed specification, but by early 1974 it became clear that it would not be able to do so at an acceptable price and in the required time-scale.
Mr. Ronald Brown: This is an area of contention, and the Minister's explanation is not acceptable. It is not much good saying that the matter was looked at again. This was a throw-away item for that organisation and the fact is that it was not competent to carry out the work.
Mr. Rodgers: If my hon. Friend is patient, I hope that I shall solve his
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anxieties in the latter part of my remarks. It does not surprise me that those who are unsuccessful in a competition take the view that their system is better and that they should not be ready to applaud the efforts of the company that wins. That is the nature of commercial competition in a sensitive area. Those who are disappointed as a result are not prepared to say that they lost the deal because the price was wrong, the reliability not so great, or the delivery time not so keen. If a firm loses a contract it has gone, and it tends to believe that the fault lies on the other side and that its competitors do not deserve their success. My hon. Friend and I can argue this case until the cows come home, but we must accept that the procedures are clear and carefully laid down.
I have no obligation to be a spokesman for MEASL, nor would I choose to be its spokesman, but I thought that my hon. Friend was unfair in his references to that firm. I am sure that he was not referring to that firm's total capacity as incompetent. That is certainly not a view that I would endorse, because the firm has had a remarkable record of success. It has achieved that record in competitive markets at home and abroad, and that fact should be put on record. Therefore, I do not go along with my hon. Friend's verdict, which could be damaging if it stood without any further comment.
If I continue the story, it might provide an answer to my hon. Friend. In 1974 the company put forward revised proposals for a simplified system which would not only reduce costs but be more suitable to Service requirements. I emphasise that the specification was laid down by Governments. That was not the responsibility of MEASL. If anybody should bear the responsibility for an underestimate of the size of task or any failure of specification, in that it was insufficiently detailed or too ambitious, the responsibility lies with Governments and not with any one firm.
There were further discussions between the firm, Panavia and NAMMA about the system, which led to a revision of the specification by the three partner countries. To be fair to those companies which had taken part in the original competition, we and our European partners felt it right to run a new

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competition. It seems to me, on the face of the matter, that it was right for us and our European partners to run a new competition, although in the interim, after discussion with MEASL, we had produced a revised specification that we felt met the need. When we ran a new competition there was no reason to exclude Marconi-Elliott, because that firm was experienced in this work and the difficulties which it had encountered earlier were not of its own making. My hon. Friend may dispute that.
Mr. Ronald Brown: I do.
Mr. Rodgers: We cannot resolve that matter tonight. Certainly the difficulties encountered earlier were not of that firm's own making.
Submissions were received from five companies, including MEASL, in conjunction with Selenia of Italy. I appreciate what my hon. Friend said about that firm. However, any comment I make tonight on that score would be inappropriate. If further inquiries require to be made, we shall make them.
Quite apart from MEASL, Computer Devices Limited, which had a work-sharing agreement with LITEF in West Germany, was one of the other five firms which competed. This elaborate system of assessing bids was applied to the submissions received from the five companies, including MEASL and Computer Devices Limited. The procedure was rigorously and, in my view, properly applied and eventually it was decided by the United Kingdom and Italy that the contract should go to Marconi-Elliott. The German Government decided to go for a third company, Base 10, as my hon. Friend said.
I listened to my hon. Friend with great care, but there is nothing that I have seen in examining the matters which he raised that leads me to believe that the outcome of the second tendering procedure was sinister, that it was in any way a matter of "Buggins' turn" or that there was anything squalid or disgraceful about it. I say again that we must discount at least some of what may have been said, perhaps in this country and certainly abroad, on the ground that this is a world of tough commercial competition, in which everyone is naturally out to get what he can from this very valuable contracting work.
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It is not the practice of the three countries collaborating over the MRCA to give any company the detailed reasons for selecting or rejecting a bid that it has made for a piece of equipment. Nor do I think that it would necessarily be the wish of firms for details to be discussed in public. However, the Government and the Ministry of Defence see it as part of our duty to assist all our contractors to become more efficient and competitive in world markets. The Ministry keeps in touch with Computer Devices Limited, for example, and is always ready to advise it on how it can improve its products for the future.
I deal now with my hon. Friend's reference to my right hon. Friend the Secretary of State. My hon. Friend will understand that it is simply not possible for Ministers themselves to meet representatives of all the firms engaged in contractual work of this kind. The list is very long, as he will know from the list which was printed in Hansard a short time ago.
Mr. Ronald Brown: My right hon. Friend is taking this line. However, I must emphasise to him that I do not know any contractor, I have never asked any contractor, and I have never been concerned with any contractor. I asked the Secretary of State to talk to me. He said that he could not. I felt so sure of my ground that I asked him whether he would allow me to meet his advisers, because I wanted to test them out and to give them an opportunity to test me out. Apparently, he consulted these people, who refused to see me. I asked for that interview because of my concern and belief that what I said happened to be true and that the MRCA weapons delivery system would be the worse off for it.
Mr. Rodgers: My hon. Friend has many affectionate characteristics, one of which is his well-known impatience. I was just about to come to that very point. I understand the burden of his argument. It has rested on a number of different matters. I am sure he will accept that I was talking generally and without reference to him when I said that it was not possible and, indeed, that it might in the end raise problems, for Ministers to be lobbied when competitive tendering was taking place. It is not possible for Ministers to meet representatives of all the firms engaged in it.

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Nevertheless, in the special circumstances of this case and in view of the fact that misunderstandings have arisen—that is clear from what my hon. Friend has just said—if my hon. Friend wishes to bring representatives of the firm to meet me, I shall be prepared to meet them.
Mr. Ronald Brown: I have no reason to bring anyone. That is the point that I am trying to make. I do not know any firm. It was the Member of Parliament for Hackney, South and Shore-ditch—me—who wished to have words with the Secretary of State and, if not with him, with his advisers.
Mr. Rodgers: I was simply going to say that if my hon. Friend does not wish to come with the firm to talk to me I shall be delighted to see him to discuss any matters on which I have not given a satisfactory reply tonight.

NATIONAL ENTERPRISE BOARD
8.40 p.m.
Mr. Michael Marshall: I shall begin my remarks with a protest about the way in which the House is once more being kept in the dark about the provision of capital for the National Enterprise Board. The chance of discussing the matter has arisen only because we have been fortunate in the Ballot which determines the subjects that we discuss. But the whole principle that is at stake goes wider and deeper. We are concerned with the sum of just under £15 million, and the only entry in the Estimates is the increase of public dividend capital to the NEB from £1,000 to nearly £15 million. That is typical of the breathtaking way in which the activities of the NEB are being foisted upon the House without proper scrutiny.
I have made an informal check on what this £15 million covers, and I am grateful to the Minister's Department for the advice I have received. It is wrong that the House should have to rely on that type of scrutiny and informal inquiry. I understand that about two-thirds of the sum is intended for Rolls-Royce and the next largest sum for Brown Boveri, both of which are subsidiaries of the NEB. I understand that the balance is to be divided largely between administration and contingencies.
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Will the Minister say in more detail how this £14,999,000 is to be allocated? It seems wrong that we should have to extract this information from the Minister at the Dispatch Box, and I have some sympathy with him in having to pick up the threads in this way. But that does not lessen my criticism of the Government's system. For what precise purpose is this amount of public dividend capital earmarked?
My hon. Friends are seeking assurances because there are a number of companies in the NEB portfolio. I shall concentrate mainly on Rolls-Royce, which I understand is likely to receive the largest amount within the ceiling of just under £15 million. The affairs of Rolls-Royce since the NEB came into existence have made a sorry tale. What guarantee can the Minister give on the effective monitoring and use of the capital sum which is intended for Rolls-Royce? That brings me to the heart of the problem. We cannot discuss the provision of capital to the NEB without in turn considering how the NEB allocates that capital to its subsidiaries. The relationship between the NEB and Rolls-Royce has had a public airing through the Press, but for all we know there has been no effective dialogue between the Department of Industry and the Treasury, and certainly there has been none with this House.
What has been shown is the total folly in failing to resolve how the National Enterprise Board should use the powers which it possesses of manipulating the purse strings once these block sums are made available to it. This has brought into the open what has been at the heart of all the fears that so many of us had in Committee and all the way through the Industry Bill, as it then was. Indeed, our worst fears have been confirmed. Companies like Rolls-Royce, which are operating in the highly competitive international field of aero-engines, must have commercial freedom to operate. I shall certainly look to the Minister of State tonight to show whether he is accepting that view, as I believe the Department of Industry should accept it, that the maximum degree of autonomy and flexibility ought to go to the subsidiary companies within the National Enterprise Board, whereas the question of scrutiny of the National Enterprise Board itself is a matter in which our reservations and

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worries require much closer parliamentary examination.
Taking the whole argument between the National Enterprise Board and Rolls-Royce, I would quote from the Financial Times of 12th February, which, in a very pungent article, gave a perfect case history of how this system which the Government have foisted upon the country is already seen to be going wrong. It stated:
"The responsibility for the public row between Lord Ryder and Sir Kenneth Keith over the control of Rolls-Royce 1971 rests entirely with the Government".
The article went on to say:
"No thought appears to have been given to how the relationship between the three parties—the management, the National Enterprise Board and the Government itself—would be handled."
It continued:
"If the National Enterprise Board is to control it"—
that is, Rolls-Royce—
"as tightly as Lord Ryder seems to want, he would need to have his own experts to appraise and monitor the company's own programme".
In other words, we are here facing one of the classic examples of duplication which the present Government seem to perpetuate with almost every piece of legislation they bring forward in the field of industry.
As the article asks, what purpose does this duplication serve? This is a question which has not been answered by the Government. The net result is, as the article concludes:
"To allow the present quarrel to continue will not only make the participants look even more ridiculous, but will cause unnecessary damage to both Rolls-Royce and the National Enterprise Board".
In one very well-known and clear case, we have seen the way, I fear, in which the National Enterprise Board is to go ahead in the future. We shall see a sort of management by confrontation, and this is a matter to which the Government must address themselves. When the Minister of State comes to reply, I look to him for some answers from the Government, particularly as we are now already long enough into the life of the National Enterprise Board to take a reasonable view.
I ask this question also in the context of the uncertainty which still obtains with regard to the Treasury's vetting of the
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National Enterprise Board's programmes. We know that the National Enterprise Board can engage in loans, guarantees and joint ventures up to £25 million without seeking approval from the Secretary of State. Similarly, we know that it can indulge in share purchases of up to £10 million.
It is part of my contention that what we are discussing tonight is typical of the way in which the National Enterprise Board, as opposed to its subsidiaries, is-wide open to any kind of empire-building, because these sums are substantial amounts.
Question Time on 1st March highlighted many of the problems that we face, particularly in regard to the question of Treasury scrutiny. On that occasion my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) asked the Secretary of State:
"Who is responsible to the Comptroller and Auditor General for ensuring that public funds voted to the NEB and, through it, to its subsidiaries are spent in the way Parliament was informed they would be spent?"
The Secretary of State said in part:
"My short answer is that the accounting officer in my Department, the Permanent Secretary, will be responsible to the Comptroller and Auditor General. I know that there is some controversy about that matter, and I shall be looking into it further."—[Official Report, 1st March 1976; Vol. 906, c. 888.]
How far has this matter been looked at further? This important question vitally affects our judgment of the proposal presently before us. The Minister must give us some assurance, otherwise yet again the taxpayer will get the impression that, late at night, his purse is being milked without proper accountability.
A number of times the Government have said that these amounts are merely small sums which we can consider later. We are always being told that scrutiny will be possible later, but the £15 million is part of a sum of £49 million generally devoted to support for industry. That brings me to the whole question of parliamentary accountability. I shall cite only two recent examples to show the real fears that I have about the way in which these matters are not only considered now, but, so far as I can see, will be considered in future, unless the Government admit to the House that they have got their basic systems wrong and put forward alternative proposals.
The first example of trying to gauge the way in which the NEB is discharging its duties in the expenditure of taxpayers' money came up in November last year, when my hon. Friend the Member for Tonbridge and Mailing (Mr. Stanley) said, on a point of order, that he had been unable to get answers about the numbers and grades of staff employed by the Board. On 18th December 1975, in a statement, the Lord President accepted that the basic point required an answer, but he did not give one. Instead, he talked a great deal about how it was impossible to set up the kind of control which seemed to be implied in my hon. Friend's question.
What is significant, however, is that these anxieties were reflected in all parts of the House. The hon. Member for Bristol, North-East (Mr. Palmer) asked whether the NEB would be subject to the scrutiny of the Select Committee on Nationalised Industries. The Lord President said that he would look into the matter and let his hon. Friend know.
The hon. Member for Newcastle-upon-Tyne, East (Mr. Thomas) said that it was only through Questions to Ministers that these matters could be dealt with, which was not satisfactory because the information was often presented
"in the form and manner and with the omissions and additions that the industries decide, with the Minister concerned often unable to add any gloss or factual content of his own."
They were fair criticisms. The burden of the Lord President's case was simply:
"Perhaps the best course of action would be to see how it goes. If difficulties arise, we can look at the matter again."—[Official Report, 18th December 1975; Vol. 902, c. 1660, 1658.]
That is typical of the prevarication which has run through the history of the Industry Act.
We were assured by the Prime Minister that the White Paper would be the "bible" for the activities of the NEB. That assurance was reiterated many times in Committee, but since the Act was passed there has been more and more prevarication of the kind I have cited.
I should like finally to cite from my own experience ways in which this frustration and lack of information is continuing. I have found three months later, in trying to get some indication of
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whether or not Ministers are undertaking a proper scrutiny of the way the National Enterprise Board operates, that it is totally impossible to get full and frank answers. I raised this subject some time ago in Questions which I put to the Secretary of State for Industry, the Chancellor of the Duchy of Lancaster and the Prime Minister.
I asked a very simple question: on how many occasions since the Chairman of the NEB had taken up his office had those three Ministers met him? The answers I got were revealing. The Secretary of State for Industry said:
"On a number of occasions."—[Official Report, 1st March 1976; Vol. 906, c. 889.]
I am bound to say that his answer was one of accuracy and courtesy of the highest order compared with the answers I got from his colleagues.
My Question to the Chancellor of the Duchy of Lancaster produced one of the classic bits of Whitehall gobbledegook which should be enshrined in the Official Report, and I intend to make it so. The answer which I got was that he had not held any non-bilateral meetings with the Chairman of the National Enterprise Board. We on this side of the House are able occasionally to manage to unscramble some of these double negatives.
I put down a further Question to the Chancellor of the Duchy of Lancaster asking how many meetings he had had which were not non-bilateral meetings, and today I received an answer which tells me that:
"The Chairman of the National Enterprise Board and I have been present at internal Government meetings and at one meeting of the National Economic Development Council."
We are making progress. Perhaps if I can keep this up we may be able to establish in another three months whether the Chancellor of the Duchy of Lancaster is as effectively exercising the kind of veto as he managed to exercise on British Leyland.
These are crucial matters which affect our judgment, not only of the kind of expenditure that we are now considering but of the whole future of Government strategy towards industry itself. This is why I particularly highlight the rôle of the Prime Minister in this matter. I realise the sensitivity on the Government Benches on this matter. I look across at

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the Minister of State, who has been remarkably shy so far in putting forward his candidature, because he is well aware from some of the comments on this side that we have been pushing for some time for a place for him in the Cabinet, and I do not see why he should not pass in one fell swoop through the door marked "No. 10".
We cannot understand why the Prime Minister himself, who is in many ways the guarantor of the whole concept of the NEB via the White Paper, should be so evasive. I want to get firmly on the record the attitude of the Prime Minister, since I look to his successor to take up this same underwriting of the NEB's activities, whether he be the minister of State or one of his colleagues.
I shall therefore quote again from exchanges I have had with the Prime Minister. In a Written Question on 23rd February, I asked him on how many occasions he had met the Chairman of the National Enterprise Board. His answer was:
"It is not the practice to list the number of my meetings with the chairmen of statutory bodies. Any Questions about the operations of the National Enterprise Board should be directed to my right hon. Friend the Secretary of State for Industry."—[Official Report, 23rd February, 1976; Vol. 906, c. 54.]
I felt that that was evasive on this issue once more, so I put down a further Question for 23rd March, asking the Prime Minister when he next expected to meet the Chairman of the NEB. I received a note telling me that that Question had been transferred to the Secretary of State for Industry. I cite this as another example of the kind of classic double-thinking that goes on in Whitehall. I asked the Prime Minister when he was to meet the Chairman of the NEB. I did not ask that Question of the Secretary of State for Industry, and I should like to have an answer to it.
In order to obtain an answer, I wrote to the Prime Minister on 15th March to ask him whether he did not regard the whole saga as totally unsatisfactory. I regret to tell you, Mr. Deputy Speaker, that he was so appalled by the confusion in his own midst that he resigned the next day.
I do not want to leave the matter there. I look to the Minister of State to make it abundantly clear that he recog-
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nises the way in which hon. Members are frustrated in trying to establish how scrutiny in this place, through Ministers, is being exercised. It is typical of the veil of secrecy which surrounds not only scrutiny by Ministers but the policy of Ministers towards reporting to the House.
On Third Reading of the Industry Bill on 3rd July 1975, I had the opportunity to refer to submissions that were made in Committee on behalf of the Institute of Directors. Labour Members were disposed to make light of those submissions, yet the institute had singled out as the one most important point for the Industry Act, as it now is, that there should be the need for specific approval by the House of major National Enterprise Board capital expenditure. Its view has been amply confirmed.
It is by pure chance, having been lucky in the Ballot, that we have the opportunity to discuss a matter which would otherwise have gone through "on the nod". Unless the House is able to exercise the sort of scrutiny that I have suggested, I fear that the Government will continue to put things through "on the nod ". We must not allow this occasion to pass without seeking an assurance from the Government that some rethinking is going on.
The present situation cannot be a satisfactory way in which to proceed. The Government are in a massive six-sided box. The Minister will know my interest and appreciation in these vast mazes involving different and conflicting parties. The Minister must agree that we have a six-sided box in which the NEB and its subsidiaries are battling against the Secretary of State and the Treasury while the House—and the Select Committees, if the Committees are to be brought into this whole pattern—are being kept totally in the dark.
I do not mean any disrespect to the Minister when I say that he may be partly in the dark. I know that this is not a subject for which he has prime responsibility. However, I ask him to tell the House and the country that the Government are not meandering in a total maze. I hope that he will tell us how the NEB can be more accountable not only to Ministers but to the House. If he can tell us that, I believe that we shall be making some progress and obtaining

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some answers to those which have been frustrated so far.
9.04 p.m.
Mr. Michael Grylls: I am delighted to take up the points raised by my hon. Friend the Member for Arundel (Mr. Marshall). It is unfortunate that our concern is not reflected in the interest shown by Labour Members. It is disappointing to see how few Labour Members are present. After all, the NEB is their child. It is supposed to be the great regenerator of British industry. It appears that Labour Members have regenerated off home. Be that as it may, we are delighted to have the presence of the Minister of State. He is a most courteous Minister. Given the ample array of support that he gets from the Box, I am sure he will be able to answer us in his usual way. I mean that as a compliment.
First, I am curious to know who inserted the figure of £1,000 in the massive tome of the Supplementary Estimates. It seems that it has now grown to £14,999,000. It is extraordinary that anyone should have made that error. No doubt the Minister of State will be able to correct me if I am wrong.
The Minister of State, Department of Industry (Mr. Gregor Mackenzie): I know that the hon. Member studies these matters with great care, so he should know that it is the normal pattern to put down £1,000 merely as an indication of one's attitude. This is the normal practice, which has been followed by both sides for a long time.
Mr. Grylls: That may be true in other areas of policy, but we are breaking new ground with the NEB. It is a new body, with a lot of expensive manpower. It has an office in Grosvenor Gardens—not one of the cheaper parts of London—and a lot of people to get the figures right. Yet they do not seem to be able to do so. It is very odd.
I am concerned about the part of the Estimates devoted to administration of the Board. Presumably the marketing people within the Board know its policy on competition. Is the Board to subsidise subsidiary companies so that they can enter into unfair competition?
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In recent months there has been a feeling in industry that because the Board is backed by the Government, it is in a preferential position. This is an understandable feeling.
I am sure that the magazine The Engineer is required reading in the Department of Industry. No doubt it is studied very closely by Ministers. The issue of 4th March says:
"Varley wants the NEB to determine prices for products and services in accordance with the requirement to earn an adequate return on capital".
That is fine. The article continues:
"It should not show 'undue preference' and should arrange that its subsidiaries do so too."
But how are we to define an adequate return on capital? "Adequate" can mean anything, and we suspect the word has been used to cover a multitude of sins. There is talk about not showing undue preference, but preference to a business man is unfair competition using taxpayers' money to steal a march over the rest of industry.
I would be delighted if the Minister of State could shoot me down in flames with a categoric assurance to the contrary, but I suspect he has let the cat out of the bag and that the words "undue preference" have been used to leave room for manoeuvre and that subsidiary companies such as Leyland and Brown Boveri will be able to go in for unfair competition against private industry.
Sometimes I feel that in our debates about industry we talk too much in generalisations. It is perhaps more important to get down to specifics.
Coventry Climax, a well-known subsidiary company of Leyland, makes fork-lift trucks. Since the British Leyland drama, it has been entering into what many people in the business claim to be an uncommercial sales drive. It has been one of the more successful parts of British Leyland. It has not, I understand, made a loss. In the past it has never, as far as I am aware, been in great difficulties. But it is giving £1,000 discount on a fork-lift truck worth £8,000, despite the fact that previously it was getting the business perfectly easily.
On of the very biggest of the other companies in the fork-lift truck business is in the constituency of my hon. Friend the Member for Beeston (Mr. Lester).

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That company is now finding that in a very competitive business Coventry Climax is selling its fork-lift trucks at these enormous discounts. This is really not necessary. Coventry Climax has sold two fork-lift trucks to Rolls-Royce, Derby, at a total discount of £2,500.
I know that the Minister of State does not have direct responsibility, but this is our trouble with the National Enterprise Board. If the NEB is allowed to do this sort of thing it is not really helping British Leyland. It is only making life more difficult for the rest of British industry. It is a crazy situation.
Perhaps Coventry Climax is trying to pick up a trick or two from the Japanese, but it ill behoves a nationalised company—salvaged by the British taxpayer in a quite involuntary contribution to British Leyland—to go in for dumping, causing other companies in the country to suffer in the process.
I make these comments in a positive sense and not by way of trying to hit the NEB on the head. I hope the Minister of State will be able to give the answer tonight to this question about Coventry Climax. If he cannot, I hope that instructions will go out very quickly from his Department to Coventry Climax, telling it to stop this sort of practice, because the taxpayer does not subsidise firms in order to enable them to put others out of business.
My hon. Friends and I are deeply co-cerned about the employment situation in these other firms in parts of the country where today there are already severe unemployment difficulties. I hope, therefore that the Minister of State will be able to assure us on this aspect.
One of the sub-headings relates to Rolls-Royce. Apparently some of the money is being transferred to Rolls-Royce. Many people wonder what is happening to the Rolls-Royce company, which was nationalised under the previous Conservative Government, and therefore held as a Government company, and which was transferred on 25th February to the National Enterprise Board. There has been a good deal of Press comment as to the price at which it was transferred to the NEB.
It is rather curious that in an answer to a Parliamentary Question at the end of last year the value of Rolls-Royce
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was put at £123 million, yet three months later it was transferred to the NEB at £137 million. I do not necessarily criticise that, because I do not have access to the figures or calculations, but it rather looks as if Lord Ryder is not winning the argument. He wanted to have Rolls-Royce transferred to the NEB at a knock-down price. It looks instead as if the price has been raised considerably. I hope that the Minister of State will be able to give an answer on this matter.
My hon. Friend the Member for Arundel referred to the somewhat quaint situation resulting from having an enormously important company like Rolls-Royce which at one moment is owned by the Government and the next is transferred to the NEB. From now on, will the NEB assume responsibility for financing Rolls-Royce? There have been comments in the Press to the effect that Rolls-Royce will need another £100 million this year. I looked again at the Supplementary Estimates to see provision for that amount, but having seen that provision has been made for only £1,000 and that £15 million is needed I was not surprised that there was no provision for Rolls-Royce.
We know that the aero-engine business is very expensive, in terms of new developments and research and development costs. If it needs a further £100 million it will presumably come from the ever-shrinking NEB kitty. Here we have the key to why there are not many Labour Members present.
The Members of the Tribune Group, who no doubt are campaigning for other causes at present, will be bitterly disappointed, because when we first had the NEB floated in front of us by the then Secretary of State for Industry—the present Secretary of State for Energy who is also otherwise engaged at present—we were told that the NEB would be the great interventionist tool and that a massive amount of money would be available to it. Last week we debated the public expenditure White Paper, which referred to £950 million—and that, incidentally, has shrunk by 25 per cent. because of inflation, and at constant prices. Already £300 million of that is pre-empted for British Leyland, and I have already mentioned £100 million for Rolls-Royce. One wonders what there:

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will be left for the great regeneration of British industry. The whole thing appears to be a farce, because the vast proportion of NEB money has already been pre-empted for Rolls-Royce and British Leyland, and I believe that a certain amount is going to Chrysler.
We must not forget the Left Wing. I should like to tempt the Minister to comment on his friend, colleague and comrade, Mr. Ron Hayward, who is a great expert on industrial matters and who apparently speaks for the Labour Party. In a newspaper article the other day he said that he believed that the NEB should stop being on the defensive and go on to the offensive. It is rather frightening that just as we begin to pick up and recover from the Benn era we find ourselves entering the Hayward era. Ron Hayward will make industry lose confidence.
What will the NEB do to attract industry's interest? Will it be a source of cheap money? Apparently not, because there will not be much money and it does not look as if it will be cheap—that certainly was the experience of the IRC. The IRC was able to attract people only by offering a special cheap rate of money because it was involved in the Government. Yet Mr. Ron Hayward tells business to invest and to provide new jobs.
I hope that the Minister of State, who is an honest, practical and sensible Minister, will use his considerable skills and powers of persuasion as a Minister in the Department of Industry to say to his colleagues in the Government "Never mind about the NEB, we have it and it will carry on, with not very much money and not a very exciting future." If he can persuade his colleagues in the Government to set the right framework for industry, to encourage industry to make decent profits and therefore to expand and to provide new jobs he will be doing a really useful job. I believe that Lord Ryder could have a similar rôle, instead of charging around industry like a rogue elephant trying to take over companies when he has no money anyway.
I make no apology for raising this matter tonight; rather the reverse. My hon. Friends and I hope that we have done good in debating the question of the NEB. This modest error in the Supplementary Estimate we shall leave to one side, but the future of the NEB will be
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debated frequently in the House. Our main complaint is that it has not been debated sufficiently frequently in Government time to be given proper consideration.
I hope that the Minister will be able to answer the questions I have asked and give some satisfaction and encouragement to industry to feel that there will not be unfair competition. I stress the main point I raised about Coventry Climax. If the Minister can assure me that the company will not be allowed, as part of a nationalised industry, to offer absurd discounts which will result in people in other competing companies losing their jobs, the debate will have been worth while on that score alone.
9.22 p.m.
Mr. Anthony Nelson: My hon. Friends the Members for Arundel (Mr. Marshall) and Surrey, North-West (Mr. Grylls) have already eloquently expressed their deep concern about the figures contained in the Supplementary Estimate. I wish to emphasise my concern at seeing the original estimate of proposed public dividend capital for the National Enterprise Board increased from £1,000 to £15 million. We were told by the Minister that this was a preliminary estimate and that as the arrangements were firmed up it was appropriate to come forward with a supplementary requirement of £14,999,000. However, I feel strongly that when the original estimates were set out there were sufficient grounds for making a more realistic estimate of PDC requirement of the National Enterprise Board. It is bad financial management to have to come back to the House for nearly £15 million in this way.
More amazing, however, are the overall figures for general support for industry, which show a similar leap from an original estimate, in 1974–75, of £312 million, to £956 million. This is symptomatic of the way in which this profligate Government have expended public money and drawn down loans on behalf of taxpayers, not to provide employment and sustain companies which are in temporary difficulty but to provide money for companies which do not need it, which are profitable and in which, by the Industry Act and through the tentacles of the NEB, the Government seek a controlling interest.

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What is to be the proposed structure of the NEB? The estimates give the PDC estimate as £15 million, but the Industry Act allows for an expenditure of £1,000 million by order of the Secretary of State, and this may be substantially larger where the Secretary of State, by direction, orders the NEB to acquire certain holdings. On the face of it that seems to be a very high debt/equity ratio. The Minister will be aware that we have had some previous discussion on the question of the proper debt/equity ratio for public sector bodies. May we have an indication of the pro forma balance sheet and the application of funds in the NEB?
I want to know the total amount that the National Enterprise Board has drawn down and spent so far on acquiring the holdings which were set out and itemised by his right hon. Friend in answer to various Parliamentary Questions. Of that total, which is the total of the balance sheet or the liabilities of the National Enterprise Board, how much is made up of loans drawn down from the National Loans Fund and how much is the proposed or existing equity element? It would appear that the £15 million is the sole amount of equity or public dividend capital and, therefore, one assumes that the acquisitions undertaken by the NEB have been financed over and above that capital element entirely by loans. That is a substantial amount of debt, as I shall hope to indicate.
I want to know specifically how much has been borrowed from the National Loans Fund. That will be an important indication of the extent to which the NEB can be self-financing, because we have been told that when the NEB borrows from the Government for investments on its own initiative it will be charged the current rate of interest for loans from the National Loans Fund.
Secondly, I want to know in greater detail than has been made available to the House so far what are the costs of the holdings acquired by the NEB. That is particularly relevant to the figures set out in the Supplementary Estimates. If we are to sanction and approve an element of risk capital which taxpayers pay up to this body, it is proper that we should know the debts and liabilities on the same side of the balance sheet which have been used to pay for the substantial
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holdings and acquisitions which the NEB has made so far. The holdings which the Board has so far acquired are set out in a Written Answer to my hon. Friend the Member for Henley (Mr. Heseltine) on 8th March this year. They were a 95 per cent. holding in British Leyland Ltd, a 100 per cent. holding in Rolls Royce (1971) Ltd, a 12·3 per cent. holding in Brown Boveri Kent Ltd, a 2·6 per cent. holding in Dunford and Elliott Ltd, a 62·5 per cent. holding in Ferranti Ltd, a 100 per cent. holding in Herbert Ltd, and a 28·2 per cent. holding in Cambridge Instruments Ltd. Yet I have searched in vain to obtain figures for each and for the total cost of these acquisitions by the National Enterprise Board.
On the occasion when the Minister of State answered my hon. Friend the Member for Henley about the price at which any shares now owned by the NEB were acquired, he said:
"The National Enterprise Board has acquired the publicly-owned shareholdings named in the two statements which my right hon. Friend laid before Parliament on 27th February … In addition, the Board has acquired publicly-owned shares in Dunford & Elliott Ltd. for a consideration of £122,111."—[Official Report, 8th March 1976; Vol. 907, c. 69–70.]
That seems to indicate that there are still a number of holdings which have been acquired by the NEB from the Government for which acquisition figures are not available. I hope that on this occasion the Minister can enlighten us at least if not in part then as to the total cost which the NEB has incurred.
I have estimated that on the basis of the cost and current market values given in the answer to my hon. Friend the Member for Tonbridge and Mailing (Mr. Stanley) on 26th November last year, and on the basis of a valuation defined under the Industry Act 1975 in Schedule 2, paragraph 6, the cost of the holdings in the NEB must be between £350 million and £400 million. How is the NEB financing this? If it has already acquired shareholdings to this cost value and it has a public dividend capital of about £15 million, are we to assume that it has a debt element of about £385 million? I hope that the Minister will enlighten us on this matter.
Thirdly, I share the grave concern of my hon. Friends about the price at which

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these acquisitions were struck and, therefore, the cost—whether it be in the equity or the debt element—that has been incurred by the NEB. If the price at which the NEB acquire shareholdings from the Department of Industry is substantially below the original cost that the Government incurred in acquiring those shareholdings, I believe that this is nothing less than a sleight of hand, which is much to be regretted by hon. Members. It should not be possible, in my view, to pass shareholdings from one State body to another State body and somehow, by an accounting process, show that they have been acquired at a lower cost and, therefore, that the loss incurred to the taxpayer, or indeed, the potential profit—should they be disposed of later—is lesser or greater, as the case may be. I do not feel that it is proper to write off public debt in this way. It is behoven on the Minister to come clean about the basis of which shares are transferred. I appreciate the difficulties that arise in cases where these are not publicly-quoted shareholdings, but a firmer indication of the basis of valuation for those already passed and potential transfers is required before the House should sanction or approve this sort of payment.
Following up the point made by my hon. Friend the Member for Surrey, North-West, I must also ask this question: if we are to have a public dividend capital of about £15 millon, and if the NEB is able, under the Industry Act, to spend, in the near term, about £950 million, just how much is now left for Lord Ryder to spend? We were told in the White Paper on expenditure that the finance available for the NEB until 1980, some four years hence, has now been reduced to a maximum of £950 million. We also know that this is a money-terms cash limit, which even now is worth 25 per cent. less than the exactly same amount last year, when the Bill was in the course of discussion in the House.
We also know, as my hon. Friend mentioned, that £300 million of British Leyland's financing requirements will come from the NEB and that this will probably be a cost incurred in the shorter-rather than the longer-term Rolls-Royce will need £100 million of working capital this year. Chrysler—one must be realistic—has prospective losses of about £40
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million, which the NEB will have to stand, as well as the cost of a loan to that company of about £55 million.
If one adds up these figures including the acquisition costs, one finds that Lord Ryder has really been sold something of a dead duck and that all he has left under this magnificent Act to regenerate British industry is probably less than £100 million, which is an amount substantially less than that invested by many major public companies and certainly substantially less than his friends in the Tribune Group would like to have seen.
It seems to me that the NEB has certainly been a flop in terms of the Government's intentions, and that it has had to cut back very considerably on the proposed initiative which it was intended to make. Indeed, Dr. Stuart Holland, who was one of the NEB's original designers in 1973, has described it as 'a sell out'. Lord Ryder has approximately £500 million to play with, but I have suggested that after the acquisition costs the real amount that he will be able to spend on acquiring shareholdings in industry and trying to regenerate industry will be a substantially smaller sum. Therefore, how can one realistically look for a financial objective for the NEB? How can one say, for the public dividend capital which is itemised in the Supplementary Estimates, that the NEB will seek to make an adequate return?
One appreciates, therefore, the problems that the Government have had in devising a suitable objective for the NEB, and why the matter is still under negotiation. It seems to me to be the height of idiocy to set up a body, to promise it £1,000 million, to place requirements on it which mean that it will have to spend that money on acquiring loss-making concerns, and then to attach to it financial objectives that it cannot possibly achieve.
One can readily appreciate the chagrin of Lord Ryder and the members of the Board, who set out with such great hopes and whose affiliations with and loyalty to the Secretary of State for Energy—the former Secretary of State for Industry—have been dashed by a Government who have spent far more than the country can afford.
I hope that on this occasion the Minister will come clean and give us a proper breakdown of the costs and

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application of funds by the National Enterprise Board. I hope that there will be no false hopes or promises in future. We need a greater element of reality and prudence in public expenditure on behalf of our constituents, whose interest we are here to serve.
9.36 p.m.
The Minister of State, Department of Industry (Mr. Gregor Mackenzie): I am grateful to hon. Gentlemen on the Opposition side for the way in which they have put forward their arguments on a number of points.
First, I apologise for the absence of my hon. Friend and fellow Minister of State. As hon. Members know, he is engaged upstairs in Committee, not, as perhaps others might be, on other activities. I know that he will read the comments which have been made tonight. If I am not able to take all those points on board, I assure hon. Members that my hon. Friend will note them and will write to the Members concerned.
This is the first time since the establishment of the National Enterprise Board that we have had an opportunity to discuss its role. I welcome this opportunity because it gives us a chance of looking at NEB's role and the importance we attach to it in our industrial strategy.
The speeches by hon. Gentlemen have been reasonable, and I shall endeavour to reply in the same vein. I am puzzled when I hear hon. Gentlemen opposite say that they would like to scrap the Industry Act 1975, because I recall that they abolished the Industrial Reorganisation Corporation some time ago. I think that some of them later regretted that decision. Perhaps during their years in Opposition they will have an opportunity to reflect on the attitude that they are adopting towards the Industry Act and will adopt a new line towards it.
Mr. Michael Marshall: It is important to put on record that we have not suggested at any stage that we seek to abolish the Industry Act 1975. Our view is simple. We wish to see it amended to revert to the Industry Act 1972.
Mr. Mackenzie: I was thinking in terms of speeches made not tonight but during the passage of the Bill in Committee and later on the Floor of the House. The NEB has been in operation
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for only four months, but it is worth while looking at its record so far. I shall then deal with some of the questions which have been posed by hon. Gentlemen.
The NEB has made proposals, after consultation with the Machine Tool Trades Association, for a scheme under which the Board can provide finance on commercial terms to companies for building machine tools for stock. This proposal will benefit the industry, employment and, in view of the Board's expressed intention that its operations will be on commercial terms, the NEB. It will also benefit the economy as a whole as we move into a better economic climate by helping to avoid a bottleneck in the supply of machine tools. I am glad to tell the House that the industry has not been slow to respond to the Board's initiative and a number of proposals are already being accumulated.
It has been announced that the NEB is taking part in consortia which are seeking to secure major export contracts for this country. I am sure that nobody in this House, including Opposition Members, will wish to challenge the need for increased exports or the jobs that these produce.
It is far too early to assess the Board's record in its capacity as an industrial holding company. But I am sure that all Members of the House will welcome the announcement yesterday that, after its £125 million loss last year, British Leyland over the last five months has broken even. This is a tribute to both workers and management in British Leyland, to the efforts of the Board, in particular to its late Chairman, Sir Ronald Edwards, and to the excellent working relationship that the NEB has established with the company.
Mr. Grylls: Will the Minister go beyond British Leyland to the point about joining the consortia to help to obtain an export deal in the Middle East. Has that initiative—a new departure for the NEB—been successful, and will he say something about the present situation.?
Mr. Mackenzie: Perhaps, having reflected upon it, I will write to the hon. Gentleman on that topic. This might not be the time to go into too many examples.
I do not expect the Opposition to agree with everything that the NEB does, but the record of the Board to date justifies

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what the Government have said about the concept of the NEB as a new dynamic in the economy to complement and forward what is described as the macro-economic approach of Keynes.
Over the years our competitiveness as a nation, under successive Governments, has been undermined by a total inadequacy of industrial investment to create capacity and to increase efficiency and industrial competitiveness. We see the NEB as a major instrument for advancing the national interest in this area.
Against that background, I turn to the main subject under debate tonight—namely, the NEB and its relationship with its subsidiary companies. As foreshadowed in the White Paper "The Regeneration of British Industry", a number of Government shareholdings have been vested in the NEB. My right hon. Friend the Secretary of State for Industry announced on 1st March that we had authorised under Section 3 of the Industry Act the transfer of the Government's shareholdings in seven companies, including British Leyland Ltd. and Rolls-Royce (1971) Ltd. This transfer has now taken place and as a result the NEB now has a controlling shareholding in companies that between them employ a quarter of a million people.
In any debate on the National Enterprise Board it is right to say something about the guidelines. When my right hon. Friend the Secretary of State for Industry published the guidelines on 1st March, the hon. Member for Surrey, North-West (Mr. Grylls) said that the Opposition regarded them as reasonable. I am glad that at least on that matter we are in accord.
Mr. Grylls: We have not sought to raise the question of guidelines specifically today. We are now talking about the Supplementary Estimates for the NEB and its capitalisation. No doubt we can discuss guidelines on another occasion.
The Minister said that several companies were transferred to the NEB in terms of Government shareholdings. In the notice deposited by the Secretary of State under Section 5(5) of the Industry Act 1975, he referred to British Leyland Limited, Rolls-Royce (1971) Limited and Brown Boveri (Kent) Limited—all companies transferred from Government hold-
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ings to the NEB. No price has been disclosed and, therefore, we are not in a position to know the cost at which those companies have been transferred. It appears that a number of extra shares have been issued in respect of Rolls-Royce. There may be a simple answer to all this. But the taxpayer is entitled to know, if shares are transferred from one hand to another, especially out of the Government's hand to a body like the NEB, at what price the transactions are being effected.
Mr. Mackenzie: I do not think that it would be proper to comment on that at this stage. It is a matter which can be raised at a later stage. I have in mind the state that the discussions have reached. In any event, I promised the hon. Gentleman earlier that I would write to him on these matters.
I wanted to discuss the guidelines because they are a matter which have concerned Opposition Members, especially the hon. Member for Chichester (Mr. Nelson). It is important to remember in this respect that the hon. Member for Arundel (Mr. Marshall) asked me a number of questions, with which I hope to deal, especially about the relationship between the Government, Parliament and so on. We also gave assurances during the passage of the Industry Bill that we did not want to shackle the NEB. In view of the importance of it, however, it is right and proper that there should be a considerable measure of public accountability.
I was asked the number of times that the Chairman of the NEB was likely to meet the Secretary of State. I can assure hon. Members that there is no lack of contact between my right hon Friend and the Chairman of the NEB. They meet from time to time to discuss matters of common interest, as one would expect.
Another matter raised in this short debate was the answering of Questions in the House, in Select Committees, and so on. These are very much matters for my right hon. Friend the Leader of the House, and he will have taken note of the remarks of hon. Members. But I can tell the hon. Member for Arundel that the statement by the Leader of the House pointed out that it was an accepted practice of the House that Ministers did not

1675
answer Questions on the day-to-day business of such bodies. My right hon. Friend said categorically that the Secretary of State would be answerable as appropriate for the activities of the NEB in its capacity as a holding company and that he would be answering in the case of any directions to the Board in accordance with his powers to grant selective assistance, for example under the Industry Act 1972. If specific difficulties arise, we can look again at this matter.
The hon. Member for Arundel also asked for a breakdown of the £15 million proposed in the Estimate. By far the biggest single item is the payment of £7 million of public dividend capital to Rolls-Royce. In addition, a £3 million loan has been made to Rolls-Royce, but since this comes from the National Loans Fund it does not count against the Estimates provision.
Other items include the purchase of shares in Brown Boveri (Kent) and the administrative expenses of the NEB Organising Committee and of the NEB itself. A small sum is also needed for a company of which the NEB is a member to oversee the export project about which we talked earlier. Finally, there is an allowance for contingencies.
The NEB will publish and present to Parliament its annual report and accounts, as required by the Industry Act.
Mr. Grylls Mr. Grylls rose—
Mr. Mackenzie: I have been very reasonable in giving way, and I now wish to continue my speech because other Members wish to take part on later debates.
The hon. Gentleman also asked me about the autonomy of NEB subsidiaries. I agree that they must have the authority to do their jobs. The House will have welcomed the clear statement in the document setting out the relationship between the NEB and Rolls-Royce (1971) that the NEB has no intention of usurping the responsibilities of the board of Rolls-Royce (1971) or of intervening in its day-to-day management. A reading of the document, copies of which we have made available to Parliament, will show that the arrangements between the NEB and Rolls-Royce provide a workmanlike relationship between the two boards.
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The hon. Member for Surrey, Northwest asked me about undue preferences, and he particularly mentioned Coventry Climax. The NEB guidelines make clear the Government's intention that the NEB companies should not be given an unfair competitive advantage. They also say that the NEB is to avoid undue preference in its trading relationships, but it cannot keep its hands tied behind its back. Its companies must have proper commercial freedom. I am not in a position to deal totally with Coventry Climax, but I do not think anyone would say that commercial discount should be ruled out for companies just because the NEB has a shareholding in them.
The House will have welcomed the recently-announced improvement in British Leyland results—
Mr. Grylls Mr. Grylls rose—
Mr. Mackenzie: I have not been unreasonable in giving way, and the hon. Gentleman's last intervention was very long. I have no intention of giving way again.
Mr. Grylls: On a point of order, Mr. Deputy Speaker. I am not a very experienced participator in Consolidated Fund Bill debates, but I believe that we are fairly early and no great pressure is building up for many other debates to follow.
Mr. Deputy Speaker (Mr. Bryant Godman Irvine): That is not a point of order. The Minister has not given way.
Mr. Mackenzie: I have given way to the hon. Gentleman several times, and his last intervention was almost as long as his speech. Therefore, I believe that I am entitled to carry on without further interruption and answer the questions that have been put.
Mr. Robert Cooke: Surely the length of interventions is purely a matter for the Chair. It would not worry me if my subject did not come on for debate for a long time, if my hon. Friend wishes to intervene.
Mr. Deputy Speaker: I am much obliged to the hon. Gentleman, but the Minister was on his feet and will remain on his feet.
Mr. Grylls: On a point of order—
Mr. Deputy Speaker: The last matter that the hon. Gentleman raised was not a point of order. I am not prepared to consider alleged points of order which are not points of order.
Mr. Grylls: This is a fresh point of order, Mr. Deputy Speaker. The Minister referred to my point, and I wanted to make a short response.
Mr. Deputy Speaker: Order. That is a matter which is entirely in the Minister's hands.
Mr. Mackenzie: I thought that I had been not unreasonable in giving way. I have no intention of giving way again after the interventions we have already had. I want to answer the questions.
The hon. Member for Chichester asked me about the capital structure of the NEB. We have not yet settled it. It will need to reflect the progressive development of the NEB's activities. It will be a balance of loans and public dividend capital for Rolls-Royce, and current practice is a ratio of 70 per cent. dividend capital and about 30 per cent. loan capital.
The hon. Gentleman also raised a number of detailed financial questions about the NEB. I have not been able to take all his points on board. I shall write to him about these matters.
Mr. Nelson Mr. Nelson rose—
Mr. Mackenzie: The hon. Member for Arundel raised the whole question of relationships with Rolls-Royce and so on. The arrangements which govern the relationships between British Leyland and NEB have already been worked out. The NEB is responsible for reviewing British Leyland's annual operating plans and approving its capital investment programme. This embraces the financial performance of the company and of the separate business groups which comprise it, and also various key aspects of the company's actual performance. Naturally, the NEB will be reporting regularly to the Government on all these points.
The NEB will be receiving the long-range plans of both British Leyland and Rolls-Royce in the near future. The Board will discuss them with the company in the first instance. They will then be discussed with the Department. The NEB has made arrangements to receive information from these and its other subsidiary companies for monitor-
1678
ing purposes on a monthly basis. Matters arising from this will be discussed quarterly with the Department. This arrangement accords with good managerial practice.
Mr. Nelson: I feel obliged to raise a point of order.
Mr. Deputy Speaker: Order. We have had a number of points of order which are not points of order. I hope that the hon. Gentleman has in fact got a point of order—
Mr. Nelson: Mr. Deputy Speaker, it is your responsibility to protect the rights of Back Benchers, and we greatly respect it, on occasions during the Consolidated Fund, to raise specific points of which the Chair and the Minister have notice, and we reasonably expect some replies. May I ask your decision on whether we can continue this debate until we get some satisfactory replies from the Minister? I have not received a single answer to a question.
Mr. Deputy Speaker: One of the matters which are not my responsibility is the content of a Minister's speech.
Mr. Mackenzie: The hon. Gentleman may not like the replies, but he is getting them as I am going to give them to him. He has raised a number of points and I have replied to them, as I have replied to the points made by the hon. Member for Arundel and by the hon. Member for Surrey, North-West.
May I carry on by saying that the Government for their part will have to determine, after consultation with the Board, appropriate financial duties for the assets and activities of the NEB.
Paragraph 23 of the guidelines states:
"The Industry Act 1975 authorises the Secretary of State, with the approval of the Treasury, to determine different financial duties for the different assets and activities of the NEB. The Government will settle with the NEB separate objectives of its main categories of holdings, including individual objectives for the holdings in the very large companies such as Rolls-Royce or British Leyland, and will determine, in consultation with the NEB, into which category each holding will fall."
The Government will set these objectives in the light of the discussions with the NEB and will take into account the Board's views of prospects of the individual companies. Parliament will be informed of these objectives.

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I have outlined the broad arrangements which will form the relationship between the NEB and its subsidiaries. The Government believe that they reflect the best managerial practices and that they allow for the right degree of public accountability, without the need for oppressive intervention on the part of the Government.
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It is not for me to ask hon. Gentlemen on the Opposition side of the House to recognise the progress which the NEB has made. It has been operational for only a very short time, some four months. I believe they should consider the achievements of the NEB on their merits. They have a right to consider this very seriously, as we all do, and to ensure the success of the NEB in the future.

DEVOLUTION TO SCOTLAND
Mr. Deputy Speaker (Mr. Bryant Godman Irvine): Before we start the next debate, I would draw the attention of the House to the fact that it must be conducted on a very narrow front. It should be limited to the salaries and general expenses of the staff involved in the Government's plans for devolution to Scotland, and particularly the Constitution Unit in the Cabinet Office.
10.0 p.m.
Mr. William Hamilton: I am well aware, Mr. Deputy Speaker, that the debate has to be a very narrow one, confined to expenditure on the Cabinet Office Constitution Unit, which I presume is included in Class XIII, Votes 21 and 22, and I shall try to relate my remarks to those matters.
Those Votes make no specific mention of the Unit. Neither its costs nor its staffing are given. They are hidden in global figures which are probably small but in inverse proportion to the importance of its work. The total cost of the Cabinet Office, according to these figures, was £3,046,000 in 1974–75 and £3,381,000 in 1975–76. Is that increase simply because of inflation or because more intensive work is being done, or is the Unit getting on more quickly or in greater depth with its investigations into the implications and complications of this exercise?
I may be wrong, but I think that Lord Hunt is now the head of the Constitution Unit. I do not know whether his salary is included in the Vote. We do not know how he is operating or thinking but we do know that he recently expressed himself in favour of a referendum of the Scottish people—and presumably the Welsh and English people—on devolution before legislation. I suspect, I expect, I hope, that Lord Hunt's views will be taken into account by the Unit over which he presides. Yet the Government have said that they are against referenda, although they are favoured by the head of the Unit whose cost is the subject of this debate.
Every public opinion poll on this matter has shown that we Scots do not want complete separation. I presume that this Unit has ruled out the possibility
1682
of complete separation, yet that is the kernel of the policy of the SNP. I am glad that the sole representative of that party tonight is the hon. Member for Reid), because on 4th February 1975 he Reid), because on 4th February 1975, he said:
"The aim of my party is clear. It is the restoration of national sovereignty to the people of Scotland and, ultimately, the withdrawal of all Scottish Members from this House."
He went on to say:
"It makes sense to have a Scottish Treasury and a Scottish Consolidated Fund."—[Official Report, 4th February 1975; Vol. 885, c. 1218–19.]
It is quite clear, therefore, that the hon. Gentleman has aims other than those of the Government and of the Constitution Unit, the cost of which we are debating tonight.
It is quite clear that the Constitution Unit would be wasting its time, its staff and our money if it were to discuss and probe the consequences of the complete separation advocated by the hon. Gentleman, either now or in the foreseeable future. The Paymaster-General spelt out the reasons in his speech in West Lothian on Saturday 13th March. It was a devastating demolition job. In that speech he showed with frightening clarity how the SNP's policy of separation could be damaging to both Scotland and England—to the whole of the United Kingdom.
My right hon. Friend gave figures, produced not by the Department but by Dundee University, showing that between 1961 and 1971 Scotland had a balance of payments deficit in goods and services of about 10 per cent. of gross domestic product, roughly three times higher than the average for the United Kingdom over the whole of that decade. He referred specifically to oil, and I see that in this Vote the salary of the Chancellor of the Duchy is referred to. The Chancellor of the Duchy is dealing with the oil companies and presumably vetted the speech by the Paymaster-General on that occasion.
When the Paymaster-General made that speech, he assumed what is really an impossibility, and the hon. Member for Clackmannan and East Stirlingshire, who now sits very lonely on the SNP Bench, is sufficiently intelligent to know that it is an

1683
impossibility—that all the oil revenues will accrue to Scotland. He must know that that is a sheer impossibility. When Margo McDonald appeared on television a month or two ago, she said that it was non-negotiable, and, by Heaven, she is right. We know it, they know it, everybody knows it.
For the sake of the argument, however, the Paymaster-General assumed that all oil royalties would go to Scotland. He conceded that in that unlikely event the balance of trade deficit could be removed and eventually converted, but he went on to state facts of which we are all aware: that the oil is a finite resource and that it will run out at some time; its future price is unpredictable; it is extremely costly to produce and is getting more costly every day; and if the OPEC cartel decides to reduce the oil price, the profits from North Sea oil will plunge catastrophically.
The Unit must be aware of these matters, and that is why it is ruling out consideration of separateness, because any economy based, as the Scottish economy would be based, on one product is extremely vulnerable to international forces completely outside its control. Examples are to be seen all over the world, especially in the underdeveloped world. Such an unbalanced economy could well result in increased inflation. A serious increase in unemployment would result from the need to redeploy labour from industries such as those in the constituency of my hon. Friend the Member for Dunfermline (Mr. Hunter). If Scotland became a one-industry economy, the coal industry would have a pretty thin time. There would be massive unemployment in the coal industry, to say nothing of the dock which my hon. Friend represents.
Mr. James Lamond: Perhaps my hon. Friend will draw attention to the area which I represent, the North-West of England, which for many years depended almost entirely upon the textile industry and suffered badly when it declined, when over 750,000 people lost their jobs.
Mr. Deputy Speaker: Order. I must encourage the hon. Member for Fife, Central (Mr. Hamilton) not to follow
1684
that road too far. We are discussing the Constitution Unit of the Cabinet Office.
Mr. Hamilton: The Constitution Unit deals with the whole of the constitution. Every region in Britain is involved. That is why my hon. Friend the Member for Oldham, East (Mr. Lamond) is here. My hon. Friend is an Aberdonian. He is the Lord Provost of Aberdeen, but he represents an Oldham constituency. We in the Labour Party do not give a damn where a fellow is born. What counts is that for which he stands. My hon. Friend is a Scot, and we are glad to have him representing an English constituency. I was not born in Scotland but I represent a Scottish constituency. That is how our internationalism works.
The terms of reference of the Constitution Unit are not so narrowly drawn that the Unit is to devote all its resources to devolution to Scotland and Wales. No doubt my hon. Friend will try to catch your eye, Mr. Deputy Speaker, to discover how much of the Unit's resources are being spent on considering the problems of devolution to the North-West, the area which he represents. It is right and relevant to put that question.
My hon. Friend has posed an economic problem that concerns areas of the United Kingdom other than Scotland. It is a United Kingdom problem, it does not relate exclusively to Scotland and Wales.
I return to the predictable, hysterical and ignorant outburst of that renowned and brilliant economist, the hon. Member for Perth and East Perthshire (Mr. Crawford), the official economics spokesman of the SNP. It seems that the hon. Gentleman has gone home to his bed. He started from an impossible assumption that is accepted by only few people in Scotland—namely, that oil revenues would accrue immediately to the Scottish people and would continue to accrue for an indefinite period.
Mr. Hector Monro: Will the hon. Gentleman make it clear whether the speech of the hon. Member for Perth and East Perthshire (Mr. Crawford) was actually made or whether it was a phantom speech that might have been made?
Mr. Hamilton: Yes, the hon. Gentleman has been known to publicise the gist of speeches that were never made. He puts out statements to the Press which he alleges to have made in debates in the House when he was never even present for the debate. That is the sort of thing that we get from the SNP. However, that is to stray from the subject of the debate. I wish to stick narrowly to the Vote before us.
The hon. Member for Perth and East Perthshire talked about a strong Scottish pound. I shall quote from the Glasgow Herald. He said:
"the costs of our imports will be stabilised."
In God's name, how can we do that? The hon. Gentleman makes that bare statement and leaves it there. But how can we control the cost of imported oil, cotton, rubber or any other commodities?
The Government and the Constitution Unit are presumably still receiving representations on the contents of the White Paper. Is the Unit, of which my hon. Friend the Under-Secretary is a distinguished member, taking fully into account the views of the Scottish CBI which were published on 1st March? The CBI says:
"speaking as we do on behalf of industry as a whole in Scotland, we are bound to express the view that the elected Assembly is unnecessary from industry's viewpoint. As proposed"—
in the White Paper and this wretched Unit—
"it could lead to confusion, dispute and delay in decision-making on matters which affect business. Due to the importance of these proposals to the United Kingdom, we would wish to see two draft Bills in place of the joint Bill currently being proposed."
The CBI goes on to welcome:
"the emphasis placed on the need to safeguard the economic and political unity of the United Kingdom"—
That is what the Unit is seeking to do. The CBI also
"seeks an assurance that the cost of the Government's proposals have been accurately assessed"—
I shall come back to the cost, because it is directly relevant to the Vote—
"points to the risk of Scotland becoming over-governed, to the possible cost and adverse effect on industry of an over-complicated Government machinery and advocates that the Government should re-evaluate the likely true cost of its proposals".
1686
I mean to press the Under-Secretary on this matter. He and I addressed a meeting in Fife recently, and in answer to a question he said the cost was about £10 million. The CBI and I very much doubt whether that is remotely like the figure for the eventual cost.
The CBI representations continue:
"Defects in the proposals to empower the Assembly to levy taxation are highlighted; a crucial omission from sources of finance is pointed out and a more up-to-date system of public audit and financial control is advocated".
I hope that the Government are looking at a system of financial control and public audit as recommended by the CBI. More important, the CBI regrets the cursory treatment accorded to EEC considerations thoughout the White Paper, and that is a fair point.
I think that most hon. Members are agreed on the question of unity. The Scottish CBI document further states:
"This is of overriding importance to industry in Scotland and therefore to Scotland as a whole. The interests of British industry in Scotland are indistinguishable from and inextricably bound up with those of industry throughout the United Kingdom; and with the growth of European integration it is imperative to preserve the cohesion of British industry as a powerful force at home and abroad on whose success in creating new wealth depends the possibility of further political and social advance in the United Kingdom. The CBI strongly urges therefore that in proposinig new political institutions this underlying principle must never be lost sight of by the Government and the political parties."
It must not be lost sight of by the Constitution Unit, for which my hon. Friend the Under-Secretary will be speaking in due course.
My right hon. Friend the Leader of the House this afternoon said that the draft Bill was ready and was being studied and that it would be produced, presumably, very soon. I do not know how soon that will be. But that is not by any means the end of the story—in fact, it is scarcely the beginning. The CBI document goes on to emphasise that after publication of the draft Bill the Scottish CBI and no doubt others may wish to comment further on the composition and constitutional basis of the elected Assembly and on other points.
On the last page of the CBI document it is stated that

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"So far as the CBI's own consideration of the devolution proposals is concerned it is intended to refer some of the issues which are raised in the White Paper to specialist committees and panels for more detailed study. These specialist considerations could relate to such subjects as education, rating and valuation, Local Government finance, pay in the public sector—and a number of other issues."
It is quite clear from this that the Scottish CBI, the Scottish TUC, all the political parties and all the professional organisations in Scotland have virtually all come already to the same conclusion—that they do not want separation as advocated by the SNP. I do not know of a single responsible body anywhere in Scotland which has come to that conclusion. Neither have public opinion polls nor anyone else.
The Parliamentary Labour Party has been having lengthy discussions on the White Paper. I do not think I am revealing any secrets when I say that it has completed them only this evening and that it proposes radical changes in the White Paper. So, too, does the Scottish Executive of the Labour Party.
All these matters will be further thrashed out at our party conference at Troon later this month. Then there will be a long and bitter, controversial and extremely costly and dangerous haul in front of everybody in this House and in front of the whole of the Scottish people. It will flow over party boundaries and national boundaries. It is very much a United Kingdom matter.
It would be a very bold, rash, and, I think, ill-advised Government could pretend that they could adhere to any kind of strict timetable. Whatever may have been promised in the past, circumstances have changed. They have changed even in the last 72 hours.
We shall very soon have a new Prime Minister. It might even be me. The party could do worse, I suppose. The new Prime Minister will be installed very soon, and he will want time to play himself in, to change his team, perhaps abolish some of it, or to change the composition of the Constitution Unit and reduce its costs. At any rate, there will be changes which will take a great deal of time.
Perhaps after six or 12 months the new Prime Minister will decide that he wants a new mandate from the people—
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an election mandate—before any Assembly legislation is passed. That would be a good, sound, democratic principle which I am all in favour of. I would not fear the result either personally or, when I look at the Opposition, for my party. The Liberal Party is in some sort of state at present. The Scottish Nationalist Party Members are a bunch of incompetents who are unscrupulous at times. The Conservative Party has nothing to offer. Indeed, we are desperately hoping, for the sake of democracy, that it will strengthen itself and pull itself together.
Whatever happens, I do not believe that in the present situation there is any prospect of getting legislation about the Assembly before the next General Election. However this depends so much on the next Prime Minister and when he calls an election. I shall not shed any tears if that is what happens.
I do not think that the British public would care too much. It will judge the parties at that time not on whether there is an Assembly in Scotland or Wales but on whether the dole queues are down and the rate of inflation is seen to be under control. Those are the matters that count. Afterwards, we can all settle down cosily, coolly, calmly and with less hysteria and emotion to examine in great detail the problem that this Constitution Unit is playing around with now.
There needs to be more consideration, and the CBI recognises this in its memorandum. An increasing number of organisations are coming to realise how serious and fundamental are the constitutional implications of this exercise. It ill behoves any Government to try to speed it up for any kind of political opportunism.
I end where I started. Although this appears to be a small Vote, the exercise upon which we are embarked is extremely important and we must take a great deal of time to make sure that we get the right answer rather than the quick answer.
10.28 p.m.
Mr. Iain Sproat: I congratulate the hon. Member for Fife, Central (Mr. Hamilton) on the excellent sense of his speech. It is not often that an Opposition Member can agree almost totally—apart from a few unfortunate strictures on the Conservative Party

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which no doubt slipped out by mistake—with what a Labour Member has said and can congratulate him on his speech. My only surprise was that the hon. Gentleman made such a short speech. I assure the Government Whip who is present in the Chamber that the brief speeches we are making tonight will be as nothing compared to the speeches that we shall be compelled to make on this vital issue in the future.
The hon. Member for Fife, Central said he did not believe that this legislation would ever get through the House. He is absolutely right. I do not suppose there is any hon. Member present who would foresee a General Election much further than two years in the future. That would not be nearly long enough to get through the House any Bill which changes the constitution of the United Kingdom as radically as we understand the Constitution Unit is proposing. Therefore, I ask the Government Whip to take note of what we are discussing and the brevity with which we do so.
I am absolutely astonished to see no one but the hon. Member for Clackmannan and East Stirlingshire (Mr. Reid) on the Scottish National Party Bench. We all known that the only raison d'etre of the SNP is separation, and yet this debate on the Constitution Unit, which is the one thing, if anything, which will lead to separation if it is given its head, the SNP Members are not here. It is astonishing. Perhaps tomorrow we shall read in Hansard a phantom speech by the hon. Member for Perth and East Perthshire (Mr. Crawford), or perhaps we shall see headlines in the Scotsman explaining how he slayed the House of Commons with a wonderful speech. Phantom eloquence is a wonderful commodity.
Like the hon. Member for Fife, Central I acknowledge that we are tonight discussing a relatively small amount of money. But what about the expenditure which is hidden away in the global sum? My memory is that the cost of the Constitution Unit will be about £239,000, but I speak from memory and I am prepared to be corrected. That shows the House what we would be in for in this whole foolish time and money-wasting Scottish and Welsh Assembly exercise. Here we are, in a period of extreme financial stringency, spending nearly £¼
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million of taxpayers' money to set up the new Unit. It serves notice of what the Scottish and Welsh Assemblies—and, no doubt, the assemblies for the various English regions—will cost.
How many extra civil servants have been taken on for the Constitution Unit in order to service this nonsense? Will the Minister tell me, since this has been the subject of some debate over the last few weeks, whether the salary of the assistant to the Lord President comes within the sum we are discussing tonight and whether he is prepared to tell the House how much the Lord President's assistant is actually paid?
The figure of £239,000 is a pointer to what is to come. The White Paper told us that the approximate cost of the Scottish and Welsh Assemblies was to be £22 million. The one certain thing in this uncertain world of politics is that if any Government—Labour or Conservative—say that something will cost £22 million, it will eventually cost two, three or four times that figure.
Already at a time of extreme economic crisis, when the fishermen of Aberdeen think that they are going out of business for the loss of £4 million, we plan to spend on a miserable bunch of Assemblies perhaps £100 million, and that does not cover the English assemblies. Are we mad to do this at a time of economic crisis when we should be, and are, tightening our belts? We could all point to schools, hospitals, housing programmes and roads that are having to be cut. We are telling the people that we do not have enough money for the necessities of life, yet here we are spending £239,000 to set up a Unit which will tell us that it will spend £100 million on Scottish and Welsh Assemblies. That Unit is about to come forward with the cost of English regional assemblies. I am quite certain that the hon. Member for Oldham, East (Mr. Lamond), in his new persona as a Member of Parliament for an English constituency, would not allow us to have an Assembly in Scotland and allow the conurbation around him to be unrepresented. That would be totally unfair.
Therefore, the Constitution Unit will have to spend even more money. No doubt the Minister will tell us that it has already spent a lot of time deciding what to do about the English assemblies. That

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Unit has told us that Scottish and Welsh Assemblies will cost £22 million. If we extrapolate that sum on exactly the same basis—I do not believe that we can, because it is an under-estimate—English assemblies would cost £140 million.
Therefore, already we are talking about a minimum of another £160 million or £170 million a year to be paid for by the British taxpayer. Is that the sort of sum we should spend? Is the Constitution Unit spending that £239,000 of British taxpayers' money wisely in producing that sort of rubbish? In my opinion it would be crazy at any time, but especially now when we are in debt up to our ears and when we are having to cut down all round on our welfare programme. It is the height of madness that this Unit should be set up—itself an expensive exercise—to produce even more expensive exercises.
If £22 million is the estimated cost of the Scottish and Welsh Assemblies, they may cost £100 million by the time we are finished and the various regional assemblies in England may cost £150 million.
Mr. Deputy Speaker: I am not convinced that the regional assemblies in England are relevant to what we are discussing at the moment.
Mr. Sproat: I take the point, Mr. Deputy Speaker. It is extremely difficult to know when one strays and is out of order. I understand that at this very moment the Constitution Unit is producing a paper on the English regional assemblies. Therefore, the cost of what it produces should be relevant to this debate. However, I shall leave that point.
I shall be surprised if this exercise of Assemblies for Scotland, Wales and England costs the taxpayer anything less than £250 million extra a year. The Constitution Unit proposes not merely that we fork out the money now but that we fork it out for the Assemblies in the future. It wants the Assemblies to have the power to tax us even more. Therefore, the British taxpayer will have to pay to keep in being a body that will demand that we pay more. The White Paper proposes that the Assembly should have the power to levy local taxes. The wretched citizens will be hit over the head yet again. Not only will it cost £250 million to set these bodies up, but
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they will have the power to raise even more taxes. We shall be in an intolerable position.
The fruit of the Constitution Unit will be more government when we should have less and better government, more expenditure when we have to cut expenditure all round, more taxes when already the Chancellor of the Exchequer has said that we are an over-taxed country and that there is not enough incentive because taxes are too high, and more civil servants, bureaucracy and red tape. I should have thought that it was common ground between all sensible hon. Members that already taxes are too high and civil servants too many, yet here we are wasting all our time at this hour of the night discussing the work of a Unit which proposes more government, more taxes, more public expenditure and more civil servants. It is absolutely ridiculous.
The hon. Member for Fife, Central made a good point about the balance of trade deficit and the work that the Unit must do on this. He quoted a series of figures. I think that it was the Paymaster-General who produced them. The hon. Gentleman is quite right. He mentioned the figure of 10 per cent. of the gross domestic product, or something like that.
The only trouble with those figures is that no one understands what 10 per cent. of the GDP means. We can have people such as the phantom Member for Perth and East Perthshire talking about a strong Scottish pound, but no one knows what it is. However, if one says that 10 per cent. of GDP is a minimum of £537 million a year and that that is Scotland's balance of trade deficit every year, perhaps one will bring this matter home a little more. If the Unit were doing its job properly, that is the figure that it would be hammering home.
Instead of the Unit wasting time speculating on how Assemblies in England, Scotland and Wales should be set up, I should like to see it emphasising to the people the real advantage of the constitution, which is the unity of the United Kingdom. I would not mind paying my contribution to the £239,000 a year if I thought that that was what the Unit was doing. But, alas, it is not.
Again, as well as emphasising the balance of trade deficit that Scotland suffers annually, about £537 million, I

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should like to see the Unit spending more of its time in emphasising what Scotland already gets from the Treasury. It is extremely difficult to get this information from the Treasury. I do not know why, but every time I ask the Treasury I am told that this is too difficult to work out. However, we know that identifiable public expenditure in Scotland is about £3,700 million a year. I speak from memory, but that is the rough figure. We also know that Scotland gets about 20 per cent. more out of the United Kingdom Treasury than she puts in by way of tax. Last year it was 19 per cent., and the previous year it was very much more.
That means, in effect, that Scotland is being subsidised. I do not shrink from the brutal fact. I wish that more people in Scotland would wake up to the brutal fact that Scotland is being subsidised by England every year to the tune of about £800 million. That is the sort of fact that the Unit should be putting forward.
I hear the usual sniggers and laughs from the rather depleted SNP Bench. No doubt if SNP Members were here doing their duty the laughter would be even louder. But they are not here. They are either snoring on the way up to Scotland or making speeches in Scotland while we are here doing our duty.
Mr. William Hamilton: Or issuing statements to the Press.
Mr. Sproat: No doubt, as the hon. Gentleman says.
The Constitution Unit ought to be spending its time and money on emphasising to the people of Scotland the figure of £800 million by which they are subsidised every year. While the Unit is doing that, by all means let it mention the great contribution Scotsmen and Scotswomen have made to the United Kingdom in terms of their ability and brains, as the inventors or discoverers of coal-gas, sticky stamps, pneumatic tyres, tarmacadam, television, logarithms, the steam engine, the breach-loading rifle and all the other great contributions that the brains and ability of the Scots have made to the United Kingdom.
But let not the Unit or anyone else try to say that today that contribution is in money terms. It is not. It may have been in the great days of Clyde-
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side. In the days of heavy engineering in Scotland, we made a greater contribution than we do now. No doubt in the future, thanks to North Sea oil, once again Scotland will make a financial contribution. But that is not so at present.
I should like to see the Unit spending more time spelling out to the people in all parts of the United Kingdom the advantages that Scotland receives from her membership of the Union. Again, the hon. Member for Fife, Central very shrewdly pointed out that we were talking about the salary of the Chancellor of the Duchy of Lancaster. He also referred to the speech—no doubt vetted by the Chancellor of the Duchy of Lancaster—that was made by the Paymaster-General in West Lothian last weekend. It was an extremely good speech. I wish that more hon. Members would take such a robust and sensible attitude towards it.
The Paymaster-General, with his speech vetted, no doubt, by members of the Unit which we are discussing, pointed out the true position regarding North Sea oil. What is the true position? We cannot say exactly what North Sea oil will bring into this country, because we do not know the price. The price may fall. Who knows what will happen to the various Arab Governments on which we depend for the price?
Let us assume, as is common ground between the two Front Benches, that the approximate sum will be in the region of £3,000 million a year from North Sea oil. We know that two-thirds of our North Sea oil lies off the coast of Shetland. The Shetlanders have made it clear, above all, that if there is a Scottish Assembly, if there is any independence, they will not be attached to an Edinburgh Assembly or Edinburgh as the capital of an independent Scotland but will stay with London. So, of that £3,000 million, we can cut off at a stroke, if I may coin a phrase, £2,000 million. Therefore, we are left with only £1,000 million. But even that £1,000 million would not accrue to an independent Scotland, because if the frontiers of England and Scotland were projected out to sea in the normal manner in international relations—namely at 38 degrees—the effect would be to chop off the three southerly oilfields.
Mr. Deputy Speaker: Order. The hon. Member must come back to the salaries of the Unit, which is what we are discussing.
Mr. Sproat: This is a difficult debate for all of us. My point is that we are discussing the salary of the Chancellor of the Duchy of Lancaster, whose main job is regulating North Sea oil. That is a most important job. In that job he must have regard to three fields in particular—Auk, Josephine and Argyll—which would not fall within the Scottish sector. We would have to chop those off. We are, therefore, talking about £700 million a year, which is less than the balance of taxes that Scotland gets from England. We would be worse off.
Mr. Deputy Speaker: Order. Will the hon. Gentleman look at page 414 of the Supplementary Estimates and instruct himself on what we are in fact discussing?
Mr. Sproat: I do not have the document with me.
Mr. William Hamilton: Perhaps the hon. Gentleman will allow me to help him. In the Supply Estimates 1975–76, Class XIII, Vote 21, "Other Services: Cabinet Office", there is an item
"Al Cabinet Office. (1) Salary of the Chancellor of the Duchy of Lancaster £11,000."
It was static in 1974–75 and in 1975–76. My right hon. Friend is setting a good example to others who are putting in for wage increases. There is a note to the effect that this is additional salary payable to the Chancellor of the Duchy of Lancaster in accordance with Schedule 3 to the Ministerial and Other Salaries Act 1972. Clearly, the Chancellor of the Duchy of Lancaster is getting that salary for dealing with the oil problem in the North Sea.
Mr. Sproat: That was certainly my understanding. I read it closely last night I took advice from the Clerks of the House on the matter. I shall not pursue this question further than to say that £700 million from North Sea oil to an independent Scotland would not even pay for the balance of expenditure over taxes which we get now.
As for the idea that we could finance an independent army, navy, air force, diplomatic service and customs post, I should point out that Sweden, which is often held up to us as an example of what an independent Scotland could aspire to, spends £1,100 million on its army every year, which again the—
Mr. Deputy Speaker: Order. I must ask the hon. Gentleman to borrow a copy of the Supplementary Estimates and to look at page 414. There is nothing there about Sweden either.
Mr. Sproat: I am sorry, Mr. Deputy Speaker. I shall immediately return to the Constitution Unit.
The Lord President was in Aberdeen 10 days ago. We were pleased to have the head of the Constitution Unit there because it is well known that Aberdeen and the Grampians Region are totally opposed to a Scottish Assembly. We hoped that we would be able to persuade the Lord President of that and get him to justify his salary. I was amazed to be told that during that meeting at the University of Aberdeen it became clear that the Lord President was apparently unaware that Shetland had said that it would have nothing to do with a Scottish Assembly or an independent Scotland. Something is amiss in the Constitution Unit. Perhaps it is not getting enough money to enable it to take these representations on board.
I ask the Minister, who I know was in Aberdeen and made a good impression with his open-mindedness, to tell his right hon. Friend that Shetland has made clear where it stands, with the result that its attitude would wipe out two thirds of North Sea oil revenue for an independent Scotland. Has the Constitution Unit received representations from the Aberdeen Chamber of Commerce, which this week made it absolutely clear that there is no way in which it would accept a Scottish Assembly? My impression was that it would sooner declare UDI than accept domination from Strathclyde—
Mr. Deputy Speaker: Order. Irrespective of whether representations have been received, we are discussing the salaries of the Cabinet Office.
Mr. Sproat: I am trying your patience, Mr. Deputy Speaker. Perhaps I have made my point. I shall discard at least 80 per cent. of the speech which I had prepared and ask the Minister to take on board the fact that there is no way that he will get an Assembly Bill through this House. There is not the support for it. Let him tell that to the Constitution Unit. I am sure he will find that there are those behind him who will agree with me that

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the Unit is wasting its time and the taxpayers' money in pursuing these fashionable ideas, which, like so many fashionable ideas, will fade—as I am sure the SNP will shortly fade.
10.53 p.m.
Mr. James Lamond: This is the second occasion in recent weeks when I have had the pleasure of addressing the House immediately after a speech by the hon. Member for Aberdeen, South (Mr. Sproat), who is my Member of Parliament. His speech reflects the views of at least one of his constituents with uncanny accuracy. There was not a word in it with which I would disagree. I can assure the hon. Member of the same support at the next election as I gave him at the last one.
It is no coincidence that the tenor of the hon. Member's speech was as it was. The area he represents is seriously concerned about the working of the Constitution Unit, the cost of which we are discussing. There have been many indications from that area to which I hope the Unit will give full weight. It is unfortunate that the sole remaining member of the Scottish National Party who could summon the energy to attend the debate has now departed—presumably to present the Press with a copy of some speech he will be claiming, perhaps, to have made in the House.
Therefore, the news of what has been going on in the House tonight and about these important discussions concerning the Constitution Unit, the expenditure on it and its work will have to be carried to the people of Scotland and elsewhere in the United Kingdom, where there is great interest, by members of the Conservative and Labour Parties. No first-hand news can possibly be conveyed by Members of the SNP, but no doubt that will not deter them from giving their advice to the people of Scotland based, as usual, on a complete lack of knowledge of the matters about which they are speaking.
What worries me about this Vote is not that it is too large but that possibly it is not large enough to cover the work which the Constitution Unit will need to do if it is fully to discharge its brief. To begin talks about the devolution of Scotland and Wales is like dropping a pebble into a pool. The waves begin in a small way. They are of great interest to
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the people of Scotland and Wales. But the waves increase in circumference as the knowledge of the talks grows throughout the United Kingdom.
I am sure that this Constitution Unit is designed to serve the United Kingdom. The money that we are spending on it is raised from taxation throughout the United Kingdom, and it must be used for the benefit of all the people, including my constituents in Oldham, East. Gradually, people throughout the whole of Britain will become interested in devolution and how it will affect the areas in which they live.
It is very interesting, Mr. Deputy Speaker—I beg your pardon, Mr. Speaker—
Mr. Speaker: I do not mind any longer!
Mr. Lamond: I am sure you will share my hope that this Constitution Unit will receive information from all parts of the United Kingdom, just as I have been doing. For example, I have received a letter from the North-West Industrial Development Association. I refer, of course, to the North-West of England, not the North-West of Scotland. I refer to the Manchester area, part of which I represent. That Association has been giving great consideration to the implications of this Constitution Unit and the effect that the Government's proposals will have on the United Kingdom. It has come out strongly against any proposals to have an Assembly in Scotland—
Mr. Speaker: That may be, but we are now discussing the salaries of the Unit.
Mr. Lamond: You are correct, as always, Mr. Speaker. However, I hope that those salaries, which are paid by the taxpayers in my constituency and the constituencies of other hon. Members, are being used in the interests of my constituents as well as those of the people of Scotland and Wales.
The main basis of the complaint of my constituents is that they already carry a very considerable degree of taxation the purpose of which is to assist Scotland and Wales, and they are not happy about having further burdens added to them without their views being fully considered by the Constitution Unit.
The Government's proposals have a very serious effect on the area which I

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represent. For instance, I hope that the Constitution Unit will take into consideration relevant statistics such as the fact that the people of Scotland have a higher average wage than people in the North-West of England, that the unemployment position in Scotland is healthier than it is in the North-West of England and that the people of Scotland already enjoy very much superior representation at Cabinet level than do my constituents in the North-West. Although many distinguished right hon. and hon. Members come from the North-West, including the Prime Minister, we have no direct voice in the Cabinet such as the Scottish people have in the Secretary of State for Scotland and the Welsh people have in the Secretary of State for Wales.
Mr. Speaker: Although the hon. Member is doing his best—and it is a very good best—I must remind him that only the reasons for the increase may be discussed and not the policy implied in the original Estimate.
Mr. Lamond: The reason for the increase is that the Constitution Unit is expanding its work to include representations from my constituents, the North-West Industrial Development Association and the economic committee in the North-West which is a separate body on which there are representatives from the Liverpool and Merseyside area who have expressed views similar to those of the Industrial Development Association. They are determined that there shall be no further improvement in the position of Scotland relative to the rest of the United Kingdom.
Mr. Speaker, I can see that I am causing you some concern, so I shall come directly to the salary of the Chancellor of the Duchy of Lancaster. His salary has not been increased.
Mr. William Hamilton: The Chancellor of the Duchy of Lancaster has some influence over the Constitution Unit.
Mr. Speaker: I must remind the hon. Gentleman that this is a saving on the salary of the Chancellor of the Duchy of Lancaster and that it would, therefore, be out of order for the hon. Gentleman to discuss his salary.
Mr. Lamond: I accept your ruling, Mr. Speaker, but it is strange that we are allowed to comment on increases in salary
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while the more worthwhile matter of a decrease in salary must pass without comment.
Mr. Speaker: This is a strange place, and the hon. Gentleman has accurately described the position.
Mr. Lamond: The salary of the 649 staff in the Cabinet Office is mentioned in the Vote and, as one would expect, there are increases. The salaries etc.—presumably that includes such things as expenses—of the staff this year total £3,147,000 compared with £2,822,000 in 1974–75. That represents an increase of about £300,000. It is an increase, and perhaps I might comment on that. The Cabinet staff must include personnel who are concerned about the matters that we are discussing. I am sure that the Chancellor of the Duchy of Lancaster, able and knowledgeable though he is, must have some staff assisting him in the valuable work he is doing on the oil industry, which must also play an important part in the discussions of the Constitution Unit.
The oil extraction industry has developed a great deal in my beloved native city. The people in the area are the least enthusiastic in all Scotland about even the Government's modest devolution proposals. There was an interesting article in the Financial Times, which I am sure the staff of the Cabinet Office who are concerned with the oil industry will have studied carefully, giving a very different picture of the future prosperity of Scotland if it depended entirely on the oii industry.
I echo the cautionary remarks of my hon. Friend the Member for Fife, Central (Mr. Hamilton) who drew attention to the difficulties which always arise when a country is financially dependent on one industry or one source of finance. No one would wish to see Scotland experiencing such difficulties. Even as an English Member, I should not like to see the Scottish people suffering as many areas, including the North-West of England, have suffered because they depended too much on one product.
I finish on that point.
Mr. Speaker: Very good.
11.7 p.m.
Mr. Hector Monro: It is a pleasure to follow two Aberdonians,

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although they are apparently on opposite sides of the fence in this debate.
I am not quite clear about your strictures, Mr. Speaker. In Vote 21, Class XIII, there is an increase of £402,000 in expenditure on the Cabinet Office and in Vote 22 there is an increase of £386,000 for the Scottish Office. Both increases relate to the subject we are discussing—the Constitution Unit. But I hope that I shall keep strictly in order, and I shall be brief.
I made some flippant remarks about Aberdeen going in for UDI because of dissatisfaction about devolution, but I am not really contemplating that, because Aberdeen's contribution to the Scottish economy is something we could not forgo.
I come to the expenditure on the Constitution Unit. I am very much in favour of a Scottish Assembly and devolution to Scotland. I am highly critical of the Scottish National Party for wishing to use it as a stepping-stone to separation, which I entirely oppose, as we must keep the United Kingdom one unit.
Mr. Speaker: That is very interesting, but the debate must be limited to the increase in salaries and general expenses of the staff engaged in the Constitution Unit.
Mr. Monro: I accept that, Mr. Speaker, but I must say where I stand.
My first point in relation to the cost of the Constitution Unit is a point made by the hon. Member for Oldham, East (Mr. Lamond), and that is whether it is sufficient to carry out the work that it is presently required to do by the Government. We are intending to legislate in the near future not for the short term but for the rest of the century and, perhaps, the subsequent century. We must get the facts right and the policy right when the Government introduce a Bill for devolution. Is the Minister satisfied that he has the resources and the staff necessary to carry out the work in preparation for the Bill which the Constitution Unit, through the Government, will present in the comparatively near future?
Secondly, a series of Government answers to Questions over the last three months shows a difference of opinion on how many staff there are in the Constitution Unit. In December we were told that the Cabinet Office increase was 182,
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and yet in relation to the Scottish Office subsequently there seems to have been an increase of something over 300 over the last five years. Yet again my hon. Friend the Member for Edinburgh, West (Lord James Douglas-Hamilton) asked a Question on 16th February, from which there seems to be an increase of 3,092 in the Scottish Office over the previous year. This seems to be very much at variance with the earlier replies.
However, the more important one, which I am sure the hon. Gentleman will confirm, is in relation to 2nd February in reply to my hon. Friend the Member for Edinburgh, South (Mr. Hutchison) that there was a staff of 18 officials to deal with the devolution unit in the Scottish Office. This again is a matter for clarification, and we would be grateful if the hon. Gentleman could give an indication of what the staff is and whether it is adequate for the most important job in hand. Can he say whether this includes the possible development of Waterloo Place? Can he also say what is happening in relation to the staff in the Constitution Unit concerning the probable Assembly site on the Royal High School?
We have been given the facts by the Secretary of State in relation to Vote 22 of the Supplementary Estimates to the Scottish Office. I think we are all slightly critical of these Estimates in general because they are so vague. It is very difficult to tie down exactly what the money is to be spent on. However, we realise that it is to be £386,000. Can the Minister again say what proportion of this £386,000 is to be applied in the present year to the work which, I accept, is valuable in relation to the Constitution Unit as applied to the Scottish Office? Obviously, the Scottish Office has a very substantial interest in what is going on in this Unit.
I know that you would be outraged, Mr. Speaker, if I were to deviate into the plusses and minuses of the Assembly but it would be relevant to ask whether the expenses of Officers of the House engaged in discussion of this matter with the Scottish Office and the Cabinet Office will be paid by the Government. They have played an important part in discussing the practicality of an Assembly, and there must have been some expenditure by their offices.

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Although I am concerned about Government expenditure overall, I accept that if these Estimates are to provide a background and policy for legislation in regard to Scotland over the next decade and into the next century they are justified. If the Minister will set out the reasons for the expenditure, I shall be satisfied.
11.16 p.m.
Mr. George Reid: Perhaps surprisingly, I have a sneaking regard for what has been said by other hon. Members. My reasons are best illustrated by an anecdote told in the New Statesman by the hon. Member for Berwick and East Lothian (Mr. Mackintosh), who is an academic. He discussed the Constitution Unit with a number of civil servants and academics in Whitehall, and one bright young man from Oxbridge said "I am off on a devolution caper". So I have some sympathy for what the hon. Member for Fife, Central (Mr. Hamilton) said. A week ago the hon. Member announced that he would have nothing to do with the "charade" of devolution, so I welcome his renewed interest in the subject.
I have five questions for the Minister. First, to what extent has the £386,000 been devoted to looking at Scotland's role as a possible European nation? Second, to what extent has the Constitution Unit considered the fact that, whereas joining the EEC probably represented the end of Empire for our English neighbours, for Scotland it marked a simultaneous rediscovery of a possible role as a small European nation?
Third, to what extent has the money invested by the Unit in research been devoted to devolving economic management north of the border, to determine whether the Keynesian grip on the economy of the United Kingdom could be loosened, doing away with aggregate demand management? Fourth, to what extent has the Unit costed the real business of Civil Service reform in Scotland and of a Civil Service devoted to the Assembly and to a Scottish Parliament?
Fifth, to what extent has the Unit considered Shetland? Has the money devoted to research covered the Law of the Sea Conference? Have those bright young men considered the ratio of land to population and sea area, and the question
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whether Monaco, although supposedly independent within the European Community, has a place at the Law of the Sea Conference, and whether San Marino has a seat at the top table? That would be helpful in terms of the East Shetland Basin.
Finally, I should like to devote myself to the whole question of the Scottish economy.
Mr. Speaker: Order. If the hon. Member did that, it would be enough to make me leave the Chair. He knows what he must do tonight. This is a very narrow debate. It should be limited to the increase in salaries and general expenses of staff engaged in the Constitution Unit.
Mr. Reid: I shall try to approach the matter in another way, Mr. Speaker.
I asked a certain noble Lord who is fairly close to the work of the Constitution Unit whether he would define separatism. After considerable thought, he said that as the Government ruled out separatism it was not a matter to be considered.
The Unit might spend a little time in the months ahead considering Scotland's GDP, central Government revenue from Scotland, the value of oil production and its value come 1980, and the value of oil revenues today and the value come 1980. Let it consider those matters in terms of its work and the work of the Chancellor of the Duchy of Lancaster.
Scotland has about 9·3 per cent. of the population of the United Kingdom, and the present value of the oil is about £800 million. Scotland's share of the United Kingdom GDP—this is worthy of consideration by the Whitehall men—is 9·5 per cent. or 96 per cent. The expenditure that is received by Scotland is about 9·85 per cent. Another factor worthy of consideration is that the revenue contribution from Scotland is about 10·1 per cent. to 10·2 per cent.
It is significant that the Treasury has refused to produce a Scottish Budget. It was willing to do so in the days when it was considered that Scotland was too poor for Whitehall to worry about. It is significant—
Mr. Speaker: Order. The hon. Gentleman is beginning to make general points again. I am sorry if I am being

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difficult, but I must observe the rules of order.
Mr. Reid: The Unit might like to consider producing a Scottish Budget in the months that lie ahead.
Most of us will be aware of what the hon. Member for Fife, Central has said. There is something of a constitutional polarisation within the United Kingdom. There is probably little chance of an Assembly being agreed upon outside Scotland. If there is a group of civil servants and Ministers at the centre of the United Kingdom Government considering the constitutional destiny of all the peoples of the United Kingdom, it is high time that it began to consider the polarised possibilities. At one extreme there is the continuation of the status quo; at the other extreme there is an independent Scotland within NATO and within the European Community.
11.23 p.m.
Mr. Ted Leadbitter: I have made clear my views about devolution. I have made it abundantly clear that I shall not be moved, motivated or influenced by any SNP Member who finds time to spread abroad the sort of propaganda that the SNP does not have the courage to state inside the House. That is my position.
Mr. Speaker: Order. It is a very interesting position but it has nothing to do with increases in salary and general expenses.
Mr. Leadbitter: I had made up my mind, Mr. Speaker, to work in full accord with your ruling, having responded to it in a gentlemanly manner.
When I consider the Supplementary Estimates and the Bill before us, I immediately get the impression that the situation is confusing for a Member who wants to seek to pursue the particulars arising from the terms of reference of the debate. The Bill embraces the generality of the Supplementary Estimates, but the debate is confined to increases of salaries in the Cabinet Office and the Scottish Office. Having found some difficulty in relating the two in the kind of debate we are having, I also have to consider how best to address myself to the justification for these salary increases in the Scottish and Cabinet Offices.
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My opposition on some questions of devolution is known, but I have a wholehearted desire to be in full accord with your ruling, Mr. Speaker. I understand that the wider debate which might have been expected to follow the subject of this debate as set out on the Order Paper has been limited by you, Mr. Speaker, to the salaries of certain officers.
I have taken some time to say how willing I am to accede to this change of direction. I am sure that those who arranged tonight's business did so in the best interests of the House. However, we must ask what is to happen to the officers who may be involved in extra work because of these salary increases. What are they doing? What are their terms of reference? If they have to work within rules as strict as those in this House, and if they have the same difficulty as I have in keeping within those rules, it will take a long time to set up an Assembly.
Mr. Douglas Henderson: I am following the hon. Member's argument very closely as it progresses within the properly strict lines laid down by you, Mr. Speaker. Would the hon. Member like to consider whether the increase in expenditure is due to continuing shifts in Government policy and Conservative Party policy and perhaps partly due to the time involved in having to study innumerable reports from various sections of the Conservative Party which to most rational people are very confusing?
Mr. Leadbitter: I am not a forceful hon. Member, but I noticed that the hon. Member for Clackmannan and East Stirlingshire (Mr. Reid) had left when that intervention was made by an hon. Member we have not seen in the Chamber for a long time. Questions about shifting would be better directed towards the oscillations of Members of the SNP. However, a good question requires another good question, even if there is a reluctance to provide an answer to the first question.
What does the hon. Member for Aberdeenshire, East (Mr. Henderson) mean by separatism? If I may hastily come to your aid, Mr. Speaker, the officers who are to benefit from these salary increases are working on this

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matter and will want to feel the temperature of the House on questions such as the one I have just asked.
I suspect you are about to say that this is out of order, Mr. Speaker, but I want to help the officers for whom we are about to provide money by a vote of this House, albeit "on the nod", so that they can understand whether they will be pursuing an argument about an Assembly, devolution or separatism.
Mr. Speaker: Order. They will have to be helped by the debate on the White Paper when the general principle was decided. Tonight the hon. Member can help them by discussing these increases in salaries and general expenses of staff.
Mr. Leadbitter: Yes, Mr. Speaker, and I agree that that is the nub of the matter. The very silence of hon. Members opposite strikes its own note. I need not pursue the matter further, because cross-examination does not necessarily produce answers. Silence is often the better answer to have, and I leave it there.
The hon. Member for Clackmannan and East Stirlingshire posed five questions but managed to remain in order. I seek to pursue only one of the questions he raised. He asked, quite justifiably, about the £386,000 to be allocated in the Supplementary Estimates to the Scottish Office. He asked how much of this would be devoted to Scotland in terms of nationhood under a Common Market arrangement.
This is a narrow debate and it is extremely hard to keep in order. I am doing my best. I am discussing the question of increasing the salaries of the honourable men in our Civil Service— worthy men, as I called them in Committee. They are the best civil servants in the world, particularly to those who travel abroad and see some of the tripe in the civil service there, advising other Governments. The hon. Member for Aberdeen, South (Mr. Sproat) knows my views on this, and it is interesting that in a great democracy we can find an affinity of relations on things that matter—
Mr. Speaker: Order. I hope I can find an affinity with the hon. Member. What happened in the Standing Committee must have been interesting, but perhaps the hon. Gentleman will return
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now to the question of the increase in salaries and general expenses.
Mr. Leadbitter: I am drawing on my last resource, as it were, and I am tempted to impose upon your generosity, Mr. Speaker, a little more by talking about Wales. But I shall desist.
We are dealing with an important matter which is taken very seriously by the House. The hon. Member for Aberdeen, South has emphasised this, as have other hon. Members, in particular my hon. Friend the Member for Fife, Central (Mr. Hamilton). The House must make no mistakes about this. We may be voting tonight for moneys for the Constitution Unit for the Cabinet Office or for the Scottish Office but there can be no foregone conclusion, whether this Government or any other Government are concerned. There must be no illusion that Parliament is so weak that a Government will be allowed to slip through questions of devolution, even when we give them moneys to examine the matter.
I make this abundantly clear. This country is entitled to know, Scotland is entitled to know and Wales is entitled to know that many of us in the House are willing to vote moneys for the Constitution Unit to examine without prejudice a matter of vital importance to this nation. But at the end of the day—I close on this note—what is important—
Mr. Reid: Will the hon. Gentleman concede that a small amount of the £386,000 being voted might go to examining the curious paradox of a Government committed to a Scottish Assembly and an official Opposition committed to an English and Scottish Assembly Doth reneging on their commitments? Would that not be a useful subject for study?
Mr. Leadbitter: No, that would not be in order.
Mr. Speaker: Do not be tempted.
Mr. Leadbitter: Mr. Speaker knows me very well. I would not slip into being out of order.
I close on a matter which is of great importance to the House. We are dealing with the Supplementary Estimates for the Cabinet Office and the Scottish Office. I believe that no Government will make an error of judgment on this matter because there is sufficient influence in the House

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to preserve the unity of the United Kingdom.
11.36 p.m.
Miss Harvie Anderson: I apologise to you, Mr. Speaker, and the House for not being present throughout this short debate. Unfortunately, one cannot be in two places at once. I hope that the House will appreciate that some of us have been attending a Standing Committee which rose about five minutes ago.
We are considering the additional expenditure of the Constitution Unit in both the Cabinet Office and the Scottish Office, occasioned by the proposals which the Government have put forward for having a directly-elected Scottish Assembly. I suggest that this expenditure could be greatly reduced by having fewer people working on this very bad idea.
It is felt in the House and in Scotland that this is one additional tier of government which is being planned within this institution which has been costed to date by the persons whose salaries we are discussing tonight and who will become increasingly costly and will create an equally costly and proportionately costly additional tier of government. This extra expenditure will fall upon the backs of the taxpayers, and if it is allowed to continue so, also in due course will the cost of an extra tier of government.
This is a very narrow debate, but the point I wish to make is one which is never faced up to by those who suggest that one more tier of government is a good thing. We have a responsibility to know something of the precise way in which money is being spent. I have some sympathy for those who would seek, as I would wish to do, to ask certain questions which are difficult to formulate within the narrow confines of tonight's debate. Therefore, I do not propose to detain the House for long. I wish to re-emphasise that only a relatively small part of Government expenditure is under discussion tonight, but it is part of something that will involve a great deal more than has been suggested in money terms.
For that reason, I am critical of the expenditure which we have before us, and it is right that at this relatively late hour so many of us with a particular interest in preserving the United Kingdom and in avoiding for Scotland the
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expenditure which is before us should express our views with force. We know that in doing so we are speaking for literally hundreds of thousands of people who will consider what we say tonight with great care and will give us increasing support.
11.40 p.m.
Mr. Ian Gow: I hope that it is in order for a Scotsman who represents an English constituency to speak in this debate. I am concerned at the way in which we are invited, late at night, to approve even these Supplementary Estimates under Class XIII, Votes 21 and 22. The two Votes total £788,000. Compared with the Government's total over-spending in the current financial year of about £12,000 million, although a final sum has not yet been disclosed, £788,000 may be regarded as a trifle.
I respectfully dissent from that view. For my constituents, for the taxpayers, for the ratepayers and even for those who do not pay taxes and rates that is an enormous sum of money. It is one of the sad signs of our time that we should be discussing this expenditure in an almost empty House.
I have tabled a Question to the Lord President about the composition of the Constitution Unit, which is apparently discussing how to increase devolution in Wales and Scotland. We are told that the cost will be £279,000 in the current year. We are entitled to ask what benefit Scotland and Wales in particular, and the United Kingdom generally, will derive from it. We rarely have a chance like this to challenge the Executive.
I was told in a Written Answer on 1st March that the civil servants who work in the Unit are as follows: one second permanent secretary, three under-secretaries, five assistant secretaries and one assistant solicitor—and here I declare my interest as a solicitor. If I lost my present appointment, perhaps I could qualify as a recruit to the Unit, no doubt at a salary considerably higher than I now receive. No doubt my salary then would be inflation-proofed, and no doubt I should be on a pension scheme which would be protected against the ravages of inflation perpetrated during the short time in which the Labour Party will be in power.
Mr. Robert Cooke: What about the wealth tax?
Mr. Gow: My hon. Friend mentions the wealth tax. Happily I am well below that limit. The list also includes one senior legal assistant and four principals. I wonder what is the definition of "principal" in the Constitution Unit. What function do the principals perform in relation to the future of what my hon. Friend the Member for Aberdeen, South (Mr. Sproat) still likes to call the United Kingdom?
Mr. Sproat: We have all followed with great admiration the work that my hon. Friend has done in quizzing various Ministers of the Crown about the assistants they employ. Can he say whether that list acknowledges the assistant to the Lord President and whether the salary-paid to the assistant to the Lord President is included in the £279,000? If it is, would it not be suitable for the Minister to tell us tonight, as we are presumably voting on a sum which includes that salary?
Mr. Gow: I am, as always, grateful to my hon. Friend, who shares my view about the devolution proposals. However, the Lord President of the Council has only one special adviser.
Mr. Nicholas Winterton: Who is it?
Mr. Gow: By current standards that is a great virtue, because the Prime Minister has seven special advisers. I do not wish to prevent, in the words of the prayer that we have at the beginning of our proceedings, the Adjournment debate on Tuesday next when I shall seek to raise the question of special advisers, including the subject of the special adviser to the Lord President. Therefore, I hope that my hon. Friend the Member for Aberdeen, South will be kind enough to wait until next Tuesday.
I had dealt with the four principals in the Constitution Unit. We have had one second permanent secretary, three under-secretaries, five assistant secretaries, one assistant solicitor—and I have laid claim to that office if I should lose my present position—one senior legal assistant and four principals.
Then we come to the keynote that there are 19 supporting staff. Here we may indeed wonder what is meant by "supporting staff". What do they do? What
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are they engaged in? What plots are they hatching for the well-being of the United Kingdom? Whom are they supporting? Is it the Secretary of State for Scotland? Is it the Lord President of the Council? It is certainly not my hon. Friend the Member for Aberdeen, South. He stands here on his own account—not for him 19 supporting staff, not for me and not even for my hon. Friend the Member for Dumfries (Mr. Monro), who until recently spoke from the Front Bench.
Mr. David Walder: May I suggest that the supporters are there to support the principals, and that a collective noun to describe the principals could be a "lack" of principals?
Mr. Gow: The total number in the Constitution Unit is 34, yet the supporting staff number 19. Therefore, more than half of the total members of the Unit are supporting the Unit. In military terms, we are used to having more people cooking the food than fighting with the guns. My hon. Friend the Member for Dumfries, knows full well about these grave matters.
The House ought to express its concern that there are 19 members of the supporting staff and a total of 34 in the whole of the Constitution Unit. These matters ought not to be allowed to pass lightly because we are now moving on towards midnight. Happily, on this occasion we are able to go on talking until dawn breaks, as I understand it. It is true that on Sunday we have to put the clocks on by one hour, but we have a few more hours to go before that occurs.
I turn from the Constitution Unit to the very important matters set forth in Class XIII, Votes 21 and 22. What do we find here? We find that reference is made to the Chancellor of the Duchy of Lancaster. We on the Opposition side of the House regard him as being one of the best Ministers in the present Administration.
Mr. Robert Cooke: Hear, Hear.
Mr. Gow: That is not saying a great deal. But at least we can say this about the Chancellor of the Duchy of Lancaster. He is not, so far, a candidate in the election for the leadership of the

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Labour Party. We have not had from the Chancellor of the Duchy of Lancaster a manifesto dissenting from the policies of the Government.
I have a particular affection for the Chancellor of the Duchy—
Mr. Speaker: Order. The House will be pleased to hear that, but the hon. Gentleman must realise that he is not here to discuss the salary of the Chancellor of the Duchy of Lancaster, because that was decided in the original Estimate, and the House is not being asked to vote more money for the Chancellor of the Duchy tonight.
Mr. Gow: I naturally defer to your ruling, Mr. Speaker. However, if I read correctly Class XIII, Vote 21, on page 413,
"Supplementary Estimate of the amount required in the year ending 31 March 1976 for the expenditure of the Cabinet Office, including the salary of the Chancellor of the Duchy of Lancaster"—
Mr. Speaker: I should like to help the hon. Gentleman because I am reading the same order. The Subhead detail indicates a reduction in the case of the Chancellor of the Duchy of Lancaster—a saving—and, therefore, the House is not being asked to vote any extra money for him tonight.
Mr. Gow: The point I was about to make, Mr. Speaker, was that my affection for the Chancellor of the Duchy—
Mr. James Lamond: As long as the hon. Gentleman does not take his insurance card.
Mr. Gow:—is founded on precisely the point that you have raised: that he of all Ministers is not asking for more but is accepting less. If it is in order to say so, I suppose that he can afford it more than the rest of us.
It is only right that I should turn now to page 415 and to the Scottish Office. Grave issues face the House, in particular the question of devolution. I find myself in profound but respectful disagreement with the Secretary of State for Scotland on the subject of devolution. The House is being invited to approve expenditure on a study and a research of proposals for an Assembly in Scot land—
Mr. Speaker: Order. Perhaps I may explain that the House has already decided the policy. It has had the discussion on original Estimates and on the White Paper. Only the reasons for the increase can be discussed tonight, and not the policy implied in the original Estimate.
Mr. Gow: I always stand corrected by you, Mr. Speaker. I therefore conclude by saying that any increase in expenditure designed to lead to a severance of the unity of the United Kingdom will be strongly opposed by the hon. Member for Eastbourne.
11.55 p.m.
Mr. Malcolm Rifkind: I think we should be grateful to my hon. Friend the Member for Eastbourne (Mr. Gow), who, with his usual clarity and originality of expression, has provided a slightly profound and unexpected contribution to this debate. It was unexpected in terms both of content and delivery.
I hope that this debate will be long remembered in the House. I very much regret that the Government Benches in particular are not as full as they might be. I note that the originator of the debate, the hon. Member for Fife, Central (Mr. Hamilton), has taken his leave for the time being. That is unfortunate, because this must be the only occasion on which he has rested much of his argument on the views of the CBI. In commenting on the expenses of the members of the Constitution Unit and whether account had been taken of the views of other organisations, I noticed that the hon. Gentleman did not go beyond the views of the CBI in support of his argument. It will be of interest to his constituents and to others elsewhere that that body should be considered to be of such weighty opinion by the hon. Gentleman.
As we have been reminded on many occasions, the confines of the debate are very narrow, it being concerned only with the increases in expenses and salaries of the members of the Unit. When we consider the Unit and the work it is doing, clearly there is no disagreement that that work of is of such profound importance to the future of the United Kingdom, whatever views we may hold

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on devolution, that the members of the Unit should be of high calibre and of sufficient numbers to enable the work to be done properly.
If a study is to be made and proposals are to be brought forward for devolution, it is vital that is should be done properly and comprehensively. Clearly, nothing would be worse than a shoddy performance because of lack of calibre of the individuals concerned or insufficient staff to do the job properly.
Having said that, I have certain questions to put to the Minister. First, when considering the salaries of the members of the Unit and the time span, is it the intention that the Unit will cease to exist when the Bill is published in October? Will it continue until the Bill is on the statute book? Indeed, will it become a permanent feature with the staff of the Unit responsible for considering extension of devolution to other parts of the United Kingdom?
Secondly, when considering proper salaries for the members of the Unit—this is important now—will account be taken of the fact that they will have to work under a control which is not very satisfactory? The Minister to whom they are primarily responsible, the Lord President of the Council, is only a part-time Minister on devolution. When considering whether the members of the Unit are able to carry out their work and whether they should receive salaries which enable them to do it properly, will account be taken of the fact that the responsible Minister is also Leader of the House and has to spend a great proportion of his time on other matters? Does the Minister accept that there may be a strong case now, with these profound and fundamental proposals about to be presented to the House in final form, for the Minister in charge of the staff of the Unit to devote his full time to these matters and not to be distracted by other, albeit equally important, matters relating to his other responsibilities?
To what extent is the work of the Unit, and all these persons whose salaries we are discussing, reflected in Government policy? To what extent were the White Paper proposals the recommendations of the staff of the Unit, who are being paid large sums of public
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money to bring forward such proposals? If it can be shown that the Unit is recommending proposals which are being accepted by the Government, their salaries may be justified. We have seen that the Government's policy is of a particularly fluid nature and that the contents of the White Paper are subject to major revision. Is the Minister satisfied that the staff of the Unit, whose salaries we are increasing as a result of our deliberations, are making a major contribution to the details of devolution policy? Or is it simply doing a bit of background research, with its proposals as often rejected by its political masters as they are accepted?
Mr. Nicholas Winterton: Is my hon. Friend suggesting that he believes that the Constitution Unit justifies 35 personnel? It seems from the questions he is posing that he believes that. It appears to me that a devolution package could be produced by far fewer personnel than 35. Is he prepared to comment?
Mr. Rifkind: The total number of persons most properly employed by the Unit can be determined only by studying what they do.
Mr. Nicholas Winterton: What do they do?
Mr. Rifkind: That is for the Minister to tell the House. My point is that I would not want us to scrimp on the numbers simply to save a relatively small amount of cash. If there are to be devolution proposals, which may become the law of the land and bring about the most fundamental changes in the United Kingdom, it is proper that there should be a comprehensive study of the proposals so that we can decide whether the proposals are justified and worthy of our support.
Mr. Leadbitter: Since this is a matter that involves both parties most pertinently, will the hon. Gentleman answer the question? Does he think that the number of people employed is justified?
Mr. Rifkind: I would be only too delighted to answer the question if I had access to what is being done. It is impossible for any hon. Member—including the hon. Member for Hartlepool (Mr. Leadbitter)—other than the Minister,

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who is aware of the day-to-day workings of the Unit, to say whether there should be five people or 105 people in the Unit. We need to see the terms of reference, the remit, the kind of work the Unit is expected to do and whether it is concerned with Scotland and Wales alone or with proposals for the English regions. We need to know to time scale to which the Unit is working and the consultations it is expected to have. Unless we have full details we cannot answer any questions. This is why we hope that the Minister will give us the information.
Mr. Leadbitter: There have been months, even years, spent on this subject. There has been the Kilbrandon Report. What is there that is new? Is the number of staff justified in the light of the information we already have?
Mr. Rifkind: The hon. Member knows that the Kilbrandon Commission never sought to produce legislation. It simply produced general proposals, the framework within which, if the Government of the day accepted the proposals, they would consider further detail and fill in the gaps. We must assume that the prime responsibility of the Unit is the preparation of legislation. We must wait to hear what the Minister has to say. Only he can tell us whether the number of staff is justified. I am not saying that the number is justified. It may be grossly more than the number required. But I cannot commit myself on that without knowing why the number has been determined as it has been and whether the present work load is justified and requires that number.
Mr. Nicholas Winterton: If the Minister's reply is not satisfactory—and my hon. Friend the Member for Eastbourne (Mr. Gow) has indicated that there is a great deal of money involved—what can this House do to deny the Government the money to carry out what is a useless exercise?
Mr. Rifkind: If the Minister fails to satisfy the House that the requirements of producing detailed, comprehensive proposals on devolution do not justify the number of persons employed in the Constitution Unit, the remedy for this House will be the same as the one applied to
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any other Government Department when the House is satisfied that there is an excessive number of persons employed.
Mr. Gow: Perhaps my hon. Friend will address himself to this crucial question. In the so-called Constitution Unit there are 34 members, 19 of whom are supportting 15. [Interruption.] I know that those figures are known to some hon. Members, but others may not be aware of them. Of those 34, 19 are supporting—
Mr. Speaker: Order. The hon. Member for Eastbourne (Mr. Gow) is becoming guilty of repetition—not tedious repetition, but repetition.
Mr. Gow: I apologise, Mr. Speaker. Will my hon. Friend address himself to that question and to the fact that the total estimated cost of the Unit in the current year is £279,000? Are the House and the country getting value for money?
Mr. Rifkind: My hon. Friend is right to stress that the criterion which must be, and will continue to be, applied is whether the country is getting value for money. As for the previous question asked by the hon. Member for Hartlepool, the only person able to answer it is the Minister, and the information must depend on the information that he is able to give us. If we are dissatisfied with that information, there are other means at our disposal of pressing him for the necessary information.
I make no apology for the belief that if there is to be a Unit it must be a unit with the resources to enable it to do this unprecedented task properly. It would be far better to scrap the Unit completely than to have the job only half done. There is no dispute about that between me and the Minister. But I share the concern of hon. Members on both sides of the House that we must be satisfied that the calibre of the individuals concerned is satisfactory, that there are not more individuals than are strictly required for the purpose for which they are employed, and that the work of the Unit is not merely a cosmetic exercise but a well-thought-out proposal to ensure that the proposals which ultimately come before the House are comprehensive, sensible, rational and in the public interest.
12.8 a.m.
The Under-Secretary of State for Scotland (Mr. Harry Ewing): This has been

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a fairly long and very interesting debate. At the outset, Mr. Speaker, I ought to point out that, because there has been more than one occupant of the Chair during the debate, the task of replying to it is somewhat difficult since your predecessor in the Chair took a rather different view—
Mr. Speaker: Order. The hon. Gentleman ought to know that occupants of the Chair always give the same rulings. That is what the House assumes. The hon. Gentleman will no doubt abide by the rulings which I have given.
Mr. Ewing: I was about to say that I would abide by the rulings which you had given, Mr. Speaker.
I am grateful to my hon. Friend the Member for Fife, Central (Mr. Hamilton) for initiating this debate. It is true that he and I had what could best be described as an altercation about devolution some weeks ago, and that it would be foolish not to recognise that he and I are on opposite sides of the fence in respect of our views on devolution.
Much has been said about the hon. Member for Perth and East Perthshire (Mr. Crawford), who has not been with us tonight. It will be difficult enough for me to deal with the points raised by hon. Members who have been in the Chamber without dealing with an hon. Member who has not been present. I shall therefore avoid any reference to him.
My hon. Friend the Member for Fife, Central referred to the cost of the Cabinet Office Constitution Unit. The cost mainly reflects inflation, and it would be wrong to attribute the total increase to an increase in the number of staff. There have been increases, and I was interested to hear the hon. Member for Eastbourne (Mr. Gow) say that 19 of the staff were supporting the other 15. There are now 55 people employed on the preparation of legislation. The matter has moved on since the time when the answer to which the hon. Member referred was given. We are now at an advanced stage in the preparation of legislation, as my right hon. Friend the Leader of the House said this afternoon. Therefore, in addition to the individuals mentioned by the hon. Member for Eastbourne, draftsmen, parliamentary counsel and other staff are
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employed on the preparation of legislation, as they are on any legislation, whether it be on devolution, the shipbuilding and aircraft industry or any other Bill.
Mr. Gow: Is the Minister telling the House that since 1st March the staff of the Constitution Unit has increased from 34 to 55? If that is so, by how much has the annual expenditure of £279,000 increased and to what extent does the Consolidated Fund Bill require amendment?
Mr. Ewing: I am not saying that the number employed by the Cabinet Office Constitution Unit has increased. I am giving the House an honest appraisal of the present situation. In addition to the 34 staff, there are now others employed on devolution work. Draftsmen and others are preparing the legislation. They are working for the Constitution Unit in the same way as they work for the Department of Trade or the Department of Industry when preparing legislation. There must be parliamentary draftsmen to prepare a Bill. The Constitution Unit is not drafting the Bill. The draftsmen are drafting it. There are other people now employed on devolution work, but that is only part of their work.
Mr. Sproat: Is the Minister saying that 21 extra people are engaged in drafting the Bill and that they are all parliamentary draftsmen? If they are not, will the Minister break down the figure? What is the cost to the taxpayer if it is not included in the £279,000?
Mr. Ewing: I am not saying that there are 21 parliamentary draftsmen employed in drafting the Bill. I am saying that at this stage draftsmen, counsel and those who have to be consulted in the Departments involved in the devolved functions total about 55 people. That number will fluctuate as we go through the legislation. It would be wrong to say that the only people involved in devolution were those in the Cabinet Office Constitution Unit, and so give the impression that the 34 represented the total number employed on devolution. The additional figures I have given represent people partly employed on devolution and partly employed on other work.
Mr. Gow Mr. Gow rose—
Mr. Ewing: I think that I have explained the matter fairly fully. It is difficult to see what further information I could give the hon. Gentleman.
The hon. Gentleman spoke about the number of support staff being bigger than the number of what could loosely be described as experts. In view of the hon. Gentleman's profession, I am sure that that is not a new phenomenon to him. The number of support staff in the legal profession outnumbered the experts by a much higher proportion than the 19 to 14 that I think he quoted.
Mr. Leadbitter: What happens in the legal profession is no justification. The House cannot be expected to emulate bad practices. I have to give many people reasons for being unable to obtain financial support for essential services. With so much extra money in the Supplementary Estimates, the House is surprised to hear at this late hour that 21 extra people are involved. Will my hon. Friend undertake that we shall be given an explanatory note, so that we know what we are voting for and why?
Mr. Ewing: I thought I had explained that clearly, but obviously my hon. Friend did not find my explanation very clear. I said that the additional people were employed partly on devolution work, because the Bill had to be drafted, and partly on other work. No doubt they will be drafting other Bills to come before the House in the not-too-distant future on other aspects of Government policy.
It is easy to say how hard it is to tell our constituents that they cannot have essential services when our own pet hates are going ahead. We all have our pet hates. But I know that my hon. Friend is most generous in his understanding of these matters.
My hon. Friend the Member for Fife, Central seemed to believe that my noble Friend Lord Hunt was head of the Cabinet Office Constitution Unit. That is not so. My right hon. Friend the Lord President is its head. It is worthy of reflection that my noble Friend replaced a Commons Minister in the Unit, and as there is no parliamentary element in my noble Friend's salary the Government could claim that they have slightly reduced the cost of the Unit. Nevertheless, I must say to the hon. Member for Eastbourne that he arrived for the debate
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only half an hour ago. I certainly do not intend continually to give way to him, because I got the impression during his speech that he treated the whole matter rather flippantly. It is a very serious matter indeed in Scotland, and if the hon. Member for Eastbourne is going to treat this matter in the flippant manner in which he treated it during his speech I would suggest that he goes to Scotland, even in the company of his hon. Friend the Member for Aberdeen, South (Mr. Sproat), and assesses the political situation for himself.
Mr. Monro: When the former Minister of State, Privy Council Office, departed to the Department of Education and Science, he was replaced by Lord Hunt. I do not think the Minister can make the point that there was any reduction in salary at all.
Mr. Ewing: I did not say that there was a reduction in salary. I thought that the hon. Member, on moving to the Box, would have heard better, but he can read tomorrow what I said.
Turning to the possible involvement of additional expenditure for a study of a referendum, I think my hon. Friend would accept that the Government's policy is that we are not in favour of a referendum on this issue. Beyond that I do not want to go. It would be wrong if I were to wander into arguments on the question of economic viability or non-viability arising from North Sea oil. Although these points were raised, I am sure, Mr. Speaker, that you would not want me to wander into those by-ways. However, I want to say that the Cabinet Office Constitution Unit has certainly not considered the possibility of separation. None of the money that the House is voting tonight will be devoted to a study of separation, and this is for the obvious reason that the Government and the country, including the vast majority of the people of Scotland, are bitterly opposed to separation. If there were to be a waste of public money, I think that waste would be involved in a study of separation. Therefore, I want to make it absolutely clear that there is no question of the additional money being voted tonight being devoted to the question of separation, purely and simply because this has been rejected.
The question of devolution to the other parts of the United Kingdom is indeed

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part of the work of the Cabinet Office Constitution Unit, and it is true to say that some of the additional revenue voted tonight will obviously be devoted to the work of studying the question of devolution to regions in England. It is well known that the Government intend to publish a Green Paper in the not-too-distant future discussing the question of devolution to the English regions.
I was asked various questions about whether the Cabinet Office Constitution Unit and, therefore, the Government, through this additional money being voted tonight, would be considering the representations made by the Confederation of British Industry in Scotland. It is right and proper to say we have had representations from a wide variety of organisations. A common thread which runs through the documents, with the exception of that from the Scottish National Party, is a desire to preserve the unity of the United Kingdom.
An early study of the documents received shows a wide divergence of view about how far we should go towards devolution. The CBI is only one organisation. The Aberdeen Chamber of Commerce has sent representations opposed to devolution and the chamber of commerce in my constituency has expressed the strongest reservations. The Scottish Trades Union Congress and the Scottish Executive of the Labour Party are equally important bodies—
Mr. Robin F. Cook: More important.
Mr. Ewing: I agree with my hon. Friend. They believe, with minor qualifications, that the Government have got the matter about right. This explains the divergences of opinion we have received.
The hon. Member for Edinburgh, Pent-lands (Mr. Rifkind), who told me that he would be unable to stay for the end of the debate, asked whether we would get value for money from the £239,000. I consider it to be first-class value for money. The Unit is also employed on discussing devolution to the English regions and other constitutional matters.
The easiest way to save the money would be to get the devolution Bill through as soon as possible. Then we could consider the future of the Unit. If threats of filibustering are carried out,
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hon. Members will cost the taxpayers, even in Eastbourne, a large sum. Hon. Members will have to explain to their electors in Eastbourne, the Hartlepools and Aberdeen why they have kept the House up night after night, week after week, at tremendous expense, leading, this time next year, to an application for a further increase for the Unit. How they will explain that is beyond me. I hope that they will consider those matters before setting about the task they have set themselves.
Mr. Leadbitter: I am utterly appalled. I am not prepared to put up with this. Most of us, and certainly myself, have made a reasonable, careful and considered contribution only to hear my hon. Friend issue a threat. He must withdraw or we shall fight. I shall not put up with this nonsense, nor will my constituents. In a narrow debate such as this, my hon. Friend has no right to enter into a political diatribe. He is talking a lot of rubbish. Let him remember that I and other hon. Members have conceded to the rulings of the Chair.
Mr. Ewing: That must be like a laxative. I am sure that my hon. Friend will be much better now he has passed it.
Mr. Nicholas Winterton: Withdraw.
Mr. Ewing: The hon. Gentleman tells me to withdraw. I hope that everyone now present will read Hansard tomorrow.
Mr. Leadbitter: It will be read by my constituents.
Mr. Ewing: It will not be denied that many hon. Members have said—
Mr. Leadbitter: My hon. Friend is talking a lot of rubbish.
Mr. Ewing: Many Members have said that they will seriously delay legislation. If that is so, the consequences of seriously delaying it must be pointed out.
Mr. Nicholas Winterton: Does the hon. Gentleman agree that some of my hon. Friends have merely indicated that they will use the procedures of the House to oppose legislation which they do not believe is in the interests of the United Kingdom?
Mr. Ewing: I was only explaining how money could be saved by passing legislation through the House as quickly as possible.

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I have been asked whether the Constitution Unit has considered representations from Shetland and about Shetland's attitude to devolution. I hope to visit Shetland within the next three weeks. I shall discuss with the Shetland Island Council the whole question of devolution. Perhaps we shall then have a better understanding of the attitude of the Shetland Island Council. It would be dishonest if I did not say that to some extent I understand the attitude of remote areas such as Shetland. I also understand the attitude of less remote areas such as Aberdeen. I can understand the attitude that is taken, but I must say that I believe it to be wrong.
My hon. Friend the Member for Oldham, East (Mr. Lamond) asked that the Constitution Unit should consider the relative advantages which are being enjoyed in Scotland compared with the situation facing his constituents. All these policy aspects of devolution are considered. That is why my right hon. Friend the Paymaster-General brought out the point made by my hon. Friend in the four-day devolution debate. The material for his speech was provided by the Constitution Unit. There can be no doubt that the substance of my hon. Friend's point is valid.
Mr. Sproat: It is extremely interesting that the material used by the Paymaster-General was provided by the Constitution Unit. It was an extremely good speech. Does that mean that if we want more information about the Scottish balance of trade deficit or indentifiable public expenditure in Scotland which amounts to more than the sum that Scotland puts into the Treasury, for example, it will be possible for us to table Questions to the Lord President to obtain such information?
Mr. Ewing: Much of the economic material in that speech came from my right hon. Friend's own Department. All the devolution material—the need to preserve the unity of the United Kingdom and the damage that would be done by separation—came from the Cabinet Office Unit.
The hon. Member for Dumfries (Mr. Monro) spoke about the need to get the policy right, and I was grateful for his
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indication of general support on devolution, though we may disagree on details, and on the work being done by the Unit.
The Royal High School has been mentioned, but it is not part of the Vote we are discussing and the Constitution Unit is not dealing with it. The matter is now in the hands of the Property Services Agency.
The hon. Member for Clackmannan and East Stirlingshire (Mr. Reid) asked to what extent the £386,000 additional revenue being voted to the Scottish Office was being used to examine the relationship between Scotland and the EEC. There seems to be a misunderstanding here. This amount is obviously for the Scottish Office. I am sure no one can think that it is only for the devolution unit. The relationship between Scottish Office Ministers and the EEC is a continuing subject for examination but is not part of the work of the Unit.
The question of devolved economic management is being considered extensively by the Constitution Unit, which has come to the same conclusion as that reached by the hon. Member for Perth and East Perthshire in his document last May—that the United Kingdom economy is so integrated that it cannot be broken up.
The hon. Member for Clackmannan and East Stirlingshire referred to the Law of the Sea Conference, which does not form part of the work of the Unit, but he also mentioned the Scottish Budget and I think that my right hon. Friend the Paymaster-General, in his speech in the devolution debate and in another speech in the constituency of my hon. Friend the Member for West Lothian (Mr. Dalyell) at the weekend, has given details of a substantial part of the Scottish Budget.
It is easy to talk about Scotland receiving 9·5 per cent. from the United Kingdom Treasury and contributing, on the hon. Member for Clackmannan and East Stirlingshire's reckoning, 10·2 per cent., but these figures cannot be justified by the economic facts revealed up to last weekend.
I am sorry that my hon. Friend the Member for Hartlepool (Mr. Leadbitter)

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has left the Chamber. I had the impression, rightly or wrongly, that I had somewhat offended his feelings. Therefore, it would be wrong in his absence to deal with the points that he raised.
The right hon. Lady the Member for Renfrewshire, East (Miss Harvie Anderson) suggested that the expenditure we are discussing tonight could be greatly reduced, or abolished altogether, by abolishing the Unit. I think the right hon. Lady would accept that this is not part of the Government's thinking. The Government are committed to an elected legislative Assembly in Scotland and to an elected Assembly in Wales. We are committed also to looking at the question of devolution in the English regions. It is not part of the Government's thinking to abolish the Cabinet Office Constitutional Unit. I am sure that the right hon. Lady would be astonished, although no doubt delighted, if I were to say that I accepted what she said. I could not accept what she said.
I understood the right hon. Lady to say that the Cabinet Office Constitution Unit was engaged in work that would increase expenditure through creating another tier of government. We are not creating another tier of government, certainly not in relation to Scotland. The proposals from the Cabinet Office Constitution Unit, as contained in the White Paper of November 1975, make it crystal clear that Scottish functions now decided here at Westminster will in future be decided in the Assembly in Edinburgh. Far from creating a further tier of government, we are replacing an existing tier by a tier in Edinburgh. There is no question of duplication.
Miss Harvie Anderson: I do not want to go into a matter of opinion, but on the Minister's argument he would have to agree, when he reflects on it tomorrow, that in that case we should be debating on the Vote before us a reduction of expenditure, because it would mean a transfer of moneys from the Unit which would have been doing the constitutional work. We are discussing an increase, and my point is that it is only the beginning of what will be a very big increase indeed.
Mr. Ewing: I take the point made by the right hon. Lady, and I have not changed my mind after hearing her intervention.
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The expenditure is going on at the moment in relation to the policies being followed in Scotland. The administration of the expenditure is being transferred to Edinburgh—it is as simple as that—and will not be legislated for in this House. Therefore in no sense can it be said that we are creating another tier of government. We are replacing one with the other.
I have dealt with the points made by the hon. Member for Eastbourne. I felt sorry for him in regard to the sacrifices he made to come to the House and when he said how much better paid he would have been if only he had been a member of the staff whose salaries we are discussing tonight. I cannot say that I look forward to the day when the hon. Member might be a member of that staff.
The hon. Member for Pentlands mentioned the matter of a Minister devoting all his time to the question of devolution. That is the position at the moment in the case of my noble Friend Lord Crowther-Hunt, who is Minister of State, Privy Council Office. He devotes his full time to the question of devolution.
It has been a very wide-ranging and interesting debate which has nevertheless kept within the rules of order. I am grateful for the opportunity that the House has given the Government tonight to air the subject and to justify the additional expenditure that we are asking the House to vote on this occasion.

ARTS AND NATIONAL HERITAGE
12.45 a.m.
Mr. Robert Cooke: If devolution means no more debates like the one to which we have just listened, no Scottish Grand Committee, no Scottish Standing Committees, no Scottish Questions, no Secretary of State for Scotland, no Scottish Ministers and far fewer Scottish Members of Parliament, I am for it, but I know that that will not happen and, therefore, I am against it.
Having cleared the air on devolution, I turn to the vital matter which we have been waiting for all evening—the further provision for the arts and the national heritage. That is the title of the subject, because there is further provision in the Estimates and that is the way we have

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to put it. I am not asking for any more money this evening. I want to ensure that we are spending the money we have in the best possible way and to discover whether there may be better ways of spending it.
I am absolutely delighted to see the hon. Member for Edmonton (Mr. Graham) sitting behind the Minister. The hon. Gentleman is the chairman of the all-party Heritage Group—an important post for which some of us supported him a year ago. I understand that he has been re-elected unopposed to it again this year. His contribution to the work of the arts and the heritage in particular, and to the spreading of the gospel among his colleagues and my colleagues, is much appreciated. I hope that we can continue to work together.
The heritage of our historic architecture and our landscape is on the whole well served by the Department of the Environment and its agencies, within their limitations, although the threat from inflation and taxation imposed and proposed is serious and merits most urgent attention. I have no doubt that the Chancellor is now considering all these matters, and we await his Budget speech and the Finance Bill with the greatest interest. I shall leave that matter there. I have given the Minister notice that I do not wish to pursue that matter this evening and he will not have briefed himself about it. Moreover, this is not the place to discuss it further. We await with interest the Chancellor's reaction to all the many comments that have been made to him and all the hard work that has been done by both sides of the House over the past year.
In passing, I should like to refer to the most helpful remarks made by the Chancellor of the Duchy of Lancaster in another debate on a similar subject.
We are concerned with Supplementary Votes for the Arts Council. We are extremely concerned that we should get full value for money, and that is why hon. Members raise such matters in the Consolidated Fund debate in the middle of the night.
The Arts Council is concerned in a wide variety of activities. It has expanded the scope of its activities, especially into the provinces, through regional art asso-
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ciations and in other ways. It has managed to do this despite the difficulty that it has not always known exactly how much money it will have, and it has been kept waiting a long time to know its fate for the ensuing year. The Minister has his difficulties in this respect, but he will not mind my again mentioning—I am sure that the hon. Member for Edmonton will join me in this respect—that we could get better value for money if the Arts Council knew in advance where it stood. It has asked for a three-year forward programme. That would be enormously helpful and much more constructive than living from hand to mouth and perhaps cutting out things which would nevertheless be carried on if the money were available.
I am sure that, like us, it is the Minister's aim to ensure that the maximum number of people are involved in all the artistic activities which the State provides, concerns itself with or generally encourages. There is a number of very big spenders. It is a great shame that I cannot go into the pleasures of Welsh National Opera for Mr. Speaker's benefit this evening, but, alas, it is out of order. The Royal Opera at Covent Garden is one of the biggest spenders of all. It is a magnificent international leader.
However, I believe that time and public patience are running out for the Royal Opera because of its lack of public access. More people could see the Royal Opera on televisison in one evening than could get into the Royal Opera House between now and the end of the century. That also applies to the National Theatre. The Minister knows why we do not see the Royal Opera on television as much as we should. The television companies now find it cheaper to buy opera ready-made from abroad than to pay the sort of fees demanded by Covent Garden. The hon. Gentleman and his agents are working hard to persuade the unions who hesitate to be more forthcoming that it lies in their interest to embrace television as a friend and not regard it as an enemy. The unions are afraid that it will lead to a loss of jobs.
If the millions who pay taxes to support this great institution suddenly woke up to the fact that they are not getting full value for money—it is magnificent value for money if they go to see it, but they do not—they might say that enough is
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enough. They might insist on perhaps half the money being spread around in other directions where it will do them more good. I know that the Minister is working hard on this problem, but I hope that we shall see results soon because we shall wish to return to the subject if we do not.
It is unfair to make an early judgment on the National Theatre. That is a building which must have been purpose-built for television participation. We hope that we shall see more from it and of the new adventures taking place inside it in the Cottesloe Theatre which is designed to be experimental.
The reason why I have stressed television and the way in which it enables the millions to participate is that it can bridge the gulf between what people call the "high arts"—the Royal Opera and special productions—and the less-well-established activities, the fringe activities. The experimental activities of the National Theatre can help in this direction. We do not want a growing gulf between the two. We want them brought closer together. Television provides one solution to that problem.
The Minister will not be surprised that once more I advocate bringing the fourth television channel into use as soon as possible. We might quarrel about whether it should be given to the IBA, but I think most people would accept that the only practical way to get more money into the arts is to give it to the IBA and the independent television companies so that they can provide a service equivalent to BBC2.
The Minister is an undoubted enthusiast for the theatre. I remember his contribution in Standing Committee on a Bill which marginally helped theatre buildings. The counterpart to that Bill will shortly be going into Standing Committee. I shall be leading for the Opposition on it, assisting my hon. Friend whose Bill it is. No doubt the hon. Member for Edmonton will be there. It is concerned largely with theatre buildings and with keeping them going as living theatres. In view of his enthusiasm for the theatre, the Minister should take a fresh look at some of the practical problems and at the way in which the commercial theatre can teach the subsidised theatre about such things as efficient manning levels.
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I do not believe everything I am told by the commercial theatre about the number of people behind the stage and the number of actors compared with the numbers in the subsidised theatre. Many of the productions that go on in State or local government-subsidised theatres are ambitious and labour-intensive. The Royal Opera should not be produced on the cheap unless a real economy was involved. If one mounts a great operatic production which one wants to send out on tour and last for years, one does not make it of flimsy stuff. I believe that the Minister is in touch with both sides. I hope that he will comment on this aspect.
VAT is not included in these Estimates. It would be impossible to bring VAT into a Supplementary Estimate. I leave the Minister with the thought that there is an extra amount in the Arts Council grant to take account of the VAT costs of the subsidised theatre. That puts theatres in the private sector at a disadvantage. I hope that the Minister will address himself to that. I do not ask for differential rates. I should like to see a low flat rate of VAT right across the board. We started with 10 per cent. and now have a messy situation. Luxury goods have a VAT of 25 per cent. in this country. Lawnmowers are included in that category. In France, pornography bears the 25 per cent. rate. The whole situation is a nonsense, and I hope that the Minister will use his influence to ensure a lower uniform rate.
I turn to museum policy. I hope that the Minister will ensure that the work of both national and local museums—State, local authority and private enterprise museums—is related to the life of the community. There are many private enterprise museums, one of the finest being the Dorset County Museum, which I am happy to support. Museums used to be quite isolated. A museum was somewhere one sent the children on a wet afternoon. The situation is different now because parties of schoolchildren visit and work in them. Last week the Dorset County Museum was full of schoolchildren.
The Minister is the one person in the Government who can lend influence to ensure that activities in all our museums are related to real life outside. I was

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delighted that the Secretary of State for Education and Science came to the conference of the Historic Houses Association which was held at the Royal Festival Hall. Next year is Heritage Education Year. It is most encouraging that the Department of Education and Science is taking an interest in the new roles which museums and historic houses play in society.
We must not forget the value to the community of this part of our heritage as a tourist attraction. I can actually relate that to a Vote. Some people believe that museums, historic buildings and heritage are of less importance, but their importance to our tourist industry is incalculable.
I turn to the subject of museum acquisition policy. I have crossed swords with the Minister about this. I know that he is as keen as anyone to see that we do not lose from this country major objects that are offered on the market and which might very well go abroad if people in this country—I use the word "people" advisedly—are not prepared to come forward and rescue them so that they can remain here.
I want to repeat what I have said to the Minister previously about this matter. It is appreciated that much good work is possible within the Votes in the Estimates and the provision for museum acquisitions. However, sometimes public appeals have to be launched. I put it to the Minister again that it is not very helpful for a Minister to say "I shall not respond to the invitation of a national institution to help in the public appeal" and then to mumble something like "In any case, it might be allowed to mortgage the future and to draw on future grant allocation in order to buy the object." That will have a bad effect on the public appeal, because the public will say "The Minister will have to do it eventually. With rather poor grace, he will let the future be mortgaged."
The Minister should make up his mind first whether, the object must be kept in this country at all costs. He need not announce that publicly, but he should make up his mind, with the help of advisers, and decide how to play it and how to keep the object here with the least amount of public money. There may
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be occasions when the sum is so large that if the Government said that they would contribute pound for pound from the public purse the public would come forward with private money and do the rest.
We have learned from a newspaper that one great manuscript, the Malory "Le Morte D'Arthur" manuscript, might come on to the market. I hope that the Minister has some thoughts about that.
The real solution is to remove the causes of the dispersal of historic things from this country. That is a matter for the Chancellor of the Exchequer, but I hope that the Minister now recognises that there are economic forces afoot which would cause us grave difficulty.
Item Class VIII, Vote 2, relates to expenditure which can certainly be related to the celebration of Her Majesty's Jubilee next year. Already, somewhat surprisingly, one learns that the Home Office is the co-ordinating Department in this matter. I cannot expect you to rise up from the Chair, Mr. Speaker, and enlighten us as to what part Parliament will play under the wing of the Home Office, but I know that what happens here is very much under your wing, and I hope that the House will be informed in good time.
However, on any great State occasion such as this will be, although Her Majesty has quite rightly said that she would not wish any excessive expenditure to take place—nor would I in present circumstances—one looks to some member of the Government to act, if it is not too crude a phrase, as a matter of ceremonies.
We have had State occasions before. The Earl Marshal has his function at the Coronation. The Minister of Works, the First Commissioner of Works, has always had a great deal to do with these things. Lord Eccles was Minister of Works when the Coronation took place, and he went on to become Minister for the Arts. That may be some added weight to my argument that the Minister should consider how the arts can play their part in connection with the Jubilee. Are the Government thinking of commissioning or encouraging to be commissioned works in connection with the Jubilee, musical compositions or works of literature, painting and sculpture? Will they offer prizes? Has the Minister

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thought about such matters? I should like the Minister to comment briefly on this matter tonight.
There are quite a lot of small things that can be done within existing programmes but in a special way so as to have a particular relation to the Jubilee celebrations. Indeed, the whole theme of what I have been saying is not to ask for more money but for the better use of the public money that is being used. It may even be less public money.
There is an Estimate relating to historic buildings which allows me to mention Somerset House. I do not propose to enter the burning controversy over how many of Turner's paintings will find their way to Somerset House. Another Minister has already grasped that nettle and held one meeting which seems to have aroused further interest. I expect that the Minister with responsibility for the arts has thought about the matter. I want to leave him with the thought that, if a fine gallery were to be established at Somerset House filled with works of art of all kinds, some extra rooms perhaps filled with more modern works than has been suggested, that might be a good place for him to take up residence.
Belgrave Square was an emergency job to get the Minister for the Arts out of the Department of Education and Science. That was quite right. However, it was only temporary. The Minister might consider taking up residence in a small room at the end of the State rooms in Somerset House. He could then walk through those splendid rooms to meet the public who will be enjoying the works of art which he has provided for them.
What is the Minister doing to get involved in international affairs? This great book is loaded with money being spent on our work abroad. Indeed, there is nearly £100 million unallocated on one page. I dare say that it has been allocated on another page, but the Clerk of the Committee could not find where it had been allocated. I am sure that there is scope there for the Minister to find money—indeed, he might not take any money—with which to involve himself in international events.
There was something called International Music Day last October. I asked the Minister
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"what part Her Majesty's Government played in International Music Day on 1st October 1975."
The answer was:
"None."—[Official Report, 16th October 1975; Vol. 897, c. 798.]
That was rather disappointing.
Things look better for the future when we come to literature as opposed to music. The forty-first International Congress of PEN, the writers' organisation, is to be held here in August. I have no doubt that some of its members will visit the historic buildings mentioned in another of the Estimates. I hope that the delegates will be royally received here. It is a great event. It has not been to London for 20 years. The delegates I met in Athens were very much looking forward to coming here. I hope that the Minister will tell us how he proposes to participate in that event. It will not cost very much, but his interest will be greatly appreciated.
The Minister has already come round to the view that Supplementary Estimates on this scale would not be so necessary if he did more to encourage private and industrial patronage. It would be wrong to stray into that area in any detail. However, the Minister's conversion is appreciated. I hope that he will continue with the good work he has tentatively begun. I am informed that the Arts Council is keen to be of assistance in this matter. Perhaps we can come back to it on another occasion. We have already gone a long way in persuading the BBC about the respectability of sponsorship for arts programmes. No doubt ITV will follow.
You have been very patient with me, Mr. Speaker. I have not caused you to rise to your feet yet, and I do not think that I shall in what I want to say in conclusion. There is immense public interest in the subject on which I have tried to touch, albeit dodging from one thing to another because this large book is difficult to manoeuvre, and the Opposition are most interested in this whole area. So far the Opposition have created the opportunities for parliamentary debate and discussion. Much of the good work which is being done in this area is the result of pressure in this House. I do not claim it all on this side. We have provided the opportunities for debate, but

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both sides have pushed the Minister into doing some of the good things that he is now doing.
I hope that we shall have other opportunities in future to discuss this subject. There is limitless time in this debate—long into the small hours and on to the dawn—but I am sure we shall not keep the House that long. I am happy to have initiated the debate. I eagerly await contributions from the hon. Member for Edmonton and perhaps another of my hon. Friends. I await, equally eagely, the Minister's reply and hope for some stimulating new thougths from him.
1.11 a.m.
Mr. Ted Graham: I am pleased to have the opportunity of intervening in this debate brought about by the initiative of the hon. Member for Bristol, West (Mr. Cooke). The hon. Member was too modest in his concluding remarks when he sought to disclaim credit for the initiatives he has taken in this House in recent years in raising the subject of the arts and our heritage. The record clearly shows that he has played a major part in drawing to the attention of the House the problems facing the arts and our heritage.
I am delighted to be associated with the hon. Member in what I see as an essay in encouragement to the Minister. I was pleased to hear the hon. Member's generous tribute to the work of the all-party Heritage Group, which he played a major part in founding and which is a fine asset to the all-party proceedings in this House. This issue is not a party matter and no party can claim to be preeminent in wanting to develop and extend work in this sphere.
I am conscious of the parameters of this debate. I take careful note—looking at Class VIII, Vote 2 and Class X, Vote 27—that I am able to comment on historic buildings, grants to local authorities and the National Trust, its expenditure in acquiring historic buildings and their contents, the Arts Council, the National Theatre and assistance to local museums. All of these matters are subject to modest increases in the Votes.
In talking about our heritage, we refer to things that are both tangible and intangible. We can look at an object, a house, a book, a picture and say "This
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is part of our heritage." But there are many other things which are not so tangible. We look upon these things as part of our heritage, which we wish to maintain. We are debating modest increases from the public sector, but there is also the contribution made by the private sector. The remarks of the hon. Member for Bristol, West are apposite in that the arts and the care of our heritage will not flourish merely by support from one element or the other. It cannot be said that greater importance should attach to the private or the public sector.
It is proper to make a fleeting reference to the additional element in the support given to the arts. I support the modest figures involved tonight relating to historic houses. I had the good fortune about three months ago to present a petition to the House on behalf of more than a million people organised by the Historic Houses Association. The overwhelming majority of those people live in the United Kingdom. They expressed their anxieties about the future of our heritage of historic houses.
I am very pleased to see the Government's continuing interest manifested in the modest increases in the Vote for preserving these aspects of our heritage. The other week, the all-party Heritage Group visited two historic houses, Woburn and Rockingham Castle. At Rockingham Castle I was very impressed by the history of the place, which goes back to 1066. Not only is it an old building; it reeks with history. It can be described as one of the units of our heritage, because it is not just a historic house. It is in a historic setting, with a historic village. I hope that some of the money being made available will be used to keep in existence buildings of this kind, with the corollary always that the public have continuing and wider access to them. We believe that more money should be made available, but I hope that the House will recognise that, in return for financial assistance from the public purse, more and more rooms will be opened and more and more access will be given to the public.
I hope that, as a result of the Government's pronouncements on taxation matters and so on, the partnership on which we have embarked will ensure a more settled future for our heritage, especially in terms of our historic houses.

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The hon. Gentleman spoke about the useful activities of the Chancellor of the Duchy of Lancaster. In preparation for this debate, I made a point of reading the remarks of my right hon. Friend in the debate on 2nd February and I found that they buttressed the need for the modest increases in this Vote for the preservation of our historic houses. He said:
"The preservation of our historic districts and charming areas must not mean their preservation as antiques."
How right my right hon. Friend was, because these places will be supported only if they are seen by the people to be living entities. He went on to speak of the need
"to preserve them in their full cultural and architectural context within the structures of a changing society".
That is also true, as was my right hon. Friend's reference to
"our great historic houses, which are becoming centres of artistic activity and which themselves are objects of priceless and irreplaceable beauty."
It is very encouraging to hear a member of the Government who has a major interest and responsibility in these areas speaking in those terms, and we should be grateful. However, one of my right hon. Friend's remarks may not have been so welcome in many places. He said:
"The owners of our historic houses are more expendable than the buildings".—[Official Report, 2nd February 1976; Vol. 904, c. 1136–7.]
That is also true.
Mr. Robert Cooke: They may be more expendable, but the way they run their houses is less expensive than it would be if the State had to take over the buildings and run them.
Mr. Graham: There is no dispute between us about that. The people and the State receive infinitely more benefit from the present arrangements, give or take an adjustment one way or the other. I would blanch at the thought that the costs of management and the problems of maintaining many of these historic houses might have to be shifted on to the State, as opposed to the partnership arrangements that we have at present.
The hon. Gentleman spoke of the modest increases for the acquisition of contents, and he referred to the "Dona-
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tello" and the "Le Morte D'Arthur" manuscripts. For purchases of that kind, I believe that the best way is for the money to be contributed by individual members of the public. However, I appreciate that inflation is affecting the ability of a great many people to do this—individuals and organisations—and I think that as long as people share the treasures which are being bought out of the public purse there is a reasonable case for more money being made available, always provided that it is carefully husbanded.
I turn now to the part of the Vote relating to the modest increases for local museums. It is an important matter and I well understand the term "high art" which was used by the hon. Member for Bristol, West. It is important to recognise the value of local museums not merely as repositories of local pieces of history but as places which start young people on the long journey towards a deep and lasting interest in their community.
Edmonton, Enfield and Southgate each have fine local museums. None of them has any pretentions to be more than local museums, but each has been aided by its local council by a modest contribution from the rates. I am sure that from time to time they have had access to money from the Vote we are now discussing.
Forty Hall in Enfield, a fine historic building, was rescued 25 years ago by the local council. Ten years ago I was a member of that council and I played a modest role in ensuring that money from private sources, the local council and funds such as those in the Vote was devoted to turning what was a modest building in decline into a first-class piece of architecture which is visited by children in the district. Southgate and Edmonton also have fine museums which are a mixture of heritage and the arts.I am delighted at the increase in the Vote. More than £30 million has been contributed from public funds to the arts in the past 12 months. That sum is about 100 times more than was spent 30 years ago, and it reflects credit on the House and on Governments of all parties.
I am delighted that the first Minister with responsibility for the arts was Baroness Lee and that she was given the initial spur for her work by a Labour

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Government. The Minister who followed her is a credit to the post and the objectives set by the Government. The opening of the National Theatre brings to fruition the major efforts made to present and previous Governments. We are lucky to be able to pay tribute to the work of a Government Department in this way. I echo the remarks of the hon. Member for Bristol, West, who said that we not merely have a duty to sustain the arts here but that we must ensure that the people who come here from abroad understand what we are trying to do.
I hope that the Minister will take courage and sustenance from the modest interest which has been shown by a limited number of hon. Members from both sides of the House and which should be encouraged to grow. I hope that the Vote for so many worthwhile causes will be approved.
1.24 a.m.
The Under-Secretary of State for Education and Science (Mr. Hugh Jenkins): I am most grateful to the hon. Member for Bristol, West (Mr. Cooke) for raising this subject. It covers ground similar to that which we have trodden before, but it is no worse for that because matters move, and the debate gives me an opportunity to put on record the latest position. That will be of benefit not only to the hon. Gentleman but to other hon. Members who, although not present, take a considerable interest in the arts, and to the public.
As the hon. Gentleman acknowledged, the area covered by these topics is wide. He was tempted to go outside the narrow ground we are supposed to tread. I shall be tempted, too, but I have no doubt—
Mr. Deputy Speaker (Sir Myer Galpern): I do not mind the Minister going too far, as long as he does not go on for too long.
Mr. Jenkins: Thank you for your guidance, Mr. Deputy Speaker. I think that the debate will be briefer than some of the previous debates.
I am grateful for the help of my hon. Friend the Member for Edmonton (Mr. Graham), who was kind enough to act in a temporary, unofficial capacity for me tonight. I appreciate what he said, but
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to some extent he talked about an aspect of our national heritage which is beyond my purview. My right hon. Friend the Secretary of State for the Environment is responsible for the fabric of historic houses. I have a close interest in their contents. It was in order for my hon. Friend to raise the matter, but I hope he will forgive me if I do not pursue it very far tonight.
The hon. Member for Bristol, West raised a matter of great validity when he spoke of the Government's inability, at this time of rising expenses and the endeavour to contain inflation, to give the advance notice we should like to give to people in the arts of what their grants will be in the coming year. A triennial basis with full notice was once valid and useful, but in a time of inflation it becomes increasingly pointless to give advance notice when one hardly knows what the consequences will be in six months' time.
A certain amount of reassurance can sometimes be obtained from the public expenditure survey, though I agree that it is no substitute for the kind of guidance that we hope to resume as soon as possible. It will be necessary to bring inflation under more control before the triennial advance notice can be of the same value as it has been and as we hope to make it again.
An equally valid point concerns access by the public to the major national companies, such as the Royal Opera House, on television. There has been some progress, such as the fine performance of La Bohème, which I think was transmitted by Southern Television from the Royal Opera House Company. That is an example of what can be done, and I have every hope that it will continue to be done.
It is not only a question of union difficulties. It is a three-way operation. First, there is the producing management. Next there is the transmitting organisation, whether the BBC or a commercial television company. Then there is the interest of the trade unions concerned with the people at work. Therefore, it is a difficult operation, but La Bohème was a breakthrough, and the BBC has done similar work. I hope that such programmes will become regular features and that we can expect the national companies to be seen from time to time on

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both channels. I think, Mr. Deputy Speaker, that you will encourage me not to follow the hon. Gentleman any further in the television direction, and I think it would be inappropriate for me to do so.
I should, however, like to say something about the National Theatre because, as my hon. Friend has just pointed out, we are in the week of the beginning of the opening of this great building on the South Bank. Having regard to the fact that it is a modern building, and modern places on the whole do not get a very good critical response, I think that the critical response for the new building on the South Bank has been surprisingly good. I was there myself earlier this week and I believe that it is one which will grow in the hearts of our people and will become an extremely important addition to the artistic armoury of our country. It is a joint effort by the GLC, the South Bank, the National Theatre Board, the Arts Council and the Government.
When we passed the National Theatre Act in 1974 we provided the finance to enable the new theatre to open its doors to the public this week. It is a week which has seen the culmination of a motion I moved a dozen or more years ago in the old London County Council which led to the construction of this great building on the South Bank. I therefore take a modest pride in my own part in this historic project. There is some way to go yet, but everyone concerned can be proud of the progress made.
The hon. Member for Bristol, West made a passing reference to the relationship between the commercial and the supported theatre. I should like to say that I believe this relationship is becoming closer. I would draw his attention and that of the House to the fact that increasingly we are seeing commercial runs in the West End of productions which have started in supported theatres. Mr. Albery, for example, and the Wynd-hams Theatre have been giving West End runs to a number of productions which have begun—one in Nottingham and one in the National Theatre. This relationship is an example of how the mixed economy can work to the advantage of the commercial theatre and the supported theatre. I have every hope that this relationship will be productive, because what
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we are concerned about is the welfare of the arts and, in particular, the welfare of the consumer, who is the man to whose interest we must all bend ourselves.
As far as VAT is concerned, I hope I shall be forgiven—in fact, I shall be commended—if I make no reference to this other than to say that this is a matter for my right hon. Friend the Chancellor of the Exchequer. However, I take the point made by the hon. Gentleman. I have never concealed the fact that I am not a great lover of VAT as far as the theatre is concerned. I would interpret what the hon. Gentleman said not as a criticism of the Government's record but as a recognition of what we have been trying to do and as an encouragement for us to go on and do still better in future.
Mr. Robert Cooke: Before the Minister gets too self-satisfied, may I say that the rules of order caused me to concentrate on some of the constructive work which has been done. I shall look forward to pursuing some of the omissions of the Government on another occasion.
Mr. Jenkins: I have had some warning of the fact that the hon. Gentleman will be at us in a critical fashion at a later date. We shall not shrink when the time comes. We shall do our best to answer him.
The Government's achievement, even in the area covered by this Vote, is one in which we may take a modest pride. It is greater than is generally appreciated. The Government's record during the two years in which I have had responsibility in this area is one of which we are by no means ashamed, particularly having regard to the circumstances in which we have had to work.
Government grants to the Arts Council and other bodies like the British Film Institute now total well over £30 million. The Arts Council grant alone, is over £28 million, taking into account the supplementary additions, compared with £17 million in the Opposition's last year in office. As the Council distributes nearly all this money, it enables the arts to be sustained in difficult times. Other bodies concerned with the arts have benefited considerably. We have increased the grant to the Crafts Advisory Committee to more than £500,000 for the current year compared with £400,000 two years

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ago. The hon. Member for Bristol, West may be raising this matter on another occasion, so I shall not pursue it in detail now.
The impact that we make in the world of the arts outside this country is the concern of my right hon. Friend the Foreign and Commonwealth Secretary through the British Council. My concern it with what happens in this country. However, I hope to go to Oslo in June for an important meeting of the Council of European Ministers of Culture, as they are called in most other European countries. I prefer our term, Minister for the Arts. I hope to exchange views, to learn much and even to contribute a little. I also hope to host the Government reception for the PEN Conference at the Banqueting Hall at Lancaster House, the details of which are at the moment being discussed by officials.
Sir Anthony Meyer: I hope that the Minister will not be modest in pressing on the Foreign Secretary the enormous benefits which can accrue to this country from boasting of the fact that in many of the arts we are preeminent in a way in which, alas, we no longer are in many industrial spheres, and that money spent on projecting this achievement is well spent. I hope he will not be modest in pushing that point of view.
Mr. Jenkins: Indeed I shall not. What the hon. Gentleman says could be regarded as my theme song. In the two years that I have had this responsibility, it has been my view that this is an area in which we may take our place with pride in the world. Although our area of influence has shrunk in other ways, this is something in which we can say we stand with any nation.
We are taking a close interest in the "Le Morte D'Arthur" manuscript. If it comes on to the market it will certainly come before the Reviewing Committee. We are dealing with that especially. If export is delayed the usual processes will follow, which, if necessary, will involve public appeal. I cannot commit myself, except to say that we are seized of the matter and are watching it carefully.
We have increased the Government's share of the grant to the area museum
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councils, increasing it last year by 300 per cent. to £370,000. That is not such a huge sum because it was rather small originally, but it was a sharp increase. We are beginning to approach central Government support for the national collections. We are marching along a new path by taking on the role of trying to be helpful to museums other than the major national collections. We are proposing to increase the grant this year to over £½ million. The councils, together with matching finance from local authorities and others, are disposing this year of over £1 million. This is translated into practical advice and help to local museums of many kinds, especially the smaller ones. Again, at a time of financial difficulty we may have some modest pride in what we have been able to achieve.
The museums are devoting an increasing amount of money to the problems of conservation. The Midlands Area Museum Council, for example, is devoting one-third of its resources to conservation needs in the current year. I know that the hon. Member for Bristol, West takes a close interest in conservation. I shall leave one or two other matters that I had intended to raise because I think that they can be dealt with on another occasion.
I believe that the museums are beginning to recover from the consequences of what I think is now generally agreed as the ill-judged introduction of admission charges by the Conservative Government at the beginning of 1974. Attendances at the national collections were running at over 14 million in 1972 and 1973. They dipped by 1 million in 1974, which was the year of the charges, and climbed back again last year to 16 million. That is a very high number of people visiting our great museums. On recent visits I have been told that the number of visitors is rising rapidly and that the public's appreciation of and interest in the treasures in our museums continues to grow. The British Museum alone had over 3 million visitors last year. Several of the other museums had between 1 million and 2 million visitors.
The hon. Gentleman specifically mentioned purchase grants. There has been a good deal of misunderstanding about the rôle of the Government in relation to

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annual purchase grants and special purchase grants. Much of the misunderstanding has been fostered by those who are not wholly in favour of the policies of the present Government. It is believed quite widely that we have been less generous in this area than previous Governments. It is also believed that I have been less appreciative of the efforts to provide benefactors than have some of my predecessors. This is not true. We have substantially increased the level of grants. They now stand at £3½ million a year compared with £1½ million a year for the previous five years.
As regards special grants, as I pointed out on 2nd March in reply to a Question on the Donatello, the grants have always been intended as finance of last resort when other public and private contributions have been exhausted. It is a cause for satisfaction rather than criticism that the generosity of the public and the efforts of the Victoria and Albert Museum, whose director is one of my officials, and various trusts meant that the taxpayer did not have to provide yet further funds for the purchase of a plaque.
It is not a cause for reproach that private benefactors were generous enough to relieve the Government of the necessity to put their hand further into their pocket for the Donatello.
Mr. Robert Cooke: There was never meant to be any criticism along those lines. I have no responsibility for what an hon. Friend said from the Front Bench on 2nd March when he gave me far more credit than I would claim in regard to the Donatello. The criticism was that, at the outset, the Minister made remarks to the effect that, if public subscription failed to produce sufficient money, there might be a question of mortgaging the future and drawing against future grants of the V and A. In the minds of many people, that left the impression that the Donatello would be purchased anyway. That is what some of us objected to, and I hope that the Minister will think carefully before saying anything like that again.
Mr. Jenkins: One wants to maximise private benefaction while not giving the impression that the Government are not interested. It is almost impossible to say anything that does not give someone the opportunity to make one of those two
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charges. It is a difficult line, but we shall endeavour to follow it.
In relation to what the hon. Gentleman said about mortgaging the future, this is a well-established practice. Titian's "Death of Actaeon" was bought by the National Gallery, which used its advance funds up to £450,000. This could be regarded as an interest-free loan which anyone in business would be delighted to obtain. There is no need to worry too much about this matter. If I were the director of a museum, I would be reluctant to commit my annual purchase grants unless I felt I had to do so.
I do not think I have fallen short in expressing my appreciation of private benefactors. Indeed, once or twice I have almost crossed the dividing line between appreciation and effusiveness. I want to show a proper appreciation of private benefaction, because without it we should not have been able to save as many valuable objects for the nation.
On the question of the Turner collection, my right hon. Friend the Secretary of State for the Environment has examined how to use to best advantage the Fine Rooms at Somerset House. He has considered very carefully the various views put forward by the Turner Society and others at a recent meeting convened by my noble Friend the Under-Secretary.
I must speak rather carefully, but the Government will consider this matter fully with the trustees of the institutions concerned—most of the paintings are properly held in private or public collections and cannot be freely disposed of—before coming to a decision. We shall have regard to the resources available if a major change in the arrangements for the display of Turner paintings in the care of the nation is desirable or feasible.
The Jubilee is not a matter which is primarily my responsibility, although I am deeply concerned with it as a member of a ministerial committee which is considering it.
Mr. Robert Cooke: Which Ministers are considering the matter?
Mr. Jenkins: It would be improper for me to give that information, but the fact that the question has been asked will be duly noted for another place. I shall see that it is and that it may be

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answered by another, perhaps more senior, Minister on another occasion.
I have asked the Arts Council to ask its beneficiaries in making their future plans, to take into consideration the coming of the Jubilee, and to make preparations accordingly wherever it is possible, so that celebrations may take place without involving the nation in any excessive cost. Her Majesty the Queen has expressed her wish that this should be so.
The Evening Standard of 17th March 1976, after referring to some of the matters to which the hon. Gentleman has drawn attention, such as the achievements of the National Theatre, the visit of the Royal Opera Company to Milan and various of the other artistic achievements of this country, concluded its leader with the following words:
"No country so rich in talent, with such a healthy balance of cultural trade, can be all that ailing. And it is something for Mr. Wilson to reflect on with pride that it was under his early administration that a realistic policy of State support for the arts really came into being."
What the newspaper implies but does not say, and what Jennie Lee, with characteristic generosity, has said, is that to keep this precious child of a Labour Government healthy and growing in the winter of the 1970s is perhaps no less an achievement than was the act of giving it birth in the summer of the 1960s.

JOB CREATION
1.52 a.m.
Mr. Greville Janner: I am happy to have the opportunity to raise at this ungodly hour the subject of the job creation programme and to congratulate the Government on the increase, however modest, in the appropriation for that programme. I should like to do so, if I may, by using the city of Leicester and its unemployment problems, the sort of help which the job creation scheme has been able to give and, indeed, the help which it should be giving, as a spotlight both upon the programme and upon the problems with which it is designed to deal.
The city of Leicester—part of which I am privileged to represent in this House, as my father was before me—was
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called until recently the richest city in Europe. For generations it has enjoyed prosperity. Indeed, even during the recession in the 1930s it managed to maintain a high level of employment and a low level of unemployment.
Unfortunately, that situation has now changed. The old craft industries of boot and shoe manufacture, of hosiery and textiles and the modern industries of light engineering are all suffering in a recession which is causing a blight to fall upon cities such as Leicester and has resulted in those cities needing help—help which they can to some extent promote for themselves but which must also come from the Government.
I well recall, in the days of the last Conservative Administration, asking time after time about the unemployment situation in Leicester and being told with total complacency that Leicester's unemployment was well below that of the average city and far below that of the depressed and under-privileged areas. Time after time I begged the Government of the day to recognise that unless something was done to help the city of Leicester it would join the ranks not merely of the average but of those suffering worse unemployment than the average. Alas, that has been happening, but now the trend has evened out. Now the numbers are only—I specifically use the word "only" in sad parenthesis—those of the average. However, cities like Leicester need help. The job creation programme is a beginning, but only a beginning, to the type of help that they need.
I shall briefly give the House some figures. The unemployment rate in Leicester in February 1975 was 3·1 per cent. of the working population, or 7,043. In January 1976 it had risen to 14,366, or 6·4 per cent., dropping in February to 12,306, or 5·5 per cent., when 1,700 students were taken off the list. There has been a doubling of the number of unemployed in one year. These figures will cause unhappiness not merely in the city of Leicester but to all who are concerned with the preservation of employment in similar areas.
The national unemployment average is 5·5 per cent. and this month Leicester's unemployment is also 5·5 per cent. Therefore, this once very prosperous city is now along with the average. This city of

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initiative, verve and industrial enterprise is battling hard to try to create jobs at a time when the number of vacancies is falling heavily. The number of unfilled vacancies, for example, in Leicester in February 1975 was 1,398 and it is now down to 840. Worse still, in July 1975 11 per cent. of those who were looking for jobs were under the age of 20. Today they comprise 14 per cent. It is in the sector of youth that the job creation scheme can prove so supremely valuable, if only acting as a means of keeping young people busily and happily engaged at a time when they would otherwise be rotting in the heap of unemployment, just when they should be starting to enjoy the understanding of work and the comradeship of labour.
The job creation scheme in Leicester—the number of jobs is small—is sponsored by the council. The riverside improvement scheme provides 10 jobs; the Belgrave neighbourhood decorating scheme five skilled trades; the watercourse clearance scheme, which is council-sponsored, nine jobs; and the Saffron Lane building of an adventure playground, three jobs. There are two other schemes which have not yet been approved, but I hope that they will be soon approved—namely, the derelict land clearance and re-utilisation scheme, five jobs, and the Severn-Trent Water Authority scheme, four jobs. The total is 36 jobs. Although this is a very small and, indeed, minuscule drop in a pool of unemployment which is too great, nevertheless it is something hopeful, and at this time it is as well that we look for something hopeful. Leicester is looking all the time.
We also have a scheme to boost the jobs—a scheme which the council itself is promoting. I am sure that the Government will be pleased about this because the less job creation that is done outside and the more inside, the happier everyone will be.
Councillor the Reverend Ken Middleton said:
"We want a more flexible attitude to the Industrial Development Certificate to maintain Leicester's economic health and to arrest further economic decline."
I am sure that my hon. Friend the Minister will bear this in mind. The job creation scheme is only one aspect of a
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series of programmes. I am sure that my hon. Friend will be good enough to draw to the attention of the Secretary of State what Councillor Middleton said and what is being done in the new drive to attract and promote new industry and jobs in the city.
This is a sad situation which is being reflected elsewhere. There are other areas with higher rates of unemployment. There are no areas which have better absorbed a vast influx of immigrants than Leicester. The city is to be congratulated and helped to do its job properly. Its problems deserve understanding and its leaders deserve congratulation for the efforts they are making. The job creation programme should be extended far wider among young people in the city.
We are witnessing a trend in which the Government are trying to help, and I know how concerned the Government are. We have problems which require cooperation from the Government, from industry and from local Members of Parliament. I appeal to all industrialists whose companies are in trouble not to wait until the last minute to make the nature of their problems clear. I appeal to them not merely to give notice of redundancies as required from 8th March by the Employment Protection Act, not merely to help with the job creation programme, but to let people know what is happening as early as possible so as to prevent closures which are not inevitable.
I wish to draw attention to the sort of problem which is created unnecessarily. We had in Leicester the firm of Stibbe-Monk, which employed 1,800 people. One day it was discussing with the unions a rise in pay for the employees, and the next day it called in the receiver and threw 1,800 people out of work. When I spoke to the chairman about it, he had the gall to tell me that it was none of my business and to ask why I was "interfering" and "getting so cross". The answer was, of course, that 1,800 of my constituents were out of work. I told him to forget the past and to tell me what I could do to help for the future. At that he said "Perhaps you would go to Tony Benn and ask him for help". With three months' warning I might have been able, even with that company, which was riven with inefficiency and driven apart by family quarrels on the board, to do something to help. But with only one day's

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notice of closure, there is little that can be done.
One particular company among others has seen fit to act properly, and I congratulate it on doing so. The job creation programme will be needed for part of its work force, but for only a part. That company is Decca, which has an audio-visual plant on the new Parks Estate in my constituency. Several months before it planned to close that plant, it warned the unions, which informed me. After a series of meetings it decided to keep the plant open. It will employ only 100 people for the moment, but the plant will be ready for the upturn in trade. I hope that there will be an extension of the temporary employment subsidy to enable firms to plan further ahead.
We have the firm Bootons, which is a branch of Courtaulds and is proposing to close. It gave notice well ahead—even though that happened well before the coming into force of the Employment Protection Act requiring notice of redundancies. I compliment this company on giving more than three months' notice. Now a meeting has been arranged between the responsible main board director of Courtaulds, the chairman and managing director of Bootons and myself for next week to see whether there is any way in which something can be done to preserve those jobs. I can hold out no hope of results, but unless we try we are bound to fail. Decca also announced its intended closure, but the plant has continued working. If we can work together to keep plants open and alive, we may get results. We need the Government's help to keep jobs open and to promote employment in the city of Leicester so that the city's trade may boom again. In the meantime, we need help in the form of temporary employment subsidies from the Government and, alas, help over job creation for young people, who are most likely to be adversely affected by the sort of conditions that exist throughout the country.
I congratulate the Government on the help they give. I hope that the Minister will indicate that that help will be extended both generally and in the city of Leicester.
2.6 a.m.
Sir Anthony Meyer: The entire House must be grateful to the horn and learned Member for Leicester, West (Mr. Janner) for having raised this matter tonight. I am sure that his constituents will be as impressed as I hope mine will be that we are here at 2 a.m. to tell the Government of our very real concern for the plight of those in our constituencies whose jobs are now at risk.
It always seems to be my misfortune to have to start being querulous about the Government's employment policies when I am faced with so able and amiable a Minister as the Under-Secretary. However, at least on this occasion I can avoid the rather harsh exchanges which necessarily occur at Question Time when one has the impression that Mr. Speaker thinks that two words instead of three would suffice.
Although I appreciate the motives which prompted the Government to embark upon this job creation programme, I still have some fundamental reservations about the programme as a whole. Whatever view one may take about the effect of this programme on long-term employment prospects, it would be absolutely wrong to under-estimate in any way the appallingly demoralising effect which unemployment has on young people. They leave school full of high hopes after a period of studying, absorbing knowledge and sitting listening to what they are told. They long to get out and to do their own thing, to stand on their own feet and to start making their own way in the world. For such young people to find that there are no jobs for them and that they must stand in dole queues is a demoralising experience and can have a bad effect on them for the rest of their careers.
If only on that account, there would be justification for the Government to some extent to get outside the laws of economics and sound marketing principles, and to influence events in such a way as to enable young people to have some kind of work to do, even if it is a long way short of a satisfactory job. I want to emphasise that I fully sympathise with and understand the motives of those who have started this programme with this consideration at the front of their minds.

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I listened with a feeling of envy to the hon. and learned Member for Leicester, West when he spoke of his unemployment rate of 5·5 per cent. I am not wishing to cast any scorn on that, because for a city that has known full employment, as Leicester has, a 5·5 per cent. unemployment rate represents a very severe setback to hopes and expectations, and hardship consists every bit as much of frustrated expectations as it does of actual loss of job. None the less, in my part of the world, and particularly in the western part of my constituency, I have a rate of male unemployment which at the last count was 18·7 per cent., and which I very much fear, according to news which has been reaching me in the last day or so, is liable to go higher still before we see any downturn, because of redundancies being notified to me by ITT at Rhyl.
Mr. Greville Janner: I fully accept what the hon. Gentleman has said. I hope that I have made it plain that even within cities such as Leicester, unemployment is very patchy. I went to one school at which I understand that even today 45 per cent. of the children have one or both parents unemployed. Even if the overall city rate is only 5·5 per cent., that is not spread out evenly through the city and there is great hardship for that 5·5 per cent., although that in no way denigrates the cities that have a worse rate of unemployment.
Sir A. Meyer: I fully accept that. Having previously represented a constituency with a very high immigrant population, I know how patchy unemployment can be, and how it can badly affect the immigrant community in particular.
I am very much concerned by the impact that the job creation programme could have on the appallingly high unemployment level in my constituency. I am naturally very much under the sway of pressures which build up for the Government to do something, to take short-term measures and to take steps to give people a feeling of hope. In addition to the job creation programme, when one has a situation such as is developing at Courtaulds on Deeside, of very large-scale redundancies—about 600 have been declared—there is a need, quite apart from schemes such as the job creation programme, for people who have been made
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redundant to feel that the Department is sending people in straight away to advise and to help them.
I take this opportunity of paying tribute to the hon. Gentleman and his Department, who in this respect, as always in the past, have been very prompt in providing advice and help to people whose jobs are about to be taken away from them in this terrifying manner.
However, now I pass from the complimentary to the more critical aspect of what I wish to say. We can see from the Estimates that provide the justification for this debate that this programme is by no means an inexpensive programme. It is a programme to provide—by admission, I think—jobs of low qualification, unskilled jobs in the main, and principally for young school leavers, in addition to the other aspect which is less open to criticism—that of inducing firms to keep on people whom they would otherwise declare redundant.
This is where I begin to cross the line. One of the difficulties that have bedevilled the economy of North Wales has been the excessive preponderance of low-paid, relatively low-skilled jobs. The area badly needs what the Wrexham industrial area exists to provide—a nucleus of highly skilled technologically advanced employment. In this respect the job creation programme is of no help at all. On the contrary, precisely because it is an expensive programme, it constitutes a further burden on industry and, in particular, on the kind of industry which areas such as North Wales—areas of low economic activity and low average wages—so badly need.
It is a kind of equation or balance. On one side of the scales we have the jobs which are created or saved by this programme. On the other side of the scales we have the jobs which are lost or not created because the cost of the programme has to a large extent to be borne by industry which is thereby prevented from creating new jobs or is obliged to cut down on the jobs which it already provides.
Almost all the jobs on the plus side of the scales are of the type which we already have in too large numbers in North Wales—unskilled, low-paid jobs—whereas a fairly high proportion of the jobs on the other side of the scales—

1757
jobs which are lost or not created which otherwise would have been created—are of the type we badly need.
It is because of this disparity and the fact that this programme tends to emphasise a trend which is in itself unsatisfactory that I remain markedly unenthusiastic about the job creation programme. I pay full tribute to the good intentions of those who have created the programme, but good intentions do not always produce good results.
2.17 a.m.
The Under-Secretary of State for Employment (Mr. John Fraser): I am grateful for the terms in which my hon. and learned Friend the Member for Leicester, West (Mr. Janner) and the hon. Member for Flint, West (Sir A. Meyer) have made their points in this debate. I am as concerned as they are about this problem. I am particularly concerned about the male unemployment rate in some parts of North Wales referred to by the hon. Member for Flint, West. I share the concern expressed by my hon. and learned Friend the Member for Leicester, West about the unemployment rate in Leicester. Two years ago it was below the national average, but now it is equal to the national average. The figures quoted by the hon. Member for Flint, West speak for themselves.
I am grateful for what has been said about redundancy notices. It is totally unacceptable that a large number of people should be put out on the stones, as it were, at a moment's notice. One of the reasons why we introduced the provision in the Employment Protection Act for a long period of notice was to provide time to mobilise the skill, facility and advocacy of local Members of Parliament and other interests to bring pressure to bear on Government Departments. My hon. and learned Friend has played a particularly constructive part in bringing such pressure to bear and in averting redundancies. I hope that he will continue to do that.
I am sure that the hon. Member for Flint, West will agree that the period of notice which is now given enables Members of Parliament, local industrialists, trade unionists and my own Department and other Departments to bring their minds to bear on the difficult problem
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of redundancy. It gives them time to consider whether to make use of the temporary employment subsidy to save jobs and any other remedies which may be available. I am sure that both my hon. and learned Friend and the hon. Gentleman appreciate the provisions in the Employment Protection Act which have operated since 8th March.
Mr. Greville Janner: Would my hon. Friend be prepared to echo the appeal I have made to industrialists that they should not merely comply with the law but should harness their local Members of Parliament as early as possible to bring pressure to bear which might avert closures and the loss of jobs—something which cannot be done if Members of Parliament find out about closures only from Press, radio or rumour?
Mr. Fraser: I wholly agree. I have been in exactly the same position in my constituency where an electronics factory is closing down, with the loss of about 700 jobs. I was grateful that the firm gave me early notice because I was immediately able to get in touch with the Department of Industry, my local authority and others. I hope that other industrialists, faced with this situation, will mobilise the sort of advocacy which is available.
The Labour Government were born to fight unemployment and the distress flowing from it. We regard the present unemployment figures as unacceptably high and a challenge to the Government and the Labour movement. We have taken unprecedented steps to deal with the immediate symptoms of high unemployment.
The hon. Member for Flint, West has not been too critical and I am grateful to him for the tone that he adopted. What he was saying was that job creation, the temporary employment subsidy, and the training schemes, are not an alternative to the provision of permanent employment. I wholly agree. My hon. and learned Friend was making the same point. I do not regard job creation and the temporary employment subsidy as a substitute for a firmer and more secure industrialised base, either in the constituency of my hon. and learned Friend or that of the hon. Gentleman. It is right, in this situation, to try to deal

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with the symptoms as well as to try to achieve the long-term objectives.
That is one of the reasons why we doubled the size of the Community Industry Scheme and why we had a massive effort to increase the amount of training available. Time and again—even now in parts of the country—we find that industry is being held back because of a lack of skilled manpower. The training programme, which is massive, not only brings an immediate amelioration of unemployment but is an investment in our long-term future. We have done a lot to increase the size of the careers service to deal with the immediate symptoms of unemployment.
We have introduced the temporary employment subsidy and, in the light of representations from hon. Members, the trade unions and local authorities, we have three times modified that scheme. Our minds remain open to suggestions for new initiatives that might be taken to deal with the problems facing us. We have done other things. There is the recruitment subsidy for school leavers.
The debate is mainly about job creation. We have taken unprecedented steps to provide work, albeit of a temporary nature. On 9th October the Government announced a £30 million subvention for this scheme, another £10 million on 17th December and another £30 million on 12th February. That amounts to a total of £70 million which will provide about 55,000 jobs. I regard that as a fairly considerable contribution to providing temporary work. While this is not aimed exclusively at the young it is particularly important that young people should not have their ambitions frustrated and become disillusioned at a time when they wish to make a contribution to society.
So far, we expect the scheme to provide a total of 55,000 jobs. By 12th March, there had been 2,204 applications and 13,993 jobs created with a total grant of £16 million. The rate of response in the Principality of Wales has been so good that, later today, the Manpower Services Commission will be making an announcement about further development of the scheme in Wales. In the Midlands—and I am not castigating Leicester, which was one of the first off the ground—there has not been quite such a response. But if hon. Members would like to get in touch
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with the Manpower Services Commission and would like to organise local meetings, not just with local authorities but with private interests, charities and youth organisations, the Commission will be willing to give all the help and guidance that it can to that kind of initiative. I emphasise that the sponsors of job creation programmes are not limited to local authorities. There is no limit upon the kind of organisation which can put up a job creation programme.
The hon. Gentleman said that the cost was high. I want to rebut that. It is true that the average gross cost in each man year of employment created is about £2,000. But the net cost, when allowance has been made for the savings in unemployment benefit and social security payments and the proportion of income that is returned in tax, is estimated at only £600. That is a pretty good bargain in terms of getting something useful produced, getting someone into a work situation and of the savings in unemployment benefit. It is money well spent, bearing in mind that it does not take into account the value of the work done and the sponsor's contribution to the costs. The average gross cost of each job created is £1,183, and the net cost is about £350. As I say, about 55,000 jobs will be created under the scheme altogether.
The hon. Gentleman said that the jobs were of low-skill content. There is, of course, a variation from one scheme to another. But we should not look disdainfully at low-skill jobs. For someone who is unemployed and wanting to make a contribution to society, it is better to be voluntarily employed, even on a low-skill project, than doing nothing. What the job creation programmes have tried to do is to create jobs making a useful contribution to the community involving the gaining of basic skills and perhaps an interest in a future career.
I can give three examples. On a visit to Sunderland, where they have been extremely objective in their approach to job creation programmes, I saw some young people, who had been unemployed, working in a school for fairly severely handicapped children. The moment they got into it, their interest in education and in the very difficult problems of caring for these children was aroused. Their interest was heightened. I spoke

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to a couple of them, who told me that after some experience in it they were thinking of making their careers in this kind of occupation.
The second example involved a group of young girls and boys working developing a play group. Again, within a matter of days, they began to evince an interest in education and the care of children.
The third example which I saw was of young people working in an old people's home. Immediately, they were not simply doing menial tasks. They were learning something about chiropody, basic physical medicine, exercise and the care of elderly people. Once again, a whole vision was open to them of the careers which they might pursue.
My hon. and learned Friend has stolen my thunder by giving other examples of what has happened in Leicester already. However, the aim of the programme is not only to provide work but to provide a vision of the future potential of a young person. I defend the job creation programme, even though it does not result in the provision of permanent work. It is right, and this is a useful expenditure of money.
I have been asked about permanent jobs. We are facing a difficult situation. Some unemployment factors are within our control but there are others in which we have no autonomy. Those factors within our control involve this country remaining competitive and becoming more competitive. In order to underline long-term job security it is essential to deal with inflation. The £6-a-week pay policy is now recognised as being a long-term guarantee for competitiveness and job security.
The Government have announced investment programmes for factory building and assistance to industry, in machine tools and so on. For too long we have not invested enough in industry. This Government has put more emphasis on investment in production machinery as opposed to investment in title deeds and paper. Other matters, such as the world recession, are outside our control. I do not disagree with the Secretary of State's description of the situation as being a crisis of Western capitalism.
It is not enough to be frozen in mutual timidity, waiting for the tide to turn. We
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must not wait for other people to reflate or for the tide to turn. We must make our own contribution to a new system in the international councils such as the International Labour Organisation, OECD and the EEC. Nations can jointly make a contribution towards increasing demand and creating a better and more sensible system for the Western world.

FOOD SUBSIDIES
2.32 a.m.
Mr. Michael Neubert: This is an advanced hour of the night to be discussing the familiar subject of food subsidies. Had I not known that the Minister was a restless sleeper and would welcome the opportunity to exercise his mind on parliamentary business, I would have hesitated to raise the subject.
The sum of £11,200,000 is an important amount. The Government are borrowing at the rate of £1 million a month and such a sum might seem to be a mere pepper corn of public expenditure, but to ordinary people it is an enormous sum of money which is well worth scrutiny even in the small hours.
I am concerned not so much about the increases themselves as about the reasons for them. They cover five of the six subsidised foods. In four cases they relate to increased consumption. An increase in estimated consumption is mentioned in one case and in three others an increased estimate in consumption is mentioned. There may be some semantic nicety in that, the full significance of which I do not appreciate, but no doubt the Minister will enlighten me. We are considering an increased Vote to take account of consumption in excess of that which was expected. We warned the Government that food subsidies would encourage an increase in consumption.
There has also been an increase in consumption of cheese, the other subsidised food. The Secretary of State had to act on 1st February to reduce the subsidy by 2p in the pound to achieve a saving of about £11 million—approximately the sum that we are discussing tonight. It must have been a recurrent nightmare for Ministers at the Department to think of fat business men at expense account lunches gorging themselves on subsidised cheese boards. But

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that was pointed out to be an inevitable consequence of indiscriminate subsidies on basic foods.
There are other side effects, such as the adverse effect on our balance of payments, particularly with the other countries of the European Community, a matter about which the Minister's hon. Friends complain vociferously. I have no doubt that there will have been an increase in the consumption of Edam and Gouda cheeses, for example. It would not surprise me if a bouquet of tulips is delivered to the Secretary of State daily by the grateful burghers of Amsterdam. I am sure that each night in the Danish villages of Samsoe, Elbo, Danbo, Maribo, Tybo and Fynbo—always assuming that they are place names and not the Danish equivalents of Crackerbarrel—cheese makers tell their children to say a prayer for the kind lady across the sea who contributes £4½ million a year to promote the sale of their fathers' products.
There has also been an increase in the consumption of tea, and no doubt tea planters in the foothills of India and Ceylon are grateful that the Secretary of State decided to subsidise the English practice of tea drinking. It had been declining until then. We face these sums of money directly as a result of encouraging increased consumption by subsidising foods.
It is also an unfortunate fact that, despite expenditure now totalling no less than £537,700,000, this support is insignificant to the people of this country in the fight against inflation. The effect on food prices has been calculated as 1·3 points on the retail price index, or 0·9 per cent. We have come through a year in which inflation reached its peak in August at 26·9 per cent. Therefore, to achieve a moderating effect of 0·9 per cent. is as pitiful as a pea on a drum.
That is not to say that the subsidy has not been welcome where it has been of support, and no doubt the Minister will make his case that it is intended to be discriminating. But I contend that it is far from that. The Under-Secretary of State for Employment has just made plain, and claimed credit for, the success of the £6 pay limit. If we see that as a factor in the fall that is gradually de-
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veloping in the rate of inflation, we must also recognise that the lack of such a policy last year was instrumental in causing an unprecedentedly high rate of inflation.
In all the other countries of the Community the rate of inflation increased less in the year to last December than in the previous year. We are the exception, and the reason is clear. It is that despite the offering of food subsidies to the trade unions as part of their pact, that pact was not honoured. The Government were a jilted partner in the social contract. The unions took the dowry of the food subsidies and went on a wage spree which led to average wage rises of 35 per cent. That is why we had such a high level of inflation.
The food subsidy is also insignificant in the fight against inflation by comparison with rises in the prices of other foods. For example, the cost of potatoes has added about 3½ per cent. to the food index. That compares closely with the total effect of subsidised foods on the food index, which is calculated at 4 per cent. Potatoes are not the only basic food rapidly increasing in price. The rise in the food price index, as opposed to the retail price index, must be a matter of great concern to the Minister. Bacon, for example, has gone through the £1,000 a ton barrier. Beef is running at very high levels and so is instant coffee—68p now for a 4 oz. jar.
In these respects the beneficial effect of these subsidies, is highly limited to say the least. If the Minister is going to argue that these increases will benefit those less well off more than the average public then he must recognise that there are compensating and offsetting disadvantages for these people. For example, there was the introduction of VAT on food, which will have had some effect, and the increase in the cost of basic commodities to pensioners, such as beer and tobacco. When one considers that the total effect of all these subsidies is calculated at 41p for a pensioner couple a week, then very quickly the food subsidy benefit evaporates. Likewise, we see an increase in the cost of school meals in September 1976. It is calculated that the effect of food subsidies on an average family with two children is about 71 p. If school meals are to be increased in price by 5p in September that means, if

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those two children are at school, an increase of 50p, virtually wiping out the effect of the benefits from subsidised foods.
In this respect these seemingly large sums are very small in their impact on the people the Government are seeking to help. We take issue, not on the principle, but on the method by which the Government are increasing food subsidies at a time when it seems that their significance is very much in doubt.
Next comes the question of the ineffectiveness of this method. The point of subsidies is said to be that although they are blanket in their approach, they reach a considerable number of needy people because they are concentrated on basic foods in the low income earners' budgets. But that must be set against the background of the way in which these very people have been hit by Government policy in recent months. The burden of taxation now weighs very heavily on them—in some ways more harshly than on those who are better off. The recent White Paper on Public Expenditure has made it clear that income tax is now being imposed on people whose income is below social security benefit level. We have an example where the Government are on the one hand seeking to give more of the public purse to those people and, at the same time, are taking it away. Income tax now, for the first time, provides more than half the total tax revenue.
The Minister may not yet have seen a report published yesterday by the Institute of Community Studies which says that even where these low earning families have received the £6 pay award, they are substantially worse off as a result of these and other factors. He should seriously consider whether this immense apparatus of control is appropriate to the need he wishes to see met amongst those families, particularly families with children, at this time of high inflation. I hope he will not argue, as he has argued in the past, that either the Opposition do not wish to see a reduction in the rate of inflation or any alleviation of the present situation or that we are totally and doctrinarily opposed to subsidies. It would be folly to sustain such an argument when our way of life is riddled with subsidies of one sort or another. Cross-subsidisation exists in commerce. It
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would be a very dull and neutral place it everything were carefully costed and the exact price put on every product or service. That is not the case, and we are not suggesting that it should be. But we are suggesting that this effort and expenditure is misapplied, that there are ways—they may be crude, but not so crude as this—in which those who need help can be given it, for the same amount of money or less.
The Christmas bonus of £10 to pensioners is also open to the charge that it goes to all pensioners regardless of their resources, but it is a direct help to a category of people who are normally assumed to be less well off than the general community. This is borne out by the Minister's own references to the pensioner index. So it would be a rather more refined means of assisting the needy than the present blanket approach—which includes him, and me and you, Mr. Deputy Speaker, and the public at large. The beef tokens which enjoyed a short currency were also given to pensioners who no doubt needed them, but they also went to many old-age pensioners who did not need them.
Although the Minister can argue that food subsidies like this are less costly to distribute, it would cost much less to direct this expenditure to those who really need it. We should aim for a reduction rather than an increase in food subsidies. I have taken some encouragement in the past from the Government's declared undertaking that that was their intention. These increased Estimates seem a faltering in the Government's purpose.
Last July, in order to secure wage restraint, the Government committed themselves to another £70 million in food subsidies over what they had planned for the next financial year. When the next round of negotiations with the unions starts, with the object of even more severe wage restraint, who can say that food subsidies will not yet again be one of the prices that the Government have to pay? I hope not. I think that the Minister would agree—he would probably think of the longer term, whereas I would want it accomplished much more rapidly—that food subsidies should be removed in favour of a much more discriminatory system of social assistance to those who need help. They are not getting adequate help by this means.

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I hope that the Minister will reassure us that, despite these increases, it remains the Government's intention to phase out food subsidies in the foreseeable future. The sooner this country is shot of these indiscriminate subsidies the better.
2.49 a.m.
The Under-Secretary of State for Prices and Consumer Protection (Mr. Robert Maclennan): I am grateful to the hon. Member for Romford (Mr. Neubert) for initiating this debate. I had wondered what line he might take, since he has not so far evinced a great interest in this subject in the House. He asked a Question back in December 1974 when he gave figures to show that earnings were rising more rapidly than prices and asked for the fulfilment of the social contract. I had hoped, perhaps vainly, that he might take this opportunity of congratulating the Government on the success of the social contract and their pay policy. As the hon. Gentleman will have noticed, the increase in earnings over the most recent 12 months has decreased to about 20 per cent., and the increase in prices to 23 per cent.
Mr. Neubert: I am astonished that the Minister should think I have shown no interest in food subsidies. I was a member of the Committee that considered the Prices Bill and I spoke on that Bill on Second Reading. Modesty forbade me from mentioning that what I was saying more than 12 months ago has come to pass.
Mr. Maclennan: Perhaps I was less than fair to the hon. Gentleman. If so, I withdraw. Perhaps he has been less persistent than some of his colleagues in hounding myself and my Department on this subject. For that I had better express my gratitude.
I should be the first to confess that in our battle against inflation we still have a long way to go, but I think that the House must recognise that the trends are encouraging and in the right direction. In the past six months the increase in prices has been under 7 per cent. Perhaps it was too much to hope that the hon. Gentleman would welcome that progress.
The present situation is very different from that which we faced when taking office two years ago. Prices were then
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rising sharply and causing considerable concern to the poorer families in the community, who necessarily spend a larger proportion of their income on food and other basic essentials. New and effective schemes of social assistance take time to prepare, and we therefore developed a food subsidy programme during the course of 1974 with the primary object of shielding low income groups from the worst effects of inflation. We significantly increased the subsidies paid on milk and butter, which had earlier been introduced by the previous Conservative Administration, and we brought in new subsidies on bread, cheese, tea and flour.
At present we estimate that the food subsidy programme is saving a typical family of two adults and two children about 70p on its weekly food bill, and that an old-age pensioner couple is saving about 42p. These are not small sums for poor families. I accept some of the hon. Gentleman's points about other costs that have to be borne apart from increased food prices, but that is not to belittle the impact of the food subsidy benefit. Without the subsidy programme the food index would be some 5¾ points higher than it is at present, and the RPI about 1·3 points higher.
We have long made it clear that the food subsidy programme was intended as a temporary measure due to extremely high inflation rates. We earlier announced our commitment to improve schemes of social assistance. These improvements are now coming on stream. Last year there were two increases in pensions and other social security benefits. In November 1975 we introduced a non-contributory invalidity pension. Next month we shall begin paying the special benefit for one-parent families prior to the introduction of child benefits in April 1977. Furthermore, benefits will be regularly reviewed in the light of the general level of earnings and prices. All this is no mean social achievement. It must be set against some of the hon. Gentleman's strictures.
On the counter-inflation front, we are on course towards our target of reducing the rate of inflation to single figures by the end of the year. It is against that background of real and tangible progress in our counter-inflation programme that

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during the next financial year we shall review the food subsidy programme.
The hon. Member made what have become familiar criticisms of the subsidy programme. He claimed that we had no control over expenditure, because we are seeking some extra financial provision over and above that sought in the originally published Estimates. When one looks into those carefuly, however, the charge of open-endedness is simply not borne out. The original Vote for my Department was for £505 million. Subsequent supplementaries, including those under discussion tonight, have brought the total to £545·5 million. Of the increase, £16 million is the result of an increase in the rate of subsidy for butter which took place before the beginning of the financial year but after the publication of the original Estimates. There is also a substantial increase on milk, where the guaranteed price to producers has been increased following devaluations of the Green Pound which hon. Members opposite have welcomed. If we exclude these elements, the excess expenditure is no more than about 2 per cent. of the original forecast. We never suggested there would be inelasticity of demand for subsidised foods, but given the uncertainties of forecasting levels of consumption, this constitutes only the smallest margin of error. Certainly it does not sustain the charge of open-endedness or lack of control.
The hon. Member also complained that the Government might not eliminate subsidies quickly enough. The Opposition have made a great point of their wish to eliminate the subsidies, although they have not ventured to say how quickly they would choose to do so. We have set out in the White Paper on Public Expenditure a considered timetable for the reduction of subsidies. That timetable is the fastest that would be reasonable, bearing in mind above all the effect on prices and the need for an orderly transition.
I have of course noted the view shared by many of my hon. Friends and by the TUC that we should re-order our priorities so as to allow more money to be spent on the subsidy programme. I have considerable sympathy with this reaction. In view of our advances on the social front, and towards achieving our counter-
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inflation targets, the need for food subsidies will be less pressing than when we introduced them. None the less, I would certainly recognise their continued importance in the immediate future in helping to hold down food prices and their especial value to those with low incomes and those with large families. It was with this in mind that in the summer we introduced a special additional payment of £70 million, as a part of the Government's programme for the attack on inflation.
Food subsidies have played an essential role in the Government's social policies, but because of our successes on other fronts we can now begin to give them a less important part to play. We must therefore seek a balance at each stage between the conflicting need to control public expenditure, on the one hand, and the need to do everything possible, on the other, to hold down food prices.
The hon. Gentleman complained that food subsidies are indiscriminate in their nature and wasteful. We accept that the best course is to improve social security benefits, and this we are doing. In the meantime, it is indisputable that food subsidies are of real assistance to poorer families. Analyses of household income and expenditure indicate that the benefit of food subsidies is proportionately three to four times greater for the lowest income households compared with the high income households. It should also be borne in mind that although the better off families benefit from subsidies, it is they who pay the greater part of the taxation which ultimately goes to pay for the subsidies.
Hon. Gentlemen opposite are in no position to complain about the indiscriminate nature of food subsidies. The last Conservative Government's subsidies to the nationalised industries cost far more than the food subsidy programme and benefited the higher income groups in the ratio of two to one.
Finally, there are the criticisms which have been made—and again tonight—of the bureaucracy needed to run the scheme. Of course we need civil servants to pay out the subsidies and we should be subject to severe and proper criticism, in my judgment, if we did not ensure that the money was properly spent and accounted for. But we do not have to have an elaborate apparatus for the

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purpose. This is one of the attractions of the whole method of seeking to assist the less well off.
The administrative costs are less than 0·2 per cent. of subsidy expenditure, and we are doing our best continually to streamline the procedures still further. I remind the hon. Gentleman that his Government, too, needed civil servants to run the butter subsidy scheme which they introduced in May 1973. The administrative costs are much the same whether the subsidy rate is 2p per lb., as it was then, or 11p per lb., as it is now. What is more, the administrative costs under the social butter subsidy, which we discontinued, were equivalent to about 25 per cent. of the payments made. In fact, the so-called indiscriminate subsidies are substantially cheaper to administer. The Opposition have certainly set us no good example in this.
I hope that the hon. Gentleman will feel that this has been a useful debate. From my point of view, it has shown again the Opposition's ability to create policy in a vacuum, isolated from the real world. They have little concept of the needs of ordinary men and women, especially the less well off, to be able to adapt gradually to changing circumstances.
We introduced food subsidies as a short-term measure to protect people from the whirlwind of inflation. I am sure that that was right. But it would be a mistake to dismantle them all at once, as the Opposition would apparently wish. We must act in an orderly way, avoiding disruption in the market or sudden price increases for those least able to bear them. Our future plans for the subsidies are based on these needs. We shall, of course, keep a close watch on developments as time moves on, and we shall take decisions on the subsidies as the need arises, taking full account, above all, of the interests of consumers.
Question put and agreed to.
Bill accordingly read a Second time and committed to a Committee of the whole House.
Committee this day.

MAPLIN DEVELOPMENT AUTHORITY (DISSOLUTION) BILL [Lords]
Order for Second Reading read.
Motion made, and Question put, pursuant to Standing Order No. 66 (Second Reading Committee), That the Bill be now read a Second time.
Question agreed to.
Bill accordingly read a Second time.
Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

MAPLIN DEVELOPMENT AUTHORITY (DISSOLUTION) [MONEY]
Queen's Recommendation having been signified—
Resolved,
That, for the purposes of any Act of the present Session to dissolve the Maplin Development Authority, it is expedient to authorise—

(a) the extinguishment, by virtue of its transfer to the Secretary of State, of any liability of the said Authority to the Secretary of State;

(b) the payment out of money provided by Parliament of any expenses incurred by the Secretary of State by virtue of the said Act;

(c) the payment of any sums into the Consolidated Fund.—[Mr. Snape.]

MAPLIN DEVELOPMENT AUTHORITY (DISSOLUTION) [MONEY]
  ADJOURNMENT
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Snape.]

PUBLIC TRANSPORT (HEREFORDSHIRE)
3.5 a.m.
Mr. Peter Temple-Morris: I am extremely grateful for the opportunity to raise the subject of public transport in North Herefordshire. I am also grateful for the attendance of the Minister, who looks as alert as ever at this late hour. He is, by now, well used to rural Members such as myself raising this, for us, vital topic. From what he has said in the past, no doubt

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he appreciates our point of view and will realise that while I shall outline many arguments that have been put forward in the House before—some I hope have not—I shall also urge him to take action.
In outlining my concern I am also reiterating something which happened in another place the night before last and also in this House yesterday through my hon. Friend the Member for Shoreham (Mr. Luce).
My qualifications for raising this subject are as good as, if not better than, anyone else's. I represent an area of 600 square miles. There is only one traffic light in the whole area. That traffic light was planned by the last Government and was put in by this Government. There are, within the 600 square miles, very many hamlets and scattered parishes of all descriptions. The journey to such essentials as the shops, the doctor, the chemist and so on is often many miles.
That problem is shared with other rural areas throughout the country. In common with similar areas, our bus services have been getting worse. Services have been contracting and subsidies—as much as we all would like to give them—are not in abundance any more and are constantly under challenge and cut back. Apart from the bus services there is a threat that we may suffer in respect of our train services.
I shall not put too many points to the Minister tonight about trains because a person can deal with only so much at any one time. However, the Minister will know that there is a threat of closure on the Worcester to Hereford railway line with all its stopping points, as well as many other railway lines in the area. Anything the Minister could say about that tonight I appreciate may be somewhat premature, from his point of view, but it would be very much appreciated by my constituents.
There are a large number of elderly people in my constituency and they form the principal sector of the community that is suffering from the problems of rural transport. On the other side of the coin, there are young people. It is difficult keeping them in an area which needs development very badly in order to keep it young and to preserve
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its way of life. The young people who do stay often have to travel a long way to work on a diminishing transport system. That is yet another incentive for them to move away.
I should like to address the House on the subject generally, but I also want to mention some of the background to public service vehicle licensing because it helps to set the scene. I also want to drive home the point that this is not a partisan submission. Far from it—it is bipartisan. It has been recognised by successive Governments that there need to be changes. The original law is extremely dated and comes from the Road Traffic Act 1930 under which control passed from local authorities to traffic commissioners. I shall be giving some more details of this aspect and suggesting that the power should once more go back towards the local authorities.
The recent developments have shown a prevailing drift towards change, but change is a long time coming. One of the most recent examples of this change is the Transport Act 1968 which was passed by a previous Labour Government. Section 30 contains two very good provisions—the power to get permits for not more than 12 passengers and the power to have fare-paying passengers not on local authority school buses but on school contract buses. I do not believe that those opportunities are being sufficiently taken up by local authorities or others.
But they are not the answer to the problem. If they were, we would not be here tonight. The next step on the same course was the last Conservative Government's Road Traffic Bill during 1973–74 which got as far as Second Reading. That contained three improvements. First was the legal right to give lifts for payment. Second, it freed the minibus in rural areas from the licensing procedure, provided that there was no interference with existing bus routes. That is a consideration that is stressed by everyone who makes any proposal in this field. Third, the public interest would have become the principal licensing criterion. I appreciate that under the 1930 Act the public interest has to be taken into account by the commissioners but they would have made it the principal criterion.

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Tonight I re-read parts of the Second Reading debate on the Conservative Bill. The right hon. Member for Sheffield, Park (Mr. Mulley), who was Opposition spokesman at the time, approached these proposals in a bipartisan way, and that point should be taken into account. He had a natural concern to protect existing bus services and mentioned that certain points would be raised in Committee, but he had no objection in principle to the proposals.
This matter continues to be raised constantly in the House. The Road Traffic Act 1974 originally contained a clause exempting vehicles of not more than 12 passengers capacity, but that was withdrawn during passage through the House for discussions. The point that must be reiterated is that discussions are still going on.
We come to the last pronouncement on the subject on 3rd December 1975 when the present Minister for Transport announced that experimental projects would be set up in three or four areas. There would be a short Bill, he said, but we have yet to see it. It would implement the exceptions to the present licensing provisions that those projects would require. We are still waiting. How long do we have to wait? If we are waiting, it would be worth waiting for Herefordshire and Worcestershire to become one of the experimental areas. It is ideal for that purpose. It is an intensely rural area, but it is also near to the West Midlands conurbations and it has buses that leave the towns for the rural areas and then return on the same routes. It has purely rural transport as well.
I readily appreciate the problem. We have to establish new licensing procedures and to be fair to existing interests. No one denies that. But no one denies, either, that the existing interests are to a certain extent vested interests. We are dealing with large numbers of men who work hard and earn very good money. They are afraid lest that good money should be taken away. It becomes vitally important to have trade union participation in all the proposals that I am about to put forward. There need be no fear, and it is important for hon. Members on both sides to keep emphasising that fact. If, for example, there is a bus service which runs in the early morning to some remote spot and it is decided that a
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minibus can do the same job and offer a better service, why should there not be rationalisation? It may not mean the end of a man's job—just that the matter should be considered overall.
My suggestions come under one all-important heading. We are dealing with the rural transport and we have to aim in the direction of co-ordinating all available transport in rural areas. There has been far too much wastage, and there are far too many vehicles charging around—one for the school, one for the post, one for the elderly and so on. Every available vehicle must be used in a coordinated system.
I wish to raise some points for the Minister's consideration. First, I want the private car exempted from the licensing system. That is long overdue and has come very near to being passed by this House. People combine unofficially now. It would be more sensible if they could combine officially and be encouraged to do so. It is up to us to give them a lead.
Secondly, and perhaps more important, the small operator and the minibus must be encouraged. It is well worth considering moving both the licensing and route control of such a system on to the local authorities because if the system were superintended by the county councils, the parish and district councils could be brought in. Members of the parish and district councils know where there is a need for a route and where people are suffering—because suffering they are—genuine hardship through having no public transport.
Thirdly, school buses, both contract and local authority-owned, should be coordinated under local authorities. At the moment there is great wastage in this area because the buses deposit the children and after that are not utilised. They must be utilised. The whole system cries out to be co-ordinated. I hope and expect that in whatever experiment takes place, wherever it takes place, co-ordination will be part of it.
Fourthly, the exemption of voluntary organisations is important in rural areas. The Minister will know how important it is for these organisations, from the Church right down to the Women's Institute, to lay on their own transport. According to the definition of the area

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they have to charge their members the fares for the journey.
I turn to post buses. If this has been talked about for one year it must have been talked about for 20 years or more. There are about 30 licensing systems in England and Wales. The Scots, being somewhat more thrifty, have many more. However, I am more concerned with England and Wales, and with Leominster in particular. A Leominster post bus scheme was set up for North Herefordshire. However, we could not find a volunteer postman to run the post bus—and I do not blame anyone for that. It was not a question of any pressure as such on those men but it was, perhaps, a natural feeling that unless a postman is given incentives he is not very interested in becoming a busman as well. If I were him I should not be interested.
It is the duty of the Government and the Post Office to encourage men to do this by financial incentives. The men must be paid for the job. If they go out on their postman's round, they are obviously interested in finishing it and getting home, not hanging around and running a bus service. They would be willing to do it if they were paid for doing it.
In rural areas there is the "dial-a-ride scheme"—which in urban areas is called the "dial-a-bus scheme". The Transport and Road Research Laboratory sponsored an experiment in South Herefordshire. The experiment was abandoned due to lack of funds, but the facilities for such an experiment in Herefordshire as a whole were present.
I have put some suggestions to the Minister. In the time available I have tried to cover a reasonable spectrum and put the claims of my area. By way of summary I put three queries to the Minister. First, how far have the Government got in implementing these experimental schemes and when may we expect some sort of definitive statement about them? Secondly, can these experiments take the form of co-ordination of rural transport in the way that I have described, utilising some of my ideas? Thirdly, I stress again that Hereford-Worcester would be a worthwhile territory for such an experiment and that there would be co-operation by the in-
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dustries and people involved. It is the sort of area that has very good relations all round and that would benefit enormously from such an experiment. I press the area upon the Minister tonight as a suitable site.
3.20 a.m.
The Under-Secretary of State for the Environment (Mr. Kenneth Marks): I must congratulate the hon. Member for Leominster (Mr. Temple-Morris) on securing this debate and on the way in which he has so ably presented the problems facing his constituents. I congratulate him also on his staying power on being present at this hour to start the debate.
The hon. Gentleman mentioned that his constituency covers an area of 600 square miles. Although my constituency has an area of six square miles, with particular problems of its own, from my experience in my office, I appreciate the acute problems in rural areas, particularly of those who have no car at their disposal. On Wednesday I spoke in the debate on railway services and answered questions on minibuses and a number of other points which I am sure that the hon. Gentleman will have noted.
The experiments that the hon. Gentleman mentions take two forms. There is first a series of experiments within existing laws, on which we have a steering committee which I hope will meet very shortly. After that we have a draft Bill which we hope the steering committee will examine after it has seen some of the experiments. The hon. Gentleman will appreciate that we need to consult the other operators and trade unions on this matter. As regards the Post Office, the hon. Gentleman mentioned that the Scots seem to have the edge on us in this matter. It is difficult for the Post Office to arrange a delivery route that is on the same route as that on which people wish to travel.
It is less than two months since I was thanking the hon. Member for Worcestershire, South (Mr. Spicer) for raising a discussion similar to that raised tonight. I have no wish merely to repeat points that I made then. I am sure that the hon. Member will appreciate that we have been conducting a wide-ranging review of public transport policy over the past few months. In the next few weeks, before the Easter Recess, we shall be issuing a

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consultative document on the fruits of the review, and the hon. Member will realise that I shall be strenuously avoiding any attempt tonight at any anticipation of what that document will have to say. The time for discussion of that document will come after it has been issued, and not before.
However, I should like to begin tonight with some basic statistics which will help us to place the situation in North Herefordshire in the context of national trends. The stark fact is that, between 1963 and 1973, passenger journeys by bus fell by two-thirds, while the number of cars on the road almost doubled. But very many people still remain dependent on public transport. In 1974 there were still 44 per cent. of households that did not have regular use of a car. Probably the percentage is less in Leominster than it is in Manchester, Gorton. Nevertheless, there are still a considerable number of people who do not have this possibility. I believe that there has been a pause recently in the growth of car ownership, but I think that it is a temporary pause and that the growth will later continue. Furthermore, it is the less well off sections of the community who do not have access to cars and are, therefore, dependent on buses, and on trains to a lesser extent.
It is hardly suprising, therefore, that 27 per cent. of all journeys to work, 25 per cent. of shopping trips and 42 per cent. of school trips are all made by the local bus. Buses therefore have and will have a key role to play in the life of the community for a long time to come.
It is for these reasons that, within the total funds available for transport, the present Government have given increasing priority to public transport. In 1970–71, 52 per cent. of transport expenditure went on road construction and 24 per cent. on public transport. This year the priorities have been reserved: we are now spending only 35 per cent. on building new roads, and 45 per cent. on public transport.
I now turn to North Herefordshire and the main NBC company in the area, the Midland Red company. In my speech last January I tried to indicate some of the ways in which NBC companies, and particularly Midland Red, were demonstrating their responsiveness to changing
1780
needs. The Norfolk community minibus experiment, in which another NBC subsidiary company is participating, is the kind of project which attracts a good deal of attention, and rightly so. But Midland Red has also been involved in changes which are less spectacular but which, nevertheless, go to meet local authority needs.
I mentioned in my earlier speech the important changes in routes, in service levels and in fare structures which Midland Red has been introducing for example in Kidderminster, in Worcester, in Redditch and in Stafford. All these measures have been welcomed by the local authorities concerned and it is right to remind ourselves of the degree of co-operation which exists between the Midland Red company and the local authorities in these cases.
I appreciate, of course, that measures such as these are applicable mainly to urban areas and therefore have little to offer North Herefordshire, which is deeply rural. The very small and widely scattered settlements in the North-West of the county present very different public transport problems. Conventional stage carriage services here form a pattern typical of such rural areas. Through-routes linking the larger centres of population are provided by Midland Red, with more local needs being met by small independents.
While central Government can set the framework, it is local government which has the executive arm and the clear responsibility to meet local needs through a proper evaluation of local requirements.
The Transport Act 1968 and various subsequent legislative measures, notably the 1972 and 1974 Local Government Acts, have established a system of public transport control which has as its central underlying philosophy the belief that local transport is a matter for local authorities. They are in the best position to assess and evaluate the transport needs of their own areas. This approach to transport planning has been evolved through both Labour and Conservative Administrations and is, of course, administered by local authorities of all political persuasions.
This legislation recognises that this philosophy of local responsibility is

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heavily dependent on authorities envolving a close co-operative relationship with bus operators. I understand that, despite inevitable areas of disagreement, this process of evolution is taking place in Hereford and Worcester. But I regret the slowness of the gestation period in some areas.
The hon. Gentleman will recall that my hon. Friend the Minister for Transport spoke in this House in August last year and emphasised the responsibility which the county councils bore for public transport in their areas. He invited them to reconsider the estimates of expenditure on bus revenue support which they had submitted for Transport Supplementary Grant for 1976–77 and to submit revised estimates, bearing in mind that he had already made it clear that in the 1976–77 allocation clear priority would be given to proposals to maintain basic levels of service, especially in rural areas. My hon. Friend warned counties that, if they decided against supporting services, the assumption must be that the bus operator concerned would have no alternative but to withdraw them.
Hereford and Worcester chose not to accept the invitation and failed to bid for any more than about half of what the Midland Red Company required to maintain its existing levels of service. This is the second Adjournment debate within a few weeks about the public transport position in Hereford and Worcester and about the Midland Red Company. But no amount of talking here will put the resources in the bus company's hands which will allow it to go on running services whose costs cannot be covered out of fare-box revenue. The responsibility for making the necessary resources available falls fairly and squarely on the county council. If it is not willing to meet operators' losses on rural services, there is no alternative but for those services to be reduced or withdrawn entirely.
I know that the county council has considered that it should not contribute towards the Midland Red Company's depreciation and contingency provisions or towards servicing its capital. But these are costs which operating companies have to bear. In the case of NBC companies there are statutory obligations arising out of the legislation
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under which the NBC was established. Again, if these costs are not met either out of fare-box revenue or from local authorities' contributions, with support from the Government, the operator can have little alternative to cutting the local rural services about which the hon. Gentleman and I are so concerned.
In some circumstances, where conventional bus services no longer exist, the county council will need to consider other means of meeting the demand for public transport. Clearly, Leominster offers considerable scope for the judicious use of less conventional services, and the county recognises this. The hon. Member has mentioned the possibility of post bus services in the area, and the county council has actively pursued this idea. Such schemes must be as a result of very careful studies and discussions between all those concerned in order to assess how unconventional services might best help meet the needs of an area. I hope that such close co-operation might be developed throughout Hereford and Worcester. However, this is a matter for the county council to tackle.
The House is aware that my hon. Friend the Minister for Transport announced on 3rd December his plans for promoting experimental schemes in three or four selected areas in Great Britain where rural transport problems exist. These schemes will test on the ground what can be done within the present road service licensing code to help rural communities. The design of these schemes will be the responsibility of working groups which will be set up under the chairmanship of officials from the relevant Departments, with representatives from the local authorities, bus operators, unions and other bodies. The working groups will act under the general guidance of a steering committee embracing similar representation.
We also propose, when an opportunity occurs, to present a short Bill to provide for a modest relaxation of licensing for a limited period within the area of these schemes. But I must point out that we must carefully consider their effect on existing bus services, and the views of operators and trade unions.
I would stress two points about changes in licences. First, licensing is a

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wide-ranging concept, and the full implications of seemingly simple general changes are not always brought out as they should be. Secondly, the difficulties of securing licences—PSV and road service licences—may be exaggerated. The traffic commissioners will always be prepared to give a sympathetic hearing to any application intended to deal with a genuine need that is not otherwise being met. Indeed, the various experimental services which already exist provide evidence of the traffic commissioners' flexibility. But obviously they must operate within the terms of the statute.
The hon. Member referred to rail services, with particular reference to the Hereford—Worcester line. The withdrawal of any rail passenger service is governed by the statutory procedure laid down by the Transport Acts of 1962 and 1968. Under this procedure it is for the Railways Board to propose the closure of any line if in its commercial judgment the line is so uneconomic as to justify this. The interests of users of the service are protected, since the procedure gives them the right to object to the pro-
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posals, and in that event the consent of the Secretary of State is required. That consent is not given until the Secretary of State has been satisfied not only about the commercial case for closure but also about the probable effects of the closure on the social and economic well-being of the area.
No proposal of this kind has been made by the Railways Board for the withdrawal of the Hereford-Worcester service. But, of course, no Minister could ever give a guarantee that any rail service will remain in being for all time. That would prejudice the Secretary of State's jurisdiction in respect of any application by the Railways Board.
I thank the hon. Gentleman for his contribution. I look forward to hearing positive contributions from him and his hon. Friends in the debates when the transport policy review is published.
Question put and agreed to.
Adjourned accordingly at twenty-seven minutes to Four o'clock a.m.

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Preamble
The House met at three of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Salisbury.

ANGOLA AND CUBAN TROOPS
Baroness ELLES: 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 through what diplomatic channels they intend to take action on the removal of Cuban troops from Angola.
The MINISTER of STATE, FOREIGN and COMMONWEALTH OFFICE (Lord Goronwy-Roberts): My Lords, we have made clear from the outset, through diplomatic channels and publicly, our view that all foreign troops should be withdrawn from Angola. Naturally, we remain in the closest diplomatic contact with our friends and allies, both in Africa and the West, on all Southern African problems. We wish to develop relations of friendship and cooperation with Angola.
Baroness ELLES: My Lords, I thank the Minister for that reply. Now that the Cubans have achieved the objective of obtaining recognition and freedom for Angola, is it not time that Her Majesty's Government, together with other members of the EEC, and possibly the United States, took stronger measures against Cuban troops in order that they should be withdrawn either through economic, political or commercial measures or even through the international measures which have been available for some time in the United Nations?
Lord GORONWY-ROBERTS: My Lords, the noble Baroness is suggesting what can only be described as an operation of the West in Africa in present conditions. I would strongly advise that that kind of sectional and possibly ideological intervention would not conduce to the stability and peace of
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Southern Africa. I prefer the views, if I may say so frankly, wisely expressed on the media the other night by the noble Lord, Lord Home of the Hirsel. If there is intervention it must not be identified by African nationalism as a kind of recrudescence of Western imperialism. If there is any intervention it must be universal and is best considered in the context of the United Nations.
Lord PAGET of NORTHAMPTON: My Lords, is not this a little unrealistic? It is Cuban troops who have conquered Angola and are at present sending for their wives and families, and there is nothing we can do about it. Can the noble Lord tell us something about the negotiations which I gather we are at present undertaking in order to provide Mozambique with money which will enable them to hire some Cubans of their own?
Lord GORONWY-ROBERTS: My Lords, in my pursuit of reality under the tutelage of my noble friend, I should require some little time to disentangle the implications of that question. He raises important matters, as always. The part of the question that relates to Mozambique I think he would do better to put down as a separate Question on aid to Mozambique. On the question of the Cuban presence in Angola, we have made it abundantly clear, and will constantly do so, that while the Cubans may be there by invitation of the Government of that country, so far there is no invitation for them to enter any other country. If they did, a new and very serious situation would be created.
Lord CARRINGTON: My Lords, is the noble Lord aware that those of us who think that double standards operate in these matters in the United Nations and in other international organisations also think that this does no credit to those organisations and makes it very difficult for those who wish to see them effective to be as enthusiastic as they should otherwise be?
Lord GORONWY-ROBERTS: My Lords, I am bound to agree with the noble Lord so far as any international organisations reflect double standards. He has in mind, of course, the possibility of the Secretary-General considering the facilities open to him under Article 99. I have no doubt that he is constantly

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looking at the powers he has under that Article. I have no doubt also that this Secretary-General as well as his predecessors is, as they were, bound to consider whether intervention by the United Nations would be successful in terms of its acceptance by the countries in Southern and Central Africa immediately concerned. Those countries are, of course, not all extremist; a number of them, very important countries in Africa, are moderate and constructive.
Lord HARMAR-NICHOLLS: My Lords, if the noble Lord is using the noble Lord, Lord Home of the Hirsel, as part of his shield, may I say that there was nothing in Lord Home's broadcast (if we listened to the same broadcast) which said anything other than that it was dangerous and unsatisfactory for Cuban troops to remain in Angola.
Lord GORONWY-ROBERTS: My Lords, I agree. I thought that it was a most constructive and satisfactory interview. I was particularly struck by the wisdom of his remarks about the need for careful thought when we consider intervention in Southern and Central Africa.
Lord SHINWELL: My Lords, is not Cuba a member of the United Nations; and, if so, is it not remarkable that the United Nations have not made any protest?
Lord GORONWY-ROBERTS: Certainly, my Lords. The United Nations, whether under the Article which enables the Security Council to move or whether under the Article to which the noble Lord and I referred in our recent exchange, must have regard to the acceptability of such an initiative among the countries immediately concerned. It is no good proceeding "cold" in these matters and finding that even a United Nations' initiative is faced by a quite sudden but real opposition from the Continent itself.
Baroness ELLES: My Lords, would the Minister agree that the last part of my question referred to the use of international machinery at the United Nations? Is it not rather remarkable that a unanimous resolution can be passed by the Security Council to give aid to Mozambique, but the British Representative
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is unable to table any resolution regarding Cuban troops?
Lord GORONWY-ROBERTS: No, it is not, my Lords. The United Nations must be understood to be an instrument of international action which still rests, rightly or wrongly, on a sufficiency of acceptability for what moves it decides on. I was asked just now whether there were double standards. Double standards arise when resolutions are moved and passed and some of them are not acceptable to all the Members of the United Nations. This is not so far, I regret to say, a world authority which can take initiatives with a strength that national authorities have. It must always feel its way and see how many of its own members will uphold it in its own decisions.
Lord SEGAL: My Lords, could my noble friend explain what is the special interest of Cuba in Angola, and why Cuban troops were sent there in the first place?
Lord GORONWY-ROBERTS: No, my Lords, I could not explain with any authority the intracacies of Cuban foreign policy. We have our own thoughts about this, and we have our own statements and actions to take. We have, since the fighting became obviously international, made it very clear on our own account, through the Community which joined us in this and through the Commonwealth, where we stand: that there is no justification for the intervention—certainly militarily—of any one country in the affairs of another anywhere in the world.
Lord CARRINGTON: My Lords, in answer to my noble friend the noble Lord came dangerously near, it seemed to me, to saying one should never raise anything in the United Nations unless it had a chance of success. Would he please deny that?
Lord GORONWY-ROBERTS: My Lords, I do not think the noble Lord should edit my remarks. I said that the United Nations was the only world authority we have; it is nevertheless imperfect—and I regret to say this—and therefore must proceed by resolution and action entirely on a sufficiency of support for those actions by its own members.

PRICE COMPARISON SCHEMES
3.16 p.m.
Lord ELTON: 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 has been the total cost to date of Government support of price comparison schemes as outlined in Circular No. 4/75 of the Department of Prices and Consumer Protection; and what steps, beyond giving the advice contained within that circular, they have taken to see that only like items are compared with each other.
Lord ORAM: My Lords, the Government grant commitment is up to £1,000 per annum for each approved scheme and so far 253 schemes have been approved. Payments of grant to date total £10,945. The Department of Prices and Consumer Protection maintains close contact with participating authorities and provides further advice and guidance where necessary. Once a survey is in operation, the weekly results are sent to the Department where they are carefully examined.
Lord ELTON: My Lords, while thanking the noble Lord for his reply, may I ask him this question? How is it that on a number of occasions we find shops in a town which stock two qualities of one line but others which stock only one quality? The more expensive quality in the first shop is compared with the cheaper quality in the others. Is the noble Lord aware that it is usually the small shopkeeper, with the specialist shop, who stocks a multiplicity of lines and again this militates against the survival of the small shop?
Lord ORAM: My Lords, the first point raised by the noble Lord is probably due to the treatment of branded goods, and their treatment is dealt with at considerable length in the circular to which the noble Lord's Question refers. Probably it arises because one shop has its own branded commodity whereas the other shop does not. On the question of the small shops, it is recognised that their service is a different type of service. They cannot in all cases compete in price; but they compete in other ways such as
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convenience and personal service. Therefore, to subject them to a strict price comparison would not be fair to them, or indeed to other traders. They are in a different line of business.
Lord ELTON: My Lords, is the noble Lord aware that I am referring specifically to comparisons of sugar—between a fine grade and an ordinary grade—with regard to which there is no question of branding? Would the noble Lord agree that his reply to my question implies that the elaborate pro forma replies issued in the circular to which he referred are not being used? Further, will the noble Lord tell us whether the review of the scheme promised for the end of last year in Clause 21 of the circular has yet been made, and, if so, what was the result of it?
Lord ORAM: My Lords, the advice in the circular is that the lowest prices in each case should be shown. It may be that in certain cases this has not been followed through. If the noble Lord has cases that he would care to let me see, then of course I shall have them examined. The review to which he referred is being undertaken. Of course, it is early days yet for this scheme, and the experience so far is now being assessed.

SOVIET FREIGHT CHARGES
3.20 p.m.
Baroness WARD of NORTH TYNESIDE: My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what countries have accepted a request from the United Kingdom to co-operate in making a joint representation to the Soviet Union on the subject of competitive cargo freight rates.
Lord WINTERBOTTOM: My Lords, the matter has not followed the course predicated by the noble Baroness. As I have indicated in earlier Answers to the noble Baroness, matters are being considered in various internatonal fora.
Baroness WARD of NORTH TYNESIDE: My Lords, I thank the noble Lord for that Answer. Presumably he has studied Soviet Shipping, which is a very

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interesting document. May I ask whether action is being taken on the suggestions made in Soviet Shipping, which is not issued by Soviet shipping but is about Soviet shipping? Also, can the noble Lord say what action as requested by the Chamber of Shipping is being taken, in view of the fact that if we are not very careful we shall have no British shipping left, and it is a very important invisible export?
Lord WINTERBOTTOM: My Lords, I have not had the pleasure of reading the publication mentioned by the noble Baroness. If she will send me a copy I shall read it with interest. What we are doing is discussing the problems that may arise with the OECD and the Consultative Shipping Group, which is made up of 12 European nations and Japan; and, of course, we have bilateral contacts, and such consultation will continue. As I have said before, our aim is to come to a common appraisal of the situation and then decide what may be required. A number of possibilities are being canvassed. Her Majesty's Government are not inactive, but I prefer not to be pressed beyond this point.
Lord DERWENT: My Lords, the noble Lord has repeatedly told us about these fora. Can he name them?
Lord WINTERBOTTOM: My Lords, I thought I had. The OECD is the Organisation for Economic Co-operation and Development, which is the commercial body covering Europe under the United Nations; and the Consultative Shipping Group is 12 European nations plus Japan.
Baroness WARD of NORTH TYNESIDE: My Lords, I thank the noble Lord for the help he is giving, of which I am sure everybody is very appreciative. If he has not seen Soviet Shipping, and if I send him the copy which was lent to me by one of the noble Lords on this side who is interested in shipping, may I have an undertaking that he will let me have it back again?
Lord WINTERBOTTOM: My Lords, I believe that book stealing is worse than horse stealing.

NHS: REGIONAL HEALTH AUTHORITY ESTIMATES
3.23 p.m.
Baroness WARD of NORTH TYNESIDE: My Lords, I beg leave to ask the second Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether the finance available to the Regional Health Authority housed in Newcastle-on-Tyne is less or more in 1976–77 than in 1975–76 and whether the Area Health Authorities covered by the region have yet received their estimates and which areas are requested to arrange for hospital closures.
Lord WELLS-PESTELL: My Lords, the overall financial allocations recently notified to the Northern Regional Health Authority are about 3 per cent. greater for 1976–77 than those for 1975–76. The Northern Regional Health Authority have not yet made their allocation to the Area Health Authorities in their region, but expect to do so shortly. Area Health Authorities have a general responsibility for considering the most suitable deployment of resources for the benefit of patients, including the use or continued use of particular health buildings. The Northern Regional Health Authority have not requested Area Health Authorities to make arrangements in connection with any closure.
Baroness WARD of NORTH TYNESIDE: My Lords, I thank the noble Lord very much indeed for the help which he has given. Is he aware that, as the estimates for the Northern Regional Health Authority have only recently been received and the other authorities have not yet received their estimates, it is very difficult for the Health Authorities in any part of the country to plan their future efficiently? Is it a fact that there is no money left in the Treasury for the Health Service?
Lord WELLS-PESTELL: My Lords, I do not think it is an unusual procedure, judging by the practice over a good many years. The Northern Regional Health Authority, along with all the other Regional Health Authorities, received notice of their allocation on 18th February, and the Northern Regional

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Health Authority are not meeting again until 23rd March, when they will decide what are to be the allocations to their Area Health Authorities. One must bear in mind that it takes a little time to work out how much money will be available nationally. Taking the Regional Health Authorities for the country as a whole we have been able to increase the allocation from £3,948 million to £4,052 million and, in the circumstances, bearing in mind the present situation, I should have thought that was quite reasonable.
Baroness WARD of NORTH TYNESIDE: Hear, hear!
Lord WALLACE of COSLANY: My Lords, is the noble Lord aware that any increase for the North, and other regions mentioned by the noble Baroness, is at the expense of the so-called over-bedded South-East where we shall have to face hospital closures?
Lord WELLS-PESTELL: My Lords, that is in some measure true, but I hope it will not be true from 1st April this year. We have put into operation a resource allocation working party, whose job will be to ascertain the real needs of each area. I accept that the Northern part of England has suffered rather considerably in comparison with the South. This has got to stop, and we are determined to stop it. That is why we have a resource allocation working party meeting at the moment. I should like to add that we are also introducing a new National Health Service planning system which will involve every hospital within a region, not just the Regional Health Authority and the Area Health Authority, so that they can make abundantly clear to their Regional Health Authority what their needs are. We regard certain areas in the North of England as deprived, and we intend to try to put a stop to that.
Baroness WARD of NORTH TYNESIDE: My Lords, I thank the noble Lord for all the information he has given, which is of great interest. But will he bear in mind, the regions having been extended under local government, that the Barrow-in-Furness hospitals are very badly equipped, and that more money is certainly needed to put them into better shape to look after patients?
Lord WELLS-PESTELL: My Lords, I would agree with the noble Baroness.
Lord ALPORT: My Lords, may I draw the attention of the noble Lord the Leader of the House, and of my noble friend Lord Carrington, to the fact that four Questions have taken 21 minutes? Is this not an inordinate time to spend on Questions which, in many cases, are of very small interest to the generality of Members of this House?
The LORD PRIVY SEAL (Lord Shepherd): My Lords, I think the records will show that on Thursdays, when the House tends to be better filled than at other times, 22 minutes is slightly better than average. I must say that, having taken 10 minutes on the first Question, we have not done too bady on the other three. Having replied to the noble Lord, I agree with him that we should watch with care the time we take on Questions. But I know that your Lordships attach great importance to Question and Answer, and I think that with a little forbearance and restraint we have not done too badly this afternoon.
Lord PANNELL: My Lords, will the noble Lord please consider referring to the proposed Select Committee the possibility, or perhaps I should say advisability, of having a chairman of this Assembly, rather than that there should still be an anarchist system to keep people in order, because those who have been in the other place know that it is one of the serious deficiencies of this place.
Lord SHEPHERD: My Lords, one of the benefits of having no Speaker in your Lordships' House is that those who are adept at the use of the point of order procedure do not have their opportunity here.
Lord PLATT: My Lords, if we do have something like a Speaker to this House, I suggest that one of his first duties should be to prevent continual and audible conversations taking place on the Bench immediately to my left.
Lord SHEPHERD: My Lords, like other noble Lords I tend to be led astray from our rules of order. I suggest that we now move to the next business.

PUBLIC LENDING RIGHT BILL [H.L.]
Lord STRABOLGI: My Lords, I beg to introduce a Bill to provide public lending right for authors, and for connected purposes. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read 1a.—(Lord Strabolgi.)
On Question, Bill read 1a, and to be printed.

HOUSING (AMENDMENT) (SCOTLAND) BILL
Brought from the Commons endorsed with the Certificate from the Speaker that the Bill is a Money Bill within the meaning of the Parliament Act 1911; read 1a, and to be printed.

CONSOLIDATION BILLS
The LORD CHANCELLOR (Lord Elwyn-Jones): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the Earl of Selkirk be appointed a member of the Joint Committee in the place of the Lord Kinnaird.—(The Lord Chancellor.)
On Question, Motion agreed to.

EDUCATION (SCOTLAND) BILL [H.L.]
Read 3a, an Amendment (privilege) made; Bill passed, and sent to the Commons.
INTERNATIONAL CARRIAGE OF PERISHABLE FOODSTUFFS BILL [H.L.]
Read 3a, an Amendment (privilege) made; Bill passed, and sent to the Commons.
WATER CHARGES BILL
Report received.

CROFTING REFORM (SCOTLAND) BILL
3.35 p.m.
The MINISTER of STATE, SCOTTISH OFFICE (Lord Kirkhill): My Lords, I beg to move that this Bill be now read a second time. This Bill introduces measures for the reform of crofting tenure which are long overdue. They stem from original recommendations made by the Crofters Commission as long ago as 1968 and 1969 and which have been the subject of considerable public discussion in Highland circles ever since. The previous Government introduced measures in another place in December 1973 but these were overtaken by the Election of March 1974.
The object of the Bill is to remove the constraints which prevent a crofter from developing his croft to its full potential, both agriculturally and non-agriculturally. During the past 90 years the crofting legislation has served the crofter well, but in some respects the very measures which were devised for his protection are now proving too restrictive. Though he has virtual security of tenure, a crofter does not own the land upon which he himself has erected his house and other buildings, and thus has no heritable title to his property. This prevents him from being in a position to realise the full market value of his buildings or from using them as security for a loan which he may require for some desirable development on his croft. His statutory entitlement is restricted to compensation for his improvements at their agricultural value should he give up his tenancy or be removed from his croft. Similarly, should the landlord resume any of the crofter's land for development or should an authority take possession of it in pursuance of a compulsory purchase order, the crofter's compensation is related to his losses in agricultural terms.
With the historical background of crofting and in the knowledge that his forebears have in many cases created crofts out of bare and inhospitable land, the crofter's feeling for his land goes far beyond that of an ordinary tenant and is more akin to that of an owner. The Bill recognises this in the three basic rights which are being conferred on the crofter. These are an incontestable right

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to acquire his house site and a reasonable amount of garden ground, a qualified right to acquire his inbye croft land at its crofting value and a right to share in the value of any of his land taken for development. The rights of purchase, however, are to be entirely optional; it will be for the crofter himself to decide whether he wishes to exercise them. If, however, he decides to remain as a tenant, he will now have the added benefit of being entitled to a share in the value of any land taken from him. The Bill also provides for the planning blight provisions to apply to crofters, thus giving further recognition to their interests as quasi owners, and contains measures for improving the management of common grazings. The important function of the control over the removal of land from crofting is to be transferred to the Crofters Commission.
One of the most important features of the Bill is the price formula for croft land. By means of this formula, which should put all crofters in the position of being able to buy their crofts if they so desire, the Government are providing that the price to the crofter will be based on the crofting value of his land. If, however, the crofter sells his land within five years of purchase he will become liable to pay a further sum to the landlord based on its market value. This will encourage those crofters who wish to buy and continue to work and develop their crofts, but should prove a disincentive to those whose only reason for purchase is to sell again for immediate gain. It would be unfair also to landlords to be under compulsion to sell, at a low price, land which was to be resold shortly afterwards at considerable profit to the purchaser.
I turn now to the Government's proposals for control over the removal of land from crofting. Our concern has been to devise a system which is sufficiently flexible to achieve a proper balance between the need to allow land to be released from crofting to facilitate development (which will in many cases benefit the crofting community) and to retain land in crofting where that is necessary to preserve the traditional crofting way of life. Under our proposals, the responsibility for this function is to be given to the Crofters Commission and we have provided guidelines for that body in the operation of the control.
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The responsibility for granting directions removing land from crofting control rests at present with the Secretary of State for Scotland. The Conservatives would have transferred this function to the Land Court but when we came to consider it we concluded that this was essentially an administrative rather than a judicial function. It was felt also that the responsibility should rest with someone closer in touch with crofting opinion than the Secretary of State for Scotland could possibly be. The natural choice, therefore, was the Crofters Commission. The Commission, with its field organisation, is probably better equipped than the Land Court to make a thorough investigation of the circumstances of a township as well as to deal with a possible significant increase in decrofting applications following the enactment of the Bill. I may say that the Commission is fully satisfied that the provisions will give them adequate control.
I should now like to give your Lordships some brief details about the clauses themselves. Clause 1 is the mainstay of the Bill and gives the crofter the right, failing agreement with his landlord, to apply to the Land Court for authority to purchase his house site or croft land. A cottar is given a similar right in respect of his house site. Clause 2 lays down the conditions under which the Land Court may authorise acquisition of croft land and Clause 3 provides the formulae for the calculation of the initial price of the land and any subsequent payment which may be necessary if resale takes place within five years. Clause 4 relates to the conditions and price under which the Land Court will authorise the acquisition of the house site. Clauses 5, 6, 7 and 8 contain various supplementary and consequential measures arising from the rights of purchase. Clauses 9 and 10 provide for the sharing of the value with the crofter where land is taken from his croft for development, and Clause 11 extends to crofters the protection from planning blight that applies to owners of property. Clause 12 extends the existing provisions relating to housing assistance for crofters to those crofters who purchase their house sites. This assistance, which is not available under existing legislation to owner-occupiers, will apply for a period of seven years after purchase. Clause 13 covers the control procedures which I dealt with earlier in

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some detail. Clauses 14, 15 and 16 amend the law relating to common grazings and assignations and Clause 17 makes certain changes in the procedures of the Land Court. Clause 18 provides for the payment of pensions to members of the Crofters Commission and the remaining clauses make provision in the usual form for Crown application, financial provision, and so on.
The Bill was very fully discussed in another place and the reports of the debates help to clarify what is necessarily a highly technical subject involving complex legal issues. The changes we have made as a consequence of these debates will, I hope, have made it easier for this House, and of course the people whose lives it will affect, to understand its provisions. My Lords, I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read 2a.—(Lord kirkhill.)
3.42 p.m.
Lord CAMPBELL of CROY: My Lords, I should like first to thank the Minister, the noble Lord, Lord Kirkhill, for having explained so concisely and clearly the background to this Bill. I have a certain advantage over other noble Lords in this House, in that I have already taken part in a Second Reading debate upon this Bill. As some noble Lords from Scotland may know, on that occasion it was I who started the debate, because I introduced an almost identical Bill in another place in a debate shortly before the General Election of February 1974. I should warn the Front Bench opposite that there is a phenomenon which I have observed: whenever a crofting Bill appears a General Election seems to be not far behind. Much as I should like to see a change of Government, I hope we can get this Bill through first on this occasion. That last version of the Bill expired as uncompleted legislation in 1974. The present Government, with their own priorities, have not found time to introduce the Bill before now, but from this Bench we welcome the fact that they have introduced it in this Session.
The crofting system and the associated law are restricted to a defined area of the Highlands and Islands. I am sure noble Lords will expect me, as well as
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the noble Lord, Lord Kirkhill, to explain some of the background to the Bill, having myself been responsible for it. I regard the Bill as of considerable importance—although restricted in area—because it contains a generally agreed scheme for modernising the whole system and providing crofters with new options, including the option of becoming an owner-occupier and, with safeguards, choosing to leave the crofting system should they wish to do so. The general agreement reached was as a result of many meetings and consultations. Those that were held from 1970 until the introduction of the first version of the Bill at the end of 1973 were carried out, I can tell your Lordships, as a continuous operation. I had several meetings with the Crofters Commission and with the chairman, Mr. Shaw Grant, and the Commission in turn had many discussions with the representatives of crofters in different parts of the crofting counties. Much of the credit for the Bill should go to the Crofters Commission for the work which it did during that period.
The Crofters Commission took the first initiative, because in 1968 it published proposals which demonstrated the need to make a dramatic change in the whole system, and also the way in which this might be carried out. Its suggestion was a change to owner occupation for all crofters, but it also suggested that it should be compulsory that on a certain date every crofter should become an owner-occupier. We found that some crofters would like the option but did not necessarily want to change their existing status. Some of them were definitely against being compelled to become owner-occupiers. Therefore, before arriving in office in 1970 my colleagues and I had worked out a possible adaptation of the Commission's scheme and a scheme whereby owner occupation would be a free choice. That was the basis of the scheme eventually agreed, together with other provisions. The right to purchase the house and garden ground was one of the other provisions; another was the right to acquire inbye land for non-agricultural development, and the third was giving the crofter a share in the development value of the land on his croft.
These agreed proposals were published by me on 4th August 1972 in the form of a long Parliamentary Written Answer

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in another place. I suggest to anyone, who has not already obtained copies and who wishes to see the background to this Bill, that that Parliamentary Answer, which is easily available, sets out the origin and the principal purposes of this Bill. There was a criticism at the time that the statement should have been made by way of a White Paper and not a Written Answer, but I did not think it necessary or appropriate for a very abstruse subject—which this is, and which, although important, affects only a part of Scotland—to be dealt with in a White Paper. That view appears to have been vindicated, because the present Government have followed the same course; that is, they first indicated by Written Answer what they proposed to do before producing this Bill.
Changes in the crofting system are needed because desirable development for non-agricultural purposes was and is still, discouraged by the way the system operates. In particular, projects connected with tourism, projects connected with services to the new communities which have been growing as a result of developments related to North Sea oil and other developments, have been deterred because of the procedures of the crofting system. The crofter is unlikely to benefit from his own enterprise and effort under the existing system. That was one of the chief reasons for the provisions in this Bill.
The two alterations of any significance which constitute the difference between this version of the Bill and the first version introduced by me, are these: first, a price formula has been included in Clause 3. No doubt we shall examine that in detail in Committee. At this stage, I would tell your Lordships that I see no reason to advise you to dissent from this formula. It is related to 15 years' current rent. but the rent can he up-dated by the Land Court. This is important, because where a landowner has not raised rents for many years, a benevolent landowner who has kept down his rents might have been penalised if the last 15 years' actual rent were taken as the basis for a payment. Therefore, I am glad to see that he can apply to the Land Court in order to get an updated market rent considered, and would not be penalised for keeping rents low.
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My Lords, the second change was that, where land is being considered for removal from crofting control in Clause 13, the Crofters Commission is to be responsible for the decision and not the Secretary of State or the Land Court. There is an appeal to the Land Court which I think is important. This therefore gives to the Crofters Commission a form of planning permission power. Again, I see no objection to this, and trust that the Crofters Commission will use that power with care and wisdom.
It is interesting to compare the speech made by the present Secretary of State, the right honourable gentleman Mr. William Ross, on 16th December 1975 on the Second Reading of the Bill in another place, with my speech of the 22nd January 1974, in particular when we gave our descriptions of the clauses towards the end of our speeches. They are very similar, identical in places. I am not sure that the Scottish Office may not have used the same brief with some slight variations. I described Clause 1 as a "cornerstone"; the Secretary of State described it as the "mainstay". Again today, I noticed that the noble Lord, Lord Kirkhill, used the word "mainstay", and did not use a further version.
When the right honourable gentleman Mr. William Ross was summing up, he said:
"The Bill introduces a new era in crofting and offers the crofter a new freedom".
I said in my summing-up:
"It is a valuable and wide-ranging reform, and a charter for crofting freedom."
I cannot do otherwise than commend this Bill to the House, having myself been more responsible than anyone, I suppose, for originating it. But there is some irony to be found in the comments made by some others in the Second Reading debate in another place in 1974. For example, the present Parliamentary Secretary to the Ministry of Agriculture, then an Opposition Front Bench spokesman, in that debate said:
"To us the Bill represents a travesty of justice",
and,
"What is so outrageous is that it is a prescription for the decay of the crofting communities".
The present Parliamentary Under-Secretary for the Department of Prices and

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Consumer Protection condemned the Bill as
"a measure which virtually destroys the crofting system and the security of tenure of crofting communities".
I should like to ask the noble Lord, Lord Kirkhill, whether the Secretary of State for Scotland has received representations from these two junior Ministers, Dr. Strang and Mr. Maclennan, expressing the same feelings towards the Bill? Have they offered their resignations if the Bill is not withdrawn?—because no one can pretend that the small changes I referred to could possibly have altered the Bill to make it cease to be a "travesty of justice", or a "prescription for the decay" or the virtual destruction of the crofting system if it were so characterised in its earlier version. Have the two junior Ministers changed their minds? Or were those hysterically exaggerated words uttered in order to cause alarm among crofters, or to attract the attention of the Scottish Press? If these statements were put forward for either of the second two purposes I have mentioned, then I think that that was thoroughly irresponsible.
After the announcement in August 1972, I made clear that the way was open for volunary transactions and agreements, on the basis proposed, to proceed forthwith without having to wait for legislation to be passed. If transactions were entered into willingly by landowners and crofters, then the benefits could immediately be gained—for example, going ahead with a non-agricultural development, and those concerned would know that those transactions were in conformity with what would later be prescribed by legislation. I am glad to say that a number of transactions took place, which set a satisfactory pattern of agreement and prices. They demonstrated that the procedure could work voluntarily before the legislation had even come into effect.
The Secretary of State for Scotland is the owner of a large number of crofts. In 1972, when that statement of mine was made, he was the owner of about 2,000 crofts; that is, one-eighth of all the crofts. The Secretary of State for Scotland, incidentally, is the largest landowner in the United Kingdom—I do not know whether your Lordships realise that—and the croft ownership is a large part of it. In the same way, as Secretary of State,
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I started the process of enabling crofters who were tenants of the Secretary of State to become owner-occupiers if they wished. I am glad to tell your Lordships that according to my information, about 100 crofters did decide to become owner-occupiers, and so their land left the ownership of the Secretary of State for Scotland. That was a result of the initiative which I took at that time. I understand that the present Secretary of State is now adopting the same attitude, and allowing his crofters, if they wish, to opt for owner-occupation, whatever this Bill brings into effect. But I shall be glad of any comments on that matter that the noble Lord, Lord Kirkhill, may care to make at the end of the debate.
The Secretary of State in this Government has had difficulties with the Left Wing of his Party, because one-eight of the crofts—I do not know precisely the area of land which is owned by the Secretary of State—could be regarded as nationalised land, and allowing this land to move into a state of owner-occupation appeared to be going in the opposite direction to nationalisation. I recognise that the Secretary of State for Scotland has had to deal with criticism from his own Party because nationalised land appeared to be being denationalised under this scheme.
My Lords, before I sit down, I should like to put two points to the noble Lord, Lord Kirkhill, to see whether he can reply to them today, or at a later stage of the Bill. The first point concerns the housing assistance offered in the Bill. The provision is that there will be continuing housing assistance for crofters for a period of seven years after they have become owner-occupiers. Among some of those concerned with crofting, the opinion has been expressed that this provision might be more flexible, and that in certain circumstances and in certain cases the housing assistance might appropriately be continued beyond seven years. I do not know whether the Minister can tell us anything about this today.
My second point concerns the question of eligibility to be treated as a crofter. It has been generally understood that the units to be treated under the crofting laws are those registered with the Crofters Commission or with the Department, as such. Does the noble Lord

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the Minister think there is likely to be any dispute in the future as to what constitutes a croft within the Acts? One aspect of this is, of course, the changes in local government boundaries that have taken place. Previously, the crofting system applied only in the seven crofting counties. With the new boundaries, that area has been somewhat extended. But my understanding is that the crofting system is still limited to the present boundaries. Can the noble Lord the Minister also tell us whether he thinks there will be any difficulty in deciding the nature of a unit or an estate which would qualify to be treated as a croft under this Bill?
My Lords, I should like to end by congratulating the right honourable gentleman, Mr. William Ross, if it does not embarrass him for me to do so. He and I opposed each other in a Parliamentary and, therefore, an amicable way, over a period of many years at Dispatch Boxes in another place. I recognise his difficulties with those in his Party and elsewhere who opposed these proposals when they were first put forward. They have been opposed for various reasons. I think Mr. Ross should be applauded for reintroducing these proposals despite that opposition. If he had not done so, the results of a great deal of work would have been lost. Furthermore, the period when there was general agreement on these proposals, as there now is, would have passed and any future attempt to reform the crofting system would have meant starting again from the beginning. Your Lordships will therefore understand why, subject to any minor changes that may be made at a later stage, I think your Lordships' House should support this Bill.
4.1 p.m.
Viscount THURSO: My Lords, I find it charming to see the broad and happy measure of agreement between Her Majesty's Government and Her Majesty's Opposition over the matter of the Crofting Reform (Scotland) Bill. The only areas of disagreement that they have so far been able to find are the choice of the mot juste wherewith to applaud the individual clauses of the Bill. I must confess that I have to add my happy felicitations on the fact that this Bill is finally coming before your Lordships' House. In fact I would go further than
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either the noble Lord, Lord Kirkhill, who has introduced this Bill to us, or the noble Lord, Lord Campbell of Croy, who has so ably, one might say, seconded it, by supporting the Crofters Commission itself and saying that really the whole system of crofting is an anachronism; it is a purely feudal system of tenure very long overdue to be brought into the 20th century.
One or two points worry me. The noble Lord, Lord Kirkhill, for instance, said that he thought it might be necessary to preserve the traditional crofting way of life. I do not honestly think that you will ever preserve the so-called traditional crofting way of life. This is being changed for us at Kishorn and at Nigg and we are not going to see people living a peasant form of existence trying to scratch a living out of a small open boat combined with a few rough acres of ground. I think that in superseding the system of crofting tenure it must be the objective of Government and administration to see that we substitute for the old crofting form of tenure a good form of agricultural structure where the smaller farm is able to form part of the farming ladder and is able to contribute to the agricultural life and the agricultural industry of the country, at the same time preserving the only thing that really matters to the crofter, his home. This is what this Bill does, and that is why I support it. It gives the crofter the right to acquire his home irrevocably and without fear of legal peradventure, and in such a way that he can borrow upon it and develop it and use it as any other people use their home or their property.
One or two points were raised in another place during the debate of the First Scottish Standing Committee on this Bill, which I think we should still bear in mind, particularly those raised by my right honourable friend Mr. Grimond. The first of these points is the importance, in any decisions which are made by the Crofters Commission or the Land Court, of the welfare of the community being considered. The welfare of the community and the maintenance of the traditional crofting way of life are two different things altogether. It may very well be that there are considerations which relate to the welfare of the community which do not in fact preserve the traditional crofting way of life, and the

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preservation of the traditional crofting way of life is not necessarily to the welfare of the community. I think that it is perhaps a pity that we have not seen more emphasis upon the importance of the welfare of the community, perhaps through the Amendment which my right honourable friend moved in another place:
"that the making of such an order would be detrimental to the future of the crofting community affected by it,"
as an inhibition on the making of an order under Clause 2.
Among the other points which he raised was the question of the right of access to the foreshore. This is particularly a point which relates to some of the crofts in the islands and round the shore. It obviously does not relate to a croft inland. It was perhaps unkindly dealt with in the Scottish Standing Committee. We must see that we are satisfied, as this Bill passes through your Lordships' House, that in fact the rights of access for crofters who have rights of access to the foreshore are properly maintained.
Another point which was raised was the question of objection on behalf of others. This is an important point. In law you cannot raise objections to certain things unless you have a locus in the matter, and very often it is necessary for (shall we say?) the community to ask a landlord to object to something happening so that an inquiry can take place. I have been placed in this kind of position myself on more than one occasion by local authorities, where I have had a legal locus in a matter. I have been approached to give a ruling from the point of view of my locus in order to get the whole matter clarified. The suggestion that it might he possible for somebody to make an objection on behalf of others is not a bad suggestion to bear in mind as the Bill passes through your Lordships' House.
Finally, on the suggestions and Amendments which were put by my right honourable friend in another place, one Amendment I feel it was a pity not to have accepted read as follows:
"In all cases involving a change of use for land designated as croft land before the passing of this Act, whether by a landlord, crofter, owner or tenant, there should be a right of
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appeal to the Land Court by any interested body. The Land Court if it considers that the change will be detrimental to the long-term social and economic interests of the district shall have power to overrule any decision by the local planning authority."
This was really a drawing together of all the points I have just mentioned, putting the matter into the hands of the Land Court to deal with. I share this faith in the operation of the Land Court. I share the regard for the way in which the Land Court deals with matters affecting tenure of all kinds, and I would have faith if matters of decision were placed in its hands. I think it is a pity that this Amendment was not accepted and did not eventually form part of the Bill. Nevertheless, having said these things, in general I must welcome this Bill and wish it a fair passage unhindered, as was suggested, by the threat of General Elections or any other such disasters. We, on these Benches, will certainly hope to give it a fair wind and see it gets safely on to the Statute Book.
4.10 p.m.
Lord BALFOUR of INCHRYE: My Lords, at the outset of my few remarks I must declare an interest, having no less than 105 crofts on a property in Sutherland, so your Lordships will appreciate that I have some small knowledge of the crofter and his life. I think that this is a good and a fair Bill. By the time my noble friend Lord Campbell of Croy and the noble Lord, Lord Kirkhill, had spoken, I was not sure to whom one should give the credit for this Bill being good and fair. It struck me that we were getting something like a Party workers' co-operative between the two sides who finally have produced this satisfactory Bill.
I take issue with the noble Viscount, Lord Thurso, who rather deprecated the way of life of the crofter. Crofting is undoubtedly a way of life, and the crofters are proud of that. On my property we have broadly two classes of crofter: the crofter who can just make a living—and a not unreasonable one—and the crofter who is a part-time crofter. Four postmen in my area of East Sutherland are crofters; my gardener is a crofter and the railwaymen are crofters. That is all to the good. They contribute to the countryside, they contribute to their own and their family's earnings; and

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when people condemn crofting I think of the depleted Highlands population. In Sutherland some years ago, we had some 16,000 people. I think the last figure I saw was between 11,000 and 12,000—a pathetically small number—and if we did not have the crofting, supported as it is in various forms by Government grants, population depletion of the Highlands would be even more severe.
A crofter gets Government aid for his cattle, his sheep, his fencing, his land drainage and his general improvements, and it is easy for critics to say that the crofter lives on subsidies. He has that measure of support, but I should far prefer to see the continuation of that support at the expense of the general taxpayers rather than see the land go out of crofts. The social problem, as I see it, is what to do with the young people. I hope this Bill will assist the crofting industry, the crofting occupation, to a degree which will give some encouragement to the young people not to leave, as I am afraid they are rather tempted to do at the present time.
I have only three points to make on the Bill, and I shall make them briefly. The first is really a Committee point, but if the Minister can wipe it away in a sentence it will shorten proceedings later on. The Bill's proposals will entail a lot of conveyancing following applications by crofters to the Land Court, but there is nothing in the Bill to say who is to bear the legal costs of that conveyancing. I do not think that the landlord should have to bear those costs. The second point concerns Clause 2(3). There is given to the landlord the right to have a lease of sporting rights for shooting and fishing on land which is taken over by a crofter. Shooting and fishing are great fun, but they are not just fun. For a landlord they are a way of earning revenue for his estate which helps to enable him to keep it in good order and run it properly. I should like the Government to tell me whether they would agree that the lease should be a long-term lease, because this clause virtually takes away one of the earning assets of a landlord. Therefore, it is only right that the landlord should have security by way of revenue from the assets of which he is being deprived.
My third point concerns Clause 3 subsections (1) and (2). My noble friend
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Lord Campbell of Croy spoke about the 15 years' purchase. The Government have thrown a lifebelt to landlords who have tried to do their best by their crofters. I know one property where the rents have not been raised for many years: most of them were fixed in 1888. Perhaps they have not been raised because the landlord has some sympathy with the crofters' difficulties and struggles, but I would disagree with the noble Viscount, Lord Thurso, when he paints a picture of crofters living a sort of peasant life. He has built up the picture of a hovel, and of digging in rather barren ground. I am delighted to say that on most of the crofts on my property can be seen televison masts and motor cars. Whether that is because of Government help or whether it is entirely due to their industry I do not know, but it delights me to see them. I disagree profoundly with the noble Viscount, Lord Thurso, in his criticism of the standards of life and the prospects of crofters. One of these points can be dealt with in Committee, and no doubt the Minister will be able to reassure me on the question of the lease for sporting rights. Apart from these three points, I think that the Bill is a good one. As an owner of crofts, I welcome it and think that it is fair to both landlord and crofter.
4.17 p.m.
The Earl of CROMARTIE: My Lords, I too have to declare an interest in this matter, as apart from coming from one of the main crofter counties I have a number of good crofts and good friends on what remains of the Cromartie Estate. Recently I read a letter in the West Highland Free Press suggesting that no crofters had been consulted about the Bill, but so far as Ross and Cromarty was concerned this was quite untrue as when, during the good old days of the county council the prospect of crofting reform arose, the first thing that my county council and I did was to convene a meeting of mainland crofters as well as representatives from the Island of Lewis who, in those days, were part of our county.
This Bill varies but little from the original one, and I may say here and now that I am in favour of it, although there may be a few queries in my mind. In my very early youth I was at school with crofters and I have lived in close and happy proximity with them for most

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of my life both at my own home and on the West Coast when we still owned property on that side of the county. I might also add that I have served with them in both peace and war. As many of your Lordships may be aware, there is a considerable difference between the primarily arable crofts in the Eastern area to the crofts on the West Coast where the arable land is so often minimal, and they depend on a large and good common grazing for stock, especially where they do not combine fishing with agricultural work. Here I should perhaps commiserate with my kinsman, the noble Viscount, Lord Thurso; if his crofting land is so bad in Caithness, I could show him some very good land in Ross and Cromarty.
I do not intend to go back in history to the terrible conditions under which, in certain areas, crofters suffered. We all know what happened, which was quite inexcusable, even though one realises that much emotive exaggeration has been recorded, usually by people who know nothing whatever about Lice Highlands or the Highlanders or about their history. In my view, when the Highlands are having to take an influx of people from an entirely different environment and with little in common with the Highlanders, it is of vital importance that every effort should be made to maintain and improve the position of the crofting communities, both from the point of view of agriculture and for the maintenance of a valuable heritage.
I have spoken to many crofters about the Bill and I think that it is acceptable to them. The only fear I have is that as the Bill stands it could open the door to the developer and we could find, especially in places of scenic beauty, high-rise flats or some such horror sprouting up on crofting land, no doubt financed by people from outwith the British Isles. Perhaps the Minister will consider this point and make sure that the Crofters Commission and or the Land Court has not only the power but the duty to prevent anything like this from happening. For those of us who live and work in the Highlands, like the crofters themselves whose forbears have been in these areas from time immemorial, this is a very important point but it might be less so for
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the many absentee landlords who have, for the past half century or more, taken over so much of the country.
There are a few small points I wish to put to the Minister. First, with the appalling cost of imported fertilisers it might well happen that we shall have to go back to using our own resources, and one of the most important substances is seaweed. Any croft situated by the seashore should have the exclusive right to seaweed lying adjacent to the croft. Secondly, some have said that the rather indefinite title to the croft would make it difficult for a crofter to borrow from a bank or anywhere else for such improvements as he might wish to make if he wished to buy his croft. Thirdly, there has been criticism of the sporting rights being left with the landlord, but he also, I hope, has a right to live, and in many cases the loss of these rights might seriously interfere with his ability to let his shootings, and perhaps an even more valid reason is that if the adjacent crofts have the sporting rights it would not be long before there was nothing left for anybody to shoot. This, of course, does not imply that raiding deer should be allowed to come in and cause damage. I wish this Bill well and hope that it will be of advantage to the crofting community as a whole who make up such an important feature of our Highlands of Scotland.
4.24 p.m.
Lord BALERNO: My Lords, this long delayed but much required Bill has had a chequered career, but perhaps the delay has done no harm; it has given time for it to be well polished up and brought up to date and the improvements that have been added to it have been substantial and welcome. Especially welcome is the recognition of the great variety of conditions between the various crofting areas and consequently a very flexible approach, much more flexible than had originally been envisaged, has been adopted in the Bill, which makes it extremely sensible and realistic.
My noble friend Lord Campbell of Croy has covered the ground very fully and I have little to add to his lucid and comprehensive statement; but there is one question I wish to ask in regard to common grazings. It appears to me that

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the existing common grazing committees are in fact, though not in name, cooperative societies. I wonder, therefore, whether it would be possible to treat them as such for the purpose of grants under the EEC Common Agricultural Policy. Although the conversion of crofts to owner-occupation cannot be regarded as quite the final solution of the crofting problem, it goes a very long way towards it. Perhaps, therefore, we can envisage the phasing out of the Crofters Commission with its remaining responsibilities being taken over by the Scottish Land Court. The noble Viscount, Lord Thurso, has spoken of the good work that this Court has done. It was established in 1912 and has, despite certain vicissitudes, won the confidence of the Highland and agricultural communities. Under its present chairman, Lord Birsay, one could almost add that it has also won their affection.
I can remember at the turn of the century when in certain parts of the Highlands and Islands the "Black House" was the rule rather than the exception. The houses of which we are speaking today, however, are their successors and it is opportune to speak about the good work done by those civil servants responsible for administering the various land, housing, livestock and other agricultural grants down the years. Especially we should on this occasion remember the late Sir Robert Grey, who presided over the old Board of Agriculture and then was Permanent Secretary to the Department of Agriculture. He was in that position for over 15 years and was served by some men of remarkable ability and very great humanity. It was due to those men at all levels of the Service that the worst of the distresses of the last century were overcome. Their work and that of the Crofters Commission has paved the way for this Bill. It is only right, therefore, that we should pay tribute to those men. Most of them were Lowlanders who, by a combination of humanity and a considerable amount of good humour, greatly improved the conditions of life in the crofting communities.
4.28 p.m.
Lord BURTON: My Lords, I must declare an interest, for I am still the landlord of about a dozen crofts, though I used to own far more, and I have been involved in the management of a large number of crofts for 25 years. I think
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that I am, therefore, one of the few people in either House who has had extensive practical experience in trying to manage crofts. There are many misconceptions about crofting and I suspect that few of your Lordships have been either crofters or crofting landowners and have had to grapple with the crofting problem. There arc, of course, one or two notable exceptions—the noble Lord, Lord Balfour of Inchrye, with 100 crofts; the noble Earl, Lord Cromartie, and others—and to a large extent the same applies in the other House. However, on reading through their discussions one cannot but realise that few have had an appreciation of the complexities and unsatisfactory nature of this form of tenure.
This experience compels me to introduce a note of discord into your Lordships' debate. Confusion is multiplied by the fact that there are so many different types of croft and crofter in such widely different localities. A croft may be as small as one acre or less, and I know of one of 4,500 acres. The fact remains that there are just over 14,000 crofters. Along with their families, they number probably 30,000 to 50,000 people. The various political Parties vie for their votes, totally disregarding good land management or the handful of landowners involved. Further confusion is added by Ministers of all Parties receiving a totally one-sided account of matters from the Crofters Commission. It is the belief that all or most crofters or their ancestors have carved out their croft from the barren hill. The number of crofters in that position is steadily decreasing and they must now be in a considerable minority. The Commission has become the State-paid representative of the crofters instead of fulfilling its functions as laid down in Section 2 of the 1955 Act.
I have no doubt that the Minister will disagree with me, but I speak from practical experience. Take the instance of absentee crofters. How often has the Commission taken any action on Section 17 of the 1955 Act? Act after Act has been enacted, one altering the other, making crofting legislation probably the most complicated form of land tenure in the world. Now, on top of an already over-complicated situation, it is proposed to pass a further muddling Act. I feel that I should hasten to dispel the belief that crofting is merely a form of agricultural tenure. Frequently, virtually no

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agriculture at all is involved. I recently had a cottage, which happened to have a big enough garden, made into a croft by an astute lawyer acting for a tenant. I hesitate to publicise the fact as I believe that a great many more crofts could be created to the detriment of all except possibly the occupier.
The crofter has been painted as the poor, struggling occupier of ground, whereas in fact he is the most subsidised and fortunate individual in the country. The Conservative Government in 1955 made a great mistake in permitting any piece of ground of rental value under £50 or under 50 acres to be registered as croft ground, provided it was within the seven crofting counties. This brought a considerable amount of extra ground into crofting—a form of tenure which, it should have been clear to everyone, was a bad one. Since then, the situation has been aggravated by improved communications and changed social structures, with the result that certain crofters—very often those who came in newly under the 1955 Act—have been put in a quite unreasonably privileged position. For instance, why should crofters just outside Inverness or Dingwall, a great many of whom sublet their ground and at least one of whom I know lets his croft house as well, be given enormous privileges over their neighbours? They get special rating alleviation on their houses; they pay tiny rents; and in many cases they sublet their holdings to neighbouring farmers for rents of five or more times what they are paying to the landlord. In addition, they receive grants and subsidies which are not available to other sections of the community. I therefore ask the Government to consider an Amendment to the Bill which would prevent any more land being brought into crofting tenure. I do not know whether this has been considered in any way, but I believe that it should be given serious study.
Having lodged this criticism, I must say that there is a great deal of justification for subsidising the Islands and possibly some of the remoter areas of the West coast. But make no mistake, crofting is not an agricultural matter: it is a social matter. Where there is a social need, it is fair enough for something to be done about it. But, in the East coast areas, there is no reason why a small section
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of the community should be specially pampered at the expense of others. There is no reason why one householder should pay a fraction of the rates which his neighbour pays for his house. There is no reason why someone owning one piece of ground should receive grants and subsidies which are denied to his neighbour who owns another piece of ground. Indeed, there is no reason why someone on the Inverness-shire side of the boundary should get grants and subsidies which are denied to those in like circumstances in the counties of Moray and Nairn. The time has come—indeed is well past—when the crofting boundaries should certainly be moved West and probably North as well. There is no reason why a crofter who, through amalgamations implemented since 1955, is now working over 100 acres of arable, should receive crofting grants, and no reason why a crofter with 4,000 acres of hill land should receive these special privileges.
I would ask the Government to look very carefully at this situation to see whether they consider these injustices should be allowed to continue. As I stated before, there are special social reasons for subsidising Island communities. There, it is very different from crofting in Easter Ross, the Black Isle and the Inverness area. Though crofting tenure covers almost 45 per cent. of the land area of the crofting counties and a much higher proportion of the coastal areas, two-thirds of the total number of crofts are in the Islands and a great many more are in the West coastal areas. The Secretary of State owns 1,850 crofts and the Stornaway Trust owns 1,350. Those two landowners between them therefore own one-sixth of all the crofts in Scotland.
The Minister will no doubt tell us what an enormous agricultural production is derived from the crofting areas. However, he does not realise that this production is only a fraction of the capability of this land. Of over 18,000 crofts, only 2,000 drew production grants in 1974. I understand that that figure dropped to 1,500 in 1975, though there are of course about 4,000 who have been drawing livestock headage grants. Thus, only 5,500 crofts out of 18,000 claimed grants. That shows what an enormous number of occupiers are not really working their crofts. There is some doubt as to whether all those drawing production grants ever harvest

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their crops but, even so, your Lordships will see that only about one-third claim grants.
The Crofters Commission which, after all, does not produce a single cow, a single sheep or a single grain of corn, but which is purely an administrative machine, costs the country nearly a quarter of a million pounds a year. Remember that a largely similar production came out of the Highlands prior to 1955, when the Crofters Commission came into being. I strongly submit that we are not getting value for that quarter of a million pounds a year.
On top of this bureaucratic machine, there is the Department of Agriculture administering both grants and the Secretary of State's crofts. In addition, various estate staff administer the other crofts, so that there is a huge further unqualified annual expenditure on administration. The total rent accruing to the Secretary of State for his 1,850 crofts is £50,000, which gives an average rental for the Secretary of State's crofts of approximately £27 per croft—perhaps £2 or £3 per acre of arable, and less for the hill. Rentals probably fall well below the cost of administration.
Where land can be taken out of crofting tenure without creating social hardship this should be done, therefore. However, successive Governments have made this harder and harder. I am pleased to say that on the estates which are being administered by me well over half the crofts and crofting land have come out of crofting since 1955, without, I hope, any social upsets. Most of this ground is now very much better worked in more economic units and in most cases by ordinary agricultural tenants. The Bill will only make the situation more complicated and will make the estate units more uneconomical and merely give preferential treatment to a selected few.
On Monday night, I attended a local branch meeting of the NFU. It was a very well attended meeting and—quite unsolicited by me, I may say—a resolution was unanimously passed that this was a most unfair Bill and asking union headquarters why no action had been taken about it. The members could not understand why one private individual should be allowed compulsorily to acquire land at any time which suited him, from
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another private individual. They said that it was a totally different matter when the public required a piece of ground, and that compulsory acquisition was a public matter. They could not understand why a private individual should be allowed to do it. The Conservative Government thought that it made a nice political gimmick to talk about a "property-owning democracy" and the Labour Government merely do it, it appears to me, to injure the landowner. In the process, they cause damage to good land use and agricultural production and, consequent upon that, there is a reduction in rateable values.
Landowners will have their sporting rights—fishing or shooting—compulsorily taken from them and the extraordinary situation will be that the crofters will be able to lease back the rights which they have been able to take compulsorily. Take as an example trout fishing which, at present, is not a separate heritable right but goes with the riparian owner of the land. The result is that, regardless of whether there are any brown trout in the stretch of water which may well be a good sea trout or salmon river, if the Bill goes through in its present form the crofter will receive the right of fishing, ostensibly for trout, in the waters in question. It may well be that he will set up a caravan park in the area and that the salmon fishery owner will then find a whole queue of people spinning in his river and be powerless to do anything about it. Bear in mind that he will be powerless to stop the sale of that piece of ground. The Bill really runs in contradiction to another Government Bill which is at present before us—that is, the Freshwater and Salmon Fisheries Bill.
Mention has been made of marauding deer, and I should like to emphasise that nothing in the transfer of shooting rights will make any difference to the question of marauding deer. Under the 1959 Act the crofter has the right to kill marauding deer at the present time and nothing in this Bill will change that. Sport is an attraction for tourists and provides employment, often among the crofters themselves. It produces rates, too. To destroy this, one of the too few assets in the Highlands, seems to be madness.
Much of the Bill is a shamefully bad piece of legislation. If we cannot reject it altogether, certainly on the fishing

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aspect, and on a few other matters, we ought so to amend it that at least it would do less harm than it would as at present worded. The Bill might not be so bad if both the landlord and the crofter got equal justice from the Land Court, but this body is so biased that it is really an anachronism to call it a "court". Successive Labour Governments have packed this court with people of their persuasion over the years, so that the landlord has little hope of justice from them. Look, my Lords, at the ridiculously low rents awarded by the Land Court which has kept down the whole level of croft rents, and indeed of agricultural rents in the whole of the Highlands.
The Conservatives have congratulated the Government on adopting their Bill. But there have been major changes in taxation in the past two years. The Bill is now a big "con" trick on crofters. If one takes into account capital gains tax, capital transfer tax and—I am not sure about this, but probably development tax as well, any occupier of ground is almost certain to be in a better position as a tenant than as landlord. We have never been told the value the district valuer will place on crofting ground for taxation purposes. I suspect that it will not be 15 years purchase of the rent, in which case it means that on every transfer the crofter will have to pay a considerable amount of tax. Having said that, I must say that there are absolutely no objections to the proposals for house and garden to be taken over by the crofter, nor for the sharing in development. But the remainder of the Bill needs much careful surveillance.
The Minister in another place referred to the crofters' suspicion of the man from St. Andrew's House, so perhaps I can end on a lighter vein with a short account of an experience of mine. I happened to be out in the islands on county council work, when the weather become too stormy to cross from one island to another. So I thought I would go down to the harbour and see a crofter fisherman and find out what effects the rocket range was having on the lobster fishing.
On the pier I came across a chap who looked like a lobster fisherman and asked whether he could help me on this matter. He said that I had better talk to the skipper. So he duly shouted
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down into the bowels of a small boat, "Donald". A red beret appeared from beneath. The wearer of the beret came up and talked to me, but he was very cagey, giving "yes" and "no" answers. Eventually he said: "By the way, who are you?" I explained who I was, and said that I was there for the county council. He replied: "Och, thats' all right, then. I thought you might be from the income tax."
4.44 p.m.
Lord DOUGLAS of BARLOCH: My Lords, there is one point on which I should like to have some explanation. I confess that I am not very familiar with how the law regarding crofters now stands, although I well remember the passage of the Act of 1912. At that time, and, I think, for a considerable time afterwards, the position was that a crofter did not pay any rates upon his improvements. This was a very great advantage which arose out of the peculiar nature of the crofting tenure, because the improvements did not belong to the landlord, and consequently were not part of the rateable hereditament. I do not know whether that position still obtains, but if it does, then it appears to me that the crofter who takes advantage of the powers given to him under the Bill to purchase a freehold of his land will then automatically be in a disadvantageous position in respect of liability for rates. I should be grateful if my noble friend Lord Kirkhill would explain whether or not that is so.
4.45 p.m.
Lord KIRKHILL: My Lords, I am gratified by the wide-ranging and informed debate which we have had on the principle of this Bill and by the acceptance on all sides, with the exception of the noble Lord, Lord Burton, that our approach to crofting reform is on the right lines. It is perhaps not widely recognised that only some 4 per cent. of the 14,000 crofters are able to earn a full-time living from their crofts, and that many are spare-time, rather than part-time, agriculturalists. Amalgamation and restructuring is rarely an effective answer to the crofter's difficulties, since it aggravates the problems attendant on a dwindling population with an imbalanced age structure. Reinvigoration of the crofting system must, to a large extent,

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depend on exploitation of non-agricultural forms of enterprise that can be based on the croft. If we are to provide a proper incentive to crofters to participate more fully in the opportunities which tourism and craft industries are increasingly offering in many parts of the Highlands, we must remove the constraints which are inherent in the present crofting code. That is our objective in giving crofters the right to acquire their house site and their croft land. At this point the Government stand in complete opposition to the views which the noble Lord, Lord Burton, has just expressed. If such a right is to be of any real value the price must be pitched at a realistic level which crofters can afford, and that is why we have adopted a price formula based on crofting value.
Not all crofters will, of course, want to become owner-occupiers, and every crofter will have the freedom of choice to remain as a tenant if he wishes. If he does, he will retain all his present rights, but gain a valuable new right to a share in the value of any land taken from his croft for development. For the first time the crofter's moral and historical rights in his land will be recognised and he will have an incentive to co-operate with his landlord in releasing land for developments which could lead to benefits for the local community.
There must, of course, be a proper balance between the release of land for development and the retention of land which is needed by active crofters. The previous Bill gave development absolute priority, even where the release of land from crofting would, in the Government's view, have been damaging to the local community. I am glad to say that the new Bill has benefited materially from our criticism in the other place, when my Party was in Opposition. This Bill not only puts responsibility for crofting control in the hands of the Crofters Commission, where it properly belongs, but also provides the Commission with an effective control mechanism which requires it to take into consideration both the community interest and any demand for land.
I now wish to answer as many of the points raised with me as I can properly do. I welcome the very general, though comprehensive, analysis of the Bill which the noble Lord, Lord Campbell of Croy,
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elucidated in his earlier remarks. I am pleased that, broadly, he welcomed the Bill. I can confirm the point which the noble Lord made when he talked about consultation during the period of time when he was Secretary of State for Scotland. I confirm that these consultations with many widely and broadly based organisations have continued. I could not really disagree with the noble Lord's historic assessment of an earlier period of introduction of this Bill, although I consider that Ministers, whether of junior or senior rank, are usually flexible, and I could not think that my honourable friends in another place had displayed other than their usual flair for political flexibility.
Perhaps I could explain, for the benefit of all your Lordships, a particular point which the noble Lord, Lord Campbell of Croy, raised—and I think the noble Lord, Lord Burton, also referred to this point—when he referred to the question of purchase on a 15-year basis. I would explain that the yardstick we have adopted for crofting value—and there was considerable discussion about this point in another place, I might add—was based upon a standard practice in the valuation of agricultural land, which is to use a rent capitalisation multiplier. This multiplier reflects the rate of interest sought by an investor: the higher the risk the greater the interest demanded on an investment and, of course, the lower the multiplier. In recent years farm land values with vacant possession have been high. Land worth £600 an acre could be expected to provide a 2½ per cent. return on an investment, involving a 40-year capitalisation multiplier.
Tenanted land is not such a good investment as land with vacant possession, and therefore its value is much lower and the expected rate of return on an investment in it is much higher. Recent precedents indicate values for tenanted farmland of 50 per cent. of vacant possession value, representing a 5 per cent. return on investment or a 20-year capitalisation multiplier. Extending the analysis, croft land is even less attractive as an investment. The crofting tenant has almost complete security of tenure, pays only a fair rent (which is generally about one-third of open market rents) and is entitled to compensation for permanent improvements. The landlord, however, is

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freed from providing fixed equipment, and has a right to periodic revaluation of rents. It is reasonable to assume, therefore, taking all these factors into account, that an investment rate of 6·6 per cent., or a 15-year capitalisation multiplyer, fairly reflects a crofting value for sale purposes and strikes a correct balance in land valuation comparing agricultural land values with crofting land values.
This formula should produce a price which is reasonable for the crofter but which is not unfair to the landlord, taking into account the landlord's right—and the noble Lord, Lord Campbell of Croy, mentioned this right specifically—to apply to the Land Court to have a fair rent fixed for the purpose of calculating the purchase price and the crofter's liability to make a second payment to the landlord on resale or disposal of the land within five years of acquisition.
Lord BURTON: My Lords, may I ask the noble Lord one question on that? He mentioned that a fair rent—I am not sure who it is fair to—should be one-third of the open market value of a croft. Could the noble Lord explain how that is a fair rent—one-third of what you can get on the open market?
Lord KIRKHILL: No, my Lords, I cannot explain that definition. I am professionally advised that it is, however, a fact. It is a fact which I assume valuers use as part of the formula. The noble Lord, Lord Campbell of Croy, also asked of me whether I could give him some indication as to the present position relative to the Secretary of State's crofting holdings. These actually number now approximately 1,950, including 200 tenants of fishermen's holdings. I can also tell the noble Lord that part of the ongoing process to which he himself earlier referred, and which still continues up until this time, is that we have received inquiries: 81, in fact, from crofts, 31 for part-crofts and 56 for house sites and gardens. Active purchases which are not yet completed number 57 in the case of crofts, 22 in the case of part-crofts and 20 in the case of house sites and gardens. Completed purchases at the moment number 5 as regards crofts; 4, part-crofts and 33, house sites and gardens. So this is an on-going process, as the noble Lord very rightly said, and these
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are the figures which I have at this time. They may be of interest to him.
Viscount AMORY: My Lords, will the noble Lord forgive me for intervening for one moment? I think he left the question which my noble friend Lord Burton asked in a rather unsatisfactory position. If I remember rightly, my noble friend asked how it could be that a value of one-third of the current market price could be regarded as a fair value. I think many of us would like to have an answer to that, if the noble Lord could give us some further explanation, because at first sight it looks a very odd thing indeed.
Lord KIRKHILL: My Lords, I can only reiterate that the facts as I understand them are that the usual amount is about one-third. Of course, to use the term "fair rent" is, I think, to use one of those euphemisms which are in common use today in the professional world. I cannot add in any way to the points I made earlier in that regard.
Lord BURTON: My Lords, may I help the noble Lord?
Lord KIRKHILL: My Lords, I think I should like to go on at this stage.
Lord BURTON: Will the noble Lord give us an answer, then, when we reach Committee stage?
Lord KIRKHILL: My Lords, I doubt whether I shall be able to give your Lordships a comprehensive answer, but certainly noble Lords are always free to return to a point at Committee stage.
The noble Lord, Lord Campbell of Croy, also asked if I could give some further explanation in general terms as to the question of housing assistance. I should like to say to your Lordships that it was quite clear that if the existing statutory provisions remained unchanged and crofters and cottars ceased to be eligible for housing assistance on becoming owners of their crofts or house sites, this would seriously jeopardise the success of the Bill. We therefore make provision in Clause 12 for a concession allowing crofters and their family nominees and successors and cottars who acquired the site of their dwelling-house to retain their entitlement for housing assistance for a period of seven years after the date of acquisition. There could of course be arguments for a different

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period, and indeed it is the case that when in Opposition my right honourable friend the Secretary of State canvassed the thought of extending the period to 21 years.
Lord CAMPBELL of CROY: My Lords, would the noble Lord give way for a moment? I should like to make it clear, because I think otherwise he may give the House a misunderstanding of the situation on this point—and I am referring to my own words when introducing the Bill in 1974—that we also, in our Bill, had this same period of seven years.
Lord KIRKHILL: My Lords, I was aware of that fact, but I wanted to point out that when in Opposition my right honourable friend the Secretary of State for Scotland canvassed the thought of extending it to 21 years, and I was going on to say that upon reflection we have returned to the seven-year period, which we regard as being just about right. I know that some people have argued that the right to assistance for housing should continue, not only for seven years but indefinitely. Indeed, there are those who have argued that the kind of assistance for housing given to crofters should be extended generally to owner-occupiers of houses in the crofting counties. I should make it clear that the primary responsibility for housing in these areas rests on housing authorities, and the new policy of designating housing action areas is now being extended to the Islands. As I have said it is for the housing authorities to determine their policy for housing in general in their areas.
As regards the indefinite extension of the right to housing assistance for crofters who become owner-occupiers, I must make the point that such an extension would be manifestly unfair to other owner-occupiers who are denied eligibility to the standards of assistance provided for crofters. Where a crofter purchases his house site and assigns the remainder of the croft, there can be no expectation of automatic entitlement to assistance to provide a house on the croft land. The Department will consider each case on its merits, but applications in cases of assignation to a member of the crofter's family in anticipation of bequest, or to an individual where the crofter is
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aged or infirm and unable to work the croft, will be sympathetically considered. Because of pressure on the available funds it is more doubtful whether housing assistance will be available in other circumstances, in particular the situation where the crofter or his successors have purchased the house site, sold the house and then sought assistance for the erection of a new house on the remainder of the croft.
I should like to add at this point a specific reference to the position of the Glendale holders. Their position will now change in that the availability of I housing assistance for the owners of holdings in Glendale Estate, Skye, who are deemed to be crofters by virtue of Section 22(6) of the Crofters (Scotland) Act 1955 for the purpose of housing assistance, will alter. Under the terms of the Reform Bill, crofters who purchase their house sites will continue to be eligible for housing assistance for a period of seven years from the date of acquisition of the site. To maintain the owner-occupiers of Glendale holdings on the same footing as crofters it is fair that future entitlement to housing assistance should be limited to holders as at today's date, or a family successor to the title, for a period of sewn years from the date of Royal Assent to the Bill. This will bring the Glendale holders into line with crofters who purchase their house sites after the passage of the Bill.
Lord BURTON: My Lords, on that point of the Glendale crofters, there are a number of other crofters, particularly in Skye, who are in the same position. I think that the Department have sold a number of their crofts there recently. Why particularly are the Glendale crofters, as opposed to others, put in a privileged position?
Lord KIRKHILL: My Lords, I am not aware whether there are other crofters in Skye in a similar position to those who are part of the Glendale holdings; but the noble Lord has raised a point of substance and I give him the assurance that I will look into the matter.
I should like merely to touch on two further points which the noble Lord, Lord Campbell of Croy, raised. I think that I should make some reference to the changes made from the previous Bill concerning the de-crofting of land. Not

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only will the Crofters Commission have fully within their power the responsibility for giving de-crofting directions, but the Bill includes specific guidelines. These guidelines were not written into the previous Bill. The guidelines will indicate the circumstances in which de-crofting may take place. In the Government view, these new provisions provide a more effective control in the interests of preserving the crofting communities.
The noble Lord, Lord Campbell, also asked about the definition of "croft" and whether the reorganisation of local government will create any difficulties in identifying the area of crofting. The Bill makes no change in the definition of a croft, which definition is already enshrined in existing crofting legislation. This is the legal definition. In practice, crofts may be identified as those holdings included in the Register of Crofts maintained by the Crofters Commission. The reorganisation of local government has made no change to the area of crofting which in future will continue to be identifiable geographically as the former crofting counties.
The noble Viscount, Lord Thurso, also gave a general welcome to the Bill, and from the Government's point of view I express pleasure at the overall welcome that he gave to it. I am aware of the Amendment that his noble friend put down in another place. I am aware that the Amendment did not carry. I can only say that the Government view has been clearly expressed by me in my opening remarks and whether the noble Viscount feels that the Amendment should be re-submitted, of course, he will judge within the discretion of his own assessment of today's debate.
The noble Lord, Lord Balfour of Inchrye, as did other noble Lords, gave a general welcome. On his specific question as to who will or will not bear the legal costs, I can tell him that in the case of conveyance of a house site the Land Court may determine that all the expenses, including those of the landlord, shall be borne by the crofter or cottar. This is to avoid the landlord being put out of pocket in a transaction he is being compelled to undertake under Statute. In the case of the purchase of croft land, the Bill makes no provision
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regarding the legal costs, leaving the matter to be settled in the case of an agreed sale as part of the agreement or in a case referred to the Land Court under the terms and conditions laid down by the court.
The noble Lord also raised the question as to the position of those who are owners of sporting rights. This point was also touched on by the noble Earl, Lord Cromartie. The position regarding those who have an interest in sporting rights is that on many crofting estates there are established shooting and fishing rights which the Government recognise are valuable assets, and I can appreciate the legitimate concern of the landlord that his shooting and fishing rights should not be damaged by the crofters' acquisition of his land. However, on most crofting estates sporting rights are usually exercised extensively over the common grazings and only to a limited extent over inbye land.
Lord BURTON: My Lords, this is quite inaccurate. On the East coast the acquisition of crofts would cause considerable damage to low ground shooting; for instance, in Easter Ross, the Black Isle and Inverness areas. It is a complete fallacy to say that these rights are exercised mostly on common grazings.
Lord KIRKHILL: My Lords, I express the Government's view. It is at variance with the view expressed by the noble Lord, Lord Burton. I must say that we are at variance and I will proceed. In general, the ownership of the common grazings will remain in the hands of the landlords, and the crofter's rights to purchase will affect the common grazings only where he has an individual apportionment which is adjacent or contiguous to his croft. In the Government's view, in the majority of cases, the landlords' sporting interests will be unaffected by the sale of land to crofters. However, provision is made in Clause 2(3) for reasonable safeguards for the landlords' sporting interests where these could be damaged by such sales of land. The Land Court is empowered to make it a condition of its order authorising the conveyance of croft land that the crofter grants a lease to the landlord of the shooting or fishing rights relating to the land. This protection is reinforced by the provision that it will be obligatory

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for the Land Court to impose a leaseback condition in any case where the court are satisfied that if such a lease were not granted the landlords' sporting interests would be materially affected. The Government think that these provisions provide an adequate degree of protection for the landlords' interests.
Lord BALFOUR of INCHRYE: My Lords, on the granting of a lease has the Government any views as to whether the lease is for perpetuity or for a limited number of years?
Lord KIRKHILL: My Lords, I cannot reply to that specifically at this time. I will take it on board and undertake to let the noble Lord have the official Government view.
Lord BURTON: My Lords, would the lease be enforceable on a crofter's successors if he sells the croft or if he dies?
Lord KIRKHILL: My Lords, the lease is one which is certainly enforceable through succession. The noble Lord, Lord Balerno, kindly gave me advance notice that he was to raise a specific question with me, and proceeded thereupon to do so. He will now certainly get the very official reply which I have before me, which is to the effect that the Crofters Acts lay down the criteria for the appointment of grazing committees and give them specific duties and powers. However, this does not necessarily preclude them from benefiting from EEC funds. It is open to any body of agriculturalists to form themselves into an agricultural producer or marketing group, and if they ensure that their constitution satisfies the conditions laid down for any particular form of national or EEC assistance available for joint activity, they will be in a position to apply for such aid. There is thus no need to amend the crofting legislation to that end.
The noble Lord, Lord Burton, has expressed his own personal crofting credo before your Lordships' House. His view is at variance with the Government's view. By his interventions he clearly shows that although the Government's general intention seems to have some consensus, its acceptance is not one which appeals to him. Undoubtedly we shall hear yet again from the noble Lord on many other points as he continues to study the Bill. The noble Lord, Lord Douglas of Barloch, raised a specific
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question with me. I regret that I am not able to reply specifically to him this afternoon, but I undertake to write to him in detail about the very fine point of legal complexity that he raised.
Finally, let me remind noble Lords that some people have opposed these proposals on grounds of principle; namely, that croft land should be brought within public ownership in some way instead of being held by crofters as owner/occupiers: others because they fear that the crofters, with their newfound freedom to own their land, will be a prey to rapacious "carpetbaggers" from elsewhere. The noble Earl, Lord Cromartie, touched upon that. I do not share this view. I think the crofters are hard-headed enough to protect their interests; they have had hard schooling in a harsh environment among landlords who have not always been as enlightened as they might. But this Bill gives the crofter equality at last with the landlords. He can now own his land. My Lords, I look forward to the new springs of energy and enterprise which this will release as a source of real benefit to the crofting communities and the Highlands as a whole.
On Question, Bill read 2a, and cornmitted to a Committee of the Whole House.

POST OFFICE (BANKING SERVICES) BILL
5.13 p.m.
The PARLIAMENTARY UNDERSECRETARY of STATE, DEPARTMENT of INDUSTRY (Lord Melchett): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, that the House do now resolve itself into Committee.—(Lord Melchett.)
On Question, Motion agreed to.
House in Committee accordingly.
[The Viscount GOSCHEN in the Chair.]
Clause 1 [Extension of power of Post Office to provide banking services]:
Lord ABERDARE Lord ABERDARE moved Amendment No. 1:
Page 1, line 12, at end insert—
"(3) The words "banking services" in this section shall not include the issue of

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credit cards without the approval of the Secretary of State and the Treasury."
The noble Lord said: This is the first of seven Amendments, none of which is very revolutionary. They are all intended to be along the lines and in the spirit of Lord Melchett's words on Second Reading, and I hope that some of them at any rate will appeal to him and he will be able to accept them. The noble Lord stressed in his Second Reading speech that Clause 1 is largely a matter of clarification and for the removal of doubt in respect of the main Act, the Post Office Act 1969. He hoped we would not exaggerate the significance of this particular Bill. In his own words, he said that it represents a slow, cautions advance and removes a technical and obscure qualification. If we thought this was all it really did, I do not think we should be so worried about the Bill. In order to help us and set our fears aside, I hope that this Amendment, and one or two others I shall be moving, follow the Government's objective of a slow and cautious advance.
Under the Bill as it stands at the preent moment, the Giro will be able to issue its own credit cards. Is that consistent with a slow and cautious advance? So far as the history of credit cards is concerned, I do not think it is. This is confirmed because both Access and Barclaycard have proved extremely expensive. We are now dealing with public money and anything that could lead to the losses that both Access and Barclaycard have experienced does not seem to be consistent with a slow, cautious advance. It has been reported that the cost of setting up the Access operation, for example, was some £10 million, and I doubt whether that has yet made a profit. Barclaycard is also currently reported to be making losses.
So why do the Government suggest that Giro should risk public money in such a hazardous venture? In another place there was an Amendment on these lines which would not have allowed Giro to issue credit cards at all. I have not gone so far as that; I have merely suggested that before they do so they should at least receive the approval of the Secretary of State and the Treasury. I doubt whether Mr. Singer of Giro wishes to launch his own credit card; I should
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imagine that the difficulties would be overwhelming, particularly with the Consumer Credit Act now on the Statute Book which, in Section 51, makes it an offence to give a person a credit token if he has not asked for it. That would make it very difficult for him to launch a credit card of his own. I should have thought that this Amendment, which is only erring on the side of caution, would have been perfectly acceptable to Giro. I beg to move.
Lord CACCIA: I must first declare an interest: I am a director of the National Westminster Bank. I do not speak for that Bank or any part of the banking system; I speak entirely personally, as is proper in your Lordships' House. I hope that the Government will be ready to consider the points that are being put forward, and will be put forward, in the interests not of inhibiting Giro from entering into these various activities, but in the interests of slow and cautious progress.
As the noble Lord, Lord Aberdare, has already said, the clearing banks and others who have started credit cards in this country and elsewhere know that the launching years are apt to be expensive. In addition to that, a great number of credit cards are now available in this country, and it is a question of judgment whether this is an appropriate time to launch another such activity on behalf of Giro, as part of the banking services which it might wish to have. But it is not suggested in this Amendment that it should be prevented; merely that caution should be shown about the decision taken, and the Secretary of State and the Treasury should be known to support it, thereby bringing some further element of public accountability into the operation of Giro.
Therefore, once again, may I say that, like the noble Lord, Lord Aberdare, I hope that the Government might think it in the interests of Giro itself to have this kind of backing behind any extension of its activities that may be contemplated with credit cards.
Lord BANKS: When an Amendment somewhat similar to that to which the noble Lord, Lord Aberdare, has already referred was discussed in another place, the Minister of State said that there were no plans to introduce credit cards, which

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I recognise is not an argument against this Amendment. He went on to say that if Giro wants to bring forward proposals of this kind it will have to put them to the appropriate authorities. What he meant by that was not very clearly explained, and I am wondering whether the noble Lord, Lord Melchett can clarify that for us when he replies to the discussion on the Amendment. To what extent if at all, would the 1969 Act, the present Bill and the legislation which I understand is promised to control the banks and Giro, affect the situation if Giro decided to go ahead with a proposal for credit cards?
This Bill provides for Giro to compete on more equal terms with the clearing banks and, having agreed the principle, I would look very carefully at any proposal to restrict its application, even though there may be no plans to develop in that field at the moment. The Amendment is clearly not to protect the public as a whole, because that would have to cover all people who offer credit cards; nor to protect the economy, because the same would apply there. It is not that credit cards ar regarded as undesirable, because, as has already been pointed out, this Amendment does not cut them out altogether. I think the Amendment arises from a fear about the alleged lack of expertise, or lack of commercial wisdom, of the management of Giro. It seems to me that it passes the ultimate commercial decision to the Secretary of State and the Treasury, but I wonder what evidence there is that the Secretary of State and the Treasury will be more expert in making a commercial decision than the management of Giro. I must confess that I find it a little difficult to accept the doctrine that the gentlemen in Whitehall know best.
5.24 p.m.
Lord MELCHETT: I am very grateful for the spirit in which the noble Lord, Lord Aberdare, introduced this Amendment and the other Amendments which stand in his name this afternoon. I accept that he moved the Amendment very much in the general spirit in which I spoke to the Bill on Second Reading. I must say that I found some favour with the remarks of the noble Lord. Lord Banks, as I did when he spoke on Second Reading, and agreed with a lot of it. I
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hope that I shall be able to answer the questions which he asked me, and meet the fears which have been expressed by the noble Lords who supported the Amendment.
I know that some peopie do not like credit cards very much at all. Indeed, I believe my honourable friend the Minister of State in another place said that when he was given a credit card he cut it up into small pieces and sent it back again. The noble Lord will know that I, coming from a banking family, would not sneeze at somebody who was prepared to give me up to 60 or 90 days' credit at no charge at all, which, if one pays one's bill promptly to at least some of the credit card companies, is what one is getting and I think it is a very useful service. So that my honourable friend and I do not see eye to eye on the merits of credit cards in general.
But, as the noble Lord, Lord Banks, pointed out, that is not what the Amendment is directed to. It is the Government's view that Giro account holders are no less entitled to the facility of credit cards than account holders with other banks. However, the Government have had no substantive discussions with Giro about the introduction of credit cards; neither has Giro put forward any firm detailed proposals so no firm views have been formulated about the timing of the introduction of credit cards by Giro. We have done no more than agree in principle to the introduction of credit cards. This enables Giro to explore the potential and prospects for such a service. If and when a time comes for Giro, in the light of its own commercial judgment, to submit firm proposals, they will he considered very carefully by the appropriate authorities, but I would stress—as I think the noble Lord, Lord Banks, said—that in the first instance this is a matter of the Giro management's own commercial judgment.
I certainly would not follow the noble Lord, Lord Aberdare, and I hope he would not expect any Member of this Government to follow him, in his rather stringent comments about the private sector credit cards—Barclaycard and Access. I do not have any figures on their profitability, but I am sure that in this field, as in others, the private sector is doing very well. We have stressed during the passage of the Bill that before

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the introduction of any new services by Giro, or before the extension of existing services, Giro will have to seek the approval of my Department, which is the Department of Industry, and of the monetary authorities—the "monetary authorities" being the umbrella term which I understand includes the Bank of England and other Government fiscal and monetary authorities. So I hope that that is clear. I do not believe that writing a statutory requirement into the Bill, as this Amendment would do, would add very much and I suggest that we should hesitate before putting such a statutory obligation uniquely on Giro of all financial institutions.
Lord CACCIA: Before the noble Lord sits down, he has not explained very clearly who the "appropriate authorities" are, but I accept his statement on that. But if they came to a decision about a new development such as this, would Parliament be informed? As I said earlier, this is a matter for public accountability and in some other cases, such as the nationalised industries, one of the troubles has been that the public accountability side comes to light very long after the event. So I should have thought it was in the interests of clarity from the beginning that an announcement was made in Parliament when such a decision was taken.
Lord MELCHETT: It might be convenient if I responded to that point, as the noble Lord phrased the question before I sat down. If I may, I should like to take this away and check on it and possibly write to the noble Lord. I am not clear whether he is asking me about credit cards in particular, or about any extension of Giro's services, but one can see that it would be very difficult and time-consuming to come to Parliament every time Giro proposed some minor change; and, indeed, very restrictive on its commercial ability to compete fairly with the banks. My view is that, unless some change in Giro's financial structure or arrangements was necessitated by an extension of services, it would not be obligatory upon the Government to come and inform Parliament. The noble Lord may have seen that there has been some reporting in the Press of Giro's discussions with Barclaycard about this matter,
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no doubt prompted by the passage of this Bill through Parliament, so I think it is very unlikely that any extension of this kind in Giro's services would be undertaken without the public being aware. As I have already said, we have given agreement in principle for Giro to explore the possibilities of a service, so Parliament is being informed at a very early stage.
Lord ABERDARE: I should just like to explain, particularly for the information of the noble Lord, Lord Banks, the reason why we have put down this Amendment. It is entirely to protect the taxpayer. It is public money that is involved here, for this is a public sector banking operation. If credit cards were to be issued, money would be put at risk. What we on these Benches are concerned about—I should have thought it would be astonishing if the Liberal Party were not equally concerned about it—is that there should be some Parliamentary control over this investment. In the case of a public sector operation, the only way we can control investment is through the Secretary of State. Heaven knows, we do not like giving more powers to the Secretary of State than are necessary! But there seems to be no other alternative in order to control the operations of Giro. It may be that there is another alternative but I have not yet understood it.
The noble Lord, Lord Melchett, has told us—and this would put some of my fears to rest—that before Giro goes into credit cards or into any new field of operation, it would have to obtain the approval of the Department of Industry and the financial authorities. If I could be told where this is laid down and why it has to happen—I take it that these are the appropriate authorities that the noble Lord, Lord Banks, asked about—and could be sure that this is so, and if I could also be told where it is to be found in any legislation, I should be perfectly happy to withdraw this Amendment. However, it was because we could see no way in which Giro could be coil-trolled and no way of ensuring that Giro moved in a slow, cautious way that these Amendments have been put down.
If the noble Lord can satisfy me about where the control lies, I shall be very pleased to withdraw this Amendment.
Lord MELCHETT: I think I can give the noble Lord that assurance. There are probably three sources of control. In the first case, I am advised that it is almost certain that under Section 41 of the Post Office Act the Treasury's statutory powers would be engaged were Giro to issue credit cards. It is hard to envisage the operation of a credit card scheme without the existence of a banking fund to meet debts as they accumulated. Such a fund would be required to be set aside as an asset under Schedule 2 to the Act and would require the Treasury's designation under paragraph 17 of Part II of that Schedule. As I said to the noble Lord, Lord Caccia, if financial rearrangement, restructuring or new funds were concerned, certainly this would have to be made public.
I am sure that the noble Lord, Lord Aberdare, knows better than I do that in the banking world these things are not done simply by people having recourse to their statutory powers. I understand that bankers are civilised people who consult each other, in particular the Bank of England, when measures such as the introduction of a new credit card are contemplated. Even if he has not met Mr. Singer, I am sure that the noble Lord would not expect him to undertake something like this without coming along to the Government and the Department of Industry and consulting the Bank of England. I understand that the Bank of England Act 1946 gives reserve powers to the Bank which, given the way people operate, are unlikely to be used but would enable them to call upon Giro to provide information and tell them what they were doing, were Giro not to behave in the way in which I am sure we all know it will behave.
Lord ABERDARE: Did the noble Lord say that there were three sources of control? He mentioned Section 41 of the Post Office Act and the Bank of England Act. Is there another one?
Lord MELCHETT: I hope that all my references to the gentlemanly way in which such business is normally conducted constitute by far the most powerful kind of control, and it is the third limb of my argument.
Lord ABERDARE: I suppose that this is the best we can do. I am not very
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happy with the "gentlemanly" argument. It may be all right but it is not the kind of thing on which one usually relies when considering legislation. If, indeed, there are restrictions under Section 41 of the Post Office Act, if the Bank of England have powers, if necessary, under the 1946 Act, and if the noble Lord gives me his assurance that these two provisions effectively mean that Giro could not issue its own credit cards without prior consultation with the Treasury—this does not cover the Department of Industry point, but I am rather more concerned that the Treasury should have the right to approve—then I am prepared to accept the noble Lord's assurance and beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
5.35 p.m.
Lord ABERDARE Lord ABERDARE moved Amendment No. 2:
Page 1, line 12, at end insert—
"(4) The words 'banking services' in this section shall not include foreign exchange transactions where such transactions are not authorised by account holders without the approval of the Secretary of State and the Treasury."
The noble Lord said: I beg to move Amendment No. 2. In the way it is phrased this Amendment is on similar lines to Amendment No. 1. Again it follows on an Amendment which was tabled in another place but seeks to go a little less far. Instead of preventing any kind of foreign exchange transaction from being undertaken by Giro, it says that such transactions can be authorised only with the approval of the Secretary of State and the Treasury. Again this Amendment is put down with the idea that there should be some control and that Giro should proceed slowly and cautiously. It worries many of us that there should be the possibility of Giro dabbling in the foreign exchange market, at least without Treasury approval. I appreciate that Giro may have to carry out foreign exchange transactions in the course of dealing with its clients' business and I have no objection to that. We have sought to exclude that point from the Amendment by saying:
"where such transactions are not authorised by account holders".
I do not understand, however, why it is necessary for Giro to have any further

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powers with regard to foreign exchange transactions.
When the matter was debated in another place, the Minister said that already Giro carries out a certain number of transactions of this kind in making settlements with other Giro services in Europe. Presumably the need for these settlements with other Giro services arises from transactions which have been authorised by account holders. In other words, Giro account holders have undertaken pertain transactions in other European Giro operations and there is a need for the two Giro authorities to deal together. That would be covered by my exclusion of:
"where such transactions are not authorised by account holders".
If this is not so, where else do these foreign transactions arise? We are very sceptical about the need for Giro to operate in foreign exchange. It is a very dangerous field, as the noble Lord, coming from the banking family that he does, will appreciate. While allowing Giro to conduct the transactions which are absolutely necessary for the normal conduct of its business, we thought it would be rather more cautious to have certain restrictions placed upon Giro when it comes to investment in foreign exchange, or speculation (although "speculation" is rather an unpleasant word) and putting its own money, which I repeat is public dividend capital, into foreign exchange transactions when that is not strictly necessary. Once again this Amendment is designed to implement that cautious approach which the noble Lord, Lord Melchett, has rightly stressed. I beg to move.
Lord CACCIA: May I support this Amendment, introduce just one other argument, and comment also on what the noble Lord, Lord Banks, has said, with which I have some sympathy.
Surely the difference between Giro and a private bank is that Giro is acting for the community. It is that aspect, and the public accountability aspect, which to my mind suggests that certain special caution is desirable in the interests of Giro itself. Obviously there are certain foreign exchange transactions which one does not have to be in the banking business to know about: one has had only to read the newspapers in the course of the last year or two to know that they have
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been extremely expensive. That is one thing for a private bank, but it would be looked at rather differently if it were done by a bank acting for the community. Therefore, I shall be interested to hear what the noble Lord, Lord Melchett, says as to why the community in this case—the Giro itself perhaps—does not need a little special protection and care.
Lord MELCHETT: I am having an interesting afternoon; having spent time on the first Amendment standing up for Barclaycard and Access I was staggered to hear the noble Lord say that the difference between Giro and the others was that Giro was acting for the community. My understanding was that the role which the major clearing banks see themselves as playing was just that acting for the community. But if the noble Lord means that public money is in Giro I take the point, although I stress that all the banks are acting for the community, at least in one sense.
My understanding is that Giro is already involved in foreign exchange transactions of the kind which the noble Lord, Lord Aberdare, wishes to make subject to the approval of the Secretary of State and the Treasury. In view of what the noble Lord said about not wishing to extend the power of the Secretary of State more than was necessary—and indeed that certainly rings a bell in connection with the discussions which we had on the Community Land Act when it was passing through this House, and cries from noble Lords opposite that the powers of the Secretary of State should not be extended—I hope we shall be able to agree that the position as it is now is probably the best. It is not the Secretary of State who operates control of the Giro but the Bank of England. As I believe the noble Lord said, Giro needs foreign exchange currencies to enable it to make overseas payments on behalf of its customers. Giro also operates reciprocal account arrangements with other Giros overseas under the terms of the Universal Postal Union agreements. These transactions require Exchange Control consent which Giro has received from the Bank of England. The terms of these consents are restricted by the types of transactions and by the usual strict limits on daily holdings of foreign currency.

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Those noble Lords who have experience of foreign exchange transactions will know that it is not possible to conduct business on a fully "covered" basis. Currency has to be purchased in round amounts as a result of the pattern of overseas transactions, but as I have explained Giro has to keep within strict limits imposed by the Bank of England. Should there be further developments in the foreign exchange activities of Giro, they will be subject to close control and scrutiny by the Bank of England, to whom Giro makes returns of its transactions in foreign currencies.
I hope the noble Lord will agree that the fact that the Bank of England is exercising this close and strict control over the activities of Giro in foreign exchange will be seen as preferable to the alternative which he has suggested; that is, that the Secretary of State and the Treasury should be responsible.
Lord ABERDARE: The noble Lord appeals to a soft spot in my heart, because I prefer the Bank of England to the Secretary of State. I am satisfied with that explanation and I think it is in line with my Amendment because the two types of business which the noble Lord said were already being conducted by the Giro in the foreign exchange field were either on behalf of customers, which presumably in my Amendment is covered by the words,
"where such transactions are…authorised by account holders",
or reciprocal arrangements with other Giros overseas, which again could arise only because there were transactions undertaken and authorised by account holders. That satisfies me that what is happening at the moment in the Giro is what my Amendment would enforce upon the Giro. Therefore, if any new kind of operation in the foreign exchange field is subject to exchange control consent (which is what the noble Lord said) and the Bank of England has the controlling power over it, then I accept that assurance and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 1 agreed to.
5.45 p.m.
Lord ABERDARE Lord ABERDARE moved Amendment No. 3:
After Clause 1, insert the following new clause:
Duty to comply with Government directions
". It shall be the duty of the Post Office to comply with such directions as may be given to it in respect of its banking services by the Secretary of State with the approval of the Treasury."
The noble Lord said: This Amendment is again designed to try to discover from the noble Lord who were the so-called "appropriate authoritiess" who were to ensure the cautious and limited approach of Giro. During the Second Reading debate we heard much about the cautious and limited approach that Giro would be making in its future development and that it would be under the control of the monetary authorities. The noble Lord then sought to reassure us that we were totally wrong in thinking that there would be a sudden surge into the banking field.
I drew the attention of the noble Lord to the contrast between the Government's actions in regard to the Trustee Savings Banks and their actions in regard to the Giro. The Trustee Savings Banks are to be subject to a 10-year period of control by the Government which will be gradually relaxed until they have reached the full status of the existing clearing banks. Presumably what is right for the development of the Trustee Savings Banks would also be right in order to follow the advice of the noble Lord, Lord Melchett, and make sure that the Giro also moves forward in a cautious and limited way. When I tabled this Amendment I had certainly not understood who the authorities were which would ensure this and I could not see that there was anything in the Bill that gave anybody power to ensure that they only developed slowly and cautiously. Therefore, I tabled this Amendment.
In the course of discussing Amendment No. 1, we have heard that there are certain powers under the Post Office Act and under the Bank of England Act which can allow the so-called "appropriate authorities" to have some control over what Giro is doing. However, I should like to have an explanation of how the Department of Industry and the Treasury control the development of Giro. For example, in the course of the Second Reading debate, the noble Lord told us that at the moment personal loans

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are limited to £2 million and overdrafts to another £2 million. This is the sort of restriction and slow development which one would think was perfectly right; but where are these powers that enable the Secretary of State and the Treasury to enforce such limits? It may be that they are the same powers as the noble Lord mentioned in discussing the first Amendment. I tabled this Amendment because I could not find where the powers were to restrain Giro and to make sure that its development was cautious and slow. I beg to move.
Lord BANKS: It seems to me that the powers requested in this Amendment are too sweeping and that inevitably they must lead to day-to-day interference with the working of the Giro. Surely the 1969 Act, the present Bill as it now stands and the promised legislation to control the banks and the Giro will he sufficient, particularly in the light of the explanation of the working of this framework which was given by the noble Lord, Lord Melchett, although like the noble Lord, Lord Aberdare, I would welcome any further explanation that he is now able to give.
Lord MELCHETT: I think I have already dealt with the financial controls exercised by the Bank of England, normally by the usual processes of consultation and discussion, and the powers under the Bank of England Act, if that is called upon. My reluctance to mention that is the understanding that it is such an unheard of idea that anyone would have to have recourse to statutory powers, that it would not be normal to mention it. But, of course, in addition there are three powers of direction affecting Giro in the 1969 Post Office Act, under Section 11: the Secretary of State may give directions of a general character in the national interest; secondly, the Secretary of State may give directions, again of a general character, in order to remedy defects in the general plans or arrangements in the Post Office, and thirdly, the Secretary of State can give a specific direction relating to national security or external relations with other countries. That is a superficial summary of a quite lengthy passage in the Act of 1969, as I am sure the noble Lord, Lord Aberdare, knows. It is set out in Section 11, subsections (1), (2), and (3).
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These powers already operate in respect of the banking services of the Post Office. Under Section 11(5) the Post Office is required to comply with them. The noble Lord, Lord Banks, touched on the possibility that this Amendment could give the Secretary of State power to make specific directions to the Post Office about Giro operations. I would agree with him if that was intended, but from the introductory remarks of the noble Lord, Lord Aberdare, I think it probably was not. But if that were intended, and the Amendment were included, it would be something very regrettable, and would, I agree with the noble Lord, Lord Banks, run the risk of leading the Secretary of State to interfere in a very detailed way with the Giro and in a way which would be quite unprecedented in the Statutes of the nationalised industries.
Lord ABERDARE: It was not intended in any way that the Secretary of State should interfere. It was intended, as the noble Lord realised, to make sure that there were powers so that Giro could not go headlong into banking services without some control, and someone being able to ensure that it moved cautiously. I think the noble Lord has satisfied me that these powers exist in the Post Office Act. Therefore, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 2 [Financial objective]:
Lord ABERDARE Lord ABERDARE moved Amendment No. 4:
Page 1, line 14, leave out ("concurrence") and insert ("approval").
The noble Lord said: This is a very simple Amendment. It is to leave out the word "concurrence" in the second line of Clause 2 and to insert the word "approval". At the moment, the Secretary of State from time to time may determine, after consultation with the Post Office, and with the concurrence of the Treasury, financial objectives to be achieved. Later on, in Clause 3(7), we have another reference to the Secretary of State acting with the approval of the Treasury. I do not know whether the words "concurrence" and "approval" mean exactly the same thing. If they do, I have no objection. But I have a feeling that "concurrence" is slightly

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weaker than "approval"; that you can act with someone's concurrence if in fact they do not object, but you cannot act with their approval unless you seek their approval first. Therefore, in order to strengthen this provision I hoped that the noble Lord, Lord Melchett, would accept the word "approval" instead of the word "concurrence". I beg to move.
Lord MELCHETT: As usual, the minds of the Parliamentary draftsmen are a mystery to mere mortals! I must say my first reaction was to agree entirely with everything said by the noble Lord, Lord Aberdare, but I am advised that there is absolutely no difference between "approval" and "concurrence", and indeed "consent", which I understand is also a similar term used in Statutes. Why one term is used in one place in the Bill and a different term in another, I do not know, but I can assure the noble Lord that there is no difference in the meaning, or difference in the control which will be exercised as a result of using one word or the other. I suggest that on that basis there is no real need to amend this particular word in the Bill.
Lord ABERDARE: In that case, I should have thought it would have been quite easy to accept my Amendment if there is no difference. However, rather than cause a lot of reprinting, and having been given the assurance that "concurrence" means "approval", I will beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
5.55 p.m.
Lord ABERDARE Lord ABERDARE moved Amendment No. 5:
Page 1, line 20, at end insert—
"(2) It shall be the duty of the Secretary of State to inform both Houses of Parliament as soon as possible of any such determination."
The noble Lord said: This may seem a rather strange Amendment to be moving in this House, but I was rather worried about subsection (1) of Clause 3, which reads:
"The Secretary of State may from time to time pay to the Post Office out of moneys provided by Parliament such sums, to be used by it for the purposes of its banking services, as he thinks fit."
In the course of the discussions we have had on this Bill—which have been exhaustive in another place—we have discussed the question of public dividend capital,
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and particularly the matter of fair competition between the Giro and the present clearing banks. Obviously it is important that if that competition is going to be fair, they must operate pari passu so far as capital-structures are concerned. It seemed that, under this subsection, the Secretary of State was completely free at any time to increase the public dividend capital available to Giro without any reference at all to Parliament which, in this case, because it is a financial matter, is obviously applicable only to another place. I am talking to the wrong Amendment; I have been talking to Amendment No. 6.
Lord MELCHETT: Perhaps we can take Amendments Nos. 5 and 6 together. If the noble Lord, Lord Aberdare, would like to do this to make things move more quickly, I am happy.
Lord ABERDARE: I do not know whether that is allowed, because Amendments Nos. 5 and 6 relate to different clauses. I do not think I can do that, but I will make my remarks shorter when I come to Amendment 6.
Amendment No. 5 is a very much more simple matter. Clause 2 allows the Secretary of State to determine financial objectives for the Giro. Already we have been told that for the first three years of Giro—that is, the years up to 1977/78—on average the Giro growth is expected to obtain a return of 12½ per cent. on its public dividend capital. Obviously, it is of great importance so far as fair competition with the private sector is concerned if at any time the Secretary of State can alter that financial objective. It seems to us only right that, if he were to act under this clause and make a new determination, he should inform both Houses of Parliament as soon as possible after he had made such a determination. After all, Parliament has a responsibility here. This public dividend capital is provided by the taxpayer, and the return on it is of vital importance so far as fair competition is concerned. Therefore, surely if under the Bill the Secretary of State is able to make new determinations, he should inform both Houses of Parliament.
I am not asking for any control. I am not asking that either or both Houses of Parliament should agree, but simply that

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they should be informed every time a new determination is made. I beg to move Amendment No. 5.
Lord MELCHETT: I am afraid that this Amendment would single out the Post Office for special treatment in a way that I understand is not precedented in other Statutes for nationalised industries. In the nationalised industries legislation, only that relating to the British Steel Corporation and the British Airways Board contains provisions relating to return on capital. Neither Statute contains a provision such as the noble Lord, Lord Aberdare, has in mind in this Amendment.
Having said that, of course I fully recognise the legitimate interest and concern of Parliament. Indeed, in announcing during the Second Reading debate in another place the initial financial objective of 12½per cent.—and I reiterated it during the Second Reading in this House—and in announcing that objective well in advance of enactment, I think we can fairly claim to have met the spirit of the noble Lord's Amendment already. Certainly the House should know what progress the Post Office Giro makes as a bank, and this will be reported in the Post Office Report and Accounts, which I think we deal with in a later Amendment. In addition, I am happy to give the noble Lord an undertaking that we will inform Parliament if we decide to change the 12½ per cent. objective we have announced. I hope with that clear undertaking the noble Lord will consent to withdraw this Amendment.
Lord ABERDARE: I am quite content with that assurance. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 2 agreed to.
Clause 3 [Government investment in Post Office's banking services]:
6.1 p.m.
Lord ABERDARE Lord ABERDARE moved Amendment No. 6:
Page 2, line 1, after ("may") insert ("with the consent of the House of Commons").
The noble Lord said: I think I pretty well finished my speech on Amendment No. 6 when speaking to the previous Amendment. The object of this Amendment
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was simply to give Parliament, in this case the House of Commons, control over money which can evidently be given to the Post Office at any time by the Secretary of State. Admittedly, it is money that has already been provided by Parliament, but it is money which can well affect the matter of fair competition between the public sector Giro and the private sector banks, and it would seem to me that the House of Commons should have some say before this money is given to Giro. I beg to move.
Lord MELCHETT: The Post Office will receive its initial tranche of £13 million of public dividend capital under Clause 3(6) of the Bill. After that we have no further issues of public dividend capital in mind. Notwithstanding the pitfalls foreseen by the noble Lord in the field of credit cards and currency speculation, Giro's banking services are intended to be self-financing, and no future capital requirements directly linked with the extension of its banking services are foreseen The noble Lord may argue that that is all the more reason for accepting this Amendment. On the other hand, such a requirement to secure the consent of the House of Commons is not provided for in the other Acts that deal with public dividend capital which I mentioned, the Iron and Steel Act 1969 and the Civil Aviation Act 1971. Once again I think it probably would be undesirable to depart from those precedents. It would be singling out Giro in some particular way. I think I would need to be convinced of the justification for any particular treatment of Giro in this respect.
Moreover, any future issues of public dividend capital, if there were to be any—and, as I say, it is not our intention at the moment that there should be—would be provided for separately in a specific sub-head in one of my Department's Votes in an Estimate or Supplementary Estimate, and would thus be subject to the normal procedures in another place. The House of Commons will therefore be free to exercise its full rights over any future Departmental provision for this purpose. Lastly, noble Lords will note that in Clause 5 we provide for payments of PDC or dividends on that PDC to be reported to the Comptroller and Auditor-General, and through him to both Houses of Parliament. So I would suggest to the noble Lord that

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sufficient safeguards and scrutiny by another place do exist under the existing arrangements.
Lord ABERDARE: I am grateful to the noble Lord for that explanation. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 3 agreed to.
6.4 p.m.
Lord ABERDARE Lord ABERDARE moved Amendment No. 7:
After Clause 3 insert the following new clause:
"Report
.—(1) It shall be the duty of the Post Office to make to the Secretary of State as soon as possible after the end of each accounting year a report dealing with the operations of its banking services during that year.
(2) It shall be the duty of the Secretary of State to lay before each House of Parliament a copy of each report received by him under this section."
The noble Lord said: I beg to move Amendment No. 7. The noble Lord has on two occasions, on the last two Amendments, quoted precedents, and he is obviously very keen on following what has happened in the way of precedent. I can only tell him that the wording of this new clause is drawn directly from the industry Act, with which he is very familiar, and I can only presume that on the basis that it is a perfectly good precedent he will accept the Amendment without further ado. But if that does not impress him sufficiently, I would also wish to argue that this is an important Amendment in its own right, because if the Giro is to move into the provision of all banking services it surely is right that those who are making use of those services, as well as Parliament, should be able to study a proper statement of accounts and an annual report. I know that the noble Lord will tell me that there is a section in the present Post Office report which is devoted to Giro, but I would suggest that rather more than that is required if the Giro is to take on this very special rôle. If it is to become a full hank, if it is going to compete, as the noble Lord has told us, with the clearing banks, then I think that the least it should do is to publish its own annual report and accounts separately from those of the Post Office.
After all, this Post Office Report is a very bulky document, and there will be
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many people who are interested only in the Giro account that is given in that large Report. Many of the customers of Giro particularly will not be in the least interested in the general Post Office Report; they will only want to know what progress Giro itself is making. I should have thought that in the interests of economy the noble Lord would not wish that every time anybody wanted to see what Giro was up to they would have to be sent this enormously bulky and costly document through the post, at considerable cost in postage. If the noble Lord is not able to accept this Amendment, I hope he will at least consider the point that the Giro section of this Report should be separate, or at least it should be separable, so that everybody who wants to see the Giro report and accounts does not have to receive the full bulky document. I beg to move.
Lord CACCIA: May I intervene for one minute to support that proposal made by the noble Lord, Lord Aberdare. During the course of this debate the noble Lord has shown much understanding and sympathy with the spirit of the Amendments. He may say that as there is a Commission already looking into the future of the Post Office, and as one of the items in that Commission's terms of remit may be the question of whether the postal services and the telecommunications services should be divided, this is not the moment to hive off another activity before these matters have been generally considered. All the same, I hope that he will give at least some sympathy to the last part of what the noble Lord, Lord Aberdare, said, that there might be a detachable portion, or some report which is not necessarily part of the longer Report of the Post Office, with postal services, Giro and telecommunications all lumped into the same Report.
In response to one of the noble Lord's earlier interventions, may I say that I am delighted that he, as a member of a banking family, accepts that the clearing banks provide a community service. That, I think, is not in question. There is a separate question though, and it is a serious one, and it is what has really moved the noble Lord, Lord Aberdare, and certainly moved me, to intervene here. That is the public accountability of a new service being

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offered for and by the community. As there have been other cases of nationalised industries where this public accountability has become a matter of public debate and question, then it is surely necessary—and I think the noble Lord has accepted this and shown that it will be carried out—that very great care should be taken in expanding the services of the Giro, so that these kind of subsequent criticisms may not arise.
Viscount BARRINGTON: Although not knowing a great deal about this matter I rise briefly to support this Amendment on me grounds which the noble Lord, Lord Aberdare, has put forward. From the little that I have heard of this question it seems that when we consent to a thing, when we approve of it, and when we concur with it, makes no difference. But one is frequently asked in this House to consent to things one does not necessarily approve of, and I agree that the less print one has to wade through in order to know whether one approves of a thing or not, the better. I should like to support the proposition that, if it is possible for this report referring to Giro to be separable, that would be an excellent idea.
6.11 p.m.
Lord MELCHETT: I had better set the Record straight. When the noble Lord comes to study Hansard tomorrow he will find that I was saying that it was my understanding that the clearing banks viewed their role as serving the community. I was not expressing any view of the Government on that, but merely sticking up for them as I felt that the noble Lord had, by implication, rather done them down. He has now put me straight on that. It was not my intention to pray in aid the Carter Committee and the fact that it is looking into the Post Office at the moment. I have not used it in defending the Government's position on any of these Amendments, and I do not intend to on this one.
I think that the noble Lord, Lord Aberdare, has a good point—certainly if he quotes the precedent of the 1975 Industry Act, although I am not sure that that is quite as applicable as the precedents in the other nationalised industries Acts that I was quoting; he has my considerable sympathy. In the
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White Paper on this Bill the Government said that they will require the Post Office to publish separate Giro profit and loss accounts and balance sheets, and the White Paper pointed out that that has already been done in respect of 1974–75. By "separate" I mean a distinct presentation of Giro's performance within the Post Office's annual report and accounts.
The requirement on Giro to produce separate accounts is not specified in this Bill because, in our view, sufficient statutory provision already exists in Section 42(1) of the Post Office Act 1969. Indeed, that may well be why we have not followed the excellent precedent set in the Industry Act in this matter. The noble Lord is no doubt familiar with the provisions of the 1969 Act which provide that the accounts and the descriptive commentary should be made available to the public, and therefore I shall not go into that in any detail. The noble Lord had economy very much in mind, and of course that is very much in the forefront of everyone's mind at the moment. The noble Lord suggested that with that in view Giro should publish a separate, self-contained report and accounts and not have them included in, or at least have them separable from, the Post Office's own overall presentation. I agree that that might be desirable, particularly in the future if and when Giro expands, as I hope it will.
I should like to take up one remark which the noble Lord made in passing when he said that I had said that Giro would be competing with the clearing banks. I think that even the staunchest advocates of Giro's prowess would not pretend that Giro on its own at its present size is competing with all the major clearing banks as an equal partner. Our concern during the passage of the Bill has been to ensure that Giro is in a position to compete fairly with the clearing banks, and that it should not be subject to extra or onerous burdens of control, or other burdens, which the clearing banks do not have to face. It is in that sense that we have seen Giro as competing with the banks. It may well be a sensible and desirable move for Giro to publish separate report and accounts when its banking business has grown. It might well be right to meet the specialist interest in its banking services by publishing separately an expanded

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extract from its accounts which are presented in the Post Office's annual report, where I think they would always have to be presented.
While it would reduce costs not having to send out the Post Office's own report when somebody merely wanted to see how Giro was doing, I think that the noble Lord would agree that there is a counter-argument, that to produce separate report and accounts for Giro would increase the costs. I certainly do not rule out the production of a separate report and accounts, and it may well be something which Mr. Singer himself would welcome. I would suggest to the noble Lord that this is something which I could undertake to draw to the attention of Mr. Singer and the Chairman of the Post Office. He has very rightly raised it and I have considerable sympathy with it myself, as long as there is shown to be a clear demand for what the noble Lord is suggesting and it is not going to be too costly. However, I hope that, if I will undertake to draw it to the attention of Mr. Singer and the Chairman of the Post Office, the noble Lord will not feel it necessary to press the Amendment this afternoon.
Lord ABERDARE: I am grateful to the noble Lord. I think that that would be perfectly satisfactory. I would only suggest that the section on Giro should be separable so that at least it can be sent out separately, but not that anybody should go to the great expense of producing an entirely separate report
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from that in the major Post Office report. I should like to thank the noble Lord for the assurances that he has given me on various Amendments, and the trouble he has taken with these Amendments. I should also like to thank the noble Lord, Lord Caccia, for his support and assistance in the course of this quite interesting little Committee stage. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Remaining clauses agreed to.
House resumed: Bill reported without amendment.

PERSONAL STATEMENT
Lord WINTERBOTTOM: My Lords, with the leave of the House, may I make a short statement correcting something I said in answer to a Question by the noble Baroness, Lady Ward of Tyneside, earlier this afternoon? When I referred to a connection with the OECD and the United Nations, I should have said that the OECD is the commercial international body for the developed countries.

EDUCATION (SCHOOL-LEAVING DATES) BILL [H.L.]
Returned from the Commons agreed to with an Amendment; the said Amendment considered and agreed to.
House adjourned at seventeen minutes past six o'clock.