Sitting of 3 July 1978

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  ORAL ANSWERS TO QUESTIONS
  Mr. Speaker: I appeal to each hon. Member who asks a supplementary question to ask one that is in fact only one supplementary question. That will enable us to make better progress.
  ORAL ANSWERS TO QUESTIONS
    WALES

      County Hospital, Griffithstown
      Mr. Abseasked the Secretary of State for Wales why tenders for the needed extensions at the County Hospital, Griffithstown have been delayed three times; and what action is being taken to expedite the commencement of the required building work.
      The Under-Secretary of State for Wales (Mr. Barry Jones): The tenders were higher than we would have wished and
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      it was necessary to examine the reasons for this very closely. Within the last few days my right hon. and learned Friend has been able to give his approval and the building work will start very shortly.
      Mr. Abse: I thank my hon. Friend for his effective intervention, which I am sure will be much appreciated in Pontypool, where it is a matter of urgency that we have the new surgical units. Can my hon. Friend tell us the amount involved in these extensions to the hospital? May I also thank him for his intervention in education? This week Pontypool has certainly had a great deal to thank the Labour Government for.
      Mr. Barry Jones: I thank my hon. Friend. The total cost of the replacement operating theatre and the X-ray department will be nearly £1 million. My hon. Friend has campaigned for them for some years.

      Welsh Assembly (Elections)
      Mr. Knoxasked the Secretary of State for Wales what he expects the cost of the elections to the Welsh Assembly will be.
      The Under-Secretary of State for Wales (Mr. Alec Jones): The cost of the initial Assembly elections was estimated for the purposes of the Explanatory and Financial Memorandum to the Wales Bill as broadly £0·7 million.
      Mr. Knox: Would the cost of the elections be any different if they were conducted under proportional representation? Will the hon. Gentleman recommend to his colleagues that the amendment made in another place on that issue should be retained, because proportional representation is clearly a much fairer system of election than the first-past-the-post system?
      Mr. Alec Jones: As for the principle of proportional representation, an amendment has been passed in another place; but the Government and this House will be making their decision on all the amendments from another place very shortly. I have no figures for the relative costs of both systems. The hon. Gentleman must try to persuade the House in far stronger terms than those with which he tried on the last occasion.
      Mr. D. E. Thomas: In view of the comments made by some of his hon. Friends about the cost of the Assembly, will the Under-Secretary agree that £0·7 million is a very small price to pay for democratising government in Wales?
      Mr. Alec Jones: I certainly agree that £0·7 million is a small price to pay for the increase in democratic accountability, which is one of the main functions and purposes of the devolution Bill.
      Mr. Ioan Evans: Will my hon. Friend ensure that the Goverment reject the proportional representation amendment, because we should not try in such a Bill to change our electoral system? On the question of cost, have the Government any view on whether aid should be given to the two organisations that may well be set up to campaign for or against the Assembly?
      Mr. Alec Jones: If aid were to be given to various organisations, legislation would be needed. There is no provision for it in the Bill. I take my hon. Friend's point, that the House has already expressed its view on proportional representation. We now have merely to consider our attitude to the amendment carried in another place.
      Sir A. Meyer: Would not the hon. Gentleman agree, none the less, that proportional representation would ensure that there was a much fairer representation in the Assembly?
      Mr. Alec Jones: No, Sir.

      Unemployed Persons
      Mr. Michael Robertsasked the Secretary of State for Wales what representations he has received about the number of people unemployed in the Cardiff area.
      The Secretary of State for Wales (Mr. John Morris): As I informed the hon. Member on 3rd April, my hon. Friend the Member for Rhondda (Mr. Jones) received a deputation led by the Lord Mayor last November, and my Department has continued to keep in close touch with the local authorities. Several correspondents have also referred to this matter.
      Mr. Roberts: Does the Secretary of State accept the view of the Cardiff Chamber of Commerce that the disastrous decline in industrial jobs in Cardiff would best be reversed by small, labour-intensive units? Does he consider that the hope of reward in the form of tax cuts is essential to attract the entrepreneurs, including recently compensated redundant steel workers, into new businesses to create jobs for Cardiff?
      Mr. Morris: I am sure that the hon. Gentleman would be the first to welcome the enormous amount of money—£13 million—that the Government have made available to meet the results of the steel closures which have been accelerated. As regards tax cuts, my right hon. Friend the Chancellor of the Exchequer, in the last Budget, offered a great deal of assistance to small businesses. I am sure that that will have an effect.
      Mr. Roderick: Has my right hon. and learned Friend made an estimate of the additional numbers who would become unemployed in Cardiff and in Wales generally should the Tory Party's proposals for cuts in public expenditure be carried?
      Mr. Morris: It is not possible to make such an estimate. As I understand it, there is a fierce argument going on inside the Shadow Cabinet between the axe-men and those who are likely to be axed. The public expenditure cuts for which the Tory Party is looking seem to range from £2,500 million to £4,000 million. In any of these contingencies Wales, which is so dependent on public expenditure, would undoubtedly suffer terribly if we

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      had the misfortune of a Tory Government.
      Mr. Grist: Is the Secretary of State aware of the grave imbalance in Cardiff between the service and manufacturing sectors in employment? Will he take account of the fact that there is agreement between the Labour and Conservative Parties over the need for the movement of the Ministry of Defence to Cardiff, which is in contrast to the attitude taken by Plaid Cymru?
      Mr. Morris: I find it difficult to understand how anyone who cares for the future of Cardiff and who is aware of the need to provide more employment could oppose the decentralisation of Government Departments to Wales. We have a very good record in this respect with regard to Swansea, Cardiff and Newport. Both directly and indirectly, this proposal will prove to be a great help to the Cardiff area.
      Mr. Geraint Howells: Is the Secretary of State aware that the unemployment figure in Mid-Wales is very high indeed—
      Mr. Speaker: Order. This Question is to do with the Cardiff area.
      Mr. Wigley: Will the Secretary of State confirm that, by virtue of being the capital city of Wales, Cardiff has disproportionately more jobs in the Civil Service, in Government Departments and in the private sector than a city of similar size in the provinces of England? Will he therefore agree that, by creating more jobs, the Welsh Assembly will be for the benefit of the people of Cardiff?
      Mr. Morris: We need to bring more jobs to Cardiff generally, whether by way of Government dispersal, by way of Government assistance to meet the cost of steel plant closures, by development of the surrounding areas of Llantrisant or by the siting of Ford at Bridgend, within 20 miles of the city of Cardiff. In all of these ways we must continue the drive to ensure that there is an improvement in the job potential of Cardiff.
      Mr. Nicholas Edwards: The Secretary of State spoke of a bracket of £2,500 million to £4,000 million of possible public expenditure cuts. Since that was almost exactly the bracket which covered his own Government's public expenditure
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      cuts, forced on them by the IMF, may I ask him to tell us what effect those cuts had on unemployment in Wales?
      Mr. Morris: The unemployment figures in Wales are well known. If the hon. Gentleman will confirm that the activity now going on in the Shadow Cabinet means that it is trying to discover further public expenditure cuts, he should put a figure to this so that we know where we stand.
      Mr. Wyn Robertsasked the Secretary of State for Wales what are the latest figures for (a) males, (b) females and (c) school leavers unemployed in Wales.
      Mr. John Morris: This June there were 60,633 men and 25,901 women, totalling 86,534 unemployed in Wales. These figures include 6,307 school leavers.
      Mr. Roberts: Now that the Government have agreed, after a great deal of vacillation, not to impose the 2½ per cent. increase in the employers' national insurance contribution, may I ask the right hon. and learned Gentleman to have a look at other deterrents to employment such as the Employment Protection Act? If he does not believe me when I say that that Act is a deterrent, may I ask him to consult employers?
      Mr. Morris: The hon. Gentleman will have read some of the articles which have recently been written concerning the effect of the Employment Protection Act, showing that it has no significant effect upon the provision of jobs. I am sure that one of the greatest deterrents acting upon those who want to come to Wales is the fear that there may be a Tory Government who will want to impose cuts in the industrial assistance that we are giving and who will want to reduce the assistance that we are giving to job creation. People are also frightened that any chance of building the A55 in North Wales would disappear over the horizon if the Tory Party came into office.
      Mr. Roy Hughes: I appreciate that the problem of unemployment among school leavers is serious, but may I ask whether my right hon. and learned Friend has been able to work out any estimate of how this figure would increase if the Conservative Party's public expenditure proposals were implemented?
      Mr. Morris: That is not possible until the Tory Party manifesto sees the light of day and we know which side of the Shadow Cabinet has won. I want to know whether those who now occupy the Tory Front Bench are axemen or are liable to be axed. Then I would know what was likely to happen.
      Mr. Geraint Howells: While appreciating the problems of Cardiff, Mr. Speaker, may I ask whether the Minister is aware of the number of school leavers in Mid-Wales and the corresponding unemployment figure? Is he satisfied that the financial resources of the Development Board for Rural Wales are great enough to ensure that it can stem depopulation and create jobs for young people in the future?
      Mr. Morris: I am sure that the hon. Member welcomes the additional £700,000 which I announced last Wednesday for the Development Board for Rural Wales. It is up to the board to spend the money made available to it. If it were able to spend more, I would be most anxious to provide more money. Given the determination of the Manpower Services Commission and the resources provided to it and its area boards by the Government, I should like an indication from both sides of the House that the commission will be helped in its task of finding jobs or alternative occupations for young people this coming autumn.
      Sir Raymond Gower: Since the right hon. and learned Gentleman seems to be anxious about the possibility of trouble arising from cuts in public expenditure by a Tory Government, may I ask him to recollect that when taxation was severely cut by a former Conservative Chancellor—Mr. Butler as he then was—it was followed by a decade of unparalleled prosperity?
      Mr. Morris: The hon. Gentleman knows how little progress was made with the country's economy in those 13 wasted years. Will the hon. Gentleman help me? Will he give me some assurance before election day, whenever it comes, about which areas of public expenditure will suffer in Wales?
      Sir Raymond Gowerasked the Secretary of State for Wales what representations he has received concerning the
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      numbers of people unemployed within the county of South Glamorgan and in the town of Barry, respectively; and if he will make a statement.
      Mr. John Morris: I have received several representations relating to unemployment in South Glamorgan but no separate representations about unemployment in Barry—save that the hon. Member has another Parliamentary Question down today.
      Sir R. Gower: Is the right hon. and learned Gentleman aware that since the end of the last war the areas of South Glamorgan and the part around Barry have escaped the worst scourge of unemployment which has affected the valleys? Is he also aware that now, for the first time since the war, those areas are experiencing unemployment figures and problems comparable with the other areas? Will he take account of this fact when considering the allocation of grants and so on for Wales in the future?
      Mr. Morris: Certainly. I am well aware of the problem, and the worsening of the problem, since the accelerated closure of East Moors. That is why I am sure the hon. Gentleman would be the first to welcome the additional moneys—£13 million—that have been made available for assisting the very areas with which he is concerned.

      Welsh Language
      Mr. Gwynfor Evansasked the Secretary of State for Wales what steps he has taken actively to promote widespread public discussion on the recommendations in the report "Dyfodol I'r laith Gymraeg—A Future for the Welsh Language"; if he will call regional conferences to discuss the recommendations; and if he will make a statement.
      Mr. John Morris: The report has been given wide publicity and follow-up comment in newspapers and on radio and television. Written statements from interested bodies and individuals will be welcomed by my Department. I do not think that another round of conferences would carry matters further. It could only duplicate much of the useful work already carried out by the Council for the Welsh Language.
      Mr. Evans: Does the Secretary of State appreciate the desperate need for

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      the establishment of the permanent body which was recommended by the Council for the Welsh Language in view of the critical position of the Welsh Language? In particular, will he ensure that there is a speedy start on the recommendations affecting publicity, education for children under five years of age, television programmes for children and the use of the fourth channel in Wales for showing mainly Welsh language programmes?
      Mr. Morris: Having received the report of the council, I believe that it is right to await the reactions of a host of interested bodies throughout Wales. We should wait to see what people have to say. Broadcasting is a matter for my right hon. Friend the Home Secretary. He proposes to publish a White Paper on this. Dealing with aid for the Welsh language generally, I believe that this Government can hold their head high. Compared with a total of about £24,000 in 1973–74, this year—when we include the grant to the National Eisteddfod—we shall have gone over the £500,000 mark. This includes grants for Urdd Gobaith Cymru, the playgroups and also support for Welsh books. That is the significance of the support for the coming year.

      Land Authority Transactions
      Mr. Costainasked the Secretary of State for Wales how many acres of land have been bought by the Land Commission in Wales; how much has been sold to builders; and how many houses have been built on this land.
      Mr. Alec Jones: The land policy statement published by the Land Authority for Wales shows that the authority has acquired about 900 acres of land since it began trading in August 1976. Disposals to 31st March 1978 amounted to 227 acres, of which about 55 acres were for residential development. I understand that construction of dwellings has started on a number of sites and that completions have already been achieved on two; further details can be obtained from the Land Authority.
      Mr. Costain: With even that miserable record looking good beside the pathetic record of the English equivalent, as the Department of the Environment is apparently so proud of its efficiency as the worst Government Department, will the hon. Gentleman tell it how to get on
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      with its job, or abolish the Act and get rid of the Land Authority?
      Mr. Alec Jones: I do not agree with the hon. Gentleman's use of the word "miserable" to describe the activities of the Land Authority for Wales. I draw the hon. Gentleman's attention to an article in the Financial Times last Friday which paid tribute to the work of the authority, indicated that it had exceeded both its targets for acquisition and its targets for disposals, and added that it was popular with the building industry.
      Mr. Speaker: For the sake of the record, I should point out that it is not in order to ask Ministers to pass messages to other Departments.

      Advance Factories (Arfon and Dwyfor)
      Mr. Wigleyasked the Secretary of State for Wales what steps have been taken during the past four years by his Department or by agencies responsible to him to provide employment in the advance factories which are standing empty in the Arfon and Dwyfor areas.
      Mr. John Morris: My Department and the Welsh Development Agency do all they can, through advertising and personal contact, to impress on industrialists the advantages of the North Wales special development area, and of the four advance factories in Arfon and Dwyfor which are at present standing empty.
      Mr. Wigley: But would not the right hon. and learned Gentleman agree that these factories have been standing empty for far too long, and that those initiatives which have shown any enterprise in them have come mainly from local enterprises, county, borough and district councils and not from the Welsh Development Agency? In the circumstances, will be instruct the agency to attract industry to this area of high unemployment?
      Mr. Morris: The hon. Gentleman knows that it is not within the power of the agency to direct industry. The hon. Gentleman referred to empty factories. One at Arfon and one at Dwyfor have been brought to the attention of 126 industrialists and have been visited by seven. One of the factories is subject to

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      two applications, which are being considered. I am sure that the hon. Gentleman will be pleased that the large adcance factory at Blaenau Ffestiniog and two units at Penrhyndeudraeth in Gwynedd have recently been allocated after a great deal of effort, going back, certainly as far as the Blaenau Ffestiniog factory is concerned, for many years.
      Mr. Ioan Evans: Will my right hon. and learned Friend continue the policy of building advance factories prior to requirement, because sometimes incoming industrialists want factories immediately? Will he tell the WDA that that is a method of attracting a great deal of industry into Wales at a time of serious world recession?
      Mr. Morris: I am grateful to my hon. Friend for his remarks. There has been an enormous increase in lettings. As I told the Welsh Grand Committee only last Wednesday, the rate is averaging about four a week. I will certainly continue the programme of building advance factories. More than 400 have been announced, and the programme will be continued because they are needed. The availability of advance factories is one of the most significant factors for industrialists when deciding whether to move to a certain area.

      Devolution (Referendum)
      Sir A. Meyerasked the Secretary of State for Wales if he will make a statement on current progress towards arrangements for a referendum on devolution.
      Mr. Alec Jones: Under Sechedule 12 to the Wales Bill, a draft order making provision for the conoduct of the referendum must be laid before Parliament and approved by resolution of each House.
      Sir A. Meyer: Since the Government, for reasons of electoral expediency, are now following the lead given, with totally misguided conviction, by Plaid Cymru, does not the hon. Gentleman agree that the voters who consider the scheme for an elected Welsh Assembly both expensive and impractical have no other recourse than to vote Conservative?
      Mr. Alec Jones: Anyone who gives advice to the people to vote Tory at the next election must want his head
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      examined. On the question of an elected Assembly for Wales, I remind the hon. Gentleman that the Labour Party in Wales was on record, long before there was a Plaid Cymru Member of Parliament, as calling for a directly-elected Assembly because we saw it as an extension of democracy—a word not exactly popular with the Conservative Party.
      Mr. D. E. Thomas: Has the hon. Gentleman's Department or any other Department yet had discussions with the broadcasting authorities about their intensions in the coming devolution referendum? How is the balance of views to be controlled on programmes broadcast into Wales by Granada Television, Westward Television, and so on?
      Mr. Alec Jones: The question of equity in broadcasting is a matter for the broadcasting authorities themselves. I am sure that they will note the hon. Gentleman's supplementary question.
      Mr. Abse: In order to dispel the view that the only way to prevent the Welsh Assembly is to vote Tory at the next election, may I ask my hon. Friend to make it clear that, by voting for very many Labour Members in Wales, not to mention some silent Ministers, the voters can be assured that there will be a vigorous fight in this House and in the referendum to ensure that, with Labour electors' support, there will be no Welsh bureaucratic Assembly?
      Mr. Alec Jones: I think that the proper body to decide whether there shall be an elected Assembly for Wales is not a few odd people on either side of the House but the people of Wales themselves, and this House will, I hope, give them the opportunity to do that through the referendum.

      Nominated Bodies
      Mr. Ioan Evansasked the Secretary of State for Wales what representations he has received regarding the future of the nominated bodies in Wales.
      Mr. Alec Jones: None in recent months, Sir.
      Mr. Evans: Is my hon. Friend aware that there is some confusion over whether, if the Assembly is created, the nominated bodies will cease to exist or will continue with the Assembly? Whether

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      or not the people vote for an Assembly, the composition of these nominated bodies is causing some concern. There are accusations that these bodies are dominated by Labour or, on the other hand, that not sufficient Labour representatives are on them. Will my hon. Friend look into the question of how—irrespective of the Assembly—we can get the nominated bodies to be more representative of the people of Wales?
      Mr. Alec Jones: It was an essential part of the devolution proposals that we should make the nominated bodies more democratically accountable. It is also true to say that amendments have been made in another place which are having some impact on that intention. We shall have to take account of those amendments. It is true that reference is frequently made to the composition of nominated bodies in Wales. But when one is attacked on one side for doing too much of one thing and attacked on the other side for doing too much of another thing, perhaps sitting somewhere in the middle is as near comfort as is possible.
      Mr. Gwynfor Evans: Is the hon. Gentleman aware that we on this Bench believe that the question of making the nominated bodies accountable to the Welsh Assembly is one of the most attractive features of the Government's devolution policy?
      Mr. Alec Jones: I am glad to hear the hon. Gentleman say so. It was the composition of such bodies—I am not referring to the people personally—that produced these fears.
      Mr. Nicholas Edwards: Recently in the Welsh Grand Committee, the Minister spoke of the desirability of keeping the Arts Council at arm's length from Government and avoiding any Government domination of the arts. Is he not therefore a little concerned by the revelation of Lord Donaldson of Kingsbridge in another place that the arts in future may be in the hands of a Department of Culture?
      Mr. Alec Jones: Fortunately, I am not responsible for what is said in another place, hut, having heard the hon. Gentleman's criticisms of the composition of nominated bodies, I was fascinated to hear that the Tory Party is drawing up a "good and great" list of
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      individuals sympathetic to the Tory cause who might serve on these nominated bodies.
      Mr. Edwards: Will the hon. Gentleman answer my question about the Arts Council, which he has not even referred to?
      Mr. Alec Jones: We had a long debate on the work of the Arts Council in Wales in the Welsh Grand Committee, when the hon. Gentleman implied that my right hon. and learned Friend was responsible for appointing Labour members as chairmen of panels. In fact, my right hon. and learned Friend is not responsible for appointing these chairmen.
      Mr. Roy Hughes: Will my hon. Friend confirm that it is his impression that nomination to these so-called bodies has been one of the means over the years whereby the Tory Party has been able to exercise a certain control over the length and breadth of Wales, despite being repeatedly defeated at the polls?
      Mr. Alec Jones: I go further. I believe that it is far more than an impression it is a fact.

      Inner Cities
      Mr. D. E. Thomasasked the Secretary of State for Wales which local authority areas in Wales he has selected for partnership or other special programmes of action following the publication of Command Paper No. 6845, "Policy for the Inner Cities".
      Mr. Alec Jones: I refer the hon. Member to the answer given by my right hon. and learned Friend to my hon. Friend the Member for Swansea, East (Mr. Anderson) on 19th May when he explained that he intends to designate five areas under the Inner Urban Areas Bill, should it be enacted. The five areas are Blaenau Gwent, Cardiff, Newport, Rhondda and Swansea.
      Mr. Thomas: I accept that information, but would not the Minister agree that the Welsh Office is not displaying the kind of coherent, concerted approach towards inner urban problems that is being displayed by the Department of the Environment in England?
      Mr. Alec Jones: No. What my right hon. and learned Friend has done in this case is to say that we accept that there

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      are many communities in Wales which need special help under this sort of programme, but our aim in designating these five areas was to try to ensure that we could help those with the worst problems, both in scale and in intensity.
      Mr. Grist: In view of the fact that the original Act brings in only £80 million over four years, can the Minister say how much money will actually be made available to the Cardiff area?
      Mr. Alec Jones: It is not possible to make that sort of statement at present, because we have already decided that we shall hold consultations with the local authority associations to see how the extra money which will be available next year for the urban aid programme can best be used to deal with the problems not only in Cardiff and the other four areas but in the whole of Wales.

      M4 (Beechwood Estate, Newport)
      Mr. Roy Hughesasked the Secretary of State for Wales if he will erect a sound barrier on the M4 motorway adjoining the Beechwood Estate, Newport, Gwent in order to prevent further noise nuisance and damage to property.
      Mr. Barry Jones: The need for a sound barrier and other noise insulation measures in connection with the widening of the M4 will be considered during the design phase of the scheme for widening the M4 motorway between Coldra and Malpas. Work on this scheme is not expected to start before 1980.
      Mr. Hughes: I agree with the widening of the M4, which is absolutely necessary to the development of the Welsh economy, but will my hon. Friend appreciate that the people of the Beechwood Estate have suffered very much and have been very modest in their demands? Will he therefore ensure that in the future development of the motorway the erection of the sound barrier which those residents are now requesting is carried through?
      Mr. Barry Jones: My hon. Friend has raised the question of the Beechwood Estate before. At present we have no powers to provide the insulation in respect of the road as it is at present. However, I shall look very carefully at the matter in the context of the future scheme.
      Sir A. Meyer: Will the hon. Gentleman ensure that resources are not diverted from the top priority of improving the A55 in North Wales?
      Mr. Barry Jones: I can assure the House that the availability of funds in relation to the development of roads in Wales will ensure that there is a fair share for North Wales.

      Job Creation
      Mr. Nicholas Edwardsasked the Secretary of State for Wales, out of the total of 63,000 jobs that he told the Welsh Grand Committee had been provided in Wales by Government special measures over a period of years, what is the maximum that he estimates have been provided at any one time; and how many he calculates are being provided at the moment.
      Mr. John Morris: The best estimate available is that in June about 310,000 people in Great Britain were being assisted, out of a cumulative total of about 900,000 people since 1975. Assuming the same proportion in Wales, the equivalent figure is about 21,000.
      Mr. Edwards: Is not it misleading for the Secretary of State to talk of the 63,000 jobs that have been saved in Wales over a period of years when it is now clear that only a comparatively small fraction of the total is saved at any one particular moment? Would not it be more honest and informative to give the figures on exactly the same basis as those for unemployment, namely, those on the register as actually employed at any particular moment in time?
      Mr. Morris: I do not think it is misleading at all. These figures arise because some schemes start at different dates. People come in through the temporary employment subsidy and then the schemes come to an end. We have given this estimate of the number of jobs that have been saved over a period. It is not helpful to use the word "dishonest". Perhaps the hon. Gentleman might consider axing whoever briefs him because, perhaps on a very good briefing from Conservative Central Office, he seeks to add the number of people unemployed in Wales to the 60,000 jobs that have been saved in order to indicate that there are 150,000 people in Wales without jobs.
      Mr. Wigley: Does not the Secretary of State accent that with 90,000 people unemployed in Wales it would be far better to use them to build houses which are needed for people on council house waiting lists, to improve the 107,000 houses which are unfit and to build the many miles of motorway which are needed in Wales rather than paying them about £80 a week on average, taking all the benefits together, for staying on the dole?
      Mr. Morris: I would be the first to agree with the hon. Gentleman that one would have hoped that more houses would have been built in Wales in the last two years. Increased resources were made available over a two-year period—significant amounts of money were made available—but regrettably and unhappily those resources were not taken up. If they had been, they would have had an effect on unemployment.

      Wales Trades Union Congress
      Mr. Gristasked the Secretary of State for Wales when he next expects to meet the Wales Trades Union Congress.
      Mr. John Morris: I met representatives of the Wales TUC last Wednesday.
      Mr. Grist: When the Secretary of State next meets the Wales TUC, either as Secretary of State or as a party leader in Wales, will he work out with it how an extension of nationalisation and State control, according to the Labour Party programme, can actually save and create jobs in Wales as opposed to losing jobs, which it seems to have done over the last 20 years?
      Mr. Morris: I doubt whether the hon. Gentleman has ever met the Wales TUC, But I can assure him that it is in the lead in making proposals both to save jobs and to ensure that there is a better balance of employment in Wales. I am most grateful to the Wales TUC for its co-operation—
      Mr. Nicholas Edwards: It is a pity that the figures get worse and worse all the time.
      Mr. Morris: Perhaps the hon. Gentleman will contain himself. I am most grateful for the co-operation of the Wales TUC as well as that of employers' organisations.
      Mr. D. E. Thomas: Will the Secretary of State take this opportunity of assuring the Wales TUC, and those of us who will be attending the one-day conference on industrial-related diseases to be held by the Wales TUC at Llanberis next Friday, of the support of his Department for initiatives to establish a compensation fund for slate quarrying?
      Mr. Morris: I have listened to the representations that have been made, and I am very concerned indeed, as is my hon. Friend the Minister of State, Department of Employment. The Wales TUC is very concerned about these issues, as I am. It would bring enormous relief to the Wales TUC if it could be reassured that there would not be a Conservative Government and if hon. Members who are now on the Conservative Front Bench made it clear whether they were axemen with regard to public expenditure in Wales.

      Bilingual Schools
      Mr. Geraint Howellsasked the Secretary of State for Wales how many children attend bilingual schools in Wales.
      Mr. Barry Jones: In January 1978, the 60 schools in Wales that are officially designated as bilingual had 15,640 pupils. These figures do not include schools in Welsh-speaking areas that are, to a greater or lesser extent, bilingual in character.
      Mr. Howells: I am delighted that so many children in Wales attend bilingual schools. I am sure that the Under-Secretary of State will agree that it would be a wonderful achievement if all Welsh children were able to have bilingual education by the end of this century. What further plans has he to help local education authorities in the future?
      Mr. Barry Jones: I hope that I can please the hon. Gentleman by telling him that the number of pupils attending designated bilingual schools has risen by 87 per cent. since 1970. As to the future, we have asked local education authorities for detailed information about their present policies and practices as part of the wide-ranging curriculum review. When we receive that sort of information, my right hon. and learned Friend and I will want to consider what further

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      guidance and advice we shall give to the local education authorities.
      Mr. Gwynfor Evans: Will the Minister remind the Welsh local education authorities of the consensus that two-stream schools have not proved as successful as schools which are one community, particularly from the standpoint of the Welsh language? Wherever the Welsh language is used as a medium, will he press those authorities to do so through Welsh medium schools?
      Mr. Barry Jones: May I outline briefly but bluntly the policy as we see it? It is my right hon. and learned Friend's policy to encourage the local education authorities to make bilingual provision which is in keeping with the linguistic characteristics of their areas as well as having regard to parents' wishes. We do not bully the local education authorities. They have a fair amount of leeway to make up their own minds. However, the Department is not insensitive to the point of view which the hon. Gentleman has expressed.
      Mr. Wyn Roberts: Can the Minister say why only one local education authority has submitted a statement on its linguistic policy as requested by June this year?
      Mr. Barry Jones: These statements will be made quite soon.

    CIVIL SERVICE

      Trade Unions
      Mr. Skinnerasked the Minister for the Civil Service when he next expects to meet leaders of the Civil Service trade unions.
      Mr. Molloyasked the Minister for the Civil Service when he expects next to meet the representatives of Civil Service trade unions.
      The Minister of State, Civil Service Department (Mr. Charles R. Morris): I am in regular contact with representatives of the Civil Service unions.
      Mr. Skinner: Will the Minister discuss with the trade unions the question of who decides the so-called "first division" of the Civil Service—the top 3,000 or so? Is he aware that between 1971 and 1975
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      the number of applicants from Oxford and Cambridge was 25 per cent. of those applying, yet more than 50 per cent. were accepted? This is bound to be the case when there is a majority of full-time civil servants on the selection panel. Will the Minister tell the Prime Minister, who seems to be drawing up the Labour Party manifesto these days, that we want to see a greater degree of accountability and democracy in the selection of these top posts?
      Mr. Morris: On the selection of entrants to the administrative trainee grade of the Civil Service, I accept my hon. Friend's general contention that there appears to be a statistical bias in favour of what I would call Oxbridge entrants. But the fact remains that, while not all of our most able people come from Oxford and Cambridge, the figures provided for the Expenditure Sub-Committee demonstrate that these universities still attract more than their share of able school leavers, measured by A-level grades obtained. I am satisfied that the Civil Service Commission operates in a wholly impartial manner in the selection process.
      Mr. Molloy: When my right hon. Friend next meets the Civil Service staff side and the Civil Service Union in particular, will he have further discussions on the subject of dispersal? This is causing a great deal of concern particularly among those civil servants who must uproot their homes to go to other parts of the country. Often they have teenage children and are moving to areas of high unemployment. Their movement there does not help to create employment. Will my right hon. Friend have more talks and ensure that people are able to volunteer whenever they can to take part in dispersal operations?
      Mr. Morris: I am happy to meet any of the Civil Service unions on the question of dispersal. I understand the difficulties for individual civil servants in London and the South-East, but I assure my hon. Friend that it is hoped that Government policy will operate on a wholly voluntary service.
      Mr. Rhodes James: First, may I say that we are all very pleased that the hon. Member for Bolsover (Mr. Skinner) has returned? He has a great deal of respect and affection on this side of the House.

      21
      Does the Minister agree that a well-paid, fairly-treated and respected Civil Service with a high morale is vital to the economic revival of this country, particularly in the elimination of waste in public expenditure? Is he aware that many hon. Members on this side of the House share his concern about the maintenance and expansion of an efficient and high-morale Civil Service?
      Mr. Morris: I am very grateful for the hon. Member's comments. I share his views about the wholly regrettable absence of my hon. Friend the Member for Bolsover (Mr. Skinner). However, my hon. Friend is here so often that I did not notice that he had been away.
      Mr. Speaker: Without offence to the hon. Member for Bolsover (Mr. Skinner), I want to second what has been said by the hon. Member for Cambridge (Mr. Rhodes James).
      Mr. Ioan Evans: When my right hon. Friend meets the Civil Service trade union leaders, will he allay the fears aroused by the Leader of the Opposition that a future Conservative Government would be prepared to restrict Civil Service and public service wages but to leave the private sector alone? Although this is an academic proposal, I still hope that my right hon. Friend will allay their fears.
      Mr. Morris: I feel that the Leader of the Opposition made a monumental gaffe in her Penistone speech when she outlined the Tory Party's approach to pay policy and suggested that the Civil Service, the nationalised industries and the public sector generally should be restrained by strict cash limits. That policy would involve double standards and discrimination against 6 million workers.
      Mr. Tim Renton: In his discussions with the relevant trade union leaders, has the Minister given thought to the question whether Civil Service inflation-proof pensions should be funded? These pensions form an increasingly important part of the total remuneration of civil servants. Is it not an anomaly that they are not funded for civil servants but are funded for local authorities' and nationalised industries' employees?
      Mr. Morris: I do not wholly accept that it is anomaly as such. It is true that Civil Service pensions are not
      22
      funded, but I do not think that that is an anomaly.

      Civil Servants
      Mr. Adleyasked the Minister for the Civil Service by how many the Civil Service has increased or decreased since February 1974.
      Mr. Charles R. Morris: Although there were 38,000 more Civil Service staff in post on 1st April this year than on 1st March 1974, the nearest available dates, decisions taken by the Government to contain the size and cost of the Civil Service have caused a reduction in Civil Service numbers of nearly 12,000 since April 1976. This represents a saving of some £65 million, which has been achieved despite increasing workloads in some Departments caused by changes in taxation and unemployment levels.
      Mr. Adley: The Minister has announced an increase of 38,000 civil servants. Will he accept my congratulations for ensuring that the Government have shielded their own employees from the hardship of unemployment which has hit the rest of the community? It will be noted that the Government's ability to increase the number of their employees is in line with their ability to increase unemployment, inflation, taxation, food prices and a whole host of other items. Will the right hon. Gentleman tell us what benefit the taxpayers can expect from an additional 38,000 civil servants?
      Mr. Morris: I believe that the hon. Member prepared that supplementary question without listening to my answer. I indicated that since 1976 we have achieved a reduction of 12,000 civil servants and a financial saving of £65 million.
      Mr. Wrigglesworth: Does that fact not only nail the lie that the Civil Service complement is constantly increasing but make clear to the House and the country that any increase in the number of civil servants follows actions taken by this House in passing legislation and calling upon Government Departments to carry out responsibilities that hon. Members want to be carried out? Those who criticise any increase in the number of civil servants should do something about it here instead of constantly asking for more Government support.
      Mr. Morris: My hon. Friend is right. The size of the Civil Service is determined by the tasks imposed upon it by decisions of this House.

      Closed Shop
      Mr. Gowasked the Minister for the Civil Service whether he will make a statement about the Government's policy towards a closed shop in the Civil Service.
      Mr. Wrigglesworthasked the Minister for the Civil Service if he has made any progress in his discussions with Civil Service trade unions about the provision of closed shop agreements.
      Mr. Charles R. Morris: Discussions have taken place with both the industrial and non-industrial unions which have asked for union membership agreements. Proposals have been put on behalf of Ministers and there have been full and frank exchanges of views. The discussions are continuing, however, and I would not wish to prejudice their outcome by commenting on their content at this stage.
      Mr. Gow: Will the Minister accept that the introduction of closed shop agreements in the Civil Service would be deeply offensive to the people of this country? Will he confirm from the Dispatch Box that the Government are opposed in principle to the imposition of a closed shop in the Civil Service?
      Mr. Morris: I am aware of the strength of feeling not only in this House but in the country generally on the question of union membership agreements. If we can continue the discussions with the unions, which are proceeding in a spirit of reasonableness and moderation, we can arrive at something.
      Mr. Wrigglesworth: Will the Minister accept that, although many of us think that this is a matter that should be agreed by discussion and negotiation, there are, nevertheless, very strong feelings about this issue among the Civil Service trade unions? Will he pay close attention to the debates that took place at recent conferences and to the resolutions carried to ensure that the full views of the union members, who work so hard for better conditions, improved pay and better contracts in the Civil Service, are listened to by the Government?
      Mr. Morris: I can give my hon. Friend that assurance.

      WALES (REFERENDUM)
      Mr. Ioan Evansasked the Lord President of the Council if he will make a statement on progress with arrangements to hold a referendum on the proposals to create an Assembly in Wales.
      The Minister of State, Privy Council Office (Mr. John Smith): I have nothing to add to the reply given earlier to the hon. Member for Flint, West (Sir A. Meyer) by my hon. Friend the Under-Secretary of State for Wales.
      Mr. Evans: Has my right hon. Friend considered the allocation of financial resources to those who will be campaigning for and against the Assembly, or are no funds to be made available? If that is the case, will he consider contacting the broadcasting media, the BBC and the IBA to ensure that there is fair play for both sides in the run-up campaign to the referendum?
      Mr. Smith: The Government have already made clear, both in this House and in another place, that they have no intention of providing subventions to campaign organisations on either side of the referendum question. Indeed, legislation would be required for that purpose, and no amendments have been moved either in this House or in another place.
      The other matter raised by my hon. Friend is one for the broadcasting authorities, which have an obligation to ensure impartiality in the coverage of the subject. I am sure that they will pay attention to the views of both sides of the argument that there should be fair representation.
      Mr. Brittan: Does the right hon. Gentleman agree that it is not only necessary for the Government to avoid supporting outside bodies, but that it is essential for the Government not to spend taxpayers' money supporting one side in a highly controversial campaign? Will he assure the House that the Government do not intend to use their resources and taxpayers' money in support of the "Yes" campaign, and that they will accept that it is right that there should be legislation making clear that that cannot be done?
      Mr. Smith: On the latter point, I think that the hon. and learned Gentleman is anticipating matters which may be engaging the attention of the House at a later stage. Perhaps it will be better for the House to listen to the arguments then. The Government have made it quite clear that they will campaign for a "Yes" vote in the referendum, because that is the policy of the Government and it is the policy in our manifesto on which we were elected. We have made it equally clear that we will not provide money to either side of the campaign.

      REGISTER OF MEMBERS' INTERESTS
      Mr. Rookerasked the Lord President of the Council if he has any further proposals for amending the rules governing the Register of Members' Interests.
      The Lord President of the Council and Leader of the House of Commons (Mr. Michael Foot): I think that in the first instance the House would look to the Select Committee on Members' Interests for further proposals.
      Mr. Rooker: That answer is unacceptable. Will my right hon. Friend accept that the Government have failed in their manifesto commitment to have a genuine Register of Members' Interests until he takes action to meet the case of the right hon. Member for Down, South (Mr. Powell)? Until we have legislation on this matter, does he not agree that we shall not get local authorities to follow the lead that was supposed to be set by this House?
      Mr. Foot: I do not accept that we have gone back on our manifesto commitment, because the register is still compiled. There was a recommendation from the Select Committee on the subject, which I do not regard as a sensible way to deal with the matter. However, that does not alter the fact that the register is still being compiled.
      Mr. Nicholas Edwards: But, as the Lord President has said that he does not regard this as a sensible way to deal with the matter, does he after this long interval propose to give the House time to consider the matter and the report of the Select Committee?
      Mr. Foot: Of course there is a case for the House to consider the matter, but the House has had a number of other more pressing matters to discuss. The principle of the register has been accepted by the House and the register is sustained. I believe that that is the most important aspect of the matter. But at some stage no doubt there will be some further discussion in the House on the subject.
      Mr. Skinner: In considering the time that would need to be allocated to this issue, will my right hon. Friend bear in mind that it would take only a relatively short time, since almost every Member of the House, with the exception of the right hon. Member for Down, South (Mr. Powell), has agreed to the principle of the register? Therefore, the matter will be almost unanimous and could be disposed of in a few hours.
      Mr. Foot: I do not think my hon. Friend is correct in that matter because the recommendation of the Committee on the subject raises quite different issues involving how the matter should be dealt with. I do not believe that it could be disposed of in the way my hon. Friend suggests. I do not think it right that the House should dispose of an issue involving censure of a Member in that way.
      Mr. Anthony Grant: In view of all the other pressing commitments which the Government and the House have before them, will the right hon. Gentleman undertake to waste not one second more time on such an utterly trivial matter?

    HOUSE OF COMMONS

      Badge Messengers (Uniform)
      Mr. Onslowasked the Lord President of the Council what consultations were held before a decision was taken that Badge Messengers of the House should wear new summer uniforms.
      Mr. Foot: My office was consulted before the decision was taken.
      Mr. Onslow: If the Lord President thinks that an Eton jacket is a suitable working uniform for a grown man, will he tell us when we may have the pleasure of seeing him turn up here in one himself? In the meantime, will he confirm that, if the Badge Messengers have strong views on the matter, it is open to them

      27
      to make representations to the effect that the uniform should be withdrawn?
      Mr. Foot: The Badge Messengers can make any representations they wish. The matter was only proceeded with because the Serjeant at Arms had consultations with them and with Mr. Speaker. As for the first part of the hon. Gentleman's supplementary question, I think that the House will treat it with the derision it deserves.

      MACHINERY OF GOVERNMENT
      Mr. Skinnerasked the Lord President of the Council what representations he has received regarding machinery of government.
      Mr. Foot: I cannot recall receiving such formal representations but, like many Members, I am often made aware of people's views on how we should be governed.
      Mr. Skinner: Will my right hon. Friend accept that the machinery of government would work much better if the House of Lords were abolished, if we got rid of the Honours List, if we removed a lot of the patronage from the Prime Minister and other Cabinet Ministers, including my right hon. Friend the Lord President, and if we took away some of the power that is now being used by top civil servants? Has he taken account of the references made by Lord Armstrong on the miners' dispute in 1973–74 when Lord Armstrong seemingly advised the then Tory Prime Minister on the date of the General Election, and also of the recent remarks by Sir Antony Part at the Department of Industry? Bearing those matters in mind, does my right hon. Friend think that it is high time that they were removed from the political arena?
      Mr. Foot: I agree with my hon. Friend in some of his earlier comments. I, too, have always been in favour of the abolition of the House of Lords, and I remain in favour of that proposition. There are some other aspects of the matters mentioned by my hon. Friend which are of first-class public importance, but I do not think they can be dealt with by question and answer now. I have also read the comments made by Lord Armstrong in the broadcast to which my hon. Friend referred. They were remarkable utter-
      28
      ances, but again I do not think they can be dealt with by question and answer now.
      Sir John Rodgers: May I ask the Lord President whether his brothers agree with his point of view about the House of Lords?
      Mr. Dalyell: Will my right hon. Friend give more attention than the Brewers Society might give to the Band of Hope to the views of Lord Scarman and Lord Wilberforce that the right hon. Gentleman's Scotland Bill will not be workable in the absence of a constitutional court?
      Mr. Foot: There are other Lords who took a very different view from those cited by my hon. Friend. The House, according to its normal procedure, will be taking account of the amendments passed in the Lords. Some of those amendments should be accepted by the House and it would be wise for us to accept them, but many of the others should be treated in the manner referred to in the earlier part of the question. I seem to recall that my hon. Friend the Member for West Lothian (Mr. Dalyell) may have taken his quotation from somewhere.

SCOTLAND BILL (AMENDMENTS)
Mr. Adleyasked the Lord President of the Council what recent representations he has received concerning the amendments made to the Scotland Bill.
Mr. John Smith: Recent representations have been concerned mainly with the referendum, with transport and with the Tweed box.
Mr. Adley: Does the right hon. Gentleman recall that on two occasions in this House we tried and failed to discuss the Government's proposals on the change in the constitution of the British Tourist Authority? Does he not agree that this matter concerns the whole of the United Kingdom, and will he give an assurance that the House will have an opportunity to discuss this important matter before the Bill leaves the Commons?
Mr. Smith: I, too, regretted the fact that we were not able to discuss this matter when we dealt with the Bill

29
earlier. However, the Government, in response to representations, tabled an amendment in another place to increase to nine the membership of the British Tourist Authority. I believe that that is a reasonable compromise between the competing interests in this instance. I hope that it will be endorsed by this House.

DEVOLUTION (REFERENDUMS)
Mr. Wigleyasked the Lord President of the Council if he will now indicate approximately when the Government hope to hold the referenda on devolution in Wales and Scotland.
Mr. John Smith: I refer the hon. Gentleman to the reply I gave earlier to my hon. Friend the Member for Aberdare (Mr. Evans).
Mr. Wigley: Will the Minister give an assurance that, if the Scotland Bill and the Wales Bill are on the statute book before the end of this Session, before the Session ends he will have announced the date of the referendums?
Mr. Smith: It is impossible for anyone on this side of the House to predict when we shall be in a position to make announcements or statements of any sort. The House still has a considerable way to go in dealing with these Bills.
Mrs. Bain: Is not one of the reasons why the Government are not prepared to announce the date of the referendums that they still have not made up their mind about the anomalies that persist as a result of the House passing the 40 per cent. minimum requirement?
Mr. Smith: As the hon. Lady knows, we are considering that matter and seeking to make the best we can of the unfortunate decision arrived at by the House. On the subject of people making up their minds, I wish that the hon. Lady would explain to the people of Scotland why she continually votes against the Government on motions of confidence when only this Government can ensure that there is devolution.
Mr. Dalyell: Can my right hon. Friend clarify his phrase "seeking to make the best…of the unfortunate decision"?
Mr. Smith: My hon. Friend will get an opportunity to consider it further. What I intended to convey and what my words clearly conveyed, was that we are trying to make sense out of a decision which, on the face of it, causes some difficulty. My hon. Friend should not be too conspiratorial. There is quite an innocent explanation for the phrase, and he must not think that every word must be read as if it carried some Levantine intent.

SCOTLAND BILL (PROCEDURE)
Mr. Brittan: On a point of order, Mr. Speaker. I wish to raise the intolerable situation that has arisen in relation to the handling of the Scotland Bill later this week. Tomorrow evening the House will be asked to pass a further timetable motion on the Scotland Bill, yet the arrangements that the Government wish to put to the House for dividing the time that will be made available if that motion is passed are still not available to the House.
What is worse, it is proposed, whether the timetable motion is passed or not, that on Thursday the House should consider Lords amendments to the Scotland Bill. That means that if amendments to those amendments are not to be starred, they have to be put down by tomorrow—but the Lords Amendments are not available in the Vote Office today.
This attempt to bulldoze these measures through the House is unacceptable. Can anything be done to enable the House to have the necessary documentation in time for proper consideration and for amendments to be put down in time?
The Lord President of the Council and Leader of the House of Commons (Mr. Michael Foot): Further to that point of order, Mr. Speaker. I fully understand the desire of the House that the motion should be on the Order Paper and that the House should have proper time to consider it. We shall be putting it down today.
The hon. and learned Member for Cleveland and Whitby (Mr. Brittan) should be a little less impatient. [HON. MEMBERS: "Why?"] Because if he looked up what happened on some previous Lords amendments to various

31
measures he would discover that we are acting in conformity with what has been the practice on previous occasions. That is why he should be a little more careful about using such words as "intolerable" and "unacceptable".
Of course we want to make the motion available for hon. Members to consider. Of course we shall be able to consider it properly tomorrow. The hon. and learned Gentleman should not cast aspersions on the way in which we shall be able to proceed with the matter on Thursday. We are seeking to deal with the whole question. We want to get the motion on the Order Paper today. If the hon. and learned Gentleman will spend the afternoon looking up what previous Goverments have done in such matters he will discover that we are acting in full accordance with the timetables that prevailed on previous occasions.
Mr. Brittan: When will the Lords amendments be available?
Mr. Speaker: Order. We cannot debate that matter now. Mr. Rooker, on a point of order.
Sir David Renton: Further to the point of order raised by my hon. and learned Friend the Member for Cleveland and Whitby (Mr. Brittan)—
Mr. Speaker: Order. The hon. Member for Birmingham, Perry Barr (Mr. Rooker) gave me notice of a point of order. I shall come back to the right hon. and learned Member for Huntingdonshire (Sir D. Renton).
Later—
Sir David Renton: Further to the point of order raised by my hon. and learned Friend the Member for Cleveland and Whitby (Mr. Brittan), I wonder whether the Leader of the House could help us further in this matter. I am sure that the right hon. Gentleman will appreciate that we cannot either sensibly prepare our own amendments to the Lords amendments or form a judgment on the timetable motion which the Government are to table until we know what are to be the Government's amendments to the Lords amendments. When will they be tabled?
Mr. English: Further to that point of order, Mr. Speaker. Can you refresh my memory? Am I correct in believing that
32
their Lordships are entirely responsible for delivering their decisions to this House? Is it not true that they have about 260 amendments, not 150 as has been reported, and is it possible that the delay in our receiving their amendments is not unintentional?
Mr. Speaker: It is clear that I cannot answer these questions on points of order. I cannot refresh the memory of the hon. Member for Nottingham, West (Mr. English). He had better look to another source.

PALACE OF WESTMINSTER (POLITICAL LITERATURE)
Mr. Rooker: I am grateful to you, Mr. Speaker. I wish to raise a point of order concerning the displaying of political literature and banners on the railings outside the House by an organisation of building industry employers attacking the Labour Party. [HON. MEMBERS: "Oh."] Of course, if trade unions displayed such banners Conservative Members would be the first to complain.
As far as I am aware, it is not normally approved procedure for political literature to be displayed on the precincts of this place. I hope that you will have a word during the day with the authorities of the House.
Mr. Speaker: I shall certainly look into that matter.
Mr. Ronald Bell: Further to that point of order, Mr. Speaker. Have you noticed the political literature being displayed in Westminster Hall at the moment?

THEFT BILL [Lords]
Mr. Adley: I wish to raise a point of order on behalf of my hon. Friend the Member for Flint, West (Sir A. Meyer) and myself, though it may be that you, Mr. Speaker, will tell me that I should aim my question in another direction.
My hon. Friend and I both spoke on the Second Reading of the Theft Bill [Lords], which is a non-controversial measure in party terms, and we had both hoped to be selected for the Standing Committee. We were surprised and disappointed to find that, in spite of our speeches, neither of us had been selected.
Mr. Speaker: May I say to the hon. Gentleman that, in accardonce with Standing Order No. 40, the Bill stood committed to a Standing Committee for its Committee stage after Second Reading. Members of the Committee were nominated by the Committee of Selection on 7th June and a note to that effect apppeared in the Votes and Proceedings. The Standing Committee met on 27th June.
Before I call the Lord President to make his statement, may I tell the House that today, exceptionally, I took points of order before the statement? As a rule, I shag take points of order after statements, for the obvious convenience of the House.

HOUSE OF COMMONS (CATERING SERVICES)
The Lord President of the Council and Leader of the House of Commons (Mr. Michael Foot): With permission, Mr. Speaker, I should like to make a short statement. On Thursday 29th June I made a statement about the catering services of the House and I undertook to make another statement today.
Further discussions on the matter took place with union representatives on Friday last and I am glad to be able to report that some progress was made. I very much hope that further discussions will take place and that we shall be able to build on the progress made, so that we cart achieve a permanent and successful solution to the present difficulties, which will remove the sense of grievance that the catering staff feel over the lack of a pension scheme.
I am fully aware of, and regret, the great inconvenience caused by the disruption in catering services, but I hope that the House will be willing to accept what I have said and to await the outcome of further discussions. I shall report further as soon as I can.
Mr. Mellish: Is my right hon. Friend aware that some of us who have been here for quite a long while were astounded to learn that members of the catering staff do not qualify for a pension and that a certain member of the staff whom we all know personally is retiring next year after 25 years' service and will not
34
get a single penny? That cannot be right. Will my right hon. Friend please ensure that such a wrong is righted as quickly as possible?
Mr. Foot: It is in that spirit that I am approaching the matter. What I said to the House last week was that I thought that the first thing was to get a sensible discussion going in a proper way. That is what we did last Friday, and I think we are making some progress. Let us move along in that direction.
Several Hon. Members rose—
Mr. Speaker: Negotiations are under way. I will call the two hon. Members who have risen and then move on to a Standing Order No. 9 application.
Mr. Gow: The Lord President has made a statement about the catering services of this House. Important though they are, would it not have been better if he had come to the House and made a statement that the Government would reorganise business for this week so that we could have a debate about Rhodesia, where many of the Queen's subjects—
Mr. Speaker: Order. That is unreasonable, because the statement has to do with catering staff in the House of Commons.
Mr. Skinner: On a point of order, Mr. Speaker. Is my hon. Friend aware that, while he and those around him are trying to resolve this matter, it is rather significant that the Opposition have not made any request or asked any questions about it? If by any chance there were not to be a Labour Government next time, could we not then have a situation in which the delay which has gone on for so long could go on even longer? Will my right hon. Friend ensure that whatever decision is made is made very urgently in order that we can get the matter tied up before the so-called October election?
Mr. Foot: I do not know any more than my hon. Friend does about any October election. I do not regard an unfortunate outcome as being on the cards. I would not trust the Opposition, of course, but that is a different matter. I am hoping that we shall not have to trust them in this respect. I take into account what my hon. Friend said about

35
the desirability of proceeding with this matter at a good pace. That was one of the considerations that we mentioned when we discussed the matter on Friday.

STEEL INDUSTRY
Mr. Cant: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the crisis in the British steel industry".
The gross mismanagement of the restructuring programme of the British Steel Corporation almost led last week to the first major national strike in the steel industry since 1926. In the case of the Bilston plant, it was conceded that the agreed procedures had not been followed, and the closure letter was withdrawn. Mr. Bill Sirs said, in effect, that it had all been a bit of a shambles, and my right hon. Friend the Secretary of State said that it had been a bit of a mess.
More tragically, in the case of Shelton steelworks, which was closed by the BSC on 23rd June, it was conceded by Dr. Grieves, director of personnel and social policy, that the proper procedures had not been followed and that there had not been any consultation with the TUC steel committee. This raises legal issues which I propose to take up with the Lord Chancellor, but it has meant a loss of 1,600 jobs, whether this is due to callousness, administrative bungling or sheer incompetence.
36
There are now further rumours, relating to other important plants in this country to which this principle of closure by stealth is likely to apply. I need only mention Corby, Shotton, and even Port Talbot.
The crisis has also thrown up and left unresolved the role of the Secretary of State vis-à-vis the BSC and the TUC steel committee. I think that this is of great importance to the House.
Finally, at the Iron and Steel Trades Confederation annual conference, Sir Charles Villiers, chairman of the BSC, stated that it was now "gravely doubtful" whether this country would ever he a low-cost steel producer, throwing doubt on the basic strategy of the BSC.
These are the reasons for my request.
Mr. Speaker: The hon. Member for Stoke-on-Trent, Central (Mr. Cant) did me the courtesy of notifying me this morning, before 12 o'clock, that he would seek leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he believes should have urgent consideration, namely,
"the crisis in the British steel industry".
As the House knows, under Standing Order No. 9 I am directed to take into account the several factors set out in the Order but to give no reasons for my decision. The hon. Gentleman has raised an important matter. I listened carefully to what he said. But I have to rule that the hon. Gentleman's submission does not fall within the provisions of the Standing Order, and therefore I cannot submit his application to the House.

ORDERS OF THE DAY
  SUPPLY
  [27TH ALLOTTED DAY]—Considered

  NATIONAL HEALTH SERVICE (STAFF DISPUTES)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Snape]
  3.46 p.m.
  Mr. Patrick Jenkin: I am very sorry that the Secretary of State for Social Services has had to go back into hospital again. We hope that he will this time make a full recovery and be back among us soon. When I saw the headline in The Guardian this morning reading "Ennals patient", I wondered whether "patient" was an adjective describing the Secretary of State. But we express our sorrow that he is not with us.
  Two weeks ago, the Confederation of Health Service Employees had before its annual conference a resolution headed "Protection of patients". The resolution urged the Trades Union Congress to recognise that in the field of industrial disputes there was, as it put it,
  "a fundamental and intrinsic moral constraint"
  whereby hospital patients should not be caught up in, and suffer from the effects of, industrial action. The resolution called on the TUC to "recognise its responsibility" to formulate an explicit code of practice for the guidance of member unions in relation to
  "the moral facts of trade union activity which might adversely affect the wellbeing of hospital patients".
  There was also an addendum which called for an end "for ever" to what it described as
  "the anachronisms of strikes and lock-outs",
  and it asked that
  "arbitration and conciliation be used as mature forms of political development".
  The mover of the resolution was Mr. Cathal Breslin, of the Winwick branch. He was reported in the Nursing Mirror as saying that if the conference rejected his resolution it meant that
  38
  "whatever the consequences to patients, the principle of total strike action is not repugnant to the conference"
  He went on:
  "We have an obligation to prevent hospital patients from suffering hardships as a result of industrial action".
  He was supported in his motion by Mr. David Edwards of London St. Thomas's branch. He said:
  "This motion makes sound common sense. We have got to find ways and means of hitting hard at the people we are fighting—the system, the administrators—not the sick and dying patients caught in the middle."
  The resolution and the addendum were fiercely opposed, and, as was reported in the Press, they were overwhelmingly rejected by the COHSE conference. In a hurriedly called Press conference after the debate, an embarrassed Mr. Albert Spanswick, the general secretary of COHSE, explained that the rejection was on technical grounds, but it is worth examining what those technical grounds were. I quote from The Guardian of 23rd June:
  "He said it would have been in direct conflict with the union's Rule 14, which governs the withdrawal of labour and gives the national executive the absolute right to call industrial action as and when it deems necessary."
  One is forced to the conclusion that to the majority of COHSE delegates union rules loom larger than patient care. I have cited this recent episode because it illustrates dramatically what this debate is about—the threat to patients from disputes in the National Health Service.
  We have decided to devote one of out precious half Supply Days to the subject for three reasons. The first is that there is mounting concern, right across the political spectrum, at the spreading rash of strikes, go-slows and work-to-rules in the hospital service.
  When two such different political columnists as George Gale of the Daily Express and Hugo Young of The Sunday Times—who are poles apart politically—combine to condemn trade union attitudes and union morality the House should take notice. In his article in The Sunday Times on 25th June, Hugo Young wrote, referring to the hospital service:
  "Here we see electricians and other workers—even, sometimes, nurses—ready to with draw all or part of their labour, whatever the damage this does to an already declining

  39
  service and whatever the misery it inflicts on sick people. By any objective test, this is an act of impressive moral iniquity. It is the coarse exercise of power for selfish ends, injuring not some profiteering ogre of an employer but solely and exclusively defenceless patients."
  Our second reason for choosing this subject for debate is to give the Government an opportunity to explain what they are doing about the situation. Earlier this year stories began to appear in the medical Press saying that the Secretary of State was proposing, as part of the 30th anniversary celebrations, according to Pulse
  "an ambitious declaration from all who work in the health service to pull together".
  In an outspoken speech the Secretary of State said that he was "cheesed off" with those who disrupt services for selfish ends. He said that he wanted to crown his celebrations with a ringing declaration by all NHS staff that they would turn over a new leaf and put patients first.
  We now know that the Secretary of State will be disappointed in this. Under the headline
  "A cloud over NHS anniversary"
  in The Guardian on Saturday, we were told not only that his declaration; if it comes at all, will say little or nothing about disputes in the NHS, but that the whole document is so complacent that the doctors have refused to sign it. We need to know from the Government what is going on in the attempt to outlaw strikes.
  Our third reason for choosing this subject is more general. These disputes are self-inflicted wounds on an NHS which is already struggling because of constraints on public spending. Naturally, any discussion will involve criticism of trade union attitudes and actions and there is a temptation to remain silent.
  I draw comfort from Hugo Young. In the same article that I quoted earlier he said:
  "Yet throughout these latest assaults on the hospital service, how many politicians have straightforwardly attacked the hospital workers or even challenged the ethics of their behaviour? The Tories, crippled by fears of being misunderstood, have been muted. From Labour there has been abject silence…What this great problem needs is ventilation, by people who are not mesmerised by either fear or complacent indifference. Since 1974, unions have not only got more power. They have succeeded in suppressing honest outrage about how they sometimes use it."
  40
  I have no doubt that Mr. Young is a member of the National Union of Journalists and a sympathiser of the Labour Party. We should take note of what he says.
  We on this side do not run away from this issue. I have discussed the issues on many occasions, generally and specifically, with union leaders in the NHS, nationally and locally. I know that in most of the NHS hospitals industrial disruption is rare. In many hospitals it never happens. I say that without equivocation. I also know that many of the disputes are not necessarily of the unions' own making. I know that sometimes the unions have right on their side and that the NHS management is sometimes obtuse and insensitive and sometimes downright obstructive. But I also know that in the majority of cases of disruption there is no need whatever for action that harms patients.
  For those three reasons—public anxiety, to give the Government the opportunity to spell out their case and our duty to voice the criticisms—this debate is right and timely. I hope that we can discuss the issues rationally and coolly, despite the deep indignation that is felt by many people at what has been going on.
  In the debate on 20th April I referred to the growth of industrial disruption. I was challenged by Labour Members to produce chapter and verse. I did not wish to waste the time of the House and I do not really wish to take up time today. But perhaps it is necessary to remind the House about what has been going on.
  We should remember the appalling scenes outside the mental hospitals in the Mid-Surrey district last year when pickets from the Transport and General Workers' Union stopped food, fuel and drugs reaching some of the most deprived and disadvantaged people in our society—elderly, frail and psychogeriatric patients.
  Only recently there was the clocking-on dispute at the West London hospital, Hammersmith. Mercifully, that dispute was settled last week, but it led to a sharp cut-back in admissions and therefore lengthened the waiting list. There has been the threatened national strike by electricians and plumbers which—as I said at the time and the Secretary of

  41
  State agreed—would have led to the wholesale evacuation of major hospitals which would have been left without light, heat and power and would have threatened life because of the switching off of intensive care units, special baby care equipment and dialysis equipment. The country heaved a sigh of relief when that dispute de-escalated into nothing more than a work-to rule. But that was bad enough.
  The Guardian reported:—
  "Virtually every health region in the country has been affected by the industrial action ‖ Yesterday concern was growing at Great Ormond Street Hospital for Children—"
  of which ironically, the chairman of the governors is the Prime Minister's own wife—
  "where all open heart surgery has stopped."
  What of the misery of a small child prepared for a major operation who is told at the last moment that it cannot take place because of industrial action?
  Mrs. Jill Knight: And what of the parents?
  Mr. Jenkin: The parents would suffer, too.
  We should remember the telephonists strike which was condemned by both sides of the House because the telephonists were pulling out the plugs and purporting to be able to know which cases were urgent and which were not. There has also been the open warfare at Dulwich hospital because of personality conflicts, culminating in the suspension of all operations because the authorities rightly believed that in that atmosphere it was not safe to go ahead with operations.
  There was also the lightning walk-out of porters at the Westminster hospital because one of their number was taken ill and died after admission to the casualty ward. Those disputes achieved national headlines. But there are dozens of others which have escaped wide national coverage.
  There have been disputes leading to the threatened withdrawal of services. In April 1976 there was a dispute about overtime payments at St. Stephen's hospital, West Brompton and at St. Mary Abbotts. That dispute led to a suspension of admissions and a lengthening of waiting lists. In July 1976 at the Charing
  42
  Cross hospital there was a dispute over bonus payments.
  If anyone believes that those who lead these disputes are anxious to avoid threats to patients it is instructive to see what the porters' spokesman said on that occasion. He claimed that the hospital
  "had been forced to refuse admissions because of their action"
  while an administrator claimed that the situation was not so serious. That dispute was aimed directly at patients. The patients were not just the unfortunate victims of circumstance. There was a 24-hour strike at the Basingstoke hospital in July 1976. The hospital was reduced to what was described in the Press as
  "a shambles of bitterness and discontent by the activities of left wing shop stewards".
  In October 1976 there was a demarcation dispute at a North London hospital because, in the absence of porters, the nurses lifted the patients on to the operating table. The result was a lightning strike for the rest of the day and a suspension of operations.
  In April 1977 there was a strike over duties at the Queen Elizabeth Hospital for Children in Hackney and at the Great Ormond Street hospital. The administrator at the Queen Elizabeth hospital said:
  "The place is in absolute chaos, and if we have a real emergency there could be trouble."
  In May last year, there was a dispute over manning at the Seacroft hospital, Leeds, which led directly to the cancellation of operations for 50 children.
  I could cite many, many more examples, but perhaps I need only draw attention to what was said in a Written Answer given to my hon. Friend the Member for Woking (Mr. Onslow), who may catch the eye of the Chair later. My hon. Friend asked the Secretary of State
  "if he will list the hospitals in England and Wales at which the admission of patients is currently being limited by actual or threatened industrial action on the part of nursing and ancillary staff."—[Official Report, 27th June 1978; Vol. 952, c. 538.]
  I shall not read the whole Answer, but the Minister knows that he had to list no fewer than 36 hospitals at which admissions were being limited by the action of staff.
  Mr. Cranley Onslow: Should I be lucky enough to catch the eye of the Chair, I shall be able to tell the House

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  that that is a far from complete answer. I have information in my possession coming from the Minister himself which shows that there are a great many more hospitals where this is happening.
  Mr. Jenkin: That underlines my point, and I am grateful to my hon. Friend.
  What all this means in terms of human misery prolonged absolutely defies description. Health Service staff, I know, are individually deeply worried about what is going on, and many will have agreed in their hearts with a recent leading article in the Nursing Mirror, written in the wake of the mid-Surrey blockade to which I have already referred. I shall quote a passage from it:
  "‖ Industrial action which rebounds on patients and affects the sick, the injured, the elderly and the mentally ill ‖ is surely unacceptble to anyone whose chosen career is caring for the sick, in whatever capacity."
  The leading article then makes a point which I shall take up:
  "…there can be no nurse who would willingly use patients as hostages in order to achieve her own ends. Yet this is what it amounts to when industrial action makes patients suffer."
  I am sure that that is right. There is not an electrician in the country who would march into an intensive care unit and pull out the plug on the life support system and let the patient die. Of course there is not. There is not a plumber in the country who would force art incontinent patient to lie for hours in his own urine for lack of washing facilities in the ward. There is not a cook in the country who would set out to starve children in order to enforce some private personal grievance.
  But one then has to ask the question. The right hon. Gentleman is himself a member of NUPE and, presumably, has the ear of the unions. Why is it that, when men and women threaten to do these things collectively, somehow they can justify what they do? What it is about trade union collective bargaining which seems to blunt individual consciences?
  There was another revealing moment at the COHSE conference a week before last. I think that the whole House knows that it is the policy of NALGO, of NUPE and of COHSE to freeze out from negotiating bodies unions which are not
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  affiliated to the TUC. They are anxious to exclude the Royal College of Nursing, the Royal College of Midwives, the Institute of Health Service Administrators, the British Association of Occupational Therapists and many others from local committees, and eventually from Whitley itself.
  The Nursing Mirror carried a report last week of one of the debates at the COHSE conference on a resolution calling on members to exclude "the enemy" from management consultations. That resolution was carried with resounding support. Perhaps I should explain that the enemy" there referred to were, believe it or not, the nurses, the midwives and the therapists who belong to associations not affiliated to the TUC.
  One then looks at the reasons given, and this really says it all. I quote from the report in the Nursing Mirror:
  "One delegate complained that the Royal College of Nursing had tried to break up industrial action he had recently been involved in. He claimed that non-TUC-affiliated unions did not care about the fight to improve pay and conditions."
  The unspoken word there is that they cared about patients. That says it all. It is a very revealing statement. It is not patients who matter to these people; it is pay and conditions of staff.
  Mr. Geoffrey Finsberg: Does my right hon. Friend agree that it is equally bad that the Socialist chairman of the Camden and Islington health authority should give her support to failure of consultation and walk out of a meeting which the local accredited representatives of the Royal College of Nursing wanted to attend?
  Mr. Jenkin: I agree with my hon. Friend. If people want to negotiate these things, let them negotiate, but let them not try to coerce unions and administrators by the use of force. This business of walking out and so on is quite absurd especially when, in the Camden and Islington area health authority, the majority of nurses are in the Roy al College of Nursing and only a minority are in the TUC-affiliated unions.
  If that is the sickness—it is a sickness, and there is no burking the issue—what is the cure? The first answer must be better management. Of that there can be no doubt. The report of the Dulwich

  45
  inquiry, which I have read in full, revealed many weaknesses, and they must be put right. But, equally, there must be a recognition of the ultimate responsibility of doctors and nurses—clinical staff—for their patients.
  In its comments on the Dulwich dispute, The Times said:
  "But hospitals cannot be run safely and efficiently unless clear-cut responsibility in clinical matters lies with those who are qualified to take clinical decisions."
  One of the things that we look for from the Minister today is an absolutely unqualified affirmation of that proposition. Nothing has done more damage than that unqualified people should presume to decide which are emergencies and who are the patients who need immediate treatment.
  Secondly, with better management must go better leadership. One of the problems of the Health Service is that, as management gets more difficult, so the requirements of leadership become more important, and often one hears from people at all levels in hospitals of the lack of effective leadership on the ground.
  Thirdly, we need greater personal respect for all those involved. It is an old saying that if you treat people like dirt they will behave like dirt. I have no doubt that in some cases one can see the cause of disputes in that. Sometimes, only the simplest things are necessary. I read in the evidence of the King's Fund to the Royal Commission that there was a dispute in one hospital about manning of rotas for an accident and emergency unit, and the simple strategem of writing up the names of each team, whether consultants, nurses, secretaries, administrators or porters—from Mr. A down to Mr. W —immediately removed the problem. Each saw himself or herself as a member of the team and there was no question of people fighting for positions. There must, as I say, be personal respect, and sometimes no more than a simple thing of that kind is necessary.
  Certainly, we need better consultation procedures. Many disputes are caused because the consultation procedures are unbelievably slow and bureaucratic and people's patience runs out.
  I see talk in the medical Press of a patients' safety committee as a sort of ultimate longstop so that there could
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  be groups in each hospital able to say, when a dispute came along, which patients must not be allowed to suffer and be able to identify them. Perhaps that could be looked at.
  Certainly, reform of the staff side of the Whitley machinery should be examined. The McCarthy report is now some months old. We have had an interim report, but we should like the Minister of State to tell us now what is happening about implementation of the McCarthy recommendations.
  But even with all that—and it is a big enough recipe—I still say that if we are to avoid these damaging disputes—
  Mr. William Molloy rose—
  Mr. Jenkin: The hon. Gentleman has been bubbling away, and I shall give way to him now.
  Mr. Molloy: I am much obliged. I can support much of what the right hon Gentleman has said, but may we have an understanding with him that, if we implement all that he is calling for, he will not then turn tail and say that it all involves extra public expenditure and when his boss comes along, he will have to follow her and not agree?
  Mr. Jenkin: There is nothing here which calls for a penny extra of public expenditure. We are talking about better procedures, swifter management and so on. On the contrary—if we can remove some of the burden of bureaucracy, many of these improvements could be achieved with reduced public expenditure.
  But, with all that I am urging. we still need a pretty fundamental change of attitudes on the part of some people who are working in the National Health Service. I have quoted before, and I shall quote again because I think it important, the statement of Alan Fisher, the general secretary of NUPE, when he gave an interview to the Health and Social Services Journal a year or two ago. He was asked:
  "How far do you take account of patients?"
  He replied:
  "We all have interest in the welfare of the patients, but they are not our predominant interest. Our job is to safeguard the terms and conditions of our members".
  We in this House are entitled to say that those who take employment in the

  47
  National Health Service should be prepared to say that they regard the interests of patients as paramount.
  Mr. Stephen Ross: The right hon. Member has made that statement, but will he extend that to the consultants? I take everything that he has said up to now, but he has not actually mentioned the fact that the consultants were in this position about a year or so ago.
  Mr. Jenkin: It was, in fact, nearly three years ago. I have condemned that on many occasions. But I am bound to tell the hon. Gentleman that if he goes around the country—as I know he does—and talks to people, he will find that it is not strikes by consultants that people are worried about now; it is what I have been talking about. I spoke to an audience of junior doctors in the Grand Committee Room and told them to their faces that they had no right whatever to withdraw their labour to the detriment of patients. If it is necessary, I reaffirm that today.
  I am looking for a recognition by all those in the Health Service that the patients must come first. I welcome the efforts which the Secretary of State has made to get a joint declaration. As a matter of historical accuracy, I think that it was the secretary of the British Medical Association, Dr. Elston Grey-Turner, who made the first move on this and approached the TUC. But one has to say —and I say it regretfully in the absence of the Secretary of State—that the Secretary of State jolly nearly fouled it up right at the beginning by linking this idea of commitment to patients with his thirtieth anniversary celebrations. I am bound to say that at the time I regarded that—and I regard it today—as a very foolish gimmick, and it all but torpedoed an important initiative.
  I understand, however, that the initiative has survived and that the Under-Secretary is chairing a committee. Perhaps the Minister of State can tell us something about that.
  I would say very firmly to the TUC that it must be ready to meet other unions and associations half-way. But I am not hopeful that these words will be heeded. Last Thursday the TUC held its own thirtieth anniversary celebration. In the words of The Times they
  48
  "did nothing to help the controversial statement of intent on industrial harmony in the service".
  What was said—again I quote from The Times of 30th June 1978—was this:
  "There was applause for Mr. Reginald Bird, of the Association of Scientific, Technical and Managerial Staffs, when he said he found it deplorable that Mr. Ennals had invited the British Medical Association, the Royal College of Nursing and representatives of other medical and nursing royal colleges to informal discussions about labour relations on exactly the same basis as discussions with the TUC."
  One is bound to ask Mr. Bird "Why on earth is that deplorable?" One asks him and those who think like him whether they have no sense of common purpose at all in joining with the doctors, nurses, midwives and others in what is, after all, one of the noblest of human aims—the care and healing of the sick.
  The unions, I am sure, are among those who would subscribe to the view spelled out in the recent release from the Labour Party from Transport House, which says that the NHS is
  "the cornerstone of the caring society which looks after all its citizens."
  It goes on to say:
  "The NHS is still the envy of most of the world."
  The NHS will swiftly forfeit any claim that it may ever have had of being the envy of the world, unless we all, politicians and plumbers, cooks and consultants, recognise that in moving that COHSE resolution two weeks ago, Mr. Cathal Breslin was right and that there is, indeed
  "a fundamental and instrinsic moral constraint whereby patients should not suffer from the effects of industrial action."
  What we need today is a Geneva Convention by all who work in the NHS—that, come what may, patients will always be their first concern. In a service caring for the sick, the injured, the old, the crippled and the dying, is that really too much to ask?
  4.15 p.m.
  Mr. Laurie Pavitt: The right hon. Member for Wanstead and Woodford (Mr. Jenkin) has made a sensational case, and at times he piled sensation upon sensation. The House knew that it was in for a union-bashing afternoon when the subject for debate was put forward by the Opposition. We knew we would get a lot of selective

  49
  stories—quite true stories of course, but, as the right hon. Gentleman knows as well as every other hon. Member, a sensational story makes news, but a good story does not.
  What the right hon. Gentleman has done is to select a wide number of things which perhaps might be deplored by many people, to give a highly unbalanced and distorted account of what happens concerning workers within the NHS. The right hon. Gentleman has been less than fair to COHSE's annual conference. In spite of the fact that he quoted the Press conference afterwards as a kind of apologia, he knows, as well as everybody else who has studied the effects of that conference, that there was nothing in the principles of the proposal that was objected to by the leadership on the platform. A remission was asked for, and had it been remitted it would have emerged in the kind of form which could well have satisfied the right hon. Gentleman. But as a conference procedure, that never happened.
  Mr. Patrick Jenldn: But the resolution was not remitted. It was thrown out, as The Guardian said, by an overwhelming majority.
  Mr. Pavitt: The reason why it was thrown out was that the mover refused to remit it, and that is the normal procedure at every conference, as the right hon. Gentleman knows. He has been less than fair to Alan Fisher of my own union. I have no interest to declare, because, although I am a member of NUPE, I am not a sponsored Member. However, I am very proud to be a member of that union, in spite of the fact that from time to time, like all other organisations, things happen within it and in individual areas of which I, as a member, would not necessarily approve.
  But I would say to the House that no other union has done more to raise the morale of the workers inside the National Health Service than the National Union of Public Employees. Therefore, when one hears attacks mounted upon specific instances such as those made by the right hon. Gentleman this afternoon, it is less than fair.
  The right hon. Gentleman has taken on the whole role of the public prosecutor, and he has mounted a prosecution
  50
  case. If he were to take some kind of balance, some kind of perspective, and if he were sitting in a different position, other than that of being in the Opposition, and if he should ever find himself in the position of being a Minister in the DHSS, he would find a whole number of good reasons why that kind of case does no good to the public at large, does no good to the Health Service, and no good to the feeling in his final words, with which I agree so much, that he is trying to engender a feeling of being part of and being prepared to work for the MIS and being prepared to accept the kind of provisions the NHS delivers.
  The language the right hon. Gentleman used was emotive. All the things which he quoted—for example "assaults on the hospital service"— build up an atmosphere of emotion which, in my view, does no credit to this House and does no credit to those people seeking to deal with the real difficulties which we accept exist within the Health Service and which we are seeking to put right.
  The hon. Member for Isle of Wight (Mr. Ross) immediately raised the point that, of course, we are talking about the lowest paid and the lower-paid workers. We are not talking now about the clinical staff and we are not talking about the hospital doctors. The NHS is the only organisation in this country which is under constant and fervent attack because it is imperfect. We look at its imperfections and we can tell what is wrong with it. The fact that there are about 2½ million successful operations is never recorded, but if there is one which goes wrong, immediately one gets headlines in the Press.
  What has happened in this debate today is that disputes have been taken out of all perspective, because the NHS is the largest employer of labour in this country. The total figure of manpower and womanpower is nearly 1 million people. That means, in ordinary terms, that we are talking of disputes affecting 300 million working days. How many days have we lost through industrial disputes affecting the patients? In 1974 the figure was 17,811. In 1975, it was 13,225, and in 1976 it was 14,931—out of 300 million working days. There is no industry, either nationalised or private, which can show that kind of record of work service.

  51
  It is because, as the right hon. Gentleman knows, of the fact that the vast majority of people working in the service are devoted and give of their time and their energy that we ought to be praising them, rather than sorting out the few bad eggs in the basket and not praising the good ones.
  When considering the effect on patients of any disputes, NALGO's record is typical. NALGO has 90,000 members in the NHS and in the last two years has had only nine official stoppages. Three were overtime bans, five resulted in non-co-operation and one related to non-participation. That is for a staff of 90,000 in all grades. There is less industrial unrest, non-co-operation and overtime banning and fewer strikes in the NHS than in any industry, nationalised or otherwise.
  We must recognise the reality, that nearly 1 million people give devoted service year in and year out on less pay than they would get outside the hospital gates. The ancillary worker whom the right hon. Member for Wanstead and Woodford attacked earned in April 1977 an average of £59 a week. Doing the same job in a nationalised industry he would get £76 and in private industry he would get £74.
  What adds to the feeling of wage injustice is the fact that the last two decades of freezes, pauses and pay policies have meant not only that the hospital worker gets lower pay at the time but, because of his pension arrangements, at the end of his time his pension is also that much short. Naturally, that arouses the kind of frustration which in outside industry can be remedied by industrial disputes and in other ways. In the NHS, as the right hon. Gentleman knows, in the majority of cases the feeling is that other action should be taken.
  Mr. Patrick Jenkin: That may have been true some while ago, but nearly two years ago, on 29th September 1976, in Blackpool, the Secretary of State said:
  "We have seen the largest increase in Health Service expenditure ever experienced during the days of this Labour Government. Of course I have to say that those who benefited most—and rightly so—were staff."
  It is not as if they have been neglected.
  Mr. Molloy: It is still not enough.
  Mr. Pavitt: The right hon. Gentleman is correct. Before that, especially in the period 1970–74, they had appallingly low wages. In 1975, when my right hon. Friend the Member for Blackburn (Mrs. Castle) was Secretary of State, another £800 million was put into the NHS, which allowed us to right many of the anomalies from which the workers previously suffered.
  The greatest threat to patients in recent disputes has been the action not of ancillary workers but of doctors. The greatest threat was the junior hospital doctors' efforts; they added 100,000 to the waiting list, which we are still trying to clear. But the right hon. Gentleman never likes to talk about what the doctors do.
  There is no way in which a layman can judge the threat to a patient when a consultant decides to work to rule, because only the consultant knows what rule he is working to. Whether one is waiting for a hip operation or something else, if a doctor is politically minded and, as has happened recently, wishes to make political capital out of a bash at the NHS, he can use the problem of a long waiting list, since it is mainly the consultant who controls the waiting list.
  Mr. Onslow: The hon. Member will know of my interest in the subject of hip operations, on which he has just touched. Will he categorically state whether he is blaming the doctors for the fact that the waiting time for hip operation is steadily lengthening?
  Mr. Pavitt: I blame it on two counts—the first is that they are refusing to have a common waiting list between private and general practice, which the Department has been trying to negotiate with them for 12 months; the second is a specific case. We know that probably nothing attracts attention so much as a specific case. In one area—I will not name it, but the whole House will know of it—public meetings have been held concentrating on hip operations. Had there been more determination and better co-operation between senior registrars and the consultants, the waiting list would have been much better in that area.
  There have been advances in some aspects of pay—particularly for the nurses when my right hon. Friend the Member for Blackburn was Secretary of

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  State in 1974. One area where no threat to patients occurs is through industrial action by nurses. Yet when my right hon. Friend is considering the pay structures within the NHS he should remember that, in spite of the 10 per cent. increase for nurses which has just been received, a staff nurse of 28 or 30, who has trained for three years and spent five years on the wards, now gets £3,255—less than many girls working in offices with hardly any training.
  COHSE is such a good organisation because its members are devoted to the mentally sick and mentally handicapped and do the kind of job of which many of us would be scared. A staff nurse in that organisation on the top grade in a mental hospital gets £3,424. A male staff nurse has to cope with dangerous situations, with locked wards and with instances in which, unless he is well experienced, a mild outbreak by one patient can in a moment inflame a whole ward.
  It would be much better if the Opposition devoted some of their Supply Days to talking about that kind of thing, about the kind of services that our people in the hospitals give—instead of concentrating on industrial action taken, perhaps, to keep open a casualty department which the calculating machines have decided is no longer an economical proposition because it is too small. When workers take that sort of action, many of us feel that there is something to be said for sit-ins, even if that means some kind of industrial action. It is on behalf of would-be patients.
  The present situation is the fault of successive Governments. Each Government—I blame this Government as much as their predecessors—disobey the cardinal rule of medicine and treat the immediate symptom without trying to diagnose the basic problem.
  I accept what the right hon. Member for Wanstead and Woodford said about McCarthy. What is needed and has been needed for some time is a basic restructuring of the whole organisation, so that frustration does not build up and explode in a way which may harm patients.
  It put the blame fairly and firmly for the present bad procedures on the right hon. Member for Leeds, North-East (Sir K. Joseph). He cannot escape respon-
  54
  sibility for the appalling reorganisation which he forced through against the wishes of this side of the House and which has only exacerbated work relations throughout the hospital service. In this week's British Medical Journal there are two excellent articles, by Sir Francis Avery Jones and Professor Rudolf Klein, which show beyond peradventure that the reorganisation was a mistake because it put too big a distance between administrators and NHS doctors and ancillary workers and broke up the partnership between those working in the hospitals and those running the service.
  The Opposition complain about bureaucratic growth, about the fact that there are now too many tiers and about the amount we spend on administration, yet they never admit that their Government forced through the reorganisation over an unwilling Opposition who opposed it at all stages.
  I repeat what the right hon. Gentleman said about McCarthy. In its 1976 report, the committee said:
  "Many small disputes in the National Health Service have been exaggerated because there is no regional disputes procedure: therefore everything is taken to Departmental level and takes a very long time."
  I endorse that.
  But it is even worse than that. It is not just that there is no procedure at regional level. There is none at area level either. Many of the instances given by the right hon. Gentleman are isolated cases which stick at district level and for which we have no machinery to get unstuck. As a result, negotiations cannot succeed and the result is the kind of thing that we all deplore, when a small group of people feel that they have no option but to proceed in a way which might harm the patients they normally serve so well.
  The unions have now agreed with my right hon. Friend on new procedures and a document has been prepared. I plead with my Front Bench not to let the consultative processes take too long. I think that at the present time the chairmen of regional health authorities are looking at what has been proposed, and that those on the other side of the Whitley Council are also looking at it. The document must be made operative before the House rises. If things go on for longer than that it will be far too late.

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  There is a need for urgency, and the sooner the matter is concluded the better.
  It is time that society—and that includes the Government. Parliament and ourselves—faced the fact that in this debate we are discussing ordinary rights of workers. Rights available to workers in every other industry are far higher than those available to those who work in the hospital service.
  In that recognition we have to accept responsibility. We have to agree not to find scapegoats for what goes on but try to put the darned thing right. We have had 30 years in which to do it but successive Governments have failed. Teachers cannot strike without affecting children. Hospital doctors and others cannot exercise muscle in a dispute without hurting innocent people—in this case, as the right hon. Gentleman said, patients who are often crying out for the alleviation of pain and distress.
  I submit to the House that we must take responsibility for creating a framework within which justice can be done without the normal action of industrial disputes. We must realise that unless there are alternative methods there is the likelihood of industrial disputes occurring. If there are inordinate delays in seeking to resolve real grievances frustrations build up and the situation becomes explosive. When that happens it becomes extremely difficult for us to be able to have the kind of service of which we are all proud.
  4.32 p.m.
  Mr. Cranley Onslow: What on odd speech that was. Here and there it contained some quite sensible bits, but here and there some crazy ones. The hon. Member for Brent, South (Mr. Pavitt) accused my right hon. Friend the Member for Wanstead and Woodford (Mr. Jenkin) of union bashing—the sort of instant reaction of any Socialist who knows that he is on to a thrashing at the polls. And what a silly attitude to take, to put all the blame on the doctors, as if they genuinely wish to see patients suffer, and as if they alone were guilty in any way of causing suffering to patients. What a partial little speech. What a pity because the hon. Gentleman knows something about the subject and he ought to do better.
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  I go with the hon. Gentleman in one respect: I accept that blame can be put on successive Governments of all parties, but I think that the hon. Gentleman could have placed a good deal more blame on his own Government without stretching credibility too far.
  Mr. Pavitt: Can the hon. Gentleman explain why in the Good. Hope hospital at Sutton Coldfield only three hip operations were done in 12 months?
  Mr. Onslow: There are always particular cases that can be distorted to provide evidence for exaggerated points. When I have finshed speaking the hon. Gentleman will probably accuse me of using similar evidence for the same purpose, but I do not see any point in trading insults with him, because I want to talk about one or two things which concern me and which I believe are relevant to this debate. If the hon. Member for Ealing, North (Mr. Molloy) would like to suck his teeth somewhere else, it will cause me no offence because this is a serious matter and I hope that it can he taken seriously.
  Mr. Molloy: Get on with it.
  Mr. Onslow: I shall get on with it, because Brookwood hospital in my constituency has attracted some national attention because of disputes which have arisen there and attained a good deal of prominence lately.
  I admit—and everybody who studies this problem must concede—that there is a long history of friction at that hospital. It goes back at least four years, and I have no intention of wearying the House by rehearsing the whole of it, but there are things about the present situation which I believe could properly be drawn to the attention of the House.
  The House probably knows the events concerning the so-called takeover by a workers' council and I hope has welcomed, as I do, the fact that the matter has now been resolved to the point that there is to be a full inquiry into what has gone on and what has been wrong. I do not wish to pre-empt that inquiry or to do anything to make its task more difficult. I think, however, that it is right to express some reservations about the way in which things may go unless those concerned are very careful.

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  I do not know how things will go, because so far we have got no further than that the committee of inquiry is meeting today to settle its own terms of reference, but if we accept—and I hope that all concerned will accept—that relations are so bad that workers feel obliged to resort to a particular action, and that management on its side feels entitled to react, the prime public interest in the matter—and it is this with which we should be concerned—is to find out what has gone wrong and try to put it right.
  In any dispute there may be many reasons why people have fallen out with one another. It may simply be a personality clash in conditions of stress. That is something that we need not regard as being in any way political or unusual. The reason may turn out to be nothing worse than that. On the other hand, there may be administrative failures. There may be failures of communication on both sides, and I am sure that the hon. Gentleman will accept that those can be a cause of dispute. If those are the reasons, I hope that this inquiry will bring them out.
  If reorganisation is part of the reason why these things have happened I shall be delighted if that, too, is brought out, because there is a good deal of force in the argument that reorganisation has lengthened the chain of decision to a point where people who used to be able to take decisions are now criticised not for their faults but simply because the system prevents them from taking decisions. That is something that we should not be afraid to admit and discuss, and I am not afraid to admit or discuss it.
  Equally, if there is—and there may be—a campaign on the part of one union or another—and COHSE is one union in dispute here—against the members of another professional body, the Royal College of Nursing, and if that is part and parcel of the dispute, that, too, had better be brought out. I am sure the Minister knows that at least one former employee at this hospital, a Royal College of Nursing member, has just successfully brought proceedings before an industrial tribunal for unfair dismissal. If there is such friction between COHSE and the RCN, and it seems, from reports in the Press yesterday, that that may be a general and not a particular develop-
  58
  ment, that is something else which has to be brought out in the public interest, and brought out impartially.
  It may be—and I suppose that this again may be a reflection of inadequate management on somebody's part—that there is a simple conflict of objectives in a mental hospital such as Brookwood. There is some evidence to show that that may be so in the comments of the area health authority on the local community health council's report for 1976–77. This drew attention to the difficulty in getting full use of the rehabilitation unit in this hospital.
  The area health authority commented:
  "Nursing unions are reluctant to divert resources from the sick towards rehabilitation. Regretfully the current staffing situation is such that it is possible only to deal with the rehabilitation of patients from Brookwood Hospital, and it would be unrealistic to attempt to deal also with patients from other units."
  If there is a conflict there—and there seems to be one—it is probable that the responsibility for that lies higher than health authority level, and if that is so, that fact needs to be identified.
  If the root cause of all the unrest in the Health Service is basically a total inadequacy of Government funding, that again is something that should be brought out into the open here and now.
  My point in going through that list of possible causes of the dispute is to question whether an internal domestic inquiry within the orbit of the area health authority will be adequate to protect and define the public interest. I do not believe that this is the only hospital where this sort of thing has happened, and it is important that when there is a dispute of this kind—just as we had a different cause for inquiry at South Ockendon and elsewhere—we should get at the root of the matter. There should be no hesitation in and no inhibitions about establishing the reasons why things go wrong.
  I hope that the hon. Gentleman will agree with me on that, and that he will not be reluctant to see that the truth is brought out and that no accusations of union bashing, doctor bashing or any such thing are made. I hope that he will have the responsibility to agree with me there, because these matters are too serious to be brushed off with electioneering gibes of the kind he gave us.

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  In his admirable speech, my right hon. Friend the Member for Wanstead and Woodford referred to my recent Written Question about the number of hospitals
  "at which the admission of patients is currently being limited by actual or threatened industrial action on the part of (a) nursing and (b) ancillary staff."—[Official Report, 27th June 1978; Vol. 952, c. 537.]
  I intervened in my right hon. Friend's speech to suggest that the Minister's answer had been less than complete and accurate. I can give one instance, again very close at hand, which I hope will show that I am not making a light or unfounded criticism.
  I refer to Botleys Park hospital, which was not in the list in the Minister's reply and which was the subject of a letter to me from the right hon. Gentleman on 25th April. He said:
  "As you know, the admission of patients to Botleys Park Hospital for long-term care has been suspended because of industrial action taken by nursing staff, in support of their demands for improved nurse:patient ratios at the hospital."
  There has been no change at the hospital since then. I confirmed that by telephone this morning.
  I completely fail to understand why that hospital was not included in the list. If the criteria were so drawn as to exclude it, I am fairly sure that a number of other hospitals were similarly omitted. I wish to know more about that, because when we are discussing the effect of industrial action on patients in the National Health Service I should like to put in a word for the people who do not even get into hospital. That hospital is a case in point.
  Dr. Gerard Vaughan: Would it be of assistance to my hon. Friend if I later gave him what is quite a long list of hospitals where admissions are at present being refused? The Westminster hospital has been doing it for about one week a month. That hospital does not appear in my hon. Friend's list. Borocourt hospital near Henley is doing it. One of the Bristol hospitals is doing it. I can give my hon. Friend a long list of hospitals which do not appear on his own list.
  Mr. Onslow: I am grateful to my hon. Friend, but he gives me no comfort. However, he underlines the point, and I
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  want to underline it further by telling the Minister and the House what is the situation at Botleys Park hospital. It is a hospital for mentally handicapped people, who are perhaps the least able to raise their voice in the House.
  On that hospital's waiting list at present there are 23 urgent cases and 60 less urgent. Of the 23 urgent cases, there are six male adults, 12 female adults and five children. The House might like to hear a little about one of those children. She is classified by her consultant as being in a situation of serious risk to herself and to her mother. She is a severely disturbed girl of 13½, needing special attention. A special request was made to the trade union action committee to admit her, but as she will create extra work for the already hard-pressed nursing staff the committee was unable to accede to this request.
  Let that be noted by the House as a situation faced not only by patients but by those who should be patients. I have given the example of a girl of 13½. There are four others like her at that one hospital. There are 18 adults in a similar position and 60 less urgent cases. Who draws the line between urgency and non-urgency?
  That is the position we confront on the thirtieth anniversary of the NHS. When I press the Minister on the subject, as I have done for some time, in the end he returns to this defence, as he did in a letter:
  "I would, of course, have preferred to see a higher level of forecast expenditure‖ but‖ recognition must be given to the overriding importance of other national priorities within the Government's economic strategy."
  All right, But as a defence that does not seem to me to be particularly watertight, even if the hon. Member for Ealing, North and his hon. Friends say "That means that you are arguing in favour of increased Government expenditure." We are not necessarily doing anything of the kind. What we are doing is to attack the Government for failing to understand that part of the answer may be better deployment of the resources that the NHS already has.
  The hon. Members for Ealing, North and Brent, South, who take such a keen interest in these matters, no doubt rejoice and boast to their constituents that

  61
  another £50 million has been made available for the NHS. Not a penny of that is filtering down to Botleys Park hospital.
  Let us be factual about the matter. While it would be possible to identify matters such as the gift of ships to Poland or the giving of aid to Mozambique—which could be cut out of public expenditure at no great loss, the money being spent on the NHS instead—it is also possible, without arguing for any additional expenditure, to say that there are resources which could and should be better spent.
  That is what the debate is about. I am astonished that it is not a censure debate. It is a poor way to celebrate 30 years of the NHS to have to say that waiting lists for the mentally handicapped, urgent cases, are growing longer; that there is, as all hon. Members know, increasing industrial friction within the NHS and that the position is evidently unlikely to improve in the short term.
  In such a situation it behoves hon. Members on both sides of the House to ask themselves where the priorities lie. Of course, nobody would contemplate holding patients hostage. But there is another way of looking at the matter. The hon. Member for Brent, South spoke about the rights of workers in the NHS. If one wishes to complete that argument, it is necessary to think about their duties as well, because rights and duties balance one another.
  In the end, the community must decide what sort of health service it wants. The community has to pay for it. The hospitals work for all of us, for the healthy as well as the sick. The question which worries me, and which the debate brings out, is this: are we not in some danger of losing the right, as a democracy, to decide what sort of hospitals we want? Is this not being taken away from us? After 30 years of the NHS, I do not find that a very encouraging reflection to be driven to.
  4.47 p.m.
  Mr. William Molloy: I think that the hon. Member for Woking (Mr. Onslow) will forgive me if I do not go all the way with him in his submissions. I cannot understand why he got so angry with my hon. Friend the Member for Brent, South (Mr. Pavitt), who accused the right hon. Member for Wan-
  62
  stead and Woodford (Mr. Jenkin) of being the supreme trade union basher. I could only think that it was because the hon. Gentleman had a much better trade union bashing argument to submit.
  If the alleged matters have been going on in the National Health Service, they must cause us all concern. As the right hon. Gentleman said, if anyone went into an operating theatre, pulled out a plug and deliberately ended someone's life, if action as deplorable as the instances alleged were being taken every day by all those who work in the NHS, by now the NHS would have broken down. Any such action is to be deplored. To say that it is the rule rather than very rare is irresponsible.
  But what is even more vulgar and deplorable is to use such arguments for political advantage. That is what we have mainly heard this afternoon, and I find it distressing. Anyone listening to the debate so far would have thought that practically everyone—every doctor, nurse, auxiliary worker and administrator—within the NHS was a nefarious person with ill designs on the entire British nation.
  I know that there is nothing that the Conservatives would not stoop to now that they know there is a General Election coming. Would any stranger, witnessing their crocodile tears, believe that the Conservatives, who speak of the noble concept, the wonderful, compassionate idea that is the NHS, fought tooth and nail to prevent its being born? I hope that the silence from the Conservative Benches indicates some remnant of embarrassment—
  Mr. Patrick Jenkin: The hon. Gentleman is talking nonsense.
  Mr. Molloy: The right hon. Gentleman is a great authority on the subject.
  We have to try to be sensible. It would be silly for us to say that everything done by the trade unions in the Health Service is perfect and wonderful. Equally, it would be grossly inaccurate for Tory Members to put forward certain selected cases and seek to represent them as normal practice. I hope that the Minister will tell the House, in view of what was said by the right hon. Member for Wan-stead and Woodford, how many people died, or suffered and died as a result of

  63
  that suffering, following industrial action. That is the test.
  I agree with what I believe the hon. Member for Woking was trying to say on this point. He was perhaps too shy to say it. There cannot be a dispute unless there are two sides to the argument. It may be that a dispute is caused by a trade union which is not just or temperate. On the other hand, such a dispute could arise as a result of coarse or insensitive management. I believe that that is the more likely proposition.
  Mr. Onslow: I am always obliged to any hon. Member who attempts to improve on my speeches. That cannot be too difficult. What I was trying to say was that it does not make much sense to argue about where to put the deckchairs when the "Titanic" is sinking.
  Mr. Molloy: Have we just heard some Freudian slip? Are the Opposition hoping that the "Titanic" of the Health Service will sink? We shall not let it sink. We created it and we shall save it.
  My hon. Friend the Member for Brent, South has made the point that there are levels within the National Health Service at which it is difficult for trade unions to negotiate. Many of the issues with which they are concerned, sometimes to the point of exasperation, have nothing to do with wage increases or conditions of service. They are related to the attempt to improve conditions for the patients they try to serve. It would be wrong for the House to give the impression that the millions who work for and are associated with the NHS are not trying to give of their best in this most noble of services. It is wrong for the Tory Opposition to give that impression.
  As serious as irresponsible trade union action or stupid management action—which, it appears from our experience, takes place too often—is the ganging-up of consultants within the pay bed system which stops someone from having a vital operation because they do not have the money. This is vulgar. We all assume that those who use the pay beds and receive preferential treatment pay once they have received that treatment. But that is not true. Many hospitals have been stung as a result of someone jumping the queue and promising to pay for a bed
  64
  but subsequently vanishing without paying a halfpenny.
  These are the types of people who ought to be condemned by the right hon. Member for Wanstead and Woodford, not the others whom he mentioned. If the Opposition want to implement all the wonderful things they have talked about, it is necessary for them to unite with all other parties to bring about Aneurin Bevan's dream of a free and comprehensive Health Service at the point of need. That is something which the Tory Party has never been prepared to accept.
  Much of the work carried out by COHSE, especially in the mental health area, has nothing to do with the wages or conditions of its members. It is working to deal with the faults within the NHS. Let us put that on the credit side. Much of the time of unions such as COHSE is taken up in examining what can be done to improve the efficiency of the service and making recommendations to successive Governments, sometimes without much success.
  Many of the problems within the service could be avoided if we were prepared to allocate the money which the service demands. The hon. Member for Woking remarked that I sometimes seem to get upset about some aspects of the NHS. Let me tell him about the latest example. It has nothing immediately to do with the Health Service or with nurses, auxiliary workers or the unions. In Ealing we have been waiting for over seven years for the completion of a hospital which ought to have been constructed in two or three years at the most. I had to raise the matter on the Adjournment.
  The hospital was partly built and it has been necessary to repair the damage that has been caused to this hospital. This is a far greater disgrace than anything mentioned this afternoon. During the long campaign to have this hospital built, the people in Ealing received the massive support of COHSE—not because it wanted the doctors, the nurses and the auxiliary workers to have employment but because it could see a need in that part of London and realised that somewhere in the upper echelons of the Health Service insufficient pressure was being exerted. This is to the credit of the trade union movement.

  65
  While many matters need to be put right in the NHS, it would be frightful if our people believed that they were at grave risk when they entered hospital because of the attitude of the millions who work in the NHS. It would be an enormous crime to produce such an inference, for whatever reasons. I trust that we shall have a much more balanced appreciation of the Service. Let us recognise what is wrong and condemn dangerous behaviour wherever it arises—whether in the higher echelons of management, among the consultants or the trade unions. In some instances it has been possible that an industrial dispute would involve a withdrawal of labour. In such cases no action has been taken by COHSE until there has been a guarantee to the effect that services can continue so that no one's life will be in danger. That is why I ask my right hon. Friend to give some statistics along these lines.
  I acknowledge that some of the matters submitted by both sides of the House are damaging to the National Health Service and should be eliminated wherever possible. But I believe that we in this House also have a responsibility to acknowledge that much depends on the allocation of resources. Many of the irritations and other things that are a cause of concern and worry to those working in the NHS and to the public who require the services of the NHS are caused by the fact that we are not giving it the money it demands. We must go further.
  The NHS is a noble endeavour. It is almost the apotheosis of the principle of the good Samaritan. We have to say all these things, and if we mean them we must have the courage to vote to the National Health Service the funds that it requires to achieve what we believe that it can achieve for the benefit of the people.
  5.1 p.m.
  Mr. Stephen Ross: I very much agree with the closing words of the hon. Member for Ealing, North (Mr. Molloy). My right hon. and hon. Friends would like to join the right hon. Member for Wanstead and Woodford (Mr. Jenkin) in conveying our best wishes to the Secretary of State for Social Services for a speedy recovery.
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  I do not normally speak for the Liberal Party on health matters, so I make it clear at once that I do not have the expertise that many hon. Members have. But, like the hon. Member for Brent, South (Mr. Pavitt), I have nothing but praise for the hospitals with which I have been associated, as a fairly frequent visitor, or as a guest at management meetings, having sat in on several in the Isle of Wight, or as a patient. On behalf of my constituents, I can say that we have nothing but praise for the hospitals in the Isle of Wight. We have a magnificent new maternity wing at St. Mary's. The Minister himself is coming on Thursday to open our new geriatric day centre.
  Despite all the pitfalls of the NHS, an enormous amount has been done over the years, and, like the hon. Member for Brent, South, I believe that it is far too often used as an Aunt Sally by the Press. I welcome the subject of the debate. I find myself very much in agreement with the comments of the right hon. Member for Wanstead and Woodford. Those things needed to be said. Like him, I was impressed by the recent article by Hugo Young in The Sunday Times and the challenge that he presented to the political parties.
  The whole subject has some poignancy for me. This is because my father died in the early 1970s as a result of extensive power cuts in the London area, not, I hasten to add, because of a dispute in the NHS. Therefore, like, I am sure, other hon. Members, I know what can happen if power or heat is suddenly withdrawn, as might have happened again a fortnight ago. To put life at risk through a withdrawal of labour as a means to force through a settlement of a dispute can surely never be right. I personally cannot accept such actions. The hon. Member for Canterbury (Mr. Crouch) said as much last Friday week, and I very much agreed with him.
  That is one of the reasons why I could not support the firemen's strike. Whatever the merits of their case—and there may well have been merits in parts of the country—I could not see how decent men, normally so kindly disposed and to whom we owe a great deal, could withdraw their labour and put people's lives at risk. Such a case is, of course, far worse when it affects the National

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  Health Service. The sooner that we as a nation totally reject such action, the healthier the atmosphere will be in which discussions can take place. People's lives must not be put in jeopardy in this way.
  That is not to say that I do not appreciate the frustrations which are affecting all sections of the NHS. That includes doctors and consultants—and senior consultants certainly have frustrations, since it appears that junior hospital doctors are now earning more money than they are, which is another situation created because the Secretary of State was forced into an ill thought-out settlement two or three years ago. Nurses and engineers, too, have grounds for complaint.
  I found such action hard to accept when the consultants carried it out three years ago in withdrawing some of their services. I expressed the same view as the right hon. Member for Wanstead and Woodford apparently did to the consultants. That action was a dreadful example from professional people which I never expected to see in this country and which I hope never to see again.
  I am a great supporter of the National Health Service. Over the past weekend I seem to have been receiving nothing but calls from constituents telephoning me from private nursing homes or complaining about dentists who are withdrawing from the NHS. I went to a private nursing home in my constituency on Saturday afternoon to meet a constituent who has contributed for over 20 years to BUPA. He has been paying £250 to £260 a year to BUPA for help which now it is needed has not been forthcoming. He is not the only one to complain about this. A lady aged 72 telephoned me to inform me that my own dentist was about to go private. That means that I, too, shall have to leave his list. She told me "I have phoned up three dentists in the constituency but they cannot take me on. I cannot afford to pay dental fees."
  This is the other side of the story. I hope that the Conservative Party will realise what can happen if we do not take to heart the last words of the hon. Member for Ealing, North and provide a greater share of the nation's wealth for the NHS. We know that this country does not contribute as much to its health services as many other countries do to
  68
  theirs. We do not, for instance, give as must of our gross domestic product as does the United States. But, whatever the faults of our NHS, I could not accept living in a country where, for example, 40 per cent. of the bankruptcies in California arise from doctors pursuing their patients for their fees. That would be a dreadful situation to contemplate returning to. If, in order to get more money into the NHS, we have to put extra taxes on cigarettes and drink, I am all for it. Why on earth do we not do it?
  But the frustration comes not only through lack of money but through management procedures which have become more complicated and need to be simplified. I welcome the constructive remarks about this emanating from the right hon. Member for Wanstead and Woodford. He has been trying to tackle the situation in reports that we have seen in the newspapers. The Government, too, are beginning to see that there must be some amalgamations between areas and regions. This is all on the right lines. There will have to be changes in the administration of the NHS.
  Mr. Pavitt: In considering the question of resources and allocation, of course it is right that we should look not only to the global sum but to the way it is put out. 'Will the hon. Gentleman accept from me that when the Conservatives left office we were spending 4 per cent. of the gross national product on the NHS but now we are spending 6 per cent.—half as much again? But there is a limit to the amount of money one can find.
  Mr. Ross: Of course I agree that the problem is that this country must create more wealth as a nation and then we can devote more of that money to the things that we badly need. I disagree with the Conservative line that we can go on cutting public expenditure. I want to see more spent on things like hospitals, health services, roads, education, concessionary fares and so on. We have to be prepared as a nation to face up to the situation. For example, I also want better mental health facilities. I have paid two visits to Broadmoor, and I have been staggered by the dreadful lack of provision of mental health facilities, particularly for teenagers.

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  There also has to be a more realistic wage structure. It is true that the wages paid in the NHS are often below those which can be obtained outside. It is true in the case of the engineers, and it is certainly a reflection on our moral values that nurses are not paid as much as some secretaries in this House who are probably doing half the work that nurses do. These things are all true. We certainly need more surgeries and more operating theatres. We need to give more priority to these problems.
  The NHS was a wonderful concept. It must not be allowed to flounder through lack of funds or commitment on the part of the political parties. As a House, I believe that we should be able to agree on that. If the leadership can be given from this House that we intend to provide the resources needed by the Health Service, and that we intend to deal urgently with the anomalies, then the threats to life and limb will surely disappear.
  I am sure that hon. Members have seen the series of articles by Mr. Hugh Hebert which have appeared in The Guardian and which ended on Thursday. In the last paragraph of the last article he wrote:
  "A young enthusiastic doctor, who works in a crumbling Victorian pile far from London, said to me recently: 'What's right about the health service? The first thing that's right is that however poor or inarticulate a patient is, he can get treatment without money entering into it. That's a principle that's almost worth dying for. Cash doesn't enter into the doctor-patient relationship at all. And secondly, I have the right to give the patient the best treatment I can without thinking about the cost.' That remains true, however much or little money the NHS has—and the lesson of 30 years is that it will never have enough."
  I welcome those statements and they sum up my own sentiments entirely.
  5.11 p.m.
  Mr. William Hamilton: In all our debates on the NHS every speaker advocates either increased expenditure or a reallocation of existing expenditure. Only very rarely do we get down to the basic proposition which underlies the Health Service, which is that, in addition to what was quoted from The Guardian by the hon. Member for Isle of Wight (Mr. Ross), there is also the fact that the Health Service does not exist for the workers in it, whether doctors or
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  manual workers, but for the patients who are unfortunate enough to have to seek its help. Anything which threatens the welfare or the well-being of those patients must be frowned upon, and all steps must be taken by everyone concerned to eliminate the causes of those threats.
  Along with my hon. Friend the Member for Ealing, North (Mr. Molloy) I am a sponsored member of the Confederation of Health Service Employees. I bow to no one in saying without fear of qualification that from top to bottom the workers in the NHS, probably more than workers in any other service, are noteworthy for their selfless dedication. The industrial action about which we are all concerned at present must, nevertheless, be seen in its proper context. It really is minimal. When one looks at the history of the NHS over its 30 years, one will see that the amount of industrial action which has been engaged in quite properly has been fractional compared with any other industry or service throughout the length and breadth of the land.
  That is not to say that such industrial action is any the less serious when it occurs. However, as has been pointed out by several of my hon. Friends, if we are to be fair minded about this, we must emphasise that such industrial action as there has been has not been confined to manual workers. Some of the most reprehensible behaviour has been engaged in by the medicals—the consultants, the junior doctors and the rest. If we condemn the manual workers we ought not to smooth over the more reprehensible actions of the others, because the more well paid sections become, the more reprehensible for any action which they might take.
  Whenever such action occurs it inevitably hits the headlines. All too often Conservative newspapers and Tory politicians are more than eager to exploit these events for their own nefarious political purposes. My hon. Friend the Member for Brent, South (Mr. Pavitt) was quite right to castigate the right hon Member for Wanstead and Woodford (Mr. Jenkin). He made not even a veiled attack but an open, unconcealed attack on the trade unions, separately and collectively. As a sponsored Member, I take very strong exception to those attacks. There is no more responsible or moderate trade union operating within the Health

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  Service than the Confederation of Health Service Employees. It is dedicated to the preservation and improvement of the NHS, and nowhere more so than in the mental health service, the Cinderella of the Service. Yet the right hon. Gentleman chose to castigate in unequivocal terms every single union which is engaged within the NHS.
  He said that no plumber, no electrician, no cook, or anyone individually employed in the Health Service would seek to take action to jeopardise the welfare of any patient. But he then went on to say that collectively the consciences of the trade unions to which those people belong are somehow dulled. In other words, he was saying that the National Union of Public Employees, COHSE and the rest are prepared collectively to threaten the lives of patients. That is a squalid, indefensible and inexcusable charge which must be refuted by this House.
  The right hon. Gentleman went on to advance causes of the industrial unrest. He couched his proposals in fairly general terms. I suppose that was inevitable. I do not complain too much about that. I agree with him that there must be better management. It is very easy to make a general announcement of principle. But any faults there may be are highly likely to be the direct consequence of the reorganisation of the Health Service implemented by the previous Tory Government, who have a lot to answer for in this area. I hope that the Minister will refer to this and will indicate what progress is being made to remedy these grievances.
  The right hon. Member for Wanstead and Woodford made an interesting observation in this context. He said—and I quote the words which he used almost exactly verbatim, because I took them down—"If you treat people like dirt, they will behave like dirt". It was not very elegantly put, but it called to my mind a comment made some years ago by a very prominent, and by Tory standards very liberal, ex Tory Minister, now Lord Eccles, who used the expression:
  "Treat 'em mean and make 'em keen".
  That was the Tory philosophy which was carried out in practical terms within the Health Service in the early 1960s. The late Mr. Speaker, Lord Selwyn Llovd.
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  who was the then Chancellor of the Exchequer, was the man who sought to implement Tory incomes policy by first knocking the nurses on the head.
  The right hon. Member for Down, South (Mr. Powell) was at that time an ardent supporter of that same incomes policy which knocked the nurses. They were to get 3½ per cent. and no more. It must be remembered that at that time they received a tiny fraction of incomes which they are now receiving. Now, less than a week ago, the right hon. Lady the Leader of the Opposition no less, indicated that a future incomes policy of a Conservative Government will be much more stringent against people in the public sector than against people in the private sector. That means precisely the people about whom we are talking today. It means the nurses.
  According to the right hon. Lady, the 1 million workers in the Health Service will be the first for the knock. That is the clear implication of what she was saying. That, coupled with the Tory threats to make far more vicious cuts in public expenditure, not excluding the Health Service, as "The Right Approach" makes abundantly clear, will mean that the difficulties facing the National Health Service today, serious though they are, will be devastating if the Conservatives come to power.
  Dr. Vaughan: The hon. Member cannot get away with that.
  Mr. Hamilton: I was interested to overhear that interjection sotto voce—that I should not be allowed to get away with that—
  Dr. Vaughan: The hon. Member knows that what he is saying is totally misleading. Our party is pledged not to reduce resources in the National Health Service at all, and he knows that.
  Mr. Hamilton: The hon. Member had better re-read "The Right Approach". I think that I have probably read it more thoroughly and more often than he has. I know his party's policy better than he does. If he looks at the section on the Health Service he will see that it says that all the charges will go up. That means prescription charges, and charges for dental and optical services and so on.
  It also says that there are to be two services—an increased private provision

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  and a public sector. The right hon. Member for Leeds, North-East (Sir K. Joseph) has said that the public sector will include the Cinderella services—the geriatrics, and the mental patients—while the private sector will include all the others. In other words, we shall have two Health Services, and one will be able to go into the private sector only if one has the brass. [HON. MEMBERS: "No."]—I know the manifesto of the Tory Party, and I know that this is so.
  Dr. Vaughan rose—
  Mr. Hamilton: The hon. Member must curb his impatience.
  Dr. Vaughan: Where will these supposed cuts fall?
  Mr. Hamilton: I am telling the hon. Member where the cuts will be. If there are to be two services and one of them is a public service, obviously the public service will be the Cinderella. One can imagine all the public resources that a Tory Government, devoted to creating two services, would spend on geriatrics and mental health people. They will say "If you cannot pay the cash you will do without the service."
  There would be a division in the medical profession as well. The cream of the medical profession would go to the private sector and the public sector would once again be the Cinderella. Let nobody pretend about the issue of the National Health Service when the General Election comes along.
  The right hon. Member for Wanstead and Woodford ended with a rallying cry. He called for a Geneva Convention on the Health Service—come what may the patients will not suffer. By God, under the Tory proposals they would suffer. Those are fine words, but as has been said already, fine words butter no parsnips. We have on the record now in black and white what the Tory Party are committed to do within the Health Service.
  I end with a slight castigation of my own Front Bench. I agree entirely with those who have said that the Health Service in the last 30 years has suffered from financial restrictions of one kind and another. The basic principle of the service has been diluted by successive Governments—by the introduction of charges and so on.
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  The simple reason for that is that as a nation we have not been producing enough wealth to satisfy the growing demands on the Health Service, the services for which, whether it be the salary of a nurse or the cost of a drug, have increased in cost far more rapidly than our overall GNP. This is the basic reason for the troubles that are the subject of today's debate, not managerial procedure, or whatever. It is the frustrations created by the shortage of resources devoted to this magnificent service.
  I am very sorry that my right hon. Friend, the Secretary of State is in hospital. Nevertheless I say to him and his colleagues on the Front Bench that they are not as committed to the basic principles of the Health Service as I would like them to be. I would like my right hon. Friend to be bloody minded in the Cabinet Room. I think that he should demand more resources for the National Health Service. I fear that he does not do that with the kind of venom that is needed in his Department. That is the only way to get resources out of the Treasury. The Treasury is a mean-minded Department and one must be mean minded with it in order to get what one is entitled to. I fear that we have not got the venom or the conviction of a Nye Bevan at the moment. I fear that that is what we are suffering from at present, not the kind of shortcomings and trivialities to which we have devoted our time this afternoon.
  5.27 p.m.
  Mrs. Jill Knight: Indeed it is not only possible but likely that Conservatives are far more aware of what is in the Conservative manifesto than is the hon. Member for Fife, Central (Mr. Hamilton). Some of us simply cannot wait to put the Conservative manifesto in front of the electorate because we are confident that we shall gain support when we explain what we intend to do.
  Two tactics have been used by the Government Back-Bench speakers this afternoon. One is that they have taken the view that attack is the best method of defence, but they are trying to defend the indefensible. The other is to attempt to draw the fire from the main subject that we are debating. We are talking about the threat to patients from disputes in the National Health Service.

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  I was very pleased to read a few weeks ago that there were to be moves to formulate a code of practice. Although Members opposite may not be worried about the actions of the Health Service unions, persons within those unions are very worried. The suggestion of the code of practice came from a member of COHSE. He said that a code of practice must be formulated because it could not be tolerated in this country that sick people should be made to suffer from union disputes. I was pleased to see that a resolution was put forward to that effect and I was appalled when it was fiercely opposed and finally rejected. I could not believe that that was its fate. It seemed so reasonable and sensible for COHSE members to see that the public were becoming severely troubled about the way in which sick people were being made to suffer by these disputes.
  The hon. Member for Brent, South (Mr. Pavitt) said that we were in for an afternoon of union bashing. All I will say about that is that when unions ask for a bashing it is a cowardly politician indeed who fails to bash them. I have a great deal of support for the original principle of the trade unions in working for a fair day's pay in return for a fair day's work. That is very honourable. But what we are seeing today is the unacceptable face of trade unionism—trade unionism within the Health Service which has become heartless, totally selfish and cruel.
  Perhaps it is true that we used to have autocrats in the Health Service. But today we have tyrants. The old-time consultant was often an autocrat and so was the matron. What a pity that we have no more matrons—the patients have suffered from that. A godlike status was accorded to consultants but it was commensurate with their efforts in patient care. These were people who had studied for many years and had spent many more years acquiring experience. They gave freely of their time and expertise to help the sick.
  It was mentioned by the hon. Member for Brent, South that workers in the Health Service could get paid more money outside. In the early days, even before the NHS began, many cases were on record of consultants giving their time totally freely without any concern for hours worked, or the number of times
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  they were called upon day or night, or indeed whether they received any money at all for their services. Today's tyrants have no such qualifications or experience and show no readiness to give their time freely.
  Worst of all, today's tyrants have no regard for the patient. There are many cases on record in which operations have been put off by disputes within the NHS, leaving people in pain. Elderly and sick people have been moved about like pawns. Because of the dispute in one hospital they have been pulled out of that hospital and put in another in order to have their treatment continued. Many patients have been exposed to the lesser discomfort—but nevertheless a discomfort—of having no proper sheets or towels. Tiny babies have suffered grievously, some have even died.
  Many private patients have been victimised in petty and unkind ways. In some cases one has taken the view "How could people be so unkind to sick men and women just because they chose to go into hospital as private patients?" Many people decide to spend their money on health treatment rather than on beer, bingo or anything else, which apparently is quite acceptable to the Government. I do not think it right that sick people who choose to take what is left of their income after the tax man has had his slice and to spend it on private care should be victimised in the way that they so often have been.
  Today we have news that COHSE and NUPE have refused to allow the Royal College of Nursing to represent its members at pay talks. That is indefensible. The Royal College represents 105,000 nurses. The College was founded on 27th March 1916–62 years ago. Yet COHSE and NUPE want the College to be stripped of national and local negotiating rights just because it is not affiliated to the TUC. When did COHSE start? When did NUPE begin its operations? Certainly those bodies have nothing like the record of 62 years' service to nursing. It is appalling that those bodies should be so tyrannical in attempting to strip the College of its right to negotiate on behalf of its members.
  The Minister of State, Department of Health and Social Security (Mr. Roland Moyle): If the hon. Lady is seeking after knowledge and wants to know when the

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  National Union of Public Employees began, let me tell her that it began its operations about 1895.
  Mrs. Knight: If it commenced in about 1895, it must have been extremely inept. It had obviously then been going for many years when the Royal College of Nursing decided that something must be done and set up as a college. I am astonished to hear the date given by the Minister. Surely he is not suggesting that NUPE could have been competent, because if it had been competent there would have been no need in 1916 for the Royal College to be set up.
  The Royal College of Nursing has said "We will fight these undemocratic trade union moves to the bitter end." That demonstrates that there is a great deal of bad blood and friction between the Royal College and COHSE and NUPE. That can only be bad for the patients.
  I was recently hospitalised for a short time and I was shocked to see the standard of cleanliness in the wards. That standard has sadly fallen in recent years. I have since visited other hospitals and I have been sorry to notice similar low standards there. I made inquiries about cleaning. I was told that the hospital cleaner came into the ward in a desultory fashion, swept round the ward and left it, leaving many piles of dust quite untouched. When I asked why this was tolerated, I was given a rather strange reply. Surely hospitals of all places should be clean, but I was told that it was quite impossible to argue with the unions because, if there was any argument about the standard of cleanliness operated in the wards by the people who swept them, there would immediately be a strike. I was also told that when the cleaners went off it was the nurses who cleaned the wards themselves when conditions got too bad.
  Mr. Molloy: Nonsense.
  Mrs. Knight: The hon. Gentleman may not like to hear this, but these are the facts. He can check their veracity for himself. All this has been inconvenient for the nurses, and it is certainly not good for patients that standards have been allowed to slip so far.
  I should like to know how much trade unionism of this kind is costing the NHS
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  and whether that cost is avoidable. Some time ago my husband was hospitalised. He was desperately ill and I sat by his bedside for many hours. Over his bed was a socket for a lamp. There was no light for the simple reason that there was no bulb in the socket. The sister came in and said "We need that light on. Would you mind reaching out to switch it on?" I said "I'm sorry, sister, but there is no bulb in the socket." She bustled off and came back with a sheaf of forms which she proceeded to fill in. I asked "What are you doing?". She said "I am indenting for a light bulb." I asked "What does that involve?" She said "I fill in three forms and they get sent down to the electricians' department. Those requests w ill then be processed in the electricians' department and eventually a bulb will come up with the electrician carrying it and he will place it in the socket."
  I said "How long will all this take?" She said "It should not take more than about three days." I said "Please do not go to all that trouble. When I go out to lunch I shall bring a bulb back with me and place it in the socket myself." The sister blenched. She said "Please do not do that because there will be a strike at once." [HON. MEMBERS: "Never."] That is the absolute truth and I do not regard it as a laughing matter. Perhaps Labour Members are not competent to put an electric bulb in a socket, but I can assure them that the most inexperienced schoolboy or schoolgirl knows how to put a bulb in a socket.
  Why is it necessary for a highly paid electrician to be indented to cause him to have to come up to a ward to place a bulb in a light socket? One has only to bear in mind how many sockets there are in a hospital. This was a demand by the trade unions concerned that trade union members should be the only ones allowed to put an electric light bulb in a socket. I am all for electricians handling jobs that only electricians can do, but this is such a simple task. We read in today's newspapers that electricians in hospitals have had a wage rise bringing their basic money to £70 a week. I gather that this would mean an average payment of £80 a week. That appears to illustrate that it would cost almost £1 to replace a light bulb without even paying for the bulb. This is the type of

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  practice that we should have the sense to change, for it must be costing the NHS a great deal of money.
  Like my right hon. Friend the Member for Wanstead and Woodford (Mr. Jenkin), I am anxious that we should have more teamwork in hospitals. We demand that there should be no strikes in the NHS. My right hon. Friend rightly condemned all strike action, including that suggested on behalf of the junior hospital doctors. All strike action in hospitals is bad. All strike action that harms people is bad. If we say that there should be no strikes in the NHS, there is a duty on us all to see that people in the Health Service are paid a fair amount for the work they do and are treated as a team. That is the Opposition view and I shall be amazed if there are still Labour Members who will attempt to defend the indefensible.
  5.40 p.m.
  Mr. David Crouch: The House is indebted to my hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight) for her vivid description of something that is wrong in the provision of health care in hospitals. The story of the light bulb is not a laughing matter. I am not concerned about whose fault it is that forms have to be filled in before a light bulb can be provided, but I am sure that the Minister knows that such problems exist.
  There are bureaucratic barriers which must be removed and my hon. Friend the Member fo Edgbaston was right to colour her argument with such a vivid story, which was so close to her at an anxious time in her life and her husband's life. She was talking about patients and that is what the debate is about. It is not about the 1 million people who serve in the NHS. It is about the millions of people served by them—the sick and the dying.
  There are great problems in the National Health Service. Every speaker has admitted that fact. There are problems for all those working in the NHS, which is the biggest industrial enterprise in Britain today. Great problems face them all, whether they are administrators at the top of the tree, top consultants or those at the lower end of the delivery of health care. There are also problems for
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  those who want a service from the NHS, but I wish to direct my remarks to the problems of those working in the Service. Let us examine what has sometimes driven them over the limit of what we are prepared to stand for as a society.
  Sometimes the strains on NHS employees have been almost too much for them to endure. They have resulted from inadequate pay and excessive burdens at work. Hon. Members have mentioned the consultants and the junior doctors, but no one has referred to the enormous strains imposed on young housemen in the first year after they qualify as doctors. Sometimes they work 160 hours a week—impossible hours in any other enterprise, but allowed in the National Health Service. These strains have been sorted out as a result of the junior housemen going to the limit in pressing their demands. I do not agree that they should have gone to those limits and I entirely agree with what my right hon. Friend the Member for Wanstead and Woodford (Mr. Jenkin) said about their action. But they revealed the impossible burden put on them in their first year of work as doctors.
  Many other strains exist for those working in the NHS, apart from the question of overtime and excessive work. There are problems produced by staff shortage. Hospitals work far below their establishments of nurses and other essential services. In some hospitals, working conditions do not match up to the requirements of modern factory Acts. There are some hospitals where even the sanitation provisions are not up to the level found in modern offices and factories. Such are the conditions in the nineteenth century hospitals in which so many people have to care for the sick and do their best to carry out their jobs efficiently.
  The problems and strains apply to almost everyone in the NHS, whether they are consultants, registrars, nurses, radiographers, scientific and technical officers, electricians, plumbers, ambulancemen, orderlies, porters, catering staff, cleaners or clerical and administrative staff. In these days of inflation and the under-funding of our Health Service, it is understandable that employees in the NHS feel frustrated and, at times, very angry indeed. Like the rest of us, they have to keep up with inflation and face up to its problems. They are married

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  people with children to educate, feed and clothe. They have the problems of living in these days of inflation.
  I have heard many people say that inflation is evil. We have seen the evil that inflation can breed in an area of society where compassion should be the overriding priority and, at base, still is the overriding priority. We see inflation producing an evil that bursts out every now and again and hurts the good name of the British National Health Service. Like everyone else, people in the NHS want to keep up with the Joneses and we should not say that they should not be able to keep up with the Joneses.
  I declare an interest because I serve on a regional health authority and I am a director of a pharmaceutical company. The management in the Health Service must recognise the desires and aspirations of everyone working in the NHS. My right hon. Friend the Member for Wan-stead and Woodford was right to speak of the need for better management and procedures and for the removal of the sort of bureaucratic barriers that were illustrated so well by my hon. Friend the Member for Edgbaston.
  Mr. Molloy: Those barriers were set up by the right hon. Member for Leeds, North-East (Sir K. Joseph).
  Mr. Crouch: Let us not argue about who created the barriers. Parliament created the barriers and produced certain problems. I work in the service and I do not suggest that all the problems in the NHS stem from the type of management that we have in it. However, I claim that many of our problems stem from inadequacy in management, which is a different thing altogether.
  Management in the NHS must not rest on its laurels and on the feeling that the spirit of dedication of doctors, nurses and others in the service will ensure that there is less urgency about their problems than about those in other areas of public service or in industry. We must not draw on the reservoir of good will and the deposits of dedication to service of the sick. Nothing less than good management will do if we are to correct the problems of the NHS.
  However, just as management must not trade on dedication, no one who works in the Health Service serving the sick must trade the patients in any dispute
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  concerning pay and conditions. The patients must never be allowed to become bargaining counters in these material arguments. As I have already said, material arguments are important. We must recognise that they exist. We must understand them and seek a solution to them. But we must never allow the patients to become bargaining counters and to be traded against other issues in disputes.
  We have a duty to remind everyone in the National Health Service that the patient must be above disputes. The patient must be the first concern of those who work in the National Health Service, and the patient must also be our first concern. The public must recognise this fact. Parliament—let alone the Minister and the Government—has a duty to establish clearly, for the whole of our society to see, that the patient comes first, without conditions.
  Let Parliament establish something else from this short debate today—that strikes and picket lines will have no place in our hospitals. If we were to reach the stage where they had a place, we should have reached the end of the road. I am not prepared to accept that. We have a responsibility to bring home to everyone, in and out of the NHS—
  Mr. Molloy: What does the hon. Gentleman mean by "out of the NHS"?
  Mr. Crouch: I am referring to those who work in the NHS and the general body of the public—everyone in this country. We must establish that hospital closures and shut-downs put lives at risk. This was revealed clearly in the hospital dispute the other day in London. It arose out of a very understandable concern on the part of electricians and plumbers at not being able to keep pace with inflation. That dispute was eventually solved by the intervention of the Government, and by the skill of the Minister of State and the skill of the Secretary of State. We know that the Secretary of State is a sick man. We send him our best wishes today and hope that he will soon be out of hospital and back with us.
  I give credit to the Government for the way in which they were able to solve that dispute rapidly, but I also give credit somewhere else. The matter was aired in Parliament one Friday morning. The Secretary of State came to the House

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  and made a statement about his belief and the Government's belief that there is no place for strikes and picket lines in the NHS. He said that lives would be at stake. It was a dramatic statement. It was heard throughout the country and it was heard in the union concerned.
  I never had any doubt that the union, which had always been reasonable in the past in its approach to these matters, would recognise that it must not trade a patient's life—not even one patient's life —in the bargain that it was seeking to drive. I am glad to say that when Parliament spoke with a strong voice, with strong leadership from the Secretary of State, the union listened, because the public was behind the Government and behind Parliament.
  The position was made clear in this House, and one could feel it in the country. It was not just the headlines in the Press. The mood was reflected in a feeling that, having gone to the brink, this was too far. The Secretary of State will no doubt read tomorrow what has been said in this debate. I take my hat off to him for having stood up and answered some very tough questioning, and for giving a lead in the way that he did.
  I do not believe that the message is a difficult one to put over. I believe in the dedication of those who serve the sick. I believe that they are all prepared, from the top to the bottom, to accept this limitation on their opportunities for industrial action. I am sure that this was recognised when the Secretary of State gave a lead a fortnight ago. He must give another lead. He must make clear, across the length and breadth of the NHS, to all the varieties of representation which exist, from the consultants down to the porters, that they must all accept and agree that there are now unwritten codes of behaviour in regard to pressing a case or a claim in the National Health Service, because patients and patients' lives are at stake.
  Mr. Molloy: I am grateful to the hon. Gentleman for giving way. I agree with nearly everything that he has said. Now that I have agreed with him, I hope that he will agree with me that what irritates many young doctors, nurses and auxiliary workers is that some people are jumping
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  the queue and occupying beds which ought to be occupied by more deserving people. These young doctors, nurses and auxiliary workers, with their dedication to the National Health Service, are greatly irritated when people are admitted to hospital not on the basis of priority but because they can pay the money.
  Mr. Crouch: I know the point that the hon. Gentleman has made. It has been made frequently over the last two or three years. His Government have been fighting very hard to eliminate all private patients. I cannot support him on this point. I am sorry.
  I want to get on to another aspect which relates to the whole of society. I want the Secretary of State, the Minister of State, and their officials, and also the members and officials of health authorities, to get out more into the field, so that they may see what happens where the battle is taking place. I want them to see what it is like at the place where patients are cared for—in the hospitals, in the health centres, at the general practitioners' surgeries, and so on. I want them to see what happens at all these places in which a million people are working in the NHS to look after the sick, the anxious, the very ill and the disabled. It will help enormously if the Secretary of State will give this lead to all those who work under him, from the permanent secretary downwards. I hope that they will urge people to get out into the the field, so that they may see on the spot what is happening.
  Mr. Moyle: I should not like the hon. Gentleman to mislead the House. I am anxious to find out what suggestions he has, but I should like him to know that at the moment I go out into the National Health Service on at least one day a week, sometimes two. Whenever I do so I talk to the staff side as well as to the management. It would be very difficult for me to do my job here if I were to do any more visiting.
  Mr. Crouch: The Minister has anticipated what I was about to say. I am asking the Secretary of State and the Minister of State to go on giving this lead, but to ensure that their lead is followed by their officials.
  Mr. Molloy: Hear, hear.
  Mr. Crouch: I hope that their lead will be followed by their officials in Alexander Fleming House and their officials in the 14 regions and 90 areas in England and Wales—and also in Scotland—to ensure that those who deliver health care, the doctors, the consultants, the nurses, the radiographers, the ancillary workers, the porters, and everyone involved, will see that management and administrators are interested in what they are doing and are in a position to hear about their problems. I want to see the administrators getting much closer to those who work in the NHS and closer to the patients.
  I learned more about health care and about the dedication of the doctors, consultants, nurses, cleaners and everybody in the NHS, when my wife was in Guy's hospital for a fortnight in a public ward built in about 1860, than I learned in eight years working in the NHS as a remote administrator. I learned by being able 10 see for myself on the spot, rather than being concerned with paper work, the re-allocation of resources, and so on.
  I believe that administrators of all sorts have become remote—or, at least, have often seemed to become remote—from those who are working in the field. A closer understanding between administrators and the men and women working at the point of delivery of health care—if I may use that complicated, almost legal, phrase—would lead to better management.
  In my opinion, the NHS as underfunded. It is short of money. It seems to be over-managed. It does not seem to be short of administrators. But the real problem is none of those things. The real problem is one of frustration that it is being taken for granted, frustration that it is being overlooked. We must tackle this problem and correct it. We must never allow the patient to be overlooked and put at risk.
  6.0 p.m.
  Mr. A. P. Costain: I am sure that the House must contrast the speech made by my hon. Friend the Member for Canterbury (Mr. Crouch), who has practical experience in the hospital service, with the most extraordinary speeches from the Government side of the House. We have heard the Conservative doctrine on the National
  86
  Health Service a là West Fife. There have been interruptions from the hon. Member for Ealing, North (Mr. Molloy) which sound like political commercials. He talks a lot about private beds.
  My hon. Friend the Member for Canterbury referred to the Secretary of State being in hospital. The hon. Member for Ealing, North used that as an excuse to interrupt. We wish the Secretary of State well and hope that he is soon back in the House. Is the hon. Member for Ealing, North trying to persuade the House that the Secretary of State did not receive priority in order to get a bed in hospital? Is he suggesting that the Secretary of State's illness was any more serious than the illnesses of others on the hospital waiting list? The Secretary of State and his predecessor received priority.
  Mr. Pavitt: Anyone with a thrombosis is admitted to hospital immediately, whether he is a Minister or anyone else.
  Mr. Costain: I doubt that. Some of my constituents with thrombosis are not admitted immediately. I do not suggest that the Secretary of State should not have been given a hospital bed. But I am fed up with Labour Members saying that a Minister should have priority whereas anyone with money should not. That is what is wrong with the argument.
  Mr. Molloy: Will the hon. Member give way?
  Mr. Costain: The hon. Member is always interrupting.
  Mr. Molloy: On a point of order, Mr. Deputy Speaker. The hon. Member for Folkestone and Hythe (Mr. Costain) asked me a question. In my normal, courteous way, I thought that I should try to enlighten him but he refuses to be enlightened.
  Mr. Deputy Speaker (Mr. Bryant Godman Irvine): This is a normal debating point. Unless the hon. Member for Folkestone and Hythe (Mr. Costain) says something derogatory about the hon. Member for Ealing, North (Mr. Molloy), he has no right to intervene.
  Mr. Costain: I do not wish to say anything derogatory about the hon. Member for Ealing, North. The hon. Member

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  interrupts every day. He sounds like the same gramophone record. He always asks how the Opposition will save money. My hon. Friend the Member for Canterbury and I sit on the Public Accounts Committee. In the last four years we have considered hospital expenditure. On a recent visit to Liverpool we saw how hospital expenditure has gone through the roof. We saw how £30 million had been overspent. Only when the Public Accounts Committee became involved was £14 million cut off that expenditure. We are talking about saving substantial amounts of money, not chicken feed. The Committee is an all-party Committee. Members of the Labour Party agreed that those savings should be made. The hon. Member for Ealing, North should not make political points about this subject.
  The debate is about how we can give a better service to patients. Since I am a Member of the Chairmen's Panel I hope that the House will forgive me if I stick to the issue in hand. We are talking about whether anyone has the right to strike and thereby put peoples lives at risk.
  Once upon a time strikes were called in order to make life more difficult for the boss. The boss would lose money through a strike and there was a reason for calling a strike. At one time people went on strike because they believed that it would put the boss's money at risk. Today in the large industries where strikes are most common it is not the boss's money which is at risk. It is not even the shareholders' money. It is the taxpayers' money. There is therefore less reason to strike.
  When there is a strike on the railways, who suffers? It is the poor people waiting on Folkestone station in the snow when the driver does not turn out because he is having a row. Today we are talking about those who suffer, who are on the point of dying or ill, because some bloody-minded porter decides that he does not like a pretty girl being treated in a private ward when his wife is waiting for a hospital bed.
  Liverpool teaching hospital is not to be opened because a row is in progress. About £5 million has been spent and
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  there is a row about whether, when this hospital opens, others will close and some people will lost their jobs. That hospital costs £45 million to build. The interest on that money and the depreciation on it involves the fantastic sum of £10 million a year. Every day that that hospital does not open, taxpayers' money is being used, not to provide a service, but for an argument about why it should not open. People argue that my wife, my daughter or my grandchild might be involved. But is that an argument for opening or not opening this hospital?
  This is the moment to make an appeal to those who are affected. It is not the time to make party political points or to base an argument on who started the Health Service. We know who started the Health Service—the National Government. We know who reorganised the hospitals. Some of us did not agree with what happened then. But this bunch has had nearly four years in which to put right our mistakes.
  Many improvements are spoiled by bureaucracy. Many of my friends are nurses. I have been told by an eminent theatre sister that she joined the hospital service in order to save lives. She says that she used to have enormous job satisfaction by saving someone's life. But now that she is at the top of her profession she spends each day filling in forms. This theatre sister at a well-known London hospital is browned off with form filling.
  The hon. Member for the Isle of Wight (Mr. Ross) mentioned private dentists. My own dentist—and I hope that he does not hear this debate, because I have to see him shortly—has told me that he no longer takes National Health Service patients because he is so sick of filling in forms and explaining his treatment to non-professional people who think that they know more about his patients' mouths than he does. He says that he is now going back to square one and treating private patients only.
  If we want to get the service which both sides of the House know is needed—this is what the debate is about—we must make a special appeal. Strikes are out of place. Everyone should get together and organise things properly so that they are not necessary.
  6.10 p.m.
  Mr. Robin Hodgson: My hon. Friend the Member for Folkestone and Hythe (Mr. Costain) has demonstrated and underlined the capacity of hon. Members on the Government Benches to avoid facing unpleasant facts. We have heard a series of speeches from them, on the one hand, about industrial relations troubles in the National Health Service being only figments of Tory imagination, or, on the other hand, when the facts are shown to be proved, telling us that it is just Tory pre-election propaganda. However the truth is well-known to all Members when they go to their constituencies. People tell us about the problems and difficulties being faced in the hospital service.
  Although we have heard speeches today referring to the big official disputes, I wish to concentrate on the distressing increase in niggling disputes, disputes which result not in a withdrawal of labour but in work-to-rule, large-scale absenteeism and other forms of unofficial action.
  We have had a number of examples of that type of dispute in the West Midlands, and I shall cite two. Neither is of the kind likely to lead to the death of patients, but a great deal of inconvenience is caused. First, there has been a work-to-rule by telephonists. For a time, they were prepared to connect only critical medical telephone calls. They seemed to pay no heed to the effect which such a decision would have on relatives anxious to find out how patients were after operations or treatment of some kind or other. I had the experience myself of telephoning to one of my local hospitals to discuss the matter. After I got through to the appropriate department, a voice came on the line to say "You are not having an urgent telephone conversation" and the next I knew was holding a buzzing disconnected telephone. This is not satisfactory, and such action does not take enough account of people's fears when their relatives are in hospital.
  My second example relates to the local ambulance service. I am speaking here not about the emergency ambulance service but about ambulances which take people, usually elderly people, for outpatient treatment—physiotherapy and so forth. We have had a rash of cases of
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  ambulance men either not bothering to pick up patients or, alternatively, picking them up so late that they are too late for their appointments.
  My community health council in Walsall has asked the physiotherapy departments at the local hospital to keep a record of these cases, but it has been told that it would not be in the public interest for them to have such a record. This leads local people to believe that the authorities in the National Health Service are not prepared to face up to the difficulties of industrial relations troubles.
  Why have these niggling disputes and problems becomes so prevalent? My hypothesis is that there are two major reasons. First, there is the question of union rivalry between COSHE, NALGO and NUPE, with each union trying to increase its relative membership in the NHS and, to this end, bidding for members and appearing to be aggressive and strident on the workers' behalf.
  I understand that the code of conduct now under consideration has so far been seen in terms of the unions vis-à-vis the NHS. I hope that there will be some provision for inter-union codes of conduct in an effort to prevent the demarcation troubles and poaching between unions which has led to a bidding-up attitude among local union organisers.
  Secondly, there is the question of pay, career structure and working conditions, especially working conditions, for many non-medical staff in the NHS. Working conditions in many places are undoubtedly poor. The Minister has been to Walsall. Walsall is a typical example of a place with poor working conditions, and I can well understand why many of the workers find them thoroughly unsatisfactory.
  Obviously, that state of affairs can be put right only by an increase in resources, but we must understand that the NHS slice of the overall cake cannot be made larger. Taxation is already too high, and incentives are already too low. Although we are all agreed that we must increase the rate of wealth creation, we cannot do so if we increase the burden of general taxation.
  Therefore, we must try to improve the use of existing resources, using them more effectively to improve working conditions and thereby cut down the number of niggling disputes. Such an

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  approach demands imagination at all levels within the NHS, but this is a task in which all who work in the Health Service—I pay unreserved tribute to them —could wholeheartedly join.
  I return now to what was said by my hon. Friend the Member for Folkestone and Hythe. It was disappointing that we hardly heard a word from the Government side about positive ways of improving resource utilisation or improving working conditions and employer-employee relations within the Health Service. We have heard all the old shibboleths and mythology trotted out for the nth time.
  I hope therefore that, instead of resorting to the sad tired old clichés about union bashing, the Minister will make clear that the Government realise that industrial relations in the National Health Service are unsatisfactory and give cause for public concern. Instead of pursuing a vendetta against pay beds, the Government should look at all the various ways of increasing the revenue of the National Health Service, which we all know is desperately needed. Instead of running away from union power, the Government should remind NHS workers of their duty—their Hippocratic duty—to patients, whose safety and comfort are paramount. I hope that the Government will be more decisive on this issue now than they have been in the past.
  6.17 p.m.
  Mr. Peter Bottomley: I shall make two brief points. First, I refer to a group of NHS workers, school health nurses and tuberculosis visitors, who were heavily penalised by the Halsbury report several years ago. Many had worked for 20 years without certification because they started before certificates came in, and they were put at a penalty of over £1,000 a year. Although it took three years for the Government to find the opportunity to make sure that these hard-working and long-serving NHS employees came back on to the right salary scale, they did not take industrial action and did not even threaten it. That is another side to the issue under debate which ought to be brought out.
  Secondly, I refer to the stay at my Eltham and Mottingham hospital. They are under great strain at the moment and
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  under great temptation to start issuing threats of one kind or another. Their hospital has been recommended for closure by the regional health authority. Public opinion is on their side. The area health authority and the community health council want to keep the hospital going. Yet, here again, these workers have not issued a word of threat, blackmail or anything of the kind. Their concern is for their patients, as was the concern of the school health nurses and tuberculosis visitors. In a debate of this kind, it is important that such examples be brought out and emphasised.
  Mr. Pavitt: Hear, hear.
  6.18 p.m.
  Mr. Christopher Price: I am grateful to the Opposition Front Bench spokesman, the hon. Member for Reading, South (Dr. Vaughan) for giving me a minute or so of his time. I have heard most of the debate, and I feel that it should be said that, if what emerges from the debate is no more than a succession of union-bashing arguments, that ought not to be our final conclusion. I take at face value the Opposition's desire not to use the debate simply to get at the Health Service unions, and I think that it should be made clear that the majority of the difficult disputes in the NHS at the moment stem from a genuine effort on the part of members of unions to improve the lot of patients, not their own lot.
  The dispute at St. Augustine's hospital in Canterbury arose simply because some young nurses felt that the patients had a raw deal and that the administration was just sitting on top of them. The dispute which has been going on in Greenwich has nothing to do with nurses trying to get more money for themselves. It is a genuine argument about who does what in operating theatres. The dispute at King's College hospital, which we have seen discussed on television, has nothing to do with Health Service workers being greedy and wanting more money for themselves. It arises from a genuine argument between doctors and nurses about how full a hospital can be and still operate properly.
  In the light of some of the comments which we have heard from the Opposition, loading all the responsibility for

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  these problems on COHSE, NUPE and NALGO, the record should be put straight. Most of the problems which come up in the NHS arise from a lack of money, from genuine demarcation disputes and, in some cases, from appalling management. If there is militancy, that militancy was led by the consultants and the junior hospital doctors some time ago. I hope that that spirit will be reflected in both winding-up speeches.
  6.19 p.m.
  Dr. Gerard Vaughan: The news that the Secretary of State was still unwell was very sad. I add my wishes, again, for his rapid recovery.
  It is also very sad that we have needed to put down a subject such as this for debate this evening, because the Opposition are deeply concerned about the very rapidly falling standards of care in the NHS, and it is the care of patients that we are talking about.
  Also, I thought that it was very sad that the hon. Member for Brent, South (Mr. Pavitt) immediately started to divide the House and suggested that all was well on the part of the unions and that all was wrong in what we had been saying.
  Mr. Pavitt: The hon. Member was not listening.
  Dr. Vaughan: I was listening very carefully. I thought it was particularly sad when the hon. Member said that this debate was about the rights of workers. He never, at any moment, said that this debate was about the rights of patients. That, I am afraid, shows the kind of thinking which most Labour Members have shown in the debate.
  In fact, it was my hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight) and my hon. Friend the Member for Canterbury (Mr. Crouch) who first brought up the question of the needs of patients. My hon. Friend the Member for Folkestone and Hythe (Mr. Costain) brought us back to the realities of the situation and the needs of patients. That is what this debate is all about. My right hon. Friend the Member for Wanstead and Woodford (Mr. Jenkin) put the position very fairly and very clearly when he listed over and over again the kinds of damage now being done by industrial disputes within the Health Service.
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  The Minister said that he has been visiting hospitals. So have I. Most hon. Members know this. I have been visiting a lot of hospitals recently. I find that there is hardly a hospital today which is not restricted in some way by industrial disputes of one kind or another. They do not all hit the headlines. But over and over again, when I talk to hospital staff, they tell me that they cannot do this or they cannot do that because there has been a threat of industrial action.
  My hon. Friend the Member for Woking (Mr. Onslow) has a list of 36 hospitals where admissions are restricted. As he knows from my intervention, I could give him a very long list indeed of other hospitals which do not appear on that list of his, where the admission of patients is now being handicapped by industrial action. I have mentioned one just round the corner from here. We heard last week about problems in the Bristol area, in the West Country. We hear this over and over again. This is what I am finding when I travel around the country.
  The administrative staff are frightened to take action against these restrictions because they have so many problems in keeping the hospitals going that they do not want to add extra problems by arguments about tiny union actions of one sort or another.
  For the first time in my life, I am now meeting patients who are seriously afraid to go into hospital—not because of the medical treatment that they will receive, but because they are afraid that they will suffer from some sort of industrial action.
  That brings me to one of the other things that the hon. Member for Brent, South tried to do. He tried to suggest that what we were saying was unreal and that it was not happening. That is not the case. I would ask the hon. Gentleman to turn his considerable talents and knowledge of the Health Service to looking at what is going on today.
  I shall not go through a long list of examples. My right hon. Friend gave a very clear account of industrial action of one sort or another. But with this background in mind, it seems incredible that on 22nd June the general secretary of COHSE, Mr. Albert Spanswick, should tell the union's annual conference that the care of patients was always the union's

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  number one priority. Then he went on to make what, in my view, was an even more unreal statement. He said:
  "No one has ever suffered as a result of industrial action by members of this union."
  I cannot accept that, having regard to the information I receive from the people whom I meet. I would ask him where he is getting his information from, because he must be out of touch with his own union members.
  I was rather disappointed that the Minister, although it is his right, chose not to speak until the end of the debate, because I thought that many hon. Members would have liked to ask him questions and to comment on his statements. I hope that when he winds up this debate he will deal with the whole range of questions which we have put to him.
  Mr. Moyle: I received absolutely no representations, to the effect of what the hon. Gentleman has just said, before this debate started. I decided that if I spoke only once one or two extra Back Bench Members could speak. I thought that, if I was to be the only Minister to speak, I would speak last. That is the background of the arrangements for this debate.
  Dr. Vaughan: For that reason also I propose to keep my remarks very short, so that the Minister will, I hope, have ample time to answer every point that we have put to him.
  What about the patients who have been refused admission recently? Some of them will die; there is no question about that. What about the patients who have been sent back from operating theatres? What about the enormous increase in the waiting time for urgent investigations? What about the child who died the other day waiting to have her heart investigated? She was not waiting for the operation; she was waiting for the investigations which would have led to the operation. Is that right?
  I suggest to Labour Members that they should examine their consciences and look very closely at what is happening in the Health Service, because there is an opportunity for both sides of this House to combine with ideas, nonparty ideas, on how to bring the NHS back on to its feet.
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  I do not think that it helps—and I am sorry to say this in his absence—for the Secretary of State to choose to assume that these problems do not exist. We have said this to the Secretary of State before. In January this year he did enormous damage to his credibility and to the credibility of the Government when on a major television programme he said that there was no such thing as long waits for investigation, and that if there were cases waiting more than five months he would like to hear about them. They are commonplace.
  It was shortly after that that we heard that, for example, in my area, 60 per cent. to 70 per cent. of cases are having to wait over a month as a routine for urgent investigations.
  I refer to a passage in Hansard, when the Secretary of State said that, by referring to widespread industrial unrest in the National Health Service, I was "trouble-making". Surely it is not trouble-making to say to the Minister ultimately responsible "We have this situation today. We know that it is going on. What are you, the Minister in charge, prepared to do about it?" That is not trouble-making. That, I suggest, is reality.
  I have referred to the Minister the comments of Miss Catherine Hall, the general secretary of the Royal College of Nursing. She is a most cautious woman, a most moderate woman by any standards. Yet she had to say the other day that the standards of nursing care in this country had now fallen dangerously low and that we had hit the lowest level ever of morale in the nursing profession. I know that the same applies in the medical profession.
  Mr. William Hamilton: Not true.
  Dr. Vaughan: That is what she said. That is what the nurses tell us.
  Mr. Hamilton: It is not true.
  Dr. Vaughan: That is what the doctors say. The hon. Gentleman does not want to believe it is true because it does not fit in with his doctrine.
  Mr. Hamilton: It fits in with yours.
  Dr. Vaughan: Why not have a nonparty approach to this disastrous situation?

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  This week we are asked to celebrate what appears to most of us a rather sick farce-30 years of the National Health Service. I think it is ludicrous. After four and a half years of Socialist management, or mismanagement, the situation is the worst that we have ever known. That celebration is nothing more than a publicity exercise which has backfired on the Government. Now they can neither cancel it, because it is inappropriate, nor go ahead with it realistically and sensibly.
  As my right hon. Friend said, the centrepiece of this week has gone. It was to have been the announcement of a code of practice—a kind of non-medical Hippocratic oath. It was to have been the beginning of a new era in the NHS. Apparently, only the nurses are prepared to sign. We believe not only that a code of practice is essential in health but that it can be achieved.
  Our advice to the Government is that they should continue—I hope that they will do so seriously—with their discussions on this matter. They should take more notice of the words of people actually working with patients. Some of the speakers at the COHSE conference were clearly unaware of what is going on—
  Mr. William Hamilton: Practising nurses? How can the hon. Member honestly say that?
  Dr. Vaughan: What about the porter at Greenwich who said on television the other day that there was a need for proper decisions to be made in the NHS, that lie was seeking proper orders and instructions about what to do because there was so much confusion?
  The Secretary of State should use his influence to stop the unions turning, for example, on the Royal College of Nursing, attempting to deny it negotiating rights on behalf of its members. That kind of inter-staff warfare will do nothing for the NHS and will damage still further the care of patients. The nurses will resent that. We understand their feelings and we support them.
  The Secretary of State should listen much more to what we are saying, and should accept our view that the NHS
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  will not function unless decisions can be made locally, quickly and easily once again. He should accept that we want to restore the NHS as much as he does, that we want a service which is in touch again with the needs of patients and with the local community.
  I suggest four steps that the right lion. Gentleman should take. First, we should like him to condemn over and over again any kind of strike action within the NHS. We have condemned it by junior doctors and consultants, we condemned it by dentists and we condemn it by porters, telephonists and all the other staffs. In our view, there is no place for militant action in the care of the sick. We believe that today we need a kind of Hippocratic oath not just for doctors but for everyone working in health care.
  Secondly, we ask the right hon. Gentleman to continue much more forcefully than he has so far with his attempts to draw up a proper code of behaviour.
  Thirdly, we ask the right hon. Gentleman to recognise that professional groups such as nurses have a right to take part in consultations and to speak out firmly and clearly on their behalf to say that he will have no truck with inter-union strife, by which they want to bully the nurses out of the negotiating table, room and the conference hall.
  Mr. Pavitt: The Royal College is represented on the Whitley Council and there is no pressure for change there.
  Dr. Vaughan: They are trying to get rid of them. The hon. Member should know that if he reads the papers.
  Finally, we would ask the Government to make it possible once again for professional staff in hospitals to get on with the job for which they are trained. That means fewer committees, less interference on all sides and a simplification of the administrative structure.
  To say that we introduced that structure is no answer, because the Government have had four-and-a-half years to change it. What do they intend to do about the breakdown in the NHS? They are the people responsible for it at the moment. I ask them not only to be aware of and to admit the problems but to tell us what they will do about them. The whole situation is now desperately urgent.
  6.36 p.m.
  The Minister of State, Department of Health and Social Security (Mr. Roland Moyle): I should first like to thank all those hon. Members who have wished the Secretary of State well in his treatment in hospital and have added a wish for his speedy return to us. Naturally, I should like to associate myself and my hon. Friends with that sentiment.
  We have had an interesting debate, although not all the subjects raised have been directly concerned with industrial relations in the National Health Service, which I take it is the purpose of this debate. However, I shall do my best to answer most of the industrial relations points and the other points so far as they relate to industrial relations.
  I want to dispose of one subject immediately—the organisation of the NHS. It is no use the hon. Member for Reading, South (Dr. Vaughan) saying that we are trying to dodge the issue when we talk about the Tory reorganisation. We have tried to repair the damage with which we were left—not just by the right hon. Member for Leeds, North-East (Sir K. Joseph) but by all his colleagues in government. It was right hon. Ladies and Gentlemen opposite who imposed the present organisation on the NHS. It is we who have had to try to struggle with the problems they left us.
  The hon. Member for Reading, South spoke about decisions being made locally, quickly and easily. One reason that that is difficult to achieve in the present-day Health Service is that he and his right hon. Friends imposed on the service the existing bureaucratic structure. It is no use Tory Members giving us advice on what should be done with the NHS for the future, because there is no subject on which the Tory Party so lacks credibility in the country as their comments about the future organisation of the NHS. They have forfeited any claims to expertise by allowing the proof of their pudding to be eaten.
  Dr. Vaughan: What have you done?
  Mr. Moyle: What we have done, among a number of short term palliative measures—including restricting the numbers of managers, holding back management costs and amalgamating districts into single district areas—is to set up the
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  Royal Commission on the National Health Service, so that we shall have a good, sound, properly informed basis for reorganising the NHS. When we do so, we shall not make the mistake that the Tories made of imposing a D-day on the NHS by which all the troops had to march off to their new positions. Change when it comes will come at a pace which can be absorbed by the NHS. That is the lesson that we have learned.
  In the meantime, I see that the Tories have not lost their desire to fly by the seat of their pants. That is the trouble with making suggestions about abolishing various parts of the NHS instead of waiting for proper advice. My advice to them is to wait for the Royal Commission, follow it through and take part in the debate then.
  But all this is largely irrelevant to the subject of the debate. [HON. MEMBERS: "Hear, hear."] It was not I who raised the matter first, and I was asked specifically by the hon. Member for Reading, South to answer all the points which had been raised. I am now doing so.
  The problem that we are discussing is industrial relations in the NHS. I think that we can all agree on one proposition anyway—that any dispute in the NHS is bound to call into question to a greater or lesser extent the interests of patients. Regrettably, disputes do occur in the ranks in the NHS. I had hoped that we could devote most of this afternoon's debate not to a rehearsal of grievances, which is what many of the contributions of the Opposition have amounted to, but to trying to sort out workable solutions to the problems under discussion.
  First, we ought to look at the facts and get the whole problem into perspective. The NHS costs £6 billion per annum and employs 1 million staff. About three-quarters of that sum of £6 billion is spent on the staff, and that covers a wide range of professions and trades. Good industrial relations are essential in an organisation of this sort, because it is extremely labour-intensive, as I have said, and the quality of service to the patient depends on harmonious co-operation between a tremendous range of professions, crafts and occupations. It is a large and diverse work force in which there has to be cooperation between the various sections. It is an organisation that is probably

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  more complex and less homogeneous than almost any other organisation of comparable size, certainly in this country, and probably in most others too.
  A patient can be affected by industrial action on the part of any of those staff groups—whether doctors or ancillaries—or by a dispute between different staff groups, and sometimes they can he affected by industrial action by workers outside the NHS which disrupts services to patients. The NHS is particularly vulnerable to the latter kind of disruption because by its very nature, it spreads to every geographical corner of the country.
  In recent months we have heard a great deal about the industrial relations climate in the NHS, and we have heard a great deal about it from the Opposition Benches this afternoon. A lot of evidence has been produced to support particular theories of industrial relations. Most of the evidence that has been adduced by the Opposition has been anecdotal. The only way in which people can judge the state of industrial relations in the NHS is by looking at the overall statistics. They are the most reliable measure.
  Department of Employment figures for 1976 show that the amount of time lost through industrial action in the NHS was less than the equivalent of 10 minutes for each member of staff over the whole year. As far as I am concerned, that is 10 minutes too much, but nevertheless that puts into perspective the tale of doom and woe that we have heard from Opposition Members today. In addition, the NHS has a long tradition of Whitley-ism, that is, negotiation through established machinery and joint resolution of its general problems by a process of negotiation and discussion between employers and unions.
  The figures also show that there was a change in the type of industrial relations disruption that we have been experiencing in recent years, and this is important for what I want to say later. In 1972, 1973, 1974 and 1975 a large number of NHS staff were involved in national action, stoppages and disruption over pay and related matters—general terms and conditions of service. In recent years there have tended to be more stoppages involving fewer staff.
  That was the interesting point made by my hon. Friend the Member for
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  Lewisham, West (Mr. Price) in his brief intervention when he drew attention to the fact that many of the disputes that have hit the newspaper headlines recently have involved specific local issues—very often issues which have probably been unwisely pursued—directly related to what employees of the NHS have thought was a better way of providing health care than the way they were being asked to follow. This suggests that recent industrial action has resulted from specific local action issues where the scope for remedial action is at local rather than national level, and this is important.
  Mr. Hodgson: Will the Minister give way?
  Mr. Moyle: No.
  That has to govern the nature of the solution of the problems; and I shall return to this matter of the localisation of issues when I talk about our hopes for improvement. After all, the right hon. Member for Wanstead and Woodford (Mr. Jenkin) asked what the Government intended to do about this matter. I share my right hon. Friend's concern about the effect on patients of stoppages by all types of staff in the employment of the NHS. My right hon. Friend has over and over again emphasised his disquiet about the results of such actions, and I do not wish in any way to detract from anything that he has said.
  We deprecate industrial action in the National Health Service which might endanger the care and safety of patients. My hon. Friend the Member for Ealing, North (Mr. Molloy) asked for statistics of how many patients might have been killed or died as a result of industrial action. I know of no case where that has happened, although I confess that there have been times when a great deal of worry has been caused.
  We recognise the right of any National Health Service employee—and, indeed, of any employee anywhere else—to be able to air his legitimate grievances, and in an organisation of the complexity and size of the NHS the desire to do so is bound to occur from time to time. It is true that grievances and complaints have not always been dealt with as effectively as they might have been in the past. On going round the NHS I have been very disturbed to see in many cases either the breakdown or the total absence of

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  arrangements for joint consultation between management and staff at local level. There are, of course, many exceptions. In some localities the arrangements are working remarkably well, but there has been a tendency for all negotiations to be centralised at national level, and there has been a tendency on the part of some managements at local level, either through inadvertence or through general resistance to modern trends, to carry out the sort of joint consultation that there ought to be.
  I have no doubt that when it comes to the resulting industrial unrest many employees in the NHS, as the right hon. Member for Wanstead and Woodford said, are dedicated people who share the general apprehension about the damage being done to patients. In fact, that is true of the overwhelming majority of employees in the NHS. If one takes a historical look at the NHS, one cannot deduce from the rates of pay prevalent in the service that the unions have exploited their undoubted power to look after themselves and not look after patients. I believe that the leadership of the affiliated TUC unions and many other professional bodies and associations in the NHS is ready to say that sort of thing.
  Mr. Onslow: If one looks at the history of the NHS, one would not say that it was marked by the fact that prospective patients were denied admission to hospital because of action by the unions. This is a new and disturbing development. Can the Minister tell me specifically why his answer to my Question the other day was so inaccurate?
  Mr. Moyle: If we are talking about the answer to the hon. Gentleman's Question, we have to get it into perspective. The hon. Gentleman quoted about three dozen hospitals where admissions are restricted. That is three dozen too many, but it is 36 out of 2,600. That is why I say that most of the evidence which the Opposition has adduced this afternoon has been entirely anecdotal and local, and it is this local issue which is the most important matter that we have to discuss.
  Mr. Onslow: On a point of order, Mr. Deputy Speaker. The Minister is in grave danger of misleading the House.
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  I quoted nothing. The statistics came from the Minister. I want to know why the answer that I received was so misleading. I am sure that the Minister does not wish to mislead the House and if he is thought to have done so I hope he will explain why the answer took the form that it did.
  Mr. Deputy Speaker (Sir Myer Galpem): As the hon. Gentleman says, the Minister may mislead the House. He has not misled it so far.
  Mr. Moyle: I have said that I think that most of the TUC affiliated unions and many of the professional associations in the Health Service are willing to say that they will work on the principle that patients' interests come first. It is very important that in return—this was the point made by the hon. Member for Canterbury (Mr. Crouch)—the employees in the Health Service must be sure that their willingness to devote themselves to their patients will not be used against them.
  The change of atmosphere in the Health Service possibly occurred during the ancillary workers' strike in about 1972–73, when ancillary workers, rightly or wrongly, came to the conclusion that their unwillingness to harm their patients was being used against them by the Government of that time to break an industrial claim which would have breached that Government's pay policy. I think that it was then that the worm entered the bud of the NHS. That is a valuable lesson that we should all take on board.
  We must not exploit the willingness of NHS workers to dedicate themselves to the care of their patients. This lesson will guide my right hon. Friend and myself in the time to come.
  Mr. Patrick Jenkin: I said in my speech that the right hon. Gentleman was a member of NUPE, and I believe a NUPE-sponsored Member. I quoted the interview with Alan Fisher in which he said that the patients were not the unions' first consideration, that their first consideration was the pay and conditions of staff. Is the right hon. Gentleman now saying that he will try to persuade the leaders of the unions that that is not the right attitude, and that patients must be their first consideration?
  Mr. Moyle: We have been engaged in an exercise of that sort for some weeks. It is by no means a new departure. If the right hon. Gentleman will possess himself in patience for just a little while, I shall explain what we shall do in this matter.
  When industrial action has taken place, health authorities have so far succeeded in maintaining essential services to patients. I am confident that they will continue to do so in such conditions, but what is needed now is a move towards dealing with these problems before they reach a stage at which patients will be affected.
  It is not only the Government and employing health authorities that are concerned to improve matters. I find that the health professions and the trade unions, without exception, are equally anxious to find the solutions.
  First, as the House knows, my right hon. Friend has been engaged in discussions with representatives of the main NHS professions and unions, discussions which are aimed at improving the industrial relations climate and in particular at safeguarding patients. I think that within the next day or two those discussions will come to fruition. It will not be as complete fruition as I should have liked—I grant Opposition Members that —but a substantial measure of agreement will be reached with most organisations.
  Clearly, I cannot say what is in the document that is to be issued before it is issued. There is no doubt that trade unions are concerned to make sure that the good will of employees in the NHS is not exploited and to ensure that proper resources are provided for the NHS. I know that they are also anxious to ensure that the idea that patients should be given first priority is seen to be important, a matter which should receive particular attention this week, when we are all not only looking at the past 30 years of the NHS but are looking forward to the next 30 years.
  Mr. Pavitt: Has my right hon. Friend set a term for the time in which the document to which he has referred will be discussed by the other side of the Whitley Council? Is there a set date?
  Mr. Moyle: No set date has yet been decided on, but these matters will be considered by the Whitley Council.
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  Many of our recent problems have had local causes, requiring local solutions. The general declaration of principles for the future of the NHS will be followed up. In many cases industrial action might have been avoided if there had been adequate local machinery for dealing with points at issue quickly, before they reached a disruptive stage.
  I apologise for not having been present when my hon. Friend the Member for Brent, South (Mr. Pavitt) was making that pertinent point. There is nothing more frustrating than for someone to feel that he has a genuine grievance but no way of getting a fair hearing in a reasonable time. Delay of itself can lead to industrial action.
  Whereas on matters of pay and terms and conditions of service there is a national Whitley machinery, which by and large for most of the time the NHS has been in existence has provided a solution to those problems, many matters lie outside the Whitley machinery. If a local appeals machinery and local disputes procedure could be implemented, they would lead to a ready solution of such problems. Although I do not want to comment in any detail on the problem, I think that the dispute at the West London Hospital is a typical example of what I have in mind.
  When we came to power and took over the NHS in 1974, we took stock of the situation. We came to the conclusion that there were great gaps, particularly in local consultation and in some ways in which the employers' side of the Whitley Council was constructed. Therefore, we asked Lord McCarthy, who is one of the leading industrial relations experts in the country, to look into the whole machinery of negotiation and consultation in the NHS.
  We have already reformed the management sides of the Whitley machinery to make sure that they are more responsive. We are quite clear that these reforms have a vital role to play.
  We shall carry on a continuing dialogue on such matters with the staff side of the Whitley Council. Discussions are also in train under this general approach on the improvement of joint consultative machinery and on procedures and appeals in relation to disciplinary action and redundancy and retirement procedures.

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  What about the longer term in the NHS? We have been actively encouraging the development of the personnel function in the NHS. Since reorganisation—and this is a benefit of reorganisation—personnel officers have for the first time been appointed in the Health Service. We are making sure that they gain the appropriate experience and the appropriate training. They are undergoing a series of intensive industrial relations courses mounted to make sure that their contribution is even more effective.
  We are taking steps at the same time to improve our arrangements for monitoring the industrial relations climate in the NHS in order that we may identify trends which suggest scope for remedial action at an early stage.
  At all levels, locally and centrally, there is still a great deal of work to be done in the NHS. I believe that we are in the process of making slow, steady, significant improvements. I hope that this week's activities will ensure that all those in the NHS will rededicate themselves to the idea that the patients' interests are the paramount concern in the Health Service, and that we shall all act on that basis.
  Of course, this is a two-way business between management and unions. It is therefore very distressing that Conservative Members can speak as some of them have spoken today. For example, I took down the words of the hon. Member for Birmingham, Edgbaston (Mrs. Knight) who said "When unions ask for bashing, it is a cowardly politician who does not bash them." That statement was made with great relish and enthusiasm. Whereas the right hon. Member for Wanstead and Woodford and his hon. Friend the Member for Reading, South I think mounted the debate with the idea that we might have a philosophical discussion about the future of industrial relations in the NHS, contributions such as the hon. Lady's are of no help. I notice that she adheres to what she said.
  Mrs. Knight: The hon. Gentleman should read what I said.
  Mr. Moyle: I took down what the hon. lady said word for word as she uttered those words. I do not think that I have misquoted her. It was the sort of contribution that too many on the trade union
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  side of industrial relations feel is typical of the attitude of Conservative Members. That attitude will contribute more towards worsening industrial relations in the NHS than almost any other contribution I could think of.
  Against this background, it is important to go through the points made by the hon. Member for Reading, South. He called for professional groups to be allowed to negotiate practically daily on their terms and conditions of service with the NHS management. Nurses are involved in daily negotiations. They have seats on the Whitley Council.
  Dr. Vaughan: Will the right hon. Gentleman ensure that nurses are not turned out of the negotiating room?
  Mr. Moyle: Of course I will. There is no problem with this. Nurses are on the Whitley Council as of right. There is no attempt to ask the nurses to leave. I cannot understand how remarks of that sort can be made by the hon. Gentleman, who is supposed to be an Opposition spokesman on this subject.
  Mr. Patrick Jenkin: Does not the Minister know that in hospital after hospital across the country there are joint consultative committees where TUC affiliated unions are refusing to sit down with representatives of organisations not so affiliated? Does the Minister support that or is he now prepared to use his influence to tell these TUC affiliated unions that they must sit down with all the organisations and negotiate jointly?
  Mr. Moyle: The right hon. Gentleman's intervention serves to show the degree of ignorance, which he shares with the whole of his party, on the subject of industrial relations. I have been talking about joint negotiations and the comments made on them by the hon. Member for Reading, South. With joint negotiation, there is no doubt that nurses are on the Whitley Council as of right and negotiate on behalf of those they represent. The right hon. Member for Wanstead and Woodford is talking about joint consultation, which is an entirely different, local, matter. If the right hon. Gentleman and his hon. Friend cannot distinguish between joint consultation and joint negotiation in industrial relations, they are losing a great deal of ground. They are not grasping the problems.

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  When it comes to joint consultation, the management of the Health Service will talk to any representative body to discover the views of that body and incorporate them into its policy. The intervention by the right hon. Gentleman and the hon. Member shows their degree of misunderstanding of the industrial relations set-up in the Health Service. I hope that they will soon inform themselves about the correct position.
  The hon. Member for Reading, South asked me to condemn strike action. I have supported the Secretary of State in all his statements in that respect. The hon. Gentleman called for a code of behaviour. I hope that this week substantial steps will be taken in that direction. As for allowing professional staff to get on with their job, I have already said that the most substantial obstacle to this is the organisation of the Health Service and I do not propose to rehearse what I have already said on that subject.
  I welcome the opportunity which the debate has provided to air this subject because industrial relations is an important topic. I say to my hon. Friend the Member for Fife, Central (Mr. Hamilton) that my right hon. Friend the Secretary of State fights a passionate battle within the Cabinet for extra resources. Even during the darkest days he maintained a rate of real growth in the service. It was exempted from the International Monetary Fund cuts for the purposes of revenue expenditure. In September 1976 capital and revenue were increased. Capital was provided for the construction industry. In this Budget we got an extra £50 million. I am sure that my right hon. Friend will carry on fighting with effectiveness, if not necessarily always with venom.
  Mr. James Tinn: I beg to ask leave to withdraw the motion.
  Motion, by leave, withdrawn.

NORTHERN IRELAND (RURAL PLANNING)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Tinn.]
7.4 p.m.
Mr. J. Enoch Powell: My hon. Friends and I are grateful to the official Opposition for having made available to us the second half of this Supply Day. We are the more grateful because we know how extremely anxious they are to find time for discussing other subjects upon Supply, such as the question of New Commonwealth immigration and its consequences, which I know they have been trying for a long time, unsuccessfully, to fit in. We are the more in their debt on that account.
We have decided to use this opportunity for discussing the impact upon the pattern of rural society in Northern Ireland—that is, upon the predominant form of society in Northern Ireland—of a system of planning regulation. There is certainly no part of the United Kingdom where this subject is of more importance, not merely in its day-to-day-impact upon individuals and families but in its consequences for the future economy and the future society of the Province as a whole. The occasion is the more opportune because of the recent publication of a remarkable report, the report of the committee which was chaired by Dr. Cockcroft. This report, like so many documents tendered to or emanating from the government of Northern Ireland, has very properly been made available for general public study and comment. The latest date for the receipt of such comment is as far ahead as 30th September.
We do not feel that that is any reason why we should not debate this subject tonight on the Floor of the House. Quite apart from the fact that the House will be going up, presumably at the end of the month, and there will then be a long period during which this consultation period will come to an end when the House will not be sitting, this is not the kind of subject where one needs to wait breathlessly for the full total of comments to flow in before hon. Members are entitled to stress the important aspects and put forward their views.

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We certainly do not regard a planning policy as something which is subject to sudden and dramatic jerks and developments. We want to see a smooth development, although a development, as I shall show, very different in its tendencies and in its spirit from that which has characterised most of the last five years. We feel no inhibition whatever in opening up this subject and putting forward our views upon it.
Anyone who as an observer—I might even say as a lover—of the English countryside goes to Ulster, either as a visitor or more permanently, is bound to be struck by the contrast between the two patterns, the English pattern and the Ulster pattern. Instead of the sharply demarcated village system characteristic of England and the wide areas almost without human habitation—not merely in the wilder parts but in the rural and arable areas—the visitor to Northern Ireland is rarely out of sight of human habitation. In the fastnesses of the Mourne Mountains in my constituency he has to chose his position carefully if he is to look through 360 degrees and find his eyes not met by at least one habitation. This characteristic is deeply embedded in the economic and social history of the North-East of the island of Ireland and it has not only placed its mark upon the people; it endows them with certain advantages which are not enjoyed by the inhabitants of other parts of the United Kingdom. They are particular advantages which we do not wish to see diminished or destroyed by an unwise or an insensitive application of planning legislation.
In the rest of the kingdom, particularly in England, industrialisation has meant the denuding of the country, and it has often meant or threatened the death of the rural, the village, community. The lifestyle has been totally altered in the rest of the kingdom by the process of industrialisation. One may say that that goes as much for the new industrial revolution as for the old. No such threat need be posed to Northern Ireland by the industrial development and the economic advance to which we look forward.
It is true that, as the years go by, a lower proportion of the total population will necessarily be engaged in agriculture. That is the counterpart of the increasing
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efficiency, in which Ulster has not been behind hand compared with the rest of the country. But whereas elsewhere the decline of employment in agriculture tends to mean the denuding and impoverishment of the country, that is not so, or it need not be so, in Northern Ireland.
In Northern Ireland, both industry can come to the country and the country dweller can go to industry. I would like to look for a moment at these two sides of the equation. They were both referred to in the evidence given to the Cockcroft committee on behalf of the Department of Agriculture, which said:
"The development of industry in the district towns and, to a lesser extent, in the villages could assist in the improvement of farm structure by providing alternative employment opportunities to small farmers and their families, many of whom will wish to remain domiciled in the countryside."
So, on the one side, there is virtually no part of Northern Ireland to which suitable industry is inappropriate, and that siting of industry—and not only or not exclusively rural and ancillary industry—widespread over the Province means that farming families and the farming community's particular patterns of life and habitation need not be broken up by the shift from agriculture to non-agricultural, industrial or service employment.
On the other hand, so small is the Province in size—and I must say so excellent, certainly compared with much of England and Wales, are the communications—that in most parts it is perfectly practicable for the younger generation, or one part of a family, while living in or near the family home, the farmstead around which the family has centred for generations, to travel daily to a place of work in the industrial centres of the Province. I take a statement from the report to that effect:
"…the preference of rural dwellers to preserve their rural community connections and identity even though they may choose to work in urban centres thus preventing an ageing and rapidly dwindling rural population."
So the unique pattern of settlement—I have sometimes been so injudicious as to describe it as the pepperpot method of settlement—of Northern Ireland, which so strikingly confronts the observer, is a potential source of strength, elasticity and resilience to the economy and the society of Northern Ireland, and it is that which we wish to see not merely uninjured but

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preserved and built up by a proper application of planning policy.
We could not be better guided in that direction than by the report of the Cockcroft committee, which really is an exceptionally excellent document, forthright in its statements, refreshingly literary in its language, and a document which certainly pulls no punches and owes no respect to any vested interests or current theories. We congratulate the Under-Secretary of State on setting it up only just a year ago, and his action in doing so, I noticed, was acknowledged by the committee itself in conferring upon him a Privy Councillorship. We congratulate the committee even more upon the work that it has brought out.
So good is this report that one has to fight hard against the temptation to over-quote. There is hardly a paragraph in it which does not contain at least one really good quote, but I shall endeavour to ration myself to some of the key statements of the Cockcroft committee.
I begin with the indictment in the report of the existing failings of planning policy, although perhaps I should say at this stage that in nothing I shall say, and in nothing, I think, that my hon. Friends will say, do we imply that during the last four or five years there has been no change or development. On the contrary, I know that the Minister himself has taken a personal interest in introducing more flexibility into the planning rules-of-thumb which were being applied, and I have reason to be grateful to him personally for the attention he has given to individual cases from my constituency which exemplified only too harshly the consequences of rigid rules of planning imported from an English context and applied in Northern Ireland.
The Cockcroft committee said:
"We are satisfied from the evidence presented that there is a reluctance on the part of the policy makers to accept anything other than the strictest proof of necessity to live in the countryside as good reason for obtaining planning permission."
Do we not know it? Do we not, from our constituents, know perfectly well the hoops they are made to jump through in order to establish the basic, prima facie right to live in the countryside. The report continues:
"This intransigence ignores the social structures and settlement patterns peculiar to
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Northern Ireland, where there is a centuries-old rural tradition of living in a scattered pattern of loosely grouped and isolated dwellings which, nevertheless, form identifiable communities based on parishes and townlands and woven together by kinship groupings. By the same token, systems of land tenure have not been taken into account."
I think that the word "intransigence" which the committee uses there is a singularly apt term with which to describe the rigidities of a good deal of planning policy hitherto.
I turn to another statement, in paragraph 26, which says:
"We must record that evidence presented to us has overwhelmingly indicated that the policy is forcing the disintegration of rural communities with the consequent loss of social stability and declining use of earlier investment in churches, schools, halls, roads, water and other services; in short, the result of the rigid application of the rural planning policy is seen a; a depopulated countryside scattered with abandoned buildings and derelict dwellings."
That could hardly be put more forcibly or, indeed, more accurately.
My last heading from the indictment as framed by the report is from paragraph 37. I quote only one sentence, for it is a subject to which I intend to return.
"The Committee does not accept that the rural planning policy is administered in a sympathetic and understanding manner."
I dare say that my hon. Friends, like myself, when they read that sentence, murmured "You can say that again".
Within the compass of this limited debate, I can only pick out what seemed to me to be some of the major proposals for the adaptation of planning policy to the rural pattern as it is in Northern Ireland. I pick them out from the report not to indicate that by any means these are the only important recommendations but to indicate that they are among those with which hon. Members dealing with their constituents, and watching the development in their own areas, have become distressingly familiar.
The first is the "infilling" rule. That is a term of art which is not unfamiliar in other parts of the United Kingdom—that one can build a house in a rural area provided that one can satisfy the planning authority that it is infilling. But "infilling" is defined in the present policy note as:
"a small gap in a substantial and closely built-up frontage allowing at most for two dwellings".

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We associate ourselves with the comment of the committee upon that, which was:
"We find it difficult to comprehend the rationale behind the definition and we consider that it should be relaxed".
In the length and breadth of Northern Ireland everyone can find areas where evidently, without any damage to the pattern of the area or to any consideration of agriculture or amenity, a great deal more than space for two dwellings in a closely built-up frontage represents in the normal and natural sense of the term "infilling". Therefore, the first point we would make is that the whole concept of infilling in planning policy has to be thought through again against the background of the actual rural pattern in Northern Ireland.
Then there is the use of old sites. Again, I quote from the report on this subject. In the passage which I quoted earlier, which drew attention to the depopulation and the scatter of derelict, decaying buildings, which could result from a mistaken planning policy, the committee continues:
"Such buildings are already increasing in number yet their siting is generally admirable, rarely on skylines, usually sheltered and surrounded by mature trees and hedges, and with access along hedge lines. We recognise that in some instances there may be sound reasons against replacing dwellings on existing sites, but it has been strongly put to us that the… restrictions"
—as at present applied—
"are not acceptable".
I doubt whether more than a week or two goes past before I am confronted in South Down with the proposition that the permission to develop a new dwelling on an old site has for one reason or another been turned down. Indeed, the Minister has before him a particular case which is at present in my mind's eye. It is a site below the brow of a hill on a descending slope. It is surrounded, as the committee says, by mature trees. There are two old buildings on the site which could be worked into a new pattern, and there is a perfectly safe and suitable access to the adjacent road which could be contrived, avoiding all possibility of road danger. One could not imagine a more suitable site, not for new development but for redevelopment.
That one of the sons of the farmer higher up the hill should wish to build
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for himself a house on that site is surely devoutly to be desired. His application had been turned down out of hand. But I have good hope that with the flexibility of mind which the Minister personally has often shown, that decision will not be upheld. I quote that case as an illustration of the way in which one of the great assets of the Northern Ireland countryside is being deliberately neglected.
The existing sites of former settlements or dwellings which are ideal from every possible point of view for renewed occupation, and very often renewed occupation by those who are related to the people who work the soil in the neighbourhood, are something on which we should like to see a change of emphasis. Indeed, we should like to see the onus shifted the opposite way. The onus should be on the planning authority to explain why a former site is not now suitable for a dwelling house.
Then there is the attitude towards industries in the countryside. No serious thought seems to have been given to industrial planning in the countryside as opposed to planning for residence. The committee has certainly made an important point in saying that this has to be considered in its own right. In the words of the report, we believe that
"The need to foster agriculturally related industry in the countryside has been disregarded."
Those are strong words to find used of a planning authority in a predominantly rural province such as Northern Ireland, but they are not a whit short of the truth. The presumption ought to be in favour of the would-be developer of an agriculturally oriented industry in the deep rural parts of Northern Ireland. Everyone comes across the small factory, very often closely knit with the agriculture of the neighbourhood, which is both socially and developmentally an asset to the neighbourhood. But, on the whole, the attitude has been the rule-of-thumb—"Industrial development? Put it in the urban areas. Put it in the areas which are zoned for industry". This concept of zoning, which in England we have grown up with over two generations, is really not applicable, or at least not applicable until it is transformed out of recognition to the circumstances of Northern Ireland

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I turn to the point about the over-rigidity in insisting upon avoiding waste in the supply of services. On that subject, the committee is again excellent. Of course, we all know the argument. It is essentially an English argument. "Put the houses where the services can be cheaply provided". That is one of the guiding lights of rule-of-thumb planning policy on this side of the water, but hear what the committee has to say:
"The argument for economy does not take into account the existence of a widespread service infrastructure in rural areas, and an investigation is clearly required into the comparison of direct costs in the provision and maintenance of services in dispersed rural communities with the level of public finance needed to create additional urban housing."
After that, the committee achieves a statement for which I have waited for donkeys' years. It says, "but after all we do not need to assume the full range in urban terms of services in order to be justified in permitting development"—and here comes the sentence:
"the owner-occupier's…freedom of choice to live without full social facilities should he so wish".
Hurrah, hurrah! We have been waiting for someone to say that; for after all, the man who was prepared to build himself a house, and choose for his reasons where he wanted to live, was entitled to accept that in that area some amenities indeed might not be available, but he had made his choice and knew what he was doing. It is unrealistic in the circumstances of Northern Ireland to work upon the calculus from the cost of services which is perfectly applicable to urban developments in England.
Noticeability is the next point. This is what is said about noticeability:
"the 'noticeability' of a house is irrelevant; that it is necessary and enhances the environment is most pertinent."
The planning authority under planning rules that prevail at the moment—unless one can personally secure some attention to the realities on the ground—go by the rule-of-thumb that if a house will stick out, one cannot build it. Of course I agree that there are many circumstances in which it is far better to site a house below the skyline rather than on the skyline, but the traveller through Northern Ireland finds many houses that are extremely prominent and do stand out against the countryside, but these are
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necessary and they enhance the environment. There are many houses, deliberately painted in that typically Ulster shade of ochre, which stand out for miles, yet no one would say that these houses were a desecration of the hillside or the country in which they sit. They belong to it, are part of it and give it its character.
That is not true just of the older houses, the Georgian houses, the houses with the Dublin front doors. It is equally true of many of the well-designed houses which have been built in recent years and which are still being built. Therefore, let us get rid of the rule-of-thumb that if it is noticeable one cannot do it. That is not the rule by which to control developments in the Ulster countryside.
I have already said something about rural and agricultural industries and their place in the country pattern. I hope that the Minister will see that particular attention is given to the chapter on industrial and commercial developments, and particularly to the suggestion again to dispense with the rule-of-thumb that were there are fewer than 10 employees one does not bother about them, that the Department of Commerce should be brought into the picture and into the consultations only when a planned industrial development will give employment for at least 10 people. The report says that if a development will give employment for one extra person it is worth consideration in its own right. I hope that that is one of the many recommendations of this committee that will be adopted.
I come to the last of the list of recommendations that I have selected. It concerns buildings dedicated to tourism. I was particularly delighted when I read paragraph 60 of the report on that subject. I had been explaining to the Standing Committee on the Finance Bill that in Northern Ireland the definition of the size of the number of bedrooms of a building appropriate and required for the development of tourism was often very much smaller and the site very different from that which would be expected in other parts of the United Kingdom.
The Northern Ireland Tourist Board stressed to the committee
"that since it is a statutory body with specialist expertise it should, as of right, be consulted by the planners about any potential tourist project

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or any development that could adversely affect the tourist industry".
The Tourist Board has been particularly keen that the provision of new accommodation, even in small units, in the deep rural areas of Northern Ireland should not be hampered, because it fits the pattern both of the country and the wishes of those who enjoy that kind of country.
I shall not lengthen the very selective list of points to be noted—points that I hope will be accepted and implemented in due course—that I have culled from the report.
I turn finally to administration. I have already quoted the damning sentence from the committee on administration:
"The committee does not accept that rural planning policy is administered in a sympathetic and understanding manner."
The report goes on with very wise words:
"the advent of bureaucracy has alienated many of those involved in, or affected by, planning decisions. It is our view that this sense of alienation must he removed."
That will come as no surprise to Northern Ireland Members. It is our view that the sense of alienation should be removed. We believe that in this we shall have the sympathy of the Secretary of State himself and the Northern Ireland Office generally.
In the end there is only one way to remove alienation which is caused by bureaucracy. That is by subordinating the bureaucracy to those who are democratically elected and responsible. I deliberately say "and responsible". Merely to take an elected person and put him on a board is not democracy. He may be an elected person in another context but he is not elected when he is put on the board. He is an appointee, just as much as anybody else. True, he may be in touch with what his colleagues on his elected body are thinking, but when he is on the board he is not there as a responsible representative. He does not have to go back individually to those who sent him there and explain what he has done.
This is where there is scope for utilising and developing local government in Northern Ireland. This should appeal to the Secretary of State, who told the House last Friday that he would see whether the right principles are being properly applied in the allocation of functions and
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responsibilities between the district councils and the regional government.
Planning is one area in which they are not properly applied. It is an area in which the bureaucracy has too much and the district councils too little. Indeed, that is an exaggeration, because the bureaucracy has it all. The district councils are in a purely consultative, non-responsible and non-representative role.
Rev. Ian Paisley: They are just informed.
Mr. Powell: Yes, they are just informed. That is another and very common meaning of the word "consultation".
That brings me to perhaps my only serious disagreement with the report. The report says that
"there should be a statutory requirement for the Department to recognise that councillors should have more than a consultative role".
We would agree with that. Indeed, we would say that in the detailed local application of planning policy the councils should be given a responsible, executive role. After all, there is plenty of safeguard. There is an appeal procedure. If the Minister does not like it, he can provide himself with an appeal procedure if he wishes to do so. But the executive power of detailed application—if we are to get away from bureaucracy and undo the alienation—must belong to the councils themselves.
Therefore we disagree with the proposal in the report to give the councils an appeal function. I do not believe that it is the natural function of elected bodies to sit upon appeals. Their natural function is to do. If there is to be an appeal, then we wish to take it a little further away and give it to a different sort of body. The elected body should be doing the initial deciding.
In this one respect the committee was misled. It says in paragraph 4:
"Councillors did not express to us any desire to assume the planning responsibilities of their predecessors prior to 1973, since planning decisions often led to divisions, dissension and allegations of sectarianism."
I would be the first to agree that the district councils can only play a subordinate function in planning, in the sense that the general pattern of planning and the overall rules must be decided on a scale for the Province as a whole. But

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I do not know where the Committee went if it found councils that did not think they were fit to deal with the detailed application of planning policy in their own areas. As for
"divisions, dissension and allegations of sectarianism",
what are elective councils for but to debate and decide matters which may be the subject of controversy? If they take a decision which in the view of the Secretary of State is contrary to general policy or a decision regarded as oppressive by the subject, he has his recourse by way of appeal.
I hope that this report, and in its way this debate, will not only bring about much more rapid process in the adaptation of planning to what Northern Ireland is and should remain in the future but will help in the task which I know the Secretary of State has set himself—namely, the re-democratisation of government in Northern Ireland. I refer to the bringing back of government to the understanding, control, sympathy and support of the people themselves.
7.42 p.m.
The Under-Secretary of State for Northern Ireland (Mr. Ray Carter): I wish to welcome to the Opposition Front Bench the hon. Member for Petersfield (Mr. Mates). I understand that it is his maiden appearance at the Dispatch Box. He comes to this debate with considerable knowledge and experience of affairs in Northern Ireland. Therefore, he is no stranger to us.
I do not propose to make a long speech, and I shall certainly not make a controversial speech. The Cockcroft report is now before the people of Northern Ireland and is being considered by local authorities and political parties. Therefore, in this debate I wish to say nothing that will in any way prejudice the outcome of discussions. Although the report has been published, I am sure that many people think that there are still further contributions to be made. Indeed, this debate illustrates that hon. Members have points to make, as I am sure we shall soon discover in this debate.
I do not think that we can have too much discussion of the subject of rural planning in Northern Ireland. It is a controversial subject and since I have
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visited 26 councils in Northern Ireland I can only say that, if one leaves Belfast out of the picture, the other 25 have a very great deal to say about rural planning.
I hope to have the opportunity at the end of the debate to reply to any points made about broad policy and to make a few comments of a philosophical nature. I have some general thoughts to give the House on the subject of planning. It is an area of activity in which I have been involved for many years. My hon. Friend the Member for Brigg and Scunthorpe (Mr. Ellis) has a great deal in common with me. My first appointment in the world of representative politics and government was on the East Hampstead rural district council, and my hon. Friend and I served together on a planning committee, which often sat until three or four o'clock in the morning in that small council in Berkshire. Therefore, I was well aware long before I went to the Northern Ireland Office that planning was an important subject for those who live in rural areas.
I am grateful to the right hon. Member for Down, South (Mr. Powell) for raising the subject of rural planning in a helpful and constructive manner. He has mentioned the recently published report of the committee which I set up last May to examine and make recommendations on our present policies for the control and development of the countryside. I should like to take this opportunity to thank Dr. Cockcroft, the chairman, and his committee for producing within 12 months this comprehensive and useful report on a most difficult and sensitive subject.
The committee has made a number of detailed recommendations, which seem to fall into two main categories. The first group of recommendations refers to our policies on domestic housing and development in rural areas, and he and the committee urge the Department of Environment, the sole planning authority, to adopt a more flexible and sympathetic approach. The second group of recommendations refers to our policy on industrial and agricultural development, though once again the keynote is the need for flexibility.
I shall be giving all these recommendations careful consideration and, obviously, my officials will need time to study the

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full implications of the recommendations. Moreover, as my right hon. Friend the Secretary of State said to the House last Friday, we must remain sensitive to the views and feelings of local people. Hence, I shall be inviting comments on this report from elected representatives such as hon. Members here this evening and from district councils, as well as from other interested organisations such as the Ulster Countryside Committee and the Royal Society of Ulster Architects and any other interested parties.
I have no doubt that hon. Members will be referring to these recommendations during the course of this evening's discussion, and I think it would help if I reminded the House of the basic aims of our rural planning policies to which these recommendations refer. Our rural planning policy is, of course, only one element, albeit an important one, in the whole physical planning strategy. The regional physical development strategy for Northern Ireland sets out clearly the Government's overall planning policies and objectives. It is a strategy designed to maximise economic growth, whilst taking into account social and environmental factors, and to ensure that all the people in Northern Ireland benefit from this industrial growth. We have decided that this aim can best be achieved by the regeneration of Belfast and the adoption of the district towns concept. Outside Belfast, the concentration of scarce investment and resources in district towns will make them more attractive to new industry and create improved social and environmental conditions.
However, I recognise that some growth will be necessary outside the district towns in the smaller county towns and villages. I accept that many people who have lived all their lives in rural areas are simply not prepared to move into a district town, whereas they may be prepared to move into smaller settlements which are still essentially rural in character. The regional strategy provides for this and stresses that services need to be maintained and provision made for some expansion to cater for the increased population in these small towns and villages. These are being identified by my Department as it continues with the preparation of area plans. Obviously, development of these settlements must depend
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to a large extent on the employment opportunities available in the surrounding area and those nearest to the district towns are more favourably placed in this respect.
However, as Dr. Cockcroft's report has highlighted, it is the development outside these settlements which is causing the most controversy. Our aim is to complement the other aspects of the overall regional strategy, while recognising that individuals must have as much choice as possible about where they wish to live. We fully recognise that some people must live in the countryside outside any settlement. However, any applications for rural development must meet certain defined criteria as regards the amenity of the countryside, the loss of high quality agricultural land, ribbon development and urban sprawl. Moreover, the cost of the provision of services, and factors such as pollution problems and traffic hazards are all important elements that must be taken into account.
I am sure that hon. Members here tonight will agree that these are important factors and they would not wish to see a total free-for-all, without any form of control in these areas. Northern Ireland's rural environment is too great an asset to risk squandering in this way.
Subject only to good siting and design and any other land use considerations, the policy recognises that planning permission must normally be given to persons who need to live in the countryside because of the nature of their employment. In addition, sympathetic consideration is given to applicants who, because of special personal or domestic circumstances, require to live in rural areas. Apart from these personal circumstances, the present policy also permits building on suitable infill sites and replacement of existing dwellings which are readily capable of occupation.
In my view, these policies achieve a balance between the legitimate needs of some people who live and work in the countryside and the need to retain and preserve the rural environment. The report of Dr. Cockcroft's committee criticises the application of these policies as being inflexible. Unfortunately, it is impossible to please everybody. In the carrying out of any planning policy, some people will be refused planning permission and, naturally, they will be aggrieved.

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If there were a particularly high number of people with grievances, I would accept that this would be a fair indication of inflexibility on our part. However, the latest figures show that roughly two-thirds of all applications for rural housing are approved and only one-third refused. These figures hardly indicate that the policies are being applied inflexibly. However, I would be the last person to argue that either our policies or their implementation are beyond criticism. It is for this reason that I have given the undertaking that we shall be studying the report carefully and entering into the widest possible consultations.
The Cockcroft committee has taken the first step in enabling me to undertake this comprehensive review, and I await with interest the comments of hon. Members tonight.
7.52 p.m.
Mr. William Craig: As I represent East Belfast, which has an electorate of about 100,000, most of whom are engaged in industry and commerce, with a large number manning and servicing the machinery of bureaucracy, some people may wonder what is my interest in rural planning. But this is a matter that every hon. Member should take seriously. I could cite a number of minor constituency interests such as the wellbeing of the Lagan Valley and the development on the shoreline of Belfast Lough, but there is a much greater community interest centred round rural planning.
The Cockroft report is a most useful start to what I hope will emerge as much new thinking on a vital subject. Planning is a dirty word to most people and it is a neck and neck race whether economic planners or physical planners are the more resented. I believe that this is largely due to the insensitive attempts to direct people in ways that they do not immediately see the benefit of following.
I start my consideration of the report where my right hon. Friend the Member for Down, South (Mr. Powell) left off—the glaring omission of any comment on the machinery for administering planning law. My right hon. Friend referred to the part of the report that said that district councillors did not want planning powers returned to them. That may or may not be their view, but that is not the
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point. The question is how we can best ad minister planning law.
Mr. James Molyneaux: Does my right hon. Friend agree that it is hardly surprising that members of the present district councils were not fully alive to the possibilities, bearing in mind that their predecessors, to whom mistaken reference is made in the report, were not the old rural councils but the county councils which dealt with planning?
Mr. Craig: That is a valid point, and I entirely accept what my hon. Friend says.
The essential machinery for the effective operation of any planning law must involve three levels. The first, which touches people most, is the area level—what happens in their own locality. The second—the central level—has overall responsibility for working out the strategy and co-ordinating the life of the community as a whole. The third level, which has been lacking not only in Northern Ireland, but in other parts of the United Kingdom, is an independent appeal body acting in a judicial role. Far too often decisions involve a great deal of injustice and there is no effective remedy for the citizen.
Of course, all this involves some basic criteria being agreed for planning law. I am not sure that the terms of reference of the committee were adequate if they are deemed to be limited by the statutory requirements of the Department or are only those set out in the report, which refers to:

"(a) the statutory requirements imposed upon the Department;

(b) the social and economic objectives embodied in the Regional Development Strategy;

(c) the need for due economy in the pi o-vision of essential services;

(d) the protection of good quality agricultural land;

(e) likely trends in population growth, population movement and employment; and

(f) the interests and wishes of those who live in the countryside;"

They are all relevant and essential to a study to produce a modern code of planning law, but the crucial omission is that there is no reference to the right of the individual and the right of property ownership. Those rights touch upon the fundamental character of a democracy

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and planning law impinges upon fundamental rights in terms of the individual and his ownership and use of property.
British law, and our concept of freedom, has always been jealous of these rights. Indeed, the Englishman used to boast that his home was his castle. I am not sure that Parliament has always guarded these interests with the zeal that one would expect. This is not only a British theme. It is an essential ingredient in the character of democracy throughout the free world.
The Government would do well to address their mind to the European Convention on Human Rights to which this nation subscribed. Article I of the first additional protocol to the convention states:
"Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law."
In other words, if one wishes to deprive an individual of his possessions or to limit his use of them, one must establish clearly and beyond doubt that one is doing so in the general interest, or as a necessary process of protecting the rights of others. That is why I lay emphasis upon the need for at least three tiers of administration to ensure that the planning law works effectively.
The area level, in my opinion, is the one that will create the necessary climate for people to co-operate and accept planning as a useful part of day-to-day living. What the body should be is not easy to say in the situation that prevails in Northern Ireland. One would certainly expect the district council to be considered for that role. Indeed, I wonder what is the purpose of the district council if it has no effective say in controlling and shaping the environment and growth of the area which it is responsible.
What sort of councillor would be happy if he had no say as to where public sector housing was to go, or what quantity or quality of public sector housing was to be thrust into the environment for which he was held accountable by the electorate? Equally, the councillor would wish to be able to say what sort of private sector activity he wants and what scale and quality it should be. The
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people who are paying rates to the district council expect that this should be so. After all, if one is to invest a substantial part of one's life and a substantial proportion of one's material goods in a place, one wants to be assured that one's investment will be protected, and that the activities of others will not throw away something that is crucially important to one as an individual. In all this, nothing can touch or improve upon an area body that is elected by the people who live in that area, whether it be a district council or something greater than a district council. An elected body is an essential ingredient.
The central authority is also crucially important and is also in trouble if it is not adequately answerable to the people, and to the electorate in particular. The central planning authority has the onerous task of working out a strategy, which should be nothing more than broad guidelines, but it also has the duty to ensure that either the public sector or the private sector, in taking decisions to invest, is investing in something which has a consistency about it.
I am not sure that I entirely agree with the Cockcroft committee in its assessment of central planning strategy, but one thing is certain—that unless the central planning authority can speak decisively for a long-term policy, planning cannot succeed.
The report makes one or two fairly basic errors, I think, in assessing the present situation in Northern Ireland. I do not believe that it is correct to say that the planning policy presently applicable is drawn from or equivalent to that operating in the highly urbanised areas of lowland Britain. I think that this is a misreading of what has happened in Northern Ireland.
Northern Ireland's strategy, in terms of modern planning, has grown out of a recognition that we were in danger of having the greatest proportion of the Province's population living in the capital city or the immediate environs. It is a problem very similar to that with which Denmark and Sweden had to contend. The attempted solution was not dissimilar to the policies that were adopted towards Copenhagen and Stockholm.
Unhappily, terrorism, which has existed in Northern Ireland now for all too long,

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has to some extent—indeed, to a very large extent—changed that picture. Belfast, as an industrial growth centre, no longer presents the same sort of problem as it did before terrorism broke out. But it would be wrong, in my opinion, to develop a strategy now on the basis that the terrorists will continue to succeed in what they have achieved over the ast 10 years. It is essential to Northern Ireland that Belfast should become once again a magnet of considerable pulling ower, and our rural planning strategy must take recognition of that.
In chapter 2, the conclusion of the committee, in paragraph 8, is:
"We do not believe that any overall planning policy for the Province should be a political issue".
I wonder what is meant by that remark. I can think of nothing more political than planning decisions of the sort that we are talking about, but presumably we are getting confused with the rather remarkable statement in paragraph 4 of the same chapter, in which reference is made to planning in an earlier age, alleging that it caused divisions, dissension and sectarianism. It is this sort of rubbish that seems to distort so much of our current thinking. Let us not allow these imagined problems to distort our thinking. We are dealing with something which is highly political, and which can best and only be handled in political institutions.
Chapter 4 touches with very considerable skill on the particular problems relating to Northern Ireland. I certainly agree that the Committee is speaking for the great majority of people in Northern Ireland when it says that there is a reluctance on the part of policy makers to accept anything other than the strictest proof of necessity to live in the countryside as good reason for planning permission. That is certainly my experience, and I have not found anyone in public life—or, indeed, professional life—who would seriously dispute that.
I welcome the approach of the committee to planning permission in rural areas, although I should like to see it even more flexible. I should certainly like to see a virile and vigorous approach to the encouragement of owner-occupiers. Compared with the rest of the United Kingdom, Northern Ireland is sadly deficient in the number of owner-occupiers in the
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community. This is of importance to the stability and progress of any community.
There is one thing that I cannot agree with, and my right hon. Friend the Member for Down, South has already referred to it, all too briefly. I for one would seriously question the right of the Department or the Northern Ireland Housing Executive to take steps to acquire land in settlements or villages for sale or leasing to individuals. This is not the way to encourage owner-occupiers. It merely enmeshes them further in the control of bureaucracy and inhibits the style and character of private development.
Paragraph 23 of the report refers to the physical development strategy. The situation is well stated. As we move through the document, we would do well to refer back to paragraph 23. But I should like to see more emphasis on the question of the destruction and revitalisation of culture. That is something which is entirely different from what we know today as conservation or the maintenance of historic buildings and buildings of architectural appeal.
In every community, and particularly in Northern Ireland, enshrined in bricks and mortar, on highways and byways, in main streets and back streets there is tradition and character which is being rubbed out too easily by development. Too often what is there is razed to the ground and replaced by something which is totally different in architectural style and layout. Often the revitalisation of a culture can be better achieved by encouragement and by granting permission to restore and improve that which is already there.
Not only in our large towns but in small villages there seems to be a planning dream that our main streets should not contain a proliferation of shops—that there should be one baker and one laundry to a street. But it is no part of the planner's job to arbitrate what services shall be available to the community. Competition is the spice of life. We want our villages and smaller complexes to have all the variety of the villages of yesterday but with the amenities of today and tomorrow.
The recommendation in the report that will be endorsed by everyone is that
"the present rural policy be operated in a more flexible and sympathetic manner".

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That is easy to say. I welcome that declaration. In particular, I welcome the recommendation
"That the special restrictions on the renovation, rebuilding and replacement of existing dwellings be removed."
That is a big step forward. If the right machinery is created with that type of objective, a major step will be taken for the benefit of our community.
I tend to disagree with the substance of paragraph 29. I do not believe that there is substantive evidence to question the value of urban and industrial concentration as a major factor in the resolution of the economic problems.
If Ulster is to have the economy that offers room for skills and energies, we must share in the development of modern technologies and we must be involved in large-scale industry. Skills and energy are not easily satisfied by taking in laundry or operating in small craft industries. The Northern Ireland of the future will depend upon its capacity to attract the most exciting of the industries that derive from modern technology.
Considerable skill is required in order to do that. We must bear in mind not only the skill of the urban facility and the services provided, but the skill of manpower. One of the things that has affected industrial development in Northern Ireland is the immobility of the labour force. I have known people to remain unemployed for long periods when a job is available in a town 15 to 20 miles away. This type of large-scale industrial development must be centred in a fairly large urban area if a labour force is to be found with any certainty.
It is important to relate rural planning to urban growth centres. Whatever the merits or demerits of the national policy, there must be a genuine and sincere effort to ensure urban concentrations in Northern Ireland without robbing or depopulating the rural areas.
I shall not go into the details of individual planning applications. I agree with my right hon. Friend the Member for Down, South and with the report that noticeability is not in itself decisive. There should be a general recognition that anyone should be able to build on his own land, unless there are good reasons for his not doing so. It is the responsibility
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of the planners to specify and declare what that good reason is. The individual must have the opportunity to challenge the planning authority.
I am a great believer in avoiding as far as possible uniformity in the lives of people. The greater the variety the better. That is the spice of life. I hope that the report has taken us a step along that way.
I take exception to few of the recommendations. That must be the hallmark of any good report. The recommendation to which I take the most exception is that which involves the acquisition of land by the Department or the Housing Executive. I agree with the rest of the report but I should have liked some issues to have been given greater emphasis.
Tourism is promoted and recognised but there is little reference to the recreational needs of the people. Recreation Is important in terms of planning. The best opportunities for recreation occur in the rural areas.
I have left the most controversial disagreement to the end of my speech. It involves recommendation 30 which reads:
"That, in order to raise the capital needed for the restoration of past, present and future development, some form of levy should be imposed on developers, supplemented by Government funds."
I can speak only for Northern Ireland, although I imagine that a lot could be said in United Kingdom terms on this question. The encouragement of development of any kind is not likely to be achieved if, as part of that encouragement, one holds out the spectre of further burdens of taxation. In Northern Ireland, I would much rather hear less talk about levies and taxes and do away with the concept of subsidies. It would be far better to relieve the citizens of taxes than to give him a subsidy.
In Northern Ireland, we have had some useful benefit from the subsidy given to the private sector of housing, but this benefit has been greatly overrated and exaggerated, and I should not be unhappy to see it disappear if it meant that we should be relieved of taxes on development. Of course, there are areas of activity to which some contribution has to be made. If the public purse is to create benefits from which the private citizens can derive advantage, there may be a case

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for some measure of tax, but I am reluctant to subscribe in general to a levy in relation to all forms of development, be it the restoration of the past, the maintenance of the present or provision for the future. Incentive and guidelines are what are needed.
This is a most useful report. I am glad that we have had an opportunity to discuss it, and I hope that this will not be the end of discussion in Parliament before decisions are taken.
8.21 p.m.
Mr. John Ellis: I make no apology for speaking in the debate, because I recently had an Adjournment debate on the decline of services in rural areas. I am always anxious to learn, so when I saw this document I wondered whether there was anything for me to learn from it, although its context is that of rural planning in Northern Ireland.
Having read some of the document, I feel that there is something missing from the debate thus far, and I hope to be able to make a contribution which hon. Members from Northern Ireland will accept as having some relevance. One of the terms of reference for the review was:
"(e) Likely trends in population growth, population movement and employment."
I am somewhat disappointed that nowhere in the report is there a reference to the difference in character between the Province and what we find in this country. I claim no great expertise to talk about Northern Ireland in any context. In fact, in my adult years I have visited the Province on only one or two occasions. But I recall that, even as one looks down from the aeroplane, a striking difference is to be seen. What did that difference in landscape bring to mind? I could only think back to my very early childhood. The hedgerows were still there, and the landscape was small-scale.
I have made inquiries, and I think that the relevant point which is not mentioned in the report is the change of circumstances among people engaged in agriculture. I understand that, whereas about 14 per cent. of the population of Northern Ireland are still engaged in agriculture, in this country the proportion has already fallen to 2 per cent. I should not like to be bound by the figures, but I think that
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hon. Members from Northern Ireland will accept that they still have a significantly larger number of the total population in agriculture than we have in this country.
Looking at the report, I feel that there is a certain nostalgia reflected in its pages. On page 25, recommendation 7 is that
"attention should be given to the wishes of rural dwellers to preserve their rural community connections and identity even though they may choose to work in urban areas."
Whether we speak of Great Britain or of Ulster, we must recognise also what is said on page 11 of the report:
"…the drift away from the land has been evident in the Province for many years."
It is my contention that that process has gone much further in the rest of the United Kingdom than it has in Northern Ireland, but I believe that hon. Members will find that it has significant effects for Northern Ireland, too. No doubt there are historical reasons for the present relationship. Indeed, the report makes the point that
"The agrarian history of Northern Ireland has also created an emotional dimension to land ownership that is unusually intense"
and it points out that
"The mainly 'owner-occupation' system in Northern Ireland has to be contrasted with what is, generally, the 'landlord-tenant' system in the remainder of the United Kingdom."
Our experience in Great Britain has been that people have a love of the soil, especially when they own it. The problem for farmers even in Great Britain, when faced with the new techniques in agriculture and the new intensive methods, often capital-intensive methods, and economic competition from the larger holdings has been that, whether in pigs or in dairy farming, they have tended to put up one more lean-to and carry on with a difficult and hard job, frequently finishing up working 80 hours a week. I ask hon. Members opposite not to put that matter aside lightly.
There has been reference to local planning decisions and local input. I lived in a village for many years. I know very well that there is likely to be resistance from people engaged in agriculture. I do not say that in any political sense. It is just that there are farmers on the local authorities and so forth. I know from hard experience that if it is proposed that a factory should be set up in their area, they are not likely to be very

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co-operative, because the workers employed in agriculture—I am sure that this is true in Northern Ireland unless circumstances there are very different—usually have lower wages.
I recall what happened in one village when some local authority housing was put up. When the farm workers moved out of their tied cottages into the dwellings put up by the local council, they speedily got jobs anywhere but in agriculture—on the railway, as roadsweepers for the county council or whatever it may have been.
I am therefore a little suspicious when I see reference to industry mainly associated with agriculture. This is an interesting idea—it has possibilities—but I do not think that we should lead ourselves to conclude that, if we can somehow have some small units of industry in the villages, this will dead to changes in agriculture so that farmers, farmers' daughters and part-time farmers can work in industry. We shall not change the general feeling of the villages and rural areas in that way.
What generally happens is this. I take the example of Scunthorpe, which I know very well. People have the dream of living in the countryside. Every Englishman—and, I take it, every Ulsterman—has his dream of settling down in a country district, with roses round his front door. But who is he when he comes to live there and do the infilling? He usually has his car. in my context, he will probably be a steel worker, a tradesman with a good income, and he comes into the village to live. But he is really no part of that community. He commutes in and out every day in his car. He is not concerned with the general services.
It has been said that the planners should not have the job of deciding how many shops there are in a vilage, how many butchers, bakers and candlestick makers. There may be a point there. But what is happening is that overall the number of people who are the true rural dwellers has declined. I have a feeling that that will happen in Northern Ireland. The people with the cars will come in. It is not the planners who are chasing them out; it is the fact now that we have supermarkets and hypermarkets, and people can shop there.
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It may be instructive—perhaps it is happening in Northern Ireland now—to look at the number of sub-post offices that have disappeared from our villages. As the standard of living goes up, more and more people are mobile, and more and more are not the traditional villagers that we once knew but are coming in from a considerable area. They choose to do their shopping at the supermarkets and the hypermarkets. So it is very difficult for people to make a living in what were the old and accustomed ways.
I do not welcome all this. It may be that in Northern Ireland there is a chance for the Province to tackle matters differently. In spite of all that I have said, I do not think that we in this country have solved the problem. I think that there are possibilities with the small factory. Very much of this thesis, though, depends en that kind of approach. But it would be wrong not to anticipate the real difficulties that stand in the way.
There will be changes. Because of the system of land tenure, I think that people will tend to cling on to their small farms, where we have rooted out the hedgerows and have had massive amalgamations until our countryside is as different as chalk from cheese from what it was. The right hon. Member for Down, South (Mr. Powell) is older than I am. He will remember what our countryside was like when he was young. It is now very different from what it was. It is rolling country, so there is more dairy farming, perhaps, than in the context of Northern Ireland. So I think there is scope.
I certainly would have hoped that in this document more words would have been written on the subject of Northern Ireland having about 14 per cent. of its total population still in agriculture, whereas we in this country have 2 per cent.
The point is that as we go down this path—perhaps we could look at the figures for the United States, where although things are not entirely different, there is much more mechanisation and so on—the tendency, all the time, is for the little man with his pigsty, six pigs, or whatever, to be replaced by the pig factory. That is what they are. There are the broiler units and people going to work in factory conditions, which is perhaps the only area in our own agriculture where these units are operating.

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If hon. Members were to read the provincial Press in this country—these matters are not often reported or debated in the House—the enormous problems that these units cause in villages would be obvious to them. There are problems of disposal of effluent, the obnoxious smells that are produced, and so on. They are very often unwelcomed by the traditional rural element. I have just attended a protest meeting about the installation of one of these units.
I urge hon. Members not to be too wildly enthusiastic about this report. I think that this is the start of the debate. It makes a contribution. Very often things go on in the Province of which we, as English Members, should take more note, in relation to some of the aid to industry and the changes that have been made. Some of it has a significance for us in this country.
If it were that even in that one field, some progress could be made towards integrating some form of industry in a rural setting without destroying the existing pattern of real community, which has much to commend itself, that would be a singular contribution that we should support. However, I am bound to say that I do not think it will be as easy as that. We shall watch and see how it progresses.
8.33 p.m.
Rev. Ian Paisley: It is always good for hon. Members representing the rest of the United Kingdom to sit in on these debates and make their contribution. I welcome the contribution of the hon. Member for Brigg and Scunthorpe (Mr. Ellis). But the fact of the matter is simply that different regions of the United Kingdom are entirely different from each other.
Northern Ireland, in its history, its agriculture, its tenancy of farms, its viability of the smallholding, and the desire of the people not to have a break-up of village life and rural community, is entirely different.
The hon. Member was talking about people from the towns wanting to move to the country. Our problem is rural people being forced into the towns against their will. That is why, for us on this Bench, the Cockcroft report is a breath of fresh air blowing through the planning offices, where people with pencils and
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paper are trying to regulate where people will live and how they shall be pushed out of their heritage. That is why there is a fierce confrontation in Northern Ireland between the people and the planners.
Things are so bad at the moment that whole district councils are voting against every proposal of the planning officer because that is the only way in which they can protest. One councillor told me the other day, "We have decided to vote against everything he brings forward, because that is the only way to make him heed our opposition." No planning department can succeed without the cooperation of those for whom it is planning.
The right hon. Member for Down, South (Mr. Powell) raised one important point—that no elected representative should be asked to act in a judicial capacity. They are there to administer. Bringing councillors into an independent planning appeals board will not remedy the matter. They should sit in the council, taking executive decisions which can be appealed to an independent board. Elected representatives should not sit on a judicial planning inquiry. If we proceed in that way, we shall go further astray. That is one disagreement that I have with the report.
On balance, of course, I would far rather go before an independent tribunal as envisaged in the report than the Appeals Commission of Northern Ireland. Some hon. Members on this Bench will agree with me on that. I do not despise what the Appeals Commission has done within its parameters, but many of its decisions are contrary to the spirit of good planning. I have some experience, having been told by the commissioner that I appear at planning appeal tribunals more than any other elected Member.
The district councils must have a true executive role in the planning of their own areas. That is where the change should come. I am not as optimistic as the right hon. Member for Down, South that the Government will bring democracy back to Northern Ireland through those councils. The Minister has to do some hard thinking about giving the district councils a proper executive role. It is strange that, after deliberation, whole district councils should tell the planning officer that they do not like his decision and that he should reconsider it, only

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to be told by the planning officer, "I refuse. I have the authority. That is my decision, and you can appeal if you wish."
Under the present appeals system in Northern Ireland, others who think that they will be aggrieved have no right of appeal. After all, it is not only the person asking for planning permission; there are other persons who, if planning permission is granted, may think that they will be aggrieved. If the planning officer decides to grant someone the right to build a factory or a hotel or a house, others in the neighbourhood who might object to such development have no right of appeal. Once the planning officer authorises the development to proceed and it is accepted that he is right, there is no appeal by other aggrieved parties. I believe that third parties should be able to set forth their objection to planning decisions.
I commend the authors of this report. They have set before us a very important point in paragraph 25 where they say that planning has been geared to the Northern Ireland regional physical development strategy, whatever that may be. They say, in other words, that the decisions in planning are geared to an overall policy which envisages that the rural areas will be depopulated by almost 5 per cent. from 1975 to 1995. I do not want the rural areas to be depopulated at all. I want the population to stay there. The authors also use this vital sentence:
"evidence presented to us has overwhelmingly indicated that the policy is forcing the disintegration of rural communities with the consequent loss of social stability and declining use of earlier investment in churches, schools, halls, roads, water and other services; in short, the result of the rigid application of the rural planning policy is seen as a depopulated countryside scattered with abandoned buildings and derelict dwellings."
What an indictment that is.
My constituency is perhaps the longest rural constituency in Northern Ireland. It stretches from the borders of Carrickfergus right to Portrush and then down to Toome Bridge and the borders of Randalstown. I see these derelict dwellings. I am amazed that, when a farmer's son says that he would like to remove an eyesore and build on the site—a site which is usually surrounded with mature trees, a site which is ideal
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for the building of houses—he is told "You cannot do that. We do not want rural development".
I congratulate those who made representations to the authors of this report because, by so doing, they ensured that many important points were brought out.
There seems to be a crazy idea that a farmer's son, when he is about to get married, must have his house built right beside the original farm house so that the two houses are together. No young man wants to set up right under the eye of his in laws—they are sometimes outlaws, as we all know, and perhaps some have more bitter experience of this than others.
There must be flexibility. I have stood on farms in my area and have heard the planning officers arguing down the throat of the farmer's son. I am thinking in particular of a farmer's son who is not engaged in a work outside farming but is the heir to the farm; his father and mother will soon hand over the reins. Yet the planning officers insist that his house must be built cheek by jowl with the parents' house. On one farm in the Rasharkin area, the only site available was the dunghill. The planning officer said to the young man "You will clean that up and that is where you will build."
This is a fact of life. I said that there was a suitable site across the road, but he replied "We shall have no building across the road". What attitude does that young man adopt to farming when he finds that an officer in the Northern Ireland Office is not prepared to allow him any leeway?
The report says that there should be a little positive thinking in planning in Northern Ireland and that we should adopt a positive and not a negative role. Those of us who have been at these planning appeals know how the refusal is worded. It is said that if permission is granted the development will affect the amenity of the countryside. That is the jargon of the planners. When one asks how it will affect the amenity of the countryside, the official goes into long, high-sounding phrases to defend the amenity of the countryside. I say that the sites at present occupied by derelict dwellings that are scattered across the countryside are the ideal places to build

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these new houses. Let us do away with the derelict dwellings, and let people build on those sites and thus bring fresh life into the rural districts.
I have to laugh when I hear someone say that if there are sceptic tanks they will pollute the countryside. There are thousands of houses in Northern Ireland that have no septic tanks. They have what an old politician in Northern Ireland called Adam and Eve sanitation, and this has been going on for generations. People have been burying their sew-wage in the back garden. It would be far better if they were granted planning permission for a septic tank and were allowed to have some amenity in their homes.
The committee says that we should bring a breath of fresh air into the matter and be positive in what we do. It is time that we had this breath of fresh air An 85-year-old constituent of mine still carries her bucket out every day. People such as her should be allowed these amenities, and the idea that water courses will be polluted by allowing septic tanks to be used is ridiculous.
Another important matter dealt with in the report is the attitude of the planners to commerce in these rural districts. We have in Northern Ireland a series of what are called area plans. They have no statutory authority, but every time one goes to a planning appeal these plans are pulled out and one is told that one area is allocated for one purpose, another for another purpose, and yet another for a different purpose again. If the planning officer is asked what statutory authority the plans have, one finds that there is none. They are just ideas on the board. They are just a dream, and those concerned want to make everybody conform to what is really a nightmare.
In my own area in Portglenone the area plan has allocated a section of the area for industry. In other areas, such as Ahoghill and other villages, all the sites have been taken up but in Portglenone not one industrial site has been taken. Why? It is because that is the worst terrorist area in the district. Policemen have been shot and murdered in that area. No industrialist or workers will go there.
I raised a case with the Minister who is responsible for commerce in which the
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planners had turned down projected industrialisation which would have provided work for 40 people. They did so because the man concerned refused to go to an area that would put both his building and his workers in jeopardy.
The matter went to the planning appeals commission. I fought the appeal, and the vice-chairman of the commission, who presided, recommended that the man should have permission. But when the man returned to the commission he could not persuade the people concerned, who had never heard about the case, that they should grant permission. Therefore, he asked that when they turned down the appeal his name be written in as protesting against their decision.
Those are some of the things that are happening in the appeals commission. I am glad that the Minister overruled the decision when I appealed to him, and that that industrialisation in that small village is going ahead and that 40 jobs will be available for the people there.
The Minister must have a hard look at the so-called area plans. I feel very strongly that this first ventilation of comment on the report will be helpful. But the Minister will need to take some interim decisions. I refer especially to the proposal about the in-fill sites. I have been at planning appeals where the planning officer has said "We shall allow one house there" and it was possible to put three there.
If the Minister is to make a decision later, he should surely deal with some of the matters that could have a decision made on them now. He could do some hard thinking now. I do not know what representations he will receive from district councils that will affect his decision on in-filling. The practical thing to do is to permit the in-fill sites. I believe that that is a decision that the Minister will need to take rapidly.
The length of this debate is limited. I have made the points that I feel need to be made about my constituency. I trust that we shall again have time for debate on the Floor of the House, after the Minister has heard the representations that will be made to him. I also trust that he will realise tonight that there are some decisions he could make rapidly that would at least ease the position and put encouragement into the hearts of those

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who are prepared to invest, rather than go to public housing, in the rural community in order to hold it together.
In many rural villages both sides of the religious divide are well represented They live together and go about together, and there are no problems. The villagers of Northern Ireland have been practically immune to any discord between factions in village life. When those people are transferred into the ghettos of the city, when they are taken out of the environment that they have been used to and are put into an environment where they no longer have the stability that they had, they become an easy prey to the strife that can arise in those cities. Therefore, a contribution to the stability of our country can be made by the decisions that the hon. Gentleman has to take.
8.53 p.m.
Mr. Harold McCusker: Like the hon. Member for Antrim, North (Rev. Ian Paisley), I welcomed the contribution by the hon. Member for Brigg and Scunthorpe (Mr. Ellis). I do not want to get into waters that I am not too familiar with as eagerly as he got into the Northern Ireland waters. The hon. Gentleman was not comparing like with like. Whilst his contribution was interesting, a better understanding of the rural situation in Northern Ireland is needed if one is to make a contribution that has some meaning.
For example, the hon. Gentleman talked about the 14 per cent. of the population who are engaged in agriculture in Northern Ireland as against the 2 per cent. on the mainland. I suggest that, although that 14 per cent. will reduce somewhat, it will not reduce much more. If it settles at around 10 per cent. or 12 per cent., that will be much healthier for Northern Ireland than the 2 per cent. is for Great Britain. The 2 per cent. on the mainland to which the hon. Gentleman referred is the consequence of the explosion in population that occurred in the cities on the mainland after the movement had taken place from the country into the town. That 2 per cent. on the mainland does not relate to the 14 per cent. or whatever in Northern Ireland.
Mr. John Ellis: I was merely posing the question for the purposes of this debate. The hon. Gentleman must recog-
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nise that, for example, milking machines are invented and people use them. A man may keep many more cows than he wants to. All I am saying is that there is a danger in the traditional pattern of rural life. There is equally a danger if we introduce the factories. I am interested to know who will live in the houses which form part of the in-filling programme. I have derelict houses in my constituency. The young people engaged in agriculture move to the towns. Those who take their places are not necessarily engaged in agriculture or working in the villages.
Mr. McCusker: The hon. Gentleman must understand—and if he were in County Armagh for a while I could quickly show him—that the problem is housing the people so as to keep them in the rural areas. Just 120 years ago North Armagh was the most densely populated part of the island of Ireland. In any road or lane in that part of my constituency there would have been one cottage after another. The famine certainly had its effect and reduced that population substantially. But it is still a predominantly rural area and highly populated. As one drives through it, one can hardly go 250 yards or more along a road without coming to two or more houses. Family sizes in Northern Ireland are substantially larger than in Great Britain and there is a desire on the part of those who were born in the country and have lived there for 20 or 25 years to remain there.
We have a substantial rural-dwelling population who travel five, 10 or 20 miles to work. There are many antiquated cottages, many of them belonging to the Housing Executive and as lacking in facilities as others referred to earlier in the debate. They were originally built for farm labourers and are now occupied by their descendants, who are perhaps tradesmen. Very few of these people are unemployed. Most of the unemployment is in towns such as Portadown, Lurgan, Craigavon, Belfast and so on.
There are very few people in Northern Ireland, with the exception of the old populations of Belfast and Londonderry, who are more than one or two generations removed from the country. Most adults could trace at least one of their grandparents to a rural background and most children in Northern Ireland today have a grandparent engaged in some form

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of agriculture. The historic feeling for the country is a tremendous driving force throughout the community.
We need only witness the struggle by those still living in the designated area of Craigavon to hold on to what they think of as theirs, even though it has been taken from them for the so-called greater good—not a greater good which I support—to understand that feeling. Last week there were some disturbing scenes in Craigavon with one or two of the remaining farmers there trying to cling on to what is theirs and to get a fair deal before being evicted.
I am constantly having to help constituents to hold on to what is a fundamental dream of most of them, namely, to remain on their farms or at least to remain in the rural areas where they have been brought up and where their families have lived for generations. I could cite examples of how the planners have applied this strict test of the proof of necessity. I remember the case of an elder son of a farmer who would eventually inherit the small farm. At the time he was working in a factory belonging to a multinational company in Craigavon. He had married but had not set up house because he was hoping to build on the farm. His mother and father were due to retire and he was expecting to take it over in a few years' time.
We managed to obtain planning permission at the appeal only by showing that the shift system he was working was not a normal three-shift rotation system of five or six days a week. We managed to show that he was working the continental shift system of three by two by two. I was able to argue that because he was working three 12-hour shifts a week he had time to engage in certain agricultural activities. I believe that the persons who heard the appeal would not have accepted that if he had been working five eight-hour shifts a week he would have had time for such activities. That is the sort of nonsense one encounters in trying to get planning permissions for such people.
I have never considered that the countryside, particularly in Northern Ireland, would be enhanced if it were devoid of buildings. I think that part of the attraction of Northern Ireland's countryside is its vitality and the life that
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exists because of the population that is there. This point was eloquently made by my right hon. Friend. Certainly there would be nothing for me in a barren countryside in County Tyrone, County Fermanagh or County Armagh. I would find it strange.
I support what my right hon. Friend said about Great Britain. I find it strange travelling through Somerset and Dorsetshire, going on mile after mile without coming to a farm or a group of buildings, but then coming to an attractive village or hamlet with another five or six miles further on. It is beautiful and attractive countryside for me to visit, but it is not the sort of countryside that I should want to live in. Nor would, I think, the majority of the people of Ulster, but for very different reasons, of course.
What I like about the Cockcroft report is that it is concerned with people more than with plans and strategies, and I am glad that there is an emphasis on rural dwellers, people who live in the country but do not necessarily work in agriculture and have established a right over many generations to continue to live there. For example, rural churches have declining congregations, but members of such declining congregations will travel five or 10 miles to attend what they regard as their own church. They will travel far in order to keep their traditions going.
I never cease to be surprised on a certain day each year—not so far away now—to see people walking behind a banner designating a rural district miles away from where they now live. They are behind that banner because their grandfathers or fathers came from that place, and when they themselves came of age to join they joined where the family had its roots.
Many people have a strong desire to build in these areas. I do not want to see good farmland destroyed any more than anyone else does, but there are many pieces of land on farms which are barren or derelict. I am glad to note that the divisional planning officer in Craigavon has given planning approval for a house on a piece of land on a farm which had no agricultural value. I hope that more consideration will be given to that kind of action.
Permission should be given for more replacement dwellings. I have never

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understood why those concerned about the appearance of the countryside should be prepared to put up with derelict buildings when a well-designed modern house could replace it with much more attractive effect. I certainly want to retain firm control on the type of housing built in the countryside, and I like the section in the Cockcroft report which deals with planning advice centres which would help in such matters. Emphasis put on the overall design of buildings in order to establish some sort of uniformity might be useful as well.
I agree with the reservations that have already been expressed about the buying of land around villages. I do not think that will go down very well. Perhaps the committee came to that conclusion because it could not suggest any other way in which one could meet the point it makes in paragraph 22:
"That the Department pursue its general aims in a more positive manner, not only by allowing, and being seen to allow, a certain amount of housing in the open country".
I suppose that that can be achieved only if people are allowed to buy land and go somewhere else. I do not quite know how the Government intend to put that suggestion into operation.
As I have said, I welcome this report because it is a human document which reflects the values of the people in Northern Ireland. If a mistake was made in relation to where the planning policy originated, perhaps it was the fact that Dr. Cockcroft brought with him the same views as did the Minister.
The Minister will remember saying to me a few weeks ago that, while he always knew rural planning to be important, he had never realised that it was such a burning political issue until he came to Northern Ireland. No doubt his views were conditioned by the fact that there is a particular rural policy in England which is generally accepted. No doubt Dr. Cockcroft also arrived in Northern Ireland conditioned by that policy. Perhaps that is why the Committee came to that conclusion. Irrespective of how the Committee reached that conclusion, the fact is that the policy as we have known it for the past few years has been wrong. I hope this report will go some way towards changing it.
9.7 p.m.
Mr. Michael Males: May I first thank the Minister for his kind remarks which he made at the outset of his speech. I noticed that they were made before I caught your eye, Mr. Deputy Speaker, or had opened my mouth. I hope that he will have no cause to regret it when I have finished.
This has been an interesting debate on an exceedingly interesting document. I should like to associate all my right hon. and hon. Friends with the expressions of thanks and congratulations to Dr. Cockcroft and his committee on having produced such an excellent report.
The right hon. Member for Down, South (Mr. Powell) took us through the meat of the report with his customary lucidity. I shall not seek to do that again. If I were to be so bold as to try to summarise what he said, it would be that this report had examined and identified all the problems with devastating effectiveness. If I am to ask any critical questions during my remarks, it will be whether the report goes as far down the road in offering solutions to these very difficult problems. Indeed, I believe that the contribution of the right hon. Member for Down, South and, indeed, that of the right hon. Member for Belfast, East (Mr. Craig), stopped short of a really tough attempt to provide the answer which is clearly lacking in relation to the whole range of planning policy in Northern Ireland.
Since hon. Members from Northern Ireland have been through the guts of the report, I shall only skate lightly through the body of it and concentrate my remarks on the recommendations at the end. I refer to paragraph 6, which the right hon. Member for Down, South mentioned as a significant difference between one part of the United Kingdom and the rest. Normally that is something which he tells us should be otherwise. The report says that it does not regard
"the historical need to prevent suburban sprawl and ribbon development…to be the major criterion of a rural planning policy for Northern Ireland".
It alleges that this is the major criterion in mainland England and points particularly to the South of England. It seems to suggest that the situation in Northern Ireland is so different as to require a very major difference in the laying down

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of criteria. The report does not say what the committee thinks the criteria should be. It mentions the differences and problems in rural Ulster, but it does not go any further. I would have liked to see another set of criteria put forward for discussion since the committee felt the existing ones were wrong. But we do not see that in the report. Perhaps in the widespread discussions that will be held in the coming months we shall hear from the Minister what these criteria might be.
The same criticism will apply when we touch on the fearful lack of democratic control over planning procedures in Ulster. Having identified these problems lucidly in his speech, the right hon. Member for Down, South begged the question on the solution to them. If he believes that it is wrong that district councils should not have a say in planning; if he believes that it is wrong that all decisions should be in the hands of bureaucracy; and if he believes it is wrong—and here I agree with him—that district councillors should have a say in an appeal procedure, rather than in the initial executive decision, then he owes it to us to say what the solution should be.
I think it would be wrong, if control were introduced at district level, for it to be only for appeals. If one elects local representatives for anything at all, it is to decide something, not to change a decision that has been taken bureaucratically.
Although it has been suggested that planning decisions could be left to the district councils, would it be right or justifiable in the overall planning context of that part of the United Kingdom to leave all such decisions in the hands of 26 different councils? If the proposition is that that would lead to a lack of coordination and a lack of overall discernible policy one must ask how it should all be drawn together. For the life of me I can see no other way than by setting above the district councils some sort of body or authority that can draw the strings together and produce a comprehensive planning policy for the whole Province.
Rev. Ian Paisley: Surely the old county councils, which had this planning authority, had no other council above them to appeal to. They went straight to the Department. Why cannot the Department take over this role that it had before?
Mr. Mates: The hon. Member cannot have it both ways. He said that he wants the Department to do it, but then he will charge the Minister once again with being remote. Although the Minister is an elected representative, he was not elected by anyone in Northern Ireland and the Department would be taking decisions in an arbitrary way—
Rev. Ian Paisley: The point is that under the old system the county councils had planning authority. They made the original decision and the only appeal from them was to the Department. Why cannot we reimpose that system? That will not give the Department complete power because the first decision will be made by the local authority.
Mr. Mates: If we are to restore democracy, we must do so throughout, and we must start at a much lower level. But between that lower level and a central authority there must be some democratic answerability. In the old days of the county councils that answerability existed, but those days are gone. We are now seeking other solutions. The Conservative Party has devoted a great deal of thought and study to this topic and we have put forward suggestions as to how the matter should proceed.
My hon. Friend the Member for Abingdon (Mr. Neave) has made clear that an incoming Conservative Government will look hard at the possibility of setting up one or more regional council. He was referring to an upper tier of local government—not simply for planning, although planning must come into the matter. Unfortunately, I believe that this section of the report looks at the problem too narrowly. To set up an upper tier for planning purposes only, as the report suggests, would only proliferate those statutory authorities of which many people believe there are far too many in Northern Ireland at present.
There are some recommendations in the report which appear to me to be questionable, to say the least. I do not want to be too critical when I say that the report is rather short on solutions. Although one can understand and sympathise with the desire to cure, there are one or two suggestions, particularly involving the central authority, which might leave us worse off than we were before. Recommendation I says that if planning

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is refused, the unsuccessful applicant should be offered an alternative site. That is a reasonable sentiment, but recommendation 2 says that the Northern Ireland Housing Executive should purchase these sites and, if necessary, subsidise the unsuccessful applicant in the choosing of an alternative site if his first application has been turned down.
It will not take the sharp Ulsterman long to realise that that is a very good way of obtaining a piece of subsidised land, even if it is the piece of his second choice. That is what will happen, unless these matters are carefully controlled. Once again it can ony be centrally controlled. Before such a recommendation is accepted, it will need to be closely examined.
Recommendation 16 has already been covered very fully I wish to emphasis that I do not think that suggestion is the right one. It is surely not right to say that the first time one introduces the democratically-elected voice, it should be in the context of an appeal and not a decision.
The report recommends that not only those who have been refused permission should be allowed to appeal, but also
"third parties affected by planning decisions".
From my knowledge of local planning, I consider that that recommendation seeks to go a long way further than the system that exists in the rest of the kingdom. That is opening the door to the representation of interests by third parties which are not fully concerned with the planning application itself.
Recommendation 23 speaks of applications
"to build well sited, well designated factories and workshops, even with Areas of Outstanding Natural Beauty",
and adds that such applications should be sympathetically considered. Who is to decide whether what is being considered is well-sited or well-designed? Who is to decide whether an area of outstanding natural beauty can take such well-sited and well-designed buildings? If these decisions are to be taken, surely it is irrefutable that those decisions must be taken by those who are answerable to the local community on whose behalf decisions are taken?
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The same argument applies to the design and attractiveness or otherwise of houses. It is all very well to knock bureaucrats and planners and to say "They sit in their ivory towers deciding whether this or that is aesthetically satisfactory". They must be helped and consulted, but, above all, they must be supported by a democratic body for which they must work. That is the system which, roughly speaking, has made the planning laws acceptable in our community. It should be looked at in the context of improving democratic answerability as the supreme criterion in trying to solve all the problems posed in the report.
For the life of us, we cannot think of any way of achieving this other than by evolving some form of local government to bridge the gap that exists, not only in planning, as is shown so clearly in the report, but in many other areas where the events of the past five years have left problems over the government of Northern Ireland which we all seek to solve and which must be solved by the extension of local democracy and the powers of local authorities and by ensuring that they are answerable to the people whom they will have to represent, in order that we can be sure that decisions will have the agreement of the majority of people in Ulster.
9.21 p.m.
Mr. Wm. Ross: I start by expressing the thanks of my right hon. and hon. Friends to the Opposition for making available this half day for an important debate which has considerable social implications for Northern Ireland.
The Minister will not be able to answer tonight most of the points that have been put to him, but I hope that he has taken them on board and will consider them before reaching final decisions on the report. The hon. Gentleman should be under no illusions. This is an emotive and highly political issue in Northern Ireland. It always has been and I believe that it always will be.
Paragraph 38 of the report states that councillors should have far more than a consultative role. That is a self-evident truth for those of who, like myself, have been councillors, but it is a complete reversal of the present policy. It will give far greater control to councils and

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will drive a far bigger hole in present planning policy than most hon. Members realise.
The planners were not happy with the former system under which they were employees of county councils. They wanted to get the power into their hands. They did, and, as I said last week and as the hon. Member for Antrim, North (Rev. Ian Paisley) said tonight, the result has been open warfare at planning committee meetings. There is no responsibility for action taken by councillors and therefore no sense of responsibility in councillors. My colleagues and I have seen this at first hand, and I believe that there will never be any responsibility in the people concerned until they are made responsible for the decisions that are taken. I warmly welcome the recommendation in the report.
One of the most annoying problems for councillors is that the zoning changes every few years and can be completely changed within five years. People do not know where they are from one year to the next. Any decision taken on this matter must last for a very long time.
Few councillors and few other people in Northern Ireland have ever had a clear understanding of the objectives of the present planning policy, which has not been understood. A great deal of the criticism that I have heard about the application of that policy stems from ignorance. I am afraid that there was never any serious effort made to educate people as to the true position. Even when it was understood, nobody liked it. It was not accepted. I believe that the Cockcroft report sets out to correct a great deal of what was amiss.
One of the great problems, and the one that has concerned me most, about the present policy is that its application created a special category of people who could build houses in rural areas. I believe that this was based upon the assumption that Northern Ireland either would be turned or would turn naturally very rapidly into a highly urban society. The people of Northern Ireland did not want that to happen, and they resisted it in many different ways.
I believe that that whole theory was nothing but nonsense anyway, because the people of Northern Ireland have an
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infrastructure in the country of houses, of schools and of churches that they want to maintain. They have a very close-knit community. I often think that it is just like a fishing net. It is closely bound together into the life of the community. It is, in fact, the community, and the people do not want to leave their homes. It is part of the general parochialism of the Northern Ireland people.
The people who were not allowed to build where they wished—there were many hundreds of them—were absolutely furious when the refusal came out. They tried to get around those refusals in every way they could think of. There were all sorts of special cases, hardship cases and medical cases. I think that some of them were simply invented. The trouble was that, once permission had been given on special grounds—and sometimes the medical cases were terminal cases—whenever the person for whom the house was erected died or went away, the house was still there and could be seen. The new occupant was there in contravention of planning policy, and in fact would not have been there if the house had not been put up originally on the ground of special hardship.
There is a danger in the Cockcroft report in that it seeks to perpetuate the special category by multiplying the number of people who will qualify. I think that this is wrong, and I shall return to that aspect later in my remarks.
All of us from Northern Ireland are very much aware of the scenic beauty in the place, and we want to preserve it. There are many people in Northern Ireland who want to live in a beautiful, well-designed house in a prominent position on a hillside perhaps or at the top of a hill, with a nice view. There are many people who would want to live in a more secluded area. Quite often they wish to live close to a hamlet, village or town. But the countryside consists of people and houses. If there are not people and houses, what is there to look at? Where is the beauty? Where is the life? Where, if it comes to that, is the whole of what one could call Northern Ireland society which has existed in the country areas?
I do not think that I have ever seen a photograph or a landscape of Northern Ireland without a pretty bungalow or a pretty cottage in it. The houses and the

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people make the countryside what it is. I can safely say that we want to see a nice countryside, with the beauty preserved, and with quite a lot of houses and people living there to ensure that it stays beautiful.
Having said that, I suggest that one of the principal reasons for young people wanting to live in the country is that many of them can get a cheap building site. The economics of it are apparent, for, if a young man or a young woman can get a building site on the parents' land, usually it costs nothing. Cockcroft, in fact, recognises the economic argument by asking for subsidised plots near villages. If there were not an economic argument, there would be no reason to seek subsidised plots. In many cases this is simply an attempt to cut the cost of providing the house. The nut amount saved is probably between £2,000 and £3,000 per house. That is a substantial sum to any young man or woman, and it is worth saving.
The flight from the urban areas to the suburbs and the countryside is not so much a flight from a town as it is from the housing estates in which young people live. Many housing estates have been designed appallingly and the layouts are shocking. Should anyone require confirmation of that, he should examine the housing estates from which young people wish to escape. They want to move to estates where the houses are not jammed on top of each other and where they are not looking in each other's back windows. There is no difficulty in persuading tenants to remain in pleasant council estates. This aspect is too often ignored.
I turn to the summary of recommendations. I welcome the recommendation that there should be a relaxation of policy on in-fill sites. I draw the Minister's attention to the danger that is inherent in that if it is carried too far. The figure of two houses was set in an effort to prevent ribbon development What will be the number in the new policy? Will it be three, five, seven or nine? Alternatively, will in-fill sites be permitted only off main roads or down short driveways?
The report stresses the need for research into the problems of the special needs areas. We can recognise the needs on the outskirts of Belfast, Fermanagh or
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Tyrone. One can see the different approaches in different areas. It is clear what is needed in those areas. But not so clearly understood is the effect of the present policy on those who live in the countryside where there is an ageing population and few young families. The population in the countryside, particularly in the more isolated places where no building has been allowed, is unbalanced and unhealthy. Something must be done about that. It can be done only by allowing young people to bring up their families in the countryside.
One of the most difficult problems to solve is that which involves the individual who wishes to live in the country for a special reason. I do not know how one can deal with that problem. The problem caused by the individual eccentric will always be with us.
My hon. Friend the Member for Antrim, North (Rev. Ian Paisley) drew attention to the problem of the farmer's son who wants to build a house beside a farmhouse. One aspect of that has concerned me. Often the young man or woman is told "You will build your house there." That is usually the place where the farmyard should be extended. I have seen such houses built in the place where the farmyard should have been extended and the whole farm process has been thrown out of gear as a result. That is usually unnecessary because there are good sites a couple of hundred yards away.
I welcome the recommendation on the fostering of agricultural and ancillary industries in the countryside. But I am not clear what is meant by it. If it means mechanical repairs to farm machinery, that is very welcome. If it means some sort of blacksmith's shop, that is very welcome. Equally, if it means a processing industry, that is very welcome. But sometimes these things grow, and what starts out as a small shop with a welder and blacksmith working in agriculture becomes a fellow selling tractors and farm machinery.
Mr. Powell: Why not?
Mr. Ross: It depends where it is. The chap then wants petrol pumps. He then wants a car saleroom. Instead of being tied to farming, the whole thing becomes tied to the general structure of the countryside.
Mr. John Ellis: The hon. Gentleman is making a point about industry and commerce mainly in the rural areas. I hope that he recognises where his reasoning is taking him. The point is—he is a farmer and he knows—that we have about 2 per cent of our total work force in agriculture and in Northern Ireland the proportion is still 14 per cent. If people are to get jobs in industry—if we are to allow the factories in—what will these people do? Eventually, Northern Ireland will move towards a more efficient agricultude, using less labour.
Mr. Ross: If the hon. Gentleman looks at the record of farming in Northern Ireland, he will find that it is fairly efficient now. My point is that the industry which started in a small way, for the repair of farm machinery, eventually grows, and it started there because the site was cheap, too. It is then in direct competition with the fellow who may well be on an expensive site in the nearest town or village. There is a problem here which is not easily overcome and it cannot be ignored.
I shall say a brief word now about areas of outstanding natural beauty. Architects may be prepared to provide well sited and well designed houses in such areas, but architects are like everyone else and they will eventually produce what the customer demands, which may not be quite in keeping with what the planners are seeking. I hope that the Minister will take that on board and in due course give us his thoughts about it.
In the same connection, what is the position regarding the Crown's interest? We have a wonderful area of outstanding natural beauty at Magilligan, and the first thing the Crown did was to build a prison which would take the prize for ugly building anywhere. It is not something which the people of Limavady district have welcomed, and I hope that we shall see it removed in the not too distant future.
Another aspect of this problem is the question of quarries and gravel pits. I do not see the grounds for asking for a levy on future development in this respect. Anyone who is now selling gravel sells just that—the gravel and the sand—and he holds on to the land, part of the deal being that the land will be restored after
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the gravel is removed. Therefore, any levy which is to be taken up from this day forward will be taken up, not to correct that which is now being carried on hut to correct the past sins of others who have already got their money and have long gone. Many of them, in fact, will be dead. This problem must be dealt with in a totally different way.
I referred earlier to the list of people in the farming community, including relatives, and even those employed in forestry and fishing. The list is nearly endless. If we add to that special personal and domestic circumstances, there will be hardly a person in Northern Ireland who could not find his way into that category by some means or other. Anyone who lives outside Londonderry. Belfast or the larger towns such as Portadown and Coleraine could come into it.
Therefore, if the Minister tries to keep and to expand the special category of persons who can live in the countryside for one specific reason or another, it is a line that cannot and will not be held. He would do far better to forget about keeping or creating special categories of persons and to accept that applications for building houses in the countryside should come before councils and before planners purely and simply on the merits of the application. There is no other way forward, and there is no other way out of the dilemma and the problem.
This is the only way that it can be done. Each application should be treated on its merits. The Minister should be prepared, whenever it reaches his desk, to accept his executive responsibility and act upon it. When we get a regional council—I hope that that will be in the not-too-distant future—applications would land on that council's desk and that council would be the perfect vehicle for exercising the executive function in this respect.
If the Minister tries to continue the path that has been set over the past three or four years, he will be heading deeper and deeper into trouble and will really only be making the problem worse.
Surely the objective view, and the professional objective view, of a building site and of a building should be the deciding criterion, regardless of any real or imaginary ties with the countryside.

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Tied to the cost of building is the value of the site. Some people may think that there will be a vast influx if the planning application is accepted on its merits, but I do not believe that that is so. Farmers value their land in Northern Ireland. Farms are small and people will allow only their own children to build. I speak from personal experience and the experience of my friends and neighbours. They do not like selling building sites. They will sell them only if the price that is to be paid is far above the current market value.
If the Minister takes that fact into consideration, he will see that the dangers that often appear to rear their heads are not as real as they are sometimes imagined to be.
9.42 p.m.
Mr. Carter: We have had an extremely interesting, useful and constructive debate. In contrast to some of the discussions I have had about rural planning when going round the various councils of Northern Ireland, the debate has been extremely even-tempered and highly objective.
I am only too well aware of the importance of the whole field of planning in the rural areas in the life of Northern Ireland. The wider the discussion and the more intense the discussion, the better. As the Minister responsible for the Department of the Environment, what I want to see—and what I am sure any Minister who might step into my shoes at some later date would want to see—is a policy that is acceptable to the whole community.
I think that I would be right in saying that here in Great Britain, in most rural areas we have a planning philosophy that is, broadly, acceptable to everyone, irrespective of political point of view. Indeed, in my time in local government the question of politics never came into planning at all. We would vie with one another on the merits of a case, but the political attitudes struck by parties on planning were not particularly divergent. That is what I think we would all like to see in Northern Ireland—planning being treated on its merits and all matters of policy being freely consented to by all political parties and people representative of the community.
Mr. Molyneaux: Just in case the Minister has been misled by the little fatal sentence in the report, perhaps I could assure him that in my six years on the Antrim county council, the key position on that council—namely, the chairmanship of the planning committee—was held by a gentleman councillor who would, had he been around today, have been a member of the SDLP. His recommendations were invariably accepted by the predominantly Unionist council without a quibble. The cases were always decided on merit.
Mr. Carter: I accept that entirely. I was not drawing inspiration from the Cockcroft report, because I know from going around the local authorities that members of the SDLP, the Unionist Party, the UDP and Alliance band together when it comes to rural planning policy. There is no question of party politics being involved. What I am talking about is the body political consenting to a central planning ethos. That does not exist in Northern Ireland and all of us who are concerned with government there desperately want to see it come about.
So I do hope that hon. Members are in no doubt that I am aware of the feelings on this subject. I have tried to pay as much attention to them as I can. Indeed, the genesis of the report was my discussions as I went around the Province. At times, some of these doubts and the depth of feelings are misplaced That is particularly so with the current workings of the policy. People seem to believe that the vast majority of applications are turned down. Indeed, the impartial observer of this debate might feel that planning is directed against all those who wish to build a house in the country side.
In that light, the figures for the whole of the planning districts combined might be interesting. In 1975, 71 per cent. of all applications in rural areas—that is on a strict definition of "rural"—were approved. In all areas, 85 per cent. of applications were approved. In 1976, the figures were 66 per cent. and 87 per cent. respectively; in 1977, the last year for which I have figures, they were 66 per cent. and 87 per cent.
The present policy might have warts and imperfections in some respects—I

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freely admit that—but on the basis of those figures, any fair-minded person will agree that we are being even-handed.
Mr. McCusker: I am trying to be a fair-minded person and I agree that the Minister is being fair by breaking the figures down. He will agree, I think, that as we are talking about rural planning, we must consider the rural planning figure. If 66 per cent. were approved, that means one refusal for every two approvals, which many would say was a fairly large proportion. But what the Minister does not bear in mind is that hundreds of people never go to the stage of seeking outline approval because their advice from the likes of myself, their legal advisers, councillors and others is not to waste their time, that if they do not have a good reason for wanting to live in that countryside, there is no point in applying. So there is a body of opinion, not included in the statistics, which keeps the pot boiling.
Mr. Carter: I find that difficult to believe. I accept that the hon. Gentleman might be prepared to advise people not to apply, but I did not think that people in Northern Ireland were reluctant to take the Government on. If people believe in their planning case, I think that they will come forward.
I cannot tonight say anything very positive about the report. My right hon. Friend and I want there to be the maximum possible debate upon it before any minds are made up. The local authorities will want to think carefully about the implications of the report, and I dare say that the Association of Local Authorities will want to see me.
I shall, in seeking to reply to as many as possible of the points in the 10 minutes that are left to me, reveal my broad thinking, although I think that most people will have a hint of it already.
Northern Ireland still has a basically rural community and, in that sense, it cannot be compared with any other part of the United Kingdom. One-third of its population lives in Belfast and the rest in the rural areas. There is still very much of a rural atmosphere around Belfast I accept that in a largely rural community the views of people living in rural areas should be reflected in our policies and planning.
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The right hon. Member for Down, South (Mr. Powell) said he did not want planning policy to move off in jerks. Nobody wants to see that. We want a policy to be adopted which everyone can accept, to such an extent that those concerned with considering planning applications can approach the matter in as detached a way as possible.
The right hon. Gentleman stressed the need for sensitivity. The figures I have just read out show that our present policy is fairly sensitive. However, others believe that we are quite insensitive. How sensitive can one be? One person told me—believing every word that he said—that we should not consider the two-thirds of cases that are approved but should think only about the 25 per cent. or 30 per cent., whatever the figure is, that are not approved, for that figure represented 100 per cent. He told me that we were refusing 100 per cent. of applications. That is a very strange use of statistics, but there are plenty of people in Northern Ireland who think in that way. The attitude is to support planning if it does what one asks of it but to condemn it as irredeemably wrong if it does not do what one urges upon it.
It is very difficult to get a balance in this highly sensitive area. Human judgments are involved and they are always fallible. By and large the officials in my Department do a pretty fair-handed job in getting the balance right.
The right hon. Gentleman also said that when he first went to Northern Ireland what made the greatest impact on him on looking out of the aeroplane window on landing was that there had been a pepper-pot approach to development. That is true. The trouble is that today that pepper-pot approach is proving rather more expensive than it did 150 to 200 years ago. Anyone who built a cottage or a small house in the countryside 150 years ago did not require much in the way of amenities. Today the story is entirely different—people want roads, schools, hospitals, telephone kiosks; they want a whole range of amenities which in a modern society they are entitled to argue should be theirs as of right. Planning then turns itself into an entirely different animal. We have to consider the use of resources, and in the current climate extremely scarce resources. We cannot

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contemplate scattered rural development that will place on public funds a burden that we cannot afford.
The right hon. Gentleman went on to say—and I think he was quoting when he said this—that planning had denuded the countryside. I do not think that that will stand up to any sort of examination. Long before planning came on the scene the depopulation of the countryside was running wild. In the majority of Northern Ireland—in fact anywhere in Ireland—depopulation of the countryside had gone on for many years before planning became anything like a feature of modern government. Indeed, last weekend I watched a programme on the television entitled "The Irish Way" which was about Connemara, a poorer region than most other parts of Northern Ireland. The interesting point was that its problem was no different. A different political philosophy was operating there, but people were running away from that part of Ireland in droves and nothing much that the Government could do was having an effect. The broad point that the right hon. Gentleman was making was that we cannot equate planning in Great Britain with planning in Northern Ireland. I accept that entirely, and that lies at the heart of what the Cockcroft committee said.
There is another interesting concept to which I thought the right hon. Gentleman might have got round. It is something that concerns me, and has concerned others in this debate. This is the concept of having an area of outstanding natural beauty and limiting the sort of development that goes on in it. I admit that I have some doubts about how we could effectively operate a policy of that kind in a community with a great deal of unemployment. It is not an easy one to deal with, because conservationists rightly feel, as do the rest of the community, that the countryside belongs as much to them as to those who live in that part of the countryside which may be designated an area of outstanding natural beauty. My natural inclination would always be that if we can produce a development that is as consistent as possible with the preserv-
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ation of the area as one of outstanding natural beauty, employment and opportunity should be a considerable factor in coming to the judgment that is finally made.
The right lion. Member for Belfast, East (Mr. Craig) said that as he was a city Member we might be surprised to see him participating in the debate. I am not surprised at that. People who live in cities, towns and urban areas have as much right as anybody else to participate in debates of this kind. It is our country, and wherever we live we have a right to participate in a debate of this kind.
The right hon. Gentleman went to say—or, to put it more mildly, to suggest —that property conferred rights, and he seemed to feel that planning and bureaucracy were interfering too much with the rights of the individual. I think that on reflection he will accept that in a modern society property confers only limited rights. If factories in his constituency owned by industrialists were committing a nuisance he would be the first, I am sure, to come running to my Department wanting some form of restraint imposed upon the people who were causing the nuisance.
He did not seem to feel that we had done enough to get the balance right between the individual on the one hand, and the community on the other. It is a sensitive issue—I accept that completely—but he can take it from me that we are trying all the time in the Department of the Environment to get it right, even though some people do not seem to feel that we are making too good a job of it.
The right hon. Gentleman also said that he was against subsidies, which rather surprised me, as Harland and Wolff is in the heart of his constituency. Quite where we should get in Northern Ireland without the quite widespread use of subsidies, whether in this area or the industrial area, I do not know.
My hon. Friend the Member for Brigg and Scunthorpe (Mr. Ellis) gave—
It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.

NORTHERN IRELAND (RURAL PLANNING)

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

REPRESENTATION OF THE PEOPLE BILL
Order for Second Reading read.
10.0 p.m.
The Secretary of State for the Home Department (Mr. Merlyn Rees): I beg to move, That the Bill be now read a Second time.
The purpose of the Bill it twofold. First, it proposes an increase in the limits of candidates' election expenses at parliamentary elections. Secondly, it proposes an order-making power to vary the limits on candidates' election expenses at parliamentary and local government elections. I shall deal with those purposes in turn, but first I should like to say a few words about the background to legislation on election expenditure.
The tradition, at least in recent years, has been for legislation on matters relating to electoral expenditure to be based on recommendations of a Speaker's Conference. Thus, the limits set by the Representation of the People Act 1948 were based on the recommendations of the Speaker's Conference of 1944 and the limits provided in the Act of 1969 were based on the recommendations of the 1965–68 Speaker's Conference.
The present limits, set in February 1974, were also based on the recommendations of a Speaker's Conference, though, as was made clear at the time, that recommendation had been produced very quickly in the context of an impending General Election. Indeed, the House may recall that the method by which that Bill was introduced in February 1974 was, to put it mildly, a little unusual. It was done through the process of a Ten-Minute Bill. As I remember, it was even done by a manuscript method.
The Government had hoped that a new Speaker's Conference on electoral law could be established to consider election expenditure generally as well as many other topics Unfortunately, it has not
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yet proved possible to reach agreement which the official Opposition on all the topics for such a conference; nor have they been willing to agree to the establishment of a conference to consider the undisputed topics—including election expenditure—without prejudice to the question of including the disputed topics at a later stage.
Bearing in mind that the next General Election must take place by October 1979, the Government thought it right to seek the views of the other main parties on the need for an increase in the expenses limits for parliamentary elections. I wrote to all parties in April this year. Not the least of the reasons was that I wanted to avoid what happened in February 1974. We suggested to them that an increase wase justified to take account of the fall in the value of money in recent years.
I do not think that it would be any breach of confidence to say that the response to our proposals was mixed. Some of those consulted considered that it would be right to increase the expenses limits to take more or less full account of inflation. Some felt that no increase at all was required. Most of those consulted, however, considered that there should be a substantial increase, but with more emphasis on the variable amount per elector than on the basic sum.
In the light of those views we now bring forward the proposals contained in the Bill. They would increase the expenses limits for parliamentary elections to a basic sum of £1,750 plus 2p per elector in a county constituency. The figures for a borough constituency would be £1,750 plus Lip per elector. The present figures, set in February 1974, are £1,075 plus 1½p per elector in a county constituency, or £1,075 plus ip per elector in a borough constituency.
It may be helpful if I relate these figures to a typical constituency of 60,000 electors. Under the Act of 1974 the total limits for a county constituency would be £1,675 and for a borough constituency £1,525. The new figures under our proposals would be £2,950 and £2,650 respectively.
As hon. Members will appreciate, the percentage increases will vary for different sizes of constituency, because we are dealing with a basic element which

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is the same for all constituencies and a variable element of 2p or 1½p per elector, which produces different sums for different sizes and types of constituency. There would obviously be other ways of arranging the increase—by giving the greater emphasis either to the basic element or to the variable element. We believe that our proposals achieve a fair balance between the needs of large and small constituencies. They also have the advantage of simplicity, which should be helpful to candidates and election agents in calculating the relevant limits in their own constituencies.
I know that there are those who argue that we should do away with the distinction between county and borough constituencies for expense limit purposes. At the same time I recognise, representing as I do a small segment of a city but a sizeable electoral population, that the greater distances generally involved in county constituencies can give rise to greater expense, and I do not think that we should abolish the distinction without a careful examination of the facts by a Speaker's Conference.
It may also be argued that no large increase is required for either county or borough constituencies since in many cases condidates do not come anywhere near their maximum. In this connection I have been looking at the figures contained in the return published in 1975 in relation to the October 1974 General Election. It is clear from that publication, as common sense would suggest, that, while in safe seats election expenditure was well within the limits, in marginal seats most candidates came very close to the maximum permitted expenditure.
In their excellent book on the British General Election of October 1974 David Butler and Dennis Kavanagh calculate that on average candidates spent 59 per cent of the permitted maximum but that in their 15 most marginal seats Conservatives reported expenditure of 95 per cent. of the maximum while for Labour it was 86 per cent. of the maximum. The Liberals are reported to have spent 93 per cent. of the maximum in their best 25 seats.
As hon. Members will know, there are very severe penalties for over-spending
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by candidates. In particular, the successful candidate runs the risk of losing his seat. In these circumstances the Government consider it right to make the increases proposed in the Bill to permit candidates to conduct a reasonable campaign without incurring the risk of exceeding the maximum permitted expenditure.
Before leaving this topic perhaps I should say a few words about some of the more general problems relating to election expenditure. Section 63 of the Representation of the People Act 1949 provides that
"No expenses shall, with a view to promoting or procuring the election of a candidate at an election, be incurred by any person other than the candidate, his election agent and persons authorised in writing by the election agent."
It has been held that the present law does not prohibit expenditure incurred on advertisements which do not support a particular candidate but are designed to support, or have the effect of supporting, a particular party generally in all constituencies. I emphasise "in all constituencies". Nor does the law prohibit expenditure having the real purpose or effect of general political propaganda even though this does incidentally assist a particular candidate. On the other hand, it has been held that expenditure in a particular constituency is covered by Section 63 even if it is merely aimed at preventing one candidate's election in a contest of more than two candidates.
I recall that my hon. Friend the Member for Litchfield and Tamworth (Mr. Grocott) was given leave in May last year to introduce his General Elections (Limitation of Expenses) Bill, which was aimed at limiting expenditure by political parties and other organisations and requiring the publication of income and expenditure of such organisations incurred in connection with General Elections. I recognise that there are difficult legal and political issues involved in this aspect of the matter. It was for this reason that the Government hoped that a conference under the Chairmanship of Mr. Speaker would be able to give the question careful scrutiny.
Such a conference would also be able to consider the question of an increase in the candidate's deposit. This was set at its present level of £150 in 1918 and clearly an increase would be justified on

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the basis of the change in the value of money since then. At the same time, we think that consideration should be given to the related questions of an alternative to the deposit as a means of discouraging frivolous candidates, and possibly a change in the level of support required to save a deposit.
Under the present provisions there can in some constituencies with a large number of candidates be a rather small margin between winning the seat and losing one's deposit. Some of these points were raised in the short debate in the House on 15th March, when my hon. and learned Friend the Member for Leicester, West (Mr. Janner) was given leave to introduce his Representation of the People (Deposits and Nominations) Bill. The Government's view remains, however, that these are topics that can best be considered by a conference under the Chairmanship of Mr. Speaker, and I hope that it will in due course prove possible to reach agreement with the official Opposition on the terms of reference for such a conference.
It is for these reasons that the proposal on this aspect of the Bill is limited to increases in the maximum permitted expenditure by candidates at parliamentary elections. I hope that I have explained that aspect sufficiently.
I turn now to the other part of the Bill, covered by Clause 2. This provides that the Secretary of State may by order vary the maximum amounts of candidates' election expenses at parliamentary elections, certain local government elections, and certain elections in the City of London, to take account of any change in the value of money. I believe that this would be a sensible procedural change. At present, it requires an Act of Parliament to make any change, however minor, in the expenses limits for parliamentary or local government lections. It is clearly right that Parliament should retain control over these limits, but it seems inappropriate to require the full legislative procedure in those cases where changes of a very limited nature are being made.
Clause 2 therefore proposes that the orde-making power should be limited to increases to take account of inflation. The orders would be subject to the affirmative resolution of both Houses and thus Parliament have the final say. We hope
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that the House will consider this a sensible arrangement, bearing in mind that any substantial change in the structure of the expenses limits, either for local government or for parliamentary elections, would still require the full legislative procedure required for an Act of Parliament.
As a result of the Government's success in the battle against inflation, we hope that the need for such orders will be less in future. It is nevertheless realistic to assume that there may continue to be a need to increase the expenses limits from time to time and this clause would enable such changes to be made in an appropriate way.
As explained in the explanatory memorandum, the present proposals will have no effect on public expenditure or on public service manpower. I recognise that there are those who consider that there should be some support for candidates and the political parties from public funds. This matter was considered in great depth by the Committee on financial aid to political parties, which reported in 1976. The Government have not yet formed a view on the Committee's recommendations, which would require legislation, and, whatever one feels about it, it is an important issue that will have to be resolved, but not tonight. I am sure that the House will agree that the topics covered by the Committee would be inappropriate for this Bill.
As I have explained, the Bill is of very limited scope. The proposed increases in maximum permitted expenditure would, however, be of considerable importance to candidates in many constituencies, and I therefore hope that the House will give the Bill a Second Reading tonight so that we can avoid what happened in February 1974—in my view, an inappropriate way, although I acknowledge that it was at short notice, to proceed with this matter.
10.14 p.m.
Mr. David Howell: We are dealing with a Bill which, although small in purpose, obviously touches on some fundamental aspects of our politics and constitution. Although the aims may seem limited, it is right that we should look carefully at what is proposed and at what lies behind it.

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Let me make clear at the start that we Conservatives support the limited purposes of the Bill. We think that it is right and appropriate that the expenses limit should be increased. We support the principle behind not merely the Bill but legislation going back to the end of the last century, legislation which has sought successively to limit the amount of candidates' election expenses which may be employed in a campaign. We have come a long way since elections were won or lost through
"torrents of beer and gin",
to use Mr. Gladstone's description.
The question is whether this is an adequate increase. The average English constituency of, say, 65,000 electors by my calculation will be entitled to about a 77 per cent. increase over October 1974 and rather more than that over February 1974. But since February 1974 this country has been through a nightmare of inflation, which has involved retail prices rising by just under 90 per cent. My calculation is that if we were to stick to the same real values as before we should need a maximum of £2,942 for a borough and £3,253 for a county.
Of course, the Bill does not raise the maxima to those levels. Therefore, in effect we are tonight deciding to reduce in real terms the actual expenditure allowed for candidates' expenses. We are pitching it at a level below that prevailing at either the February 1974 or October 1974 General Elections. That may be right or wrong, but I am not at all sure that we should necessarily let a debate on this Bill go through the House without having made clear the reasons why we wish to reduce the expenses that a candidate may have as his or her maximum in conducting the election campaign. There may be very good arguments for it, but this is a cut. We all know that between February 1974 and now not only have costs and prices soared, but they have soared in the sort of areas covered by the kind of expenses incurred by a candidate in an election.
Mr. Edward Lyons: Rather than take the general inflation rate, which includes such things as food, would not it be more reliable to concentrate on the increase in the price of printing, for example, in order to get a truer calculation?
Mr. Howell: The hon. and learned Member anticipates me. I was just about to refer to some of the items covered by our expenses when we fight elections. One example which leaps to mind is that of telephones. A lot of telephoning goes on, and usually an office requires an extra telephone to be installed. That price has increased, admittedly not by the sort of percentage I was talking about earlier. However, in February 1974 the cost of a local telephone call at peak hour was I p for three minutes. It is now 3p for two minutes. A simple piece of arithmetic will show that that is a very large increase, indeed. The same applies to postage, over and above the free postage allowed in the free mail shots, stationery, hire of premises and all the rest.
In fact, the wholesale price index has gone up by more than 90 per cent. since February 1974. I do not think that there will be any dispute that the percentages are enormous and that on the whole, if we believed it right that a certain real value should be placed on candidates' expenses in 1974, we should have indexed the figure fairly precisely. We have not done that. We have fallen short and, therefore, in this Bill the Government have proposed that the real value of expenses should be somewhat cut. That is the position.
We support the purpose of Clause 1, but there are one or two questions that I wish to raise. The first is the gap between the counties and the boroughs. This gap has closed steadily since 1946, when the borough maximum was four-fifths of the county maximum. It is now 90 per cent. of that of the county. I do not know whether this is intentional or desirable. On the whole, I would not go along with those who say that we should even out the difference altogether. The expenses of a large county area are bound to be different. One only has to look at the cost of petrol and transport for a start. We should recognise that the gap has been steadily closing and it may be that when a Speaker's Conference comes about the differentiation between counties and boroughs can be looked at again. We can then consider whether closing the gap is intentional rather than accidental.
The next matter that I want to raise concerns the new powers available to the Secretary of State. I think that I am right in saying that it is proposed that there

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should be an order by the affirmative resolution procedure. This would come before the House and the Secretary of State would then propose some increased figure. Whether it would be indexed in line with inflation I do not know. If we have to travel this path of building in automatic compensation for inflation in the belief that it does not make any difference when really it does—and it is a path I view with sorrow and dislike—the Secretary of State should explain why there is to be a further cut in the real maximum for candidate's expenses.
In 1918, when it was proposed to bring down the level of expenses very sharply to tighten up the whole pattern, it was argued out in the House. Let us not hide behind the shabby curtain of inflation in putting forward proposals which are, in effect, to change the situation. If in future this new procedure were used and the maximum were not fully indexed in line with inflation, that would change the situation. That should be made explicit and clear.
We are dealing here with just one aspect of the laws governing the use of money in election campaigns. Most of that law is of nineteenth century origin and character and is none the worse for that. Indeed, one could argue that because it is nineteenth century it is in fashion at present. But it points to the need for revision.
We are bound to ask ourselves at what point an election campaign begins. This is not precisely described in the Bill. We are bound to look at the issues raised by the conduct of referenda, the way in which by-elections are conducted, and how the whole razzamatazz of by-elections is somehow coralled and squeezed into the corset of this legislation.
This is often done in a way that may satisfy legal exactitude, but everyone knows that if we were to look clearly at it afterwards, it simply would not add up. Perhaps we need to look at these things again and perhaps it should be done through a Speakers Conference on electoral law.
I do not go along with those who say that this whole area of law needs reforming. I do not hold with the mood that says that just because legislation is old it should be changed. The truth is that when all is said and done, we
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manage to conduct our elections with some economy and restraint. We may criticise each other on various aspects and features of the way in which our central organisations spend money and run elections, but if we compare ourselves with electioneering in other countries we sec that we manage it with a procedure and economy that others envy. It would be very unwise to discard this in the cause of some frenzied reform and a belief that, because the legislation is old, it automatically needs reforming.
On that note of reaction, if I may so put it, and against the cries of those who would reform and revise everything for the sake of reform and revision, let me repeat that we support the limited aims of the Bill. We believe that these increases, although they do not fully maintain the situation that prevailed in 1974, are at least a great improvement.
10.25 p.m.
Mr. A. J. Beith: The Bill is a welcome change from the undignified procedure that we have seen in the past—rushing into last-minute changes in the rules governing election expenses on the eve of a General Election. By and large this is an acceptable way of going about the matter and we must set the precedent of handling these provisions at a reasonable point in the life of a Parliament and perhaps earlier in the life of a Parliament than this.
However, I have some doubts about the order procedure. Liberal Members pressed this point in our consultations with the Home Secretary. I should have been particularly unhappy if the order procedure had been so wide open that a Minister could use it to make major variations in election expenses on the eve of a General Election on the take-it-or-leave-it basis contained in the order procedure. It would have opened the way to a party that found itself in funds to arrange a massive increase in the permitted expenses limits—or perhaps to do the reverse, although that seemed less likely. In the former case, if a large increase were proposed, those hon. Members who felt that some increase was necessary because costs had risen so far that they could not object to any increase would be unable to amend the order. If that happened at the very last minute

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before a General Election, it would mean that the prospects of throwing out the order and of getting it brought back in an amended form would not be open to those hon. Members.
Therefore, the limitation in the Bill that links the use of the order procedure to the effects of the change in the value of money is desirable. It may seem a slightly cumbersome procedure and rests on the opinion of the Secretary of State, but it is desirable. Furthermore, it opens up the possibility that expense limits might even be reduced, if the circumstances are different from those experienced in the past few years. We pressed for such a limitation to be in the Bill, and I am glad to find our suggestion adopted.
Printing and paper costs have increased considerably. We must accept some measure of increase in the limits of candidates' expenses, but the House must be cautious on this aspect. We do not want a democracy in which money talks and in which the ability to expend the largest amount is the determining factor in the kind of election that is fought. Therefore, we must carefully examine any proposed increase. Even though in this instance there has, in effect, been a cut because the full effects of inflation have not been felt, we must remember that we are judging this legislation against the background that the limitation is based purely on the expenditure of the candidate in the constituency and not of the party as a whole. Anybody who supposes that one can draw an effective distinction between the political consequences of the money the candidate spends in distributing his election address and the political consequences of nationally financed newspaper and poster advertising campaigns in elections is deluding himself.
The party nature of elections nowadays is such that it is a nonsense to suppose that a series of advertisements in local newspapers in a marginal constituency at national expense is not part of a local candidate's election campaign. We are judging these limitations against the background that a party which, for example, can afford to spend vast sums placing advertisements in as many women's magazines as can be persuaded to add accept them is in a position to fight an
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election on a completely different footing from other parties. If the Conservative Party can do that now in the run-up to an election, what can it do in an election campaign?
We must therefore ask why in legislation of this kind we are not placing limits on the total expenditure of a party in an election campaign. If we do not do that, big money will be given the opportunity to play a large part in elections, and it will be at national level that that big money is spent. If there were no limit on expenditure at constituency level and therefore the choice of where to put the money were not governed, to some extent, by that limitation, a large part of it would still be spent in the same way as it is now—in national newspaper and poster advertising and other expensive means of adding to the party propaganda. We delude ourselves if we suppose that this element can be left out of our considerations.
We are also considering the Bill against a background of no progress having been made on the recommendations of the Houghton Report on funds for political parties which referred specifically to assistance to candidates and parties and wanted its recommendations implemented by 1st April 1977. That is some time ago.
If we are anxious to have a democracy in which it is not the ability of the well-financed sections of the community to put their money into party campaigns that counts, we must consider either being very strict in the limitations imposed on party propaganda or other ways of financing political parties. What sort of democracy do we want? Do we want one in which it is big money that makes the difference in elections, or one in which, by one means or another, we ensure that the opportunity to present a case to the electorate is broadly the same for all the parties that seek to do so?
Democracy is not served if too great an opportunity is given to big money and that is the danger that we face if we put all the limitations on expenditure at constituency level, as is done in the Bill, and put none on the ability of parties with really big money—and there is only one party in this country with really big money—to do what they wish with that money at national level. We shall be

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making a great mistake if we do not look at this matter from both points of view.
10.32 p.m.
Mr. J. W. Rooker: When my right hon. Friend the Home Secretary started reeling off the percentages of the maximum that various candidates had spent, I was not sure whether he was going to list them in the order of those who came closest to spending the maximum. I have just done a small sum and found that my expenses in the last General Election campaign were 99·59 per cent. of the maximum—just £7 short of £1,470. We manage things very well in Perry Barr. We are a marginal constituency. We sought to spend the maximum possible and we achieved a successful result, though I do not know where we shall get the money to fight the next campaign on the basis of 99 per cent. of allowable expenses. Like most other Labour constituencies, we are not backed by hundreds of thousands of pounds from City and business institutions, and the trade union coffers are not exactly overflowing.
It is significant that both my right hon. Friend and the hon. Member for Berwick-upon-Tweed (Mr. Beith) referred to the problem of expenditure outside that of the individual candidate. It is also significant that the hon. Member for Guildford (Mr. Howell) did not refer to this important change which has taken place in electoral practice in recent years. The hon. Member for Berwick-upon-Tweed said that there was only one party in this country that could mount an all-out campaign with money being no object and he was certainly not talking about the Liberal Party or the Labour Party.
When. I came to the House today, I saw something on the corner of Parliament Square that caused me to raise a point of order with Mr. Speaker at 3.30 p.m. Political propaganda of a party nature was attached to the railings of this building. I did not mention the name of the organisation when I raised the point of order because, bearing in mind the time at which I raised the matter, I did not want to give the organisation free publicity. I have done some homework since then, because the matter is relevant to this Bill.
The organisation was the Campaign Against Building Industry Nationalisation
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—CABIN. The first point to make is that it is not Labour Party policy to nationalise the building industry as such and the campaign is therefore misconceived. Mr. Speaker made sure that that party political propaganda was removed from the railings.
When my right hon. Friend introduced the Bill he mentioned the problem of national expenditure outside individual constituencies by the parties and, more important, by organisations outside the political parties. My right hon. Friend rightly pointed out that under Section 63 of the Representation of the People Act no expenditure outside the candidate's own expenditure may be spent for a particular candidate. The only allowable expenditure is that spent by the candidate or with his approval. My right hon. Friend made the point that any such expenditure has to be of a national character: it must go all over the country.
The hon. Member for Berwick-upon-Tweed rightly takes exception to this, and so do I, but it is not the main point of my argument. Such expenditure is here with us already on the part of the pressure groups outside this House, representing all types of issues. Money is expended during a General Election. The groups get an airing for their views and try to put pressure on the candidates. This is legitimate to an extent, but I should like to see it controlled.
What is illegitimate and must he illegal is the spending of money by organisations in particular constituencies in order to sway the result one way or the other for a particular party. But I am not talking now about political parties. I am talking about organisations that spend money in a constituency in order to influence the result, and where the money is not recorded in the election expenses of the candidate on whose behalf the money is actually spent.
I have only one example that I want to give. The organisation to which I referred earlier, CABIN, stated in The Times of 19th June 1978 that it had set itself up. Sir Maurice Laing, who is the chairman of John Laing, said that CABIN would use all the resources at its command to alert the public about the threat, as it sees it, to the building industry. He said that money was no object,

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but that it would take a lot, with estimates of £300,000 for this year.
It is all right if the organisation wants to put advertising in the local Press in every constituency in the country, with leafleting and so on saying "This is the Labour Party policy", even though I think they have it wrong. It is fair enough to do it in every constituency. This can be done. It is money that the Tory Party will not have to record in its election expenses. Nevertheless, within the law it can be done.
What must be objectionable is the statement in the same article in The Times that 300,000 balloons will be released and the reference to
"space taken in local and national newspapers and intensive campaigns conducted in about 100 constitencies where it is judged that the issue could tip the electoral balance".
That flies totally against the concept of limiting candidates' election expenses. For an organisation to use money from shareholders, from profits—in the case of George Wimpey, profits on which no tax was paid, as I pointed out on several occasions in the House—and to spend it in 100 constituencies, selected by their marginality, directly to attack the Labour candidate and the Labour Party can only be of direct benefit to the Tory Party. That is what is meant by
"where it is judged that the issue could tip the electoral balance".
This must be illegal, and I want the Home Secretary to allude to this. If he cannot do so tonight, I ask him to have a word with his right hon. Friend the Attorney-General and with the Director of Public Prosecutions about a possible charge against these building companies of conspiracy to get round the Representation of the People Act 1949, because that is what is happening here.
In no way can this expenditure be properly accounted for. The Tory Party will be the direct beneficiary. It will not of course, complain about it. It wants the electoral system to be rigged so that money can buy votes, as the hon. Member for Berwick-upon-Tweed pointed out, because that is the one way in which the Tory party knows it can win. It will have unlimited resources if the need arises.
The Tory Party will be acquiescing in a campaign organised by these public relations companies on behalf of the build-
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ing companies. I think that the campaign is being run from a private house in Mayfair and the organisers are seeking to lobby Labour Members. I shall go to the meeting called by the organisation later in the week. I shall not be convinced one iota by the campaign but I shall listen to what the organisers have to say and see what sort of propaganda they are putting out. I hope that I shall get a few answers to the questions that I have raised tonight about the illegality of this form of campaign.
Mr. Ivan Lawrence: What does the hon. Gentleman say about the expenses that might be incurred by trade unions working for the return of a Labour Government?
Mr. Rooker: The question is not sufficiently specific for me to answer. The trade unions operate nationally. They do not go into individual constituencies and conduct a campaign in selected areas. Trade unions officials working in election campaigns cannot be paid and they cannot hire canvassers. The money spent is registered in the returns. Such involvement is different from that proposed by CABIN, because it is national. If CABIN ran a campaign in 365 constituencies, it would be within the law. But conducting a campaign in 100 selected seats where it thinks it can tip the balance it is operating as a secondary Conservative Party.
CABIN's expenditure will not be made public. I shall be able to ask the returning officer to allow me to look at the amount spent in my constituency. After tonight I shall represent one of those marginal constituencies. We are prepared to take them, but only if everyone operates under the same rules. CABIN can look at my expenses. I want to be able to look at its expenses. I want to be able to examine all the money that is spent on behalf of my Conservative opponent.
Mr. John Evans: Is my hon. Friend aware that any expenditue by a trade union is limited to the amount in its political fund? Is he aware that about 200 candidates at the next General Election will be sponsored by the trade union movement and that each of them will have to declare every penny spent on his behalf by a trade union? That is the requirement of the Representation of the

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People Act and it has been the practice for many years.
Mr. Rooker: My hon. Friend is right. He argued the case better than I did. Trade union expenditure is known. A company S and U Stores, owned by the former Member for Birmingham, Yardley, Mr. Derek Coombs—who lost his seat in February 1974, I am glad to say—and his father is being investigated by the Office of Fair Trading for breaking financial loan laws. Mr. Coombs used his employees to campaign for him and did not declare that in his election expenses. Because it is too late, the police will not prosecute. This is accepted and public knowledge in the West Midlands.
It is another example of a Tory Member with big business to back him up using his employees in an election campaign. One of the employees confessed that he would not vote Tory but the boss told him to get out in his car for a couple of weeks and do what he was paid to do. It took four years to find out about that, because correct election expenses were not returned.
We want to kill the CABIN issue before it gets off the ground. I hope that this short debate will do that.
10.43 p.m.
Mr. Roger Sims: I am disappointed at the relatively narrow way in which the Bill is drawn. The Bill seeks to take into account the effect of inflation on candidates' election expenses, but it does not deal with the other expenses that are covered in the Act.
One expense is dealt with in Section 62 of the 1949 Act and limits to £100 the personal expenses which a candidate may pay himself. This might be of academic interest because some candidates would not contribute that amount but some might be willing and able to do so. In 1949 £100 was considered to be a reasonable limit. If £100 was a reasonable figure in 1949 a substantially higher sum would be reasonable today.
I turn to the question of the work done by our election agents, to whom all hon. Members owe so much. During and after an election the agent compiles a detailed return of all election expenses which are lodged at the local town hall, in accordance with the Representation of the People Act 1949, which this Bill seeks to amend.
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As hon. Members know, virtually every expenditure has to be accounted for. Section 61 of the Act provides that
"Every payment made by an election agent in respect of any election expenses shall, except where less than forty shillings, be vouched for by a bill stating the particulars and by a receipt."
That is still the law—that for expenditure on anything more than £2 the agent has to obtain a written account and a signed receipt and attach it to his return of election expenses.
In 1949, it was obviously considered that anything less than £2 was so trivial that it need not be detailed individually. That being so, a more realistic figure now should be inserted in the present Bill or some other legislation so as to relieve agents of some of the burden of work in making their returns. Many small expenses are involved in election procedures. Nowadays, when receipts are relatively rarely given, it seems unnecessary that an agent should have to ask for a detailed account and receipt for every expense of £2 or more. I am disappointed that there is nothing in the Bill to take that into account.
I raised this matter when a similar Bill was before the House in March 1977, and I had hoped that the Home Office would take the point and do something about it at that stage. Unfortunately, even if the proceedings on the Bill had not been so rapid as they have been, precluding me from seeking to table an amendment, I suspect that I should have been ruled out of order by the terms of the Long Title if I had prepared an amendment.
I think it unfortunate that the Home Office did not feel able to take steps to meet those two relatively small points. I had hoped that it would be possible, even in the limited time available, to produce a short Bill to cover them. I am sure that it would be passed rapidly by the House, as, I trust, the present Bill will be tonight.
10.48 p.m.
Mr. Edward Lyons: The ability of many Labour Party constituency organisations to raise money has not perceptibly increased since the last General Election. Although the increases envisaged in the Bill are based on the rise in printing costs and so on, many constituency organisations have no hope of raising the £2,800 which is likely

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to be the new average. There are 400 Labour candidates who are not union-sponsored and, in my view, the great bulk of them will not be able to raise the maximum envisaged in the Bill.
That means that the great advantage given by the Bill must lie with the Conservative Party rather than with the Liberal and Labour Parties. This is an indication of the present Government's fairness. In spite of the advantage going to the Conservative Party, they are none the less introducing the Bill. As long as that is clearly understood, the Bill can go through.
This is being done as an act of democratic fairness, but in the Bradford area, for example, or in Yorkshire generally, I can think of hardly any non-sponsored Labour candidate whose party will be able to raise the maximum under the Bill, whereas every Conservative candidate will have no difficulty in raising the maximum. There is thus an additional advantage to the Conservatives, but they will not win all the same.
10.49 p.m.
Mr. Michael Shersby: I intervene for only about 30 seconds to say that the speech to which I have just listened from the hon. and learned Member for Bradford, West (Mr. Lyons) really was utter rubbish. As one Conservative candidate at the next General Election, I can tell him that in my parliamentary constituency I shall have great difficulty in raising the kind of money that is provided for in the Bill. That will not stop me from trying hard to do so. But it is rubbish to try to pretend that Labour Members will not be able to raise funds from their supporters whereas the Tories will. It is time that the hon. and learned Gentleman's party woke up and got cracking on its supporters. We shall do so. If one has a good case to support, people will give their support. I support the Bill.
10.50 p.m.
Mr Merlyn Rees: The Bill is about only one aspect of the matter of expenses. The hon. Member for Chislehurst (Mr. Sims) hoped that other matters would be in the Bill. I was at the Home Office in the 1960s and I am now there again. In my view, it is most important that these matters should be discussed
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at a Speaker's Conference. I hoped that in the past year, when there has not been agreement on one major aspect of the matter, these matters could have been discussed. What I have tried to do is to discuss the matter with all the parties, since 5th April, which is a second-best, but the best available, because we were dealing with only one issue.
There are other matters in regard to candidates' expenses. There is a matter which I think needs urgent discussion, namely, by-elections. We have not dealt with the wider issues.
The hon. Member for Berwick-upon-Tweed (Mr. Beith) talked about big money. We have had an example of that in elections within the past 15 years. We are in the age of the advertising agency, of voice training, and things of that kind—which Mr. Gladstone, Mr. Disraeli and others did not need. In the twentieth century, presentation and that kind of thing matter. There is the role of public opinion polls. Vast sums of money are involved. There is a problem about the large sums of money.
I say to the hon. Member for Uxbridge (Mr. Shersby) that it is not so much the money spent in the constituency that matters; it is the money spent outside the constituency, and the individual campaign of a Member that is important. The Burton constituency used to get a lot of mention in the nineteenth century with regard to election expenses. I believe that the brewers played a big part at that time. When Mr. Gladstone referred to gin—I have not looked up the quotation—I imagine that he had Burton on his mind.
The hon. Member for Burton (Mr. Lawrence) did not believe my hon. Friend the Member for Newton (Mr. Evans). I am not a sponsored Member, but I get £100 from the National Union of General and Municipal Workers. I pay it straight into my party. In Leeds we can believe anything about Bradford. But in Leeds we raise the money by holding jumble sales and activities of that kind. That is the way that most parties operate. Any posters which the Labour Party outside the constituency happens to put in my area have to be accounted for by me on my election expenses.
The hon. Member for Berwick-upon-Tweed is right; vast sums of money are

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involved. I shall come briefly to the point about CABIN from Mayfair. The only representations that I have had about Mayfair since becoming Home Secretary were from a Conservative delegation who came to see me about houses of ill fame in Mayfair. Perhaps this CABIN in the sky is one of those.
Briefly—because we have covered the ground—what the Government have done is, on one issue, to try to deal, on the narrow point, with the sums of money that are involved, the basic sum plus the extra differing sum in a rural and an urban constituency. As I argued earlier, I think that the proposals are about right. I have consulted all the parties. It would have been better had it been done through a Speaker's Conference, but I have done the best I can since 5th April. What I propose today is the result of the consultations.
The hon. Member for Guildford (Mr. Howell) talked about the gap between the counties and the boroughs. That is another matter. What I am doing now on behalf of the Government is carrying on the trend that has come out of Speaker's Conferences in recent years. This matter ought to be discussed at a Speaker's Conference.
With regard to the new powers, there is no automaticity on this matter, as the hon. Member for Guildford put it. We do not have to come forward again, perhaps in the middle of next year before the election of September 1979, with an order. We would have to consult before doing so. There is no changed method here, as the hon. Member for Berwick-upon-Tweed noticed. Indeed, we took into account some of the views put by the hon. Member and other parties on this very point. However, I believe that the most serious cases of unregistered voters arise in service areas—the towns where a large number of residents are in the armed forces—residents who also have their families. I shall not go into the detailed reasons for this more than I need. I am conscious of the rules of order. It is a limited method of tackling the problem. We are dealing only with the precise point of the expenses. We are not dealing with changed methods.
My hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) raised the question of the organisation known as CABIN. As he was good
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enough to inform my office that he intended to raise the question, I obtained a copy of the advertisement from The Times. It says that 300,000 balloons will be released. I hope that some will be released over my constituency. I would welcome anything that would improve the atmosphere at that time in my constituency. I do not know what message will be on the balloons, but it seems from what I read here that the organisation has it wrong before it starts. It is fighting a campaign against something that is not going to happen, but it is following a very good Conservative tradition in doing that.
The organisation intends to run, in 100 constituencies, a campaign on the nationalisation of the building industries. It would be for the courts to decide, if a prosecution were to be brought, whether there had been a breach of the law. I can do no more than repeat what I said earlier; it is one thing to do that in the country as a whole but, if the organisation wishes to act in that way in selected constituencies, I suggest that it spends some of the vast sums of money that it has on consulting a lawyer before proceeding further. I do not think I should say any more about that, because a matter of fact is involved that would have to be decided in a court of law.
These proposals are modest. I think that they are right. I wish that there had been a Speaker's Conference, but there has not been. I have consulted. I hope that the Bill will be accorded a Second Reading.
Question put and agreed to.
Bill accordingly read a Second time.
Bill committed to a Committee of the whole House.—[Mr. Bates.]
Bill immediately considered in Committee.
[Sir MYER GALPERN in the Chair]
Clauses 1 to 4 ordered to stand part of the Bill.

REPRESENTATION OF THE PEOPLE BILL
  New Clause No. 1

    ADDITIONAL EXPENSES FOR UNREGISTERED PERSONS
    (1) The Secretary of State may, where he is satisfied that there exists in any constituency

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    a substantial number of persons eligible for registration as electors but not so registered, order that an appropriate number of persons shall be deemed to be entered in the register of electors for the purposes of section 64(2)(a) of the Representation of the People Act 1949; and the overall limit on candidates' election expenses shall be increased accordingly.
    (2) An Order under subsection (1) above shall not be made unless a draft of the Order has been laid before, and, approved by resolution of, each House of Parliament.'—[Mr. Viggers.]
    Brought up, and read the First time.
    Mr. Peter Viggers: I beg to move, That the clause be read a Second time.
    The purpose of the clause is to recognise the large number of persons unregistered for voting and to allow expenses in respect of them. The clause is of narrow application. I can say that because the figures of population as against the numbers registered for voting are available. The whole population above the age of 18 in June 1976 amounted to 35,627,500, whereas the number of electors on the 1977 electoral register is 35,653,771. I recognise that we are not comparing like with like: there is a discrepancy between the two figures of only 0·1 per cent, or 1 in 1,000.
    When I say that the clause is of narrow application I do not mean that it is unimportant. Where there is a discrepancy between the total number of adults in a constituency and the total number of persons registered for voting, it can be a large discrepancy.
    The first is Kensington and Chelsea, which comprises two constituencies. The population over the age of 18 in 1976 amounted to 138,965, whereas the electorate on the 1977 electoral register amounted to 117,746—a discrepancy of 21,219, this meaning that about 15 per cent. of the adults in those two constituencies were not registered for voting purposes.
    There are many reasons why those living in that area of Kensington and Chelsea may not be registered. This is an area where many people live in flats. Many young adults will be registered in their original constituency, where their parents live. Also, there are people of foreign origin who may not wish to be registered here, and, of course, there are some residents who have two houses and may be registered elsewhere.
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    A similar pattern, though perhaps for different reasons, arises in the London borough of Camden, where the three constituencies of Hampstead, Holborn and St. Pancras, South and St. Pancras, North produce the following figures: the population above the age of 18 in June 1976 amounted to 156,629, and the electoral register for 1977 showed 143,037, which means that the number of unregistered adults amounted almost to 10 per cent.
    However, I believe that the most serious cases of unregistered voters arise in service areas—the towns where a large number of residents are in the armed forces —residents who also have their families. I shall not go into the detailed reasons for this more than I need. I am conscious of the rules of order. The subject was the basis of an Adjournment debate on 2nd February of this year, and the facts are well known to Ministers at the Home Office, but to make sense of my argument I must give the bare bones of the background.
    The Representation of the People (Armed Forces) Act 1976, which was introduced by my hon. Friend the Member for Woking (Mr. Onslow), had the admirable purpose of making electoral registration easier for service men and their wives. It allowed service men and their wives to register once as service voters and then to remain as service voters throughout the period of the husband's service career, with the commensurate privileges of proxy and postal voting.
    So far, so good, but the Act went further and provided that service men and their wives not only can but must register as service voters, failing which they lose their right to be registered at all. Many wives were incensed by this, and the issue became a cause célèbre in service areas. Many wives remonstrated and said that they were being treated as part and parcel of their husbands—as a kind of bag and baggage—and maintained that they were persons, not service persons. They objected violently and therefore did not register as service personnel. Indeed, the issue was so serious that I called for an emergency debate in the House on the problems of non-registration of wives of service men.
    Now that the registers have been completed in service areas we can see the effect of the Bill for the first time. The

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    only constituency that I can speak of with real knowledge is my own. In my constituency of Gosport there are about 49,000 people on the electoral register, and it is now estimated that about 10,000 adults have not registered although they are eligible to do so. It is believed that most of these are wives of service men who object to registering as service voters. This means that one in six of the adults in my constituency is not on the register. The Minister knows my views on this, and to repeat them further would be out of order.
    But there is an effect on the maximum amount of expenses that can be employed in these constituencies where there is a shortfall in the number of registered adults To take a constituency of 60,000 in a borough, it would mean that there is the basic £1,750, plus 1½ on the 60,000, making a total of £2,650, whereas with 50,000 people in a borough the total would be £2,500, which means that there is a shortfall of £150 in the amount of expenses that are allowed. It means, in fact that instead of campaigning as if one were campaigning for 60,000 people one is campaigning as if one were doing it for 50,000 people.
    One may say that that is not a particularly large shortfall, that it is only 5 per cent., and what is £150 anyway, but as the hon. Member for Birmingham, Perry Barr (Mr. Rooker) well knows—and I do too,—it is necessary to use the whole of one's expenses if one is mounting a serious campaign.
    Mr. Rooker: It is necessary to use the whole of one's expenses to get votes. If people are not on the register they cannot vote. I do not see the purpose of the new clause.
    Mr. Viggers: The hon. Gentleman will see the purpose very shortly. Some of the expenses in an election are fixed. For example, there are the cost of hire of halls, telephone expenses and the cost of an election address when it is sent to registered voters. But many of the expenses are not fixed. Many vary. The cost of printing leaflets for general distribution, lapel stickers, car stickers and window posters is the largest single item in any campaign, and most printing is done not on the basis of the number of people who are registered as electors but on the number of people in the constituency.
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    When leaflets are printed for distribution, they are normally not dropped carefully through the doors of people who are registered on the electoral register but are dropped through every door. Similarly, when a street distribution is made of leaflets or car stickers, it is made to all people in the street rather than on the basis of a cross-examination of the people as to whether they are on the electoral register.
    Mr. John Evans: The hon. Gentleman is mystifying me. Surely, one knows the number of electors that one has only from the electoral register. The hon. Gentleman is suggesting that there is a mythical gross total including people who are not on the register. Where does he obtain these figures? The only relevant numbers on which any candidate can base his campaign expenses are the numbers of those who are actually on the register.
    Mr. Viggers: I tried very hard, I hope successfully, to stay within the rules of order. For that reason I may perhaps have skated over some of the finer points, which would explain the argument to the hon. Gentleman.
    The First Deputy Chairman (Sir Myer Galpern): I appreciate the difficulties. I have three cemeteries in my constituency.
    Mr. Viggers: I am grateful to you, Sir Myer, for that intervention, which was most helpful, as always. The residents of your three cemeteries, I suggest, do not drive cars that might require car stickers, do not parade around the streets, with the possibility of being given literature, and do not live in houses, and therefore are not the recipients of printed literature.
    The fact is that it is known and can be established that there are 60,000 people over the age of 18 living in my constituency, and only 50,000 of them are on the electoral register. I ask the hon. Member for Newton (Mr. Evans) to take that as read. I can assure him that it is true. I trust that he and his hon. Friend the Member for Perry Barr appreciates the point I am making is in no sense a party political point. It is a genuine point, and I maintain that it is worthy of consideration.
    Mr. Edward Lyons: I congratulate the hon. Gentleman on what appears to me to

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    be a remarkably altruistic attempt to ingratiate himself with all those who cannot vote for him, but is it not the case that the amount of money expended on leafleting through doors—that is, excluding the free post—must be very small, even to the percentage of people the hon. Gentleman is talking about, so we are talking about only very tiny sums?
    Mr. Viggers: I accept that we are talking about comparatively small amounts, but they are significant, and equity demands that there should be some recognition of not just the number of people on the electoral register but the number of people who are within the constituency.
    I do not believe that the average candidate when campaigning asks each person to whom he speaks, each person to whom he distributes literature, whether he or she is on the electoral register. He gives people material whether or not they are on the register.
    It is wrong that candidates in constituencies such as those I have named should be allowed the amount of money for nine people when they must aim at 10, or that in the extreme case which I have quoted, and of which I have special knowledge, they are speaking to six people and have only the maximum expenditure appropriate for five.
    The clause is of narrow application, but that does not diminish the importance of the principle that it maintains. All I ask is that the Secretary of State be empowered, if he thinks it appropriate, to take cognisance of the shortcomings in the registration in the electoral roll by deeming an appropriate number of persons to be entered in the register. This would have the effect of increasing the maximum expenditure, but would have no effect on the electoral register itself. I hope that the clause will be regarded as fine tuning, the purpose of which is to ensure equity in a small number of cases.
    Mr. Rooker: When I read this new clause I thought that the hon. Member for Gosport (Mr. Viggers) was trying to do something about people who had been missed off the register. I thought that he was trying to get them put back. I have a case in my constituency in which the electoral officer is obtaining a writ of mandamus to place on the register a total
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    of 70 people—soon I hope, because time is important.
    Mr. James Molyneaux: For all the hon. Member knows he may have another year.
    Mr. Rooker: That is so, but the principle which the hon. Member brings to the Committee tonight is extremely dangerous. If extended, if the hon. Member wins his case, next year or some other time, a candidate could come along and say "I'm getting expenses for these people. What about votes from them? Why cannot we have a situation whereby they turn up at the polling station and say 'I'm not actually registered but I live in this constituency and all the candidates have spent money on my behalf. Therefore I feel that I ought to vote.'?"
    I do not know much about the point raised by the hon. Member concerning the service voter. It is a narrow point, but the clause goes much wider. To talk about Kensington and Chelsea when people could be registered in another part of the country leaves our election law open to much greater abuse than the sort of abuse I drew to the attention of hon. Member earlier. I hope that my right hon. Friend will throw this out.
    Mr. Merlyn Rees: The remarks made by my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker), both now and earlier, sum up my view about this new clause. There is a problem of under-registration in different parts of the country. This concerns a high proportion of those in the 16½ to 18 age group and the immigrant population. Further, some electoral registration officers are more successful than others in obtaining maximum registration.
    The current method of registering service wives was brought about as a result of the introduction of a Private Member's Bill, introduced by a Tory Member. Now the Tories are complaining that it does not work. It may be that such a Bill is not the appropriate way to proceed with these matters, although I concede that in this instance Mr. Speaker's Conference had considered the matter. While there may be problems with under-registration and with service wives, the difficulty seems to involve more than this. This should have been thought of when the Private Member's

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    Bill was introduced. Many service wives do not want to be treated as appendages of the services and prefer to make their own arrangements. There is nothing that can be done about that before 16th February of next year, until which time the current register will be used.
    The hon. Gentleman suggests that I should make an estimate of the amount of under-registration in an area. It is being suggested, in other spheres, that I should say when a march should be banned and I reply that it must be done by someone with an objective knowledge of public order because I would be making a subjective judgment. Even if I were to do what the hon. Gentleman suggests the people concerned would not be able to vote anyway. This is a misconceived idea. It is not the way to tackle the issue. I believe that, on the wider subject, we ought to leave things for a while. There is a register, and if there is a General Election before 16th February of next year it is that register on which the election will be fought. I do not propose to do anything about it. I recommend to the Committee that the new clause should not be approved.
    Question put and negatived.
    Bill reported, without amendment.
    Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.
    Bill accordingly read the Third time and passed.

THEFT BILL [LORDS]
As amended (in tile Standing Committee), considered.
Motion made, and Question proposed, That the Bill be now read the Third time.
11.15 p.m.
Mr. Ivan Lawrence: I want to make two points which have caused me some concern as the Bill has passed through this House. I am still not convinced that it is all that wise to deal with the offence of deception when the law governing the two most common forms of deception—cheque frauds and
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frauds with bank cards—is still under review by the Law Commission.
The Law Commission will have to be careful not to get into a muddle, especially since clause 2(3) makes payment by cheque an offence when it is clear that the Criminal Law Revision Committee report shows that it does not think that the criminal law should punish generally for cheque offences. It looks as if there could be some conflict there.
My second point I have made often and strongly, and I will not repeat it in the form that I have done so before. It is that the idea of reforming the law of theft should not just be a way of making the law comprehensible to judges. It should also, and predominantly be, a way of making the law simple for jurymen to consider. Clause 2 as it stands, although it is an improvement, is still, in my view, far too complex and will be very difficult to explain to a jury.
I made an attempt to simplify it in Committee, and the Minister of State was kind enough to send me a letter commenting upon that simplification and pointing out that there could be faults in it. I am grateful to him for his letter. As a result of it, I hope that he, or, if not he, the House of Lords, will consider sympathetically a simplification of the clause, which would thereby merely state that
"a person who by any deception dishonestly and with intent to make permanent default causes his or another legally enforceable payment to be reduced, delayed or avoided, shall be guilty of an offence."
Then we should include another half subsection in relation to the definition of liability in relation to compensation. By that redefinition of the clause, we would reduce 206 words to 57.
I am still not saying that it would be perfect redrifting of clause 2, but it would be a lot better than some we have seen, and I think that it merits consideration. I should be grateful if the Minister would give an assurance that he will look at it again. I have handed him a copy of what I suggest, with one or two comments, and perhaps the House of Lords would also look at it again.
I repeat: it is all very well to simplify the other branches of the law and then seem to go out of our way to make complicated the law of deception. I think

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that it can be simply written so that it can be put to jurymen in a way that they can understand, and so that we can, by that means, effect an aim of our criminal law —that is, effectively to bring to justice those who offend against the rules. I hope that some of my remarks tonight and in Committee will be looked at again before the Bill becomes law.
11.20 p.m.
Mr. Ian Percival: I usually find myself in agreement with my hon. Friend the Member for Burton (Mr. Lawrence), but I do not do so on this occasion. It is tempting, when one aspect of what one is doing is still under review by another body, to put off what one is doing until further consideration, but I think that we want to keep on with this.
What we are doing is getting rid of section 16(2) of the present Theft Act, which has been described as a "legal nightmare". The law will be better for it having been removed from the statute book. By common consent, clause 1 of this new Bill is an improvement, although there has been some discussion from my hon. Friend the Member for Burton about clause 2.
I express the hope that the other place will find our amendments to its measure acceptable, so that this Bill can be passed into law as speedily as possible and so that we may make sure that it passes into law before other events take place, which we Conservatives hope will happen speedily.
Of course, if there is some way of simplifying clause 2 without detracting from it, or if there is any reason to believe that some parts of the clause are abstruse, despite what I have said one would hope that the other place will take the opportunity of putting it right, so long as it can be done within the time scale available for the completing of this Bill.
My hon. Friend has read his proposed new clause and was kind enough to supply me with a copy. There are some demonstrable gaps in it. I shall not take time to refer to them now, because my main purpose is to express the hope that there will be no further delays in this measure and, in particular, that the changes we have made will prove acceptable to the other place.
11.21 p.m.
The Minister of State for the Home Department (Mr. Brymnor John): With the leave of the House, Mr. Deputy Speaker, I want first to thank the Committee for the way in which it helped in the passage of the Bill. I also thank the CLRC, under both its chairmen, Lord Edmund-Davies and Lord Justice Lawton, for the work which it has put in.
I shall look at the new draft of clause 2 as proposed by the hon. Member for Burton (Mr. Lawrence), but undertaking to look does not mean an undertaking to agree. He and I will correspond in the usual way in that regard.
The hon. Gentleman also mentioned that the question of conspiracies to cheat and defraud is still being considered by the Law Commission. He will know that the Criminal Law Revision Committee checked this very point with the Law Commission before it started its work on this particular matter. The Law Commission expressed itself as satisfied that we should legislate on this matter in advance of the other. That being so, I see no inhibition on our doing so. Like the hon. and learned Member for Southport (Mr. Percival), I believe that the law will be a great deal better than it has been in the past for both judges and the lay public. It will take some of the lottery out of trials on this most complicated of all subjects. For that reason I hope that the other place will see fit to agree with the amendments that we have now inserted.
Question put and agreed to.
Bill accordingly read the Third time and passed, with amendments.

EDUCATION (SCOTLAND)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Bates.]
11.23 p.m.
Mr. Jim Craigen: The subject of tonight's debate has proved more timely than I had thought, because at the end of last week the Scottish Education Department presented its annual report for 1977 to the Secretary of State for Scotland. These annual reports seem to be getting thinner each year. This year's annual report seems

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to be little more than a bibliography of departmental circulars.
However, tonight I should like to press the Minister to outline what the role of the Scottish Education Department is in four broad areas of educational policy in Scotland. The first concerns teaching resources, particularly the vexed issue of composite classes. I read in the annual report that:
"A recent feature of school organisation in some areas has been an increase in the number of composite classes containing pupils of more than one age group in schools where such classes have not been traditional."
I hope that the Minister will give some more information than that available in the SED report about the extent to which we now have composite classes in many urban areas in Scotland.
I am aware that sheer geography has made composite classes a fact of life in many areas in rural Scotland as an alternative to travelling long distances or to the prospect of youngsters having to live away from home, but there is growing concern in many city areas about the prevalence of composite classes. In Glasgow in the session that has just ended, there were 514 composite classes in our primary schools. Of these 159 were under-25-pupil classes, and the other 355 were over the limit.
We must acknowledge that the national teacher-pupil ratios are better than they have ever been. This is largely the result of improved teacher supply, and a marked decline in the school rolls. Yet the Minister will be aware of the resolution passed at the annual general meeting of the Educational Institute of Scotland, which is the largest of the various teaching organisations in Scotland. The EIS resolution said:
"Members should be advised to refuse to teach composite classes containing more than 25 pupils as from the start of the session 1978/79."
What is the Scottish Education Department doing to avoid Scottish education being plunged, this winter, into discontent and disruption? Local education authorities are having to steer between circular 819 and the Red Book staffing standards as laid down by the Department, and the requirements of contract.
The Minister will be aware of the great concern that would flow from the refusal of teachers to take classes of more than
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25 pupils. It seems strange that there should be a growth in the number of composite clases at a time when there are questions about whether it is educationally necessary, in the light of the current teacher supply situation. Moreover, the surplus of young teachers from the colleges and universities is not being absorbed by the job creation programme, or by local authority recruitment. The resources are there if we care to make use of them.
The second matter of concern about teaching resources relates to educational priority areas. I pay tribute to the work of the Minister in trying to obtain additional teaching resources in areas of urban deprivation. I am aware of the additional 84 teachers obtained in Glasgow through the urban aid programme, and the additional teachers obtained in Strathclyde and four other regions, as a result of circular 991 last September. However, there seemed to be a fair amount of delay in implementing that scheme. One suspected that there was a fair amount of—dare I say it?—"red tape" coming from St. Andrews House.
The Minister may recall that at the beginning of last year I wrote to him about the possibility of a number of areas becoming educational priority areas so that additional teaching resources could be put into them. The Minister replied to me on 22nd February last year that he was anxious to avoid any formal designation because stigma could arise in certain areas. However, he pointed out that there had been one experiment in Scotland and three in England in educational priority areas.
I gathered that the one in Scotland was the Dundee study, the report of the research project sponsored by the Scottish Education Department and Social Research Council. However, it seemed to be fairly inconclusive about the extent to which such extra assistance succeeds.
Nevertheless, as I have told the Minister privately, recently I have seen some assessments which secondary schools have been making of the primary school intake for next session. It is somewhat disturbing to see figures showing that a fairly high proportion of youngsters of 11 or 12 will enter secondary schools next session with reading ages of 8, 9 or 10. There may be arguments among educationists about the test methods used, but

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the fact remains that there is a problem. Although we are prepared to employ remedial teachers at secondary school level, I suggest that there is an urgent need to improve the supply of remedial teachers in the primary schools, otherwise the position will be upside down. Because we shall not be helping youngsters while they are still in the primary school, we shall wait until they go into the secondary schools and become caught up in the problems of transition and a much wider curriculum. The fact that we recently had to launch an adult literacy programme is evidence of the extent to which we are not quite catching up on the problems in either the primary or secondary schools.
The Minister is aware that the job creation programme has come to an end and that neither the youth opportunities programme nor the special temporary employment arrangement helps those young teachers who hitherto had been absorbed in essentially non-teaching employment. Frankly, I could not care what mechanism is used, whether it be urban aid or the provisions of circular 991, but I should like to think that the Minister and his Department are currently examining ways to step up the numbers of teachers who might be available for those areas of urban deprivation.
Employers are concerned about the reading and numeracy ability of many youngsters. Therefore, this is a crucial area.
An article in the Glasgow Herald on 24th June pointed out that between November 1975 and December 1977 3,303 qualified students were able to make use of the job creation programme in 272 projects. These exercises cost more than £3·3 million. I suggest that it would often be easier to get value for money if we put such amounts into the education budget rather than into alternative means of taking on teaching staff.
A series of educational initiatives have been taken in the past few years. I remember taking up with the Minister's predecessor the possibility of setting up a Royal Commission to consider various aspects of education in Scotland. At that time I was told that the SED had just set up the Pack committee to inquire into truancy and indiscipline in schools in Scotland. I was amazed that there was
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no primary school teacher among the membership of that committee. We also had the Dunning committee, to review examination assessments in the third and fourth years of education and the Munn committee, to consider the content of third and fourth year curricula.
Scottish education has had to swallow a series of reports in the past year or two, but all three reports have been published for nearly a year and so far we have had no clear indication of the Department's thinking on them.
The Minister knows my views about changing the examination system. I question whether the Department would be prepared to grant the considerable finances that might be necessary to meet the cost of a fundamental upheaval in our examination system—quite apart from the difficulties that would arise for teachers, employers, pupils and parents in getting accustomed to the new system.
I do not want to dwell too long on the three reports, but the prevalence of truancy in many of our schools is serious. I hope that the Minister will comment on the problem of absenteeism and on the prevalence of absenteeism among teachers. Earlier this year, many of my colleagues and I were presented with an interesting document from the Educational Institute for Scotland entitled "Stresses and Strains in Teaching". That showed that a fair number of teachers are cracking up under the strain of teaching. Has the Department been considering this issue?
I understand that the Government consider that it would be desirable to set up a tertiary education council—that sounds like the top layer of a sandwich—or a higher education council as a forum for discussion of post-school education in Scotland. I am always a little sceptical of institutionalism as a means of resolving some of our educational problems.
It is a fact that the Scottish Education Department is not the Ministry responsible for the universities in Scotland. Having said that, in my view any higher education council ought to be representative of the whole of post-school education in Scotland, and must necessarily take all the further education colleges, central institutions and colleges of education, as well as the eight universities.

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I should like to hear the views of the Minister on this matter.
I gather from statements that have been made that the work of the Scottish Technical Education Council and the Scottish Business Education Council would not be undermined in any way by the setting up of a higher education council in Scotland.
I urge the Minister to consider the extent to which technical and commercial colleges in Scotland play an important part in servicing local industries, because I feel, that it is crucial to manpower planning—which, incidentally, is now a function of the Scottish Office—that there should be a close response between the needs of local industry and the services which are available in our further education colleges.
I mention in passing, for example, the concern that exists about the present and future status of the Glasgow College of Technology, which is neither a central institution nor an ordinary further education college, since it is servicing a fairly wide regional area.
The Minister will be aware of the representations that have been made on the question of the extent to which Scottish Education Department views are coming across within the European Community. Obviously, representations at this level would have to be dealt with by national education Ministries, and it goes without saying that the DES is the lead Department in the United Kingdom, for no other reason than that it is also the Ministry concerned with university education. But I do not think that that absolves the Scottish Education Department from taking a close interest and becoming as closely involved as it can in the shaping of educational policies within the European Community.
Earlier this year I wrote to the Commission because, as I understood it, the Belgian Government—which has two Ministries of Education, one for the French-speaking population and another for the Dutch-speaking population—makes sure that both language interests are fully represented at EEC level. I was advised by the Commission's directorate-general for research, science and education in a letter of 17th January, that the composition of delegations to the
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education committee is a matter for national Governments. In the case of Belgium, the delegation is normally representative of the ministries of both French and Dutch culture. It would seem to me that there really ought to be little or no problem in the Department's making sure that its views are fully aired at that level.
I have raised four broad issues on which I should like the Minister to comment briefly tonight. There was a time when the Scottish Education Department was reckoned to exercise a fairly tight control over education developments in Scotland. I was interested to note that in the evidence submitted by the Department to the Kilbrandon Commission this shifted in the mid-1960s to something more akin to the exercise of guidance. The Department is also the channel through which our education authorities in Scotland receive the bulk of their resources. There have been many initiatives in the last few years. What is the Department doing in those broad areas and in any other areas about which the Minister finds time to comment?
11.45 p.m.
The Under-Secretary of State for Scotland (Mr. Frank McElhone): I am grateful to my hon. Friend for raising these important matters. He mentioned four broad issues and talked of several other important matters. As he covered a wide range of matters which affect different Departments it is not surprising that I have only seven minutes in which to respond. I do not complain about that.
Mr. Deputy Speaker (Sir Myer Galpern): Would the Minister like an extension?
Mr. McElhone: I should certainly like an extension in order to allow my hon. Friend the Member for Glasgow, Maryhill (Mr. Craigen) to make a further contribution. I fully recognise his deep interest in education. He worked in education before becoming a Member of Parliament and, with respect to other hon. Members, I know of no other hon. Member who has a keener interest in education than he. I hope he will understand if I do not cover adequately the issues that he raised. But I shall reply to him by letter and invite to have furthcr dialogue with me.
Mr. Deputy Speaker: It will be a long letter.
Mr. McElhone: Long or not, it is important that I should write to my hon. Friend.
My hon. Friend began by drawing attention to worries about standards of attainment by pupils in some parts of his constituency. But he need not feel too concerned about a fall in standards in schools in Scotland as a whole. Mr. Farquhar Mackintosh—a name which is known to the hon. Member for Edinburgh, North (Mr. Fletcher), who is sitting on the Opposition Front Bench—has said that standards have not fallen but have improved in many areas. The evidence of the results of SCE examinations, the increasing proportion of qualified school leavers entering higher education, and the work of various research agencies on literacy and numeracy in primary and secondary schools, point to the fact that standards are being maintained.
I share my hon Friend's concern about what might be happening in individual schools.
I entirely agree with him that as additional resources become available for school staffing they should be used not to improve staffing standards generally but selectively wherever the need is greatest. With this in mind my right hon. Friend made additional resources available last year specifically for the employment of 500 extra teachers in schools serving urban areas of deprivation, including a number of schools in the hon. Member's constituency.
Approval was also given under the urban programme to the creation by Strathclyde of 84 additional teaching posts in certain schools in the Maryhill area and the East End of Glasgow. Both of these schemes will continue for a further two years.
But it is worth pointing out that it is for the education authority and head teachers concerned to deploy the additional staff in the ways that they think best, which can include those my hon. Friend has suggested. The provision for primary school staffing in rate support grant over the last few years has included an allowance for remedial teachers and visiting specialist teachers in primary schools.
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In the RSG settlement for 1978–79, however, we have made additional provision for school staffing and have provided for further improvements in our expenditure plans for later years. It is for each authority to determine how the available resources should be used in the light of its own estimates of needs and priorities within its area. It is open to each of them to implement, if they wish the suggestions which my hon. Friend has made.
My hon. Friend spoke at some length, and quite rightly about remedial education. He drew attention, in particular, to the great needs of certain areas for remedial education. As someone who pays particular attention to SED reports, he will know of the report by Her Majesty's inspectors of schools on the education of pupils with learning difficulties, published on 8th March. It was found that beyond the early primary years, few pupils had failed to achieve a reasonable competence in the early stages of reading, and the learning difficulties of most pupils arose not from lack of basic skills but from shortcomings in higher skills such as failure to grasp concepts and from failure to understand specialist terms. The pace and methods of presenting work were not always matched to the ability of pupils, and too little use was made of discussion.
The report suggests that most of the learning difficulties of pupils are best dealt with by their class teacher in the primary school and by the subject teacher in the secondary school. However, the report stresses the unique contribution which can be made by remedial specialists in providing intensive help for pupils who really need it.
Remedial specialists can also advise their colleagues. They are able to give short-term support to pupils with temporary problems, such as pupils returning from list D schools or from special education. Particularly on transfer from primary to secondary school, remedial specialists can do much to alleviate problems of transition. My right hon. Friend has commended this report to all teachers and hopes that it will be studied carefully.
My hon. Friend referred also to composite classes in primary schools. I know

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that there has been a great deal of concern among some parents and teachers about the increase over the past year or two in the number of composite classes in primary schools. The organisation of classes is, of course, the responsibility of education authorities and their head teachers, and it is for them to determine, within the resources available to them, the organisation which best suits the circumstances of individual schools.
I hope that it will be recognised that within the rate support grant that my right hon. Friend has allocated to local authorities for the coming year there is an element for employing teachers above the agreed standards, which one normally calls the circular 819 or Red Book standards, but I do not deny that there are difficulties for local authorities, and it is only honest to point out that local authori-
206
ties have a choice within the allocations of rate support grant on how best they wish to use the money provided by my right hon. Friend.
I refer in passing to the SED report which my hon. Friend mentioned as getting thinner and thinner. There is a good reason for that. We decided that, in order to make the best use of the facts in the report, we would take out the statistical evidence and publish it from time to time—
The Question having been proposed after Ten o'clock and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
Adjourned at seven minutes to Twelve o'clock.

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    Public Procurement Agency
    Building and Construction Industries
    Building and Construction Industries
    Direct Labour
    Direct Labour
    Construction Industry (Voluntary Registration Scheme)
    Construction Industry (Voluntary Registration Scheme)
    Council Housing (Garages)
    Council Housing (Garages)
    Civil Servants (Air Travel)
    Civil Servants (Air Travel)
    Wealth Tax (Departmental Premises)
    Wealth Tax (Departmental Premises)
    Fluoridation
    Fluoridation
  TRANSPORT
    M25
    M25
    Motor Car Bodies (Strength)
    Motor Car Bodies (Strength)
    Driving Tests (Hull)
    Driving Tests (Hull)
    Concessionary Fares (Schoolchildren)
    Concessionary Fares (Schoolchildren)
    Civil Servants (Air Travel)
    Civil Servants (Air Travel)
    North Devon Link Road
    North Devon Link Road
  FOREIGN AND COMMONWEALTH AFFAIRS
    USSR (Trials)
    USSR (Trials)
    Uranium Ore (Australia)
    Uranium Ore (Australia)
    Civil Servants (Air Travel)
    Civil Servants (Air Travel)
    Rhodesia (British Missionaries)
    Rhodesia (British Missionaries)
  SCOTLAND
    Homoeopathy
    Homoeopathy
    Hypnosis
    Hypnosis
    Acupuncture
    Acupuncture
    Abortion
    Abortion
    Gaelic Language (Publicity and Information)
    Gaelic Language (Publicity and Information)
    National Health Service (Finance)
    National Health Service (Finance)
    Housing (Glasgow)
    Housing (Glasgow)
    Scottish Development Agency (Factories)
    Scottish Development Agency (Factories)
    Civil Servants (Air Travel)
    Civil Servants (Air Travel)
    Primary Schools (Composite Classes)
    Primary Schools (Composite Classes)
    Unemployed Persons (Clydebank)
    Unemployed Persons (Clydebank)
  NORTHERN IRELAND
    Wages Councils
    Wages Councils
    Civil Servants (Air Travel)
    Civil Servants (Air Travel)

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

SCHOLARSHIPS: TAX ON COMPANY PAYMENTS
Lord BOYD-CARPENTER: 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 why and under what authority the Inland Revenue has decided to treat as liable to income tax certain payments made by companies by way of the provision of scholarships for children of their employees; whether the Government were consulted about and agree with this decision; and whether if such a change were for any reason thought desirable, the specific authority of Parliament should not have been obtained.
The SOLICITOR-GENERAL for SCOTLAND (Lord McCluskey): My Lords, the Board of Inland Revenue has been advised that the cost of providing scholarships for the children of directors and higher-paid employees by reason of the latter's employment is taxable as a benefit under the rules contained in Chapter II of Part III of the Finance Act 1976, despite the exemption given to scholarship income under Section 375 of the Taxes Act 1970, and proposes to contend for liability accordingly. The administration of the provisions relating to income tax is the statutory responsibility of the Board of Inland Revenue, not of the Government. However, Ministers were informed of this decision before a public announcement was made.
Lord BOYD-CARPENTER: My Lords, would the noble and learned Lord also answer the Question which is on the Order Paper, not only as to whether the
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Government were informed but whether they agreed? May I also ask him to say whether he thinks that at this moment to penalise good employers, who make a provision of this kind, by nullifying largely the effect of their action, and to tighten the screw on the most highly taxed section of people in the world, makes even the most rudimentary sense?
Lord McCLUSKEY: My Lords, the answer to the first point was really implicit in the Answer I gave; namely, that the statutory responsibility for these matters rests with the Board of Inland Revenue. It is not uncommon for the Board to change its practice in the light of changed circumstances; for example, a decision of the courts might well result in the Board receiving legal advice to the effect that the previous practice was based on an unsound interpretation of a statutory provision. It would not he appropriate to seek the authority of Parliament for a change in practice resulting from such advice. The proper course is to let the courts decide. In relation to the other point which the noble Lord raised, of course one does not want to penalise proper initiative, but, if a benefit is truly an emolument in the nature of income, it must be treated as such by the Board of Inland Revenue and the courts must decide whether or not their present reading of the provisions to which I referred is sound; it is not for the Government to intervene.
Lord BOYD-CARPENTER: My Lords, the noble and learned Lord pointedly did not answer the question as to whether this action by the Inland Revenue, in seeking to treat as taxable this year something which, under the same Act, they did not treat as taxable last year, had the agreement of the Government. If the conclusion is to be drawn, as I think it must be, that the Government disapprove of this action, in order to stop this nonsense will they take action to insert a clause in the Finance Bill which is now before another place?
Lord McCLUSKEY: My Lords, in the first place, as I sought to make clear; it is not for the Government to agree or disagree; it is for the Board of Inland Revenue to take the advice of its lawyers and, acting on that advice, to seek to charge tax in the circumstances where it is appropriate to do so. If the courts

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uphold the view of the Inland Revenue and come to the view that the charge is properly made, then it would arise for consideration whether the law requires to be amended; but the relevant law was passed in 1970, which re-enacted the previous provision, and in 1976. At the moment the position of the Government is that they will stand behind the legislation on the Statute Book.
Lord ROBBINS: On a constitutional point, my Lords, might I inquire of the Minister whether it is not the case that the Board of Inland Revenue is ultimately responsible to the Chancellor of the Exchequer?
Lord McCLUSKEY: My Lords, the Board of Inland Revenue, as I understand it, has the statutory responsibility to administer the law as contained in the taxing statutes; that is its responsibility.
The Earl of HALSBURY: My Lords, is the noble and learned Lord aware that this is the standard practice in Japan, a nation from which we could learn perhaps more than one thing at the present time?
Lord DRUMALBYN: My Lords, surely the noble and learned Lord would not deny that the Government could change the law so that it would he interpreted by the Inland Revenue in the sense they wanted it to be?
Lord McCLUSKEY: My Lords, of course the Government can seek to change the law by laying proposals before Parliament which would have the effect of changing the law; but the practice to which the noble Lord refers in the Question has obtained for some time. In June of this year the Board of Inland Revenue announced that, on taking fresh legal advice, it intended to change the practice. Of course, it does not intend to seek to change the practice retrospectively at all. For example, in respect of those employers who have provided such schemes and scholarships for the benefit of the children of employees, those schemes will not be subject to tax if they were made before the announcement by the Board of Inland Revenue; there is no element of retro-spectivity here.
Lord ROBBINS: My Lords, would the noble and learned Lord agree that, in the light of his answer—doubtless correct—to my question, the habit of the general public in blaming the Treasury for all kinds of oddities which happen in the administration of the tax law is completely misplaced; the Board of Inland Revenue is virtually, according to this interpretation, a sovereign State?
Lord McCLUSKEY: My Lords, I am indebted to the noble Lord. On a previous occasion, when I answered a Question and myself rather confused the Board of Inland Revenue with the Treasury, he has made this point. He is right to say that it would not be appropriate for the Government constantly to he stepping in to say to the Board of Inland Revenue, "Do this and do that". The Board has its statutory independence. If, as a result of its application of the law in particular cases, it is felt that an injustice or anomaly has arisen, then of course the Government may seek to introduce changes in the law.
Lord DRUMALBYN: My Lords, may I press the noble and learned Lord further on this matter? It seems extraordinary. If there is a challenge to the Inland Revenue's interpretation that comes to the House of Lords, will the noble and learned Lord undertake, if that challenge is successful, that all assessments of taxation so based in the meantime, before that decision by the House of Lords is reached, will be wiped out?
Lord McCLUSKEY: My Lords, I think that it would be quite inappropriate for me, without notice of that particular question, to offer such an undertaking. But what I can say is that I am quite certain that when the Revenue seek to charge to tax a particular emolument, and the courts decide that it is wrong, then it would follow from that that the Board will take certain action. I am quite certain that in this case it will follow the usual procedure.
Lord BOYD-CARPENTER: My Lords, arising out of his answer to my noble friend's question, could the noble and learned Lord explain how it is that the legal advisers of the Revenue this year advised that these payments were taxable,

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although apparently they did not last year? Have the Revenue changed the lawyers?
Lord McCLUSKEY: My Lords, anybody who has sat through the discussions of the Scotland Bill will realise that lawyers are not always unanimous—or, indeed, that they do not always say the same thing on Wednesday as they said on Tuesday. The position is truly this. Schemes of this kind were really quite rare until the last year or two, when there was a great mushrooming of such schemes, with new varieties and new dimensions. In the light of this great growth of such scholarships, the legal advisers looked at the matter again and, on this occasion, have offered the advice which the Board of the Inland Revenue are really properly obliged to take. It can be tested before the Special Commissioners, the General Commissioners, and ultimately the courts. That is all I can say properly upon the matter.
Lord PAGET of NORTHAMPTON: My Lords, is not the real complaint against the Board of Revenue that it allowed people to get away with an obviously taxable item for far too long?
Lord McCLUSKEY: My Lords, that is not Lord Boyd-Carpenter's complaint.

CONSTRUCTION INDUSTRY: POLICY
2.48 p.m.
Viscount TRENCHARD: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they plan to introduce the policy on the construction industry set out in the Labour Party's pamphlet of 1977 entitled Building Britain's Future, including those parts involving nationalisation.
Baroness STEDMAN: My Lords, Building Britain's Future provides a serious and thoughtful analysis of the construction industry's problems, but, as the document itself explains, it is only an interim statement to the Labour Party.
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We shall pay close attention to it as our policies evolve, but as my right honourable friend the Minister for Housing and Construction has made clear in another place on 29th June, we have no proposals to nationalise the building and construction industry.
Viscount TRENCHARD: My Lords, while thanking the noble Baroness for that reply, may I ask her whether that means that consideration is no longer being given to the proposals to establish a national construction corporation and a building materials' corporation—or is consideration still being given?
Baroness STEDMAN: My Lords, we had no proposals at all to set up a public procurement agency. The employees' and employers' organisations have accepted in principle proposals for decasualisation and my right honourable friend will be carrying forward consultations on the details of their implementation. Over the past 18 months we have done a considerable amount to boost the construction industry.
Lord CAMPBELL of CROY: My Lords, when the Government are considering this policy document, will they bear in mind first that the cost of the proposals in it has been estimated at £1½ billion; and secondly, that in 1950 Mr. Aneurin Bevan, who then had some responsibility for these matters, told the Party conference that nationalisation of the construction industry would mean very few houses being built during that dislocating process?
Baroness STEDMAN: My Lords, we have not costed the proposals in the document because they were only general ideas put to us, but I know that someone else has worked out and costed the supposed proposals in detail. What I can say is that the construction industry, as we all know, has suffered violent fluctuations over the past few years. We want greater stability in our construction industry. Both the industry and the Government place this as a very high priority. The Government themselves have added £800 million to public sector programmes up to 1980 both to raise the level of spending and to provide stability. Building Britain's Future is an interim document presented to the Labour Party

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and is being dealt with, presumably, in the same way as the recent interim document on the nationalised industries presented to the Conservative Party, which talked about selling off pits to miners' co-operatives, handing over civil airports, and the de-nationalisation of car manufacture, buses and freight. It is on precisely that level that this document is being looked at within the Labour Party.
Lord ORAM: My Lords, are not noble Lords opposite quite wrong in suggesting that the approach of the Labour Party to the construction industry is one of monolithic nationalisation? In fact, is not the essence of the policy statement one of flexibility and variety of method, including the establishment of workers' building co-operatives? Have not such co-operatives been highly successful, for instance, in France and Denmark for many decades? Is it not perfectly right that the Labour Party should examine the problems of the construction industry anew and seek to learn from the successes in other countries?
Baroness STEDMAN: My noble friend is quite right, my Lords.
Lord ORR-EWING: My Lords, will the noble Baroness say how she finds that a form of nationalisation is likely to give stability to the industry? Is this the evidence which comes from the steel industry, in which already 57,000 people have been shed since vesting day? Is this the evidence which comes from British Leyland, in which the TR 7 factory at Liverpool has been closed, and in which other factories have been closed in a rundown of personnel? What makes the noble Baroness think that nationalisation produces stability?
Baroness STEDMAN: My Lords, I did not say that. I said that we have no proposals for the nationalisation of the building and construction industry.
Lord CARR of HADLEY: My Lords, in considering these proposals, as, presumably, the Labour Party and the Government will be doing, will they take into account two factors? The first is that the nationalisation of two, three, or four of our major building and engineering construction contractors would un
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doubtedly reduce very substantially the enormous export business which those companies do at present. Secondly, will the Government bear in mind that public opinion polls have shown that a very large majority of people of all Parties, and of none, are wholly opposed to these proposals?
Baroness STEDMAN: My Lords, the proposals in the document have been considered by both the employers and the employees in the industry. The trade unions have, on the whole, welcomed the document, but they have attached much more importance to the proposals for greater stability of demand and of employment than to those on public ownership. The employers still do not accept the Statement made in another place by my right honourable friend and repeated by me today; namely, that we have no proposals to nationalise the construction and building industry.
Lord MOTTISTONE: My Lords, the noble Baroness mentioned decasualisation, rather implying that that was going to go through. Can she reassure us that at this moment that is only an idea, rather than a solid proposal, and that in any case the Government are taking careful note of the difficulties that have arisen over decasualisation in the docks, which have led on the whole to problems and expenses on all sides?
Baroness STEDMAN: My Lords, with regard to decasualisation, I said that my right honourable friend was carrying forward consultations with the industry. What Building Britain's Future proposed was a statutory decasualisation scheme with registers of employers and employees, and fall back pay for temporarily unemployed workers administered by a statutory Construction Industry Manpower Board. The Construction Industry Manpower Board itself was set up in 1976 and was asked to advise on the desirability of such a statutory decasualisation scheme. It reported in December 1977 that a voluntary scheme, if fully supported by both sides of the industry, would be preferable. The TUC and the main employers' federations have accepted the voluntary principle, and that is the line on which the Government are now working, and which they are pursuing in consultations.

LANGUAGE INSTITUTION FOR ARMED FORCES
2.53 p.m.
Baroness WARD of NORTH TYNE-SIDE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether the academic institution set up in the South of France after the last war to which members of the Armed Forces of the United Kingdom were sent to learn foreign languages still exists; or, if not, when it was disbanded.
Lord WINTERBOTTOM: My Lords, I regret that I have not been able to identify the institution which the noble Baroness has in mind.
Baroness WARD of NORTH TYNE-SIDE: My Lords, I thank the noble Lord for that rather odd Answer, and I should like to ask what records have been examined. I have in mind, for instance, the general records which may be held by the Ministry of Defence; or perhaps Mr. Winston Churchill's records. There are a large number of records. I notice that in his Answer the noble Lord has not said whether he is certain that my information is incorrect. I can assure your Lordships that it is not incorrect.
Lord WINTERBOTTOM: My Lords, the question refers to the South of France. In these circumstances, we have rechecked all likely sources, including the defence attaché's office in Paris. The Royal Army Education Corps, and its museum, the curator of the Intelligence Corps Museum, the Foreign and Commonwealth Office archivist, the Director of Education, RAF, and the MOD Library, are unable to throw any light on the subject.
Baroness WARD of NORTH TYNE-SIDE: My Lords, I find that most peculiar. Perhaps the noble Lord would be kind enough, when he has the opportunity, to consult one of my colleagues in this Chamber, the noble Viscount, Lord Maugham. He certainly had something to do with the institution to which I have referred; in fact I had much to do with it myself.
Lord WINTERBOTTOM: My Lords, if the noble Baroness would be so kind as to meet me in some other place, we might discuss the matter.
Lord PAGET of NORTHAMPTON: My Lords, can my noble friend give us any estimate of the cost of pursuing this extensive, if somewhat fatuous, inquiry?
Lord WINTERBOTTOM: My Lords, without knowing the facts, I cannot say whether or not it is fatuous, but the expense is surely part of the general overheads of running the Ministry of Defence.
Lord LEATHERLAND: My Lords, in view of the fact that some mystery seems to surround this institution, will the noble Lord consider sending a delegation of Members from this House to the South of France during August to make investigations?
Lord WINTERBOTTOM: Certainly, my Lords, if it was to be the House of Lords Defence Study Group.
Lord ANNAN: My Lords, does the noble Lord know whether it was by any chance the institution which Sir Terence Rattigan once attended?

PRODUCTIVITY AND JOB OPPORTUNITIES
2.55 p.m.
Viscount AMORY Viscount AMORY rose to call attention to the dangerously low level of productivity in this country in relation to that of our main international competitors, and to the need to stimulate new and constructive job opportunities which would follow from an improvement in our national productivity; and to move for Papers. The noble Viscount said: My Lords, this debate fits in well with the one initiated so ably by the noble Lord, Lord Baker, two weeks ago. He dealt specifically with engineering. Today's debate goes rather wider, but the theme is the same. I wish to say how much I am looking forward to hearing the maiden speech of the noble Lord, Lord Roll of Ipsden. Many years ago he and I worked together when he was a distinguished civil servant.
I am not sure that I am the right person to be introducing the Motion. Though I worked in industry for the best part of 20 years, I have been retired now for quite a long time. I should therefore think that it would be an impertinence on my part to claim any longer that I have any first-hand knowledge of the subject which we shall be discussing. Therefore, I can speak only as an armchair critic. As such I shall confine myself to a few assertions which I fear your Lordships will not find reason to dispute, and then suggest some deductions which I hope noble Lords from all parts of the House will be able to throw light upon from their own wide and varied experiences.
I am moving the Motion because I believe that our current level of productivity is the most serious of all our economic problems, because it lies at the root of most of the others, and I fear that it is likely to prove the most intractable of them all. There is a mariners' saying about bad weather:
"Quick come, soon past;
Long warning, long last".
I do not want to introduce a note of unrelieved despondency, far less of despair. Our level of performance in terms of productivity of both manpower and machines is a matter entirely within our own powers to decide. We can improve on our current standards dramatically; and if we do, that will open the way to a higher standard of living, and in the long run to expanding opportunities for employment in ever widening fields of endeavour.
Nor do I want to indulge in recriminations; the blame for our performance does not lie with any one section of the community. What was done in the war, when this country organised itself for production to a greater extent than any other, shows what the nation can do when it decides that it must be done. I refuse to believe that our nation has changed its character in 35 years. So it is not an impossible or insoluble problem we are talking about, but, as so often when deteriorating performance has to be reversed, it is by no means an easy one to surmount. Our relatively low level of productivity is no new thing. It was noticed and commented upon in the very early days of the present century,
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and even before. It has not been brought about solely by trade unions' restrictions and attitudes, though those are sometimes serious factors. It is not confined to large manufacturing units, nor even to manufacturing. Perhaps it is an attitude which runs through broad sections of our national life.
It is most obvious in large manufacturing units because it is more easily measured there. For many years it was excused by a traditional pride in the accepted superior quality of British goods in terms of their durability and reliability, but I fear that this superiority cannot be taken for granted today. Then its existence was masked by a plentiful supply of manpower available, and by its relative cheapness, which made the use of manpower cheaper than the installation of expensive labour-saving devices. For a decade or two after the last war we were misled by a rapid increase in our standard of living—the fastest that had ever occurred in a comparable period—which concealed the still more rapid progress of our competitors. We began to believe that the problems of production were solved. Today our low productivity, relatively, is starkly exposed. It is so serious in some important sectors that it seems to postulate a continuous process of reduction in the value of our currency as a necessary condition for the competitiveness of our exports—and this when Germany and Japan, in spite of increases in the value of their currencies, seem unable to overcome their propensity to export.
I shall weary your Lordships with only three key statistics, as I fear that almost any tests produce the same answer. The exceptions are significant and worth brooding on. I have chosen three statistics to illustrate our plight; other noble Lords will quote others as significant. The first is in value added per man-hour in manufacturing. In 1955 four out of five EEC countries were above the United Kingdom by from 8 to 18 per cent. By 1973 they were above it by from 54 to 93 per cent. Then the Think-Tank sent a team to the Continent to examine car manufacturing and assembly plants. In every case examined, output per man on the Continent was at least 60 per cent. higher than in the United Kingdom, and often double as high. Thirdly, the statistic that Sir Ronald McIntosh, the former Director-General of NEDC, considers

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the most striking of all in relation to the British economy is the following. In 1953 our share of world exports of manufactures was 23 per cent., and Germany's was 19 per cent. Twenty years later Germany's share had risen to 23 per cent. and ours had fallen to under 8 per cent.
Some economists tell us that there is no prospect of absorbing the unemployed in manufacturing. If the volume of manufacturing is thought of in terms of existing products, this may well be true. But there is no reason to suppose that new products will not continue to come up over the horizon, introducing new and undreamed of jobs; and the demand for services of one kind or another is limited only by consumers' pockets. It may well be that it is in that ever-widening sector that the biggest growing demand for manpower will lie if we can get our costs competitively right. It is significant that only one-third of the working population in the United Kingdom are employed in manufacturing, whereas in the United States the percentage is 25 per cent. Fortunately, some services are exportable. In a recent debate my noble friend Lord Harmar-Nicholls quoted a figure which I found impressive. He said that there are about 800,000 small businesses in the United Kingdom. If each could expand their business enough to take on one extra employee, unemployment would be halved. In this matter, I believe the Employment Protection Acts, however laudable their objects, are doing a great disservice by discouraging small employers from running the financial risks of taking on extra employees unless they can be absolutely certain of the expansion of their business.
It is true, as Mr. Maudling wrote the other day, that our problem is not basically over-spending but under-earning. But under-earning cannot be put right by paying ourselves more for less output. That is the trouble with work-sharing proposals which otherwise might be sensible. Unless practised by our competitors too, they would put up our relative costs still further. However, we cannot regard one and a half million unemployed as tolerable, particularly when something like 40 per cent. of the registered unemployed are relatively young people. It is a national tragedy. Why is agricul
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ture such a notable exception? It is partly, I think, because of the revolutionary effects of mechanisation and the highly productive work of the scientists and the plant and animal breeders; but also almost certainly because of its organisation in small personal and intimate units, where satisfaction in the job is more prevalent and the boss identifiable and usually accessible.
Unfortunately, a higher rate of investment alone may not solve our problems. We are not always making the best use of existing investment, and our new investment does not always attain the productivity it ought. In December 1964 a joint statement of intentions in regard to productivity, prices and incomes was signed at Lancaster House. This sounded hopeful, but results to date seem meagre. So the answer does not wholly lie in simply more investment. Our volume of investment is not actually all that bad. The percentage of the national product has been broadly the same in Britain and the United States in post-war years. Does it lie in the quality of our investment, or do we dissipate the gains in overmanning or paying ourselves too much in cash or in social benefits? We do not need more investment as much as more productive investment. Recently I read some criticism of multinational companies for not investing more in Britain. Multinational companies, my Lords, would be quick enough to invest in Britain in preference to elsewhere if our costs of production were right.
I fear it must be admitted that the traditional attitudes of our trade unions to problems of overmanning in the believed interests of their members are often a severe handicap. Rarely indeed does one come on pressure from British trade unions, as I am told one does in some cases in the United States, for more efficient and economical production in the interests of their members. They are apt to say, "That is a problem for management", forgetting that it is the key to higher earnings for their members and therefore the most important thing of all for the prospects of a rise in real earnings for their members. Unless the trade unions can throw their weight behind efforts to increase productivity, and therefore pave the way for higher real wages, they are doomed in their efforts to win

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higher real earnings for their members. I hope that wider participation in industry may help in this vitally important matter.
Having said that, I do not want to imply that trade union restrictions are the sole reason for our low productivity—far from it. Management must also carry its fair share of blame. Much of our management, in both big and small firms, is as good as any; some is mediocre. Some has become discouraged by current difficulties, and has lowered its sights. Most managers work hard. What I think our managements need, across the board, is not replacement but practical encouragement and appreciation. Ambition is not given enough scope, and success is not adequately rewarded. We all know from history and from our own experiences how much the success of industry, as of any other collective activity, depends on the flair, the talents and the leadership of a minority of exceptional people. Does British industry today secure as high a proportion of the ablest young men and women as it needs as the main earner of our national living? I am afraid the answer is that it does not. Why? Is it because the rewards of entrepreneurial skills are much less today? Is it because industrial management is beset by frustration arising from industrial disputes or from over-detailed Government regulations? Is it because there is less public appreciation than there ought to be of the rÔle of industry? Are our educational aims and institutions to blame? I believe it is for all these reasons.
Research that I have read has shown that in the British car industry plant managers who were interviewed by the Think Tank told them that in England managers spend half of their total time dealing with industrial disputes and troubles as against the 5 per cent. to 10 per cent. quoted by their Belgian and German competitors. That is secondhand information and I cannot vouch for it. There are solid grounds for thinking that many of our traditional attitudes to education, and its existing patterns, are not attuned to the needs of industry or sympathetic to its importance. Too much first-rate ability gets diverted to other careers. Management training, too, is below that of our international competitors.
Governments must realise that no one is likely to invest unless and until they
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can see some return on their investment. They would be deluding both their shareholders and their employees if they were to do so. The reason why British industrial investment is not higher is the lack of the prospect of a reasonable return for efficient production in current circumstances. It must be right to give top priority to a continuing reduction in the rate of inflation and to emphasise the part that wage restraint has to play in this. We need some kind of incomes policy, but one which will leave room for differentials for skill and responsibility.
Government cannot itself run industry; Government cannot itself finance industry. Its task is to provide the economic conditions in which industry can do these things efficiently for itself. The biggest single disincentive of all, I believe, is the present level of direct taxation at all levels. Personally, as an old hand, I am in favour of a drastic reduction in direct taxation even at the expense of an increase in indirect taxation. Taxation of spending is better than taxation of earnings. A drastic reduction in direct taxation, incidentally, would help greatly in this problem of very high before-tax salaries. Our biggest handicaps, I believe, are the present penal levels of direct taxation and what I might call a lack of zest for adaptation and new attitudes. The two may well be linked. Our declining competitiveness, if it goes on, must lead to a steady devaluation of our currency, higher relative inflation, a lower standard of living, and a further sapping of morale.
For a nation that has to live on trade, competitiveness is the crucially important thing. The increasing trend towards higher manufactured imports is most discouraging. If we can get out productivity right, we can save enormous sums spent on unnecessary imports. If Ministers should be disposed to defend our productivity record—and I do not believe for a minute that the noble Lord the Leader of the House will do that unreasonably; he will speak carefully in whatever he is going to say to us—I would invite them to re-read the Treasury's economic progress report of December 1977. There, they will be reminded that in the most recent decade real earnings per head in manufacturing industries in every major industrial country, except for the United States, grew at least at twice the rate achieved in the United Kingdom. Unless

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we have the will to make the necessary exertions to face up to the changes required by a highly competitive international system, our relative standard of living must continue to fall. We must be competitive or die.
Very few of our people are happy with a second-rate national performance. An improvement in productivity per man-hour or per machine-hour will not immediately increase employment. In particular cases it will have the reverse effect. When an increase in employment comes, it may be in another kind of production. That is why understanding it is so difficult for those directly involved by redundancies. It is difficult for them to accept the necessity. Putting oneself in their position, one can fully sympathise with them; but it is, unfortunately, the only way to increase employment without reducing our standard of living.
The lesson that we have to learn is that higher productivity is the only practical way to higher real earnings and higher employment. I shall look forward to hearing the thoughts of the noble Lord the Leader of the House on these reflections. I hope that this debate may make a modest contribution to a better understanding of this, our most pressing economic problem. I beg to move for Papers.
3.17 p.m.
The LORD PRIVY SEAL (Lord Pearl): My Lords, this is the second debate on an issue of industrial policy and the importance of enterprise and growth. May I say to the noble Viscount, Lord Amory, that I think he made a moderate and fair and, for that reason, all the more effective speech. I would not call him an armchair critic. After all, as an ex-Chancellor of the Exchequer and a distinguished Agricultural Minister, he has had a lot of experience, and he was right to point to some of the policies that we must think about if we are to improve enterprise in this country and overcome our economic difficulties. His speech was a good beginning to what I hope will be a very fine debate from all sides.
As I have said, this is the second debate on this subject and that indicates the importance which your Lordships
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place on the need for improvement in the international competitiveness of British manufacturing industry. The Motion before us today calls attention to two things: first, the low level of productivity in this country relative to our main international competitors; secondly, the need to stimulate new and constructive job opportunities in the light of success in improving our national productivity performance. This second requirement is a central objective of the industrial strategy programme. I will try to give the Government point of view in reply to the noble Viscount, and no doubt the debate will be taken up, different points will be assessed, and my noble and lerned friend Lord McCluskey will be winding up. May I say that I agree with the noble Viscount about our low productivity. Low productivity and unemployment, as he has said, are not problems which have arisen overnight; nor can they be solved overnight.
Our unsatisfactory economic performance since the war, reflects our relative failure to deal with industrial problems. After all, we were one of the first industrial nations; but, as the noble Viscount has said, we have been overtaken by many competitors. Probably the most revealing indicator—and he referred to similar figures and statistics—is the decline in our share of exports of manufactured goods by major industrial countries. In 1956 our share was 19 per cent.; in 1975 it had fallen to 9 per cent. All the original EEC countries have maintained or increased their share since 1963, whereas ours has fallen by 40 per cent. In 1963 Japan's share was half of ours and now it is 1½ times as great. I believe that we must take note of these figures. They are figures which are challenging and if we do not rise to a desire to overcome our difficulties, then I think we shall fail. The nation, the Government—indeed, all of us—must see that we go the right way towards economic recovery.
I believe that at no time in our history has the need for increased productivity been greater. It is ironical that Britain did so much in the past to help foster productivity in countries like West Germany. Many noble Lords know that after the war, for example, it was the British zonal authorities who helped create a sound trade union structure in Germany, and who put a tremendous

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surge of purpose into the West German economy by helping to plan and execute the 1948 currency reform. We now find our productivity lagging behind that of the West Germans. It has recently been suggested that if total United Kingdom productivity grew at 6 per cent. per year and West German productivity grew at half this rate, the United Kingdom would still not catch up with West Germany in terms of GNP per head until the end of this century. When one compares that 6 per cent. rate with our actual annual increase in productivity in recent years of 1 per cent., the extent of the task which confronts us is amply demonstrated. We now need to do for ourselves what we have been able to do for our present competitors in the past.
It is against this background that the Industrial Strategy programme was launched. The White Paper introducing the Industrial Strategy in November 1975 emphasised the importance of sustaining both private and public sectors as "vigorous, alert, responsible and profitable" and promised that, for the immediate future at least, the Government would give the development of manufacturing industry priority over consumption or even social objectives. I am sure that the noble Lord who moved the Motion today will not disagree with those main principles.
The Strategy is a new concept in industrial planning. It recognises that we not only have to tackle our immediate problems, but get to grips with the long term needs of British industry. From the outset, the Government rejected the approach of macro-industrial planning imposed on industry from above, and I think that we were right to do so. Instead, we committed ourselves to developing a national Industrial Strategy based on analysis and recommendations at sectoral level. I know that this has its critics; but those criticisms that I have seen have notably lacked any positive alternative and I believe that what we are doing represents the best way forward. The essence of the new approach was the development of an Industrial Strategy through tripartite co-operation: co-operation based on Government, management and trade unions working as equal partners.
As noble Lords know, some 40 sector working parties were set up composed of
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representatives of all three groups. They have spent two years working together, analysing the performance of their sectors, pooling their ideas on what is required to improve competitiveness and agreeing recommendations for action. Between them sector working parties cover some 40 per cent. of manufacturing output in this country, about 46 per cent. of manufacturing employment, and nearly half of all exports of manufactured goods.
I need hardly remind your Lordships that the Industrial Strategy was initiated at a meeting of the CBI, TUC and Government held at Chequers in November 1975: a time when the world recession and our home recession were getting deeper; the five-fold oil price increase was just beginning to bite; the unemployment rate was rising; there was massive price inflation; and several major private companies had virtually collapsed: Burmah; British Leyland; Chrysler; and Alfred Herbert.
The months following the launch of the strategy were just as difficult—our domestic situation worsened; corrective action had to be taken about our forward plans for public expenditure; and interest rates reached record levels. During all this time, nevertheless, the cornerstone of the Strategy was maintained and the numbers in employment have increased. This was the tripartite basis of Government, management and workforces seeking to reverse the relative decline in our industrial performance with its characteristics of low investment, low wages, a depreciating currency and low productivity. Corrective action had to be taken on our forward plans for public expenditure.
Lord ORR-EWING: My Lords—
Lord PEART: My Lords, if I may continue. There are over 30 speakers on the list. I do not mind, as the noble Lord knows, and I like debate and the type of procedure in another place; but I think, in the circumstances, I must give the Government point of view.
However, through it all, the Strategy and its objectives have remained intact. All the sector working parties have contributed to the work of the Strategy—some more strongly than others. The Clothing Economic Development Committee, for example, have done an ex

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cellent job in communicating the work of the Industrial Strategy to individual companies. Similarly, in the field of export promotion good progress has been made by the Mining Machinery Sector Working Party and the Food and Drink Economic Development Committee. The Mechanical Handling Sector Working Party has been particularly effective in the productivity field.
The first task of the working parties was to form coherent units out of disparate groups of people from management, trades unions and Government. It is to their credit that they have sought to put aside any past differences and to isolate and overcome the problems of their sectors. The sector working parties accepted that increased international competitiveness could only come through a shouldering of responsibility by both management and trade unions for improving performance.
Much of the early work of the working parties concentrated on short term problems which might hinder output as the economy emerged from recession. This work included identifying potential bottlenecks to growth which would prevent industry from taking advantage of any upsurge in world trade, and suggesting means of removing them. In the course of last year, the working parties have refined their provisional objectives for ambitious improvements in their sectors' share of home and overseas markets.
About half the working parties have quantified their objectives for exports and imports. These plans imply an immense improvement in the trade balance for their particular industries. If we could achieve an improvement in the trade balance of this magnitude, we could expand the economy faster and create many new jobs by 1980. But the achievement of the market-share objectives is conditional upon a marked improvement in performance to which high productivity must make a major contribution.
For their part the Government have responded positively and imaginatively to recommendations from the sector working parties. For example, a number of the working parties recommended changes in the facilities offered by the Export Credits Guarantee Department. As a result, some
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facilities have been extended considerably. For instance, the minimum value for contracts qualifying for support under the bond support scheme was lowered from £2 million to £1 million and has recently been lowered further to half a million pounds. As a result of comments in sector working parties' reports, the Government have introduced in consultation with industry, an export market entry guarantee scheme to help firms in manufacturing industry deal with financial risk and problems associated with a venture to develop a new export market. The noble Lord, Lord Soames, smiles at that. But this is positive work and a joint effort by management, trade unions and Government. It is very important and I know that he wishes them to succeed.
In their general management of the economy the Government have sought to provide industry with greater stability and increased incentives. This has been the theme of successive Budgets. The Government's economic objectives are sustainable full employment and a growing economy within which standards of private consumption and public provision are able to rise. Achieving these aims entails reversing the long erosion of our industrial performance that has led to our present problems. I agree with the noble Viscount, Lord Amory: there are no short cuts.
It is undoubtedly true that one of the problems that has beset our industry has been the repeated change of policies by successive and competing Governments. Not only has industry in the United Kingdom had to cope with the growth of world-scale markets but also with a mass of new legislation, some of it justified for social reasons. I believe, however, that the prospects are now improved with the development of the Industrial Strategy. The problems and prospects for manufacturing industry are being studied in much greater detail than ever before, with a view to developing strategies for improving the performance and competitiveness of each sector.
One of the crucial areas in which action must be taken, and indeed is being taken, by the Government and many others is in ensuring an adequate supply of well-qualified engineers and managers to take responsibility for developing our manufacturing industry. I was glad that the

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noble Viscount, Lord Amory, raised that point; and indeed in our previous debate there was great emphasis on the need to have good management and to attract engineers. To attract more of our ablest young people into engineering and management, we have to improve the image of industry and offset some of the attitudes that develop within our education system by a higher esteem for practical skills. There is still too much snobbery in that field. There is much to be done but Government, education authorities and industry itself, with the support of the trade unions, are working together and making significant progress in this field. The Department of Industry has set up a special Industry-Education Unit.
Schoolchildren are gaining a more positive interest through conferences on the "challenge of industry" run by local education authorities and by participating in competitions such as the "Image of Industry" run by the Guardian newspaper. The CBI has set up a project called "Understanding British Industry" to increase the flow of information available to schools. The Government are examining further ways of supporting and extending the careers service and strengthening individual company's links with their local schools. In higher education the same picture prevails.
At the same time we have, of course, to ensure that the qualifications gained by young people, both at school and at higher levels of education, are relevant to the types of opportunity in industry that they are learning about. New "enriched" engineering courses are being introduced at several British universities. These are high-level degrees for the very able, oriented towards manufacturing industry. The industrial training boards are introducing special fellowships for study in relevant courses, and individual firms are increasing their financial sponsorships for both students and courses. A scheme of some 100 scholarships jointly funded by Government and industry is to be introduced this year. The Government already sponsor a scheme of "Teaching Companies" to enable post-graduate students to work closely with industry.
These measures are already beginning to show some beneficial effects and the number of applicants for science and technology courses, at all levels, is increasing. Similarly, firms have reported
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over the last two years a significant increase in the number of applicants and are finding a higher proportion of these to be suitably qualified for recruitment. For the first time in many years, firms are reporting that the tide seems to be running in their direction. I am sure the noble Viscount, Lord Amory, will welcome this. The Government plan to support further the many initiatives which have helped to turn the tide.
Industry requires the prospect of sustained expansion if it is to invest and prosper. Through our policies, we have succeeded in creating a firm basis for this expansion. Thanks to the magnificent co-operation of the trade union movement, inflation is now down to 7·7 per cent. We achieved a current account surplus on the balance of payments of over three-quarters of a billion pounds in the second half of last year; results for the first part of this year are consistent with the Chancellor's estimate that we shall achieve a modest surplus in 1978. Whilst it is true that there was a temporary check in the increase in manufacturing investment in the first quarter of 1978, in real terms manufacturing investment was 8 per cent. Higher last year than in 1976 and, if iron and steel is excluded, it rose by 14 per cent.
One highly significant new investment has taken place in my old constituency of Workington. Thames Board Mills have invested £100 million to expand production of carton-board. This investment is evidence of the confidence that people have in the future of this country. The project has attracted an incentive of £10·5 million under the Government's Selective Investment Scheme, and the work on the project was inaugurated by my right honourable friend the Secretary of State for Industry at the end of May. This sort of project will help considerably all round and will lead to substantial orders for the construction and plant equipment industries. It should reduce imports and lead to an annual benefit to the balance of payments of some £30 million from 1982. In addition, in a development area some 300 new jobs will be created. This is what we want. This is why we believe it is right to give special incentives in areas where they are most needed.
The Department of Industry's latest survey of investment intentions supports

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the earlier expectation of an increase in manufacturing investment of 10–13 per cent this year, with a further increase in 1979. GDP is growing and, following the Chancellor's Budget, should grow by about 3 per cent this year. Of course, slow growth in the world economy is a major constraint on our own expansion and our prospects for a return to full employment. There are 16 million people unemployed in the OECD countries taken together. That is why, in the run-up to the July economic summit, the Prime Minister is working so hard for a programme of concerted action by major industrial countries to promote world expansion.
Our medium-term economic prospects have been substantially improved by North Sea oil. But this windfall could easily be frittered away. The Government are determined that it is not: the March White Paper sets out our priorities clearly, with investment in industry and improvement in industrial performance heading the list.
The United Kingdom has been a relatively slow-growing economy. Whatever reasons may be adduced for this, a slow-growing economy will tend to be one which creates new employment opportunities less readily than others. It also gives rise to a situation in which working people seek to retain existing jobs at the price of reduced productivity while management becomes unwilling to invest in the face of declining profitability.
A central objective of the Industrial Strategy is to secure an improvement in the productivity of the United Kingdom industry. Even if, initially, an increase in productivity greater than the increase in demand in a particular industry is reflected in a fall in employment, the resulting improvement in competitiveness should lead in due course to increased demand for the products of that industry and help to restore employment there. But if, for structural or other reasons, this does not occur, a reduction in employment in that industry still does not necessarily result in a sustained reduction in employment overall, because the initial rise in productivity will have favourable effects on real incomes and demand.
There is one aspect of productivity with which I am particularly concerned
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personally. That is the contribution to productivity which can come from the development and application of new technology on industry. Noble Lords will be aware that, within Government, I am charged with the general oversight and co-ordination of science and technology issues which span the interests of two or more Government Departments. To help me in this task, I have the invaluable support of the Advisory Council for Applied Research and Development; ACARD as it is known.
ACARD is particularly concerned at the moment with one area of technology with very great implications for productivity. This is the application of microelectronics and micro-processors, which, as many noble Lords w ill be aware, offer British industry tremendous opportunity both to cut its costs and to develop and supply a whole range of improved consumer and capital goods for the home and export markets. ACARD w ill shortly be receiving the report of a working party under Mr. Robert Clayton of GEC, which is looking at the whole question of applications of semiconductor technology. When this is received, it will be studied with a great deal of urgency by the Department of Industry and the other Government Departments concerned. They, of course, have already been doing a great deal of thinking and the Secretary of State for Industry will very shortly be announcing an initial scheme to assist British industry to take full advantage of the new technology.
But how will society adapt to these opportunities and what are the risks involved? The rapid development of micro-electronics, as well as being one of the most significant opportunities of our time, also presents us with a number of challenging issues including its effect on employment. Work is currently under way in assessing the likely impact of this new technology on employment, under another working party of ACARD chaired by Sir James Menter. The Department of Employment's Unit of Manpower Studies is studying the manpower effect of micro-electronics, and the Prime Minister has instructed the CPRS to act as the focus for dealing with the wider implications of micro-electronics technology.
It is essential that we look at all factors affecting productivity. To improve our

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industrial performance we must ensure that all productive resources are used to the full: materials, machinery, space, energy, time and finance as well as manpower. Under-use of capital and poor methods of work are clearly important influences on labour productivity. Other non-price factors also affect our international competitiveness. For example, although the United Kingdom has a well-deserved reputation for the quality of design, it has long been recognised that insufficient attention is paid generally to design and designers in many firms. As a result of the low status of design, it has become an area which now attracts too few of the more talented people. Our ability to design consumer products for world-wide sales appears to have declined over the past decade or so, particularly when compared with that of nations such as Japan, France and Italy. This situation needs to be altered.
I come very nearly to the end of what I have to say. One of the industries with the most remarkable records of improvement, as the noble Viscount, Lord Amory, rightly said, is agriculture. I am sure that the noble Lord, Lord Soames, as a former distinguished Minister will agree with him, as I certainly do as a former Minister. I believe that we have a wonderful success story there in an industry which has increased productivity, which was so much due to another famous Minister, Tom Williams, whose Agriculture Act in 1947 virtually revolutionised the British countryside.
When I look at agriculture today I see that man-hours per hectare of wheat declined from 82 in 1950 to 16·2 in 1976, while normal yields of wheat have increased by about 60 per cent. In milk production, labour requirements per cow in a herd of some 40–50 cows declined from 109 hours a year in 1955 to 59 hours in 1975. In the same period, the average yield per cow in this country increased by some 40 per cent. to over 4,000 litres. United Kingdom milk production increased from 9,700 million litres to 13,600 million litres, while the number of milk producers fell from 175,000 to 77,000
These increases in labour productivity have been reflected in national statistics. In the two decades from the mid-fifties to the mid-seventies, the net product of
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agriculture increased by more than 75 per cent. This has been achieved by a smaller labour force and a substantial increase in capital investment. The number of people employed in agriculture declined from 788,000 in 1955 to 380,000 in 1975—a decline of 52 per cent. All this has been achieved from a declining area of farmland. We must pay tribute to the industry and this is an achievement of which we can be proud. It reflects the greatest credit on all concerned—the farmers, the farm workers, the managers. the scientists and all those people in the Ministry. May I also pay tribute to the two Ministers who will be speaking in this debate. Each in his own way made a distinctive contribution which nudged agriculture forward, and which acts as a guide to what can be done if there is a will. The result is that British agriculture has developed a formidable competitive strength. I want to see this in other sections of industry, and I believe that it can be done. I feel that this is an important debate, and I hope that some of the facts and some of the indications of policy emphasis which I have given will be taken up. I believe that the Government will succeed and that we shall steer the nation through its difficulties.
3.45 p.m.
Lord CARR of HADLEY: My Lords, I should first like to join in thanking my noble friend Lord Amory for initiating a debate on this subject. I agree with him that it is complementary to, and a valuable enlargement of, the debate which we had a fortnight ago raised by the noble Lord, Lord Baker. Like my noble friend, I should also like to say how much I am sure we are all looking forward to the maiden speech of the noble Lord, Lord Roll of Ipsden, because most of us know of his great knowledge and experience in matters so closely connected with this subject. I am in no doubt that, in concentrating our attention on the poor level of productivity in Britain compared with other countries, we are, in fact, concentrating on the single most important factor underlying Britain's poor industrial performance. All the evidence, whether from economic or statistical analysis, or from direct industrial observation, shows that there is now a huge gap between the overall level of productivity in Britain and that achieved in other industrial countries.

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Only just over 20 years ago, in the middle 1950s, it was estimated that our labour productivity in Britain was probably 15 per cent. better than that in France and Western Germany. But by the middle of the 1970s—only 20 years later—labour productivity in Germany and France was estimated to be about 30 per cent. higher than ours. This is a disastrous change in a mere 20 years. That, of course, is referring only to labour productivity. My noble friend, in opening this debate, quoted figures comparing productivity measured in terms of added value—a much more fundamental figure; and comparisons in terms of added value which he gave to your Lordships make our position appear even more serious.
That this disastrous deterioration in our productivity, compared with that of other European countries, as well as with the United States and Japan, has been continuing in the last few years is shown clearly in figures given by the Treasury in another place in Answer to a Question only a few weeks ago. I would refer noble Lords who are interested to column 556 of Written Answers in the House of Commons Hansard of 23rd May. It is only when we, at last, give real and effective priority to increasing our productivity that we shall be able to halt, and then to reverse, the dramatic and continuous fall in our standards of living compared with those in other countries. It is only then, as the Motion also states, that we in Britain shall be able to "stimulate new and constructive job opportunities without which we cannot solve our problem of unemployment.
The link between productivity and pay and prices is, of course, very obvious. In the long run, it is clear that we cannot pay ourselves more in real terms than we earn by our production. In the long run, it is also obvious that if our productivity is low our prices must be high, or higher than they would otherwise have been. Equally fundamental, however, although not so obvious, is the link between improving productivity and reducing unemployment. Indeed, of course, the fear at shop floor level, and among those who represent shop floor level in the union leadership, is that increasing productivity will actually increase unemployment, not reduce it. This fear is, of course, understandable and we must
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face it head on and with understanding. We must make a great effort to explain the true position and the true factors at work affecting unemployment levels in this country, because although low productivity and over-manning may indeed save jobs in the short run, in the long run they make a whole company or a whole industry uncompetitive in world terms and therefore condemn a whole industry or a whole company to decline and perhaps even to extinction.
Take just the three examples of what has happened to British shipbuilding, the British car industry and the British steel industry. Can anyone doubt that these industries would be able to employ far more people than they are employing today if only their low productivity had not caused them to lose a substantial share not only of their overseas markets but also of their home markets? A recent study has shown that the 10 British industries with the highest growth in productivity since the war have all increased their employment. That is the lesson, that is the moral which we must explain, with great persistence, understanding and ingenuity, to the shop floor.
In more general economic terms we can see how our low productivity prevents us from stimulating our economy in order to increase employment. It is primarily because of our low productivity that when we increase consumer demand here at home we have such a strong propensity to buy imported goods rather than British-made goods. It is also primarily because of our low productivity that over a period of years we can keep British goods competitive in world markets only by a progressive, continuous devaluation of the pound, which in turn puts up the domestic cost of our imported food and raw materials, and therefore in turn is an important cause in increasing our rate of inflation compared with that in other countries.
It is true, of course, that the unprecedented and still increasing rate of technological development, and therefore I hope of productivity, means that many manufacturing and other types of commercial industries as well, will need to employ substantially fewer people in the future and that as a result we shall face increasing unemployment, unless—and this

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is the key to it—we can take up the slack by creating more jobs elsewhere. The vital point is that it is only if our industries match the productivity and efficiency of their competitors in other countries that these high technology industries will be able to employ as many people as possible themselves, and, even more importantly, it is only then, if they do match other countries in their productivity, that we as a country will possess enough national wealth to be able to afford to create the alternative jobs in the non-wealth creating services in both the private and the public sectors. Thus, however we look at it, we see that our bad productivity compared with other countries sets off the vicious circle of rising prices, rising unemployment and falling standards of living. It is literally only if we can halt and reverse our deplorable record in productivity compared with other countries that we shall break the vicious circle in which we are trapped and instead start a virtuous circle.
To set about improving our productivity ought I believe to be made the major objective of national policy and effort, the top priority of politicians of all Parties, of trade union leaders and of managers. How can we do it? What is the agenda for action? I do not want to enter into needless controvery across the Floor of the House in this debate. In fact I agreed with almost everything that the noble Lord the Lord Privy Seal and Leader of the House, said. What disturbed me, however, was, with respect, that I believe the Government are missing so many of the fundamentals. I do not doubt their good intentions, but the sort of policy they are talking about is a policy which is rather like a doctor trying to cure measles by rubbing out the measles spots and not getting down to curing the disease.
I do not disagree with the industrial strategy. Some of my colleagues may and some people in industry may, but I do not; nor, to be fair, do the CBI, for example, and many others. It is important but to imagine that that is the main engine by which we are going to reverse the trend of our productivity record is, frankly, to live in Cloud Cuckoo-land. The sooner we get out of Cloud Cuckoo-land, the sooner we shall have some hope of making progress.
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First, and above all, what we have to attend to is the use we make of our capital equipment. That is the source of wealth creation in a modern industrial society. The most commonly heard cry now and for years has been the need for more investment in industry. Of course that is important, but to a large extent that is a facile and false argument with little foundation in fact. Study after study shows that lack of new investment is not by a long way the major cause of Britain's low productivity. Still less is it caused by any lack of finance available for new industrial investment. These facts are clearly shown and closely argued in an important article by Mr. Joel Barnett, the Chief Secretary to the Treasury, which was published in the Sunday Times on 25th June, and any noble Lord who has not read it I hope will go to that article because, from the Government itself and a Cabinet Minister, it destroys the dangerous myth that all we want and need to do is to increase our investment.
The first and real need is to make better use of the capital equipment we already have. That is so fundamental it ought to overshadow all other needs, because if we could do that we should, among other things, be doing more than anything else perhaps to create the atmosphere in which both home and overseas industrialists would want to come to Britain and to undertake more new investment here. But study after study has shown that even with the equivalent or sometimes with exactly the same plant and machinery, productivity in British factories is far below that achieved abroad. Often it is only half what is achieved abroad, and sometimes much less than half. Sir Terence Becket, the chairman and managing director of the Ford Motor Company, recently said that—
"there is a chance of increasing our output by say 25 to 30 per cent. as a country. In my own company alone"—
that is, Ford's—
"with existing facilities and the existing labour force we certainly have that opportunity".
But what do we have to do to release that opportunity? Above all, I suggest that we must face up to the fact that we need to work our plant for longer hours.
The present levels of unemployment, and the fear of still higher unemployment threatening us in the future, make, and

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naturally make, trade unions and their leaders think in terms of work sharing. Fundamentally, I agree with that feeling. I am sure that this world is going to come to work sharing. Indeed, if that is not what technology leads us to, to less hours of work and more constructive leisure, I am not quite sure what it is all about. But it is the rate at which we come to it, and the manner in which we come to it, that matters. Above all, we in this country in our position certainly cannot lead the way. We cannot cut down hours compared with other countries and therefore still further weaken our productivity performance. The straight reduction in working hours that is being talked about at the moment as part of the prospective bargaining round next year would be disastrous.
Our guiding motto in Britain should surely be: Work our machines for longer hours and our people for shorter hours. That of course means more shift working, which I know is not popular, but I believe we have to look at it. I am not necessarily, in regard to most industries, referring to 24-hour round working. In some industries that is essential and is done already, but that is not what I am thinking of generally speaking. I believe that with imaginative planning by management and trade unions one can devise shifts that fit in well with modern life and leisure. When you have some money to spend—and our people nowadays, compared with the past, do have some money to spend, are educated to enjoy leisure, and have ideas about what they want to do—to have some weeks when you do not work in the mornings, and other weeks when you do not work in the afternoons and evenings, is not an unattractive way of life. I did it myself many years ago and, contrary to my expectation, I found it a very satisfactory way of life. It gave me much more opportunity for constructive leisure than I had with a normal working day.
We must look at the situation. One point is certain: more shift work would increase employment substantially and might well be applied in a considerable number of industries with the result of higher rather than lower overall productivity if we more effectively combine use of labour with use of capital equipment. It is quite clear, on the other hand, that
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a straight reduction of a single-shift working week would produce far fewer extra jobs in the short run while in the longer run it would create still higher unemployment because it would further worsen our competitive productivity record compared to other countries. Our comparatively poor utilisation of our existing equipment is by no means merely a matter of the total hours for which we nominally work it; it is also a matter of the amount of time for which our production lines stop, for one reason or another. In that, too, we compare unfavourably with other countries. One reason is our system of maintenance. This was brought out very clearly in the study published a month or two ago in the Sunday Times—a study of what happens in Ford factories in Britain and in Europe with similar equipment. It was shown to be the maintenance system and the working habits of maintenance men which had a very big effect. It was not only bloody-mindedness on the shop floor which had a big effect on the number of hours that our production lines worked compared with similar lines in the German factories and the Belgian factories.
Another reason, of course, is our record of frequent and unpredictable, even if usually short, stoppages due to industrial action that we have referred to in several debates in your Lordships' House during the last two years. I shall not go into it again now, except to say that we really must ask the unions—I am coming to management in a moment—to take a new lead in doing what Mr. Jack Jones has said in public on several occasions in the last two years; that is, finding ways of talking in rather than walking out.
It would be a fatal mistake to imagine that improving productivity is just a shop floor or trade union problem. It is not: it is very much a management matter as well. The working out of acceptable shift systems and the organisation of maintenance—the two matters I have just been talking about—are both matters in which good constructive management is essential. The most angelic reaction from the trade unions in these matters would be no good without good management leadership, first-class production planning and control, product design, to say nothing of marketing, purchasing and financial control systems, and the control and limiting of non-productive overhead ex-

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penditure, which are all essential ingredients of high productivity and are all primarily responsibilities for management and managerial skills. So, too, is the development of genuinely creative participation between all who work in industry.
In these matters the best in Britain may equal the best in the world, but I am afraid there is too much evidence that our average standards in these managerial skills may still fall below those of other countries. So in our campaign for higher productivity neither capital, management nor unions are in a position to sit back and point the finger of blame at each other. All are in this together and each part of industry has plenty to do. There are other important areas of action which I cannot go into today.
There is need for reform in our system of collective bargaining, which your Lordships debated in April; there is a need to increase the intake into industry of more and better trained engineers and technically trained people at many levels, which your Lordships debated a fortnight ago. There is the need to increase the understanding throughout the country of the value and vital need for wealth-creating activities and the regard in which industry is held, particularly by our best young people thinking ahead to the kind of careers they wish to follow. Your Lordships also debated that subject in February of last year.
Most of the matters to which I have referred in my speech require action within industry itself, by management and trade unions alike. They cannot be imposed by direct Government action and intervention; indeed they can be and are being impeded by excessive and wrong-headed Government interference. What I believe Government can and must do is to keep up a constant pressure on industry—on the CBI and on the TUC and on their constituent individual members—saying to them that it is their duty to put their own houses in order in these matters. Much of this pressure from Government and industry could, as I said in the debate on collective bargaining in April, be well done in private rather than something which might be seen as an attempt to pillory people in public.
I believe that the Government have that duty. What they have not got a duty to do is to try to do the job for
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industry and discourage and disenable industry from doing it themselves. The Government have their own direct responsibility and it is a vital one. It is to provide an encouraging economic environment. To change our ridiculous levels and pattern of personal taxation; to put first the reduction of inflation, as my noble friend said; to have greater stability of policy in this country. Industry will not flourish so long as policies change as frequently as has been common in this country since the war. The Government also have the duty to undertake a deliberate holding back for the time being of public expenditure on non-wealth creating services until our productivity, and therefore our wealth creation, in this country has been substantially improved.
The Government have as well the deliberate duty to abstain from cost-raising and productivity-reducing legislation. There has been too much of it already. The Government also have a duty to ensure that educational and training services and all forms of assistance to encourage mobility of labour between one job and another are further increased in scale, quality and relevance. Although we have made big strides in this country over the last 10 years in these respects, in my view we are still seriously behind what is provided in these matters by countries such as Germany, France, Sweden and many others. We must catch up.
Above all, the duty of the Government is political leadership, because although I have spoken mainly about the technical policy needs, the real requirement—and we all know it in our hearts—is to summon the national will. As the noble Viscount, Lord Amory, said, our present position is our own responsibility. It is our fault that we are in this present position, not the fault of others or of our situation.
I sometimes wonder—no doubt my noble friend Lord Soames may tell us—what other countries think when they see us making such a mess of our own affairs and daring to lecture them on what they might do. It is within our power to put our own affairs right if we have the national will, and it is the prime job of political leadership to create that national will. This requires speaking bluntly to our people about our position; not pretending and encouraging people to believe that failures are successes; not pretending that we are on the verge or in the early stages

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of an economic miracle when everyone else can see that we are not. It needs blunt speaking, but that blunt speaking needs to be combined with encouragement. I make my appeal to the political leaders of all Parties to unite in making this country realise that unless and until we raise our productivity to something nearer international levels we are fooling people if we promise them a better material life, and we are probably fooling them too if we promise them greater satisfaction in their way of living.
4.9 p.m.
Lord ROCHESTER: My Lords, from these Benches I should like to join in congratulating the noble Viscount, Lord Amory, on having initiated this debate, and to say how much we, too, are looking forward to hearing the maiden speech of the noble Lord, Lord Roll of Ipsden. It is in keeping with the wisdom and the experience of the noble Viscount, Lord Amory, that he should have gone straight to the heart of the matter in selecting low productivity as the most intractable of our problems, and the one that is the most important for us to solve. In particular, he has been right in his Motion not simply to have related productivity to employment but to have done so in a way which shows that he believes that new job opportunities will follow and cannot precede improved productivity.
Until five years ago my life was spent in the chemical industry, and indeed in a particular part of that industry, a particular company which I continue to feel is the finest in the land. I shall speak with that industry in mind, not simply because I have close knowledge of it—which I have taken care to try to bring up to date as far as possible in this matter of productivity in preparing for this debate—but because it has been a successful industry, and it is important that we should try to build on success.
In part, the success of that industry has undoubtedly been due to the way in which during the last 10 or 15 years leaders have steadfastly insisted, gradually and, therefore, painlessly, on reducing manning levels to match those of their competitors, in contrast with the failure of other industries so to do. What is the use of keeping too many people employed
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in a particular factory if later the whole works has to close? And is not that just what has happened during the same period, or may very well soon happen, in the car, shipbuilding, steel and other industries? Surely it is better, to put it at its lowest, in the long run to safeguard through improved productivity the jobs of the majority, than later to lose the jobs of all because overmanning has made a company or an industry inefficient and uncompetitive.
Even in the relatively successful chemical industry, in which in recent years the ratio of growth to other manufacturing industries' growth has been higher in Britain than anywhere else in the world, and productivity measured as sales per employee has risen at a striking rate, absolute productivity is still lower than that in other countries and we remain competitive only because we pay such low wages. If that is so in the chemical industry, how much more true is it of British industry in general?
Why is our productivity so low? Superficially, as has been said, it is due to a number of things: to restrictive practices on the part of trade unions, particularly, but not exclusively, on the part of craftsmen in maintenance work; to lack of adequate financial incentives for responsibility and skill; and no doubt also to failings of management. But, beyond these, I believe it is due primarily to two factors that are deep-seated: the fear of unemployment, and resistance to change It follows that if we are to solve the basic problem we must face up to these two things.
Supposing that productivity in this country were improved, would there be more or fewer jobs? In the particular firm or industry it seems to me there would clearly be fewer. More than that, in my view, in the future there are going to be fewer jobs in manufacturing industry as a whole. That does not mean necessarily that there are going to be fewer jobs available overall. On the contrary, the more that we increase productivity, and thus improve our competitive position in manufacturing industry, the brighter the prospect of generating more wealth in other sectors of the economy; the more profitable a company or industry becomes the more it can invest, this providing additional jobs elsewhere. For example,

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in the company for which I used to work the current investment programme is providing work for 40,000 people in the construction and engineering industries.
Still in the field of employment, I am sure that in his Motion the noble Viscount, Lord Amory, has been right to emphasise the need to stimulate job opportunities that are new, and here I am thinking particularly of service industries, operations like transport, communications, finance, entertainment, tourism and so on. These industries, too, create wealth, in supplying market needs, in producing profits that are taxed to pay for social services, in providing employment and earning substantial amounts of foreign currency. But there are great difficulties. The loss of jobs in manufacturing industry means that people will be redundant in particular localities where their skills cannot be matched by existing jobs in service or other industries. And here the Government, instead of concentrating, as must be the strong political temptation, on saving jobs in dying industries, must seek to create the conditions in which new ventures, and particularly small ones, including those co-operative enterprises that some of us were talking about in your Lordships' House recently, are encouraged to develop and to prosper.
Above all—and this was a point emphasised by Lord Amory—inflation must be reduced still further, and there need to he reductions in the levels of direct taxation on both individuals and companies, even if this means taxing more highly items that we may enjoy consuming but which by no stretch of the imagination can be called necessities. It may not be electorally popular to say this, but if we really want to solve this problem of low productivity rather than just talk about it, I believe that in the next phase of pay policy there ought ideally to be no increases in wages and salaries at all, other than those needed to correct the most blatant anomalies and to restore in part the erosions in differentials for responsibility and skill that have accumulated in the last few years.
But when all this has been said I fear that it may not be enough altogether to solve the problem. With so many more young people leaving school, with the effects on employment of the current
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developments, as the noble Lord the Lord Privy Seal was saying, in microelectronics technology and so on, it seems to me that in the foreseeable future at least there are simply not going to be enough jobs to go round, and that increasingly it is the least skilled and the most disadvantaged who are most going to get hurt.
I have reluctantly reached the conclusion, as I noted the noble Viscount, Lord Amory, and the noble Lord, Lord Carr of Hadley, have done, that at least at this stage in our development the answer is not to be found in reducing the length of the nominal working week; and I say that because all my past experience goes to show that those calling most loudly for that development will not be prepared in practice to accept the reductions in pay that would have to accompany it if productivity is not to suffer and unemployment to rise still further.
However, speaking for myself, but also in support of noble Lords who have before now canvassed this idea—I think that I am right in saying that the noble Lord, Lord Hunt, is one—I believe that one item that should be explored and costed, if it could be done with sufficient agreement among Members of all Parties and none, is some form of voluntary national community service. That, among other things, might give young people some greater sense of common purpose and of worthwhile endeavour than it has so far been possible to achieve, despite the valiant efforts of the Manpower Services Commission and others operating in this area. Obviously, the cost of any such scheme would depend on its nature. However, it occurs to me that some work may already have been done to estimate the cost. If, when the noble and learned Lord, Lord McCluskey, comes to reply—I have been able to give him short notice of this matter—he could give me any information on this point, for example, however roughly, what any such scheme might cost in comparison with, say, the Commission's new special programmes, then I should be most grateful.
I said earlier that in my view resistance to change was a further basic reason for our low national productivity. That is the factor which most sets us apart from our international competitors, and I think that it stems from the failure to recognise that we all share in the need to increase

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the size of the national cake before we start arguing about how it is to be sliced. How are we to surmount this handicap, which I believe to be self-imposed? In my view, it can be done only through better leadership and through long-term education and training—especially the training of shop stewards from which it seems to me that both management and trade unions stand to gain and in which they should therefore join together. My experience in this area leads me to suggest that in such combined activities there should be frank discussion of the problem from the viewpoint not of management, but of employees and their representatives, and that an analysis should be made of the obstacles which stand in the way of accepting improvements in productivity so as to establish whether they derive from fear, habit, poor communications, bad relationships or other factors—all that with the agreed aim of trying to work through the problem together towards a mutually acceptable solution.
I said that better leadership was essential to improve national productivity, and that calls for politicians to govern in the long-term national interest, for trade union leaders to display courage and for management, overtaxed and over-burdened with industrial legislation though it may be, as always to accept responsibility. Again from experience, I know that training in leadership can be given and that the most progressive of our companies find it worth while to spend a great deal of time and money in supplying that training.
I well remember that nearly 15 years ago, when my own old company made an agreement with the trade unions which, putting it in its crudest form, traded increased productivity for improved pay, conditions and status, that agreement had first to be tried out in certain factories. I remember that when in one of those factories it was finally successfully implemented, the works manager said to me that he thought that the factor which had most contributed to its success was the training of management and supervisors, not in technical matters but in the management of people.
I recall also the main elements in that training as the agreement of which I speak came to be extended to other factories.
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The main elements were as follows: training to improve productivity through what might broadly be called participative management; training in the formulation of objectives that were clearly defined, understood and, as far as possible, accepted by those who had to fulfil them; identifying and making use of the talents of all the people in the team; training in leading group discussion in finding some systematic approach to problem solving; identifying the factors that would improve the motivation of the workforce—matters like responsibility, achievement and the recognition of achievement and the need to build those into the jobs of the workforce; and, finding from painful experience what was the effect of personal behaviour on other people. In short, it is all those things which are needed if one is seeking not to manipulate. but to produce through consent changes in the attitudes of people.
I share very much what has already been said by the noble Viscount, Lord Amory, and the noble Lord, Lord Carr of Hadley, in that I believe that it lies in our power to improve our productivity but, in the last resort, as they have said, it is a question of whether or not we have the will in the national interest to do so. I fervently hope that this debate achieves wide publicity and that in some measure it does, indeed, help us to find that will.
4.26 p.m.
Lord ROLL of IPSDEN: My Lords, since I had the honour of becoming a Member of your Lordships' House, I have let perhaps an unusually long time elapse before venturing to participate in your Lordships' debates. I have hesitated despite the indulgence which I know your Lordships always show to a newcomer and which I trust will be forthcoming this afternoon, because it has seemed to me that in those matters on which I might hope to make a contribution to your deliberations—economic and financial matters—it is becoming increasingly difficult to obey the traditional injunction to a maiden speaker to be both brief and non-provocative.
However, when I saw the Motion proposed by the noble Viscount, Lord Amory, under whom I had the privilege of serving when he was Minister of Agriculture, I decided that, despite the constraints on a maiden speaker and the

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collateral hazards, I would try to make a few remarks on a subject which is clearly of surpassing importance for our economic future. It is moreover one which seems to me, despite the uncertainties which surround it—or perhaps because of the uncertainties which surround it—to be peculiarly fitted for a dispassionate approach. I do not believe that a facile diagnosis will serve, nor treatment by nostrum; I fear that there is no panacea for the multifarious manifestations of this particularly insidious disease.
Not that all sectors of the British economy are afflicted by it. Reference has already been made to agriculture. I should like, if I may, to add my voice on this subject to that of the noble Viscount and the noble Lord the Leader of the House, because agriculture is often overlooked in this particular context, but it is clearly an example of a very remarkable productivity record. It also seems to me one where one very difficult relationship—that between the market and the State—has been resolved in an effective manner; one which alas! has not always been possible quite so effectively or harmoniously in other respects. Of course, in agriculture too we need the market mechanism; we need the spur to efficiency and to lowered cost which competition provides. But we also need security of supply in peace and war. This requires economic security for those working on the land and, incidentally, as has already been mentioned, the great contribution to civilised values which a prosperous countryside can make.
Therefore, I doubt whether even the most ardent advocate of the free market mechanism would deny the vital role which the great Agriculture Act, 1947 and its worthy successor 10 years' later—the Act for which the noble Viscount, Lord Amory, was responsible—made to the productivity in our agriculture which, as I hope is now well known, has grown over many years at a much faster rate than it has on the Continent. I am not saying for one moment that what has been done in agriculture can simply he copied elsewhere. But I am quite sure that the noble Viscount, Lord Amory, the noble Lord the Leader of the House, the noble Lord, Lord Soames, and the noble Earl, Lord De La Warr—all of whom have had ministerial responsibility for agriculture—will agree that if by one
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means or another we could achieve in manufacturing industry the relative level of productivity which we have in agriculture, our fortunes would be greatly improved—at least in relation to our competitors on the European Continent.
Thus, it is in manufacturing industry that our real problem lies. Here I do not have much to add about the facts of our situation to what has already been said by the noble Viscount and other noble Lords who have spoken so far. Many of these facts are now widely known, thanks to an increasing volume of very serious economic research which has been stimulated by, and which has, I think, in turn greatly served, an increasingly active debate concerned with public policy in regard to this problem.
Since the work of A. T. Jones, which was published last year in the Economic Review of the National Institute, I think that we have all become distressingly familiar with international comparisons of labour productivity. These show rates of increase in the two decades, 1955 to 1974, in continental countries of between 170 per cent. and 230 per cent., against for the whole period, at best, a stationary situation in our country. This is especially significant when we recall that our productivity was measurably higher than that in France, Germany and considerably higher than that in Italy at the start of that period.
Unfortunately, the total picture does not look any better when we make a closer comparison of specific industries, or when we look at companies operating in a number of countries, such as the multi-national companies mentioned in the course of this debate. The report on the automobile industry, which was prepared three years ago by the Central Policy Review Staff—to which the noble Viscount, Lord Amory, has already referred—showed that although wages were often higher and although in all cases total labour costs were higher in other countries, the number of vehicles produced per employee-year was not only substantially higher in the United States, which we would have expected, or in Japan—though 20 years earlier this was certainly not the case—but also significantly higher in Germany, France and Italy. I regret to say that it is the current experience of companies operating, for

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example, both here and in France that this state of affairs continues, sometimes in respect of the production of identical models.
Of course, the picture is not uniform. A comparison of annual rates of growth of labour productivity in all manufacturing industry as between Germany and ourselves is uniformly unfavourable to us in each quinquennium since 1954. But there are some industries in which the discrepancy is very small and, indeed, there are some in which the discrepancy is in our favour. Naturally, faced with this problem one seeks an explanation by trying to identify other differences in the industrial and economic circumstances in which we find ourselves and those of our principal competitors, which could somehow account for these great differences in performance. A large number of these have been adduced from time to time. For example, differences in the relation of the volume, as well as the up-to-dateness, of capital equipment to the size of the work force, differences in the size of plants, differences in the length of production runs, differences in management practices and perhaps, above all, more recently, differences in industrial relations.
Our arrangements for vocational training before, and perhaps more significantly during, employment, have also been compared unfavourably with those of Germany where, as we all know, there is a compulsory system of vocational training on the job. Each of these factors can, in one instance or another, offer, if not a complete explanation, at any rate an important part of it and may therefore lead to appropriate remedies. But some baffling features remain.
Some highly interesting work is being done at this moment by Professor Price at the National Institute, which is comparing the relation between productivity and plant size in Germany, the United States and Britain. Unfortunately, this, too, as far as the initial results go, seems to dispose of any simple explanation. Thus, in some light industries—such as brewing, tobacco or biscuits—our plant sizes are not only generally not smaller, but in some instances even larger than those in the other two countries. Yet the productivity comparison is still generally very unfavourable to us. This is so, as we
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know, in the case of the other countries' heavier industries—for example, steel, chemicals, automobiles—where plant sizes are medium or large.
Again, as far as industrial relations are concerned, I think it is well known that the total number of days lost through disputes in the United States is in most years generally considerably higher than it is in this country. But the difference is that whereas our record is particularly good by comparison with the United States' record in small plants, it is immeasurably worse in the case of large plants, and it is precisely in those mass production industries where productivity is particularly unsatisfactory and where international competition is most acute.
With this multiplicity of factors to be taken into account, it is not surprising that many commentators have tended to look for what nowadays are called "macro-economic explanations". and "macro-economic remedies": exchange rate policy, fiscal policy, monetary policy, and so on. One eminent Japanese economist, Professor Tsuru, for example, has made his country's "economic miracle" depend to a very important degree on the fact that at a very early stage after the war the Japanese consciously adopted on exchange rate policy deliberately designed to direct their economy decisively towards exports.
All this is a very contentious area into which I certainly must not venture today. I shall only say that it is worth remembering de Mandeville's dictum of 250 years ago:
"Let the value of Gold and Silver either rise or fall, the enjoyment of all Societies will ever depend on the fruits of the "Earth"—
and today we might add "and the North Sea"—
"and the Labour of the People".
I do not for one minute decry the importance of macro-economic policy. Bad economic policy, whatever that may be, may erode and eventually completely destroy highly productive industry. Good economic policy, whatever that may be, is therefore essential. But in my view it will be of no avail in the end if the factors that make for high productivity are not tackled. The noble Lord the Leader of the House has referred to the work being done by the "Little Neddies" and the

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sector working parties in the general context of the Industrial Strategy. I agree that these have the promise of making an important contribution in at least one way in which it can be made to have lasting effect; that is, by patient, detailed, specific effort in which both sides of industry are deeply involved. But the task remains formidable despite that. Therefore, there is all the more reason to set about it with vigour and without delay. We must, therefore, all be most grateful to the noble Viscount, Lord Amory, for having given us this opportunity of reminding ourselves of what lies before us.
4.41 p.m.
Lord McCARTHY: My Lords, it falls to me to begin by offering congratulations to at least two of the previous speakers; first of all, to the noble Lord, Lord Roll of Ipsden, on his maiden speech. I can only say to him that he need not have waited so long before speaking to us because he managed to combine brevity, clarity, and absence of superficiality, and I hope it will not be so long before he speaks to us again. I hope, however, that next time he speaks after me, because when he has spoken there really is so little to be said. Nevertheless, we have many more speakers and we have to press on.
Secondly, I should like to congratulate the noble Viscount, Lord Amory, for initiating this debate. It seems to me that his speech fell into three parts. There was the part that no man could disagree with, and I do not disagree with that; there was the part that only an unreasonable man could possibly disagree with, and I do not disagree with that; and then there were one or two things where I think he got it wrong. I should like to start with the first two parts, where no man could disagree and only an unreasonable man could disagree.
It is clearly correct, as has been said by virtually all the speakers in this debate, that we have dangerously low levels of productivity in this country, and they are dangerously low in relation to our major competitors. It is also quite clear, in very broad terms—and there is a considerable body of literature, some of which has already been mentioned—that output per man is twice as high in the
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United States as it is in this country, and 50 per cent. higher with most of our major European competitors. In very broad terms this is true, and quite clearly it is something which, if it continues indefinitely, or indeed, if it continues much longer, is extremely serious for us.
The question is, why this should be so, and how we can apportion the blame for it being so and for it continuing to be so. I am pleased to note that in this debate this afternoon the major cause has not been found in systematic overmanning. Nobody has said that it has been systematic overmanning—systematic in the sense that it is deliberately, consciously planned and organised, for example, as a result of trade union activity—which is at the bottom of this problem. Nevertheless, there is overmanning.
There is overmanning in terms of international ratios, and in terms of any objective standards, and there is overmanning in many of the areas where trade unions are strong. But, as many international and national studies show, there is also overmanning in areas where trade unions are weak, or even in areas where trade unions are non-existent. There is considerable overmanning, for example, on the white collar side. There is considerable overmanning among foremen, among supervisors, and some studies indicate that there is considerable overmanning among management itself in international terms.
Most studies show, and have in fact shown since the war—the Anglo-American productivity studies, the NEDO studies, studies which have been mentioned in this debate, and the studies of Pratton and others—that roughly 50 per cent. of the difference between productivity levels in this country and productivity levels in our major competitors, is not really related to even the broadest form of overmanning, in the sense that this is something consciously and deliberately, or even unconsciously, operated autonomously by the labour force itself.
It derives from a complex series of managerially rooted reasons: from various kinds of organisational malfunction. Short runs, diverse product mixes, absence of cost control, defective rectification procedures, all kinds of different organisational malfunctions, including that most common of all, which was mentioned by the noble

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Viscount, Lord Amory, and is called in the car industry an "absence of bits"; an excessive amount of "down time", or waiting time; an absence of the appropriate mechanical means to carry forward production, which many studies have shown is in some ways the single most marked contrast between the production processes in this country and the production processes in many of our major competitors.
Now if we ask ourselves what can be the reasons for these organisational malfunctions, the answer which is frequently given—and I am bound to say it has been given to some extent from the other side of the House today—is that it derives from an absence of incentives; and, particularly since we are talking about managerial efficiency, it derives from the absence of managerial incentives. It derives, in particular in recent years, from the compression of pay structures from which we have suffered as a result of a series of incomes policies; it derives from excessively high taxation; it derives from Government interference with entrepreneurial freedom; it derives from a whole series of things which mark this country out at the present time, and have to a broad extent marked this country out since the war, from the situation which appertained in this country in the 25 years or so before the war, and of course in most of the periods before that, and particularly the 25 years before the First World War.
These were periods when there were much wider differentials, much lower levels of taxation, much less Government intervention, and of course much lower levels of investment and much lower levels of productivity. The remarkable thing is not that our productivity is low in absolute terms, and certainly not that it is low in historical terms because in historical terms we have in the 25 years or so since 1950 passed through a most remarkable period of sustained increases in activity. The remarkable thing, as the noble Viscount, Lord Amory, has said, is that in relative terms in comparison with our major competitors—all of which have been passing in the post-war period through a period of quite high Government intervention, quite high levels of Government taxation, periods of incomes policies, in many ways similar to ours—our competitors have been able to combine
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these things with higher levels of productivity improvement than we have been able to do since the war. So this is the problem that we have to solve.
One suggestion, if we dispose of the notion that it is due to a simple lack of incentives, is that we face a situation in which the great majority of the British workforce—including the management, because they are part of the British workforce, the supervisors, and the middle management—really like this rather easy-going, slow, stop-go kind of production process, that it is part, in fact, of our way of life. There may be something in this argument.
The problem with this argument is that, even if it be the case, it is doubtful whether the British workforce, in its broadest sense, has not only thought through the fact that it is consciously and, in a way, deliberately selecting this way of life, but that it is also rejecting the alternatives and taking on board the consequences, in the medium and long run, of continuing with this kind of way of life. So that even if this is an argument, even if we face this kind of problem which is, in a sense, a conscious choice for a particular style of easy-going production system, we have to struggle against this and point out the consequences.
I personally do not believe that we can say that it is simply a feature of this kind. It seems to me that most of the people who have spoken in this debate have mentioned a complex series of social, political, and economic factors, quite apart from any cultural disposition on the part of the labour force itself, which go a long way to explain what we are seeing in this country. I will simply add an extra one, one which has been raised before but has not been given sufficient importance. In this country we are addicted to what may be called a concept of occupational or task-oriented excellence, as against what many of our competitors have, namely a concept or organisational or resource-oriented efficiency.
It can be seen most clearly if one discusses the position of the average British craftsman, who believes that efficiency consists of him carrying out his historical, traditional, occupational tasks with the greatest degree of excellence and precision that he has been trained to do.

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Therefore he insists on having a mate, because one does not know a man is a craftsman unless he has a mate; that is part of his occupational identity. He insists on a full apprenticeship, because one does not know he is a skilled man unless he has been through a full apprenticeship. And if, when he is on the job, he is not required to use one tenth of those skills, that is management's fault; it is management not being able to use his occupational task-oriented excellence. He insists on producing whatever he is required to produce to the ten-thousandth of an inch standard he is capable of producing, even if all one needs is for him to produce ten times as many bits to one-thousandth of an inch—because to ask him to work in that way would be to deny his notion of occupational excellence, which has very little to do with the manager's notion of organisational efficiency.
I mention this in terms of the traditional craftsman because people find it easy to take on board the concept of occupational excellence when we talk about craftsmen. However, I suggest that the notion of occupational excellence is virtually universal in this country. It is, for example, extremely strong in the higher reaches of the medical profession. Anyone who has sought to organise and use the resources of doctors and make the most effective use in the National Health Service of their true skills knows that the notion of occupational excellence there stands in the way of the notion or organisational efficiency.
It is, I suggest—dare I say it in this House?—very close to the heart of the great British Civil Service. It is one of the main reasons why the Civil Service always resist any change in their promotion system, or any change to introduce specialism—sticking to one's last—because that is contrary to the notion of occupational excellence, which I suggest is a mile away from the notion of organisational efficiency.
In case anybody should consider that I am doing some special pleading, let me say that I consider the notion of occupational excellence is one of the main reasons why we have the lowest form of input-output ratio in British universities of any university system in the world. Thus the notion of organisational
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efficiency needs to be stimulated, not simply in industry and not simply among management, but in this country in general. The problem is how to do it.
A great deal is often said about the enormous efforts that were made in this country during the war, a period in which we raised our level of productivity in the most remarkable way. I suggest that was a period when the notion of organisational efficiency was allowed to become more important than the notion of occupational excellence. Because people could see the reasons why they should co-operate in raising efficiency and putting aside all their traditional concepts of what their own occupatoins required, that was one of the main reasons why we were able to raise productivity in the way we did during the war. It is also one of the main reasons why it has not been possible to sustain it; it is extremely difficult to sustain that kind of feeling for a long post-war period.
Despite what has been said from the Benches opposite about leadership, and what has been said or may later be said about patriotism, I do not believe that a return to that kind of approach or appeal would do much to resurrect the notion of organisational efficiency. It is also clear that we cannot legislate for it; it is not the kind of thing one can do by Act of Parliament. I used to believe that we could do it by education—that we could set up management schools in which we could preach the virtues of organisational efficiency—and I still believe that to some extent, but I am concerned about the fact that so many of our management schools require academic respectability, and so they are seduced into the notion of academic excellence, which usually means that they must talk in incomprehensible language and produce all kinds of knowledge which is not much use to the practising managers who go there.
In other words, I am not very certain about inspiration, about legislation, or about education. I think something can be done through the Government's industrial strategy if the aim of that strategy, and the money they spend and the support they give, is not simply designed to give support to particular industries or firms but to particular men. If the industrial strategy could become so organised that we were looking intelligently

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for the right men to put in charge of the right enterprises, then that strategy would have an important rôle, but once again we must say that the record of the bureaucracy in the Civil Service in selecting the right men to put into the right risk operations is not all that good.
I come, finally, to the force of example; we might be able to do something by the force of example. If we were to look at the political system, at our own procedures and ways of running Government and Parliament, and if we were to ask ourselves whether we do not give too great an emphasis to and focus on occupational excellence rather than organisational efficiency—in other words, if we were to set an example to others—I think we should produce some very substantial changes in the way this House is run. I do not see how the concept of organisational efficiency can possibly be compatible with such ancient traditional notions as Question Time and late-night "Lobby fodder". Of course they are dear to the heart of occupational excellence, but without some force of example I do not think we have much right to call on others to change their ways.
4.58 p.m.
Viscount ECCLES: My Lords, my noble friend Lord Amory has put us in his debt by introducing, by one of his wise and calm speeches, a debate on a subject which is stormy with emotion. We are also in his debt because he gave the opportunity to the noble Lord, Lord Roll of Ipsden, to break silence, and I am sure your Lordships will agree that when he comes to make a controversial speech we are really going to hear something, because his non-controversial speech must have been one of the clearest and most interesting we have had for a long time.
I find this a very difficult subject to talk about because I am ashamed, as I dare say many other noble Lords, are of the record of British performance, and I do not like to be ashamed of my country in any way. I think we can agree on the major facts, but whether we are going to agree on the share of responsibility which each of us undoubtedly has, and the share of our political
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friends as well, remains to be seen. I can start with something about which we can surely be in agreement, namely that the productivity in the engineering and metal-using industries in this country compares very badly with the productivity in the same industries abroad.
Lord Amory said productivity was unsatisfactory in other sections of the economy. That may be so, but the comparisons with other countries are much more difficult to make; we can measure the failure in engineering, although I do not wish to trouble the House with many statistics. I just ask why, when someone, early last November, ordered a British motor car of a well-known make, he has still to wait for delivery? Why is it that when we want to get something repaired it is often so difficult to get hold of the spare parts? It is those kind of things that prove to the ordinary public that our productivity is poor.
I was very interested when my noble friend, also the Leader of the House, and also Lord Roll of Ipsden, compared manufacturing productivity with the good record of agriculture, and gave figures, which I shall not repeat. The reasons for the success of agriculture, and certain features which mark it out from manufacturing, are worth examining for a moment or two. The units of production are small and manageable; the farmer I and his men know each other and are able and willing to do all kinds of jobs as occasion arises. There has not been any trouble about new machinery which required a reduction in the labour force. And so in agriculture we have small units, flexibility at work, openness to innovation, and a stable market for the products. In greater or less degree all these characteristics are absent from large-scale manufacturing.
Perhaps there is a further reason for farming's good record, not much talked about, but which your Lordships may think of some significance in the context of this debate. The farmer is not a salary earner. His reward is his profit after tax. He has many expenses which he can legitimately set off against his tax—allowances which are not available to an industrial manager on a salary. And so—and I know it myself—if a farmer can earn a larger gross profit the chances are

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good, even under a Labour Government, that he can keep substantially more for himself and give bonuses to his men. The financial incentive is still there. The financial incentive is not there in industry to anything like the same extent, and productivity suffers as a result.
Returning to engineering, the outlook is depressed. Certainly it is very depressed compared with agriculture. By and large, our manufacturing industry is on the defensive. Profits are inadequate and the British share in world markets, for example in engineering goods, has gone down, is going down, and most managers and workers see no prospect of it ever rising again. In those circumstances, can we wonder that young men do not become engineers? They have seen for themselves that those who represent the workers in the industry would rather share out the work that is going than make a serious effort to raise productivity. Of course, for a short time our depreciating pound conceals this fundamental weakness. But now work-sharing in this country has reached the proportions of a national disaster. Far more production is lost by deliberately going slow than by all the strikes we hear so much about. That is a fact. But one wonders whether the unions accept it. One understands why not, if they do not, because work-sharing is a human aim. It springs from a deeply-felt concern for one's fellow workers. I can imagine nothing worse than to be unemployed. But, as practised by unions today, work-sharing is acting like a drug that reduces the pain but progressively weakens the body on which the future level of employment and our standard of life must depend. We are, if you like, in certain industries, committing slow suicide.
Unfortunately in this country the tradition of work-sharing, which is very deep, and goes beyond unions right through the country, has been joined to the political doctrine that capitalism must be smashed because it is believed that profits are made at the expense of the workers. I remember the late Lord Feather—for whom I had a great personal regard, as I think did all of your Lordships—about 15 years ago saying at St. George's House, Windsor, that conflict between management and labour had been, and would remain, the one sure road to progress for the workers. As long as the view is held that conflict is
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essential to progress, we should not be surprised that so many members of trade unions think it right to do less work for more money. In a struggle to secure the downfall of private enterprise—and we can see that happening in Fleet Street every week—productivity is bound to be a foremost casualty. Any Western country which does not follow this policy will continue to outstrip us in world markets.
The Motion mentions other countries. It is interesting to look at the attitudes of their trade unions to this problem. Are they the same as ours? In France, it looks as though labour conditions are becoming rather more difficult. But the edge is taken off the conflict with the employers by the bitter quarrel between the big unions themselves, so we do not find the trade unions in France so single-minded to push their economic and political objectives. In Germany, the unions are much more part of the establishment than they are here. German unions are industry-wide and, since there is usually only one in each factory, agreements on productivity are easier to make and much easier to stick to. In the United States the unions are not interested in politics. They have never encouraged their members to look forward to the end of capitalism. They have always seen that high wages and high profits go together. If you want the one, then you must also have the other.
From all these comparisons it seems to me that one point stands out. In Britain our unions have a much stronger tradition of sharing work and are far more skilful at doing so than are the unions in any other country. Naturally, an attitude of that kind costs us much more in a period of recession. Remembering the contrast between the conditions in agriculture and the conditions in engineering, what can one say about the quality of British management? I agree with my two noble friends who have spoken on this, that sometimes it is very good, but by no means always. We should recognise that, and recognise that it is a large contributory factor to low productivity.
The weakness in design and production engineering has been mentioned. One purpose of design is to make a more acceptable product with less labour. Where 40 nuts and bolts are used, given a better design only 20 are needed. But if

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the attitude of the work people is that labour is not to be reduced, then why bother about a new design? Why not, like the TUC and the Cambridge economists, press the Government to introduce measures of protection against imports, so that our overmanned and low productivity firms may be cushioned? On production engineering, my impression is that we do not always organise the work well enough to get as much output with the same equipment as do some of our competitors.
But worst of all, the private sector has to carry the burden of an ever-growing and ever less efficient public sector. The consequent weight of taxation, and the vast borrowings of the State, cripple industry at all levels, and certainly put a brake on productivity. As your Lordships know, men are like donkeys; if they feel that they are overloaded, they stand stock still and refuse to budge, unless some part of their load is taken off them. Taxation in this country has passed the point where the load is tolerable, and so productivity suffers because many people do not see the point of doing any more work.
I often wonder that people do not see the connection between an incomes policy and low productivity. If there is nothing for anyone to go for beyond 10 per cent. or whatever, the Prime Minister's new ceiling may be, two things must happen. The first is that differentials must be further squeezed; so why bother to learn and practise a difficult skill? The second is that under an incomes policy, however efficiently anyone works, he will get only the same rise as someone who has never had the slightest intention of working any harder. If that does not put a brake on productivity, I cannot imagine what would. All the arguments for an incomes policy with the same ceiling for everybody are short-run arguments concerned with the immediate need to arrest inflationary wage claims. But we shall never cure inflation by means which encourage low productivity; and this must be the result of uneconomic work sharing, and the absence of incentive for skill continued from year to year as official Government policy.
What can we do, having regard to the awful problem of unemployment, which is not going to go away? I believe that
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we should maintain a high level of unemployment benefits, but obviously the first requirement is to run the economy better. It is not necessary to repeat all the mistakes that Governments have made since the war. Governments need not overspend and inflate the public sector to the extent that requires them to borrow £500 million or £600 million a month. Governments should have set an example in not overmanning the public services. They should have increased incentives to those who can create new jobs. As it is, anywhere outside the City of London one finds that the British economy is considerably depressed.
Only last week a very intelligent graduate, who has a very good degree, said to me, "What a choice I am faced with—either I go to America and try to make a fortune, or I stay here and become a civil servant, safe and satisfied with an indexed pension and a little power without much responsibility". How do we change that young man's attitude? How do we change the union's attitudes towards work sharing, which are leading us on to further poverty and further unemployment? Of course it would be easier to start a change in attitudes if the economy were better run than it is today. I still believe in a not impossible future, in which we all pay more attention to getting on with each other and producing more, rather than spending money that we have not got. I must finally admit that the pessimism today runs very deep, and such optimism as I have, I must also admit, depends on the result of the next General Election.
5.15 p.m.
Lord PLOWDEN: My Lords, it gives me great pleasure to be able to congratulate the noble Lord, Lord Roll of Ipsden, on his thoughtful and constructive speech. He and I were colleagues many years ago as civil servants, and I learnt then of his high intelligence and wide-ranging mind. I hope that he will speak often in your Lordships' House. I must apologise to noble Lords who are to speak later in the debate for not being able to be present to hear all of them, but I am to be host at a dinner, the date of which was fixed over six months ago.
Productivity is a subject that has been debated ever since the last war. It was,

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I think, Sir Stafford Cripps who, as President of the Board of Trade, set up the joint working parties of trade unionists and managers to go to America to see what we could learn about productivity in the United States. Since then there have been many studies, visits and so on. The only point on which I think everyone is agreed is that our productivity, when compared with that of our main competitors, is too low. Disagreement comes when we try to find out what causes it. There are, I suspect, four main causes that are in the minds of people: low investment; bad management; Government policies; and the fault of the trade unions. I wish briefly to look at all these four.
First, I wish to take investment. Of course we all want more investment, but perhaps more important than getting more investment, is to use more efficiently the investment we already have. Sir Terence Beckett, the chairman of Fords, to whom I spoke last week, authorised me to say:
"In Fords' experience productivity per man in Germany is one and a half to two times as great as it is here, using comparable plant and machinery, and making the same kind of motor car".
The chemical industry, which is one of the most efficient industries in this country, has the same experience. In making comparisons with Europe it found that productivity per man is about 30 per cent. higher than it is here, while in the United States it is about twice as high.
Secondly, I shall deal with poor management. There are far too many badly managed firms in this country, and all of us in industry could name a number without much difficulty; but there are also far too many badly managed firms abroad. However, we seem to be slower at putting them right or allowing them to go bankrupt. There seems to be a tendency to hope that things will get better, rather than to grasp the nettle. We have our fair share of good and bad managers; and undoubtedly we need more good managers. All of us—industrialists, trade unionists, and politicians—should, as the noble Lord the Leader of the House said, support the various initiatives started by the Secretary of State for Education and by various organisations, to persuade the teachers and academics that education has to be
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relevant to the needs of society, and that in commerce and industry there is an opportunity of worthwhile careers for more of the better brains that are being turned out. I know from experience as an industrialist that good managers in British industry are just as good as those elsewhere. If we need any confirmation of that, it can come from the activities of the headhunters who are always trying to seduce the best ones away in order to go abroad.
I can illustrate, I think, from the experience of my own company. Some years ago we bought a company on the Continent which was making losses, and we sent three young men there who had first of all to learn the language. In two or three years they turned that company round into making profits, and it is continuing to make profits. I do not think that any of those three young men would claim that they were geniuses: they were good managers of a kind of which there were others in the company which employed them. But a great deal of the energies of our managers, as has already been touched upon by some noble Lords, are devoted to dealing with labour problems and problems that follow from them. Sir Terence Beckett says that, in the Ford organisation, line managers in the United Kingdom devote anything up to three-quarters of their time to labour problems and about a quarter to solving the problems of production and planning better productivity, and that on the Continent it is the exact opposite. This, again, was found in much the same way by the chemical industry when they compared the conditions here and in Germany. All this falls most heavily on middle and junior management.
Thirdly, Government policies. Successive Governments, of both Parties, have done a great deal to try to promote investment and to improve productivity. Indeed, we probably have the highest and most extensive investment incentive schemes in the developed world; but, as the noble Lord the Leader of the House said, what is lacking is stability. There are too many changes; all the schemes are changing. I will not weary noble Lords with the number of times that purchase tax and VAT on durable consumer goods has changed since the war, but it is a great many; and it is an inhibition to more investment and increasing capacity. There

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is an excessive number of regulations which bear particularly heavily on smaller firms. It is better now, but up to quite recently the difficulty in getting industrial development certificates in areas like Birmingham really has inhibited growth; and we have seen some of the results in that area now. High taxation has undoubtedly inhibited innovation by individuals and growth in small firms. It is absolutely essential that, if we are going to provide jobs for those people displaced from declining industries—and they are already being displaced—we have got to foster innovation and the development of small firms, because that is the only way in which we shall get growth in employment.
Finally, labour relations. I do not think anyone could deny that recent legislation has greatly increased the strength and the power of the trade unions vis-à-vis management; but, over and above that, the complexity of our industrial processes today can so easily be disrupted by quite a small group of workers. It is the failure of trade union officials on so many occasions to control their members and to insist that they abide by the agreed procedures for settling disputes that has been so disruptive. It is not weak trade unions; it is strong and responsible trade unions that are needed.
None of this is to suggest that the British strike record is the worst in the world. In 1976, the number of days lost per thousand employees was better in this country than in Canada, Australia, Italy or the United States, though it was worse than in France and Germany. Moreover, only 2 per cent. of manufacturing units were affected by strikes. But strikes in this country, particularly unofficial ones, are more disruptive of production than strikes in competitor countries.
As industrialists, or even as newspaper readers, we all know of the overmanning, the restrictive practices and the inter-union rivalry which exists in certain industries. This malaise, as certain noble Lords have already said, is much greater in large firms than in small ones. Indeed, Sir Terence Beckett said in a lecture recently, that two of the small Ford units in this country were more efficient than their comparable units on the
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Continent. Furthermore, various noble Lords have called attention to agriculture, and the noble Viscount, Lord Eccles, pointed out that this is where you have a close contact between manager or owner and man. The same thing happens in small firms, that you get better relations and, I claim, better productivity.
Now, what should we do? I think it is most important that we all, particularly management, recognise that the attitude of men and women on the shop floor and in offices has changed, and is changing. When I worked on the shop floor before the war one did what one was told at once and without argument; but, today, people want, and rightly want, to have a say in what affects their daily working lives. They want to participate; they want to be involved. We all know from the opinion polls, and best of all from our experience if we are in industry, that most people are indifferent, or even hostile, to two-tier boards, worker-directors and all the paraphernalia of Bullock and quite a lot of the recent White Paper on Industrial Democracy. To some, including myself, most of the proposals seem to be about trade union power, and not about democracy; and many trade union leaders appear to share these misgivings.
My Lords, if we are to meet the aspirations of the people who work in industry and commerce, we must make a reality of participation. It is something that must be built up step by step, and which will happen only if management really sets out to make it a reality. It is something in which all members of a firm, whether or not they are trade unionists, must take part. The arrangements must be formalised in all firms larger than, say, a certain size—perhaps 2,000 employees. There must be a code of practice; and there must be back-up legislation so that either side, if they are dissatisfied, can apply to a special agency whose duty it would be to ensure that proper participation arrangements were brought into effect if the majority of the employees in a firm voted for it. I believe that participation agreements, flexible and tailored to the needs of individual firms, are critical to the good performance of the business and to the satisfaction of the people who work in it. They can, I believe, be a major factor in securing a shared commitment to the success of the enterprise; and,

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by better understanding, lead to improved productivity. The major responsibility for this rests on management, but—and it is a very important "but"—there must be an acceptance of change by the members of the workforce who work in industry.
5.29 p.m.
Lord LEE of NEWTON: My Lords, like the noble Lord, Lord Plowden, I, too, have an engagement later. In my case it is with those engineers who have been discussed so much today. I hope to get back before the winding-up speeches, but there is no lack of courtesy in my leaving. My Lords, I join other noble Lords in congratulating the noble Lord, Lord Roll of Ipsden, on his maiden speech, which was so clear. It was was an excellent maiden speech, and one which I thoroughly enjoyed. The noble Lord, Lord McCarthy, who followed him, said that he found it difficult speaking after him. After what Lord McCarthy said about civil servants, I think it would have been very interesting to all of us to have heard the noble Lord, Lord Roll, if the noble Lord, Lord McCarthy, had spoken before him. I see present a number of eminent ex-civil servants with whom I have had the pleasure of working. I do not think that they deserve some of the things that have been said about them.
May I also congratulate the noble Viscount, Lord Amory, on introducing this subject. It is a subject which those of us who have inhabited both Houses since the end of the war are not unfamiliar with. I should have thought that it was a subject that we have debated more than any other single subject that we could possibly discuss. On many occasions I have ventured to offer my own views on the economics of all this in both places; and I have begun to wonder whether the problem is purely an economic one or whether, in part, it derives from an attitude of mind. One reads in the newspapers, sees on television and hears on the radio newsreels, a series of accounts of unmitigated gloom about the prospects for the British economy. Indeed, if I may say so in the presence of my noble friend Lord Kaldor, last week we had a further dose of gloom from the very pessimistic forecasting of economists at Cambridge University concerning the project in the Department of Applied Economics. They
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seemed to come up with the dismal prospect that, even if we took such reflationary action as to cut the standard rate of income tax from 34 per cent. to 20 per cent., or if we abolished the whole of VAT, we should still have 2·7 million unemployed by 1985 and that that would not prevent the virtual collapse of the vehicle and engineering industries.
This is a remarkable prospect (is it not?) to expect millions of working people to accept that which we all know to be true: that only by increasing productivity can we obviate the dangers that we all know are present. Now, the CBI monthly survey tells us that, despite a strengthening of our export orders, the orders on which our lifeline depends, we expect production to fall during the next four months. The same sort of thing is coming from at least half a dozen of the economic forecasters which I have been reading, forecasters as far removed as stockbrokers, on the one hand, and the London Business School on the other. So we find it very complex. A few months ago, when the pound was falling in value, we were told that we faced sheer catastrophe; and when it recovered the same people were sure that the "bow-wows" had got us. How on earth do we expect men in employment, or hoping to retain their employment, to react to that kind of thing?
It seems to me that the media dredge up every bit of industrial trouble—especially stupid and unnecessary strikes led by tin-pot Napoleons who could not hope to seek election for a full-time trade union position. Are these really the priority issues which people want to hear on the newsreels? It sems to me that we are now in the hands of the public relations people, and that they are doing inestimable danger to our hopes of economic recovery when this is the kind of thing that we listen to every day of the week. It almost reminds the older ones among us of the character in Tommy Handley's radio programme who was named "Mona Lott" who, after dispensing a great deal of despondency and gloom, always finished her act with the words: "It's being so cheerful that keeps me going."
My Lords, the more obvious causes of low productivity, such as the shortage of capital investment or the lack of man

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power, are not presented; although I think the problem of the insufficient number of skilled people (about which some of us have been complaining for a very long time) is causing hold-ups and actual unemployment in a number of our industries. However, I am sure that it will be conceded that the present Government are engaged in a huge training and retraining programme at very considerable cost, and I hope that we can have an assurance that no future Government of any Party would wish to cut down on it.
My only criticism in this field of activity is that, while we are seeing this great programme of training and retraining, we are falling further and further behind a number of our competitors on the Continent in the amount of day release and block release for our young apprentices upon whom we must rely for the future. When one reads of the huge percentage of young people in Germany and Sweden and in other European countries who automatically get day or block release against the miserable percentage here, we cannot hope to compete effectively with those other countries.
I do not necessarily like compulsion; but I think that the best firms in Britain who can compare on very favourable terms with any firms throughout the world, have for too long seen their products creamed off by others who have done precisely nothing to produce quality apprentices in this country. If we had a system of compulsion, I am sure that they would feel far happier about their own efforts; and those who have simply induced the apprentices away when other firms have trained them would have to play their part in the job of getting rid of this awful anomaly of a huge unemployment problem that we face now, and an equally large demand for non-existent technologists and craftsmen. It is a fantastic situation to have got ourselves into.
My Lords, we face the problem which, I think, was mentioned by the noble Lord, Lord Carr, of a falling percentage of our workforce in manufacturing industry; and, of course, this is a feature which has been going on in many of the manufacturing nations. I do not know whether we are getting to a danger level or not
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when we get down to 30 per cent., but it seems to me that, if we are to plan our future requirements in this sector, we cannot afford to permit the rather stupid bias against such careers. Indeed, from an engineering angle one is almost made to feel a second-class citizen. It is this in big degree, I feel, which is detracting from the ability of the manufacturing industries to get promising young men to take up careers in engineering and other comparable industries.
The noble Lord, Lord Carr, mentioned that which I have mentioned, an attitude of mind. I wonder whether the greatest question that the nation must answer is whether we really want parity—and are prepared to do the things necessary in order to achieve it—with those nations which have the highest living standards in the world today. I do not know whether this can be resolved merely by economic argument. We are all capable of screaming of how badly we are done to; but none of us seems able to adjust to the fact that, whereas in the 19th century we led the manufacturing world, we are miles away from that now.
Unless we have the capacity, the courage and the guts to face that and to do the things necessary to bring ourselves back to that level, we have no right to complain that we are not able to get the same standard of living as others. It seems to me that that is the decision we all have to take. If we want to jog along complacently, as a second or third rate nation, that is fair enough. Indeed, there is an argument for that going on today. If one decides on that, one should not moan about not getting the returns that other people get. Quite frankly, it is rather contemptible to do so.
We know that it is certainly not a shortage of capital for those employers who chose to accept it for purposes of modernisation, and there certainly is no excuse for trade unions to hang on to out-of-date restrictive practices. I thought that the noble Viscount, Lord Eccles, was unfair on this matter. My background is as a shop steward in engineering. I have never come across these restrictive practices that everybody else seems to know so much about. I was a works convenor in a factory of 30,000 people. I do not know of any occasion when deliberate restrictive practices were

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practised. It is the case that because of structural problems there have been occasions when men knew that the one job they had was the only one in sight and they would hang on to it. But with progressive management, who know that you cannot easily get together a highly skilled team of people, they themselves do not wish to see a team disrupted because of a temporary hold-up.
Industries such as those we know in Fleet Street have been mentioned. But they are not typical of the vast mass of British industry. Indeed, my old friend George Isaacs, whom the noble Viscount, Lord Eccles, will remember, used to tell me, when he was general secretary of NATSOPA, that those restrictive practices were begun by the Press "barons" in order to keep other people out of the industry, and that he as secretary of NATSOPA was obliged to accept them for that reason. When we look at these problems we find that the fault is not all on one side.
Viscount ECCLES: My Lords, I think the noble Lord was asking me whether I knew of any restrictive practices. What would he say to this? In a Government office when an electric light bulb fails one is not allowed to replace it. One has to send, not for one man, but for two from the Department of the Environment.
Lord LEE of NEWTON: My Lords, again, my experience is different. I have put plenty of electric light bulbs in lamps in the three Departments that I have served. Maybe it was because I had an engineer's card in my pocket.
It is not true, either, that productivity is enormously low in this country in every industry. We have heard the argument about agriculture in which we lead the world in mechanisation. That could not have happened but for the nationalised electricity industry pushing electricity to the countryside. I was privileged to work with the coal industry. There is no other coal industry in Europe which increased its productivity so much or so rapidly as the British coal industry. Indeed, as a consequence of the way they have worked, the accident rate in the British mines is less than in any other in the world. At the time when we were asking them to
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accept mechanisation, there was no going slow. They knew perfectly well that their numbers would be decimated. They accepted it, and increased their productivity. Do not let us be full of the idea that every industry in Britain is despondent in these important matters. Take the gas industry, for example. By the time they stopped carbonising coal and went over to oil, they increased productivity annually by 11 per cent. over a long period of time. Now they do not make gas any more; they just distribute it. But that again was a record of which they and we were entitled to be proud.
I do not know whether it will surprise some of your Lordships to know that, to workpeople, the main point about going to work is to get wages to have the standard of life which they wish to enjoy. I have oftened complained of the lack of a credible and understandable policy on incomes from the Party opposite. I repeat that criticism today. Whether or not this is the last opportunity we shall have of being informed by them of where they stand in this vital issue, their present position is rather unworthy of a Party which is aspiring to Government.
In May of last year we heard from their Leader that the social contract was in fact a social "con trick". We were informed that only a free-for-all on wages would be appropriate. A little later, strikers were to be subjected to the referendum procedure. Well, we can all laugh at that one. But the latest effort from Mrs. Thatcher is far more serious—I mention this because it is relevant to the issues of whether or not we get productivity increased. We are told that a Tory Government will allow free collective bargaining without Government restraint in the private sector, but the wage increases in the nationalised industries would depend on efficiency and productivity deals, while the local authorities, the Health Service and education would be kept within strict spending limits which a Tory Government would impose. If ever there was a recipe for decreased productivity, that is it.
How is it supposed to work in practice? Are the workers who are interested in the private sector of the shipbuilding and repair industry to base their claims on a free-for-all, while the members of the same branch of the union who work in the

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nationalised sector of the industry are to be instructed by Government as to what they can have? It would be a very interesting branch meeting, would it not? I am no admirer of the way in which negotiations are conducted in British Leyland, but if they are to be told that they cannot be permitted to have similar scope to that in the other parts of the car industry, industrial strife is an absolute certainty.
The other week, along with numbers of noble Lords, I listened to Sir John Methven speaking about incomes policies. I agreed with about 95 per cent. of what he said. It certainly had no relationship to what we heard from Mrs. Thatcher the other day about what the policy would be. We know the CBI do not want that; we know that the trade unions do not want that. Who does, my Lords? I know that there are many Members of this and of the other House who are Conservatives who do not want it, either. Quite frankly, this sours the whole face of industry. If one is trying to find the greatest degree of agreement, the greatest degree of certainty for the future, it is very wrong indeed to introduce that.
Indeed, when one looks at the comparison of what is to happen in the private sector and then in the public sector—and I have taken part in arguments about incomes policies, with which I thoroughly agree, for upwards of forty years—one sees the difference. This is the first time that I have ever heard in one sentence an advocacy of both. It is utterly ridiculous and impossible. We are entitled to an answer from the Dispatch Box. It is not good enough.
We are going into Recess. This Parliament may not reassemble again; I do not know. But to go into a General Election with people who aspire to Government with the kind of diatribe to which I have referred is quite wrong, unjust and unpardonable. I believe that we must press forward with what is to me one of the utterly vital issues when we are talking about whether British industry can begin to compete on equal terms with our competitors. It certainly will not with that kind of approach. I want to see the greatest possible unity between both sides of industry. I am very proud of the fact that in the huge factory in which I was convenor we never had an industrial
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dispute which we did not settle ourselves. We have never had a strike throughout the whole of that factory. It is a record and, if I am proud of anything, it is that. I believe that, unless we can get a clear exposition of where we stand on this vital issue for the future, we cannot expect to see men put their backs into huge increases in productivity—and I agree with all the people who have said that this is the only way we can survive.
5.50 p.m.
Viscount WATKINSON: My Lords, my noble friend, with his skill and authority as well as his charm, has really made the case about productivity. He has been supported by so many other noble Lords who have made quite excellent speeches that to embellish the argument as such would not add much. Few people, either inside or outside this House, would challenge what has been said here today; but what should cause us a great deal more alarm than it does is that, although these facts are not challenged, very few people indeed regard them as a challenge which requires them to do something about it in their own lives.
I have tried to think deeply about this growing malaise, as I am sure other noble Lords have done. I have asked myself: is it the fault of industry or is it the political frame in which industry has to operate? I think one is forced to believe that our truly lamentable performance—for lamentable it is—springs at least in part from wrong national policies, for which I suppose all of us in this and in the other place are to some extent responsible. No doubt there will be sharp disagreement as to where the blame lies: I would only say that on this political point certainly Left Wing activists bear a very heavy responsibility for it.
What we have to face today is that we live politically in a complex society. If you want proof of that, you might perhaps have taken note of what the noble Lord, Lord Lee, has just said. He gave a completely garbled account of what the Leader of my Party has recently been saying about industrial affairs, and he made the most of it: fair enough. But the question one has to ask is: is this confrontation entrenched in our political system really a good thing? Inevitably, it conditions industry and we cannot excuse

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it. I think, by saying that it is right and that any alternative is some kind of corporate State. Whatever one may feel about a conflict of Party politics—and I have indulged in them myself for a good many years—and whatever one thinks about them as the frame in which our beleaguered industry has to work, I have to say that in any case I believe that such a conflict becomes increasingly irrelevant. My first political master, Winston Churchill, used to say in some of his more Puckish moods that he liked to
"mar the symmetry of Party recrimination".
That is what we should try to do in industry and in industrial matters in the political field. Of course, as an old politician I am not unrealistic enough to believe that we shall make much progress with this doctrine over the next few months.
Yet again, it ought to be said that in the electioneering atmosphere in which this country will inevitably remain now until an Election, business has to go on, orders have to be obtained from foreigners, who think our political system is a little odd, to put it mildly. What are we going to be doing? —debating various versions of "the English disease" which, whatever the rights or wrongs of the case may be, tend to increase the controversy. That, I have to say, is what my old friend, the noble Lord, Lord Lee, who has just sat down, has just been doing his best to do.
All I can say is that this really will not help our exports. Productivity springs not from confrontation but from co-operation and participation, as the noble Lord, Lord Plowden, said. You cannot, and indeed will not, get increases in general productivity unless you can sink some of your differences and work together; the shop floor, management and directors. I hope I am not thought to be advocating a kind of namby-pamby Election campaign, because I am sure we shall not have one; but I think it is right that somebody who has spent 50 years in and out of industry and politics should look in this debate at what industry and those who believe in industry might cling on to at present which would make it possible for the next Government to encourage the very great leap forward that we know we must have in productivity and efficiency if we are to survive. I am driven to believe—I have said this before, but I still believe
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it to be true—that the rallying point has to be found first in the National Economic Development Committee. It was, after all, invented by my old friend, Selwyn-Lloyd, so surely it must be agreeable to my noble friends.
Now we come to the Industrial Strategy. Like the noble Lord the Leader of the House, I was in this from the beginning, at the Chequers meeting, and we both saw it develop, and so on, I do not disagree with what my noble friend Lord Carr said about it. Therefore, if Sir Harold Wilson and the present Prime Minister wish to take some credit for it, they are entitled to do so. Perhaps, therefore, one might hope that there could be found some slight bipartisan respect for NEDC and for some kind of industrial strategy—because I am by no means saying that the present one is the right one—as being the place where a new Government must start if we are to get the improved productivity that we all know we must have.
Just a word now about the Industrial Strategy, if I may: as I said, I do not disagree with what the noble Lord the Leader of the House said about it, but it has been much undervalued in some ways and in other ways it has been made into things which it certainly is not. One cannot expect miracles from this sort of exercise. I believe there are now over 1,000 businessmen and trade unionists deeply involved. If you meet the sector working parties—and I have met most of them in my time as President of the CBI—you cannot but be impressed by the fact that, although they are making slow progress, very few of them would say that they are making no progress at all.
What is happening there? Managers and trade unionists are trying to face together the present and future problems of their own industries and, thus, of their own jobs. So I hope that in the campaign to come at least these two propositions are not going to be condemned out of hand. I believe that sector working party reports, if properly handled, could be the real tool that a Government needs to judge how best to frame Government policy in such a way as to help, and not hinder, industry. This is the right kind of planning exercise and not, if I may address myself to the noble Lord the

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Leader of the House, the Party political device of planning agreements.
Therefore, let us hope that the Industrial Strategy, in one form or another, survives; but to survive it must continue to attract the strong backing of industrial management and it will not do that unless it is allowed to develop free of Party political interference. For example, if the Labour Party wish to wreck the whole concept of a joint approach at industry level to seek increased productivity and efficiency, they have only to commit themselves to a doctrine of "packing" company boards with trade union nominees. That will ensure no co-operation from management, by making the issue a Party political one both during and after the Election. Perhaps it is impossible for us to avoid this issue but, as the noble Lord, Lord Plowden, so rightly pointed out, there is here a gateway through which one could go to get the real productivity that we need, through better participation and better working together. It just cannot be done by the enforced "packing" of boards on an "old boy" basis by trade union nominees.
One other point, my Lords: many noble Lords have talked about unemployment and the problem of jobs. The noble Lord who has just sat down talked about those things and I have known him long enough to know how sincere he is about that. We have already too much employment-prevention legislation, hampering managers and, in particular, hampering the small business. I think any new Government have to look very seriously now at the burdens that are laid on small businesses, making it almost impossible for them to consider taking on more people and certainly making it quite impossible for them to take on people "on spec", in the hope that business will get better, in the way they used to do in the old days. So I have to say again that if what I may call the Industrial Strategy is to succeed, it has to grow in a mixed economy where the mix is left relatively alone, and where the present burden of legislation, particularly on the smaller firm, is certainly not increased, and, if possible, diminished. I hope that on this basis some strategy of this kind would continue to be backed by the CBI, and by all the trade unionists involved in it.
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I would also just mention here a very interesting initiative in productivity that deserves a compliment in your Lordships' House; that is, the spur initiative of the British Institute of Management, which is trying to show a real case history of how, firm by firm, you can make progress in this very difficult field. I should like to make one more political point, trying to think of this subject in terms of politics, as I believe one must. Joint bodies, such as sector working parties operating through Neddy, are not, in my view, the creation of some kind of corporate State. If Parliament thinks that it is in any way by-passed by bodies of this kind, it has the remedy in its own hands—one to which the CBI, at least, is committed—that is, that Parliament should set up a powerful Select Committee to oversee the whole work of a body such as the NEDC, and link Parliament firmly with it.
Finally, we need a much greater emphasis on productivity, to deal with the other great hindrance in getting our industrial affairs in order. I myself feel, and I think that many of my colleagues in industry feel, that although we see the dangers of eroding differentials, although we see the difficulties—and I quite agree with my noble friend, who said that if you have a wages policy you tend to diminish productivity—none the less, if we put the conquering of inflation as our first national priority, as I believe we should, we have to look forward to another year of some form of pay restraint. This is quite inevitable. I see no reason, therefore, why the Government, who are now the paymaster for something like 30 per cent. of the working population, should not very firmly disclose their hand and I hope that they will.
However, there is a way around this. Productivity, properly used, could get us out of the difficulty of beginning to pay the proper rate for skill and craftsmanship, even in a general wages situation that has to be based on only a very small increase in basic wages. I shall not stand in the way of the many other noble Lords who want to speak on this problem; it is well-known. But provided that productivity schemes are genuinely earned and really self-financing, provided that they are measured in value-added terms, there

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is really nothing very difficult about finding ways, or going towards ways, of increasing skill and widening differentials—and I mean for management as well as for skilled craftsmen—by the use of carefully tailored productivity agreements. I hope that this work will go on, and that both the Government and the Opposition—or the present Government and the present Opposition—will be doing their homework on this subject.
There is one point which has come through this debate, and which it is sad that we cannot impress on the public mind. I should probably be in a minority of noble Lords if I said that nobody listened to us, but perhaps I might be in slightly less of a minority if I said that not enough people listened to us. But it is a pity that, at a time when, presumably, the nation soon has to choose another Government, they do not understand that if we cannot do better than we are doing now, even with the bonus of North Sea oil, even with any short-term advantage arising from a seriously depreciated currency, we shall be the sick man of Europe, we shall be below Italy in the batting league and, in the end, even Europe will get tired of putting up with our lack of contribution to the club. That is the real issue that the country ought to be debating in its mind, and the country ought to be much more grateful to my noble friend than I suspect it will be.
However, let us hope that somebody listens and that, in the battle that lies ahead, in which, no doubt, all of us in our own small ways will take part, we shall try not to foul the nest for the next Government—which I think will not be of the colour of the present one—and will enable it to get on with this job of working through established existing bodies, such as the NEDC and the SWPs, and building the productivity that we must have if our country is to survive.
6.5 p.m.
Lord KALDOR: My Lords, like my noble friend Lord Lee of Newton, I must begin by begging the indulgence of the House for not being able to attend this debate until the very end owing to a long-standing engagement; something which I regret all the more because of the unusual quality of the speeches that
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we have heard so far, and because of the other speeches which are still to come. I should also like to add my congratulations to the many we have already heard on the maiden speech of the noble Lord, Lord Roll of Ipsden. He gave a bird's eye view of this whole complex of problems and spoke, in a space of 12 minutes, with a clarity and precision that were worthy of the best practitioners of our common profession. I do not think that I can give higher praise. I can only hope that, now that he has made his maiden speech, he will be a frequent contributor to our economic debates.
The noble Viscount, Lord Amory, did us a great service in telling us of the extremely critical situation in which we find ourselves. From the speeches that I have so far heard, it seems clear that there is no difference between the two sides of the House about the disastrous outlook that awaits us if we do not succeed in reversing the present adverse trends in productivity and employment, and the continued decline in the net balance of trade of manufactures, which leads to progressive de-industrialisation. In the course of the 10 speeches before mine, so many points were covered that it is rather difficult to say something new. Therefore, I shall concentrate on particular aspects and try to avoid repetition as much as possible, though of course I cannot guarantee that I shall succeed.
I take my cue from one remark of the noble Viscount, which was not repeated by subsequent speakers—that the problems of slow growth and lack of employment opportunities are not new problems so far as this country is concerned. Indeed, they are of very long standing, and among the leading industrial nations one can say that they are peculiar to Britain—however unfortunate it is to have to say that. We have suffered from them, with certain interruptions, ever since 1873. During the last 100 years, fast economic growth, combined either with full employment or with rapidly rising employment, occurred in peacetime on only two occasions. The first was during the five years, 1932–1937, when manufacturing output increased by no less than 8 per cent. annually, and industrial employment increased by more than 4 per cent, a year—something which was quite unprecedented in a five-year period in the history, not only of this

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country, but of most other countries, with the exception of Japan. It is no less remarkable because this period started at the bottom of a recession.
The second interruption was the period of 19 years after World War II, when we had continuous full employment, with unemployment well below 2 per cent., in all years except one when it was 2·1 per cent; when our manufacturing production increased not at the fantastic rate of 8 per cent. but still at a very respectable rate—even in comparison with all the other European countries—a compound rate of 4 per cent. a year. Since 1965 13 years have elapsed, and during those 13 years we had a four-fold increase in unemployment. from 330,000 to 1⅓ million, and the growth of manufacturing output slowed from 4 per cent. to 1¼ per cent. per year. Indeed, since 1970 the growth in our manufacturing output has been well under 1 per cent. a year, and since 1973 we have had a net decrease in output of 5 per cent. As the noble Viscount alluded in his opening speech, these figures cannot be explained by the prevailing world economic recession because all other industrial countries did very much better than this and now have levels of production which far exceed the previous cyclical peak, while in our case we are well below it.
The manifestations of this exceptionally bad record in the last 13 years are essentially the same as those of our very bad record in the 40 years from 1873 to 1913. I consider this to be a very important point since in all other respects our present situation—our present institutional framework, our present way of life—is completely different from what it was in the late Victorian or Edwardian age. The common feature of these two periods, the 40 years before World War I and the last 13 years, is that in both periods the progress of our economy was put in jeopardy by the rapid growth of the imports of manufactured goods which led to economic stagnation. As Sir Arthur Lewis has shown in a book just published, from 1873 up to the end of the last century the increase in the growth of manufactured imports more than offset the growth in our exports so that the value of net exports actually fell from £158 million in 1873 to £118 million in 1899.
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In the period since 1965 our net exports rose substantially, if you take them at current prices, but that is nothing more than a reflection of the rapid inflation. If you take the value of net exports at constant prices they have diminished by no less than one-third in the 12 years 1965 to 1977. In other words, they have been falling by over 3 per cent. a year, and that is despite the fact that in the three years following the 1967 devaluation we had a very substantial growth of net exports. In the 40 years up to the First World War our productivity rose very slowly and it was just as bad, in relation to the record of Germany and the United States—in fact, worse—as our relative productivity record after World War II, to which many noble Lords have alluded in this debate. It grew by less than 1 per cent. when that of the others grew by 2½ to 3 per cent. Job opportunities were very hard to come by. Indeed, jobs were so hard to come by that in the 30 years from 1880 to 1914 no fewer than 6 million people emigrated from Great Britain alone because of the inability to find jobs. In those days there was no unemployment insurance and no comprehensive record of the volume of unemployment.
What was the cause of all this? If one reads economic historians, if one reads the contemporary records, reports of the numerous Select Committees and indeed Royal Commissions that were appointed to deal with the problem at the time, they read awfully like what we have heard this afternoon—very like it indeed. It is all put down to slowness in adopting innovations, to the innate conservatism of our manufacturers, and later it was also said that it was due to our dogmatic adherence to free trade. At least the free trade aspects of our ill fortunes were brilliantly brought out in the speeches of Joseph Chamberlain during the famous tariff campaign of 1902.
As a result of our stagnation, or for other reasons, we were not able to participate, or not fully, in the new technological revolution which followed the invention of electricity, the motor car and synthetic dyestuffs. We relied on our traditional staple exports—cotton textiles, pig iron and machinery—and in these we were driven out from one market to another as a succession of countries industrialised behind protective tariffs. But those newly

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industrialised countries established also the newer industries requiring more sophisticated techniques, and in the course of doing so made a far greater and far more deliberate effort to raise education in advanced technology than we did. This was very much a cause of worry, as is testified by the numerous committees that Government and Parliament appointed in this matter in order to make up the gap in higher education in technology in this country.
The First World War changed all that. Under the stress of national emergency governmental planning, directed by the unique energies of Lloyd George, there were established hundreds of new factories and dozens of new industries. It also brought a radical change in the outlook of our manufacturers in the production techniques employed by industry. In the words of a departmental committee which reported in 1918:
"Until the war opened the eyes of manufacturers to the advantages of manufacturing in large numbers [there was] generally an absence of totally new works with an economic layout".
I fully agree with the noble Viscount that our achievements in the Second World War were just as great and just as notable as our achievements in the First World War. And they only go to show that the people of this country are second to none in organisational ability and in brilliant improvisation when it comes to a national emergency such as a war. This was shown twice in the lifetime of one generation.
However, the benefits of this new outlook on industry, and of the new capacity created, were frittered away for a time by the deflationary policies adopted on the recommendations of the Cunliffe Committee which reported in 1920 whose recommendations were relentlessly pursued by the Bank of England and the Treasury right up to the restoration of the gold standard in 1925. Even so, despite heavy unemployment of a million and a half, productivity showed a very much higher rate of growth than anything seen in this country since 1860, and then laid the foundations of the rapid economic advance which amounted almost to a second industrial revolution in the 1930s, and which alone put us into a position to face Hitler in the Second World War, and which was followed by continued high levels of industrial investment in the full employment era which succeeded World War Two.
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During all that time import penetration went sharply into reverse. The 1913 level of manufactured imports was not regained until 46 years later, in 1959, when the national real income was twice as high as it was in 1913. So even when we regained the 1913 level of imports, our import propensity was only half as high as it was prior to the outbreak of the First World War. But since 1959 the imports of manufactured goods have raced ahead again. Their volume increased nearly sixfold in the course of 18 years. As a result industrial growth fell very sharply, industrial investment fell, and despite a large boon conferred by natural gas and now by oil, we are still in a difficult position to make ends meet in the balance of payments, despite a greatly diminished capacity utilisation. In fact, although there was never any formal pronouncement the objective of full employment has been abandoned. It is something which, for balance of payments reasons, it is quite impossible to aim for in the present situation.
What conclusions can we draw from this? There is clearly something wrong with British industry which is not just a reflection of national policies. So much I think would be agreed by most noble Lords on both sides of the House. For example, German industry does not suffer from rising import penetration. On the contrary, their import ratio has been falling despite the temptation afforded by high and rising exchange rates.
Although our industry was greatly strengthened and modernised during the earlier decades of this century it now appears to suffer from the same kind of deficiencies relative to our competitors as it did before the First World War: a lack of practical expertise in high places; the supremacy of amateurs, whether accountants or so-called "administrators", in top industrial jobs; slowness in adopting innovations and developing new products, and many other factors. It would take many lectures and not a speech to go into these and their causes in any detail. I will merely quote one statistic which in my view sums up our present situation. The percentage of the total workforce in the engineering and other metal working industries represented by qualified engineers and by scientists in 1974—I repeat, 1974 and not 1874—was 6·6 per cent. in Sweden, 5·7 per cent.

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in West Germany, 5·3 per cent. in France, and only 1·8 per cent. in the United Kingdom. I think those figures more or less explain the basis of all our industrial troubles.
Finally, we must beware of being seduced by the temptation to seek attractive-sounding but phoney remedies, not to speak of soothsayers. Contrary to what some prominent members of the Party opposite proclaim, not perhaps in this House but in some other place, our basic deficiencies will not be cured—they may even be aggravated—by large cuts in public expenditure and large reductions in taxation. If this were not so, how would one explain that other countries whose taxation is even higher than ours have not suffered from low productivity growth? Perhaps even more important, how does one explain that we suffered from the same deficiencies in the late Victorian age when taxation was certainly very low, when income tax was seven old pence in the pound—that is to say three new pence—and yet productivity growth was only less than 1 per cent., industry was stagnating, incentives were lacking, innovations were hardly being introduced, we lost out on new industries, and so on.
In the same way I do not think our problems would be cured by balanced budgets, by limitations of the so-called money supply—whatever that term may mean; or by retreating from the Welfare State, or even by emasculating if not abolishing the trade unions. If this particular cure would work how would you explain the success of West Germany, whose Welfare State is very much more comprehensive than ours and whose trade unions are at least as powerful? Nor will they be cured, for example, by abolishing—a matter referred to by some speakers—the Employment Protection Act. Otherwise how would you explain the success of Japan, which has a super-employment protection Act, much worse than ours—or much better than ours, according to the way in which you look at it—because it offers guaranteed life employment to every worker? Yet Japan is not conspicuous for the sort of deficiencies that noble Lords have been talking about.
We shall not solve our problems by going back to the free market system of
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the late nineteenth century, which in Britain if not in all other countries proved to be a recipe for disaster. The true remedies, wherever they are found will surely be found somewhere else. And they are almost certain to involve as a necessary but by no means a sufficient condition a breathing space in the form of the protection of our home industries in much the same way as this was recognised to be necessary both before and after the First World War.
Viscount MASSEREENE and FERRARD: My Lords, would not the noble Lord agree, with reference to his remarks about the low productivity of the latter half of the 19th century, that it was not a real danger to this country then that we had poor visible exports because we had an enormous income from overseas investments? We had vast invisible exports, we had protected markets in the Empire, and of course the pound sterling remained stable for 100 years. You cannot really compare the end of the 19th century up to the First World War with today; they are two completely different things.
Lord KALDOR: My Lords, if I may quote a distinguished member of the noble Lord's Party, Joseph Chamberlain, he gave the perfect answer to this. He said the worker is not in the same position as the manufacturer. The manufacturer can help himself by investing abroad, but the worker depends for his living
"on the labour of his hands; and if that labour is taken from him, he cannot live on foreign investments".
So the wonderful position in which we found ourselves in the period the noble Viscount refers to may have been wonderful for the property-owning classes, but the property-owning classes were not identical and certainly were not co-terminus with the people of Britain at large.
6.32 p.m.
Lord SOAMES: My Lords, I, too, would like to join your Lordships in congratulating the noble Viscount, Lord Amory, for originating this debate. Its importance is shown by the speeches that have already been made in your Lordships' House and by the long list of speakers to come. I will be as brief as I possibly

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can be. The debate has also been highlighted by a speech from the noble Lord, Lord Roll of Ipsden. It took a year to get him to come and do this, and it took a debate of this character on such a subject, and this in itself is a matter of honour for the noble Viscount. He said that he knew the noble Lord, Lord Roll, when he was a distinguished civil servant. I must have known him sooner, because I knew him when he was an undistinguished civil servant, but it was quite evident then that it would not be long before he became a distinguished civil servant. He then moved on to other things, and he certainly rendered great services to the nation. It was a wonderful speech that he made, and we look forward to hearing from him again.
The noble Lord, Lord Kaldor, began his speech by saying there was no difference between the two sides of the House, apparently, to judge from this debate, about the danger to our country if we do not cure the problem of low productivity. But it did become most evident as the noble Lord continued that there was a good deal of difference between the two sides of the House about the means necessary to cure it. I should like to concentrate on offering a few thoughts to your Lordships on the part that Government can play, and should not play, in trying to overcome this. Since for eight years I have been working and living across the Channel, I feel I can view the British scene, and the changes that have taken place in recent years, without going back into history to the extent the noble Lord did, with some of the objectivity of the foreign observer, though without his emotional detachment.
I would invite your Lordships to remember the reasons which led the French Government to veto our first application to join the Community in 1963. That was only 15 years ago. It was because we were too strong economically, not because we were too weak. It seems hardly credible today that that could have been so. I remember that one of General de Gaulle's Ministers put me on notice to beware, that for the moment there was only one cock in the European hen-roost, and that if we entered there would at best be two, and at worst there would be one and it would not be them; so this was not very interesting for the
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General. As I say, it seems hardly credible that this was only 15 years ago.
In the past 10 or 15 years what has happened is that we have had the lowest increase in national wealth of any of the Community countries, despite all the advantages we have had in recent years from North Sea oil and gas. The main reason for this, of course, is that we have had the lowest level of productivity. Indeed, over the years it has been roughly half that of our partners in the Community. If we could get that right, then we would be well on our way to curing our economic ills. On the other hand, if we do not, then woe betide us as a nation. We all know all too well the glaring discrepancies of productivity in certain of our industries as compared with our competitors. We all have our own knowledge and we all have our own figures. I will not weary your Lordships with that. Suffice it to give just one figure, that in 36 productivity comparisons of industrial groups with Community countries Britain, alas, comes bottom in 34.
Small wonder, therefore, with productivity about half that of our major competitors, with our level of inflation in the middle '70s running wild, that the effective value of the pound should be today only some 60 per cent. of what it was in the early '70s, but much worse than that in relation to the strongest currencies. When we were living in the world of fixed parities, devaluation was a major political event. Many of your Lordships will remember what happened when there was a devaluation—a Statement in the House, followed by a debate the next day, everybody going on television. I remember Harold Wilson telling us that it did not mean the pound in our pockets was devalued. We all remember; it was a major political trauma. But in the last few years what has happened. It has drifted down. There has been an effective devaluation in real terms of some 40 per cent., and almost without more comment than if it had been an April shower. This is dangerous.
One of the changes that I see is that serious things seem to be happening without people apparently being sufficiently aware of the dangers. People rightly felt at a time of devaluation that it was a signal that all was not well, a signal of national failure and a weakening of the British economy. There was that

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feeling about it. But when the disciplines of fixed parities were removed industrialised countries really had two choices open to them in a general manner, one was to impose disciplines as it were voluntarily, without the risk of having to come before their Parliaments and admit devaluation; they had to impose their own disciplines, of a monetary, of a political, of an institutional, of a personal character, necessary to sustain high levels of production and productivity and to contain inflation and public expenditure. Those who did that, those countries whose people were persuaded that these were the right policies, have been rewarded with a high standard of living and have been better prepared to face the cold winds of recession. And of course they have strong currencies.
The alternative open to industrialised nations was to pursue weaker policies, to allow the disciplines to go hang and to let the strain be taken up by the exchange rate. For instance, in 1975 wages in this country increased by 30 per cent. and inflation by 25 per cent. or more, while production remained stagnant. It was, of course, the exchange rate that had to take the strain to a very high degree. For my money, that was to abuse the system of floating rates which is a delicate system, rather like freedom: if you abuse it, it can be highly dangerous. Indeed, if you abuse it too much it becomes little more than the monetary equivalent of the permissive society. So, for a lack of political, corporate and personal disciplines, and in particular because our productivity has fallen further and further behind that of our competitors, we have seen the value of our currency ebb away and a consistent haemorrhage of our industrial and economic strength.
Seen from across the Channel, it seems hardly credible that we are now so comprehensively out-performed by those countries which only a generation ago we played so noble a part in freeing from a tyrannical enslavement. It seems to them that out most booming industry is tourism, with foreigners flocking to fill their shopping baskets with our goods— which, with less than four marks required to buy a pound, seems to them exceedingly cheap—and to view the vestigial remains of our great past. How come? they ask. How has this come about?
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It is certainly not the fault of the mass of the people. A nation with a history as long as ours does not lose its qualities and its resilience in one generation. It is often said that an army is as good as its officers. So is a nation like ours as good as its political and industrial leaders encourage it and permit it to be. One of the prime duties of Government surely is to alert the people to dangers, be they internal or external, and to keep them constantly aware of what is required of them in their best interests. We are lucky in that our people have always reacted well to the truth, however hard. What is dangerous is to delude them. The temptation for Governments—not just for one Government, but for Governments in general—to yield to that is, I am afraid, strong. There is a very dangerous temptation, especially by leaders in whom they have confidence, either to try to delude the people or to lull them into a sense of false security. We have plenty of examples of that in our history. However, recently, I believe quite honestly, there has been too much of it.
I remember that some years ago it was the fault of the foreign bankers—commonly known as the "Gnomes of Zurich"—that sterling was being offloaded, while the truth was that our own poor economic performance virtually forced those abroad who are responsible for money management to switch out of sterling. It took unacceptably high interest rates to bring the money back again. Then all and sundry have been blamed over a period for not investing more in industry, while, as many noble Lords have said in this debate, the truth is that the investment will only come about when it is seen that the new machinery will be used and profitably used, and its advantages will be reflected in the balance-sheet of a company. Next, the institutions have been blamed a great deal recently for not buying more gilts, while the truth is that by incurring such a heavy borrowing requirement the Government were signalling loud and clear to the money market that interest rates would need to rise again.
Now the Germans are being blamed a good deal, including in a recent debate in this House, for not reflating their economy sufficiently to increase their import demand. I should like to say a few words about that. I should like to

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tell your Lordships what I believe the German authorities say. They say that they have run a tight and disciplined ship for many years now. By encouraging their people to work hard and effectively and make sacrifices they have built up their economic strength and an enviable prosperity. They have resisted political temptation to offer their people more than they can afford. So, without any miraculous discoveries of indigenous oil or gas, they have been able to weather pretty well the storms of the energy crisis and the recession by holding inflation firmly down and sustaining productivity.
I believe that very shortly they will make it clear that of course they would like to help us—indeed, it is in their interest so to do, for reasons both of interdependence in general and of Community solidarity in particular. But they will ask us that, in return, we should show an unequivocal earnest of intention to restore our economy to a more healthy state in a competitive world. That spells economic disciplines and productivity. I must confess that I do not think that it would necessarily be harmful for us if that were to be suggested, for it seems that it is when outside pressures are brought to bear from the IMF, for instance, that the Social Democratic dog finds it easier to control the Marxist tail; helped of course by an election being in the offing, which apparently tends—if I may mix my metaphors—to make the tail keep their heads down. Why, we have hardly heard a squeak out of them for months now; they only seem to talk about foxhunting these days!
I, like the noble Viscount, Lord Watkinson, hope that productivity will be a major theme in the next Election. I think that it is bound to be because it is so vitally important to the future of the people of our country, both in regard to their happiness at home and, let us not forget it, to their influence abroad. Both will depend upon their success in the creation of new wealth. That in turn should lead people to ask themselves—this is proper at Election time—which Party will put the creation of new wealth highest on its list of priorities, and which Party is more likely to create the conditions most conducive to increased productivity and to the creation of new industries and new business? That will be a major argument and a feature of it will, of
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course, be the different attitudes and approach of the two Parties towards taxation—above all, towards its purpose and therefore to its levels.
Suffice it to say—the noble Viscount, Lord Watkinson, put this point very succinctly, but I should like to add to it—that if one were to set out (and this has been growing over a large number of years, it has not just happened since last year) with the specific, stated objective of designing a tax system which would act as the maximum disincentive to effort at all levels of society, which would penalise and deter thrift, energy and success, it would be almost impossible to do better than the one we have in this country today. The taxation system has led us unwittingly, I am sure, but none the less alas! effectively, into being a cash and "perks" society; and so it has contributed, I fear, to debasing not only the currency of our nation but its character as well.
That leads me to put a point to your Lordships on the much talked of question of the likely attitude of the trades unions if, at the next Election, the people were to opt for a Conservative Government, with the emphasis that I suspect the Conservative Party will put upon wealth creation and productivity during the course of the Election. I do not believe that responsible trades union leaders see confrontation with Government as their rÔle or purpose; but, more important still, is the fact that the mass of trades unionists would not see this as being in their interests. I believe that it was the first Duke of Wellington who made the excellent remark that interest never lies. I believe, in fact, that the contrary would be true, and I should like to suggest to your Lordships why I believe this to be so.
I noticed the other day in a report on the AUEW conference that Mr. Terry Duffy, their new President, called for German wage rates for British workers. That is all strength to his arm. It shows a shift in emphasis away from anxiety to keep up with the Jones's to an anxiety to keep up with the Schmidts and Duponts. Of course, no one knows better than Mr. Duffy, that to sustain high wages in anything but the short term, they must go hand in hand with high productivity.
Increasing numbers of trade unionists must be asking themselves questions of this sort. They are not totally dissimilar

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to the questions which the noble Lord, Lord Kaldor, put before us. They must be saying that the British trade union movement is, after all, the strongest of any in the world and carries by far the most political muscle of any in the world. A Labour Government which, rightly or wrongly, are historically considered to be the political champions of the movement, have been in power for 10 out of the last 14 years. In deciding on their policies they have harkened to the desires and advice of trade union leaders. There has been a notable redistribution of wealth, to a point where the band of net income for over 95 per cent. of the British people is narrower than it is in any other industrialised country. Differentials have been considerably, and even dangerously, reduced.
Yet where has all this got us? Why, then, should our wages be so low compared with the wages of every other major industrialised country? Why should our standard of living be so low? Why, year after year, should our growth rate have been the lowest of our partners in Europe? Why is our currency so weak that we can only get good value for our pounds by visiting the poorer, less well-endowed Mediterranean countries of Europe? In short, why do we have to be told that our economy is in such a mess? He would have the agreement of the noble Lord, Lord Kaldor, in considering that it cannot be just the recession; for, as he said, that has affected every country, and why should others have weathered it better than we have? Could it be that the policies and attitudes that we were brought up to believe in are now out of date and that, when given the chance in modern times, have not proved to be as satisfactory or effective as we had hoped? Perhaps it is no longer right to think of the unions and their bosses in terms of "we" and "they". Could it be that in 1978 the "we" are those in all sections of society who want to see our economy grow and prosper; and that "they" are those who want to destroy it?
Increasing numbers of people must be asking themselves questions of this kind, and be not only willing but keen to see the Government doing more to encourage the creation of wealth. What is certain is that whatever Government are in power in the coming years, their main priority
724
has to be economic growth without growing inflation and, in particular, greater productivity. For what is at stake here is whether 60 million people can continue to live in these Islands with anything like the standard of living that they have been taught to expect as their due, or whether they cannot and will not be able to in the future. That is a great deal to have at stake, and failure would be intolerable.
6.55 p.m.
Lord ROBERTHALL: My Lords, may I begin by associating myself with everyone who has spoken in welcoming the initiative of the noble Viscount, Lord Amory. It must be very gratifying to him that everybody who has spoken agrees about the immense importance of this subject. Despite all the remarks that have been made about my old friend and, over many years, my old colleague, Lord Roll of Ipsden, I must also say a little about him. I greatly agree with what has been said about the distinction of his speech and hope that we shall hear more from him.
We are obviously going to have a long debate and I shall try to be brief. I hope that I can keep my remarks to two points. The first is that we know extremely little about how to increase productivity. The second is that industrial relations have something to do with it. My experience goes back to 1947 when I had the privilege of working under that great man, Sir Stafford Cripps, to whom the noble Lord, Lord Plowden, has already referred. As the noble Lord said, he was very anxious to increase productivity and did a great number of things that he hoped would help, including sending teams of workers and employers to America to discover why they did things so much better than we did. He also did a great many other things. I remember very well at that time Vincent Tewson, who was then the Secretary of the Trades Union Congress, spending a great deal of time and trouble going round talking to trade unionists and trying to persuade them that now that they had full employment and guarantees of jobs, they need not worry about working themselves out of jobs, which in those days was considered a very strong deterrent to people helping to improve productivity.
Since then every Government have spoken out strongly and firmly in favour

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of increasing productivity. They have all taken various steps. I remember that when the noble Viscount, Lord Amory, was Chancellor, he put back the investment allowances which Mr. MacMillan had removed during what he thought was a critical period. That is one example among a wide range of measures that have been taken to try to help and encourage investment. There has certainly been no trouble whatever about finding finance for investment, as several noble Lords have already said. Mr. Selwyn Lloyd, as he then was, started the NEDC and since then, as we know, we have had the "Little Neddies" and the working parties on which I think the noble Lord the Leader of the House is pinning some of his hopes for the future, and so on. There is not the slightest doubt that at least people like us have been worried about productivity; the Government have been worried about productivity.
What is the result? As so many noble Lords have already pointed out, our record, compared with that of our competitors, is very bad and is, in fact, deteriorating. From 1960 to 1973—which were both years of high employment—I doubt whether our productivity increased by more than a little over 2 per cent. a year, which was a little worse than in the 1950s. Since then it has hardly risen at all. It is no excuse to say that we have been in recession because all OECD countries, except Sweden, have done better in that period than we have—and most substantially better.
It is clear that try as we may we do not seem to be able to do much about it. That is why I say that we know very little about how to improve things. I very much agree with the noble Lord, Lord Roll of Ipsden, when he says that he does not think there is any panacea for it. Probably a number of factors are involved and, indeed, from listening to the debate tonight we have had nothing like a consensus of opinion about what we ought to do.
That brings me to the second point I want to make; that is, about industrial relations. I hope that I shall not give the impression that that is the only thing wrong with us; it is just that this is the subject I am going to talk about. We had a good debate about industrial rela-
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tions introduced by the noble Viscount, Lord Trenchard, whom I am glad to see is going to speak tonight. It was about seven weeks ago. At the end of his opening speech he ventured the opinion that if we could get a better system of industrial relations we could at least double the standard of living in ten years. I do not think that that is an over-optimistic prediction on the assumption that we could improve industrial relations.
Everybody with industrial experience, but particularly those with experience of very large firms, must be conscious of the extreme difficulty that exists in introducing any kind of change that it likely to increase productivity; whether it is redundancies, or the closure of plants, or the redeployment of people to other jobs, or getting a more rational pay structure or, as one noble Lord said a few minutes ago, "sticking to procedure agreements". I do not know whether it is innate conservatism, as the noble Viscount, Lord Eccles, said, but there is not much doubt that it is difficult to introduce changes. There was a horrifying figure from the chairman of Ford's, quoted by the noble Lord, Lord Plowden, that it takes us nearly three-quarters of our management time to deal with industrial relations problems, whereas in Germany they spend only a quarter of their time on that, and the other three-quarters they can think about productivity.
Why is this? I think that it has a great deal to do with the fact that we have inherited in our industrial relations the tradition of conflict and struggle which came in the 19th century, in the days when the workers were much weaker and solidarity was the only thing that it seemed would save them. This is brought out very well in a book called Conflict or Co-operation by the industrial editor of the Financial Times, Mr. John Elliott. He is very much in favour of the unions, and a good deal of the book is about the need to introduce the Bullock recommendations. He brings out clearly the persistence of this struggle/conflict mentality in our industrial relations; the feeling that anything you get from the boss is at his expense and that any concession you make to him is at your expense.
If this is right or if, at any rate, it is an important contributory factor, is it

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not time that the trade union movement woke up to the fact that we are not living any longer in the 19th century and that the whole scene has changed? The unions are now a powerful force in the community—in some respects, in my opinion, the most powerful force. They have got into this position partly by the consistent tilting of the law in their favour and against the employers, and partly by the development of our industrial structure which has made it increasingly easier for a small number of people to inflict great damage on the community. It is the solidarity that enables them to do this, because even when they are going to damage a lot of other workers they are still supported in their industrial action by the others.
Is it not time that the trade union movement told us what they are going to do with this power that they have? You all know the old story about the two miners after the nationalisation of the coal mines. They were talking about it and sayings, "What are we going to do now we own the mines?" The other one said, "Well, don't you think we can sell them?" The trade unions ought to say, "What are we going to do now we have this power?" If it is to be more of the same—more struggle and conflict— then it is likely that we shall go on having high inflation and low productivity. Do they want to introduce Bullock and get directors on to main boards? which Mr. Elliott, to whom I referred, would like to do.
I think that the Government are putting forward the view, in their plea for something like the Bullock Report, that having workers' representatives on the Board would tend to remove the atmosphere of conflict and promote one of co-operation. But at least some of the advocates of this are putting it forward in the hope that once the unions have got representation on the board they will get more ammunition for use in other struggles.
I shall end my remarks by saying that when people talk about industrial democracy, when the Government talk about industrial democracy in this context, it is not really democracy that they are advocating; it is only one leg of democracy. We live in a democracy and we think of it partly as the fact that it means that one man has one vote, and everybody has a
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vote for his representative in Parliament. But the other aspect of that is that you vote for your man, and then you agree to be bound by the majority decision of the elected representatives; and when the majority decides on a policy or passes a law, the others might not like it but they do not opt out and refuse to obey the laws or pay their taxes. They have to wait until the next election.
Is it often said that we ought to have workers' representation because shareholders have representation. But it is not a good parallel at the moment because the shareholders have votes, it is true, but the majority of the shareholders elect the directors and then the directors have the responsibility of carrying out the policy. I do not see much sign at present of the unions agreeing, if they should get something like Bullock, to treat their representatives as the shareholders treat the directors or as the electorate treats Members of Parliament. That is the spirit that would be necessary if we are to get away from this trouble of conflict and confrontation.
The unions ought to ask themselves what they are going to do with their power, and how things have changed. It is not now a matter of squeezing any more out of the rich; it is not a question of squeezing any more out of employers. If you get higher wages and no increase in productivity, the increase gets passed on. The result of extravagant wage claims is higher prices. So far as we suffer from inflation—and I am sure we do—it is the mass of the people who suffer from it, and even more with low productivity, as has been pointed out so often by speakers tonight.
Unless we get increased productivity, our standard of living is not going to rise, and in this case it hits everybody. The great bulk of people are workers or dependent on workers, so that conflict which you think is against the employers, or against the rich, when you analyse it is in fact conflict with yourself. That is something that we ought to try to realise, although I am sure that the realisation is going to be a slow job and it is very difficult to feel much optimism about, at any rate, the near future.
7.10 p.m.
Lord GREGSON: My Lords, the difficulty of entering a debate at this stage, after

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so many excellent speeches, is that the points one had intended to make have already been made. Because I wish to be brief and not repeat what other noble Lords have said, I shall abandon the notes I had originally made. I am, in other words, taking the hint of the noble Lord, Lord McCarthy, and abandoning excellence of employment for efficiency of organisation. I wish at the outset to congratulate the noble Viscount, Lord Amory, on initiating this debate and so enabling many important issues to be raised. I also wish most sincerely to congratulate the noble Lord, Lord Roll of Ipsden, on his maiden speech. I sympathise with him because I, too, spent a good deal of time in your Lordships' House before making my maiden speech. I was full of admiration for the noble Lord's speech and its content.
I have noted with surprise that the role of the trade unions and the rÔle of Government have been the two legs stressed on the question of productivity, while the role of investment has been somewhat suppressed in terms of its importance in relation to productivity. The noble Viscount, Lord Amory, and the noble Lord, Lord Carr of Hadley, played down the importance of investment in regard to productivity levels, though amazingly, having done that, both of them proceeded to give the shining example of agriculture in the United Kingdom. Unless I am greatly mistaken, the comparative statistics of this country's agriculture compared with the rest of the world show one point standing out above all others; namely, that the level of investment in United Kingdom agriculture has been the highest in the world for many years.
In manufacturing industry, however, notwithstanding what has happened in the recent past, the level of investment has been the reverse, with manufacturing industry almost at the bottom of the league table in terms of investment. Lord Amory made the point that in recent years the level of investment in United Kingdom industry has been running just below the levels of some leading nations. The fact remains, as my noble friend Lord Kaldor pointed out, one cannot make up the negligence of 100 years by running at the same speed as everyone else when they are so far ahead in the race.
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Another leg of this aspect of the argument is the number of times Germany and Japan have been quoted as examples of the leading nations in the productivity race. We should not forget that after World War II they started from scratch and received a great deal of assistance from those countries which were supposed to be the victors of that war; namely, America and, partially, the United Kingdom. There was massive investment and that was the starter for the investment programmes in those countries which have remained at high levels ever since.
I suggest, therefore, that the rate of investment is the one factor which needs to be examined very carefully in this equation, because if one looks at it in terms of the role it plays in providing the means by which productivity can be increased, one sees that this country lags far behind the leaders in the race in terms of applying adequate money for research and development, product development and manufacturing equipment compared with Germany and Japan.
I agree—strangely, perhaps, from this side of the House—with the President of the CBI. Writing yesterday in the Sunday Times, he said, in effect, that given investment, given leadership and given understanding he would put the British workforce second to none, and from wide experience of manufacturing industry in Europe, in the Americas and even in the Eastern bloc, I would completely and utterly agree with him in that sentiment. I believe the key is investment.
I turn to another subject, although the theme is fundamentally the same, and it relates to what my noble friend the Leader of the House said regarding the importance of what I believe to be a massive step forward in technology that is just beginning to unfold before us. Some 16 years ago, Dr. Williamson and I developed the first computer control machine tool. We recognised at that stage, in the early development of advanced mechanisation by the use of computers, that the limiting factor would always be cost, and therefore the complexity of the computer element in that situation. What has happened in micro-electronics, particularly with the advent of the silicon chip which creates and provides the microprocessor, is an enormous reduction in the cost of providing the inbuilt intelligence

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and nervous system of any automated equipment.
This is an advent in technology which has no equal in terms of any other step we have seen to date in human history and it will have a considerable effect on the whole of human endeavour, particularly manufacturing industry because the incentive is always there. I suggest that we may now be presented with perhaps a last chance, and I hope we will take the advantage of this enormous step forward in technology while it is still in its infancy, that we will grasp it and turn it to our favour. If we do not, we shall be taking another enormous step backwards, and this debate will become almost a milestone in history as being a debate at the time of an historical situation when we had such a tremendous opportunity presented to us.
I congratulate the Government on the lead they have been showing in this important technological step. The Prime Minister, the Leader of this House and the Secretary of State for Industry have shown considerable leadership in planning for the advent of this technology and in trying, in co-operation with industry, to bring about in this country the introduction of this technology. It is to be hoped that we shall find the past reversed and that at last, after a lack of initiative for so long, we shall begin to show leadership in a technology which could be essential for the economic well being of this country.
7.20 p.m.
Lord SELSDON: My Lords, when I listen to successive general economic debates in your Lordships' House, it is hard for me not to feel both impressed and depressed. Automatically, one is impressed at the breadth of vision, experience and knowledge, but depressed because although one may believe that a problem has been identified, one cannot see any real solution.
I am always conscious, as I move towards passive middle age, that opportunity is gradually disappearing from my life and that enthusiasm dies. And yet, on one occasion, which is today, I do believe that there is some hope. But I doubt whether any government—this
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Government or successive governments— may have either the courage or the ability to take the steps that are needed. Today, in the nine minutes or so in which I hope to speak, I shall try to get down to a number of specifics.
First, there is no doubt that our economy has declined, is declining and will continue to decline in relative terms. We have gone from being a rich nation to a poor nation. We are probably one of the only declining developed countries in the Western World. This does not mean—as we have heard today—that the ability, the potential and the resources are not there. If one tries to analyse the economic situation, one finds oneself drawn continually to various economic theories of demand-push or consumption-pull economies, and I am neither a neo-Keynesian, a neo-Victorian, nor a neo-feudalist. Nor do I necessarily subscribe to the views of Milton Friedman, or Professor Laffer, or others, who may try to advance economic theory. However, I believe—it is a view to which I hold quite firmly—that when we have a poor and declining situation there is automatically a polarisation of political views. This does not mean a swing to the Left or a swing to the Right, but generally a demand by one side that in order to put matters right we must take central control and do it from the centre; and a demand from the other that we must have a form of laissez-faire capitalism, and let things move freely with free market economies.
The situation with which we are faced in this country probably prevents either of those solutions, and therefore leads to the dangerous element of compromise. As a result we make no progress, discuss permanently why we have made no progress, and forget above all the Dutch elm disease of our economy—inflation—which, often unbeknown and unseen, destroys from within.
I would put the view to your Lordships that it is time we thought less about government and economic theory and more about people. The noble Viscount, Lord Amory, with customary perceptiveness, put his finger on the two points: productivity and employment. It is a pity that we have to think about employment, because surely, logically, productivity should come first and employment would

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logically follow. But we cannot cut off the past. We are therefore faced with the thought of considering a workforce in the United Kingdom of some 22 million, of which incidentally 9 million are women. We are forced to say that we cannot tolerate a higher level of unemployment than the levels we have at the moment. Yet, if we go on trying to buy jobs, we are pouring seed corn down the drain. Therefore, I should like to begin on the question of jobs and productivity and try to lay a number of ghosts to rest.
It is all very well to try to swim against a tide. It is always expensive, dangerous, and one can often lose one's life. We are faced with a rapid transition in labour, initially away from an agricultural economy and towards an industrial society. I should like to remind the noble Lord, Lord Peart, that productivity in British agriculture, is, as he points out, second to none. But it only employes 1·8 per cent. of the total labour force. It is interesting to note, as a result of my analysis of trying to find examples of productivity over the past two years, that agriculture comes out above all, particularly in the monthly digest of statistics—from which I note that the number of rams and bulls in service always declines under a Socialist Government but in general the number of sheep and cows remains fairly constant, which is obviously a sign of increased productivity. I therefore dismiss agriculture because it is doing well, with considerable difficulties, notably from above in terms of climate. I move to manufacturing industry, which has lost something like 1·2 million people over a five to six year period. Manufacturing industry employs only one-third of the total workforce, and total productive industries employ about 40 per cent.
Increased productivity in manufacturing industry will undoubtedly create increased unemployment in those sectors. It is fair to say that manufacturing industry in the United Kingdom is probably between 22 and 27 per cent. overmanned, compared with that of our competitors. People may blame lack of investment for this. My German friends point out that the British people are the best in the world at working with out-dated machinery and equipment. One may blame investment. I do not say that it is lack of investment that causes the problem, but lack of initiative. There is no problem
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when it comes to money. When one asks banking friends, "When did you last finance a new plant to make something new in the United Kingdom?" very few of them can remember. There are odd plant extensions here and there, but nothing new.
The decline in jobs in manufacturing industry is bound to continue, particularly if we have increased investment and modernisation. That we must take as read. Then one comes to the balance of the economy, where 50 per cent. of employment is in the service industries. Service industries have one great advantage in that they tend not to be too capital-intensive, and tend to have a high level of employment. If one looks at the service industries over a period of time, with one minor exception one finds that all of them have increased the number of employees in their sectors, quite substantially in some cases. I do not necessarily speak here of insurance or banking or the financial world, but of tourism, hotels at one level, or even transport or services that go with it at another.
One must look at the general trend in this matter. If one analyses it in economic terms, it is the desire to move from being a blue-collar to a white-collar worker. Probably we are faced with the fact that everybody, if they could have their way, would not want to work in heavy industry with their hands It is logical that everybody expects their children to do better than they did, and that every child hopes to do better than his father. Therefore, there is a logical movement towards a better type of job, a white-collar job.
Government initiatives in trying to support development areas in general have cost jobs. They have often destroyed productivity. Once upon a time one remembers Wolverhampton and Sheffield as being the centres of the engineering industry. When development areas were created, in good faith people enticed work away from the productive centres into other centres, where it ceased to be productive. In employment I therefore suggest that many of these things should go by default. We should no longer look for special development areas. There are high levels of unemployment. For instance, there are 304,000-odd people unemployed in the South-East—the largest number on a regional basis. If we are looking at jobs

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as a whole, I believe that there should be a complete and utter rethink of area policy because we cannot buy jobs and have good productivity at the same time.
I now move to the second area, which is the question of productivity itself and why we do not have good productivity. If one asks, as I did today, a whole range of people, "What is wrong? Please tell me so that I may say something about it", they come back to the same thing—incentive. It may be because they have heard the word on the radio. Maybe they have heard the word somewhere else. But in general they say, "Why do we work?" It is not a question of asking why companies work. It is a question of what will motivate and encourage the individual to work, set up a new business, expand his area of operation within a company, or his area of operation on his own. That inevitably must be a carrot. It must be profit in one form or another, or a better way of life.
If we take a poll around the country at the moment we shall find to our surprise that very few people have any disposable income at all. That is what work is about. One should not be working just to maintain the roof over one's head. One should be working in order to have enough disposable income at the end of the day to improve one's standard of life, the standard of life of one's family, and that of others around one. I come here, inevitably, to the question of taxation. I refer to the Californian situation, and perhaps momentarily to Professor Laffer who pointed out that if taxation is nil, you cannot have a Government; if it is 100 per cent., people will not work. Between those levels lies a mean, above which the law of diminishing returns, in terms of productivity and other matters, sets in, and if taxation reaches that level it is disadvantageous to the country. The first sign of that is when people start to criticise the centre and accuse it of being paid too much. Perhaps it is fair to point out that people say that MPs are over-paid, but our MPs are the poorest paid people in the world. This criticism of the centre depends more upon emotion than upon fact.
I should like to try to suggest a shift in taxation, not necessarily towards VAT or those areas, but away from the indi
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vidual in employment and more towards profit, dependent of course upon the creation of profit in productivity. Currently every year the Government receive about £38 billion, and spend £44 billion. It is interesting that the debt service costs are almost as much as the total tax which the Government receive from company profits. The Inland Revenue's total revenue is about £21 billion or £22 billion a year, of which, surprisingly enough, only £3 billion is from companies, while £18 billion is from the individual. That amount has trebled since this Government came to power; it is no criticism of the Government—it is partly inflation and other factors. I have much sympathy with the staff of the Inland Revenue, faced with having to absorb three times the amount of revenue from the individual, and very little from the corporations. It goes further down the line: the big companies no longer pay tax. Because of the tremendous taking with one hand and giving back with the other, in real terms the level of taxation on the larger companies is relatively small; and yet they cannot absorb a higher level of tax because of productivity.
The burden of this lies on the individual, the smaller companies, the man seeking to build a business. I suggest that it is not a question of laissez-faire capitalism, or working from the centre downwards with increased bureaucracy; and it certainly costs more money to take with one hand and to give it back with another. It goes back to the grass roots, to creating the same feeling as perhaps occurred in some small way in Jubilee Year; in persuading the individual that he wants to build a better way of life for himself and his family, and giving him the means whereby to do it.
7.32 p.m.
Lord KILMARNOCK: My Lords, there are two propositions contained in the wording of the noble Viscount's Motion. The first is that our productivity is dangerously low in relation to that of our main international competitors. We used to know exactly who they were, but these days new members are constantly joining the club without, one might say, the formality of being proposed or seconded. Anyone who saw the extremely revealing Granada Television programme on South Korea on Tuesday, 20th

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June, will have a good idea of this new type of membership. We were shown the means employed for the production of footwear, cutlery, cars and steel, and we were given some idea of the enthusiasm of the workforce. Next week your Lordships will be debating shipbuilding, and South Korean competition is bound to figure prominently in that debate. Not only has the EEC Commission come up with a proposal for the rationisation of the Community's shipbuilding industry—shedding some 60,000 jobs—but it is now drawing up proposals for a cartel to control the production of synthetic fibre. It is also expected to issue a general proposal on the so-called "crisis cartels" during the summer.
All these proposals and emergency measures very forcibly suggest that we shall have to carry out a phased withdrawal from our old labour-intensive industries, or at least rationalise them in such a way that much manpower will be shed along the route to competitive efficiency. Some people will say that that is not such a disaster, and that what we ought to be doing is reinvesting in fields where high skill and high technology are required. Clearly, better productivity in industries for which there is a market is the only way to stay in the international industrial league at all. But I should like to pause here and ask not only myself, hut all of your Lordships, what is the object of productivity, or indeed of industrial activity of any kind? It is surely to provide a stable and acceptable way of life, with adequate earnings, adequate services, and adequate leisure for the whole of our population; not just for a part of it, but for the whole of it. The question that follows is: How far will increased productivity contribute to this?
This brings me to the second part of the noble Viscount's Motion, which stresses
"the need to stimulate new and constructive job opportunities which would follow from an improvement in our national productivity "
But, my Lords, with great respect, would they? I do not want to be repetitive. The noble Lord, Lord Selsdon, has touched on the question of jobs, but this is so important that I feel that I must mention it, too. I have here a publication, which I am sure many of your Lordships have read. It is the Manpower Services
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Commission's Review and Plan published in November 1977. In it the commission admits, in rather small print, at the bottom of a graph on page 21, that they expect a "crude job gap" of 2,320,000 in 1981, if there is no net increase in jobs on offer by that date. This appears to include an allowance of 300,000 unregistered unemployed; but it is still a frightening figure, which would give rise to the most horrifying social consequences. And it is almost certainly an underestimate. The Manpower Services Commission is in the job creation business, and is bound to err on the optimistic side. According to an article in The Times of 24th June, the Cambridge group of economists has come up with a forecast of 2·9 million in 1985. I think that the noble Lord, Lord Lee of Newton, gave a figure of 2·7 million; that was possibly for an earlier year. The Institute of Manpower Studies at Sussex University has come up with a similar figure. The Institute of Management, Berlin, thinks that the 3 million mark might be reached in this country by 1980, discounting special temporary Government schemes to create jobs.
The Manpower Services Commission admits the difficulty of closing the gap, even if it is contained within their own lower estimate. After a graph showing the number of additional jobs that would be needed to reduce unemployment to various more acceptable levels by 1981, they go on in Chapter 2, paragraph 20, to concede:
"…that it is improbable that in the medium term employment will increase at the rate implied in the last paragraph".
In Chapter 2, paragraph 23, the Commission say:
"Though the depth of the current recession makes it difficult to separate cyclical from structural factors, it appears that changes are taking place in the world economy which are likely to have a significant effect on British industry and commerce …".
This is a very welcome recognition, though I feel that the word "recession" is question begging, as it predicates an improvement that may never take place, at any rate in terms of employment. In Chapter 2, paragraph 25, the Commission indicate their support for the Government's strategy, which they say is intended to improve competitiveness.
"However"—
they continue—

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"there is a dilemma in this policy. The industrial strategy depends on high productivity, growth and investment, which will not necessarily increase employment in the short term…".
I am not trying to attack the Manpower Services Commission. Given their terms of reference, I think that they have stated this dilemma with commendable honesty. However, the question forcibly poses itself: If the strategy will not increase employment in the short term, why should it increase it in the long term? In Chapter 2, paragraph 26, they go on to recognise that technological advance is at the heart of the dilemma.
"In spite of low investment"—
they write—
"there has been a consistent trend in British manufacturing industry towards new technologies and more capital-intensive methods of production, and this trend is, in our view, likely to continue. The next five years are likely to see advances in computer and systems technology, not least micro-processing"—
which was referred to by the noble Lord, Lord Gregson. The Commission goes on:
"In the major manufacturing concerns which are at the frontiers of this new technology there may well be a reduction in job opportunities…".
But is this the only area in which there will be a reduction in job opportunities? It is sometimes suggested and argued very cogently—it has been argued in this House—that a kind of spearhead or elite corps of highly competitive, high technology, high value-added industry should he developed in order to bring in the profits which could then be spent on an ever-widening range of service industries, providing jobs for everyone. This sounds very attractive; but is it feasible? Is it not likely that the new technology will penetrate the service industries, including the retail trade, just as much as it will penetrate manufacturing industry? In the last of the four recent Times articles specifically on unemployment we read:
"Mr. Barrie Sherman, research director at the Association of Scientific, Technical and Managerial Staffs, is one of those who believe that service industries such as banking, insurance and retail distribution are highly vulnerable. Electric typewriters, with a memory allowing typists to correct, edit and repeat previous work, are, with other advances, likely to send much routine office work 'very much up the spout'"—
his words, my Lords. No fewer than 800,000 people are currently employed in secretarial work alone.
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I do not want to be a Jeremiah, and one does not have to take as gospel every forecast, as they are all necessarily based on some unquantifiable and unknowable factors. But when that is said and done, there can be no doubt that we are in an area which should be causing very grave concern. The serious Press shows some awareness—witness The Times articles. The media show some awareness—the Granada Television programme I mentioned is a case in point—and the universities are aware of it. But is the political establishment really aware of it; and, if so, is it taking it to heart? In chapter 3, paragraphs 10 to 13, of its review, the Manpower Services Commission itself indicates some of the questions which it thinks should be asked, but stresses—and I quote—
"that it is not for the Commission to lead the debate".
That is a perfectly proper stance for a Government agency, and I do not dispute it. But who, then, is going to lead it?
In the debate initiated by the noble Lord, Lord Hanworth, on the 15th May, I ventured to suggest a Select Committee of your Lordships' House in the next Session on the subject of unemployment, and I have received some support for this proposal from noble Lords on all sides of the House, for which I am grateful. Others have felt strong misgivings about the width and range of the subject. The noble Viscount, Lord Amory, himself is one of these, and his great experience and wisdom can never be disregarded. It has also been suggested that it is properly a matter for a Royal Commission. But even if that should be the eventual outcome, I cannot get it out of my head that your Lordships' House should at least start the process by clearing the ground of some of the scrub of misapprehension and wishful thinking with which it is covered at present.
I take very much to heart the danger of too wide a focus, but there are a good many facts and forecasts now available, and more, it appears, are on the way. For instance, the social and economic implications of micro-electronics have, we are told, been fed to the Think Tank; and a similar study is under way by the Advisory Council for Applied Research and Development, which will also consider the manpower consequences of the new

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technologies. The latter body has been referred to this evening by the noble Lord the Leader of the House, and it is welcome news.
Both bodies come into the category of advisory bodies within the framework of Government. Will they publish reports; and, if so, what independent body is going to draw together all the evidence and all the studies and give a balanced view? Surely it would be of some value if we were to review them and make an estimate of the upper and lower limits of unemployment in the medium and the long term. Next, should we not set out and summarise the various remedies which have been proposed to date, which include longer education, less overtime, sabbatical years, work-sharing, earlier retirement, labour subsidies and (a theme which appears to command considerable support in your Lordships' House) the encouragement of small businesses—and, I would myself add, the self-employed? If we went no further, I believe we should be doing a useful job.
Personally, I should also like to see a committee come up with some recommendations on where we should be directing not only our thoughts but our actions. But I accept that some noble Lords with far greater experience than mine feel we should not be too ambitious, and if that were the majority feeling I would settle for a ground-clearing operation. But whatever form our inquiry takes, if it takes any at all, there is no doubt in my mind that we are at present reacting with crisis measures towards phenomena which stem from fundamental changes taking place in the world economic and social order. Unless we are extremely honest with ourselves and far-sighted— and, perhaps I might add, shrewd —unemployment will inevitably grow and spread, rotting the whole fabric of our society and destroying the beneficial results of any improvement in productivity or improved competitiveness which may be achieved. I believe it is the duty of this House to warn the Government and the country of this appalling danger.
7.45 p.m.
Lord COLLISON: My Lords, it is getting terribly late. I assure your Lordships that I have been outside scratching out from my notes as much as I can, so if I sound disjointed your Lordships will
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know the reason why. I should like to thank the noble Viscount, Lord Amory, for introducing this debate. In my past capacity as General Secretary of the Agricultural Workers Union, I have had dealings with all three of the ex-Ministers of Agriculture present tonight. I conceive Lord Amory and Lord Soames to be personal friends, if not in the way that one uses the word "friends" in this House, while my noble friend Lord Peart, the Leader of the House, is my friend on both counts; and it has been a pleasure to listen to them. Although Lord Roll of Ipsden is not here, I should like to put on record my appreciation of what he had to say to us this evening. It was excellent, and I hope it will not be another year before we hear him again. We should like to hear him very often.
Agriculture has been mentioned several times during this debate, and I am sure your Lordships will forgive me for mentioning that industry again because of my personal interest in it. I conceive that in all the speeches we have had, many of them ringing a little of doom, agriculture has been an exception, in the sense that it is a success story. Indeed, the facts show us that agriculture's production record is something of which the industry can be proud. I think this is recognised by the general public. One hardly ever hears a criticism of the industry and of those people in it. One also hears very little about problems arising from industrial disputes in agriculture, because there have not been any; but perhaps I can mention later what I feel to be the reason for that.
Over a period of time the area of agricultural land has been declining. Indeed, over the five years to 1972–73 the average loss of agricultural land in the United Kingdom was about 144,000 acres per year, much of which was good agricultural land, despite the Ministry's efforts to conserve it. Of course, it went for urban development, for industrial development, for recreational purposes and for the making of more and more roads. But despite the loss of this productive potential from all that land over the past 25 years, the agricultural production of this country, of our industry, has more than kept pace with the growth of population in the United Kingdom. Farmers and farm-workers have increased their contribution

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to the nation's food supply to about two-thirds of the total supply of the types of food which we can produce here. Furthermore, as has been mentioned already, this has been done with a very much reduced workforce. Output per head, at constant prices, increased, on average, by some 6 per cent. per year between 1960–61 and 1974–75. The increase is still going on; and, although it has been reduced over the past two years, this is due to a conglomeration of adverse factors for which the industry is not responsible. Indeed, it included two years of bad weather conditions, including drought. As I say, the people in the industry were not responsible for that; and, indeed, I understand now that productivity in agriculture is back to the pre-drought levels. I hope that this is so.
If one wishes to make a comparison with the EEC, the Agricultural EDC report, the "small Neddy" report, published last year, makes it clear, as they say, that
"Although precise comparison is extremely difficult, it is broadly true that United Kingdom agriculture is a relatively efficient producer in European terms";
and that, over the past decade, United Kingdom production has grown as rapidly as the average rate for the EEC, excluding Holland which has done better than any of us in the Common Market.
Finally, my Lords, the proportion of home-produced food as a percentage of total food consumption has risen from 49·3 in 1960 to 52·8 in 1975. On any count, that is a good record. Of course, I know, we all know, that much of the success is due to the introduction of more and better technical practices, due to research and, in particular, to the fine work done by the Agricultural Advisory Service, and also, if I may add this, by the Agricultural Training Board which the union, my old union, and I, myself, fought so hard to get established in years gone by. Great credit must go to these sources, but also to the people in the farming industry who have adjusted themselves quickly to the use of modern technology, modern machinery and to all the demands of what is now a highly sophisticated industry.
Speaking for a moment for the agricultural worker, it is clear that he has played his part, although I think that most people
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will agree that, so far as his remuneration is concerned, he still stands pretty low in the tail of the queue. His basic wage is still only £43 a week and, although we have a wage structure now (another thing for which my union and I fought strongly) the craftman's rate is only £47·30. As Mr. Bert Hazel said in his presidential address to the union's conference last May, there is still only one-third of the full-time labour force in possession of a recognised craft certificate. He added—and I agree:
"This is a deplorable situation in the light of the known skills and responsibilities of our present-day workers".
That is not much encouragement for the workers, is it? Yet despite this (one could feel) disincentive, Mr. Charles Jarvis, the chairman of the British Farm Produce Council, writing in Country Life of June 29th—and I happened to read it —was moved to say:
"I hope very much that the number of professional farm workers will not diminish but, if anything, increase. They will be vital if we are to substitute imports with home production and at the same time maintain the beauty and interest of the countryside. Besides… I should like to think that the happy and satisfying relationships enjoyed by so many farmers and their men may continue for ensuing generations and set an example for others to follow".
This is where the point of my speech comes alive. We have something in agriculture which would clearly be of advantage in other industries. Some, the cynics, would say that because of this friendship between the farmers and the workers, the farm workers are at the lower end of the queue when it comes to remuneration. If that were so, it would be a disgraceful thing.
But I would rather make another point. I should like very much to see industry as a whole moving away from the chaotic jungle which is now thought to imply that muscle alone can achieve what people deserve and what they ought to have. Is it to be wondered at? One must not forget the history of the working people in this country: for many years having to fight for union recognition and having to wrest from unwilling employers a reasonable standard of living and having to use any weapons they could find. Those old concepts, those old wounds and scars still sometimes ache. Even today, you see time and time again a trade union putting in a claim, the employers resisting it and only conceding something when there has been a strike or the

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threat of a strike. That leads people to believe they have to learn that if you want to get anything in terms of wages and conditions of employment you must have muscle. I want to get away from that. I would rather see a situation where work people got what they were entitled to in terms of their dedication to the job, their responsibility and their skill—with no argument. I do not want to see people who have been left behind—including my own union and many others likes nurses—having to bring up the tail of the queue.
It can happen. I am sure it can happen. I am one who is optimistic enough to believe that industry is moving in that direction. That statement in Country Life may have been naive; but I think it is true. There is, I think, a very good reason why it is true that farmers and farm workers get on so well. In farming, the labour force is small and employment on each farm is limited. You often find just one farmer and one farm worker; sometimes two or three; and, rarely, a dozen. The result is that the farmers, employers and workers, walk the farm together. They discuss what needs doing. If the farmer changes his policy, he explains to the workers why he changes it. The workers give advice and often argue; but they know what they are doing and why it is being done.
This is good communications. I spent years on the Royal Commission, the Donovan Commission; and if I learned anything there, it is that if you want good industrial relations, you must have good communication. I believe that men are sensible and that if they understand, on both sides, what is going on and why, then you will get agreement and a good co-operative effort from both parties. That is one of the reasons why I believe that agricultural workers and farmers get on so well. Let me say clearly again that if advantage were to be taken of that in order to keep the farm workers down, that would be disgraceful. I must be quite adamant and clear on that.
In agriculture, there is something else. In agriculture, you are working on the land with Nature. It is a humbling experience. If you forget you are working with Nature and have got to go her way and not yours—you can improve her;
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but it must be in terms that Nature is prepared to accept—woe betide you! That is a humbling and salutary experience. Perhaps it is not quite the same in a huge factory where all that you do is to press a button and hundreds of horsepower are at your disposal. Farm workers and farmers are in close touch with the essentials of life. This must mean that they are very close to the job which they are doing. You sow the seed, you tend it, you watch it, you fertilise it and you bring it to harvest. You wean a calf and you see it grow to maturity to produce milk. You are involved in what you are doing from start to finish. That involvement gives something rather special. It gives people a real job satisfaction when it is done—despite anything and everything else. That is what I want to bring out this evening. I will not go on. I am not an industrial person. I have never worked in a factory. I am sure there are people about, consultants and management organisations, who could find ways and means of bringing into other industries this closeness as between what employers are wanting to do and communicating to workpeople how it is done. I repeat, good communications are of the essence, and if one could get involvement by both managers and staff, that too would change the pattern of our industrial relations set-up.
I am a profound optimist. I believe that these things are going to take place. The noble Lord, Lord Soames, asked: Is it not time that we moved away from the idea of "we" and "they"? I think so, too. It can be done only if employers are prepared to concede that workpeople are entitled to have all the information which they ought to have and to go down with them on the shop floor and make it clear that they are not looking at it in terms of "we" and "they". If this example of agriculture is of any help and can be transmitted to broader industry, then what I have said this evening may be of some use. I can only hope so.
8.2 p.m.
Earl DE LA WARR: My Lords, it is impossible, in the very short time that I shall allow myself, to cover the whole spectrum of the problem that is posed by the noble Viscount's Motion. We agree that productivity is far too low, not because of any absolute measurement but simply

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by comparison with our competitors. This country is at the moment taking a terrible beating from all our competitors in Europe, the United States and Japan. I can see no end to this beating, and I can see it getting worse before it shows any signs of getting better.
It might be useful to mention some of the more glaring examples. The motor bicycle industry, for instance, has already disappeared completely. The same applies in a very large measure to transistors, transistor radios and other electronic audio goods. It applies to the extent of 75 per cent. to refrigerators; and the television industry—if I may mention something that is my concern—is having a very hard time of it in small screen sets. Will anybody doubt that the invasion of our domestic motor car market is still growing very fast indeed? Why is it that we in this country are producing so much less than we could, even given the inadequacies of some of our plant and machinery—a very real factor? Does management, first of all, bear a share of the blame? Yes, of course it does. There is nobody who does not bear a share of the blame.
I should like to pick out from among a number of things that I could use, one facet of the inadequacy of management, because it appears to me to be among the most important. This is its failure to communicate, and this is the point on which I agree so strongly with the noble Lord, Lord Collison. Every organisation—and this starts right at the top—must have the machinery, and the will to work it, by which policies and plans are fed down the line so that every manager and man knows what he is doing and as much as possible of the context in which it is being done.
I believe it is a first line manager who has the most difficult time in this respect. He is in day-to-day contact with the labour force. To my certain knowledge, some of them have to spend up to 30 per cent. of their time dealing with complaints from shop stewards. I noted that the noble Viscount talked about 50 per cent., and the noble Lord, Lord Plowden, talked about 75 per cent. I believe that they were dealing with the motor car industry, whereas I am not, so that may provide some reconciliation. But if the first line
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manager is not fully briefed by his superior, he is not given the best chance to deal with his shop stewards; nor is he able to do his best in the job of communicating to the workforce. There are far too many cases where the supervisor does not know what is happening and he is told by his shop steward instead. That, in terms of communications and efficiency, is something which is very, very bad.
Why are sickness and absenteeism at their present level? I believe that these two together are responsible for a much greater loss of output than is commonly realised. I know of no single reason why these things occur, nor would I attempt this evening to give your Lordships any analysis. I know of one company where, on an average per man with holidays of 20 days, public holidays of eight days, absenteeism at 16 days and sickness at 11 days, 55 days out of 250 are lost. Effectively that means that the company is already on a four day week. That is an example which speaks for itself. As to sickness—and I am sure that no noble Lord will accuse me of suggesting that everybody who goes sick is a malingerer—there must be many who will understand what I mean by "rota" sickness, whereby in a particular unit or gang a proportion will go sick each week. This, together with straight absenteeism, gives the most obvious example of the failure by those who are guilty to realise the seriousness of their actions. It represents too, I suggest, a fearsome lack of managerial discipline.
Why do we settle so many of our disputes only after unofficial strikes? I do not believe that there are any more mistakes made by management or employees in this country than abroad. We all have our grievance procedures. The difference seems to be that our foreign competitors carry on producing cars while the grievance is being dealt with. Too often in this country tens of thousands arc forced to stop work, frequently against their will, until a grievance involving perhaps a handful of men is settled. I make no bones about putting the blame for this fairly and squarely at the doors of the trade unions, who must put these matters to rights and must do it very quickly.
We do not get to the heart of the matter until we come to restrictive practices, refusal to work at more than a cer

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tain rate—and the noble Viscount, Lord Eccles, talked about going slow—the refusal to do another man's job or to let another man do yours. What is behind these things and what, too, is behind the constant refusal to agree to reduce manning levels on new machinery? Let no one be in any doubt that this is going on all the time in British industry.
It is my own view, without any doubt, that the fear that to give way in these matters is to increase the chances of losing one's job is fundamental to the whole question. Perhaps it is a head-in-the-sand attitude. Certainly I believe it to be so, and I think that most of your Lordships would agree. But until we recognise it for what it is, and until we recognise it with sympathy and even with compassion, we have no chance of putting these attitudes to rights.
The fact of the matter is just this: this country could have more jobs and more productivity. What it cannot have is less productivity and more jobs. Any industry which consumes more labour than its foreign competitors in making a similar product will inevitably be unable to sustain itself, and so the jobs will disappear. And it is no answer at all to think in terms of import restrictions or Government subsidies. So we in this country must embark on a sustained campaign to get these factors across. The British Institute of Management is doing considerable and admirable work in this direction. That is good, but it is not nearly enough. Government employees, and particularly the trade unions, must do it as well, for without an increase in output per head we shall find ourselves slipping ever further down the standard-of-living league.
8.13 p.m.
Lord GORDON-WALKER: My Lords, it is getting late and I am getting hungry. In the public interest I have thrown away half my intended speech. To the noble Earl who has just spoken, may I say that his was an extremely managerial speech. Over-manning on new machines can be the fault of management as well as of trade unions. I remember a firm in my old constituency which introduced some expensive new machines which were going to involve a great change in working arrangements. They spent three months
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talking about it with the trade unions, and then it all went smoothly. If they had put it into force straight away there would have been a hell of a row and probably the whole factory would have conic out. I should like to congratulate my old friend, the noble Lord, Lord Roll of Ipsden. Every possible favourable thing has been said about his speech. I would only say that those of us who know him best were not surprised at the extremely good speech he made.
There has been a good deal of mutual congratulation during the course of this debate, but I must say that, especially in regard to the earlier speeches, I have never experienced such a cold douche of inspissated gloom. I can see, especially in the earlier speeches and also in that of the noble Lord, that this is one convenient way of attacking the Government when you are getting near an Election. The noble Viscount, Lord Watkinson, described this debate as being in an "electioneering atmosphere". I am sure that is so.
One matter which I do not think has been mentioned during this debate is the important factor in the shaping of the economy of the prevailing economic theory of the day. The present fashionable theory is the monetarist theory, and that has affected our fate quite a lot. Like all previous fashionable theories, such as Keynes and so on, it is suited only to the special circumstances in which it has arisen: namely, the depression caused by the phenomenal rise in oil prices. That has not been mentioned much in this debate, but it has been an important factor in the world depression. It took wealth out of the oil importing countries which has not yet been recycled. It imposed great strains on the world economy, and it created the recalcitrant and unprecedented problem of simultaneous high inflation and high unemployment. That is something we have never had before, and I am sure it is due to this special new factor. In these special circumstances, the monetarist theory has helped to cope somewhat with high inflation, but it has done nothing to reduce unemployment. Indeed, the application of the theory has led rather to an increase in unemployment.
The only countries which have escaped the more serious consequences of this depression caused by high oil prices have

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been Germany and Japan—partly because with their more modern post-war equipment they could achieve very high exports and could therefore afford to pay for their high oil imports. But even Germany and Japan have not escaped altogether from the effects of the world depression. The special circumstances that gave monetarist theories a measure of validity will change as the lost wealth is fully recycled. Then, as usual, I suppose the outdated theory will go on and be applied, and will do a great deal of economic damage.
No single country, obviously, can solve the present problems alone, and it seems to be extremely difficult to get an international solution, because no country is prepared to take the lead in reflation. We can do something—and here I support the speeches made mainly from the other side of the House—towards helping productivity by reducing taxation still further. I was very interested in the speech of the noble Lord, Lord Selsdon. I had not realised how much could be put on profits and taken away from our personal pockets. I approve of that, but we should also have to increase indirect taxation, of course, because otherwise we should never manage to balance the Budget and we should run into a huge deficit. The reason why—
Lord SELSDON: My Lords, I wonder whether the noble Lord would permit me to make a point: provided the profits are created.
Lord GORDON-WALKER: Very well, my Lords; I shall not pause. I will go on. The reason why we ought to substitute indirect taxation to a large extent for direct taxation is that people prefer taxes they are not directly conscious of and which they can, if they wish, escape by consuming less of the article that is taxed. What people do not like is putting their hands in their pockets, writing cheques, or seeing a deduction from their pay cheques. They do not like to see money actually taken out of their possession. They do not mind the same amount of money being taken out of their whisky, beer, cigarettes and so on. Perhaps this is not good sense, but it is the psychology of people, and one ought to adapt economic policy to the psychology of people. It is the only way
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we can get more out of people—we have all been talking about how you can get more out of people—and one way you do not get more out of them is to flout their psychology, and do things which they do not want you to do when you could do something else which they would not mind nearly so much.
For this reason, my Lords, I favoured the 2½ per cent. surcharge on the employers' contributions to National Insurance, together with a reduction in income tax. As the levy will be passed on to the consumers, this will be tantamount to an indirect tax replacing a direct tax, and it is a rather ingenious way of doing it, because people will be even less conscious of that tax than of most indirect taxes. I can understand the political considerations which have compelled the Government to reduce the surcharge to 1½ per cent., but I deeply regret the necessity.
8.20 p.m.
The Earl of HALSBURY: My Lords, like everybody else who has taken part in the debate, I should like to thank the noble Viscount, Lord Amory, for his initiative in placing upon the Order Paper the Motion that we have today, more particularly as a long-standing engagement prevented me from attending the debate on an associated Motion of my noble friend Lord Baker, a couple of weeks back. I should also like to add my congratulations to those of others to the noble Lord, Lord Roll, for an extremely elegant maiden speech, delivered in a style highly conformable to your Lordships' taste. I am sorry that I missed the beginning of the speech of the noble Lord, Lord Carr, because both he and I, in our salad days, used to be works managers with the shop floor as our bailiwick, and I am always interested in anything that he has to say, but I shall read the report of his speech in Hansard tomorrow.
Twenty-five years ago, when I was managing director of the National Research Development Corporation, my chairman, then Sir Alan Saunders, asked me to take the trouble to go on trade union platforms and talk to them about the inter-relation between productivity and innovation—which was very much my business at the Corporation—and its influence on employment. This I

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did, and I was given friendly invitations on quite a wide scale, as a result of which I had to work out for myself the doctrine of what I was talking about. About five years after that, I found myself President of the Institution of Production Engineers. Once again I realised that I had a job of public relations on my hands, and once more I had to work out my doctrine on this subject. There is a mental block in trying to receive this doctrine. I cannot argue my case; it would take too long and the time is late. All I can do is to pretend that I am Martin Luther nailing up his thesis on the door of Wittenberg Cathedral and state my conclusions—
Lord GORDON-WALKER: There were 94 of them.
The Earl of HALSBURY: Mercifully, my Lords, there will not be so many points in mine. I shall try to be as brief as I can about it. I start with the picture of a static economy in equilibrium at full employment. The conditions of equilibrium can then be stated quite simply. The private and corporate spendings should balance the output of consumer goods, and private and corporate savings should balance the output of capital goods. That would be static, assuming that next year's production was exactly the same as this year's. That, of course, is an unreal model. If anything happened to disturb it—and something would be bound to disturb it, because reinvestment and replacement is always on more productive equipment, so that the economy would tend to grow even if it was static to start with—you would have to manage four things.
You must have a policy for employment. How are you going to transfer people across the economy, from one kind of employment, such as the production of goods, to another kind of employment, such as the discharge of services—redeployment? You must have a policy for unemployment if it happens. You must have a policy for innovation and productivity, which should be linked to your policy for employment. Then you must have a policy for investment, which, again, must be linked to innovation and productivity. Any attempt to settle policies for these things in isolation from one another can only produce progressive
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disequilibrium, and no economy ever is in equilibrium. It is always growing or receding, or one sector is growing at the expense of another, or the terms of trade with its trading partners are altering. It is subject to the unexpected eruption of domestic events in one country or another; sometimes international events.
If I say that no management is 100 per cent. efficient in dealing with this, I am not concerned to attribute blame. I am concerned only to isolate the cause. OPEC comes along with a 5 per cent. increase in oil prices, as the noble Lord has just told us, and the whole thing is thrown into disequilibrium. It does not follow, because the Government of the day fails to manage the situation, that it is necesssarily blameworthy. But we must all be clear what it is we have to manage.
Because of managerial inefficiency we are always in a state of either inflation or deflation, running from one to the other —inflation which may accompany or may not accompany unemployment; and deflation which certainly can cause unemployment. But, currently, we are suffering from "stagflation", in which we have the worst of both worlds—unemployment coupled to inflation. The important point to remember is that, unless we drive the industry in capital goods to saturation at full employment, the purchasing power of its employees will be reduced, it will fail to load the industry in consumer goods and the whole thing will spiral downhill with sad consequences, unless plans are concerted in advance. It is no good waiting for the unemployment figures to rise before asking ourselves: what are we going to do about it? We must know in advance what we are going to do about it.
Let us look at some of those who will suffer from it. The first casualties are the marginally employable, the not very good employees. They are the first to be got rid of, when people are being got rid of. If a man is only marginally employable, and spends the next two or three years in the dole queue, he will then be totally unemployable. That is how we recruit a small core of unemployable people to the permanent damage of society, inflicting a wound upon it. The next to suffer are the school-leavers and freshly graduated university students. It is totally demoralising for a young man to start his career in the dole queue.

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Good social work could be found for all of them. The young would queue up to do it, if they felt that they were making the world a better place to live in. There are two centuries of squalor, due to an uncontrolled, unenvironmentally-minded, pioneer industrial revolution. But if the bulldozers in mothballs are not waiting to be driven at the word of command, it will be too late to do anything about it.
The next point with which I want to deal is one which was touched on by the noble Lord, Lord Rochester, and which I want to expand; that is the difference between imaginary and real dangers. The point about the abominable no-man, in his capacity as a manning negotiator, and the abominable snowman of the Himalayas is that they both have their heads turned backwards on their shoulders, so that they can run away from danger. The reason why you cannot catch an abominable snowman is that, because he is not looking where he is going, he falls into a crevasse so that you never find him. In precisely the same way, the abominable no-man of the negotiating table runs away from imaginary dangers —that is, the creation of unemployment, due to technological innovation and rising productivity—slap into the jaws of real unemployment, due to mismanagement on the economic front, notably of the capital sector.
In case anybody needs to have this point more emphasised, think, my Lords, of all that has happened in the last 30 years. That takes us back to 1948. The war was over and demobilisation was more or less complete. We had very much the same workforce as we have now. The population has been growing only very slowly, about one-half per cent. per annum. I do not make any allowance here for immigration. Look, my Lords, at all we have now, compared with what we had then. Where has all the labour to make television sets come from? Where has the greatly expanded motor industry got its labour from? What about the boom in reproduced music, transistor radios and so on, which the noble Earl, Lord De La Warr, is so busy getting into a bad condition. What about all the computers, the washing machines, the washing-up machines, the spin driers and other things we make now. Where does the workforce come from?
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It simply comes by redeployment from more traditional industries whose productivity has been rising. It can happen in no other way. So that novelty does not create unemployment.
What does matter is the structural unemployment that occurs in the capital goods industry, because capital goods need readily accessible steel, and steel needs readily accessible coal. So that at every coalfield you have the regional problem that they are all in it together, and there is no means by which one can be redeployed into another. This is what happens through failure to manage the investment rate in relation to employment on the capital goods side. There are the groundless fears and there are the well-grounded fears, and I have always come up against a block in trying to explain this. I have explained it on union platform after union platform. I have explained it as President of the Institution of Production Engineers, at lecture after lecture in academic societies. I can get it through. I can probably get it through to your Lordships tonight. I have got it through, over and over again, to my old friend, the noble Lord, Lord Collison. He and I sat together on the North Thames Gas Board for 12 years, and he knows very well my views on this. But when it comes to getting through the barrier, it seems to stop.
That was a point touched on by my noble friend Lord Roberthall, who told us the story of how Vincent Tewson tried to put this point across but he did not seem to get it through. It gets as far perhaps as the more responsible leaders in the TUC and the more statesmenlike chairmen or secretaries of unions, but it does not get through, and that is the real problem we have to solve. It is partly connected with our union structure. It is quite different from the West German union structure. The extraordinary thing is that the flotsam and jetsam of the prewar German labour movement came over to this country after the war and took the advice of the TUC. They said, "We've got to have a grass roots reconstruction. Advise us how to do it". What they got on the advice of the TUC was 16 sectors of the economy and one union per sector. That at once solves demarcation disputes. The union takes responsibility for pay differentials, and so on. I shall not elaborate on that point because I would

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merely be repeating what I said in a debate about three or four weeks ago and I refer your Lordships to Hansard if you would like to see that argued in more detail. Why can we not take our own medicine? "Physician, heal thyself". That is our problem, my Lords. We have to try to get it across.
The best seed-bed for innovation is a prosperous, profit-making industry. No lame duck ever hatched an egg, not even if another duck laid it. I remember an old story of a chap who visited a lunatic asylum. He was rather intrigued to see one of the lunatics hitting himself on the head with a hammer. He went up to him and asked him why. And the chap said, Because it's so nice when you leave off!" We will stop doing lunatic things when we recognise what is the structure of the problem that we are faced with and the need to get this across somehow, either through a reconstructed union movement or the union movement as it now is. "To foresee is to govern". Those words were engraved on the lintel over the door to a boardroom where I have had the honour to sit for some 20 years. I commend them to your Lordships' House and to the world at large.
8.32 p.m.
Lord COCKFIELD: My Lords, may I too join in congratulating the noble Lord, Lord Roll of Ipsden, on his speech. I have listened to him on other and more informal occasions and what he says is always both interesting and constructive.
We face, as the Motion says, a very dangerous situation. It is not pessimism to say that. Unless we are prepared to recognise it and face up to it we will never solve it. The seriousness of the situation can be illustrated by one fact only. Over the last 10 years output per head has increased by a total of 20 per cent. only. That is a compound rate of growth of less than 2 per cent. per annum. If we may now translate that into actual hard cash, at the current level of earnings it represents an increase per man of £1·50 a week. Any increase in pay above that level is simply an addition to inflation. A £10 increase in pay—and I am talking about the longer term; I am not trying to single out a particular pay round—is an £8·50 contribution to inflation and a £1·50 increase in real income. That
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illustrates another point; namely, that all of our problems are in fact linked to one another, and what links them together is the dangerously low level of productivity. Inflation, unemployment, the balance of payments, arc all in the end linked to low productivity.
I want to speak in detail about one subject only; that is, the level of industrial investment. Some years ago it was fashionable to say that all we needed was more investment, and we had a great paraphernalia of investment incentives introduced. As soon as one failed another one was introduced and that produced no better result, either. It has now become fashionable—and my noble friend Lord Carr of Hadley referred to this—to say that what we need is to use our existing equipment more efficiently.
There is some truth in both of these assertions but they are essentially only the two sides of the same coin. It is perfectly true that if we cannot use existing equipment efficiently we are not likely to use new equipment efficiently, either. But equally, if we go on using old and outmoded equipment, we will never match the level of productivity of our competitors. In fact, what we are dealing with here is not a single phenomenon at all; we are dealing with an immense number of individual firms. The circumstances of these firms vary very much. There will be some firms which are already efficient, which have good labour relations and where what one needs is an increase in the amount of physical investment. There will be other firms which are inefficient and which possibly have poor labour relations, where the first thing that one has to do is to improve the level of efficiency and the labour relations.
There is therefore no single solution. There is a variety of problems, and a variety of solutions is needed. Investment depends ultimately upon four factors: First, the need for a market for the output; secondly, upon the willingness of the workforce to operate the new equipment efficiently and without unreasonable conditions; thirdly, upon the finance to provide the investment—preferably generated by the company itself, and I am going to come back to that in a moment; and, fourthly, upon the investment showing a proper return on the capital employed

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and—and this is most important—on providing the funds for its own replacement in due course.
I am not going to comment on the labour-relations side of this problem. A great deal has already been said on that; a great deal has appeared in the Press, and a great deal is known about it. I want to comment on the quite common allegation today that there is no difficulty about providing finance. There is no difficulty about providing the finance that people do not want to use. But that is not the real problem. We have lived through a period—not only in this country but also elsewhere, although it has been worse in this country—when the rate of return that is earned on capital has been steadily declining, and at the same time the cost of raising new capital has been steadily increasing. It is not surprising, in those circumstances of a diminishing return and of a rising cost, that there should be more money available than people are willing to borrow. It is only by putting those conditions right that there will be created conditions in which investment can be undertaken.
There is a job here of course for everybody to do. This is not just the responsibility of Government. It is not just the responsibility of the trade unions. It is not just the responsibility of industry. It is the responsibility of all three. So far as Government are concerned, the most valuable thing they can do is to undo a lot of the things they have done over the last few years. Indeed, one of the more hopeful signs is that in some small measure since last October they have started undoing some of these things.
One cannot expect to find drive and motivation on the part of the management—and a great deal of investment depends upon the motivation of management—with the kind of taxation regime we have at present, any more than one can expect to see the same motivation on the part of the skilled worker, if his position is eroded both by pay controls and by the pattern of taxation which has grown up, over the last few years, partly deliberately and partly as a result of inflation. So there is a real and a valuable part for Government to play here, but largely a part in taking action to put right damage which has been done.
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There is a very important part for the trade union leadership to play, because they have to bring home to their members that in the long run the wellbeing and the prosperity of their members can only come from a rise in productivity. One of our major problems as a nation is the wish to maintain a standard of living, both public and private, which is higher than our level of output justifies. This has been the source of so much of our trouble, so many of our difficulties, from inflation onwards, and this one we can only put right by getting up the level of productivity. This is one of the things on which the union leadership must convince their membership. The benefit of higher productivity in the end goes to their own members.
But, finally, there is an immensely important part for management to play here, because in the end management means leadership, and the duty of a leader is to lead. There has been a considerable amount of comment this evening about the quality of management. My own experience is that in the largest companies the quality of management in this country is as good as that anywhere in the world. It tends to get patchy as one goes down the scale but, strangely enough, one of the biggest deficiencies, and in respect of capital development one of the most important, is in the field of financial management. The number of cases where companies have come close to disaster, and in some instances have actually met disaster, because of lack of good financial management is probably greater than the number of companies which have got into a position of insolvency as a result of poor technical management. This is a very strange deficiency in a country such as this, where we have immense financial expertise, both in the City of London and elsewhere. I have raised this point because in the end the planning of investment is as much a financial operation as it is a technical operation, and investment will only come if it is planned over a considerable period ahead.
In conclusion, I want to repeat that this is a very great problem which faces us. It is one where we shall find a solution if everybody in the economy is prepared to pull together to try to find the answer.
8.44 p.m.
Lord WIGG: My Lords, it is my loss that I did not hear the speech of the noble Lord, Lord Roll of Ipsden, but it adds to the interest with which I shall read it tomorrow morning in Hansard and I most certainly echo the hope, which has been expressed by almost every speaker who had the pleasure of hearing him that it will not be long before we hear him speak again.
Also I should like to add my voice to those who have expressed their thanks to the noble Viscount, Lord Amory. He and I have known each other for a long time. I have never made the mistake, which many of his colleagues have made on the other side of the House, of underestimating the subtlety of one of the most acute political minds that I have ever met. Today is a very good example. He has earned the approbation of all of us, but of course he has provided a platform from which the Tory Party can launch its earlier attacks in the General Election—and a subtle performance it was. Perhaps it would have been more appropriate in the pantomime season because it involves the parade of a sheep in wolf's clothing. Of course, the wolf growls and makes noises for the benefit of the Tory faithful about the iniquities —endless, unnamed, catastrophic—of the trade union movement. On the other hand, should by some mischance the public be beguiled by this and a Tory Government be returned, then the wolf's clothing would go into store and the sheep would come out and the sheep would be only too willing to be very nice and very polite.
I am not persuaded by it. I am not deceived by it. I have been through it all before. I was very much struck with the speeches of the noble Viscount, Lord Eccles, and the noble Viscount, Lord Watkinson, because at the end of those speeches both of them made it perfectly clear that so far as they were concerned the only remedy for all our ills was the return of a Tory Government. The problems, however complex they may be, fade into insignificance compared with the importance of that fact.
The other thing that struck me was how often, in choosing their arguments, noble Lords were a little selective in the way they presented them. I have said on
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so many occasions over a long time something which I will say again—and I apologise to those of your Lordshps who have heard it before: Defeat never comes like a thief in the night, be it economic defeat, diplomatic defeat, or military defeat. It comes after a long period of errors, of vacillations, of lack of purpose, but no one single item can be isolated so that one can say, "It is that". My noble friend who shared many years with me in the House of Commons mentioned oil prices. But oil prices stem from the Yom Kippur war. The Yom Kippur war came about because vacillations of our Middle Eastern policy, stemming from the early fifties—the shooting up the Ismalia post office, the subsequent invasion of Suez, and so on—weakened our position to the point where the world was not prepared to face up even to the consequences to Britain of giving up voluntarily a position which at one time was unassailable and for which we had fought in the First and Second World Wars to maintain our position in the Middle East. When that went, because nature abhors a vacuum, something was going to take its place and whatever took its place was not going to be friendly to us. So we paid the price.
Again, points have been raised about the German miracle, but there has been no mention of the fact that German industry was flattened and then rebuilt with American money. No mention was made that the British public, under a Labour Government, actually imposed bread rationing to sustain the German workers, or that again millions of workers from Eastern Europe and from Turkey poured into Germany. That is the basis for the German miracle. Again, I was interested in the speech made by the noble Lord, Lord Soames, who spoke about de Gaulle refusing to let us enter the Common Market because we were strong and they were weak. But why was that position reversed? Because General de Gaulle had decided that at all costs the Algerian war had to be ended. He took France right to the barricades to bring about that fact, and when the Algerian war was ended the basis was laid for a revivification of the French economy. And so one could go on.
But what particularly interested me today was this—and one of my troubles is that I have a very good memory. My

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mind went back three or four years. If the debate had taken place then, what would have been the great motive? It would have been something not mentioned today—the Common Market. We were told from the then Conservative Government Benches, "Go into the Common Market and there will be a great capital flow from Europe into the British economy and the British economy will be revivified by our membership." Some of us doubted it, I certainly did. I did not doubt about entering the Common Market but about putting the roof on before the foundations were laid. So today the Common Market is not even mentioned, yet our problems are with us and I am not an optimist. The only reason for optimism will arise when we face the facts fairly and squarely.
I am a supporter of the Government in their current policies because there is no alternative. The noble Lord who has just spoken is right. Often the Government have to do something which makes situations worse, because of the very situation in which they find themselves. The Government have been struggling since 1974 to liquidate the appalling problems that they inherited from the previous Conservative Administration, including those in the realm of labour relations. They have successfully done it, but in doing it they have paid a very heavy price, and the country has paid a very heavy price.
Now the issue will be: what are we going to do in the future? The facts have to be faced, and not the facts which are convenient to us. We cannot be selective; we cannot pick out one and say we will do that because the answer may be attractive to us. We have to face the facts fairly and squarely. In my judgment, this country—indeed the Western world, but this country in particular—is facing a revolution. I was particularly glad that the noble Lord the Leader of the House mentioned the action the Government were taking about electronic automation. I do not believe that the consequences of this are being squarely faced by the country as a whole. It is indeed gratifying to think that the Government have at least done something.
To my mind, for a long time it has been clear, to all those not blinded by refusal
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to face what is basically an unpleasant political fact, that the rapid and remorseless advance of electronic automation has caused large-scale, long-term unemployment to become a permanent feature of our society. It is something that is here, is growing, and will continue to grow. Its unpleasant consequences are plainly visible. It is a process that cannot be reversed and it cannot be wished away. Unfortunately, there is a very convenient counter-argument, namely, that automation in some form or other has been with us for a long time and we shall no doubt survive its consequences as we have done in the past. I believe that argument to be utterly false. The falsity springs from a failure to distinguish between mechanical and electronic automation.
It can be argued that mechanical automation started with the introduction of the power loom and reached its peak with the development of the assembly line techniques of Henry Ford. That development covered a period of increasing prosperity, and its consequences therefore were hidden. It must be noted that the development and spread of mechanical automation took place within the context of a basically expanding economy, and, its impact was consequently cushioned. But the pace and extent of its development was always limited by another major factor, which is not operating today, by the fact that the equipment required for mechanical automation was large, it was heavy, and it was extremely expensive.
On the other hand, electronic automation, which is revolutionising our society in front of our eyes, is not simply a continuation of the development of mechanical automation but is an entirely new phenomenon, distinguished from its predecessor at every point. The basic equipment of electronic automation is small, it is light, it is portable, it is very cheap and it is becoming progressively cheaper. It is capable in principle of being made to control, almost entirely unsupervised, almost every activity by which men and women may earn a living. Because it is so small and so light, many firms engaged in producing it find it economical, for example, to fly components to the Far East or to other areas where there is cheap labour to be found, have them assembled there by the cheap local

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labour, and then fly the finished product home again. The characteristics of smallness, lightness and consequent cheapness are being progressively extended into the equipment which the central devices control. I am told—and I make it plain I am not an expert—that purely electronic machinery is itself much smaller and lighter, and indeed simpler, than its mechanical equivalent, and it is these factors which make it much cheaper to run, because the reduction in the number of moving parts makes for a drastic reduction in power consumption.
Electronic machinery is also far more reliable. Most striking is the claim now being made for micro-processors that if one had been switched on at the time when Henry VIII married his first wife, and had been left running continuously since that time, there is a 95 per cent. chance that it would not yet have made a mistake. The micro-processor is at the heart of the automation revolution, and it is in fact the entire central mechanism of a computer which is usually, so I am told, called the micro-processor, since it is that which carries out all the arithmetical operations and related functions. It is now made by etching the whole of the circuitry on to the surface of a chip of silicon about the size of one's thumb nail.
The implications of this were vividly illustrated by the experience of the friend who acts as my mentor in my endeavours to understand electronic automation and its consequences. He tells me that the first computer which he had was a Ferranti Mark I*, itself the first major achievement of the British computer industry. It occupied a room with 1,000 square feet of floor space and required 27 kilowatts of power. My friend, now having retired, has bought a Hewlett-Packard computer 9815. It cost him about £2,500, which has to be compared with the nearly £100,000, at the then value of the £ in 1954, which was the cost of the Ferranti machine. It is about the same size as a typewriter, is as powerful as the Ferranti, and will even store as much information as the Ferranti did. At the heart of the Hewlett-Packard is a micro-processor, and the entire machine, including the magnetic tape and printer, requires less than 150 watts—about as much power as is required by a fairly large electric light bulb.
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Considerations of cost, power, size, weight or portability no longer present any barrier to the application of these devices to automation in any field in which it is introduced; and above all, making that difference which is fundamental in kind and not merely one of degree, is the fact that the micro-processor, being a computer, may be programmed to control any task to whatever degree of autonomy is required. If a programme can be written to describe what the device must do, the device will do it.
The consequences of this are revolutionary, for the only people who can now consider their livelihood to be safe for the foreseeable future are those connected with the handling of physical objects—postmen, dustmen, butchers, garage mechanics and the like. Even some of the workers who may think they are immune will soon be feeling the first chill, which stems from our refusal to face up to the logical consequences of the processes which are making nonsense of our current political and economic thinking.
The point I am seeking to make is illustrated by the fact that there is currently in the course of development an electronic arm, computer controlled, which can assembly eight typewriter components in 45 seconds, and developers are working at the development of command languages for the control of such processes. Because the components are so cheap a great deal of development work is being undertaken by enthusiastic amateurs who can, at negligible cost—since they do it for pleasure—produce new applications, many of which will most certainly be taken up commercially.
It has just been announced that the Government are proposing to invest about £50 million in the development of domestic micro-process industries to counter the present American domination of the market. In my view, and in the view of those who advise me, this is too little and much, very much, too late. Even if it is successful its main consequence will be the addition of another shovel to the digging of Britain's economic grave. It does not really matter who makes these devices, the steady erosion of employment possibilities stems not from their manufacture, but from their application. By the same token, it is pointless for the

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so-called Think Tank to consider the problem which the Prime Minister, I understand, has just ordered it to consider. There is little for the Think Tank to think about except the social and economic implications. The decisive events have already happened and cannot be reversed. Moreover, the growth of automation is on a world basis, so a 20th century Luddite Movement in Britain would be more than a waste of time; it would hasten national suicide.
There is no comfort to be derived—indeed, there never was—from the notion that those who are displaced by automation can find employment in design and construction of the machinery of automation, since that task in itself is being progressively automated. The prospects may thus be summed up. It can now be assumed that any task which would in principle be performed by or under the control of electronic machinery will presently be so performed. Because the basic devices are so cheap the development costs in any given case may be relatively modest, and many activities now being undertaken by do-it-yourself enthusiasts will most certainly be taken up commercially. If, as a last refuge, it is hoped that a particular activity may be safe on the grounds that the task of writing the basic computer programme for controlling it is too difficult, then there will always be suitably equipped individuals who will undertake the task of solving that problem for the intellectual pleasure of doing so.
I apologise for detaining your Lordships, but during the Recess I went to the United States of America. I went to two great cities of the North-West: Seattle and Vancouver. Seattle has the advantage of containing within its boundaries the Boeing factory. In those two great cities there is 20 per cent. unemployment. Many young people with university degrees will never work again because there are no jobs for them. A Ph.D. who has a job cleaning shoes told me that she considered herself lucky. That is the picture. That is the mirror in front of us. It is a challenge not of words, but of deeds.
I do not anticipate for a moment that any of your Lordships will take any notice of what I say. So be it. I am quite used to that in different fields.
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However, I have studied this matter; I have tried to understand it and I do not believe that I shall be performing a duty either to this House or to the society which I have tried to serve during my political life, if I did not spell this out. The dangers are not dangers over the horizon; they are dangers that are present now. They can only be tackled and turned to our advantage to the extent that we understand them. That is my apology for detaining your Lordships this evening.
9.5 p.m.
Lord MOTTISTONE: My Lords, it is a great pleasure that for the first time out of the many times that I have followed the noble Lord, Lord Wigg, in debates in your Lordships' House, I am able to say that I very largely agree with practically everything he said towards the latter part of his speech. It has been my good fortune to be associated with electronics in the past, and 10, 15 or 20 years ago one was studying the sort of implications that the noble Lord has been telling us are just around the corner. I would not be in the least surprised if he were not absolutely right, although personally I do not think that it will come about quite as quickly as he thinks. It will certainly come within the next 25 years and, as he said, it is something that we must take very seriously.
I must, of course, thank my noble friend Lord Amory for putting down this Motion. As many other noble Lords have said, he has put his finger on the most pressing problem for this country today. The speeches which we have heard have indicated the seriousness with which so many noble Lords take this subject. I should also like to congratulate the noble Lord, Lord Roll of Ipsden. I thought that he delivered his maiden speech very well. Indeed, it was an excellent speech. It will be even more fun to hear him when he does not feel in any way inhibited by the convention of not being controversial. Let us hope that we hear the noble Lord again in the future.
I hope not to speak for long, because so much of what is important has already been said. However, I should like to draw attention to one or two points which I believe to be particularly important,

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and some of which have not perhaps been given the emphasis that I think they should receive. I do not propose in any way to deal with all the ideas about why the present situation has come about. Apart from the fact that I am not nearly so knowledgeable as those noble Lords who have spoken, I think that all possible explanations have been covered, and if we read Hansard tomorrow and put them all together we might get some idea of the causes. Nor do I seek to spend much time giving advice to the Government, because that has been given in good measure.
However, I should like to take up a point made by my noble friend Lord Soames. It really is time that Governments—I am not being Party political—told the absolute truth. I am not saying that they are deceitful—although my noble friend did so—I am saying that for many years people have been misled by hopes of what might come about if this, that or other Government action were taken. It is part of the paraphernalia of politics to make those kind of promises, and I should not have thought that this was the time to continue with that type of thing.
I should also like to suggest to the Government generally that they should steer away from over-centralisation, not only in the Government themselves, but in all the bodies which they encourage—the trade unions, the CBI or whatever. I notice that the noble Viscount, Lord Watkinson, has stepped out of the Chamber; perhaps he thought that I was going to anger him. I must confess that I do not particularly agree with encouragement for things like the sector working groups, and in my view we have too much over-centralisation.
I should like to turn your Lordships' attention to one or two basic things at the working levels. My noble friend Lord Cockfield said that we are looking at a great many individual firms, all with different problems. I would strongly agree with that. I would go further and say "Let us look at people". We are talking about how to improve productivity and although, of course, some of that is in improved processes of mechanisation, much of it is in improved contributions by people.
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First, what worries people more than anything else at this stage is job security. Job security is very difficult to match with improved productivity. It seems to me that this is a fundamental difficulty which we must grasp. I know of one or two firms which are already toying with the idea of some sort of guaranteed employment to relatively long-serving employees, which matches the Japanese idea which the noble Lord, Lord Kaldor, mentioned. Maybe there is room for something there, but it will be difficult to apply.
The next important point is that people require incentive. Incentive for many people, particularly for those who are even moderately skilled, is matched with improving differentials when it comes to the pay figures. I should have thought that in particular we want to realise that this is a very important factor. if people are to work more skilfully, they will require to feel that they are being rewarded for it. Even if they are not being rewarded they need to feel it, and that is not as bogus as it may seem.
The next point I would raise is the dullness of de-skilled work. The tendency of all the modern equipment, particularly the sort of electronic machinery to which the noble Lord, Lord Wigg, referred, is that it de-skills the job for the ordinary person. This is dull to an extreme, though surprisingly enough there are some jobs which seem terribly dull to me —and I expect they would to most of your Lordships—but which seem to satisfy, in particular, women workers very well indeed. Therefore, it is not an impossible problem. However, job satisfaction is obviously important. The noble Lord, Lord Collison, touched on this by explaining how agriculture has, almost uniquely, been successful in developing its productivity. I think that in the last resort—and there may be great friendships between farmers and their employees, but that is another factor of very small units on which I shall not touch—it is also due to the fact that they work in much more congenial surroundings. What is more, the average farm worker has a great measure of independence in which he can use his own initiative and skill in the way he thinks best.
The next point I would touch on—it has been touched on, although I do not

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think nearly enough—is the problem of the middle managers and the need for their authority to match their responsibility. I do not want to talk for too long to your Lordships, and I can expand on this for a very long time, but the fact of the matter is that because it obviously suits the trade unions to talk to top management of larger firms when they can, this has the appalling effect of reducing. and in some cases removing, the authority of the middle manager. This is not only bad for him in the sense of his own personal amour propre, but is also bad for his authority with his subordinates. This is very serious. It leads me towards the solutions to these problems.
I would have said that the most important one—which, again, has been touched on and which has come up in your Lordships' House in other guises—is participation. There is no doubt at all that to increase measures of participation within firms must be effected if we are to organise things in such a way as to get the maximum contribution out of all the people who work with us. I say who work "with" us rather than work "for" us. However—and this is an important point—in the experience that I have managed to gain in that field it is not something that can suddenly be switched on by the flick of a switch; it is not something that can be suddenly enacted by new legislation. It is something that has to grow from within. The best company that I deal with has reached its present state, which is ahead of most people but not by any means of all, after seven years of painstaking hard work, experimentation, education and improved communications. It is something that it is improving all the time. But it does not believe that it would have got this far if it had not been painstaking, slow, and working, as it were, from the bottom upwards.
There is a great problem. We are in real trouble. Things have been allowed to drift. People have false expectations as to the possibilities of various solutions, political and otherwise, which have been put before them. But the reversal of this process, the improvement of the situation, cannot take place overnight because attitude changing is involved and that, in my experience, takes a long time—perhaps as much as seven, eight or 10 years. From what one would gather from many
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noble Lords who are much more knowledgeable than I am, we have not got that time to play with. Although on the whole I am an optimist, and I am quite certain that in the last resort we shall sort it out somehow, I am not very happy on this particular occasion on this particular very serious subject.
9.15 p.m.
Lord ROBBINS: My Lords, the hour is very late, but I cannot resist the temptation to take 30 seconds to congratulate my dear friend, the noble Lord, Lord Roll of Ipsden. Lord Roll began his career as a professional colleague of mine. He was a professional economist. Since that time he has filled a great variety of distinguished positions, but I think those of us who listened to him this evening will realise that as regards his first specialisation, his hand has not lost its cunning.
I only wish to underline certain points which have been made in the course of the debate, although perhaps not exactly from the aspect in which I suggest they need footnotes. I do not need to underline the fact that the problem which the noble Viscount, Lord Amory, has raised is a real one. The statistics which have been adduced at various stages in the debate are evidence enough of that. At the same time I am sure that your Lordships would agree that it is also a very complex one. Evidence of our virtually stationary productivity is unmistakable, if one takes average or global figures. But we must not ignore the fact that not all branches of economic activity are behind the rest of the world. The City—dare I say it?—still earns massive additions to our national income by its export of invisible services. Agriculture, as many noble Lords have said, shows a degree of prosperity and productivity which certainly would not have been expected in the 1920s or the 1930s when, because my father was President of the National Farmers' Union, I used to be in quite intimate touch with that industry.
As regards tourism, while doubtless some of that is due to the extreme cheapness of the pound sterling and the desire to see the vestiges of our historic past—so often neglected by Ministers of both Parties—I think too it may be urged that the excellence of our performing arts in the opera, ballet, theatre, and concert

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halls adds quite considerably to our balance of payments in that respect. Although our main preoccupation is with manufacturing industry it is surely mistaken to regard all manufacturing industry as being equally below par, or in fact not equal to or ahead of manufacturing industry elsewhere. Think, for instance, of the performance in recent years of GEC.
There is no doubt that the main problem is in manufacturing industry, and the statistics which have been cited are overwhelming evidence of that. As for the causes, it is desirable to emphasise the point made by several noble Lords; namely, that the explanation which was fashionable a few years ago—a gross deficiency of investment as a percentage of the gross national product—is fallacious. Doubtless it would have been better if investment had been greater, but investment considered from that statistical aspect is not so much worse than it is in other parts of the Western World.
There are three groups of causes which need enumerating and which fall under the headings of restrictive practices, management and government. I will not dwell on the subject of restrictive practices. The noble Lord, Lord Lee of Newton, declared, I think to the astonishment of the House, that in his industrial experience he had never come across a restrictive practice. I am sure that if he wandered along Fleet Street when the national newspapers are being printed he would come across examples of demarcation insistence which might surely be described in that way.
Indeed, I would say that quantitatively considered, if by a wave of the wand, which is utterly impossible to conceive, the restrictive practices prevalent in various parts of manufacturing industry were suddently abolished, it would not be out of the question to think of, say, an almost continuous increase in productivity. The dictum of the head of Ford's that there was 25 per cent. spare capacity in his establishment may perhaps be regarded as an exaggeration of the state of affairs which prevails elsewhere, but I would certainly not think 15 per cent. an exaggeration.
So far as management is concerned, there are only two things which need emphasising and the first is to dispel a fashionable mythology. The publicists
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who enlighten the listeners on radio and sometimes on television occasionally suggest that the deficiencies of management can all be explained nowadays in terms of class, the "old boy" network and so on. No one in his senses would contend that influences of that sort were not prevalent 50 years ago and no one would contend that they do not play any part at all now; but I suggest that those who brandish that explanation as the main explanation of the deficiencies of management are several decades behind the times. Many of the leaders of industry nowadays have come up the hard way; lawyers, accountants and engineers are conspicuous figures in the running of industry, efficient or inefficient, today. I say, inefficient or efficient. I am inclined to believe that in the best companies the efficiency of management is comparable with the efficiency of management elsewhere. But what I would also urge, and what was, I think, touched on by the noble Viscount in introducing his Motion, is the overall deficiency of first-class talent in management as compared to elsewhere.
Only a fortnight ago, when speaking on the Motion introduced by the noble Lord, Lord Baker, the noble Earl, Lord Gowrie, reminded us of a sample investigation which he and his wife conducted a couple of years ago, in which each person enumerated the 20 people who, at university age, had impressed them, respectively, both in this country and in Germany. The result of the sample was that, of the 20 most impressive people in Germany, 10 had gone into industry, whereas in Lord Gowrie's own sample, of the 20 most impressive people he had known at university age only one went into industry. That was a small sample. However, having during a considerable part of my life been associated with higher education in one form or another, I think that there is something in the reproach. It would take a long time to analyse. I am not sure that I should be capable of doing it. I think that there is something in the atomsphere of higher education in this country which is inimical, for some sensitive people who otherwise would do very well in industry, to their considering such a career.
Then, finally, Government. Your Lordships will have heard quite enough, by this time of the evening, about taxation.

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I feel moved, however, to add this footnote. So many noble Lords on this occasion, and on occasions when we have discussed these matters previously, have insisted in broad terms on the overwhelming weight of our taxation as compared with that of other Western countries. That is a misapprehension. Taxation indeed poses special problems in the shape that it assumes in this country. But the general burden of taxation has not compared so badly with that of the other Western countries. What do compare badly are the high marginal rates of taxation, which means that above a certain income there is almost no incentive in seeking an increase. Last week we saw the less reputable organs of public opinion exhibiting their true nature by referring to the recommendation of the Boyle Report to remedy obvious injustices—gross instead of net figures, which makes all the difference in the world.
However, enough of taxation in that respect. I wish to say a few words about the threat to investment. Taxation is levied not only on earnings; it is also levied on income from wealth. In that respect, in the higher reaches—up to 98 per cent. of income—it is, in my judgment, a standing temptation to consume wealth, rather than to create it. I also wish to draw attention to the effects on the disposition to invest of threats to nationalise still further sections of the economy; threats to nationalise the City; threats—which I was pleased to see were slightly discounted from the Government Front Bench this afternoon by the noble Baroness, Lady Stedman—to nationalise, in some form or another, the construction and building industry. I cannot forebear to comment on the fact that the method of compensation adopted in the last round of nationalisation—a method which was the subject of serious warnings in this House from some of us who had no conceivable financial interest in it—was bound to lead to trouble; and trouble has arisen. With one thing and another one cannot wonder that more lively spirits in this country are looking for companies in which to invest which have interests abroad and which are not so likely to be interfered with as interests in this country. Furthermore, some of the younger of these people, whom I know, are looking for jobs in that direction.
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The noble Viscount, Lord Amory, was surely right to emphasise the points to which he drew our attention. Productivity is surely not the only matter which is wrong in this society or in others which one can think of. But productivity is the source of income. There is precious little superflous cash to be gained now by squeezing the rich. The investigation of Professor Henry Phelps Brown, and the figures produced by the invaluable Diamond Commission are incontestable evidence of that fact. I agree with the noble Lord, Lord Cockfield, that in so far as there is pressure for money incomes the real value of which exceeds the real value of productivity, the result must be either further inflation or further unemployment.
9.34 p.m.
Viscount ROCHDALE: My Lords, first, I wish to thank my noble friend Lord Amory for introducing the debate, and I also want to add my sincere congratulations to those already extended to the noble Lord, Lord Roll of Ipsden, upon his magnificant maiden speech. Like other noble Lords, I shall do my utmost to curtail what I had planned to say, and I propose to confine my remarks largely to matters concerning people. So much has been said about productivity that one might think that there was nothing more to say; yet I would venture to suggest to your Lordships that, in talking about increased productivity, we want to remember the effect of fear that it may have on a large number of people who may misguidedly think it will do them harm. They fear that, with higher productivity, unemployment will rise (and, as noble Lords have pointed out, it probably will) and they will lose their jobs; and they fear that, even if they keep their jobs, with lower manning scales they will perhaps have to work harder—a fact that is probably quite the reverse of the truth.
I suggest that what higher productivity may well mean for those people still in work is better directed, better planned, steadier work, without interruptions for whatever reasons they may come. It will mean, of course, the acceptance by the individual of the need for change which may affect him; it will also mean the acceptance, all round, of a degree of collective discipline and pride to achieve the improvement sought. Indeed, I think

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that, for some, the workload may even be lighter with higher productivity. The success or failure in this direction will of course depend primarily on management. Although unions, too, will of course have a big responsibility here, it will rest primarily on management, and on whether management can engender and justify the confidence and trust they need if they are going to be successful in managing. I have no doubt at all that we in this country have the brains; we have the inventive genius; we have the skill (latent though some of that may be, but that is another question altogether); and, as many noble Lords have said, we have the cash for investment. What we seem to miss, somehow, is the something which will weld all those assets together so that we can take full advantage of them.
There is nothing new in all this, and there are a great number of people up and down the country who spend the whole of their time trying to solve these problems in industry. That brings me to one of the main points I want to mention. I think we want to be very careful indeed to make sure that in referring, as the Motion does, to "the dangerously low level of productivity "—and that, of course, is true in certain industries—we do not condemn the whole of industry; because nothing would go further towards discouraging those who are doing an enormously good job for work and nothing is more likely to lower productivity than to have to work in an atmosphere of discouragement. There are, of course, a number of firms who have a very dangerously low level of productivity. The trouble about that is that they are the ones which hit the headlines and tend to qualify the opinion of the public in general about what is going on in the whole of British industry; and that, I think, is harmful and not at all helpful to what we all seek. Indeed, I think it is sometimes a source of astonishment to our competitors overseas that we allow this terrible picture of ourselves to emerge in the way that it does. I am sure that many things go wrong in industry in other countries, but we do not hear of them nearly so frequently or so pointedly as they do of ours.
There are, of course, industries which have a low level of productivity for reasons not always of their own making —maybe worldwide conditions. There
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are other industries which apparently have ideal circumstances in which to live and yet seem unable to make a success of high productivity. I need not mention them; they are all too often in the newspapers, as they have been recently.
But there are certain problems common to all our industries and I should like to say a word on them. Inflation has been mentioned, taxation has been mentioned, price control and other forms of control have been mentioned, all tending to make it more difficult for management. But what I want to refer to particularly, a very much more sensitive area, is what I describe as the social legislation relating to industry, the legislation that relates to employment, conditions of pay, safety and health at work, redundancy and so on—largely a Government responsibility. I know that I am treading on very delicate ground here; but I wonder whether, in our straitened circumstances, we have tried to go rather too fast with some of this legislation, desirable as it may be in itself; so fast, in fact, as to make recovery more difficult than it need be.
I suggest that those of us who, in either House of Parliament or in Government, can in any way feel themselves responsible for legislation of this kind or can influence it in any way, need to be very careful that in trying to stop up every crack and to close every loophole to deal with the irresponsible minority in industry—and when I say "irresponsible minority" I am referring to the irresponsible and thoughtless management section of industry—we are not succeeding in creating for ourselves something of a straightjacket which, in fact, impedes the efforts for the majority to surge ahead.
I know that I am laying myself open to being accused, possibly, of taking a callous view of what should be the circumstances in which workers work; but that would be absolutely wrong. I would be the last to take a carefree or thoughtless attitude, for instance, to health and safety at work and related matters. I would believe that most employers in this country take a pride in feeling that they are perfectionist in this aspect and try to do their best for their employees. But it leads me to suggest that there are certain questions on this type of legislation which we want to ask ourselves. There is a vast amount of it: so much that a great deal—and some figures on this have been quoted

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this afternoon—of management's time and, particularly, senior management's time has to be spent on dealing with legislation, seeing whether the company is complying with it, seeing whether, in fact, it can be complied with in their specific circumstances, when that management should be spending far more time on producing, on selling and on tryng to get away from the obsession of dealing with these internal domestic problems and not on looking outwards, overseas, to much wider markets and opportunities which is their real function.
The two questions on this legislation that we ought to ask ourselves are: whether we should aim our legislation for industry on minimum standards to eliminate the least satisfactory and most objectionable practices in management; or whether we should aim that legislation to set standards which are really perfectionist targets for all to try to achieve. I believe that if we aim for the latter we may be, in fact, making things more difficult for management. The second question is whether the bias in our industrial legislation should be directed to helping industry get on with its work or whether it should be directed to safeguarding the consumer against the alleged abuses of industry. There could be a fine balance between these two alternatives, but they are not necessarily incompatible. Personally, I think in the situation in which we find ourselves in industry today we ought to go for the least restrictive forms of legislation on management.
If that is so, it means that we have to be prepared to place greater reliance on an individual's judgment and less on the fear of legal sanctions. It also implies that in industry, as never before, we need a far greater share of the cream of our your men and women coming into industry, and we should do everything possible to encourage that. The noble Lord, Lord Robbins, who spoke just before me, mentioned this point.
Noble Lords may have noticed that for some weeks now I have had in the Minutes a Motion under "No day named" on this very subject. I hope that some time we may be able to debate that Motion, which is broadly to encourage young people to want to come into industry, to help them and give them a proper image of industry so that they will
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do so. I believe that there are many who would share my view. I do not know when we can debate this subject, but perhaps we ought to spend some time in digesting the tremendous debate that we have had today. An opportunity may come in the autumn; at any rate, I hope so. It may be that getting more of the cream of our young people will be advantageous in the medium and longer term—and we have also been discussing today the shorter term—but it is important that we should try to get the very best of our young people into industry. There can be no doubt about it; there is an inhibition on this today.
The noble Lord, Lord Rochester, with a Motion on 9th February 1977 initiated a very interesting debate on this very point. I read it right through from beginning to end recently. I like to think that certain action has been taken as a result of that debate. That excellent organisation, Understanding British Industry, has developed further on this and I should like to congratulate the Department of Industry Which produced a most valuable discussion paper last June, entitled Industry, Education and Management. That goes to show that this is a subject about which people are well aware. But we cannot leave it there; it must be pursued. In days gone by when industry was simpler and we had captive markets, the problem was a far less acute one for industry. But today the priorities and pressures have changed, and unless industry can rely on a solid background of our most able young men and women, we shall neither have the planning nor the provision of the most suitable and advanced equipment, nor the ability to administer this to the best advantage.
That leads me to my last point: today in our young people we have an impressively acute social conscience. Industry wants to build on that. We need to project an image of industry to them so that they will come to recognise that there is no better way of serving their fellow men—and that is what so many of them want to do—than a career in creative industry. If they use their technical and administrative knowledge, they can also do something else: they can establish a real sense of community purpose, which in my veiw is needed more than anything else for achieving the high level of productivity which my noble friend and all of us desire.
9.50 p.m.
Viscount TRENCHARD: My Lords, may I, in all humility, add my congratulations to the noble Viscount, Lord Amory, on introducing this fascinating debate, and to the noble Lord, Lord Roll, on his magnificent maiden speech. Anyone put down to bat at No. 29 clearly should not be playing at all, particularly at this hour of the evening. My one consolation lies in remembering that bowlers are put in late in the batting order!
Everybody has agreed about the enormous importance of this subject and there has been, at any rate to me, a note of gloom. I suppose that because of the great importance of the subject and its huge size, people are inclined to find it very hard to suggest that there is certainly not just one cure but even any set of measures which can produce a cure in time. Let me try to reverse some of the gloom and say again what the noble Lord, Lord Roberthall, quoted me as saying in a previous debate: that there really is no reason why wage-earners in this country, and indeed in the whole community, should not double their standard of living in little over a decade. And if we did that we still would not have caught up Germany, of whom we were ahead not so many years ago. So there is real self-interest at stake for every one of us and for every trade union member.
I believe that the "British disease", as it is called—it exists abroad but is less virulent—has been caused by our wandering away to a greater extent than other people from an economy regulated by market values. I think the distance from market values to which we have wandered in Great Britain can best be illustrated by doing a little arithmetic as to what would happen tomorrow if, as far as possible, wage-earners in various economic activities were paid according to the comparative productivity of their industry with their main competitors in other countries. I think that we should find that farmworkers, who have been well mentioned today, would have double the current pay; and, even thinking of the relatively small percentage of labour in farm costs, if you doubt the ability to do that, you have only to remove those market value interferences, namely, the false exchange rates and the green pound,
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to enable farmers to do it quite easily and to make a very good profit.
On the other side of the equation, I think it is quite clear from the statistics which have been quoted today that, according to market values—at least as judged by productivity, often in the same firms with the same equipment—there are areas in our large employment industries, our car industries and others, where some should be earning only half. I am not suggesting that one can, or even that it is desirable to, get back at a stroke to an economy regulated by market forces; it is obviously impossible. But I believe those differences are far greater, certainly than in more successful competitor countries.
Clearly this diagnosis is completely different from that advanced by the noble Lord, Lord Kaldor, today and, two weeks ago, by the noble Lord, Lord Balogh, during the very interesting debate which was introduced by the noble Lord, Lord Baker. Both of them trace our industrial decline from the last century, and tie it to the degree of import penetration. They tie our relatively successful short periods to the degree of protection.
The first thing that has to he said is that the decline that we are talking about, starting 15 years ago, is so much greater than the longer term decline, as described by the noble Lord, Lord Kaldor; that we should stick mainly to discussing this appalling fall in recent years. However, there are always other correlations. I am not, I am afraid, sufficient of a student of economic history, but just as heart disease can be correlated quite closely with television sets, I believe that these correlations are very dangerous.
I believe that there was a catch-up period. After we were first with the Industrial Revolution a number of our industrial competitors tended to catch us up. There were periods when we were strong enough to get away with—and I am not against getting away with—a little protection. But there are other factors that should be taken into account. We passed legislation, in 1871, 1875, and 1906, as a result of the mistakes we had made in the Industrial Revolution, quite different from that which exists in any other economically strong country of the Western world. The next factor that

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one could bring into play is the build-up to, and the fact of, the General Strike, and let us pray that we never have that kind of thing again. Nevertheless, the period which the noble Lord, Lord Kaldor, mentioned, between 1932 and 1937, has to be taken against the background of the aftermath of the General Strike and the mild legislation of 1927. Then, of course, there was more legislation of great importance in 1946 and, again, in recent years.
I do not want to attribute the whole of our problems, because that would not be correct, to this scenario. But it is a fact that there are bigger differences between us and other countries, in the structure and atmosphere around our trade unions and our collective bargaining, than there are in any other aspects of the industrial world. I believe that economies regulated by market values do the best in free societies, for all elements of the population. I believe that, in our day, we have proved that, and that the USA, Germany and Japan have also proved it. I also believe—and I note that my noble friend Lord Amory, in introducing this debate, did not quite accept this—that our main problems in productivity lie in our large employment areas and our large factories. Most surveys tend to show this.
Of course, our large areas are very important as a percentage of the whole. This is why, when you look at sector statistics, you tend to find nearly all the sectors looking poor against European or American performance, and this is because of the weighting of the large elements in them. It will be very interesting to see the study by Professor Price, which the noble Lord, Lord Roll, mentioned, when it becomes available. Certainly, in so far as they are meaningful, the strike statistics are quite clearly in the larger factories as a whole. In my experience, it is clear that we get problems in large factories in this country at a smaller size than, say, the Germans, the Americans or the Japanese. I think that this is because of our lack of structure and of legal background in this whole area.
I am all for what has been said by various noble Lords in terms of the importance of pushing small and new enterprises. Growth is vital and the small
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and the new areas should be one of the main contributors to that. But our big areas are far too big for us to be able just to look at the small and the new. We must get our productivity right in our large employment areas; that is, if we are to maintain, let alone to improve or double, our standard of living.
There has been a good deal of talk about culprits and I will not comment on the obsession of the noble Lord, Lord McCarthy (if I may call it that), with occupational excellence. I wish that the business world perhaps still had that obsession with occupational excellence, but I think that has gone, together with many other things, and I wish we had a little more excellence as well as a little more productivity.
We clearly have good areas and bad areas for investment and there is no question that that will be found in all other countries as well—certainly in the businesses of which I have had experience. There is no doubt that we use our investment poorly. I think it has been said very clearly already by greater authorities than I that finance is not the answer. Finance available to British industry is certainly as good as to our main competitors. We must improve our management; there is no question about that. We must improve the image of business so that we get a higher proportion of the best out-turn of our education. That was covered, particularly in the technical area, very well and very fully in the debate introduced by the noble Lord, Lord Baker. For all that, it is certainly my experience that this is not the main difference, and I say that against the background of having imported management to do jobs in Britain and having exported management to do similar jobs abroad, for a considerable period of time. I cannot believe that our success areas—and they are considerable—are those where we happen to have somehow attracted all our best managers and somehow have left all our poor managers in the large factories and other areas where our productivity is deplorable.
I feel, therefore, that one cannot shrug on one side the area of industrial relations, the trade union structure and collective bargaining. The trade unions in this country have greater power than anywhere else. In many areas they are still

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exercising extreme responsibility, but a great deal of that power lies at shop floor level, and in this situation it is quite different from anything of which I have seen or had experience abroad. Strike statistics are really not meaningful and they are used often to say that we are on a par with other people. There is an economic law which means that unless you are a very rich country or a very rich company you cannot afford more than a certain percentage of strikes, so that what matters is the balance of bargaining power before a strike. The threat of strike in our "no-agreements-powerful-shop-steward-situation" in this country, is constantly pressing on the managers of our very big factories.
Let me return to management for a moment. It is very easy to say we must solve all this by having a new type of manager who is capable of consulting everybody and carrying everybody with him. Time has been mentioned today by the noble Lord, Lord Plowden, and by the noble Earl, Lord De La Warr. Various percentages of time that English factory managers must take on negotiation and discussion with unions have been mentioned and they have been far higher than on the Continent.
My way of saying this is as follows, that in a good industrial relations situation I believe it is a struggle for a factory manager to spare up to some 15 per cent. of his time actually to change things and improve things and move the show forward. If more than that 15 per cent. of time is taken up with negotiating with everybody on everything, then the show will move backward and not forward and management will appear incompetent, and over the lunch table here we shall complain about not getting our motor cars or the spare parts for them. I should have liked to say to the noble Lord, Lord McCarthy, that I believe some of the points which he attributed to management come from this problem of their not even having time to do more than half their routine duties effectively. It is a question of carts and horses. I have noticed that wherever one gets problems in large factories one of the first things that goes backwards is the speed of application of new developments. It just sticks, and that is because all the main managers are fielding day-to-day problems.
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I do not think we shall get a great deal—much as I want the subject to be pushed on—out of Neddy and the sector working parties and the productivity deals tied to incomes policies. I will cut short what I was going to say by saying that I will take a bet with any noble Lord—within my financial capacity, which is not very large—that when we get the production statistics out for the Phase 3 period we shall find that two-thirds of the productivity deals have in fact been bogus. I do not mean that they have been fraudulent; they have been put in with the best intention in the world; they have been justified to boards of directors of important companies and then with the CBI and the Department of Employment. But in fact I have seen a good deal of this, and I will take a bet that at least two-thirds of those deals will not be matched by extra production per man.
Participation can play a main part, and the only comment one must make is that we should take the opportunity, while encouraging and pushing on with participative management, to make sure that it and industrial democracy are based on true democracy, either on well-controlled, regulated democracy of all employees, or that we use the opportunity to suggest that where they are based on trade union organisation, where that is very strong, that we ask trade union leaders to make sure that regulated true democracy is practised in those unions.
I will end with three quotations: two academics and one trade union leader. First, Professor Hayek:
"If we want to preserve the market economy our aim must be to restore the effectiveness of the price mechanism. The chief obstacle to its functioning is trade union monopoly. It does not come from the side of money, and an exaggerated expectation of what can be achieved by monetary policy has diverted our attention from the chief causes. Though money may be one of them if it is mismanaged, monetary policy can do no more than prevent disturbances by monetary causes. It cannot remove those from other sources."
Frank Chapple, in an open letter of May 1977 to the Reader's Digest, said:
"British trade unions have long enjoyed legal immunity for many of their actions, and recent legislation has given the movement unparalleled privileges. If we are to live up to this new status we must work for a corresponding increase in democratic responsibility. Yet while Parliamentary democracy has developed scrupulously regulated machinery for electing and removing

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MPs, unions have clung to antiquated or rudimentary electoral procedures that bear little relation to 20th century thinking."
Professor Beresford Dew, of the University of Manchester, speaking on German trade unions and the evidence they gave to a recent inquiry said:
"Their dedication to the profitability and the productivity of the firm, their insistence on the firm's need to accumulate capital through profits"
is what struck him more than anything else. I believe we can quite easily double the standard of living in this country, and I do not think it would take much more than a decade, if trade union leaders would go with industry leaders to study the positions abroad, and to recommend reforms not to copy but to parallel those systems.
10.10 p.m.
Lord McCLUSKEY: My Lords, may I briefly but with warmth echo the thanks which many noble Lords have expressed to the noble Viscount, Lord Amory, for raising this subject, and also the congratulations expressed by many to the noble Lord, Lord Roll of Ipsden, for his dispassionate, eloquent and informed speech. The noble Lords, Lord Gordon-Walker and Lord Wigg, thought they detected a political motive behind some of the speeches in this debate, and the presentation of this debate. Be that as it may, I believe the debate itself has been essentially constructive and non-partisan, and I believe there has been an almost total absence of carping criticism of any one particular group or body, whether it be the Government or the trade unions or management or investors or whatever.
It is my privilege to reply, as briefly as I can, to this rather long debate, on behalf of the Government. I cannot hope to answer every single point, and indeed some of them I do not require to answer because they have been answered in the course of the debate, or were anticipated by the Leader of the House when he spoke at the beginning of the debate. In that speech my noble friend Lord Peart drew attention to the importance which your Lordships would place on the need for an improvement in the international competitiveness of British industry. He outlined the work being undertaken in the Industrial Strategy
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programme. It is a fact that the economy has been moving along an uneven path of recovery since the autumn of 1975. We need a stronger expansion, as does the rest of the world. We must try to avoid the sharp but short recovery seen in some past cycles. We need a sustainable expansion, and this is what we are working for.
The noble Lord, Lord Carr, noted the limitations of the Industrial Strategy—and indeed he has been echoed in that respect by the noble Viscount, Lord Trenchard, a moment ago—the limitations that the Government themselves cannot bring about the much needed improvements in productivity, and that changes in attitude are necessary at shop floor level. These limitations exist and the Government have always recognised them, but the noble Lord, Lord Carr, did not appear to me to give sufficient weight to the efforts which individual sector working parties are making, their efforts to emphasise to their sectors the importance of all aspects of productivity, good design, improved product development, quality control, and limiting what my noble friend Lord McCarthy described as the shortage of hits. Of course, there is no simple solution. Each sector working party has to direct itself to the particular circumstances of its own industry. But I should not want noble Lords to consider that the Industrial Strategy is remote from the changes that need to be made, as it seemed to me the noble Lord, Lord Carr, indicated.
In this respect it is right, too, that I should acknowledge what the noble Viscount, Lord Watkinson, said, and I am happy that he spoke so warmly in favour of the Industrial Strategy, which, as he said, has been undervalued. It is true that its achievements may be slower than we would wish, but they are not slow, and they are certainly steady and they are certainly real. A number of noble Lords have expressed, in the course of the debate, comparisons in labour productivity between this country and other countries. Data problems limit the comparisons which can validly be made between sectors of industry, but on the statistics available for the 1970s it is evident that the United Kingdom has shown significantly lower movements in labour productivity only in the past few years.

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The productivity changes in a few countries have been compared between the years 1963 and 1973 for some 15 sectors. Japanese growth rates are almost invariably much higher than those in the other countries shown, probably partly because in the early part of that period at least Japan was absorbing technology already developed elsewhere; that is to say, catching up with Western productivity levels. There are substantial differences in productivity growth rates in individual sectors between the United Kingdom, France and West Germany. The United Kingdom appears to have performed particularly poorly in metal manufacture, especially iron and steel; vehicles, especially motor vehicles and fabricated metal products; but it has done well in scientific equipment, chemicals, industrial engines and electronic computers. The German performance, for example, in clothing and footwear, looks poor, while the French do not seem particularly bad in any area, but stand out as successful in mechanical engineering. So one gets an odd pattern when one looks at the details of the comparisons.
The relationship between productivity and employment is far from simple, and many noble Lords have stressed this in the course of the debate. Long-term changes in industrial employment levels are the result of the simultaneous and interacting operation of a number of economic factors. However, I believe that there is increasing recognition of the importance of productivity, especially manpower productivity, in alleviating longterm unemployment and stimulating growth. The combination of present high levels of unemployment and widespread fear that increasing manpower productivity will lead to reduced demands for labour, both in the short and long term, does not provide an easy background for any initiatives to improve manpower productivity. However, there is some evidence that, in the medium to long run, those industries which have high levels of productivity also provide more jobs.
I should like to refer to some details. Recently the Department of Employment published a survey about research on productivity trends in manufacturing industries. That indicates, among other things, that the 10 industries with the largest growth rates in productivity increased
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their employment by a net 165,000 during the period from 1954 to 1973 when total employment in the 82 industries surveyed fell by some 600,000; 124,000 of that net increase was in radio and computers. So that survey seems to point in the direction that I have indicated.
The Department is also undertaking further analysis of a selection of industrial sectors with a view to identifying interplant differences, and possibly to pinpoint the reason for the range of manpower productivity identified. It is hoped that the analysis may provide more information on the relationship between high productivity growth, on the one hand, and increasing employment, on the other.
However, overall it is, I believe, important that we should consider the problems of low productivity in a realistic, but not unduly pessimistic way. The noble Viscount, Lord Amory, referred to the fact that many more multinational companies would invest in this country if we could get productivity right. However, while it is indeed our experience that one of the first questions asked by any businessman thinking of coming to invest in the United Kingdom concerns productivity, I believe I can say quite categorically that any new firm coming to Britain can start up without difficulty at the highest international level of productivity by negotiating appropriate manning levels and working procedures.
For the new enterprise, productivity creates few problems. Indeed, there is actually an advantage just because Britain is one of the lowest wage cost countries in Europe. The Government hear from their confidential discussions with companies that there are many examples of companies which have experienced this by bringing their investment to the United Kingdom.
I should like to say a few words about personal taxation. It has been argued by several noble Lords that the key to stimulating enterprise and producing jobs is a massive reduction in personal taxation. Without going so far, in his 1977 Budget Statement my right honourable friend the Chancellor of the Exchequer acknowledged that the incentive to work may have been weakened by the effects of inflation on the tax system. He acknowledged that too high a proportion of the tax burden fell

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on income tax payers—making a point similar to that made by the noble Lord, Lord Selsdon—and tax was imposed on too low a level of income and too many people were subject to the higher rates of tax.
My right honourable friend has begun to remedy the situation, and hopes to continue to make progress in adjusting the balance of taxation and reducing the burden of income tax. Perhaps I might illustrate the point. In the past year and a half income tax has been cut by over £5 billion. A substantial start has, therefore, been made in moving the burden of taxation away from direct taxation towards indirect taxes, and the real burden of direct personal taxation has already been greatly reduced. My right honourable friend also indicated that he would have liked to do more for managers and skilled workers, who were mentioned during the course of this debate, but the increase in tax thresholds and the lengthening of the basic rate band has meant that the point at which the higher rates are reached has been raised quite substantially, more than enough to offset the effects of recent inflation.
Several noble Lords—and I think the last of them so to do was the noble Viscount, Lord Rochdale—spoke about there being too much legislation and about the problems that that creates for management. Of course, there are a number of complaints and I do not think that any noble Lord was very specific about legislation, other than perhaps the Trade Union and Labour Relations Act 1974, and the Employment Protection Act, although perhaps other noble Lords had in mind the Redundancy Payments Acts.
Perhaps I may take, briefly, these Acts. The Trade Union and Labour Relations Act 1974, as the noble Lord, Lord Carr of Hadley, will acknowledge, re-enacted the provisions contained in the Conservative Industrial Relations Act 1971. The only point I seek to make on that is, that in their approach to the problem of unfair dismissal there is nothing substantial between the two Parties. Of course, the 1975 legislation went a little further in giving the tribunals the right to order reinstatement of anyone who was unfairly dismissed. But I do not think
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that there is a deep Party political point between the noble Lords opposite and ourselves in relation to the principle of securing workers against unfair dismissal.
I should like, generally, to say something about that legislation. I believe that the fear of change—and this was mentioned by several noble Lords—the fear of unemployment and the fear of inhumanity in the ordering of our economic and industrial affairs are important factors in producing and sustaining the climate in which low productivity becomes chronic. It is surely right that these fears should be tackled by Government. Indeed, that is why I believe that both Parties, when in power, have introduced legislation of this kind against unfair dismissal.
However, having said that, the Government are certainly conscious—and I want to reply to the noble Viscount, Lord Rochdale, on this—that increasing legislative and administrative requirements impose a cumulative burden that can add both to industrial costs and make undue demands upon management time, even although the individual measures may be seen to be individually justified. So, when they come to formulate new policies, the Government must look not just at each measure, but at the totality.
I should like to give one further instance of what the Government are doing in this field. It is an initiative with which your Lordships may well be familiar. However at the Department of Industry, my honourable friend the Minister, Mr. Huckfield, has recently announced a rationalisation of the forms sent out by the Business Statistics Office. Indeed, similar work is being done under the auspices of my right honourable friend the Chancellor of the Duchy of Lancaster. I should say a word or two about industrial democracy, which was touched on recently and also by the noble Lord, Lord Plowden. He introduced the matter into the debate and criticised proposals that were, as he saw them, proposals to increase trade union power. However, he praised worker participation.
The Government's proposals for extending industrial democracy are based on the same belief—the belief that employees have a right to share in the decisions which affect them. We are also convinced that greater participation will help towards our

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objective of creating a more constructive relationship between management and workers. In achieving this goal the Government hold the view that flexibility is the key so that companies and their employees may make arrangements which they deem appropriate to their own particular circumstances. We think that a great deal can be accomplished in this way by voluntary action which builds on the structures for consultation which already exist. But we do not believe that we can altogether rely on voluntary progress, and it is for that reason that the Government have proposed that in companies employing more than 500, or 2,000 respectively, employees should have certain statutory fall-back rights to discussion of all major proposals which affect them before decisions are taken, and also to board level representation.
It is a truism, as has been acknowledged in the debate, that poor industrial relations have contributed in some way to Britain's industrial decline. We believe that one way to improve this situation is by involving people more closely in the decisions which affect them. The experience of our European neighbours, some of whom have made much greater progress in industrial democracy than we have, contains not the slightest hint that greater participation is detrimental to the interests of efficiency.
I want to say one word about work sharing because it is a matter which is certainly of interest outside the House, and because it was mentioned in several speeches in the course of this afternoon and evening. The Government see it as quite understandable at a time of high unemployment that there is pressure from the Trades Union Congress and others for measures to share work among a larger number of employees and so to reduce unemployment. But we should, however, have to be very cautious about adopting any approaches which would increase industrial costs, and therefore put at risk our prospects of economic recovery upon which the provision of more permanent jobs depends. That is why we have carefully considered the proposals for reducing normal hours and compared them with other measures to reduce unemployment, such as the special employment measures about which I shall say a word in a moment.
I can agree without qualification with the noble Lord, Lord Carr of Hadley,
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that because of the dangers to our competitiveness work sharing and reducing standard hours is best considered on an international basis. Work sharing measures are now being studied in the EEC, and it would be best to await the outcome of those studies and avoid any action in the meantime which might weaken our competitive position and damage our longer-term prospects. I believe that the social trend towards shorter hours and longer holidays will no doubt continue for future years, and rightly so, for the reason that the noble Lord, Lord Carr, said: if it is not about improving the quality of life, then what is it all about? As measures to reduce unemployment, work sharing measures do not seem to us to compare favourably with our own special employment measures.
On pay policy rather contrary views were expressed by the noble Viscount, Lord Eccles, who rather inveighed against pay policy as the enemy of increased productivity, and the noble Lord, Lord Rochester, who argued for a still more rigid incomes policy than we have had in the past. I regret what the noble Viscount, Lord Eccles, said in criticising pay policy because it has played a considerable part in reducing the inflation rate to the figure we have now of 7·7 per cent. That is a figure which is down from levels several times higher just three or four years ago. One could hardly describe the present rate of inflation, as the noble Lord, Lord Soames, did, as running wild. I think the noble Lord, if I recall him correctly, said in the middle 1970s we had inflation running wild. Certainly it was running wild. We believe that, by the pay policy, we have made a substantial move towards bringing inflation under control. For that reason I deplore the ease with which the noble Viscount, Lord Eccles, sought to dismiss it.
May I say just two words about the pay policy. It provides some limited room for adjusting differentials for skill, and the present policy also provides scope for self-financing productivity deals. The noble Viscount, Lord Trenchard, was prepared to take a bet with the noble Lord. I do not bet, and therefore I shall not follow him in that. But these schemes are examined by the Department and by the CBI. Both the Department and the CBI

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are satisfied that the great majority of productivity schemes of which they are aware, which at the moment number several hundred, are indeed genuine. It is impossible to say whether or not they are. I can only say that they have been examined, that they are examined with great care and that they are continuing to be monitored. One hopes that the noble Viscount is wrong and that if anybody takes on the bet with him he will lose.
Very little has been said about one aspect of the Motion; namely, the part dealing with new and constructive job opportunities. I should, therefore, in the few minutes remaining say something about that. The Government are using the existing means at their disposal to create new job opportunities through the modernisation of British industry. To give examples of that, in 1976–77 under Section 7 of the Industry Act 1972, no fewer than 855 projects costing over £1,000 million were supported with assistance of some £90 million. As a result, 56,000 new direct jobs are expected to be created over the next few years and a further 35,000 safeguarded.
Section 8 assistance is not specifically employment-linked; it has to be in the national interest and employment factors are taken into account. Schemes such as the accelerated projects scheme, the 14 sectoral schemes and the selective investment scheme are concerned with a wide variety of economic and industrial benefits. Even so, it is estimated that projects approved so far under those schemes should lead directly to the creation of some 22,000 jobs and the safeguarding of many thousands of others. Indirectly, those projects should safeguard tens of thousands of jobs through improved performance throughout many sectors of industry.
Finally on that point, selective financial assistance provides substantial benefits for employment through the inducement of investment and orders for United Kingdom companies. For example, the 118 projects costing some £640 million induced under the accelerated projects scheme should lead to some £500 million worth of orders being placed with the United Kingdom construction industry and plant and equipment manufacturers, with a resulting 70,000 man-years of work for
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those sectors. These are not achievements to be ignored or left out of account on a proper view of all the matters raised by the noble Viscount.
I should also say something, as I said I would, about special employment measures. We are now operating a wide range of special employment measures supporting some 310,000 people, and I need not detail them to your Lordships because I think they are reasonably well known. However, these measures continue to be developed and we expect them to be supporting some 400,000 people by March 1979. All the measures are now reviewed each year against the unemployment prospect and the programme will be continued so long as unemployment remains at a high level. I want to emphasise that point because the special employment measures demonstrate our concern to take action to reduce unemployment. Only higher and sustained economic activity here and in the world economy will solve general unemployment, and that is the aim of the Government's policies; but we cannot leave people unemployed so long as there are sensible ways to offer them employment or training opportunities, often at little additional cost to maintaining them in unemployment. That is why we have given priority, and will continue to give priority, during a time of high unemployment to developing a wide ranging programme of special measures.
I was asked to say something in reply to the noble Lord, Lord Rochester, who was kind enough to give me notice of his interest in voluntary national community service. This proposal has already been made on a number of occasions. It is a very difficult proposal to cost without knowing the volume of volunteers and the sectors in which they might work. However, the Government believe it is a less efficient and probably more costly way of helping young people than the MSC programmes, and those programmes concentrate particularly on that 10 per cent. of young people who do not move into further education, into jobs or into training some six months after leaving school. They provide those young people with a variety of opportunities, some of them in social services but others, successfully, in work experience with employers in all sectors.

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I want to conclude on the general matters raised by saying one word about the implications of the Industrial Strategy. Much of the debate has been of a very general character, with wide-ranging philosophical, historical and economic considerations in mind. But the Government must produce policies to be implemented here and now in the actual situation.
I want to underline the importance of the work which is currently under way in the Industrial Strategy programme, to which the noble Viscount, Lord Watkinson, referred. The sector working parties have been continuing work on quantifying their home and overseas market share objectives and the implications for output and resources. Many sector working parties have refined their objectives for an increased share of world trade and have been asked to look at future manpower requirements. About half have been able to do so, so far. Unfortunately, preliminary conclusions suggest that, even with the achievement of the sector working party market share objectives, it is unlikely that there will be any significant increases in employment in the industrial strategy sectors between now and the end of 1980. For those sector working parties which have quantified the employment implications, there may be some small net increase, but some of the sectors where, I fear, the largest declines might be expected, have not quantified their estimates.
Much work is being done, and I should just conclude on this subject by saying that the current activities include attitude surveys, plant meetings to encourage the formation of productivity action groups, international productivity comparisons, and the establishment of a Clothing Industry Productivity Resources Agency, with financial support from Government. These sound like small details. But the problem is not going to be solved by great sweeps of the hand or philosophical utterances. It will be solved only by hard, detailed work.
This has been a very interesting debate, although I believe that many of the things said in the course of it may have been said before—indeed, have been said before over many decades. The long-term aims of the Government strategy
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remain a return to full employment and sustained economic growth. But of course we see improved productivity as essential to the achievement of these aims. In the short-term it is difficult to fight successfully inflation, low productivity and also unemployment. It is particularly difficult in the adverse conditions which prevail in the whole industrial world at the present time. But we believe that the Government's approach at the present time achieves the best balance that is available and that there is no real alternative. We believe that we are building by our industrial strategy, by our present taxation policies, by our employment and incomes policies, a sound and stable base for improved productivity and for economic growth.
10.38 p.m.
Viscount AMORY: My Lords, I am delighted to thank the noble and learned Lord, Lord McCluskey, for the courteous way in which he wound up our debate. When I spoke earlier I said how much we were all looking forward to the maiden speech of the noble Lord, Lord Roll of Ipsden, and certainly none of us was disappointed. He gave us a most excellent maiden speech. My noble friend Lord Soames and I were deducing that the excellence of the speech was no doubt due to the training he received at the Ministry of Agriculture, Fisheries and Food when we were both there years ago.
I shall make no attempt to sum up this wide-ranging debate. What was remarkable was the degree of agreement as to the seriousness of the general level of our productivity and the fact that an improvement in it is a prerequisite for maintaining our standard of living and increasing a sustainable level of employment. It only remains for me to thank all those, on both sides of the House, who have participated in the debate. When the idea of this debate was raised I assured my Whips that I envisaged a brief, brisk debate of three hours or so. I now know one thing. I shall never again he allowed to introduce a debate in this House! Having said that, I beg leave to withdraw my Motion for Papers.
Motion for Papers, by leave, withdrawn.

DOMINICA: INDEPENDENCE PLANS
10.40 p.m.
Lord VERNON Lord VERNON rose to ask Her Majesty's Government whether they will make a Statement on their plans for granting independence to Dominica. The noble Lord said: My Lords, we move now from the intractable problems of productivity in the United Kingdom to the future of a small West Indian island, with a population of under 100,000.
The subject of Dominica and its independence has been discussed in the last year on various occasions at Question Time in your Lordships' House, having been initiated by the noble Lord, Lord Segal, whom I am glad to see will be speaking later in this short debate. I have no personal interest in Dominica, nor indeed in any other part of the West Indies. I have visited that beautiful island on a single occasion, some years ago, and I cannot even claim to be well acquainted with it. I should like to make one point absolutely clear at the start of my speech; namely, in asking this Question I have no wish whatever to delay the independence of Dominica. If the people of Dominica themselves want independence now, then I personally think that they should have it. My sole concern is to ensure that that is in fact their wish.
It may be helpful if I set out a few facts relating to the present constitutional position, and if I am wrong on any of them, no doubt the noble Lord, Lord Goronwy-Roberts, will correct me. In 1967, following the earlier break-up of the British West Indies Federation, Dominica acquired associated status under the West Indies Act. This means that it is now fully self-governing, except as regards defence and foreign affairs, for which Britain remains responsible.
In 1975 there was a General Election in which the present governing Labour Party acquired 45·54 per cent. of the popular vote and 16 out of 21 seats in the Assembly. The principal Opposition party—the Freedom Party—with 29·95 per cent. of the vote, won only three seats in the Assembly. That was not perhaps a very democratic result in terms of seats, but who are we to criticise that when we have not ourselves a very democratic electoral system in this country? As I understand
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it, the Election was fought mainly on the issue of law and order, although there was a reference in the governing Party's manifesto—indeed in, I think, both Parties' manifestos—to a rather vague objective of securing unity with other countries in the Caribbean area. I should like to say in passing what an awful pity it is that these small islands are seeking independence on their own, instead of doing so in unity with their neighbours.
In 1976 the Prime Minister of Dominica announced that he would seek independence in 1977, and at the same time a draft Constitution was published. Last year a constitutional conference was held in London, and it concluded that the proposed Constitution should be discussed by the people of Dominica, and if broad agreement was reached, the British Government would approve a request to move to independence in 1978.
In the past year a number of Statements have been made by British Ministers suggesting that differences between the Parties regarding an independence Constitution have been narrowed. For example, on 19th January the noble Lord, Lord Goronwy-Roberts, in reply to my noble friend Lady Elles, stated, as reported at column 208 of Hansard:
"If we are satisfied that the desire for independence is widely supported by the people of Dominica, we shall recommend that they proceed to independence. The progress and the process of internal discussion is, I think, encouraging. It is a factual matter; radio discussions, public newspaper articles and public meetings are proceeding and are, I think, gathering momentum. It is apposite to say that, although both Government and Opposition have a number of constitutional points on which they are at variance, they nevertheless agree that Dominica should proceed to independence. I have an impression that the differences between Government and Opposition are narrowing practically day by day."
This view was echoed in another place as late as the 12th May by the Minister of State, Mr. Rowlands, when he also stated that a senior official of the Foreign and Commonwealth Office was proceeding to Dominica to discuss the remaining issues. I hope that we shall shortly hear from the noble Lord further details about this visit and what was achieved by Mr. Posnett, who was, I understand, the official concerned. In the meanwhile, I must tell the noble Lord that what he said to the House on 19th January and what was reiterated by Mr. Rowlands is very difficult to reconcile with the information which I have received from

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Dominica. For example, since I put this Question down on the Order Paper I have received a letter from Miss Eugenia Charles, the leader of the Freedom Party in Dominica, saying that not only have the differences not been narrowed but, if anything, they are wider than they were before.
I turn now to the attitudes of the two main Parties concerned. There is no difference in principle. Both the Government Party and the Opposition Party are in favour of independence as an objective; the only difference is in timing. The Government Party claim that, having won the 1975 Election, albeit on a minority vote, they have a mandate to take the country into independence now. The Opposition, on the other hand, are doubtful whether Dominica is in a sufficiently strong economic position to afford the luxury of full independence at the present time. They maintain that the proposed independence Constitution lacks the necessary safeguards to ensure the continuation of a democratic form of Government, and they consider that a constitutional issue of such importance should be decided by referendum, which would enable the people as a whole to decide whether they want independence now or later.
The Opposition have also made allegations about serious electoral malpractices under the present Government, about the denial of a fair share of radio time, about the growing Cuban and Marxist influence in the island, and about other matters. My Lords, I am not in a position to say to what extent these allegations are true or untrue, but they have been made by responsible people and I would have thought that they required careful examination by Her Majesty's Government before any further step is taken. Moreover, if there have been malpractices, I hope we shall not be told that this is solely the concern of the Government of Dominica. Technically, no doubt, it is their concern, but it is bound to be one of the factors which must be taken into account by the British Government in reaching a decision on the independence issue.
Independence can come to Dominica in one of two ways. First, under Section 10(1) of the 1967 West Indies Act if two-thirds of the people in a national referendum vote in favour of it.
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In that event, the decision would rest wholly outside the control of the British Government. It would, of course, be the simplest and most direct way of finding out what the people themselves want. We have used it ourselves recently over a constitutional issue, and we are about to use it again in relation to the Scotland Bill. Secondly, independence can come under Section 10(2) by Order in Council without Parliament being consulted, as I understand it. But I venture to suggest that no British Government would wish to take the responsibility of advising Her Majesty to make such an order unless they were satisfied that they were reflecting the wishes of the majority of the people of Dominica, and they cannot possibly be so satisfied unless there is first some test of public opinion.
In the minds of all who have considered this matter there is the precedent of Grenada. It is not a very happy precedent. They are independent now. The people were not properly consulted, and I am sure we would not want what happened in Grenada to happen in Dominica. Your Lordships will recollect that some years ago when a new independence Constitution was under discussion for Rhodesia it was thought appropriate to send a special commission under the noble and learned Lord, Lord Pearce, to determine whether the proposed Constitution was acceptable to the majority of the African population. After several weeks and taking very thorough evidence, they came to the conclusion that it was not; and the Constitution fell to the ground.
In the very different circumstances of Dominica, much simpler methods are available. If the Prime Minister of Dominica feels that the two-thirds majority necessary under Section 10(1) of the Act is too onerous, he could still hold a referendum in order to demonstrate to the British Government that independence commands reasonable majority support, albeit not the 66 per cent. required under the Act. He has, further, two other options. He can wait until 1980, when the next General Election is due, and put the issue to the people. Alternatively, if he feels that for economic or other reasons it is undesirable to wait as long as 1980, he can call an immediate General Election and if, after fairly-conducted elections, it was shown that a reasonable

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majority of the people wanted independence, then I feel sure that any British Government would be ready to meet their wishes.
I think that that is all I need to say except perhaps one thing. Now that we are no longer an imperial Power there is a natural tendency to wish to cut our few remaining colonial ties and to leave the emerging nations, some of them absurdly small, to fend for themselves. There are very real anxieties in Dominica that for reasons of expediency we may be ready to shed our responsibilities without taking the views of the islanders properly into account. They would, as it were, be cast into the deep when, for all we know, the majority of them might prefer to retain, at least temporarily, the lifeline to which they have been attached for the past 170 years or so. If that were to happen, it would not only be deplorable in itself, and a blot on our colonial record—which I for one think, looked at generally, will be considered by history to be a fine one; it could also have serious political repercussions within Dominica. If people think that they have been unfairly treated, it leads to extreme bitterness, and bitterness can itself have other more serious consequences.
So I hope that when the noble Lord comes to reply he will be able to allay some of the anxieties which I have mentioned, and will be able to give an assurance to the House and to the people of Dominica that no irrevocable step will be taken as regards independence until the people of Dominica have been afforded an opportunity to express their views. I beg leave to ask the Question standing in my name on the Order Paper.
10.57 p.m.
Lord McNAIR: My Lords, we can all agree that the noble Lord, Lord Vernon, is not very lucky with his timing. I think that he is to be congratulated on sticking to his guns, and indeed all those who have waited for this debate have shown a most commendable patience. Owing to the late hour, we owe it to each other to be brief; but in view of the enormous importance of the subject that we are discussing, we owe it to the people of Dominica to be thorough. I do not think your Lordships will disagree if I
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say that I think the second obligation outweighs the first.
This is—is it not?—a question of timing. The question is not "if" or "whether", but "when?" We know that Her Majesty's Government will, sooner or later, make a Statement. We know that Dominica will sooner rather than later achieve complete independence. If we could be certain that a majority of the people in the island want this independence now, there would be no excuse for any further delay. However, as the noble Lord, Lord Vernon, has already said, the governing Party did not achieve a majority of votes. I had not realised the figure was quite as low as 45·54 per cent. I am grateful to him for that figure. They had 16 out of 21 seats on well under half the votes.
Your Lordships will realise that they must have a very peculiar electoral system to achieve this result, and of course they have: they have the one which we use ourselves. We have brought this embarrassment on ourselves by lending them this same distorting mirror which we are so superstitiously afraid of breaking and throwing away, and which prevents them, as it prevents us, from electing a House of Assembly which accurately reflects what they in reality want and hope for. In view of that, and in view of the very large vote which the Dominica Freedom Party obtained, it is not surprising that the Leader of the Opposition, Miss Eugenia Charles, has asked for either a referendum or a general election. She has asked for a better electoral system as well. She obtained three out of 21 seats, one-seventh. Translated into terms of our own House of Commons, that would be a block of 90 Members. So, numerically, they are anything but insignificant.
What is more, if any of your Lordships have read, as I hope you have, this pamphlet put about by the Freedom Party called Think it Over, I think you will agree that, as informative, educative propaganda for a people relatively inexperienced in self-government, this is work of the very highest quality. Therefore the requests which the Leader of the Opposition makes for delays or improvements in the draft Constitution surely must be heeded very seriously indeed by those responsible for the policy of Her Majesty's Government.

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I am aware of the argument that Dominica is not the last of the Associated States to be granted independence and that it is therefore all the more important that we do not make any avoidable mistakes in this case for fear of creating unfortunate precedents. But there is one respect in which this island is unique. Dominica happens to number among her population the very last of the pre-Columbian population—the Carib Indians. There are about 1,200 living in a reservation on the East coast of the island.
I should like, as they say in a quite different place, to write into the record what the Prime Minister of Dominica had to say about these Carib Indians in his very solemn Newtown Statement. This may be described as a statement of the Government's policy after independence, and it is not so much a practical programme as a catalogue of aspirations and general attitudes. I am sure that if the Prime Minister achieves one-half of what he hopes to do in this declaration he will be a very great man indeed. This is what is said in this declaration about the Carib Indians:
"Comrades, we will promote an organic unity between the Carib Indians and other races in our society on the basis of an egalitarian society, free from any discrimination or privilege.
To this end, the cultural heritage of the Caribs shall be maintained and protected.
All aspects dealing with civil rights, social status, right of possession and ownership of Carib lands shall be ensured. The Caribs shall be treated equally, and all efforts will be made for Caribs and other races in Dominica to work together to build the bridges of Nationhood and to enhance a sense of personal dignity among all our people and to establish true social justice in our land."
You may find that a trifle vague, but I think it would be ungenerous if we did not grant that it is unexceptionable and that the Prime Minister's intentions are humane and entirely honourable. I plead simply for no undue haste in settling this problem. You cannot rush these things. It may well be rather like our own Romany problem in this country—a matter of a generation or two. Educate the children properly and the difficulties of assimilation will be found largely to have disappeared. When a once proud and mighty race is taking its last reluctant steps into oblivion, a generation is surely not too long to be patient.
This, of course, again, is an internal matter. It is the responsibility of the
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Dominican Government. But while we still have something that they want, I think they will listen to us, particularly when we remind them that the whole world, in which they will shortly be taking their own independent place, will be watching them and will be influenced not a little in its opinion of Dominica, by the way in which they look after these last remnants of the original inhabitants of their very beautiful island.
11.5 p.m.
Lord SEGAL: My Lords, I should like to join the noble Lord, Lord McNair, in thanking the noble Lord, Lord Vernon, for raising this debate tonight, and to say how glad I am that my noble friend is to reply on behalf of the Government. His zeal on behalf of human rights is unequalled by any Member of this House, and I am sure that he would be the last to minimise the importance of this debate.
May I say at the outset that I have absolutely no interest to declare. My sole reason for intervening in this debate applies to everyone who has been fortunate enough to visit the island of Dominica. I was privileged to lead a Parliamentary delegation of both Houses to the Caribbean some two years ago, and of all the islands we visited Dominica was by far the most beautiful and, unfortunately, also the most impoverished. Of course, every island enjoying associated status with Britain is fully entitled to opt for independence, and we as a nation are bound to concede that right. But our responsibitily cannot cease after independence has been granted, and control of defence and foreign affairs has been transferred to the local Government.
We cannot be indifferent to the welfare of the inhabitants, and we readily accept our obligations to render them aid, if need be on an even greater scale after independence than before. That is our obligation and we must abide by it. But if, after independence, the mass of the people are subjected to a denial of human liberties, to excessively harsh measures by their own countrymen, to one-Party rule, to the crushing of all opposition and to occupation by Cuban troops, then the plight of the people of Dominica will lie heavily on our conscience and leave a scar that may have painful results.

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That is precisely the danger that faces Dominica today, and we cannot pass by on the other side. The people of Dominica have a right to decide their own future, if need be in a general election, and we must not deny them that right. It must be a fair election, fought on an up-to-date register of voters, carefully scrutinised by impartial observers to avoid the rigged election lists that occurred in the Guyana election, and with all the polling stations organised on neutral ground instead of in some of the houses of the Government supporters, such as occurred in the last Dominican elections, and free of any suggestion of threats, bribes or intimidation.
The voters must have a clear idea of what independence entails—foreign representation, responsibility for their own defence and increased Government expenditure. They need to have faith in their leaders, who must have a clear record of government and who can command the confidence of the poorest and most oppressed sections of the population. After all, these should be the aims of any good Government, especially of a Labour Government such as Dominica at present enjoys. We still have to learn the lessons of the granting of independence to Grenada, the results of the complicated situation that arose in Anguilla, when British troops had to be sent out to cope with an outbreak of violence, as happened also in Guyana, and the repudiation by Antigua, in a general election, of a Government that opted for independence and yet was overthrown, because the majority of the people of Antigua did not trust their leaders.
Today in Dominica, independence is not the issue. Independence we can take for granted. The important issue is this. Are the people of Dominica to confer still greater powers on their rulers than they at present enjoy? Have these rulers justified by their past record over the last two years a further vote of confidence by the people of Dominica? Can the present rulers claim that they were given power as the result of a fair and impartial election; that they have ruled wisely and justly in the interests of the inhabitants of Dominica and not enriched themselves unfairly at the expense of the islanders; that they have tried to stamp out corruption and maintain an impartial judiciary?
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It is not for us in this country to judge. We must leave the decision to the people of Dominica to put to the vote, not for or against the principle of independence, but whether or not to give a renewed mandate with increased powers to its present rulers.
That is why I would urge Her Majesty's Government to allow the people of Dominica an opportunity to decide, by means of a free and fair General Election, who is to lead them through these shoals and eddies that they must negotiate safely after independence is achieved. For we in Britain cannot be absolved from the consequences that may follow on independence. If we are fully alive to the problems—and no one is more so than my noble friend—which have followed in the wake of Cuban troops in Angola and the Horn of Africa (troops thousands of miles away from their home bases), what are likely to be the consequences for poor little Dominica, situated as it is almost on the doorstep of Cuba, certainly a mere stone's throw away in terms of logistics? Who will come to Dominica's defence once our own defence of the island is withdrawn? I would ask my noble friend with the utmost seriousness to answer that question and to devote himself now to the serious consequences that could follow. Will Dominica alone be threatened? What of St. Lucia and St. Vincent and all the other Caribbean islands now in the pipeline for independence? Can we merely stand aside as we have done in Angola, Zaire and Ethiopia and watch them one by one come under Castro's influence? It is in our interests, as well as in the interests of the whole of the free world, to pause before we plunge. We must allow these proud peoples of the Caribbean islands the right to judge their own future, to realise fully what is at stake and to justify for themselves, by the exercise of their own free will, the benefits and the responsibilities which only true independence can confer.
I would appeal to Her Majesty's Government in their benevolence and their wisdom to defer the granting of independence just a little while longer, preferably until 1980, when the people of Dominica will have had the opportunity to exercise their democratic right by means of a general election and of passing judgment, as we are so thankful to be able to do in this country, on their present rulers.
11.13 p.m.
Lord MONSON: My Lords, first of all I should like to join other noble Lords in congratulating the noble Lord, Lord Vernon, on raising this important issue on which he is so knowledgeable and perceptive. I would not have presumed to intervene in this debate were it not for the fact that I think I am one of the relatively few Members of your Lordships' House who have had the privilege of visiting Dominica, that hauntingly beautiful yet sadly impoverished island. I hasten to add that I have no interest whatsoever in the country. The poverty of which I spoke a moment ago is consequent upon the beauty, in that the exceptionally high rainfall which is responsible for the lushness of the landscape at the same time washes away the roads and makes communications extremely difficult; as do the 365 rivers—one for each day of the year—of which the islanders are so proud, and rightly so. Furthermore, the rugged terrain, dramatic though it is, makes cultivation extremely difficult. Indeed, only 22 per cent, of the land area is under cultivation.
This poverty is all the more glaring when Dominica is contrasted not with formerly British West Indian territories or countries but with its immediate neighbours, Guadeloupe to the north and Martinique to the south. This is partly because their topography and micro-climate (if that is the right word) are more favourable from the economic angle, if not from the aesthetic point of view, than those of Dominica, but mainly because these two islands are legally Départements of France and as such are heavily subsidised by the metropolitan Power. The option of integration was never open to the Dominicans, though as the island changed hands between the British and the French no fewer than five times between 1759 and 1805, it is ironical to think that this option might have been available if the island had changed hands just one more time.
But that is all in the past. The important thing is the future. Given Dominica's geographical and, to a lesser extent, historical disadvantages, it is surely up to us, particularly those of us who have developed a fascination and indeed an affection for the land and its people, to do the best we can, given the limitations imposed upon us by Dominica's internal
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self-governing status, to see that the island's future economic and political development is on the most beneficial lines possible.
As various noble Lords have said, the people of the country have a right to independence: provided they know what it entails, provided that individual rights are safeguarded (so far as Britain is able to ensure that), and provided that the majority of the people are demonstrably and unequivocally in favour of independence. But how many Dominicans are aware of the true costs of full independence? How many realise that the cost to Barbados, a country not far to the south, of maintaining a Diplomatic Service works out at 6 million dollars per annum? That equals approximately 24 dollars per head of the population. However, the cost of the Diplomatic Service remains much the same, whatever the population of a given territory. So in Dominica's case it would work out at approximately 76 dollars a head—rather a lot for a small, poorish country, I suggest.
How many realise that upon full independence the Privy Council would no longer be the final court of appeal? How many realise that if individual rights are not safeguarded the technical, professional and managerial classes may well emigrate, as indeed they have done from elsewhere in the Caribbean, to the very great detriment of the countries concerned? In that case who is likely to step in to fill the gap? It could be New York or Miami gambling interests, who are wont to scour the Caribbean in search of soft havens where they can set up a base for their somewhat sordid activities, and who may or may not have Mafia connections. More likely it will be those of a certain Caribbean island which has been in the habit recently of sending its personnel to various parts of the world; indeed to Africa and the Arabian peninsula as well as closer to home—whether invited or uninvited.
Then with regard to the question of safeguards: so far as the draft Constitution is concerned is not the Opposition Party reasonable in demanding that the President of an independent Dominica should not be an appointee of the Prime Minister, and in demanding, for example, that the offices of Attorney General and

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Director of Public Prosecutions be kept separate? Is there not something to be said for proportional representation? I am not myself an enthusiast for proportional representation so far as the United Kingdom is concerned; I do not think it is necessary. But the situation in the Caribbean is somewhat different. The noble Lord, Lord Vernon, and I think the noble Lord, Lord McNair, drew attention to the curious results in Dominica which were produced by a first-past-the-post system. One can think of a larger country in the Caribbean which has recently had an election, where the majority Party got 80 per cent. of the seats, albeit with only just over 50 per cent. of the popular vote. This had nothing to do with gerrymandering; it just so happened that the results were remarkably consistent over the constituencies and the majority Party got a small majority in almost every constituency. None the less, the end result was that the composition of Parliament did not reflect the general will of the electorate.
Finally, as to whether there is an unequivocal demand for full independence, this has not been demonstrated. It was not an issue at the last General Election, and therefore I submit that the present Assembly is not morally competent to take such a decision. I contend that the issue should be decided after the next General Election, which after all must take place some time within the next twenty-one months, or better still, as other noble Lords have suggested, after a referendum.
11.20 p.m.
Lord HATCH of LUSBY: My Lords, I have a special interest in this issue as I was the author of the Labour Party pamphlet, Policy for the Association of Smaller Territories, with the invaluable assistance of the late Mr. Justice Ungoed-Thomas and of the noble Lord, Lord Gordon-Walker. It was from that committee work and the publication of the pamphlet that the West Indies Act, 1967 arose. Neither in the policy document nor in that Act was there ever any question whatever but that the people of an associated territory had an absolute right to demand and receive their independence at their will. The only purpose of modifying
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independence temporarily was to allow the smaller territories not to have to bear the brunt of defence and foreign affairs for a very short time. That right has not been challenged tonight. What has been challenged is the method by which that right should be established, and probably without full knowledge a great deal of what has been heard tonight has arisen out of the political situation and the political propaganda of Dominica itself.
So far as my information goes, the negotiations between the Dominica Government and Her Majesty's Government have been conducted with the utmost propriety; a constitutional conference has been held at which both Parties in Dominica agreed to independence; a draft Constitution has been drawn up and fully discussed throughout Dominica, by individuals and by associations; compromise has been made by the present Dominica Government to the Opposition in matters like the republican constitution, the unicameral arrangement; and a further conference has been held with Her Majesty's Government.
I am sure that noble Lords will not expect the Minister or Her Majesty's Government to give a clear and definitive answer on their timing of independence for Dominica, for it is unfortunate that we are debating this matter just two weeks before the Dominica House of Assembly itself is due to debate it. What I would therefore suggest is that, having aired these various views tonight, we ask Her Majesty's Government if it would not be proper now to leave this matter until it has been fully debated in the Dominica House of Assembly by the elected representatives of the Dominica people, elected on a Manifesto which included the claim of independence.
As the noble Lord, Lord Vernon, has pointed out, there are two methods by which Dominica can attain independence. One is through the passage of a Bill by two-thirds majority in the House, followed by a referendum—that is Section 10(1) of the West Indies Act, 1967; or by Order in Council of Her Majesty's Government—that is subsection (2) of Section 10. I suggest very strongly to Her Majesty's Government and to this House that Section 10(2) is by far the more appropriate and the more constructive in the present situation in Dominica, and for

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the following reason: We have heard a great deal of political propaganda concerning the internal affairs of Dominica auring the debate tonight. However, we are not responsible for the internal affairs of Dominica and we have not been since the Act of 1967.
I say to my noble friend Lord Segal that it is not our responsibility as to whether the Dominican people invite Cubans or any other people to their island. I have spent a great deal of time in the past few years in Jamaica and can tell my noble friend that if the Dominicans receive the assistance from Cuban doctors, Cuban engineers and Cuban dam builders that the Jamaicans have received, they will be very fortunate. What possible military value could Dominica have to the Castro régime in Cuba?
Lord SEGAL: My Lords, I hope that my noble friend will forgive me for interrupting him, but will he explain to the House what possible value Angola and Ethiopia may have to Castro?
Lord HATCH of LUSBY: My Lords, certainly. As regards Angola, it is now established that the Angolan MPLA asked for the assistance of Cubans after interference by the CIA from Washington and after the invasion by South African troops. However, I shall not be led any further in that direction in this debate. It is not for us to use patronising tones and to tell the Dominicans who they should invite to their island. Dominica, like all the other associated territories, is completely independent, with the exception of those reserved sections which at present largely consist of defence and foreign affairs. What happens within Dominica is the responsibility, and has been the responsibility for 11 years, of the Dominicans.
I strongly suggest that Section 10(2) is appropriate in this instance, because if a referendum were to be held in Dominica or if a General Election were to be held on this issue, two things would follow. First, the divisive effect of politics within Dominica itself would be deepened and there might well be an outbreak of violence during either a referendum or a General Election. Secondly—and this should concern this House in particular—a referendum of that character would almost certainly become an anti-British referendum: it would be a
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referendum for or against Britain, which I am certain is the last thing that any noble Lord in this House would wish.
Therefore, I suggest to my noble friend the Minister that, when he and his colleagues come to discuss this matter within the Foreign Office once it is established that the draft Constitution has been approved by the House in Dominica itself, the Order in Council should be used—which I believe will be brought to this House and to another place for further debate—rather than the divisive methods of either a referendum or another election on the issue of independence. The issue of independence has been settled; now it is up to the Dominicans themselves to decide what form that independence should take.
11.30 p.m.
Lord BROCKWAY: My Lords, I do not propose to enter into the fundamental discussion which has taken place. It is enough for me that Associated States have the right to choose independence. It is enough for me to know that both the Government Party and the Opposition Party in Dominica have declared for independence. I do not believe there is any doubt that if a referendum took place on the issue of independence there would be an overwhelming majority in its favour.
What has been behind some of the speeches tonight—and I do not refer to the speech of the noble Lord, Lord Vernon—is the internal policy within Dominica itself. That is a matter for the Dominican people. It is not a matter for our delaying the independence. But in the brief time that I shall speak, I want to raise with Her Majesty's Government one incidental issue. It is the issue of dual nationality. Surely that should be a matter for negotiation between Her Majesty's Government and the Dominican Government. At present dual nationality is denied; that is to say, the 15,000 Dominicans who are in this country would have to choose either to become a citizen of this country or to become a citizen of Dominica.
Many of them have been here for 20 years. They have paid taxation to this country. If they decided to become citizens of Dominica and dual nationality was not allowed, they would lose many of the rights which citizens have in this country. They would lose, for example, the

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right, which one has in the European Community, of travel and taking work abroad. On the other hand, if they decided to become British citizens and not Dominican citizens, they would lose their rights in their homeland; they would be aliens in their own land. I am asking Her Majesty's Government to negotiate with the Government of Dominica so that dual nationality, of both this country and of Dominica, may be allowed.
There are many precedents for that. The United States of America and Canada have allowed it after five years' residence in their territory; many of the Caribbean countries—for example, Trinidad, as well as Guyana—admit this. Although I am all in favour of the Order in Council giving independence to Dominica, I am asking Her Majesty's Government to negotiate with the Dominican Government so that the Dominicans in this country may have that dual membership which is so frequently allowed and which I believe would mean liberty for the 15,000 Dominicans who are in this land.
11.35 p.m.
Baroness ELLES: My Lords, the debate which we have had so far this evening is the kind of debate that can really best be held in your Lordships' House. All those who have spoken have done so with great knowledge, experience and feeling on a matter which is not only of vital importance to Her Majesty's Government and to Her Majesty's Opposition, but more particularly to the 75,000 or 80,000 subjects of Dominica who are looking forward to independence. I should particularly like to thank my noble friend Lord Vernon, who I am sure everybody will agree has presented a case most fairly and given an excellent backcloth to the subject that we are speaking about this evening.
We have to remember that the bold words of independence no longer mean release from the yoke of a colonialist or imperialist Power, but a struggle in a cold, interdependent, economic world where no one, whether it be the United Kingdom or Dominica, can survive economically without the possibility of commercial or trade relations and external financial support. This is now a universal condition that all
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of us have to face, and it will have to be faced by Dominica just as it is faced by this country.
On independence Dominica will hopefully become a member of the Lomé Convention, and will get support from the European Community. I should be happy if the noble Lord the Minister of State could confirm that this opportunity will be available to Dominica. Secondly, it will also have the possibility, if it has the financial resources and support, to become a Member of the United Nations in due course. It will be one more voice added to the more than 150 sovereign States already in that organisation.
To the people of Dominica the political benefits of independence may be quite great, but subject always to the possibility of the citizens being able to retain their freedom of action under a beneficial Constitution, and to receive the kind of economic assistance which will enable them to develop economically and socially in accordance with their own potential, and at the same time retain a measure of freedom and control over their own destiny.
There have been certain remarks made this evening which I would question. There has been a certain accusation that we are to some extent interfering in the internal affairs of Dominica. But the kind of Constitution that Dominica will have is our concern. We are handing over, after all, freedom of government to a country for which we have been responsible for many decades. We have been responsible for its defence and its foreign relations, which are major matters for any country, however big or however small. It is essential that if a country is to survive in this world it must have a Constitution which is not only worthy of its people but will enable it to carry on in a democratic tradition. So I would not say that the concern which has been shown tonight over the type of Constitution that Dominica is to have is interfering in its internal affairs.
There are some questions I should like to put to the Minister of State. If he cannot answer them now, I would await a written reply. But knowing the preparation that the Minister always makes for these debates, I am certain that he will be able to give us an answer

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this evening. The first point is that if an Order in Council is to be brought before both Houses, as I understand it is the intention of the Government to do in the future, it must clearly be shown beyond a shadow of doubt that Dominica wants independence at this present time. I should therefore like to know from the Government by what means they will be able to show to both Houses that this is so.
One question that I had put to the Minister of State earlier in the year has already been referred to by my noble friend Lord Vernon, but I should refer to another which was put down by the noble Lord, Lord Segal, on the 29th November last year. The noble Lord, Lord Goronwy-Roberts, said:
" We have engaged in seeking reports on the state of opinion in that country. When we receive the two reports to which I have referred, Her Majesty's Government will be in a position to decide, among other things, whether we follow one or other of the suggestions already made in this House ".—(Official Report, 29/11/77, col. 1087.)
I should therefore like to know whether those two reports are available or will be made available to Parliament. Presumably they are reports from the Government representative and a civil servant who went there quite recently to find out the feeling of the people of Dominica, and I am sure the House would be grateful for information on the views contained in those reports.
Thirdly, I should like information in regard to the draft Constitution. Several noble Lords have tonight referred to Miss Charles, the Leader of the Opposition, who has obviously taken a keen interest and shown great initiative and energy in trying to get a draft Constitution which at any rate she and her Party believe would be to the benefit of the people of Dominica. There seem to be three sticking points: first, in regard to the election of the President; secondly, in regard to the composition of the electoral committee; and thirdly, a public service commission. I should like to know what prospects there are of arriving at some sort of compromise with the Opposition on those three sticking points, which might well be a major contribution to the settling of a dispute between the Parties and reaching a satisfactory and concerted demand for independence at a comparatively early stage.
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Fourthly, are the Government certain that by a vote in the House of Assembly in Dominica there would be evidence which would show that the majority of the people want independence on the conditions which would be put to the House of Assembly? The noble Lord, Lord McNair, and others have referred not only to the electoral system but to the result of the elections and, from the figures I have, it is clear that the five seats which were won, three by the Freedom Party and two by Independents, together represent the majority of the votes. I understand that the Labour Party had 46 per cent. to 47 per cent., the Freedom Party 30 per cent. and the Independents 17 per cent. That was of the votes cast; that is, 47 per cent. of the five seats and 46 per cent. representing the 16 seats. So by whatever means the votes are taken in the House of Assembly, unless there is a unanimous vote, or the Independents vote with the Labour Party, there is clear evidence that the electorate itself, in so far as it is represented in that House, is not in favour.
Further, if one takes the figures of the lists of all registered voters, the difference is even more striking, because I understand—I may be wrong and I am subject to correction; I am referring to the last General Election, in 1975—that 36 per cent. voted for the Labour Party, 24 per cent. for the Freedom Party and 13 per cent. for the Independents. That makes 37 per cent. as against 36 per cent. So whichever way one takes it—and I am of course juggling with the figures—the voters have shown a preference for the five as opposed to the 16, and it would take a lot of convincing if the votes in the House of Assembly in regard to the Constitution were to go 16 to five.
People in this country concerned with this matter and the people of Dominica would want to be convinced more strongly that independence is wanted now and on the terms which the British Government are offering. Therefore, the only other consideration will be this. If and when Dominica should gain independence, what will be the economic conditions under which she will have to work? I do not know whether the Minister can give us some indication of the kind of economic assistance that will come from this country, and say whether it would not be better to come through the European

821
Development Fund rather than in direct grants from here. I have been given to understand that sums received from the European Development Fund have already been used with great benefit in Dominica. That might possibly be a better way of ensuring some economic support for the country. I should be grateful for some information on that subject.
Defence, a major issue, was raised. I should be grateful if the Minister could touch on that subject and say whether any discussions have been undertaken with the United States or possibly with the French Government—Dominica is, after all, a neighbour of Guadeloupe and Martinique—as to what kind of defence system they imagine will he afforded to Dominica, because it is presumably fairly certain that Dominica will not he able to afford a defence contribution.
I refer to The Times of October last year, when there was a strike among the Civil Service. When the Government were asked about the pay for the Civil Service, and why the pay had not been handed over to the civil servants, the reply was that the Government did not contest the basic claim but simply did not have the money. If we are handing over independence to a country in this economic plight it is surely for us to see that it will be able to meet its obligations to its own citizens in both economic terms and defence terms as well as in political terms. I should like to add my voice to that of my noble friend Lord Vernon in putting the Question to the Minister.
11.48 p.m.
The MINISTER of STATE, FOREIGN and COMMONWEALTH OFFICE (Lord Goronwy-Roberts): My Lords, this has been an interesting and extremely useful debate. I am particularly grateful to the noble Lord, Lord Vernon, for making this discussion possible, and also to my noble friend Lord Hatch of Lusby for warning the House that I should not be in a position to pronounce on Government policy this evening. Nevertheless, the considerable interest in this Question which has arisen in this House and in the other place has already convinced the Government that they should take the somewhat exceptional step of publishing, indeed, on Wednesday next, 5th July, the report
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of the senior official from the Foreign and Commonwealth Office who recently specially visited Dominica in order to ascertain so far as possible what the state of opinion was—is—in that island, and to make recommendations to Her Majesty's Government. I believe that that report. prepared by Mr. Posnett, a distinguished member of the Diplomatic Service and a barrister of considerable experience and power, will shed a great deal of light on some of the matters which noble Lords, and indeed the noble Baroness, have raised this evening. I do not propose to go into them in much detail at this stage.
Section 10(1) of the West Indies Act was designed to support the movement in the Eastern Caribbean towards some form of regional association. However, as we know, progress towards a form of regional association has not been as rapid as once we hoped. In the meantime, States of comparable size, or indeed of smaller size and resources, have achieved independence and have been admitted to the United Nations. The desire to continue to work towards regional association is of course still strong in the Eastern Caribbean, and it will certainly continue to be the policy of the British Government to foster that trend in every way possible.
However, most of the Governments of the Associated States now consider that their progress to independence should not be delayed further, and hold the view—as my noble friend Lord Brockway made clear in an impactive contribution—that it would be unreasonable if the existence of Section 10(1) of the Act were to be allowed to become an obstacle to separate independence. They are supported in this view by the Governments of the Caribbean Community. The British Government accept these views, and indeed believe that separate independence for the Associated States could provide a greater stimulus to regional co-operation than the existing Constitutional Arrangements; that is, continued association with the United Kingdom.
The principal aim of the West Indies Act was to create a new relationship of a voluntary nature which, unlike the colonial relationship, could be terminated by either side acting unilaterally; but there was certainly no intention to prevent the termination of the association by

823
mutual agreement. It is therefore entirely proper, as the noble Lord, Lord Hatch of Lusby, pointed out, that the British Government should use Section 10(2) of the Act to terminate association at the request of an Associated State Government when there is reason to believe that such a step is not opposed by the majority of the population, and where proper Constitutional provision has been agreed with the Government of the State, after full consultation with the official Opposition, and other interested groups.
I turn now to a number of specific points made by noble Lords during the debate. At this late hour I cannot hope to address myself to every one of them, but there are one or two points I should mention. There has been an allegation of incompetence, and even worse, on the part of the Government of Dominica. I think that noble Lords will be able to form a clearer judgment of such allegations when they have read Mr. Posnett's report. However, I should remind the House that domestic political questions in Dominica are not the responsibility of the British Government; nor the responsibility of this House or the other place. Internal self-government is internal self-government, and we must be very careful that we do not, as it were, reach out for some semblance of our past monitoring function in regard to some of these territories. Dominica has enjoyed full internal self-government for a considerable time, and indeed has had delegated to it essential control over its external relations—
Baroness ELLES: My Lords, may I intervene for just a minute? Of course I accept what the noble Lord says about the responsibilities regarding the internal affairs of Dominica being with the Dominicans. However, would not the noble Lord agree that where there is any doubt about, or possible accusation of, any infringement of rights of an individual, which, as I understood it, was being put forward, that is no longer an internal affair, but is of universal interest?
Lord GORONWY-ROBERTS: Yes, my Lords, I entirely agree: if there were such an infringement in any country in the world, including our own, it would have its international implication and
824
connotation. I shall come to the draft Constitution in a moment—a draft which, as the noble Baroness knows, includes a very powerful section about basic freedoms. I will not go into any detail as to the correspondence which has ensued between my honourable friend the Joint Minister of State and the leader of the Dominica Opposition, Miss Charles. I believe Miss Charles's letter, which sets out her case in detail, has been copied fairly widely among Members of Parliament and elsewhere, and it may well be that public currency might be considered for the reply of my honourable friend the Minister to the points she has raised. I will consider that aspect of the matter. I can certainly assure the House that the case of the Opposition on the Constitution has been very carefully and very fully considered. The noble Baroness asked me a number of questions, and I hope to be able to satisfy her on that aspect of the matter, with the others, before I finish my remarks.
My noble friend Lord Segal suggested that, in some way, Cuba poses a threat to Dominica. I can only say that Her Majesty's Government are aware of no evidence to support this claim; and, as has been said in this debate, relations between Dominica and Cuba after independence are, of course, a matter for the Government of Dominica to consider. I have no doubt at all that the long and close friendship between Dominica and the United Kingdom will continue after independence; and so will the more practical forms of encouragement and friendship we have hitherto extended to that country continue after independence. This brings me to a number of points raised by the noble Baroness, in particular the very important point she raised about the economic prospects of Dominica when it proceeds to independence. As she said, it will accede to the Lomé Convention. The position of Dominica at the moment as an associatee, of course, is substantially the same, by way of what will accrue to her, as it will be under the Lomé Convention. Nevertheless, the noble Baroness is quite right: she will accede to the Lomé arrangements, and that will be a reassurance to the new country. I entirely agree that there may well be opportunities of aid flowing from the Community through the European Development Fund: through her membership of the United Nations, if she chooses

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to apply for such membership; through (who knows?) her membership of the Commonwealth—and I have no doubt she will apply for such membership—and possibly from international organisations such as the IMF. The noble Baroness and I know of examples where newly-independent States of this kind have been helped—indeed, are now being helped—in a practical way by the IMF and similar organisations.
I was also asked from the Front Bench opposite whether, if an Order in Council is laid in both Houses, it would clearly be shown that Dominica really wants independence. This brings me squarely to the question, how to assess public opinion in this country, indeed in any country. We have very sparingly used in the United Kingdom the technique of the referendum. We have largely depended upon the evidence of General Elections, and General Elections held on the first-past-the-post system, as they do in Dominica. There have been suggestions about the reform of the Dominican method of election and, indeed, the Government there have proposed that four out of the five nominated Members should accrue to the Opposition—which is rather more than any Opposition could hope to achieve by PR.
Lord McNAIR: The noble Lord says, "four out of five". Does he not mean "four out of nine "?
Lord GORONWY-ROBERTS: I am sorry. It is my imperfect Celtic diction, especially when I address myself to Caribbean affairs. I was making the point that while no country can lecture another on the best way to organise its electoral system, we can learn from each other, undoubtedly. The Dominican Government have proposed that four out of the nine nominated Members should accrue to the Opposition. I think that I have it right. I was making the point that under the single transferable vote, which is the purest form of proportional representation, an Opposition could not get more than four out of nine. In any case, the General Election of 1975—the last available example of the popular act of voting in Dominica—resulted, as we have seen, in a very large majority in the House of Assembly for the Government
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Party, the Labour Party, and, indeed, a very large majority, I would say, of the votes cast—unless you are going to count every one of the 17 per cent. who voted Independent squarely within the court of the largest Opposition Party, which is really rather a risky assumption to make when you are dealing with Independents and, may I, with due deference, say, "Liberals ".
So 46 per cent. or 47 per cent. should really be matched against 29 per cent. or 30 per cent. The probable direction of the other 17 per cent., if they are truly Independents, is, to say the least, problematical. They would have to show a remarkable un-independent degree of unanimity to be counted wholly with the main Opposition Party.
Baroness ELLES: The noble Lord will forgive my interruption. The fact is that the two Members who were voted by the 17 per cent. did vote with the Freedom Party, and make up five votes as against the 16. Obviously, one cannot say how the 17 per cent. would vote on any particular issue as they were Independent. Nevertheless, two representatives voted with the Freedom Party. I am sure the noble Lord will accept that.
Lord GORONWY-ROBERTS: Indeed they did. There were five votes out of 21 cast against the Government. I was addressing myself to the argument, repeatedly made by more than one speaker, that whatever happened in the House of Assembly we should count the votes in the country. I was counting them, at least as credibly as did the noble Baroness, by giving the two Independents their proper degree of independence.
The other point to take note of is that the Election was fought on a manifesto presented by the Government Party which included a clear commitment to the ending of association. We must therefore assume that because the others taking part in the election did not mention it, at least they had no very great objection to it. The manifesto, by making it a prominent part of the programme, obviously looked to an early implementation of independence or the end of association.
So all in all, we must reasonably accept that the people of Dominica have spoken fairly clearly in favour of independence

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and, I would say, as soon as possible. Indeed, both Miss Charles and the Premier have agreed that they are in favour of independence. If the question is one of timing, then I would suggest that we should pay appropriate regard for the views of the Heads of Government of the Caribbean States generally, who have indicated quite clearly that they wish to see the movement to independence proceed as quickly as possible.
The noble Baroness and others raised the question of the draft Constitution. I should like to pay tribute to Miss Charles's creditable efforts to obtain a satisfactory Constitution, and her contribution to the discussion and the arguments. It is unfortunately true that while the differences between the two Parties have gradually narrowed, I see no prospect of their further narrowing. This must be said. I hope very much that further thought and discussion between them will lead to an even greater consensus.
As to citizenship—an extremely important point raised by my noble friend Lord Brockway—there are no differences between Her Majesty's Government and the Dominica Government or between the Dominica Government and the Opposition over the proposed citizenship provisions. I am tempted to quote from the summary of proposals for an independent Constitution for Dominica on this point. I will content myself by referring the noble Lord, and indeed your Lordships generally because of the importance of this point, to paragraphs 27 and 28 of the summary of proposals. My noble friend and the entire House will find that the proper concern so clearly expressed by my noble friend is fully met in those two paragraphs.
The noble Lord, Lord Vernon, in what I would describe, without presumption, as an excellent opening speech, queried whether the Opposition have had or are having a fair share of radio time. Here again, I am afraid that we must insist that an internally self-governing country must be assumed to he regulating its own internal affairs. The allocation of radio time, and the organisation of balanced opportunities for public opinion, is clearly part of that internal functioning. It is worth pointing out that the whole of the House of Assembly debate on the question of the termination of association was
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broadcast live. That is something that we have not done in this country yet. It is possibly a proposal which a great many people might approach with qualified enthusiasm.
I have referred to the questions relating to electoral reform which the noble Lords, Lord Monson and Lord McNair, and others, referred to. I think there was some suggestion of electoral malpractices. Here again, I think one will await the publication of Mr. Posnett's report because when it appears in a day or two it will have something to say on this subject—
Lord VERNON: My Lords, would the noble Lord permit me to interrupt him for a moment? He has mentioned several times the report of Mr. Posnett. Could he tell the House how long Mr. Posnett spent in Dominica, and whether he toured the whole island or remained in the capital of Roseau?
Lord GORONWY-ROBERTS: I think the best person to answer that question is Mr. Posnett himself. I do not think the noble Lord or anyone else will have more than a day or two to wait before he can consult the book rather than the crystal—literally so. The noble Lord, Lord Monson, asked whether on independence the Privy Council will or will not be the final court of appeal. The Judicial Committee will continue to be the final court of appeal. I think it was also the noble Lord who asked whether the President would be an appointee of the Premier. That is not what is proposed. The President will either be appointed by mutual agreement or by secret vote in the House of Assembly.
I end this rather long reply to a debate which covered many more points than I had anticipated, with this assurance. It is our policy, of course, to advance Associated States to full independence as swiftly as possible. They are not in the same position as what we call "independent Territories". They are Associated States who are voluntarily in association with us, and in many cases essentially in a position of quasi-independence already. We wish to advance them to full formal independence as soon as possible. That is their wish and the wish of their neighbours. We shall need

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to take a decision very soon. We are in a position to do so. We have the reports—by the way, the other report is that of the diplomatic representative and normally would not be published, as the noble Baroness knows. The report of the other representative, as I have said, will be published. We are in a position to decide. We may be in a position to decide very quickly indeed: I hope so.
In conclusion, I will say simply this. If Her Majesty's Government were to decide to terminate association— and I believe they will do so—the required procedure would be to present a draft order to both Houses for debate on an Affirmative Resolution. So there is nothing at the moment which is irrevocable. It is perfectly possible to debate this matter fully on the required order being presented to this House, as to the other place.

BRITISH TRANSPORT DOCKS BILL
Reported from the Unopposed Bill Committee with Amendments.
  AIRCRAFT AND SHIPBUILDING: COMPENSATION NEGOTIATIONS
  AIRCRAFT AND SHIPBUILDING: COMPENSATION NEGOTIATIONS
  TELEVISION AND SERVICEMEN IN GERMANY
  TELEVISION AND SERVICEMEN IN GERMANY
  PETROL STORAGE: ANNUAL LICENCE FEE
  PETROL STORAGE: ANNUAL LICENCE FEE
  PARLIAMENTARY PENSIONS: RECIPIENTS
  PARLIAMENTARY PENSIONS: RECIPIENTS