Sitting of 13 June 1978

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
ABINGDON MARKET PLACE BILL [Lords]
MILE END GARDENS (PORTSMOUTH) BILL [Lords]
Read the Third time and passed, with amendments.

GREATER LONDON COUNCIL (GENERAL POWERS) (No. 2) BILL
LONDON TRANSPORT BILL
Read the Third time and passed.

BRITISH RAILWAYS (SELBY) BILL (By Order)
As amended, considered; to be read the Third time.

SHEFFIELD GENERAL CEMETERY BILL (By Order)
Order for consideration, as amended, read.
To be considered upon Tuesday next.

ORAL ANSWERS TO QUESTIONS
  SOCIAL SERVICES

    Dental Services
    Mr. Atkinsonasked the Secretary of State for Social Services what progress he has made towards ensuring that dentists provide treatment under the National Health Service for all patients.
    The Secretary of State for Social Services (Mr. David Ennals): A settlement reached with representatives of the British Dental Association on 17th May ended the dispute over expenses. The way is now open to a return to normal working with dentists offering the full range of treatment under the National Health Service.
    Mr. Atkinson: Is my right hon. Friend aware that much of that agreement is still unacceptable for a large area within the profession? Does he recognise that there are now whole areas of the country where dentists no longer accept National Health Service patients and intend to keep it that way? Is he also aware that many of his hon. Friends, including myself, accuse him and the Chancellor of the Exchequer of deliberately starving the National Health Service dental service of funds so that private patients will continue to contribute a far larger share of the cost of upkeep of the National Health Service? Therefore, will he now institute immediate steps to make good this deficit?
    Mr. Ennals: On the first part of the question, the British Dental Association has reached agreement with me as Secretary of State. I very much hope that all dentists will co-operate. I am very hopeful that, as a result of this decision and the new agreement which provides additional resources for the dentists, the troubles will be ended. However, even during this period there has been a steady increase, month by month, in the number of treatments which have been provided under the National Health Service by dentists. As for the suggestion that the service has been starved, that is not so. There is a steady increase in the number of dentists as well as in resources made available for the service generally.
    Mr. Jessel: Would it not be easier to provide dental treatment for all patients who need it if water were fluoridated, since this would drastically reduce the incidence of dental decay?
    Mr. Ennals: I am in favour of fluoridation and I and my ministerial colleagues are doing our best to find ways to encourage it all over the country. Bit by bit, this is happening, and the majority of area health authorities have taken a decision in favour of fluoridation.
    Mr. Pavitt: Does the agreement which my right hon. Friend has made get rid of the gross injustice to patients that it is not obligatory on the dentist to let them know whether he is treating them privately or on the NHS? Since he has concluded this agreement, will he now implement the working party report which I submitted to his Department two years ago, which would save much of the £223 million that we are now spending on dental services?
    Mr. Ennals: Some of the proposals made by my hon. Friend have been implemented and I am ready to look at some of the others. On the first part of the question, it has been very wrong and irritating for patients when dentists have not explained the situation exactly. We have drawn this to the attention of dentists. They are asked, as are other practitioners, to make the situation clear to patients so that they may know whether they are having treatment under the NHS or are expected to enter into a private agreement.
    Dr. Vaughan: Will the Secretary of State now explain why, for the first time in this country, so many dentists who work in the NHS are going bankrupt?
    Mr. Ennals: I have no statistics of dentists going bankrupt. The hon. Gentleman will know that one of the difficulties which led to the rift between myself and the British Dental Association was the refusal of the Association to cooperate in the work of the dental rates study group and in the production of an up-to-date scale of NHS fees. This was partly because there was an objection to the system whereby they were expected to repay expenses which had been paid to them over and above what was required. That dispute has now ended.
    808
    Dentists will be receiving an increase of 12 per cent. on authorised fees. That is partly an advance for expenses, and it is being made available during the course of this year. This will greatly improve the position of dentists.

    Birth Rates
    Mr. Powellasked the Secretary of State for Social Services what estimate he has made of the proportion which births to mothers born in the New Commonwealth and Pakistan bore to total births during the last 10 years in Birmingham, Bradford, Huddersfield, Leicester, Wolverhampton and the boroughs comprised in the Inner London education area.
    Mr. Ennals: Information on births by birthplace of mother, which first became available in 1969, is published annually by the Registrar-General. As the answer involves a number of figures, I will, with permission, circulate a table in the Official Report.
    Mr. Powell: Do not these proportions, already covering nearly 10 years, give a very good indication, at any rate as a minimum, of the eventual proportion of the total population in these areas which will be of New Commonwealth ethnic origin?
    Mr. Ennals: What they show is something very different from what I think the right hon. Gentleman has been suggesting. He picked his own years and his own areas. The figures show an average figure for New Commonwealth and Pakistan births of 22 per cent., which is far less than the figure of 33 per cent. to which the right hon. Gentleman has frequently referred. He should not assume that fertility rates in these ethnic communities will continue at a high level, nor that there will not be a movement of minority groups from one city to another, as is already happening. I point out to him that in many of the areas which he specified the proportion of births to New Commonwealth and Pakistan mothers went down during the period concerned. That includes the constituency that the right hon. Gentleman originally represented.
    Mr. Flannery: Will my right hon. Friend accept from me that the obsession which the right hon. Member for Down, South (Mr. Powell) has about the

    809
    births of coloured people is not shared by human beings in general throughout the entire universe, and that women will go on having babies as long as there are men with them? Is it not about time that we thought about improving the lot of all human beings instead of being obsessed with this particular aspect, as the right hon. Gentleman is?
    Mr. Ennals: I agree with much that my hon. Friend said. It has, I believe,

    BIRTHS TO MOTHERS BORN IN THE NEW COMMONWEALTH AND PAKISTAN AS A PERCENTAGE OF ALL BIRTHS FOR SELECTED AREAS*. 1969 TO 1976

    Area of usual residence of mother

    1969†

    1970

    1971

    1972

    1973

    1974

    1975

    1976

    Birmingham

    19

    20

    20

    20

    22

    22

    23

    24

    Bradford

    17

    17

    17

    18

    18

    19

    19

    21

    Kirklees

    15

    15

    15

    15

    14

    15

    17

    18

    Leicester

    18

    19

    20

    23

    25

    26

    28

    30

    Wolverhampton

    26

    25

    24

    25

    25

    24

    27

    25

    Inner London Education Authority: Total

    22

    22

    22

    22

    22

    22

    23

    24

    Camden

    16

    17

    15

    14

    16

    15

    15

    17

    Greenwich

    9

    9

    9

    9

    10

    11

    12

    12

    Hackney

    32

    32

    30

    34

    32

    33

    34

    35

    Hammersmith

    22

    23

    21

    21

    21

    21

    20

    21

    Islington

    28

    28

    29

    26

    26

    25

    26

    25

    Kensinston and Chelsea

    14

    13

    12

    10

    12

    12

    12

    12

    Lambeth

    32

    31

    30

    30

    29

    30

    29

    30

    Lewisham

    20

    19

    20

    19

    18

    20

    20

    19

    Southwark

    18

    18

    19

    20

    20

    20

    21

    21

    Tower Hamlets

    17

    17

    18

    21

    25

    27

    27

    31

    Wandsworth

    27

    27

    27

    28

    26

    26

    29

    29

    City of Westminster and City of London

    16

    16

    15

    15

    15

    16

    15

    18

    Total of above areas

    21

    21

    20

    21

    21

    22

    23

    23

    * As constituted at 1st April 1974.

    † April 1969 to March 1970.

    Hospital Waiting Lists
    Mr. Crouchasked the Secretary of State for Social Services what is the average waiting period for a National Health Service patient requiring orthopaedic treatment.
    Mr. Boscawenasked the Secretary of State for Social Services what is the average waiting period for a National Health Service patient requiring general surgery.
    Mr. Ennals: I regret that the information is not available. Obtaining such statistics would involve considerable extra manpower. With each specialty, patients with very different conditions and of differing degrees of urgency would be averaged together. The results would not be sufficiently meaningful to justify the cost.
    been an obsession of the right hon. Gentleman now for 10 or 12 years. I think that this obsession has done great damage to race relations in this country and to community relations. I believe that my hon. Friend is right and that the majority of people do not look at the colour of other people; they take them as citizens.
    Following is the table:
    I am much concerned with this problem, and my Department and the health authorities are energetically seeking to bring about an improvement.
    Mr. Crouch: Does the Secretary of State agree that the problem is not so much a shortage of surgeons as a shortage of facilities—beds, nurses, theatre time and physiotherapy—and that it is this which is causing these long waiting lists? Will he consider the possibility of using the facilities which are available in the private sector, for a fee, in order to overcome this present difficulty?
    Mr. Ennals: That is no answer. The reasons for the problem vary in different parts of the country. Sometimes there are staffing problems. There is also the fact that there is a constant increase in the demand by patients for treatment. There are more accidents. There is also a wider range of surgical techniques. There are

    811
    more elderly people requiring additional support. There are more cases of cancer, and so on.
    If I had produced the statistic that the hon. Gentleman wanted, it would have shown a tremendous variation. There are consultants in some parts of the country with quite short lists. Others, elsewhere, have very long lists. It is essential that the necessary information should be readily available to general practitioners, and that consultants should co-operate together. We should try to improve the management of waiting lists. It is not just a question of money and resources, important though that is.
    Mr. Boscawen: Had the Secretary of State produced the statistics, there is no doubt that they would have shown a very unsatisfactory and deteriorating situation in many specialties. Bearing in mind that figures often conceal individuals in pain and misery for a very long period of time, what possible ground has the Secretary of State for telling the Royal College of Nursing that pessimism about the future could not be justified?
    Mr. Ennals: What I said to the Royal College of Nursing was that we have to get the problems of the National Health Service into perspective. I spelt out, as I have done several times to the House, some of the major pressures which bear upon the National Health Service. I made it perfectly clear that neither this Government, nor any other, would be able to provide adequate facilities to meet all the needs, because the demands are never ending. I said that we need to get into proportion the problems faced by those who work in the National Health Service, and at the same time note its great successes.
    We have roughly the same sort of percentage of patients-10 per cent.—on waiting lists, and the number of inpatients treated in the National Health Service is steadily increasing year by year.
    Mr. Speaker: I appeal to the House for shorter questions and shorter answers.
    Mr. Ovenden: Will my right hon. Friend accept that the delay in obtaining orthopaedic appointments is one of the biggest single causes of unnecessary suffering, among young people particularly? Why has my right hon. Friend's
    812
    Department placed a bar on the appointment of further registrars in orthopaedics?
    Mr. Ennals: Where there is a shortage of consultants in particular specialties, we have to do some sort of rationing to ensure that they are available in all parts of the country, and therefore to approve a post, if it would automatically then mean that another area would be deprived, would be unfair to that area.
    Mr. Beith: Is the Secretary of State aware that nearly 1,000 people are awaiting orthopaedic surgery at the Newcastle hospitals, and that they include many who could be back in productive work if they could get hip operations?
    Will the Secretary of State indicate whether he thinks that the opening of the Freeman Road hospital will make a difference, or can he think of further measures which could be taken?
    Mr. Ennals: I am sure that it will make a difference. That is why, when the Chancellor of the Exchequer announced that additional funds were to be made available, we gave a high priority to ensuring that new hospitals would be fully commissioned as soon as possible, and we put additional money into the acute services for equipment and urgent maintenance, in addition to the special £2 million which was entirely linked with easing some of the problems of waiting lists.
    Mr. Clemitson: Is it not true, contrary to what the hon. Member for Canterbury (Mr. Crouch) said, that National Health Service facilities are sometimes used for the treatment of private patients because of the higher standards, for example, of asepsis in the National Health Service theatres?
    Mr. Ennals: There is truth in what my hon. Friend says.
    Mr. Patrick Jenkin: Returning to the right hon. Gentleman's speech at Harrogate, since he has now been forced to concede that he ought never to have made that speech at all—and has gone so far as to say that in future he ought not to make any speeches at all to the nurses—will he confirm that he is not proposing altogether to cut out meetings of that sort? Such meetings give him the opportunity of a glance at reality, and at what it is like to work at the coalface in the

    813
    National Health Service today, in contrast to his own blatant complacency, which aroused such fury on the occasion of that speech.
    Mr. Ennals: The right hon. Gentleman has totally misrepresented what I said. I said that the arrangement which had been reached, long weeks in advance of the conference, whereby those concerned wished me to send a script of what I was to say, does not lead to the best sort of exchange and the best sort of debate. I have made it clear that I am very anxious to see them and to have a talk around the table about some of their problems, but that I would much rather have a conference without any prepared speeches, at which we could deal directly with the issues which most worry the nurses.
    The right hon. Gentleman knows that I spend a great deal of my time in travelling round the country, visiting hospitals, meeting doctors and nurses, and facing their problems.

    Wyatt v. Hillingdon London Borough Council
    Mr. Carter-Jonesasked the Secretary of State for Social Services what action he intends to take in the light of the ruling of the Court of Appeal on 9th May in the case Wyatt v. Hillingdon London Borough Council; and if he will make a statement.
    The Under-Secretary of State for Health and Social Security (Mr. Alfred Morris): Mrs. Wyatt has now been invited by my Department to specify her complaints against the London Borough of Hillingdon. When these have been received, and we have comments from the local authority, I will consider what further action it may be necessary to take.
    Mr. Carter-Jones: Is my hon. Friend aware that the court of appeal decision will cause great anxiety to hon. Members on both sides of the House and to the disabled, including disabled children and their parents? Is he further aware that the geographical gamble with regard to the care of the disabled will widen? Will he please spell out the default powers of the Government for bringing action against defaulting local authorities.
    Mr. Morris: I appreciate my hon. Friend's concern. He will know that I
    814
    am anxious to do all that I possibly can to improve services for disabled people. Briefly, our default powers provide that a local authority may be declared in default by my right hon. Friend who may then direct the authority to remedy the default. If the authority fails to comply with that direction, my right hon. Friend may transfer the relevant functions of the authority to himself and recover expenses from the authority. I know that he will not hesitate to use his default powers should that be necessary.
    Mr. Hannam: Does not the Minister accept that he, previous Secretaries of State and the parliamentary Ombudsman have all indicated, and made statements to the effect, that the 1970 Act was legally enforceable? Does not this court ruling now mean that he will have to bring forward new legislation to enable the courts to deal with, and enforce, the law?
    Mr. Morris: The ruling of the court of appeal, as I understand it, does not mean that the Act is not legally enforceable. The question is "enforceable by whom?" Most disabled people want an effective remedy for their problems. How that is obtained is a secondary matter. I can assure the hon. Gentleman that I shall do everything I possibly can to resolve present difficulties at the earliest possible date.

    Mobility Allowance
    Mr. Rifkindasked the Secretary of State for Social Services what estimate he has made of the cost of extending entitlement to mobility allowance to those whose immobility is as a result of medical factors other than physical disability.
    Mr. Alfred Morris: If we were to extend the scope of mobility allowance to cover people who can walk but who have other mobility problems, we could not limit the extension to particular disabilities or diagnostic groups. While I cannot give any precise estimate, the cost of such an extension would be very considerable indeed.
    Mr. Rifkind: Does the Minister accept that many thousands of people suffer from a severe lack of mobility caused by mental illness or mental handicap rather than physical inability to walk? Does he not accept that under the regulations there is

    815
    an unfair and arbitrary distinction and that it would be much more appropriate if a mobility allowance were available to anyone who could show that his lack of mobility was due to medical factors?
    Mr. Morris: I am aware of this problem. I shall consider the claims of the people referred to by the hon. Gentleman together with all other claims. I must emphasise that we should not be placed in a position of being unable to put right anything which has gone wrong. I would ask Opposition parties not constantly to be campaigning for a reduction in public expenditure while simultaneously asking us to increase all the parts of that expenditure.
    Mrs. Castle: Does not my hon. Friend agree that mobility allowance should be payable in all cases where mental condition has resulted in a physical inability to walk? When will he introduce his new regulations, which he promised at the time I raised my constituency case of Mr. Trent Brown, in order to establish this principle quite clearly?
    Mr. Morris: We shall shortly be making regulations to put it beyond doubt that a person unable, or virtually unable, to walk for at least 12 months because of physical disablement is eligible for mobility allowance regardless of the nature of his incapacity. I am most grateful to my right hon. Friend for the important part which she has played in this matter.
    Mr. Haselhurst: Does not the term "mobility allowance" continue to be a misnomer when, in fact, there are so many people with physical disadvantages who are not entitled to benefit because of the very tightly drawn terms on which the allowance is presently available'?
    Mr. Morris: It is not a misnomer. The allowance is intended to help people who cannot walk or who virtually cannot walk. It is in the process of helping 100,000 new beneficiaries. We are in the process of increasing five-fold our expenditure on outdoor mobility for the disabled. There are many more claims, and we shall do whatever we can to make further progress.
    Mr. Ioan Evans: Will my hon. Friend state how many now benefit from the mobility allowance? What is the total cost of this scheme? Does he realise that the
    816
    scheme which has been introduced by this Government is deeply appreciated by those disabled people who benefit from it?
    Mr. Morris: At the latest date for which figures are available—5th June 1978–71,142 people were in receipt of mobility allowance. I expect that by the end of 1979 our total expenditure on this new benefit will be £65 million a year. I am most grateful to my hon. Friend for the comment that he made about the importance of this new benefit.

    Mental Health Act (White Paper)
    Mr. Ronald Atkinsasked the Secretary of State for Social Services when he expects the White Paper on the Mental Health Act to be published.
    Sir Bernard Braineasked the Secretary of State for Social Services when he expects the White Paper on the Mental Health Act to be published.
    Mr. Moonmanasked the Secretary of State for Social Services when he expects the White Paper on the Mental Health Act to be published.
    Mr. Newensasked the Secretary of State for Social Services when he expects the White Paper on the Mental Health Act to be published.
    Mr. Ennals: Preparation of the White Paper is at an advanced stage. While I cannot today give a precise date for publication, I hope that it will be published before the Summer recess.
    Mr. Atkins: I am grateful to my right hon. Friend for that answer. Does this mean that it is still the Government's policy to raise mental health patients from their status of Cinderella to a higher priority? Will he soon introduce a policy on medium security units?
    Mr. Ennals: The status of mental health cases has already been determined without any amendments to the Mental Health Act. Within our present priorities we have been channelling an increasing proportion of available resources towards helping the mentally ill and the mentally handicapped. This is part of Government policy. In the answer to a number of other questions we can see the

    817
    result of this at local authority level. This is being done without any need to amend the Act.
    Sir B. Braine: Will the Secretary of State explain why the White Paper has taken so long to produce? Surely he is aware of the deep concern which has been felt for some years about the lack of adequate provision for the mentally ill, particularly mentally handicapped children? Will the White Paper, when it is produced, indicate when we shall have positive proposals for dealing with the disgraceful situation under which magistrates are recommending for treatment mentally ill young people brought before them, yet there are no facilities for such treatment to be given?
    Mr. Ennals: The main problems that are dealt with in the White Paper are concerned with the law. The White Paper is not so much concerned with the actual provision of services, which continues anyway, although I am not saying the White Paper will not also deal with that. The main reason why this has taken a long time is that this is very complicated legislation. The consultative document was sent out in August 1976. There have been 300 representations, most of them from organisations, although some from individuals. They deal with very complicated matters. That is why it has taken a good deal of time to bring the White Paper to fruition.
    Mr. Moonman: Will my right hon. Friend indicate whether the White Paper, which has been a long time coming, will give some regard—despite its complexity—to problems such as the personalised clothing systems in psychiatric hospitals and whether it will take into account the fact that on the latest data about one family in three in this country will require some help for their mental problems in the course of their lives?
    Mr. Ennals: The White Paper deals with the rights of patients. That includes questions of property, correspondence and so on. The White Paper does not deal with the resources to be made available for mental health, be it mental handicap or mental illness, because it deals with the 1959 Act. Resources raise a quite different issue.
    Mr. Patrick Jenkin: It is nine months since the Secretary of State outlined his
    818
    thinking on this subject to the Mental Health Foundation at Oxford. While I entirely accept that these are very complex matters, will he also accept that there needs to be a very full, public and open discussion in the newspapers and elsewhere of what are extremely difficult matters? Will he now bring forward this White Paper so that this discussion can take place publicly at the earliest opportunity?
    Mr. Ennals: I absolutely agree. There is no doubt that we need to have a very wide debate in this House and among the organisations concerned. That is why, if we are to have a responsible debate, we must have a responsible White Paper which deals very carefully with the difficult issues involved. That was why I decided that we should proceed first on the basis of a consultative document, which has led to very wide consultation, and then with a set of proposals from the Government, again with adequate time, so that they can be explored.
    Mr. Madden: Is my right hon. Friend concerned about the arbitrary procedures of the Mental Health Act 1959 under which people can be committed? Will his White Paper make any recommendations for amending these procedures?
    Mr. Ennals: These are central issues which are to be covered in the White Paper.
    Mr. Farr: Can the right hon. Gentleman say whether the White Paper will deal with the position in which people who are perhaps marginally of unsound mind, and who might a few years ago have been kept in detention but who have now been released, as a result of a more enlightened attitude, to live in communities, which may be small or large, to live as far as possible a normal life, can sometimes, as the Minister knows, cause great havoc to those who live in what otherwise is a peaceable community?
    Mr. Ennals: It certainly does not deal with those who are no longer the subject of legislation, namely, people who may have had a mental illness and who have now settled back in the community. I am sure it would be quite wrong for legislation to deal with that. However, it deals with the definition of mental disorder, which undoubtedly needs to be

    819
    brought up to date following the 1959 Act.

    Doctors' Ancillary Staff (National Insurance)
    Mr. Whiteheadasked the Secretary of State for Social Services how many representations he has received about the advancement from 31st to 6th March 1978 of the deadline for application to the new scheme for direct reimbursement of employers' national insurance contributions for doctors ancillary staff; how many such staff have been in consequence refused access to the scheme; and if he will make a statement.
    The Minister of State, Department of Health and Social Security (Mr. Roland Moyle): The arrangements for general practitioners to be directly reimbursed the employer's national insurance contributions that they pay for their ancillary staff came into effect as intended on 1st April last. It was the date for occupational pensions schemes that was brought forward. I have received only a few letters about the change from individual doctors, though representations on behalf of the general practitioners as a whole have been made by the profession's representatives. Following consultations with the profession, detailed guidance on the acceptability of claims should shortly reach family practitioner committees.
    Mr. Whitehead: Is my right hon. Friend aware that I have doctors in my constituency who were told about this pension scheme on the very day that they were also told that the closure date had been brought forward? Cannot he see that that looks like sharp practice to ancillary staff in the National Health Service? Can he tell the House whether the Department calculated the additional amount that would be needed to include everyone who applied by the original closing date of 31st March?
    Mr. Moyle: I reject allegations of sharp practice, since all that was done was done by joint agreement between the Department and the profession after discussions on the principle. No calculations have been made about any increased costs which would arise if all the claims were met.

    Elizabeth Garrett Anderson Hospital
    Dr. Vaughanasked the Secretary of State for Social Services if he will make
    820
    a further statement about the Elizabeth Garrett Anderson Hospital.
    Mr. Geoffrey Finsbergasked the Secretary of State for Social Services whether he will make a further statement on the closure of the Elizabeth Garrett Anderson Hospital.
    Mr. Ennals: Having considered all the available evidence I announced on 16th May that the Elizabeth Garrett Anderson Hospital, on Euston Road, should close and I asked staff urgently to consider proposals to move to alternative accommodation at the Whittington Hospital. The staff at the EGA have now confirmed that they are prepared to consider any offer of alternative accommodation, but without commitment. I have therefore invited the health authorities, representatives of the staff of the EGA and other interested parties to come together under the chairmanship of a senior official of my Department to consider detailed proposals for alternative accommodation In these circumstances I have agreed to postpone the closure of the Euston Road hospital.
    Dr. Vaughan: Will the right hon. Gentleman explain why he keeps dithering over the future of this hospital? Does he not realise the immense amount of damage it does when he cannot make up his mind what should happen? Will he now give a clear promise that the hospital will be kept open?
    Mr. Ennals: There is no question of dithering. My right hon. Friend the Member for Blackburn (Mrs. Castle) entered into a commitment rather more than two years ago in which she said that the hospital on the Euston Road site would close and that it was her view that we should seek an alternative where that facility could be provided within a district general hospital. There has been a great deal of consultation about this. It was my conclusion, after discussion with the staff of the EGA, that since they were now prepared to consider an alternative I should not be tough and insist that the closure had to be on a specific day. Certainly if I had stuck to that when negotiations about an alternative were being considered, I would have been accused in this House of being obdurate.
    Mrs. Jeger: May I say, first, how much my right hon. Friend's decision in

    821
    favour of postponement has been welcomed by the staff and patients of the Elizabeth Garrett Anderson Hospital? However, can my right hon. Friend say what sort of time scale he has in mind? How long will all these consultations take? Pending the consultations, cannot he agree to do the urgent repairs which are necessary—for instance, to get the lifts working again, because these broken lifts are putting half the hospital out of commission?
    Mr. Ennals: I have made it clear that I hope that the discussions about an alternative will not take long. I have also made it clear that the hospital on the Euston Road site will close. In view of that, it would be quite unjustified to authorise substantial expenditure, or for the area health authority to do so, for the replacement or substitution of the lifts. But certainly essential repair work to enable the hospital to continue during such period as remains to it is the responsibility of the area health authority.

    Retirement Age
    Mr. McCrindleasked the Secretary of State for Social Services what representations he has received from the Equal Opportunities Commission and the National Association of Pension Funds on the subject of the retiring age for men and women; and if he will make a statement.
    The Minister for Social Security (Mr. Stanley Orme): My right hon. Friend and I have received copies of the National Association of Pension Funds' publication "Towards Equality in Retirement Ages" and of the Equal Opportunities Commission's consultative document "Equalising the Pension Age".
    We shall shortly be publishing a discussion document on the elderly which takes account of the views expressed in these publications. We look forward with interest to the response to our document.
    Mr. McCrindle: Are not all shades of opinion, including that of the TUC, now reflecting the need to move towards flexible retirement, with the ultimate objective of a common retirement date for both men and women? In these circumstances, is the Minister satisfied that the document to which he refers is all that is needed? Should he not now be under-
    822
    taking a detailed financial assessment of the true cost of moving towards a common retirement date? Most of the statistics produced by the Government so far appear to some of us to have been somewhat bogus.
    Mr. Orme: The figures that we have produced are not bogus. A great deal of information has been given of the cost of moving towards equalisation. Flexibility will be a central issue in the document. We deal with this in great detail, as well as equalisation. But we feel that there is a need for a national debate on this issue.
    Mr. George Rodgers: Does my right hon. Friend agree that it is very difficult to reconcile the principle behind the current legislation on equal opportunities and sex equality with the startling difference in the retirement ages for men and women? Does he agree, further, that this applies also to widows and widowers who when in employment often have equal wages and equal responsibilities, bearing in mind that the widower does not receive a pension? Will my right hon. Friend take these factors into consideration?
    Mr. Orme: Yes, and they will be discussed in the document. I accept that the present differential is illogical, but, as I have explained already, equalisation creates many problems and difficulties, and these will have to be discussed fully.
    Mr. Paul Dean: Does the right hon. Gentleman agree that what really matters is not a blanket reduction in age but flexibility, so that each individual can retire at the age which suits him or her best and which suits his or her job? Does he recognise that we shall make little progress with flexibility until he persuades his Treasury colleagues to reduce the penal rates of tax on personal savings?
    Mr. Orme: I accept fully the first part of what the hon. Gentleman says, but I cannot accept the second part.

    Emergency Services (Bromsgrove and Redditch)
    Mr. Hal Millerasked the Secretary of State for Social Services in the light of the continuing refusal of general practitioners in Redditch to Operate a 24-hour casualty service and in view of the

    823
    lack of facilities at Bromsgrove General Hospital, if he will make a statement on the future of accident and emergency services in that area.
    Mr. Moyle: The area health authority will be reviewing these casualty services in the light of the survey it is making of existing facilities and the use made of them. A major accident and emergency unit will be included in the plans for the new district general hospital at Red-ditch.
    Mr. Miller: This survey has now been going on for more than a year. Cannot the Minister give some indication when a casualty service will be resumed in this very important manufacturing area? How does he view other areas where general practitioners are responsible for the provision of these services?
    Mr. Moyle: On that last point, if the hon. Member will table a Question about it and give me notice, I shall answer it. As for the first part of his supplementary question, the survey will be laid before the area health authority on 16th June.

    Kidney Machines
    Mr. Shepherdasked the Secretary of State for Social Services whether he will make a further statement about the withdrawal of the attendance allowance from patients using kidney machines.
    Mr. Montgomeryasked the Secretary of State for Social Services whether he will make a further statement about the withdrawal of the attendance allowance from patients using kidney machines.
    Mr. Alfred Morris: An application for leave to appeal has now been made to the National Insurance Commissioner and I am awaiting the outcome.
    Mr. Shepherd: Does the Minister agree that the loss of attendance allowance leads to a generally less effective use of dialysis units? Would it not be better to cut across the nonsensical situation whereby everything is stored pending the results of the appeal to the National Insurance Commissioner, and go for both shorter dialysis periods and the attendance allowance?
    Mr. Morris: I cannot add to my original reply, except to say that whatever
    824
    the National Insurance Commissioner's decision may be, we shall need to consider the implications most carefully. I readily undertake to do this. It would be quite wrong for me to reach any conclusion now, in anticipation of the Commissioner's decision. It is not an easy matter, since dialysis patients are only one of the groups to whom the conditions for attendance allowance must be applied.
    Mr. Montgomery: Does the Minister admit that it is unacceptable if dialysis patients lose the attendance allowance without any improvement in their condition? What is he doing to try to speed up the decision of the National Insurance Commissioner?
    Mr. Morris: I am sure that the National Insurance Commissioner is well aware of the interest in the case which has now been referred to him, and that there will be no undue delay in reaching a decision. However, as I have said, I cannot at this time anticipate the decision, and it would be quite wrong of me to start speculating about what should be done in future on any decision or on whether further action might be necessary.
    Mr. Whitehead: I understand that the oral hearing before the Commissioner, involving my constituent, is to take place in a few weeks' time. Will the Minister give an undertaking that the representations made by the Department at that hearing will be of benevolent neutrality?
    Mr. Morris: I am aware of my hon. Friend's considerable interest in this matter, as it is his constituent who has appealed. However, I cannot speak today on the matter of evidence. As to speeding up proceedings, I must emphasise the independence of the adjudicating authorities, including the National Insurance Commissioner.
    Mr. Patrick Jenkin: Since we understand that this decision is unlikely to be announced until the autumn, could the Minister not persuade the Government to accept the Bill brought forward by my hon. Friend the Member for Ealing, Acton (Sir G. Young), which would deal with this expeditiously and make the payment of the attendance allowance to these people?
    Mr. Morris: It would be wrong to attempt to change the law before we are

    825
    told by the National Insurance Commissioner what the law, in his view, means. I have no knowledge that there is likely to be a delay until November. My right hon. Friend has said that he expects the case to be heard in a few weeks' time.

    Emergency Services (North-West London)
    Mr. Dykesasked the Secretary of State for Social Services if he is satisfied with the scope and provision of emergency medical services and casualty departments in North West London.
    Mr. Moyle: The number of general practitioners in North-West London is generally adequate. Many of them rely for out-of-hours emergency cover on deputising services, which are now subject to the code of practice issued by my Department in April. Responsibility for the provision of accident and emergency departments rests with the health authorities concerned, subject to broad guidelines issued by my Department, and I have no reason to believe that the service for this in North-West London is inadequate. If the hon. Member has a particular case in mind I will investigate it if he will write to me.
    Mr. Dykes: I thank the Minister for his reply. I shall send him details of some cases. In view of the continuing staff shortage on the casualty side in the whole area, is the Minister satisfied that there will be no further partial or complete closures of casualty departments for the rest of this year?
    Mr. Moyle: Partial or complete closures of casualty services take place from time to time throughout the Health Service. When a hospital's beds become full, casualties are directed to another hospital. This is part of the normal process, subject to arrangements made between hospitals for the transfer of cases. Therefore, I cannot give the undertaking that the hon. Member seeks.
    Mr. Christopher Price: Is my right hon. Friend aware that there are severe problems throughout London in this respect? Did he see the recent television programme about King's College Hospital and the problems there? If so, what does he intend to do about the problems in his and my area?
    Mr. Moyle: There are, of course, occasional shortages of theatre staff, particularly theatre nurses. I did see the television programme and I am due to visit King's College Hospital in the not-too-distant future, so I shall look at the problem.
    Mr. Pavitt: Will my right hon. Friend look again at the North-West London area's casualty departments—especially those in Willesden? Is he aware that there has been a rationalisation, which has gone much too far? Will he check what has been done in that area?
    Mr. Moyle: I take note of my hon. Friend's remarks on that matter. I know that he has a very deep concern for hospital services in his area, and I shall certainly check what has been done.

    Pensions (Over-80s)
    Mr. Tim Smithasked the Secretady of State for Social Services by how much the 25p addition to the retirement pension payable to pensioners aged 80 years and over would have to be increased to restore it to its real value when introduced.
    Mr. Orme: To restore the value which the national insurance age addition had when it was introduced in 1971, on the basis of the movement of the general index of retail prices, it would be necestary to increase it from 25p to 60p.
    Mr. Smith: Was this not a very valuable and widely welcomed supplement when it was introduced? Why have the Government effectively devalued it in this way?
    Mr. Orme: This is one of many benefits that must be considered in the light of public expenditure costs. This Government have done a great deal for pensioners in this country. We do not need to apologise about it.

    PRIME MINISTER (ENGAGEMENTS)
    Mr. Temple-Morrisasked the Prime Minister if he will list his official engagements for 13th June.
    The Prime Minister (Mr. James Callaghan): Earlier today I greeted President Ceausescu of Romania on his

    827
    arrival for a State visit to this country. In addition to my duties in this House, I shall be holding meetings with Ministerial colleagues and others. This evening I shall be the guest of Her Majesty The Queen at the State dinner in honour of President Ceausescu.
    Mr. Temple-Morris: No doubt the Prime Minister has had time today to consider the effects of his policies of higher spending, more borrowing and higher interest rates. When this is coupled with stagnant production and a questionable wages policy, how can it be a fact, as pronounced recently by one of his Ministers—this is a vitally important point—that single-figure wage inflation will continue for the indefinite future? Surely this is no more and no less than election window dressing.
    The Prime Minister: I realise the anxiety with which the hon. Member's thoughts are concentrated on possible forthcoming events. I beg him to contain his impatience. In terms of inflation, it is important that he should not, by slipshod words, convey an impression that is incorrect. I do not suppose that he intended to do so. Nobody has said that inflation will continue indefinitely into the future at single-figure rates. What my right hon. Friend the Secretary of State for Prices and Consumer Protection said was that it would continue at single-figure rates for the remainder of this year. What happens next year will depend to a large extent on the level of wage settlements, which begin again in the autumn. What is much more important than examining the statistical entrails every day is that the Government should have the will—as they have—to carry through their policy to keep down inflation.
    Mr. Joseph Dean: With due deference to the debate that will take place tomorrow, will my right hon. Friend take time today to remind the general public of the substantial benefits which the Government's existing economic and financial policies have brought to the workers and the under-privileged sections of our society?
    The Prime Minister: I do not wish to anticipate tomorow's debate. It is true that the family budget was distorted by the Opposition and that the measures that
    828
    we propose to take will remedy the situation. Nothing can alter the fact that pensions will increase, that child benefit will improve, and that there will be a tax rebate in July. All these are valuable benefits, but we must not be complacent, because there is a great deal to do. I constantly remind the country of this. I did so again at the Nottingham miners' gala last Saturday.
    Mrs. Thatcher: As one of the Prime Minister's duties today is to answer Questions in the House, will he tell us why, in his package of economic measures, he deliberately chose to put a tax on exports and on all home production, thereby making us more vulnerable to imports?
    The Prime Minister: There were many means by which we could have put right the recklessness of the Opposition in adding £500 million to the Budget by reducing taxation. We considered them, and no doubt the House will debate them tomorrow. Having looked at them carefully, it seemed to me that because the whole House agrees that inflation is the vital issue, it would not have been appropriate to take action through value-added tax, which might have been sensible in other directions but would have had the effect of pushing up inflation. Therefore, we chose the national insurance surcharge. I dare say that if we had chosen VAT there would have been complaints from the Opposition that we had not chosen something else.
    Mrs. Thatcher: If the Prime Minister has no confidence in the decisions of the House of Commons about cutting income tax, he knows exactly what he can do about it, because it lies in his power to make arrangements to elect a new one. In the meantime, does he not recall that his Chancellor of the Exchequer, during his Budget speech, dismissed the claim of the Liberals when they wanted to increase the national insurance contribution by saying that it would be wrong to threaten jobs at a time of unemployment, wrong to put up industrial costs when we had a problem of competitiveness, and wrong to introduce a tax which would be passed on in prices at a time of higher inflation? Why has he changed his mind?
    The Prime Minister: With respect to the right hon. Lady, I must inform her that it is not I who changed my mind. It

    829
    is the Opposition who have added £500 million to the Budget. As I have said on earlier occasions at this Dispatch Box, I would much have preferred it if those reductions in tax had not taken place. We would then not have had to bring forward a proposal for national insurance surcharge. Both matters should have been left on one side. I very much regret that the House of Commons took this decision, but, as it did so, we intend, as we said at the time, to put the matter right. We intend to follow a sound financial policy on all these matters.
    Mr. Fernyhough: Does my right hon. Friend agree that what happens about inflation next year will depend largely on whether we have a Government who are prepared to co-operate with the unions or a Government who are determined to have confrontation with them?
    The Prime Minister: I think the last four years have adequately shown that the policy of the previous Government on confrontation and conflict was not successful. We have been much more successful in the policy of conciliation that we have followed. As for next year's incomes increases, I propose to wait, listen and hear what the trade union conferences which are now taking place have to say. They will come to an end in July. After that the Government will have to put forward their own proposals.
    Mr. Joseph Deanasked the Prime Minister if he will list his public engagements for 13th June.
    The Prime Minister: I refer my hon. Friend to the reply which I gave earlier today to the hon. Member for Leominster (Mr. Temple-Morris).
    Mr. Dean: I welcome my right hon. Friend's earlier reply to my supplementary question, but will he emphasise to the trade union movement the benefits which the Labour Government have conferred on their members, and stress that they should not be kidded by the Opposition, who appear to be trying to woo the trade unions with false promises?
    The Prime Minister: I shall certainly point that out to the trade unions, but I believe it would be better if there were an all-party view about the importance and significance of the trade union:: and of the great role that they play. It would
    830
    serve the Opposition far better if they were to emphasise that aspect, instead of constantly attacking the trade unions.
    Mr. Cormack: As the Prime Minister referred to this evening's banquet, will he reflect how he can best commemorate the extinction of freedom and democratic Socialism that took place in Czechoslovakia 10 years ago?
    The Prime Minister: President Ceausescu on that occasion spoke out clearly against what took place in Czechoslovakia, and I am very glad indeed that he did so.
    Mr. Nobleasked the Prime Minister if he will list his official engagements for 13th June.
    The Prime Minister: I refer my hon. Friend to the reply which I gave earlier today to the hon. Member for Leominster (Mr. Temple-Morris).
    Mr. Noble: In the course of a busy day, will my right hon. Friend find time to reflect further on the subject of inflation, particularly the rate of increase in food prices, which is now the lowest since 1970? Will he make it clear to the country that if the Opposition have their way in devaluing the green pound, the healthy situation that now obtains on food prices would be totally destroyed?
    The Prime Minister: I am glad to say that there is no doubt that food prices have risen far less rapidly in the past 12 months. The figure I have is 6·7 per cent., which is very good indeed. The devaluation of the green pound has the effect of putting up prices, but I repeat that it is the Government's policy and intention, so far as we can carry the country with us on issues in which the country is involved, to try to keep inflation down. We are succeeding at the moment, and we hope to continue to do so, because I think that the people of this country understand the issue.
    Mr. Higgins: Is it not the case that by increasing the national insurance contribution the Government will put up food prices, whereas if they increased value added tax that would not happen?
    The Prime Minister: An increase in value added tax would have put up immediately the retail price index substantially. [HON. MEMBERS: "What

    831
    about food?"] Hon. Gentlemen are baying as though they are in the zoo, waiting to be fed. The food index, as the hon. Member for Worthing (Mr. Higgins) knows, even if his Conservative colleagues do not, is part of the overall index and not separate from it, and forms only one element of it. The simple truth is that the Opposition cannot escape from the responsibility that they have forced the Government to introduce a measure that is unwelcome to the Government—namely, the national insurance surcharge. The only alternative would have been to increase value added tax, and that would have increased the retail price index even more. The Opposition can take their choice of which part of the responsibility they wish to assume.
    Mr. English: I know that my right hon. Friend has tried to alter this silly system, but will he, in future, when met with a Question such as the one before him, or Question No. 1, answer it in the style of an American President? Leaving out matters of security, will he give the details of his engagements during one day? That might persuade hon. Members that they should not ask Questions to which they do not want answers.
    The Prime Minister: As always, I shall take my hon. Friend's views into careful consideration.
    Mr. William Clark: If it is necessary to recoup the £500 million to the Treasury because of the amendments moved on the Finance Bill, will the Prime Minister explain to the country why it is essential to put a tax on employment of £1,500 million?
    The Prime Minister: The tax is to recover the amount that has been lost this year—namely, £500 million. That is what it will do. As I am sure the hon. Gentleman knows, the tax itself does not come into effect until November. There will be another Budget next April, when the matter may be reconsidered.

    ANKARA
    Mr. Christopher Priceasked the Prime Minister when he next intends to visit Ankara.
    The Prime Minister: I have at present no plans to visit Ankara.
    Mr. Christopher Price: If my right hon. Friend sees Mr Ecevit in the near future, will he tell him that although we welcome the new co-operation agreement between Europe and Turkey and sympathise with Turkey's economic difficulties, the present Government take human rights very seriously, particularly the machinery of the European Convention on Human Rights?
    What action will British Ministers take in Strasbourg when this matter is next considered? Is my right hon. Friend aware that if the complaints against Turkey about violations of human rights in Cyprus were got out of the way it would help Britain's reputation for a belief in human rights, in terms not just of complaints against Russia but of human rights throughout the world, and would assist a final settlement in Cyprus?
    The Prime Minister: I know that my hon. Friend takes a deep interest in these matters. The question of human rights, which my hon. Friend raised in the debate on foreign affairs last week, is a matter for the Council of Europe to reach a conclusion upon. I gather it has failed to do so on the last two occasions on which it has considered the subject. I hope that it will reach a just conclusion on the next occasion when it considers the matter. British Ministers will endeavour to ensure that that is done. If so, that conclusion should be published. I agree with my hon. Friend that this matter should not be left hanging around.
    Mr. Ian Lloyd: If the Prime Minister has an opportunity to discuss these matters with the Turkish Government, will he explain to them that if they have either civil or military aircraft with Rolls-Royce engines requiring repair, the possibility of having those engines repaired will depend not on whether they pay the bill but on the view taken by the T and GWU—not the Foreign Office—of human rights?
    The Prime Minister: No, Sir. I do not think that it will be necessary to explain that to the Turkish Government.
    Mr. Molloy: In view of world concern about human rights, and particularly in respect of the discussions taking place between the two great Powers—the United States and Russia—on the dangerous situation that still exists in Africa

    833
    and the serious situation affecting the policy of detente, what is my right hon. Friend's view about the holding of a summit conference in the not-too-distant future?
    The Prime Minister: As my hon. Friend knows, a conference of seven of the major industrial Powers is to take place, but I do not believe that we shall be discussing the question of Africa or detente. That conference will be concerned with the economic prospects of the Western world.
    Mr. Hooson: Does the right hon. Gentleman think that the richer NATO countries should extend more economic aid to Turkey and to Greece, particularly having regard to their key position in NATO and the fact that the Soviet Union is extending more and more economic aid to Turkey?
    The Prime Minister: That matter could be looked into. When the Turkish Prime Minister, Mr. Ecevit, saw me, he asked whether we could assist in supplying arms because of the difficulties that Turkey is having with the United States Congress. I undertook to look into the matter, but so far no propositions have come forward that would be satisfactory.

ROLLS-ROYCE ENGINES (CHILE)
Mr. Adley: 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 deliberate and provocative refusal of Her Majesty's Government to return to the Government of Chile four Rolls-Royce Avon engines, the property of that Government, sent here for servicing in 1973 and subsequently held by Her Majesty's Government at the instigation of shop stewards at the East Kilbride factory of Rolls-Royce, where the engines are currently held in defiance of a court order that the Chileans' property should be released and returned to them."
This is a specific matter because it refers to a known consignment of Rolls-Royce Avon engines. It is a specific matter because it is known to the Department of Industry, which in an answer to a Written Question last night informed the House that the Chilean Government
834
"have applied for an export licence for the Avon engines and this application is currently being considered by the Departments concerned."
I stress the plural "Departments", which I believe is relevant, as I shall later show. It should be borne in mind that the answer fails to point out that this issue dates back to 1973, when the engines were sent here, or certainly to 1974.
The matter is urgent because the news of the court action has only just become public, it appearing to have been concealed by Her Majesty's Government. There seems little doubt that other foreign Governments, or foreign customers, considering sending goods to Britain for servicing, will be confused by these events and will want to know just where they stand in the event of there being a change of Government while their goods are here, or in the event of shop stewards taking the law into their own hands. The issue creates doubt among trading partners and puts our exports at risk. The matter is, therefore, urgent.
I feel that there is little doubt about the importance of the matter. It is not merely a commercial matter. The implications of the Government's action—bowing to the threat of force of the shop stewards and defying a court order—indicate that my right hon. Friend the Member for Sidcup (Mr. Heath) was right when in 1974 he asked the people "Who governs Britain?".
I stress that, however important this issue is, we are not discussing the rights or wrongs of the situation in Chile. We are not discussing the sale of arms, because the engines belong to the Chilean Government. They have been paid for years ago. We are discussing nothing less than international banditry by Her Majesty's Government.
I have sought, Mr. Speaker, to find an analogy which I think is relevant. If you, Mr. Speaker, were to take your bicycle to a cycle repair shop, and that shop subsequently were to be taken over by, shall we say, the hon. Member for Sheffield, Hillsborough (Mr. Flannery), who decided that he did not like you and that he would keep your bicycle, and you subsequently went to a court of this land and obtained a court order to the effect that you could have your bicycle back and the owner of that shop decided that you were not to have your bicycle back, you

835
would think, Mr. Speaker, that that was a poor show. When that is done by a Government entitled Her Majesty's Government, it is a serious matter.
I refer finally—
Mr. Flannery: On a point of order, Mr. Speaker.
Mr. Speaker: Order. First, the hon. Member for Christchurch and Lymington (Mr. Adley) picked on the wrong George when talking about a bicycle. However, he is coming to a conclusion.
Mr. Adley: I finally refer back to the answer that was given last night containing the use of the plural "Departments". The Department of Industry did not indicate which other Government Departments were involved. Was it the Ministry of Defence, to which I originally tabled the Question? Was it the Foreign and Commonwealth Office? Both Departments have maintained a gutless silence in the face of this long delay.
The use of the phrase "the rule of law" tends to be over-used, but in this instance I submit that the Government are stealing somebody else's property. That cannot be condoned by the House, nor even by the Government. On that basis, Mr. Speaker, I seek your agreement that we should debate the matter at an early date.
Mr. Speaker: The hon. Gentleman gave me notice before 12 o'clock this morning that he proposed to ask leave to move to Adjournment of the House for the purpose of discussing a specific and important matter that he believes should have urgent consideration, namely,
"the Government's attitude towards the court order to return aero engines the property of the Chilean Government to that Government".
I listened carefully to what the hon. Gentleman said. The House knows that it is not for me to decide the importance of a matter but whether it requires an emergency debate in the House. I have to rule that the hon. Gentleman's submission does not fall within the provisions of the Standing Order. Therefore, I cannot submit his application to the House.
Mr. Flannery: On a point of order, Mr. Speaker. The hon. Member for Christchurch and Lymington (Mr. Adley) implied that I have your bicycle. I can
836
assure you, Mr. Speaker, that unless a military coup takes place in my shop I shall ensure that you get your bike back.
Mr. Speaker: I am obliged. It is 40 years since I had a bicycle.

ROLLS-ROYCE ENGINES (CHILE)

  WELSH AFFAIRS
  Ordered,
  That the matter of Youth Unemployment in Wales, being a matter relating exclusively to Wales, be referred to the Welsh Grand Committee for their consideration.—[Mr. Coleman.]

STATUTORY INSTRUMENTS, &c.
Mr. Speaker: By leave of the House, I shall put together the Questions on the three motions relating to Statutory Instruments.
Ordered,
That the draft Social Security Benefits Up-Rating Order 1978 be referred to a Standing Committee on Statutory Instruments, &c.
That the draft Supplementary Benefits (Determination of Requirements) Regulations 1978 be referred to a Standing Committee on Statutory Instruments, &c.
That the draft Child Benefit and Social Security (Fixing and Adjustment of Rates) Amendment Regulations 1978 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Coleman.]

WATER SERVICES CHARGES (REBATES)
3.38 p.m.
Mr. Andrew F. Bennett: I beg to move,
That leave be given to bring in a Bill to provide for rebates on water services charges in respect of pensioners and low income families.
A large number of my constituents have written to me about water services charges. Probably most hon. Members know them better as water rates. However, they were renamed in the 1973 legislation. More recently, in addition to the letters that constituents have written, I have taken the trouble to consult many of my constituents on what is clearly to them a major problem. Many of them have taken much trouble clearly to express their views to me.
It is clear that all my constituents who have spoken to me are dissatisfied with the North-West Water Authority and the

837
way in which its charges have increased and increased since it was set up in 1973. It is clear that the Authority is extremely unpopular. Indeed, almost every other water authority in England and Wales is equally unpopular. That which concerns my constituents especially is that the North-West Water Authority is in no way publicly accountable. It is run by a board of appointed people who have no responsibility to the public in any way. My constituents find this a deplorable situation.
My constituents are particularly concerned at the way in which the North-West Water Authority appears to have carried out many public acts which appear deliberately to push up charges. They are particularly appalled—it may be a small matter—about the incident regarding the chairman's number plate. They are concerned about the glossy annual reports which the North-West Water Authority sends out. They are concerned about the way in which industrial metering has been changed and the problems that has produced for sprinkler companies and others. They are concerned about the way that bills are being sent out. At one time bills were sent out from the local town hall. But the North-West Water Authority set up its own empire to send out the bills. There are many areas in which the North-West Water Authority appears unnecessarily to have put up charges.
It is clear that those of my constituents whom I have consulted would like me to bring forward a Bill to abolish the North-West Water Authority. I suspect that in the country as a whole a Bill to abolish the water authorities would be extremely popular. But, as far as I can see, that is not practical in a Ten-Minute Rule Bill. I think that my constituents would like the water authorities to be abolished, the Government nationally to take responsibility for collection of water and disposal of sewage and the local authorities again to have the task of supplying water to individual premises and to remove sewage. But that is not practical in a Ten-Minute Bill. However, I hope that the Government will do something about the matter quickly.
I am seeking leave to introduce a Bill which will relieve the worst of the hardship. The use of rateable values to make charges is not fair when dealing with
838
general rates, but at least one can justify using rateable values for the general rates, because that system permits local democracy to have some say in the levels of expenditure on services. We managed to reduce some of the unfairness of the general rate as a result of legislation in the early 1960s which introduced the means test and produced the rates rebate. Therefore, we can say that rates allow for local democracy and some modification as a result of the means test and rate rebates.
However, rateable values, when used for water services charges, even if a standing charge is involved, are in no way controlled by locally elected people and take no account of how much water or sewage is involved in a particular household. Nor do they take account of the individual's ability to pay.
Rebates for general rates were first introduced in the 1960s. If we had included the water rate at that point, the charge would have been very small—in most instances under £5. To have included that in the rebate system would have involved a lot of unnecessary administration for very little benefit. But that is no longer true. The water rate and sewerage charges are becoming considerable burdens.
I should like to quote one example of one of my constituents, Mr. Williams, who came to my advice bureau on Saturday morning. I think that his problem is typical of that facing many pensioners. He had with him two bills. One was for his general rates. It set out clearly that the charge for his premises would be £121. He then had his rebate taken into account. As a result of the means test and his ability to pay, he had to pay £16·58. His bill amounted to £121, but it was reduced as a result of the rebate to £16·58.
The second bill was his water service charge which worked out at £35·66. There was no rebate on that at all. Therefore, the actual amount that he had to pay was £35·66. In other words, he was being asked to pay over twice as much for water and sewerage as for all the other local government services. In his case and in many other cases the water and sewerage charges are now causing a great deal of hardship. We are, in effect, asking for 50p or £1 a week for water and sewerage services.

839
I know that some of the boards have made great claims about having made it easier for people to pay by instalments or a stamp scheme. But most of these easy payment schemes are not easy payment schemes at all, because they involve people making payments much earlier than if they paid the lump sum.
I suggest that the problem is particularly acute for pensioners who have a grievance about the amount of water that they use. It is also true for many low-income families who have great difficulty in finding a lump sum of about £50 to pay these charges.
I have had many letters from pensioners pointing out how little water they use. Often they feel resentful that they cannot use more water. Many of them find it extremely difficult to get in and out of a bath, so they do not use as much water as they would like. Others, who cannot afford automatic washing machines and take their clothes to a launderette, find that they have to pay for the water that they might have been able to use at home in addition to the charge at the launderette to have their clothes washed.
Many pensioners live next door to families which have two or three children. Such families have frequent baths and often have an automatic washing machine. Water is also used for the garden or for cleaning the car. In such households the tanks and the pipes never seem to stop gurgling as the water goes through. Yet for pensioners living next door, who use very little water, the charges are identical.
Some of my constituents believe that metering water supplies would solve the problem, but the vast majority are opposed to metering on public health grounds and the cost of installing and reading water meters. They feel that the immediate need is to give a means-tested
840
rebate on the water services charge and then to get on and reorganise the water authorities. They feel bitter about the reorganisation not only of the water authorities but of the Health Service and local government generally by the Conservative Government in 1973. However, they are increasingly beginning to say "That lot may have made a mess of it in 1973. But why on earth have not this Government got on with putting things right since?"
I ask the House to allow this Bill to be introduced. My constituents know that at this point in this Session it does not have much chance of becoming law. However, they ask the Government to see the need to do something now and to note the justice of rebates on water services charges. They hope that it will not be necessary for an hon. Member to raise this matter again next Session, but that the Government will take a lead from the national executive committee of the Labour Party and ensure that it becomes Government policy that we have rebates on water charges and that they either bring forward legislation or support my Bill.
Question put and agreed to.
Bill ordered to be brought in by Mr. Andrew F. Bennett, Mr. George Rodgers, Mr. Max Madden, Mr. Brian Sedgemore, Mr. Robert Kilroy-Silk, Mr. Frank Allaun, Mr. Mike Noble, Mr. Terry Walker and Mr. James Lamond.

WATER SERVICES CHARGES (REBATES)
  WATER SERVICES CHARGES (REBATES)
  Mr. Andrew F. Bennett accordingly presented a Bill to provide for rebates on water services charges in respect of pensioners and low income families; And the same was read the First time; and ordered to be read a Second time upon Friday 14th July and to be printed. [Bill 145.]
ORDERS OF THE DAY
  STATE IMMUNITY BILL [Lords]
  As amended (in the Standing Committee), considered.
  STATE IMMUNITY BILL [Lords]
    Clause 3

      COMMERCIAL TRANSACTIONS AND CON TRACTS TO BE PERFORMED IN THE UNITED KINGDOM
      3.50 p.m.
      The Parliamentary Secretary to the Law Officers' Department (Mr. Arthur Davidson): I beg to move Amendment No. 1, in page 3, line 1, leave out from 'loan' to 'other' in line 2 and insert
      'or other transaction for the provision of finance and any guarantee or indemnity in respect of any such transaction or of any'.
      The purpose of this amendment is to widen the scope for non-immunity with regard to all financing transactions. It is intended to meet a criticism of the existing provisions and of the amendment moved by my right hon. and learned Friend the Solicitor-General in Committee.
      The criticisms were voiced by the right hon. and learned Member for Wimbledon (Sir M. Havers). I hope that he will concede that these provisions clearly cover transactions for the provision of finance by means of forward purchase of foreign exchange over the next few years. The right hon. and learned Gentleman specifically mentioned that example in Committee.
      I thank the right hon. and learned Member for Wimbledon for the constructive contributions that he has made towards making this a more comprehensive Bill. I also wish to put on record, as the Solicitor-General did in Committee, the great assistance which has been given by the City of London Solicitors' Company. Its advice has also been invaluable. I hope that the right hon. and learned Gentleman will find that this amendment meets his criticisms.
      Sir Michael Havers: The passage of this Bill has been a tribute to the valuable co-operation which has
      842
      existed between the Lord. Chancellor's Office, Ministers and the City of London Solicitors' Company. Between them they have done much to improve the Bill.
      This amendment is another example, following the objections that I raised in Committee, of Government reaction to make improvements, with the assistance of the City of London Solicitors' Company. It covers one example which I raised in Committee because the amendment that was moved then still left open a gap.
      I wish that it were possible to remove the doubt about the definition of the exercise of sovereign authority. A solicitor should not be left in a position where he is unable to advise a client whether in certain cases the exercise of sovereign authority may operate and is therefore unable to give a firm a certificate that it will not apply. This could still have a damaging effect. The object of the Bill is to remove that doubt. That doubt still exists for the reasons that I explained in Committee.
      It might be worth considering whether it is possible to look at the nature rather than the purpose of the transaction or activity in question so that one could get round the difficulty. As a matter of law, there is support for an amendment on those lines. In Lord Denning's judgment on the famous Trentex case, he held that by entering into a commercial transaction a State waives its immunity as regards proceedings relating to that transaction and that in deciding whether a transaction was a commercial one the intrinsic nature of the transaction rather than its object was the material consideration. In Article 7 of the convention on State immunity there is support for what I say.
      In the spirit of co-operation that exists in both Houses I suggest that the Parliamentary Secretary should consider again the amendment which, unfortunately, was a starred amendment and could not be discussed. The Government have a chance to think again and to make the necessary amendments in the Lords.
      Mr. Arthur Davidson: I thank the right hon. and learned Member for Wimbledon (Sir M. Havers) for what he said. The purpose of the amendment is to ensure that the advice of lawyers to their clients is given with as much clarity and certainty

      843
      as is reasonably possible. The right hon. and learned Gentleman's suggestions have helped.
      I understand what the right hon. and learned Gentleman is getting at. He will appreciate that the determination whether there has been an exercise of sovereign authority will have to be made in the light of the circumstances of each case. It is not easy to foresee how the definition that he suggests would work in the context of the many varied circumstances that would arise.
      Establishing what is the nature of a transaction or activity is likely to involve an examination of all aspects of that transaction or activity. It is difficult to see how the amendment suggested by the right hon. and learned Gentleman would assist the court since it would merely impose a limitation on the consideration of the question whether there has been an exercise of sovereign authority. Instructing a court to consider the nature of a transaction would not lead it to consider anything that it would not consider in any event.
      Without making any firm assurances that an amendment will be tabled in the Lords, I assure the right hon. and learned Gentleman that I shall look at the matter again on behalf of the Government.
      Amendment agreed to.
      Mr. Speaker: I congratulate both the right hon. and learned Member for Wimbledon (Sir M. Havers) and the Parliamentary Secretary on not discussing the other amendment.

    Clause 13

      OTHER PROCEDURAL PRIVILEGES
      Mr. Arthur Davidson: I beg to move Amendment No. 2, in page 7, line 31, leave out from first 'property' to 'which' in line 32.
      Mr. Speaker: With this we may discuss Government Amendments Nos. 4 and 5.
      Mr. Davidson: Amendment No. 2 is a drafting amendment. Amendment No. 4 is a paving amendment. Amendment No. 5 is of substance. It has three main objects. First, its purpose is to clarify the drafting of Clause 14(3) which my right hon. and learned Friend the
      844
      Solicitor-General undertook to examine in Committee in answer to criticisms and doubts raised by the right hon. and learned Member for Wimbledon (Sir M. Havers). Secondly, it brings together all the provisions relating to central banks in one place. I am sure that the House agrees that that is sensible. Thirdly, it ensures that a central bank or other monetary authority shall have the same immunity with regard to execution or in respect of relief by way of an injunction or order for specific performance or for the recovery of land or other property as a State shall have, irrespective of whether the central bank is a separate entity or is acting in the exercise of sovereign authority.
      Under the Bill as drafted the immunity of a State's central bank which is a separate entity and is not acting in the exercise of sovereign authority is slightly less than that of a central bank in other circumstances. That is the point that the right hon. and learned Gentleman made in Committee. I hope that he agrees that this amendment covers the point satisfactorily.
      Sir M. Havers: I hope that what the Minister said rang with great clarity in your mind, Mr. Speaker. But it is a highly technical matter. The amendment follows an issue that I raised in Committee basically because the independence of the central banks is jealously guarded by them. It is essential that they should be put into an entirely independent position throughout the Bill. I am grateful to the Government for responding to what I said in Committee.
      Amendment agreed to.
      Mr. Arthur Davidson: I beg to move Amendment No. 3, in page 7, line 42 leave out from '(5)' to 'to' in line 44 and insert:
      'The head of a State's diplomatic mission in the United Kingdom, or the person for the time being performing his functions, shall be deemed to have authority to give on behalf of the State any such consent as is mentioned in subsection (3) above and, for the purposes of subsection (4) above, his certificate'.
      I hope that I shall explain this amendment with the same clarity. It is equally technical but I am sure that you. Mr. Speaker, will understand every word of it.
      The purpose of the amendment is to meet the criticism that whereas Clause

      845
      2(7) specifies who may submit to proceedings on behalf of the State there is no provision in Clause 13 about who should be deemed to be entitled to give the consent of the State to execution or to the issue of relief against it by way of an injunction. The amendment provides that it is the head of the State's diplomatic mission who shall be deemed to be competent to give such consent.
      There is no need to make any special provision with respect to consent given in a prior written agreement because if the court is satisfied that the agreement was made on behalf of the State, the consent clause in the agreement is sufficient. Provision is needed only to cover the cases where there is no prior consent to execution.
      4.0 p.m.
      Particularly since I have expounded it with such complete clarity, I hope that the right hon. and learned Gentleman will consider that that meets his point.
      Amendment agreed to.

    Clause 14

      STATES ENTITLED TO IMMUNITIES AND PRIVILEGES
      Amendments made: No. 4, in page 8, line 40, after "entity", insert
      "(not being a State's central bank or other monetary authority)".
      No. 5, in page 8, line 44, leave out from "entity" to end of line 5 on page 9 and insert—
      "(4) Property of a State's central bank or other monetary authority shall not be regarded for the purposes of subsection (4) of section 13 above as in use or intended for use for commercial purposes; and where any such bank or authority is a separate entity subsections (1) to (3) of that section shall apply to it as if references to a State were references to the bank or authority.".—[Mr. Arthur Davidson.]
      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, with amendments.

  COMMUNITY SERVICE BY OFFENDERS (SCOTLAND) BILL
  As amended (in the Standing Committee), considered.
  COMMUNITY SERVICE BY OFFENDERS (SCOTLAND) BILL
    New Clause No. 2

      NATURE OF COMMUNITY SERVICE
      "In determining the nature of community service the courts may request the local authorities to relate the work to the nature of the offence.".—[Mr. Teddy Taylor.]
      Brought up, and read the First time.
      4.3 p.m.
      Mr. Teddy Taylor: I beg to move, That the clause be read a Second time.
      As the House will be aware, this Bill introduces community service orders in Scotland. As the Minister explained in Committee and on Second Reading, we have had a number of experiments in Scotland so far, and the Bill provides formally the powers to introduce the scheme throughout Scotland.
      In Committee the Opposition moved a new Clause which suggested that in determining the nature of community service the courts and local authorities should have regard to the desirability of relating the work to the nature of the offence. The Minister certainly accepted our reason for putting the proposal forward. We thought that a useful use of community service might be, particularly in cases of vandalism and malicious mischief, that the penalty should seek to ensure that the person who had committed the crime should carry out some public service or work associated with it.
      One obvious example would be that if a vandal had been caught putting graffiti on a wall, it might be a useful discipline for him to be invited to clean up the mess. That was the kind of thing that we had in mind and why we proposed the new clause in Committee. However, the Minister put forward a convincing argument and a number of reasons for not accepting it. As reported in column 87 of the Committee proceedings he said that it was not possible or practicable for the court to have the detailed knowledge of the kind of work that an offender should be doing against the background of his offence, and he said that it was not possible or practicable for the courts to have

      847
      detailed knowledge of the availability of work that would be required.
      He pointed out that under the Bill it was for the courts to determine the number of hours that a community service order would run for an offender, and that it was for the social work departments, which would supervise the order, to decide the content of the work which the offender would perform.
      In spite of the Minister's explanation, the Opposition pressed the matter to a Division. After one of the intermittent visits, such as we are again having today, of the hon. Member for Glasgow, Garscadden (Mr. Dewar), we stood by our belief in the value of the clause.
      The Minister rejected our case, but he indicated that in considering giving an offender a community service order the court would have the ability to recommend that an offender should carry out certain work. That is what we are trying to propose today as a compromise. We think that this is something which could be done, as the Minister has indicated, and it might be useful and helpful to write that into the law. That is why we are putting forward the new clause which it appears has the unanimous support of the Liberal Party. Under the clause the courts, in determining the nature of the community service, may request the local authorities to relate the work to the nature of the offence.
      There is no doubt that the whole country is concerned not only about the increase in crime, but about the extent to which our prisons are becoming full. The Minister supported his Bill by saying that it might be an alternative to imprisonment or a fine. There was a telling example of the increased recognition that now exists of the problems of vandalism only last night when the Minister of State, Department of Health and Social Security, winding up a debate on preventive medicine, asked what might be done about children buying cigarettes from automatic vending machines. He pointed out that the problem was disappearing because the machines were being destroyed by vandals.
      We have put forward a reasonable compromise which is consistent with the Under-Secretary's words in reply to our new clause in Committee. We are not
      848
      saying, as we said in Committee, that the courts should have the absolute power to determine the nature of the work of community service. We say only that in determining the nature of community service the courts may request the local authorities to relate the work to the nature of the offence.
      In Committee the Under-Secretary pointed out that it might be preferable for an offender to do some work which was related to his special skills or abilities. What we have in mind is a form of service related not to particular skills or abilities but to something which does not need a great deal of skill. It would be most useful if someone who destroyed a garden had to do some gardening. Equally, it would be useful if someone who defaced a wall had to clean it up. It would be quite wrong if the courts were to have no indication in the Act that they could influence the nature of the work done.
      I hope that the Minister will accept our clause as being fair and reasonable and consistent with his speech in Committee. I hope that he will accept that if we do not put in the clause there will be nothing in the Bill to give the courts the right to determine or influence the nature of the work to be done.
      Mr. George Thompson: I intervene briefly to support the clause, as I supported the earlier clause in Committee. I took the point that the Minister made then, and I congratulate the hon. Member for Glasgow, Cathcart (Mr. Taylor) on having phrased the new clause in a way that meets the points raised by the Minister. I hope that the Minister will accept it.
      The hon. Member for Cathcart referred to special skills. It might be possible to make someone who has wrecked a garden do some gardening. But that person might be completely hopeless at gardening and might replant the flowers or potatoes in such a way that they simply would not grow. The clause will mean that the local authorities, which will have the responsibility of devising the schemes, will be able where it is appropriate to make the punishment fit the crime and, where that would not be appropriate, because of the offender's lack of skill, they could choose some other form of work. I therefore commend the clause to the House.
      Mr. Donald Dewar: Like the hon. Member for Galloway (Mr. Thompson), I rise only briefly. This matter was aired in Committee, and although the hon. Member for Glasgow, Cathcart (Mr. Taylor) has ingeniously altered the wording of the clause, his arguments remain basically the same. I think that he now has the worst of the argument.
      To suggest that in determining community service the courts may request the local authorities to relate the work to the offence is to invite friction. There is nothing to prevent the sheriff from expressing his informal opinion, and I hope that an opinion expressed by a sheriff would also be persuasive on a social work department.
      However, the clause would not give the courts the right to determine, instruct or lay down the sort of work to be done. It merely gives a spurious kind of statutory authority to a sheriff's suggestion. I believe that either a sheriff should have the power—a proposal that was rejected in Committee—or the matter should be left on a completely informal basis. The clause is something of a halfway house which may be ingenious but is certainly not desirable.
      I remain of the view—and I hope that my Front Bench will also remain of the view—that however attractive it is to argue that the punishment should be made to fit the crime, given the difficulties over the availability of jobs under a community service order and the difficulties of supervision—whether by statutory staff or by people in the voluntary sector who may have an offender seconded to them—that the placing of the person who has been put under a community service order should and must remain the responsibility of the social work department.
      In a way, if we were to follow the reasoning and the logic of the hon. Member for Cathcart what we would be doing would be confusing the role of the social worker and the sheriff. I believe that that would be a mistake.
      It is clearly a matter for the sheriff to look at the offender, to look at the circumstances of the offence, and to look, perhaps, at the public interest, and to decide in terms of the Bill, when it is an Act, whether the person could appropriately be made the subject of a com-
      850
      munity service order. It seems to me that we must leave to the social worker the judgment how that should be carried out and which particular tasks, given the range that is available, are appropriate in the individual case.
      I am not necessarily quarrelling with the theory that if someone destroys a garden—as has been suggested—work in public parks, therefore, or in tidying up the gardens of old-age pensioners, and so on, might well be appropriate. But I do not think that the nature of the offence is or ever can be the only criterion that should govern where someone is placed in terms of a community service order.
      It may be that the person has special skills of another kind that the sheriff, when making the order or when making the kind of recommendation for which the Conservatives wish in the new clause, will not have the full information about the skills and aptitudes or, indeed, the full availability of the work that is available to the social worker when he decides on the final placement.
      I would not wish to fetter the discretion of the sheriff in making suggestions, but it seems to me that it is inappropriate that the power to suggest should be enshrined in the Bill, as the hon. Member for Cathcart is suggesting. I should prefer to leave it as a social work judgment. After all, if we were to have this power, it seems that we would have to have a situation in which the social worker, when providing the original report, would give an exhaustive list of all the places that are available at that stage and the whole range of community service tasks. The sheriff would then have to give attention to what was available as well as what seemed peculiarly appropriate in terms of the offence that he was considering.
      It seems to me that the new clause is inappropriate. It is inviting the sheriff to do something which he is not qualified to do and which, in the majority of cases, it would not be appropriate for him to do. I should prefer to leave the Bill as it is and leave it to the social worker, once the decision on suitability for a community service order has been made by the court, with his particular and specific expertise to decide on the best method of supervision and the best way in which a community service order should be implemented.
      Mr. Nicholas Fairbairn: I listened with care to what was said by the hon. Member for Glasgow, Garscadden (Mr. Dewar). There is some validity in it at first hand. However, I rise to support the new clause, and for this reason. Given a social worker upon whom there is the necessity to find something for someone upon whom a community service order has been imposed, perhaps he will just look at the matter and say "What shall we do with you, George? I know. You can go and repaint the footbridge at such and such a place." I think that there will be a grave likelihood, in view of the pressures on such people, that they will merely find a job for them to do in order to exercise the order.
      I am impressed by the new clause because it is important that there should be a relationship between the punishment and the offence. I say that because I remember that shortly after the war there was a competition amongst schoolchildren as to what they would have done to Hitler if they had been able to punish him alive. The child who won said this: "Turn his heart kind and then introduce him to his victims."
      I think that it is easy, perhaps, for a child to wreck a fence or to throw a bottle through a window, but to have to meet the family through whose window the bottle was thrown or to have to dig the garden of a poor old women after one has wrecked it could be a most beneficial and reasonable way of introducing the awfulness of a crime. Crime is so easy to commit at a long distance and so difficult to commit face to face.
      If the new clause is accepted, the relationship in which we may achieve some resolution of the criminal abandon in the realisation of a human effect might well be realised. That is why I support the new clause.
      4.15 p.m.
      The Under-Secretary of State for Scotland (Mr. Harry Ewing): As the hon. Member for Glasgow, Cathcart (Mr. Taylor) pointed out, we are returning to a discussion that we had at length in Committee on another new clause moved by the Opposition. I indicated then that, for various reasons, I did not feel able to accept it. I do not feel able to accept this new clause either.
      852
      Perhaps I could begin with the remarks of the hon. and learned Member for Kinross and West Perthshire (Mr. Fairbairn). With great respect, there seems to be a fundamental misunderstanding of the community service system as it has been set up and as it has operated in the four experimental areas in Scotland that we have had over the past few months. There seems also to be a belief that the courts have no say or influence in the kind of work that is made available to offenders. That is a total misconception of the position, because in the four experimental areas, and in all areas in which in future the social work department advise my right hon. Friend the Secretary of State that a community service order scheme is available and my right hon. Friend would in turn inform the courts, local advisory committees have been set up.
      A local advisory committee consists of representatives of the police, the social work department, the trade union movement—which has a role to play in this matter in identifying the kind of jobs that could be made available to the offenders for community service work—and representatives of the sheriffs. Therefore, the courts themselves have some say and influence in the kind of work that is made available to offenders who are made the subject of community service orders.
      The new clause would merely confuse the position of the social work department vis-à-vis the courts.
      The hon. Member for Cathcart has framed the new clause to state:
      "In determining the nature of community service the courts may request".
      That presupposes that it is the courts that determine the nature of the community service. That is not so. It is the social work departments that determine the nature of the community service when they are putting these schemes together. Therefore, the new clause would have the effect of confusing the position of the court vis-à-vis the social work department which would administer the community service order once it has been attached to an offender.
      Even apart from that, the new clause is unnecessary because at present courts have powers to make recommendations when an offender comes before them. We should bear in mind that we are still talking about a position in which the offender

      853
      has in the first place to accept a community service order. We are not talking about a position in which a community service order could be applied against the wishes of the offender.
      It may well be—it is only speculation—that the giving of this kind of power to the court would have the effect of stopping many offenders who would be disposed of by the CSO disposal method from accepting a CSO, albeit that the alternative to that would possibly be imprisonment. One should think of the effect on the offender of courts having this kind of power.
      Mr. Teddy Taylor: Does the Minister agree that the present position is that a sheriff would be making such an order almost blind, not having any knowledge of the kind of work which would be done? Would it not be helpful to put in the Bill some indication of the court having some influence on the matter, otherwise many sheriffs will be in the difficulty of agreeing to make a CSO which in the course of events might in their view prove to be totally unsuitable.
      Mr. Ewing: The hon. Member for Cathcart misses the point that I made at the beginning that in deciding the kind of jobs that would become available in a social work area the sheriff has a say through the local advisory committee, which is made up of the sheriff, the police, the social work department and the local trade union movement. What the hon. Member is saying in proposing the new clause is that the sheriff should have an extension of this power to identify a job that had not been identified by the local advisory committee as being part of the community service by offenders scheme that had been put together by the regional council's social work department. That would be dangerous. It is not the kind of power that the courts would welcome.
      We have had many representations on the Bill about all sorts of matters, major and minor. But this is one of the issues on which we have had no representation. The courts and the social work departments are happy with the way in which the experiment has worked. No concern has been expressed to us on the matter.
      As my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) has
      854
      said, we would be in danger of loading the statute book with unnecessary requirements when at present the court has the ability to say to a social work department that the sheriff thinks that the offender should be put to work on such-and-such a job. The sheriff will know what jobs are available, because he is part and parcel of the local advisory committee set-up.
      Mr. Fairbairn: I was not on the Committee, though I have read some of the proceedings of the Committee. Does the advisory committee and the trade union members on it say what work they will tolerate offenders doing, and thereafter does the sheriff merely commit them to it and say that the work will be gardening rather than painting lamp posts, if local authority employers will allow such work to be done by offenders? Do I understand that the sheriff has no power to say "You will not just dig gardens, but you will dig Mrs. Smith's garden"?
      Mr. Ewing: The hon. and learned Member, of all people, appreciates that we live in a democracy, and that—I hope it always remains the same—we can do basically only what we can get agreement to do.
      Mr. Fairbairn: By the unions.
      Mr. Ewing: Not necessarily by the unions. Sometimes more often by the legal profession. Often many of the things that we would like to do have been frustrated not by the trade union movement but by professional organisations such as the legal profession. I do not complain about that. We are a consensus nation and can do only what we are allowed to do.
      We have had these experimental schemes running for some months and have experienced no difficulty with them. We are therefore anxious to extend these schemes—we are on the point of doing so—and to get one more region in Scotland. We are anxious, as the Bill provides, to give this scheme legal back-up. The powers contained in the new clause are totally unnecessary because the courts already have the power to suggest to a social work department what work an offender should do. Such a recommendation will be made with the knowledge of what jobs are available.
      The basis of the new clause is that we should make the punishment fit the crime.

      855
      I am not opposed to that. However, we must bear in mind also that there are some offenders who for various reasons would not be suitable to do some jobs that people are suggesting might be made available to those treated by the CSO system.
      I have been no more convinced in this debate than I was in Committee. No new points in support of the proposition put to us in Committee have been made today in support of the amended proposition. I accept that it is an amended proposition. It is not good legislative government to clutter up the statute book with this kind of unnecessary requirement. I hope that the House will not allow the new clause to be read a Second time.
      Mr. Alexander Fletcher: We were encouraged to see among the names added to the new clause three distinguished Members of the Liberal Party. We were disappointed that in this short debate none of them has seen fit to come into the Chamber to support the new clause.
      We have tried to give the Minister the opportunity for second thoughts on the matter. We discussed this at some length in Committee and we felt then that the Minister was too rash in rejecting our proposal. The Minister today still takes a narrow view of the point that we are anxious to make. In the Bill the local authorities will have the sole responsibility of deciding the sort of work that offenders should do. Yet the courts, where the case will be heard, will have exercised their option under Clause 1 of the Bill of making a CSO instead of imprisonment, a fine or taking some other action.
      This is important as the court will have heard all of the evidence and judged the character of the offender before deciding that a CSO is appropriate. It is difficult to follow the argument put forward in Committee by the Minister.
      Mr. Harry Ewing: Does the hon. Member not accept that the courts have an influence, through membership of the local advisory committee, on the kind of jobs that are made available for community service by offenders? If he accepts that, the new clause is not necessary.
      Mr. Fletcher: There is no reference in the Bill to courts having an influence through advisory committees, which are presumably set up in an administrative exercise and could just as easily be abandoned. Secondly, as was said by my hon. and learned Friend the Member for Kinross and West Perthshire (Mr. Fairbairn), the advisory committees are essentially of a general nature.
      We are suggesting that the court, having listened to the evidence and judged the character of the offender and his suitability for a CSO, could make a specific recommendation as to the nature of the work. I put it to the Minister that there is a difference between the court making a specific recommendation of which work should be done in an individual case and a general recommendation made through some generalised committee structure which can be abandoned at any time because it is not part of the Bill.
      Mr. Harry Ewing: The House is in danger of getting itself into some difficulty. Will the hon. Member explain what would happen under the new clause if a sheriff in a sheriff's court recommended that an offender be given some specific kind of work and the social work department said that such work was not available for the offender to do or that it was available but not suitable for the offender to do? Would that not lead to conflict rather than co-operation between the social work departments and the courts? That is the very thing that we have sought to avoid right through the experimental scheme, and we have avoided it.
      4.30 p.m.
      Mr. Fletcher: The way that the Bill is constructed is more likely to lead to conflict than are the contents of the new clause. The Minister is floating a typical red herring because it is not unusual for courts, if in doubt about the suitability of a sentence or any other consideration regarding the offender, to take time for consultation before reaching a decision. The Minister must know that, and his intervention is not relevant.
      Mr. Dewar: Does the hon. Gentleman not accept that it is clear in the new clause that even if a sheriff makes a specific request for a particular offender and the social work department decides to

      857
      ignore it, that might leave a frustrated and annoyed sheriff, but there would be nothing he could do about it? Equally, if after 100 hours of a 200-hour order had been completed, that type of work ran out, the social work department would have no option but to depart from the sheriff's suggestion.
      Mr. Fletcher: That is the position without the new clause. We are trying to give the sheriff some standing in this matter. I take the point that if the social work department ignored the sheriff's recommendation, there would be nothing under the new clause that he could do about it. However, I am sure that we all hope that relationships between the courts and the social work departments would be better than that. It is in order to try to ensure that these relationships get off to a good start that we are trying to give some right to the court in deciding the nature of the work to be done rather than having that right as the sole domain of the social work department.
      Mr. Dewar: Does the hon. Gentleman not agree that there are great disadvantages in inserting suggestion clauses in statutes? While statutes can be enforced, the new clause proposes inserting a right to suggest but not the right to enforce. That is extremely clumsy and unsatisfactory.
      Surely it would be better to follow the logic of what the hon. Gentleman has said. We hope that there will be good relationships between social work departments and sheriffs and that suggestions from the bench, as they normally are, will be given serious consideration by the social work department. We would do better to leave it on what might be called a scout's honour basis because that would make for happier relationships and a much tidier Bill.
      Mr. Fletcher: The defence of the Minister against the new clause is that advisory committees exist. However, the hon. Member for Glasgow, Garscadden (Mr. Dewar) will agree that there is no reference to these committees in the Bill.
      Mr. Dewar: That is another point.
      Mr. Fletcher: No. It is relevant to the debate. Secondly, we admit to having softened the wording of the new clause and that it is not perfect. We softened the
      858
      wording because when it was in a harder form in Committee and provided that the courts "shall have regard to", we found that it was not acceptable to the Committee. Indeed, the hon. Member for Garscadden was one of those who voted against it.
      Mr. Fairbairn: Does my hon. Friend agree that judges in the High Court may recommend a minimum period that a man convicted of murder should serve and, as far as I know, it has not been suggested by the Government that this causes friction between St. Andrew's House and the Senate of the College of Justice on the basis that a Minister might recommend that a man should be released, contrary to a judge's recommendation.
      It is one thing to say that a court should be able to recommend that a man should pick raspberries in Forfar for the whole summer, without any right to enforce that recommendation under an Act, and it is another to have a statutory right to request, which is more likely to improve the respect that the Bench and social work department have for one another than to cause aggravation.
      Mr. Fletcher: I agree entirely with what my hon. and learned Friend has said. His intervention is fundamental to the debate and the Minister should pay some attention to and make some reference to those points.
      The hon. Member for Garscadden is taking too strict a legal view of the matter. He seems to be following very much the line of the Minister. I am surprised, because the hon. Gentleman has had some time in which to disentangle himself from these doctrines. I am also surprised that he should come back to the House without having broadened his mind on some of these matters.
      Mr. Teddy Taylor: He has got worse.
      Mr. Fletcher: Having considered the case in detail, heard the evidence for and against the offender and considered the damage done by the offender, as well as the plight of the victims, the courts have a unique role and should have the right to relate the community service order to the nature of the offence. The court is in a different position from the social work department or any local authority official. The court considers the case on its merits and listens to all the evidence,

      859
      including the character of the offender. That is why we feel that the court should be in a position to make a recommendation.
      Mr. Dewar: The hon. Member showed great loyalty to the views of his hon. and learned Friend the Member for Kinross and West Perthshire (Mr. Fairbairn) who seemed to believe that the sheriff should suggest that an offender should put right the damage in the garden that he had vandalised or the house into which he had broken. In those circumstances, would it not be important to have a new clause to provide that the unfortunate person who is to be the recipient of these services should be consulted before the sheriff goes ahead with his suggestion?
      Mr. Fletcher: The new clause says:
      "In determining the nature of community service the courts may request the local authorities to relate the work to the nature of the offence."
      That is the point we are making. There is no substitute for the courts in the discharge of this function. Without the new clause, there would be nothing in the Bill to give any rights to the courts.
      Mr. Fairbairn: I am sorry to intervene again, but it is important to point out that the social worker will hear none of the evidence, will not have been present in court, will probably know nothing about the offence and will probably know only of the conviction. How can such a person be responsible for deciding the sentence?
      Mr. Fletcher: My hon. and learned Friend underlines the points that we are making. So far, they have not been answered by the Minister.
      In Committee, the Minister said:
      "It may well be that on the positive side of this argument an offender has a particular talent not related to the offence he has committed. It would be better if we utilised that talent for the benefit of the community".—[Official Report, First Scottish Standing Committee; 25th May 1978, c. 88.]
      Having heard all the evidence and considered the offender's character, the court might think that the purposes of the Bill would not be served if he were to indulge in his favourite pastime—which is what the Minister suggested.
      Mr. Harry Ewing: No. I suggested that he should use his particular talent.
      Mr. Fletcher: But that is likely to be the same as indulging in his favourite pastime. If there is any possibility of that suggestion being adopted by local authorities, the new clause is doubly relevant. There should be some reference to the nature of the offence and the court should be able to make a contribution here.
      I said in Committee that it was in the interests of the social work departments that the courts should have the right to relate CSOs to the nature of the offence. If the full responsibility for prescribing the work lies with social workers they will bear the brunt of any criticism. The responsibility should be shared by the courts and the local authorities.
      We want the Bill to have the broadest possible acceptance by the public, the police, the courts and the local authorities. This is not a party matter. I hope that the Minister will respond favourably so that the Bill may be more satisfactory to all concerned.
      Question put and negatived.

    Clause 1

      COMMUNITY SERVICE ORDERS
      Mr. Harry Ewing: I beg to move Amendment No. 1, in page 1, line 8, leave out from 'of' to 'make' in line 9 and insert
      'dealing with him in any other way,'.
      Mr. Deputy Speaker (Mr. Oscar Murton): I understand that it will be convenient to discuss at the same time the following amendments: No. 2, in page 1, line 9, after 'imprisonment', insert 'or'.
      No. 3, in page 1, line 9, leave out 'or a fine'.
      Government Amendment No. 4.
      Mr. Ewing: Amendments Nos. 1 and 4 meet a commitment that I gave in Committee in response to representations from social work departments and others about the meaning of the Bill. We were anxious to make it clear that CSOs should not be seen as an alternative to a fine but should be used where imprisonment would be imposed.
      Mr. Teddy Taylor: Does Amendment No. 1 do a great deal It simply takes out the reference to specific alternative penalties and inserts the words:
      "dealing with him in any other way".
      The options which are removed are imprisonment, detention and a fine. Is this just an amendment in wording without real effect? After all, I can think of no option but those three.
      Perhaps I have no right to ask this question, but it seems that Amendment No. 4 is putting right something which was left out. It provides that nothing shall be construed as preventing a court which makes a CSO from imposing, for instance, a disqualification. In other words, no other penalty is ruled out. Presumably, in a driving offence, a CSO and disqualification could be imposed. I know that this will puzzle the hon. Member for Glasgow, Garscadden (Mr. Dewar) but many things do these days.
      To ensure that the Bill is perfect, I wonder whether the Government would consider Clause 4, which refers to a £50 fine, to ensure that the court would not be prevented from imposing that fine and an additional fine. Might there be a case for a similar amendment to Clause 4?
      4.45 p.m.
      Mr. Dewar: These intriguing amendments deal with a matter which raised considerable discussion in Committee on Opposition attempts to remove the phrase "punishable by imprisonment" from Clause 1. I thought that that was an argument about psychology and the influence of wording in statutes on the actions of courts. That phrase is hardly a limitation of the imposition of community service orders, since any common law offence—vandalism, assault or dishonesty, for instance—is punishable by imprisonment, so CSOs would be permitted on almost anything.
      However, it was suggested that CSOs should not be the alternative to imprisonment but should be something much wider—for example, a sanction for the non-payment of a fine—or that they should be confined to first offenders whom the courts were often unlikely to sentence to imprisonment.
      Some of us thought that, although we should not exclude the possibility of a CSO being an alternative to monetary penalty, the emphasis should be on it as
      862
      the alternative to prison. Of course there should be a choice—the courts should not be fettered—but we should encourage this emphasis. The CSO should not be a way of beefing up a probation order or an alternative to a fine. By their amendment, the Government have gone some way—I hope that this is the intention—to achieve this.
      I do not want to alarm the hon. Member for Glasgow, Cathcart (Mr. Taylor) with that introduction. I agree that the amendment has no substantial practical effect, but some social work departments and some hon. Members were alarmed that the reference to a fine was an invitation to sheriffs with a different view of the Bill from that which I and the Government have.
      I should prefer Amendments Nos. 2 and 3, but I accept that they might lead to difficulties. I am prepared to stop at the halfway house suggested by the Government.
      Mr. Teddy Taylor: Can the hon. Gentleman disabuse us of the suspicion that he might be using a drafting amendment to make a Second Reading speech? What difference does the amendment make? What other options are there but imprisonment, detention or a fine? The Government appear to have replaced a reference to three options with a general phrase. What difference does that make?
      Mr. Dewar: I suggest that the hon. Gentleman is hardly in a position to tell me when I am in order or out of order. No doubt another person will be keeping an eye on that. I agree with the hon. Gentleman in this respect. I do not think that this is a matter of the psychology of the Bill. I do not think that it makes a great deal of practical difference in terms of the substantive law. I welcome it because I think that it is a shift in the right direction.
      In emphasising the removal of the specific reference to a fine, it may be removing the encouragement to sheriffs who see a community service order not as a replacement of imprisonment but as a way of strengthening probation orders, and as an alternative to a monetary penalty. I have talked to sheriffs who have told me that they see the community service order in that light. I hope that the Minister will confirm that this is his

      863
      intention in removing the phrase and putting in the omnibus words which do not refer to the specific series of alternatives. It may do something to bolster those of us who see it as an alternative to imprisonment.
      Mr. Alick Buchanan-Smith: I share the puzzlement of my hon. Friend the Member for Glasgow, Cathcart (Mr. Taylor) about the reason why the amendment has been put forward. I have no argument with the Minister to the extent that, as I said in Committee, these community service orders should be used as alternatives to imprisonment. I have therefore no argument whatsoever with the objective of the Bill or with the professed objective of the amendment.
      The hon. Member for Glasgow, Garscadden (Mr. Dewar), in reply to the intervention by my hon. Friend the Member for Cathcart, seemed to be saying that if we remove the word "fine", psychologically we take away the emphasis of the word "fine", and the sheriff will not consider a fine. But equally, if we are trying to put more emphasis on imprisonment, surely we are also taking away the emphasis on imprisonment by taking out the word "imprisonment". I find it very difficult, in drafting terms or in legal terms, to know what, if anything, is achieved by the amendment.
      If we are trying to achieve what the Minister is trying to achieve, we ought to be adopting not Amendment No. 1 but Amendments Nos. 2 and 3, in the name of the hon. Member for Edinburgh, Central (Mr. Cook), because to my mind his amendments go much more specifically towards the point here. If the use of the words is purely cosmetic, the Minister ought to leave in the words in the first part that he is seeking to take out, that is to say, the reference to imposing a sentence of imprisonment, and then go on to talk about dealing with the offender in any other way. If we want to place emphasis on imprisonment, that is the way in which to achieve it, if it is purely cosmetic. But if the Minister genuinely wants to try to make this an alternative to imprisonment, we ought to be considering the amendments of the hon. Member for Edinburgh, Central.
      864
      Frankly, in legal terms and in terms of the way in which the Bill will work, I cannot see that anything whatsoever is achieved by the change proposed in Amendment No. 1. Before I would be prepared to accept the amendment I should like the Minister to spell out in drafting terms precisely what it achieves over and above what is in the Bill as it stands. If the Minister does not intend to achieve any more and is merely introducing it as a cosmetic, I respectfully suggest that it would be better to leave the Bill as it is and not to play around with words. If he genuinely wants to change the Bill in order to give an alternative of imprisonment, I do not know whether it is the aim to try to maintain a certain amount of flexibility, but the amendment would appear to be trying to introduce an element of flexibility without producing any improvement whatsoever.
      Before accepting the amendment, therefore, I should be grateful if the Minister would spell out precisely what difference it makes in relation to the kind of sentence which the courts will pass. I cannot see what improvement it is on the Bill as it stands at the moment. My understanding of the English language may be different from that of the Minister's, but I cannot see what the amendment achieves.
      Mr. Fairbairn: I think that I can answer the question which was asked by my hon. Friend the Member for Cathcart (Mr. Taylor) and, indeed, the matter that was raised by my hon. Friend the Member for North Angus and Mearns (Mr. Buchanan-Smith). The Minister should consider my point, which is that the amendment does the reverse of what he suggested it is intended to do.
      It is very nice to know that the hon. Member for Glasgow, Garscadden (Mr. Dewar) thinks that sheriffs will think that the Bill means what he thinks it means, but as a lawyer he will know that it does not matter a monkey's tuppence what Parliament intended the Bill to mean. Once the Bill is given the Royal Assent, it means what it says and what it is capable of being read as saying.
      I hope that the Minister will consider the fact that there are other disposals available to a sheriff. There is, for instance, admonition. There is also

      865
      absolute discharge. The amendment would mean that a sheriff could impose a community service order rather than admonition and rather than an absolute discharge.
      As I understand it, that is the reverse of what is intended by the amendment. With the amendment, that is what the Bill will mean, whether the Minister likes it or not and whether that is what he intends or not. Those courses would be available to the sheriff. If the Minister does not want that to happen, he should look again at his amendment.
      Mr. Norman Buchan: I am prompted to rise because of the remarks of the hon. and learned Member for Kinross and West Perthshire (Mr. Fairbairn). Half his time in the House seems to be spent in telling us about the great value of the courts, and in emphasising that the judgment of the courts must be listened to, and so on. For the rest of the time he seems to attribute to the courts an astonishing stupidity. I am not saying in which way I would strike the balance. On this occasion I shall come into his camp on the first half of his proposition, and give the courts more credit than I have usually given them for making an intelligent approach to the problems before them.
      It seems to me that if it is in the mind of the Bench to admonish or to give an absolute discharge, the Bench will do that. The amendment is a modest proposal to try to meet some of the anxieties which were brought up in Committee. Incidentally, the only modest proposal with which the Tory Benches ever appear to agree is that of Dean Swift. I believe that the modest proposal put forward by the Minister goes some way towards meeting the anxieties expressed in Committee.
      I agree that there is no real shift in specific meaning. What it might do, however, is to give a balance of advantage. As the Bill stands, the sheriff has to consider a number of questions in deciding what he should do. First, should he punish? If he punishes, should the punishment be in the form of a fine, imprisonment, or detention? The wording suggested opens up the possibility of the use of the community service order. In other words, it provides one alternative to retributive punishment, instead of having three or four other available courses of action.
      Mr. Fairbairn: I can envisage many situations in which a sheriff would tell himself that imprisonment was not suitable, and in which a fine would be ridiculous because it could not be paid and would merely be a punishment of other members of the family. The sheriff could say to himself "Without this Act I would have to admonish, but instead of that I shall make this person do 50 hours of work". I think that that is what is more likely to happen if the amendment is passed.
      Mr. Buchan: But it is not a bad thing, surely, that the sheriff should have this alternative open to him. The hon. and learned Gentleman is suggesting that the sheriff might say "I think I should punish but I cannot see a means by which I can punish, therefore I shall admonish". That does not seem to me to be a particularly satisfactory decision for a Bench to make. If the Bench considers that an alternative of the community service order will serve a social purpose, and be helpful for the person before the Bench, it should be open to the sheriff to adopt that alternative. For all these reasons, I support the amendment.
      Mr. Harry Ewing: Perhaps I can take up the point about the case in which a sheriff was considering admonishing or giving an absolute discharge and, as an alternative, imposing a community service order. We are again wandering into the area where the belief seems to prevail that a sheriff can make an offender do community work. He cannot. The offender has to accept a community service order. What the hon. and learned Member for Kinross and West Perthshire (Mr. Fairbairn) is suggesting is that in a case where a sheriff would consider admonishing he says to the offender or the accused "I want to dispose of you by a community service order", the offender or the accused person says "No" and then suddenly finds himself in prison. I just do not believe that people with the legal knowledge of the hon. and learned Gentleman believe that that situation will prevail.
      5.0 p.m.
      Mr. Fairbairn: The sheriff will not say "Now look here Harry, my boy, I shall either admonish you or I shall give you a community service order. Which would you rather I do?" What he actually says

      867
      is "I am thinking of disposing of your case by means of a community service order. Do you accept that?" The accused person does not know whether the sheriff will send him to prison, fine him, or whatever.
      Mr. Ewing: I was depending on the hon. and learned Gentleman's well known ability for reading the mind of a sheriff. That is what the hon. and learned Gentleman told the House he was able to do when he made his contribution to the debate. What has been said in that regard just confuses a very simple issue.
      I thought that I sensed the feeling of the House to get on. I accept that I moved the amendment rather quickly. But during the debate on this aspect of the Bill in Committee, representations were made through my hon. Friend the Member for Edinburgh, Central (Mr. Cook). My hon. Friend the Member for Glasgow Garscadden (Mr. Dewar), the hon. Member for North Angus and Mearns (Mr. Buchanan-Smith) and several others made a different point during that debate. The hon. Member for North Angus and Mearns said that CSOs should be available only where imprisonment would have been imposed as an alternative. Representations were made about the concern expressed by social work departments about the emphasis in Clause 1 on fines. I said at that time that I would consider this and produce a form of words which would remove the emphasis from the word "fine" and make the Bill presentation-ally better in this respect.
      I want to make it perfectly clear that these amendments do not, in any shape or form, alter the legal situation of the Bill. Through these amendments we have really met the wishes of the social work departments which made representations to us.
      The hon. Member for Glasgow, Cathcart (Mr. Taylor) properly referred to Government Amendment No. 4. This is consequential on Government Amendment No. 1. The effect of Amendment No. 4 is to make it clear to the court that it still has the ability to suspend someone from driving or to confiscate the tools that have been used in the commission of an offence. It has the ability to do these things at the moment. We
      868
      felt that that might not be clear and that it was necessary, as a consequence of moving Amendment No. 1, to move Amendment No. 4 in order to clear up that point.
      The hon. Gentleman also referred to the question of a fine on a community service order offender. The position is that if a community service order offender breaches a community service order the court can impose a fine of up to £50 if the community service order is to continue. But if the CSO is not to continue, the offender will be disposed of by the court in a way in which the court feels fit. If a breach was committed, and the service order was to continue, the court would impose a fine of up to £50. I hope that I have made that clear.
      For the benefit of the House I should say something about the two amendments of my hon. Friend the Member for Edinburgh, Central. They are not acceptable to the Government because they have the rather drastic effect of giving the courts the ability to impose both a fine and a community service order, in other words, to impose up to 240 hours of community work and a fine as well. In our view, that is not acceptable. I am not saying that that is what my hon. Friend sought to achieve. What I am saying is that if the House were to accept his amendments that would be their effect. I am sure that the House does not want that.
      Mr. Teddy Taylor: The Minister has rightly pointed out that the main reason for Amendment No. 4 was to make it clear that if a CSO were imposed it would not prevent the courts, for example, from also disqualifying someone from driving. As for a fine of up to £50 for breaching a CSO, it would seem to me from a reading of Clause 4 that the intention is that this £50 fine is the penalty for breaching the order and that the court can then go on to deal with the original penalty as it would have been dealt with but for the CSO.
      Perhaps between now and consideration in another place the Minister will see whether the same problem has arisen in Clause 4 and in Clause 1, that by imposing a £50 fine the court may be precluded from going on to deal with the original penalty with an additional fine. Will he look at Clause 4 in exactly the same way as he has looked at Clause 1,

      869
      in order to make sure that by imposing a CSO the court is not prevented from doing other things? Perhaps he will even drop me a note about this, or sort it out before the matter is considered in another place.
      Mr. Ewing: I can give an undertaking that I shall certainly look at this. If there is a need to sort the matter out in another place, we shall certainly be very happy to do so.
      Amendment agreed to.
      Amendment made: No. 4, in page 2, line 34 at end insert:
      '(7) Nothing in subsection (1) above shall be construed as preventing a court which makes a community service order in respect of any offence from—

      (a) imposing any disqualification on the offender;

      (b) making an order for forfeiture in respect of the offence;

      (c) ordering the offender to find caution for good behaviour.'.—[Mr. Harry Ewing.]

      Motion made, and Question, That the Bill be now read the Thrd time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.
      Bill accordingly read the Third time and passed.

TUVALU BILL [Lords]
Order for Second Reading read.
The Parliamentary Secretary to the Treasury (Mr. Michael Cocks): I have it Command from the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Tuvalu Bill, has consented to place Her prerogative and interest, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
5.7 p.m.
The Under-Secretary of State for Foreign and Commonwealth Affairs (Mr. Evan Luard): I beg to move, That the Bill be now read a Second time.
It is only two or three weeks since the House debated the independence Bill for the Solomon Islands. That is a very much larger territory than that with which we are concerned today. The Solomon Islands is a country with a population of about 200,000. On that Bill we encountered considerable complexities in the nationality provisions which aroused a good deal of discussion and debate.
Today we are debating the independence of a very small territory indeed, whose total land area is little more than 10 square miles. It has a very small population, of only about 9,000 people. I am glad to say that on this occasion we shall not encounter the difficulties and complexities with regard to nationality provisions which gave rise to so much debate on the previous occasion.
Before describing the contents of the Bill, I should like to say something about the history of Tuvalu and the developments which led to the introduction of the Bill. Most hon. Members may find the name "Tuvalu" somewhat novel and confusing—they know this territory much better by its old title of the Ellice Islands. Most of us are very familiar with the name "Gilbert and Ellice Islands".
Tuvalu itself comprises only nine coral atolls lying between Fiji and the Gilbert Islands in the South-West Pacific. The total land area is only about 10 square miles in a chain stretching along about 360 miles of sea. The people are mostly Polynesians. Most of the territory is covered by coconut palms, and it enjoys a tropical climate.

871
The first European settlers in Tuvalu were missionaries who came from the London Missionary Society and arrived in about 1865. They installed Samoan pastors on the islands and the islanders were quick to embrace the new faith. Since then, the Protestant Church has had a strong and continuing influence on life there.
In 1877, we established the West Pacific High Commission to protect the islanders from the practice, which at that time was very common in the area, of what was known as "blackbirding"—it was labour recruitment—and we were able to control and to a large extent to put a stop to that activity.
In 1892, the Ellice Islands became a British protectorate, and in 1916 they were joined with the Gilbert Islands to form the Gilbert and Ellice Islands colony.
During the Japanese occupation of the Gilbert Islands in the Second World War, many Tuvaluans worked to help the Allied forces and I am glad to say, showed admirable courage and loyalty in that cause.
The Gilbert Islanders are Micronesian and differ culturally, socially and linguistically from the Polynesian inhabitants of the Ellice Islands. The Ellice Islands are also geographically distinct from the Gilbert Islands. It was as a result of these differences that, during the early 1970s, the Ellice Islanders expressed the desire to separate from the Gilberts and to make their own way to independence. This was not a matter of controversy with the Gilbert Islanders. They did not object to separation and, in 1974, a referendum was held in the Ellice Islands which was observed by the United Nations. An overwhelming majority voted in favour of separation.
In 1975, the Ellice Islands were formally established as a separate colony, with the traditional name of Tuvalu. Independence day is planned for 1st October of this year, which is the third anniversary of separation.
In February of this year, a constitutional conference took place in London under the chairmanship of my right hon. and noble Friend the Minister of State, Lord Goronwy Roberts. It was agreed that, subject to the approval of Parlia-
872
ment, Tuvalu should become independent as a constitutional monarchy under Her Majesty in October 1978. The report of the conference was published as a White Paper and presented to Parliament on 31st March of this year.
This Bill makes provision for Tuvalu to attain independence and for various connected matters. Clause 1 provides for the independence of Tuvalu within Her Majesty's dominions as from 1st October 1978. Schedule 1 deals with the consequential enlargement of the powers of the Tuvalu legislature.
Clauses 2 and 3 deal with nationality. There are similar to the nationality provisions usually found in independence Acts and, as I mentioned earlier, they contain none of the unusual features included in the Solomon Islands Bill, which caused a certain amount of controversy in this House when we discussed it. Given the concern which was expressed about that Bill, I should make it clear that no resident of Tuvalu will be left stateless as a result of this Bill, and immigration rights will be unchanged.
Clause 4 and Schedule 2 deal with consequential modifications of other enactments. Clauses 5 and 6 deal with interpretation and citation.
I turn to matters which are not covered by the Bill but about which the House may wish to be informed. The independence constitution will provide in detail for the protection of the fundamental rights and freedoms of the individual, about which we in this House have always been so concerned. The constitution will also provide for a legislature of 12 Members elected by universal suffrage, for a Cabinet responsible to the legislature, and for an independent judiciary and public service. We are satisfied that the traditional concern for human rights, which I am glad to say has been shown on these islands, will be maintained there in the future when the country moves to independence.
Mr. John Lee: This is following the usual practice, as we know, but can my hon. Friend say when the Order in Council encapsulating the constitution is likely to be available for perusal? One assumes that the contents of this will deal with entrenched clauses dealing with the matters to which my hon. Friend has referred.
Mr. Luard: I recognise that the House has an interest in such matters. That is why I am saying something about the terms of the constitution. But it is traditional that the Order in Council is not published until after the debate on the independence Bill itself. I can say that it will be published fairly shortly, as was the case with the Solomon Islands Bill.
Right hon. and hon. Members will be concerned about the future economic viability of this very small territory, with its very small population. Inevitably, the economy and development of Tuvalu will depend for some time on outside donors of aid. I am glad to say that we are by far the biggest contributors to development and will remain so for some time. We shall be giving about £6 million over the next few years for the development of these islands, with their population of 8,000 or 9,000. In addition, Australia and New Zealand will contribute to development, as will the European Development Fund, as donors of capital aid. The United Nations Development Programme will provide assistance, through which the United Nations Specialised Agencies will help. The Commonwealth Fund for Technical Co-operation, the South Pacific Commission and the United States of America will also provide technical co-operation funds.
Mr. Christopher Price: Is it the intention that Tuvalu shall accede to the Lomé Convention?
Mr. Luard: My hon. Friend anticipated my next sentence. I was about to say that Tuvalu is also expected to accede to the Lomé Convention.
For the first two years after separation from the Gilbert Islands, much of our own aid programme was directed towards providing the necessary infrastructure for good government and creating the administrative backbone for the colony. This work has included the construction of Government buildings, hospitals, schools, harbour works and protection against further devastation by hurricanes. Much of this work has now been completed, and a start has been made on development aid projects which are intended to widen the revenue earning base of Tuvalu. I am sure that we all agree that the ultimate objective must be not to go on providing aid indefinitely but to put Tuvalu in a
874
position in which she can provide her own revenue funds for the future.
A special development fund of £2·5 million with no time limit is included in the financial settlement. This fund will be used for projects of a developmental nature agreed between the British and Tuvalu Governments. We shall also be providing budgetary aid, ordinary capital development aid on grant terms and technical co-operation until 1980. The terms for this have already been agreed.
Mr. Paul Dean: I am not altogether clear what the relationship would be between the special development fund and what I think the Minister called ordinary capital development of other types. What is the distinction between the two? I think that the special development fund is a somewhat new concept. I am not clear what the division of effort is between that fund, the capital development aid and the technical cooperation.
Mr. Luard: The capital development fund will be going for projects which have already been agreed. The special development fund is for projects agreed between the British Government and the Tuvalu Government over the next few years for special programmes which we think will be of assistance in the way that I described.
I am sure that everyone in this House will want to join me in wishing this territory the best for the future. It is probable that there has never been a territory so small in resources or in population for which we have seen an independence Bill through this House. Most of us will feel nothing but admiration for the courage of the population and their Government in embarking on the perilous road to independence with so few resources and so small a population.
I hope that the House will join me in congratulating the people and Government of Tuvalu, especially their Chief Minister, on the great progress that they have made in the short time since they were separated from the Gilbert Islands and on the statesmanlike way in which they have worked to ensure a successful and peaceful future in an independent Tuvalu.
I am confident that our long association with that country and the friendship

875
between us will continue for many years. Tuvalu has expressed an intention of joining the Commonwealth, and I am pleased that it will be as fellow members of the Commonwealth that we have the prospect of continuing the close ties that exist between us.
5.20 p.m.
Mr. William Shelton: We join with the Under-Secretary in offering good wishes and congratulations to the people of Tuvalu. I would like to refer to the remarks of Lord Elton, on 9th May, in another place, in which he said that it was impossible not to admire the courage of such a small people setting out on a course of independence in this very hazardous world.
Tuvalu has a population of between 9,000 and 10,000 of whom 2,000 live abroad. Therefore, the numbers on the nine islands total only 7,000 or 8,000. When one thinks that the nearest capital to Funafuti, the capital of Tuvalu, is Suva, which is 650 miles away, and that Sydney is more than 2,500 miles away, one has some idea of the vast spaces in that part of the world and the hazards encountered by those who cross them.
I also welcome the decision of the people of Tuvalu who wish the Queen to remain the Head of their country. The Chief Minister, the honourable Toalipi Lauti, said that it was the unanimous wish of his people that that should be so. Also, we welcome the decision of the Tuvalu people to remain in the Commonwealth.
I believe that we shall see increasingly strong regional groupings of the Commonwealth throughout the various parts of the world. This is something that will gain in force and importance and to which we must give a welcome. At the meeting of the ASEAN and Commonwealth Prime Ministers in Australia in February there was a move in that direction. I would regret it very much if this regional grouping in any way lessened the links that this country has with our friends in the Commonwealth. I hope that these Commonwealth connections will continue the strength of our links with the people of Tuvalu.
There are four criteria by which the independence of a country should be considered when that country wishes to sever its links with us. First, let the
876
people of that country want independence themselves; secondly, we should at least leave as strong a bulwark for justice and liberty as we can in this uncertain world; thirdly, the country that is obtaining independence should have sufficient economic strength, or the prospect of it, to maintain independence; fourthly, the severance should be a just and reasonable one, accepted by both parties with good will and amity.
For the first criterion, there is no doubt that this move represents the wishes of the people of Tuvalu. The Chief Minister said in the constitutional conference that independence was the wish of the people. After 86 years of "togetherness" it is with some sadness that we accept that the people of Tuvalu want their independence. We would never wish to stand in the way of the united desire of the people of any country to go their own way, and when that moment comes on 1st October we shall wish Tuvalu the very best of fortune.
The second criterion is that of justice and liberty. As the Under-Secretary has said, in the independence constitution we have provision in detail for the protection of fundamental rights and freedoms of the individual. The only sadness we have seen in other parts of the world is that however entrenched these clauses may be they can always be overthrown by the leaders of people who do not themselves believe in justice and liberty. The history of this century has shown that it is impossible to entrench in a constitution or to write into a paper enduring liberty. It must rest within the hearts and minds of those who live in the country and especially those who control their destiny.
I am sure that justice and liberty will be the future history of the people of Tuvalu, especially as I understand that the Church in that country is deeply rooted, and the Christian tradition is strongly represented. Therefore there is a strong hope and prospect that justice and liberty will remain there.
I turn to the third criterion of the economic situation, which, in Tuvalu is more difficult. It calls for one or two questions to the Under-Secretary. I read with special interest the speech at the constitutional conference by Dr. Tomasi Puapua. He represents the unofficial opposition. It seemed that the conference

877
was a great success, except for the non-arrival of the Minister of State, Lord Goronwy-Roberts, who was snowbound. It must have been very strange for the delegates from Tuvalu to find that the Minister was snowbound.
Dr. Tomasi Puapua had some reservations. He said that the Tuvalu people were fully aware that they had been neglected by their old colonial masters—ourselves. He said that the future position of Tuvalu in economic terms could be decribed only as grim. He finished his speech by saying that the delegates had come to the conference carrying empty brief cases, but they hoped that they would leave with brief cases filled with pound notes to take back home. This slight sense of bitterness springs partly from the arrangements that were made when the split between the Gilbert and Ellice islands was arranged by the British Government.
The difficulties involved in these arrangements were touched upon in the speech by the Church representative, the Reverend losia Taomia, who said that the people of Tuvalu had come out of the previous Gilbert and Ellice Islands colony empty-handed and with a sense of injustice, loss and disappointment. He referred specifically to two reasons why they felt that sense of injustice.
The first reason was to do with the Gilbert and Ellice Islands reserve fund. This is a fund of about 30 million to 40 million Australian dollars, which was built on revenues from, phosphates from the well-known Ocean Islands and the even better-known Banabans. This fund was built up jointly by the Gilbert and Ellice Islands, but on the occasion of the split the fund remained with the Gilbert Islands. None of it was passed to the Ellice Islands. It was asked why no share of this fund had gone to the people of Tuvalu.
The second reason, which seemed to have been the cause of some bitterness, was that the previous colony of the Gilbert and Ellice Islands administered the Phoenix and Line Islands. On independence the people of Tuvalu have asked why they have had no share in continuing the administration of these islands. The nine islands of Tuvalu represent only 10 square miles. The people are short of land, but they intend to prosper and develop. They believe that some share
878
in the Phoenix and Line Islands would have been of value to them. From what they have said, it would seem that they have some reason for taking that view. I read the reply made by the Minister at the conference, which was brief and perhaps somewhat inadequate.
I think there is some truth in the fact that in the 86 years of colonial rule the Gilbert Islands came out of matters more favourably than did the Ellice Islands. It was only in 1975 that Tuvalu was given its own secondary school and a hospital large enough to deal with emergencies in the nine islands.
We are discussing the future of a small chain of islands far away from us—islands for whom we still have responsibility and whose inhabitants still have an apparent sense of injustice. Their economy is based on the export of copra and on remittances sent home by the 2,000 or so of its citizens who work mainly as very good sailors in various parts of the world. The postage stamps from the area, which I remember very well from my stamp collecting days, bring in considerable revenue to the islands. There is also the fishing industry, which is of great importance to the islanders. The islanders, however brave their words, are in a vulnerable position. They have a problem with fishing limits, but it is by no means as difficult as our problem. They wish to have a limit of 200 miles, and I trust that they will effect it more easily than we have tried to effect our limit.
There is a slight area of discord, which I hope has been met by the aid described by the Minister today. That aid amounts to £6 million or £7 million, including a figure of £2½ million from the Special Development Fund, and budgetary and development aid, which will last until 1980. A meeting is to be held in 1980 to see what, if any, further aid is required. However, it must be expected that on independence the islanders can look to wider sources of aid than a colony can be expected to look to. They can join the Lomé Convention. Since the Japanese are interested in fishing, we must remember that the waters round Tuvalu provide excellent fishing grounds. Therefore, perhaps the islanders will be able to come to an advantageous arrangement with their neighbours in that respect.

879
I hope that the Minister will be able to reassure the House that any bitterness or sense of injustice has diminished and that the conference ended on a note of optimism and reassurance. I hope that the representatives of Tuvalu feel that, however history may have served them, they have been fairly and properly treated and are satisfied within reasonable terms that the aid provisions are adequate and that they can have confidence for the future. The citizenship arrangements outlined by the Minister appear to be very satisfactory. The islanders will become citizens by law on 1st October, the day of independence. We wish them well.
We wish god-speed to the citizens of Tuvalu and to their Government as they become a new and independent country. We hope that they will not sever their links with this country, but that independence will serve to strengthen the ties and friendship between our countries, within the Commonwealth, and with Her Majesty the Queen as our monarch.
5.34 p.m.
Mr. Jeremy Thorpe: I wish to intervene briefly on behalf of my Liberal colleagues to express our good wishes and support for this Bill as the people of Tuvalu advance towards the courageous and daunting prospect of nationhood.
There was some difference of opinion in another place as to the exact population of Tuvalu. Clearly it is under 10,000. When one considers that Members of this House represent anything from 50,000 to 70,000 electors, and constituencies even beyond those figures, one is staggered by the fact that here is a population of only 10,000 in an area of 10 square miles who now join the comity of nations. That must be a courageous and daunting step.
Tuvalu has one of the smallest populations in the world. There are one or two other nations that are of equivalent size, but I shall not go into them now because if I did I should leave out some and include others incorrectly. Tuvalu will be dependent on the good will of the variety of organisations to which the Minister referred. Commonwealth technical assistance will be vital. Therefore, it is some consolation to us to know that it will remain members of the Common-
880
wealth. Capital aid funds in the form of ACP through the Lomé Convention will again be a manifestation of the interest of the European Community towards the Third World.
The friendship of Australia and New Zealand will be vital to Tuvalu, as will that of Fiji, on which she will rely for some of her aid staging facilities. The United Nations will need to devote to the islanders the attentions of the Specialised Agencies, particularly WHO, FAO and the Special Fund. We do not know whether the islanders of Tuvalu will become full or associate members of the United Nations; that is a matter for them. I hope that they will not trouble to go to the expense of becoming full members and that they will not look on such membership as an automatic virility symbol. The United Nations will face problems if areas with small populations are to be burdened with the expense and political involvement of full membership. I hope that they will not feel in any way second-class citizens of the world if they do not opt for full membership. They might bear in mind the fact that Switzerland has not become a full member, though for different reasons.
We have been associated with the islanders of Tuvalu for nearly 100 years and that association will continue, but in a new form. Perhaps the Minister will be able to tell the House whether there has been an approach in respect of defence treaties or arrangements. The hon. Member for Streatham (Mr. Shelton) mentioned the subject of fishing and the interest of Japan in the area. We all know that territorial waters can sometimes turn into troubled waters. Sometimes it is a good thing for a small territory to feel that in times of trouble it has some backing from another nation. Various defence arrangements already exist in that part of the world, there are the various economic groupings, and it will be for the Government of Tuvalu to make approaches. I merely wish to be told whether we have been asked for any form of defence guarantees, or whether such requests have been made of Australia and New Zealand.
I welcome the fact that in 1980 there is to be a review of the British aid programme. I hope that we shall continue to give as generous help as we can then

881
afford to what will still be a small population with a very low per capita income. This appears to be pre-eminently a case in which we should be able to call in our Commonwealth and European partners to help.
I warmly support the Bill and wish the people of Tuvalu success and good fortune in their independence. They have the friendship of this House, of this country and, I hope, of many other nations, too.
5.40 p.m.
Mr. Christopher Price: I, shortly, add my welcome to the Bill and congratulations to the people of Tuvalu on joining the independent countries of the world. I do so as Secretary of the Anglo-South Pacific Group of the Commonwealth Parliament Association and as someone who comes from a long line of London Mission Society missionaries. My grandmother was born on a Polynesian island not within Bali but not very far away.
I echo everything that has been said about the importance of the Church at this stage in the development of Tuvalu. Almost every politician on the islands at present was trained as an LMS missionary. The small Pacific countries are training grounds for the Church, teaching, politics and everything else that is essential for a country's administration. Although we have rather less to be proud of in some ways in our treatment of the people of the Pacific over the past 100 years, in that respect we have a certain amount of which we can be proud.
I echo the remarks that have been made about the problems that Tuvalu will face with a population of only about 8,000. It is worth sounding a word of warning. The past few independence treaties—certainly for the Solomon Islands and the Gilbert Islands, the latter of which will be coming before us—have come not so much from passionate campaigning in the colonies for immediate independence but from a passionate desire in the Foreign Office to complete the proces of decolonisation. We may argue which is the greatest force, but both forces were present on this occasion.
There may be a tendency to sweep countries towards independence without thinking of the problems that will be
882
faced in the world by a country consisting of eight tiny islands with a population of only 8,000. I am glad that Tuvalu will joint the Lomé Convention. When I had discussions with the representatives of Tuvalu when they came to this country they expressed doubts about joining the convention, for the same reasons that the right hon. Member for Devon, North (Mr. Thorpe) had doubts about Tuvalu's joining the United Nations. Those in Tuvalu are anxious not to involve themselves in membership of international organisations that presents them with unjustifiable expense.
I hope that I shall have an assurance from my hon. Friend the Under-Secretary of State that the Foreign Office will consider arrangements for new accessions to the Lomé Convention by small countries to ensure that that does not involve them in unnecessary expense and does bring direct benefit to them.
Tuvalu will have a problem with diplomatic representation. I understand that it will be heavily reliant on Fiji to help it in representation throughout the world.
When Prime Minister Kirk became Prime Minister of New Zealand, some years ago, genuine efforts were made to try to establish a constitutional structure so that the small islands of the Pacific would not, if they did not wish to, have to go for total independence but could join some sort of organisation. It is sad that since the new regime in New Zealand there is not nearly so much thrust to try to organise something of that sort. In my view, such a move will be essential over the next 10–20 years.
Mention has been made of a 200-mile fishing limit. Japan has already signed an agreement with the Solomon Islands for fishing. It may move to try to make some arrangements with Tuvalu. If it does, the people of Tuvalu will need some negotiating strength vis-a-vis the great strength of Japan.
Tuvalu has a small land area but it will have a large sea area if it goes to a 200-mile limit or beyond. My hon. Friend the Under-Secretary of State knows—he is the House's greatest expert on the sea bed—that as we run out of mineral resources on land the countries that have control over mineral resources under the sea will become enormously

883
more important, strategically. Therefore, they will become of enormously greater interest to the great Powers that want to get their hands on some of the resources.
If Tuvalu suddenly became important in any negotiations with any of the great Powers, it would not be in a strong position. That is why it is essential to Tuvalu, the Solomon Islands and, when we come to them, the Gilbert Islands—it is to be hoped that when the French get round to stopping exploding atomic bombs in the Pacific this will apply to French Polynesia and New Caledonia—that when they reach independence they join the already independent countries, such as Fiji, Samoa and Tonga, and enter some sort of federation. If that is done, such countries will be in a position to get together to stand up against those from the rest of the world who want to make arrangements with them when the sea bed attains greater strategic importance. In that way they will be able to ensure that the resources are exploited properly and not in a way that does not assist them, causes pollution, or has a number of other bad side-effects.
I know that the United Nations, the Commonwealth and other agencies will be of assistance to the Government of Tuvalu in that respect, but in welcoming Tuvalu to its independence I very much hope that the British Government will do all in their power to help Tuvalu get together with its neighbours. I am sure that something of that sort will be necessary.
Finally, we need not have any fears about human rights and the people of Tuvalu. If anything, they have a few things to teach us about such matters. The Polynesians are one of the five original races in the world. Their record on human rights is a million times better than the record of Europeans. We need have no worry on that score, and there is no need to preach to them. It remains to welcome the people of Tuvalu to their independence and to give them our good wishes for their independence.
5.47 p.m.
Mr. Andrew Welsh: I welcome the Bill and congratulate the people of Tuvalu on gaining their independence from the United Kingdom. The Scottish National Party appreciates their
884
desire to run their own affairs in their own way. We wish them well in their attempt to seek democratic self-government.
I hope that the people of Tuvalu will share my sense of irony and that of other Scots when we hear hon. Members in this place advocating so strongly self-government and the benefits of self-determination and producing a short Bill—it consists of only five pages—granting independent government to other people in the world. The five pages of the Bill show how easily independent government may be granted. I hope that hon. Members will take note of that.
We find that the Bill refers to "independence within the Commonwealth". That is exactly the SNP's policy for Scotland. Every membership card shows that. The remarkable agreement in principle on SNP policy is surely too good an occasion to miss.
Mr. Stanley Newens: I am following the hon. Gentleman's argument with great care. Do I understand that in expressing enthusiasm for the Bill he is also expressing enthusiasm for the independence of all islands? Is he, therefore, advocating such independence for the Shetlands?
Mr. Welsh: The hon. Gentleman's concern over the Shetlands is of recent origin. I am sure that it blinds his concern for the whole of Scotland. Our policy on the Shetlands is straightforward, and I recommend that he reads it. We believe in the maximum reasonable devolution of powers.
I was tempted to produce an amendment to the Bill to delete "Tuvalu" and insert "Scotland". Let me assure the House that I did not table this amendment because I do not want to spoil the independence celebrations on Tuvalu.
I was tempted to ascertain how serious the English are about giving independence to Tuvalu and to demonstrate to hon. Members now present how easy it would be to give similar independence to Scotland.
In passing, I note the new Tory philosophy—
Mr. R. A. McCrindle: Is there not a vital difference between giving independence to the

885
people of Tuvalu because they want it and giving it to the people of Scotland, who we know do not?
Mr. Welsh: That is an interesting point. I was about to note the new Conservative philosophy in regard to this matter. The Conservative Opposition's policy on Tuvalu, which we have heard enunciated today, is abundantly clearer than the shambles that they have created on devolution for Scotland, and thank goodness for that. Of the four criteria, I hope that Tory Opposition Members will do everything they can to honour the fourth when the time comes.
The people of Tuvalu may be lucky in that they have not discovered oil off their shores. Perhaps they are lucky that their geography makes them more distant from London than is Scotland. It is a surprise that Tuvalu did not have a referendum on this issue with a 40 per cent. blocking amendment. It is probably just as well that they escaped the attention of the hon. Member for Islington, South and Finsbury (Mr. Cunningham) in their 1974 referendum.
Indeed, where is the inevitable and—I nearly said "iniquitous"—ubiquitous hon. Member for West Lothian (Mr. Dalyell)? I am surprised that he has not scanned every word, comma and dot in the Bill in order to preserve the essential unity of the British colonies as he likes to maintain every possible vestige and ounce of London rule wherever it exists throughout the world. The hon. Gentleman should be here to attack Tuvalu's separatism, as is his wont elsewhere.
I find it ironic that Papua New Guinea, the Solomon Islands, Belize and other parts of the British Empire—good luck to them—should be given the blessing of the House on their complete independence, with no caveats, whereas month after month has been spent in this House and in another place haggling over every minor detail of even the most minimal of devolution powers to the ancient nation of Scotland. But, in looking at and approving this Bill, I leave that to the consciences of hon. Members. I hope that those who have spoken in support of the Bill will remember their words when they consider both devolution and a similar Scottish independence Bill when it arrives here.
This is, however, Tuvalu's day. I wish these nine islands and their almost
886
10,000 population well in their move towards independence among the States of the world. I welcome their independent status within the Commonwealth of nations, which Scotland will also one day soon achieve.
5.53 p.m.
Mr. John Lee: The hon. Member for South Angus (Mr. Welsh) has had his fun, and I think that we have all enjoyed it. When my hon. Friend the Member for Harlow (Mr. Newens) intervened, he might have mentioned future independence for St. Kilda as well. One never knows where all this will end.
I follow the argument of the hon. Member for South Angus in perhaps being a little more controversial than some hon. Members who have spoken in the debate, for reasons which I shall make clear later. Before doing so, I want to say what I suppose almost all hon. Members should say on these occasions. I express a welcome and a word of good will for the country that is to become independent.
It is strange how, over the years, these occasions should have become numerous, but progressively less and less controversial. After the rather bitter debates over India immediately after the war, the tempo has diminished until now, unfortunately, the number of hon. Members taking part is small. [HON. MEMBERS: "Rhodesia."] I hear the word "Rhodesia". That is a very special case, as we know.
There is an irony about the Bill which the hon. Member for South Angus did not notice. The Ellice Islands were separated and given a new name and provided with legal authority to stand on their own, but a somewhat similar course of action has been denied to Ocean Island. I do not wish to compare unlike with unlike, but I think that I am entitled to make the point that if Tuvalu is very small, Nauru is smaller still, but not notably larger or smaller than Ocean Island was before it was devastated by the phosphate exploiters. Indeed, Nauru and Ocean Island go very much hand in hand. They were both exploited by the same organisation—the British Phosphate Commission. They are both small and compact islands. Whereas Nauru has been granted independence by the Australians, the future of Ocean Island remains in doubt.

887
I am using this debate, among other things, to give notice to the Government that I find it significant—I hope that I shall derive some satisfaction from this fact—that, whereas it was thought that there were to be three Bills providing for independence in the Pacific in this Session, there appear to be only two: the Solomon Islands Bill, with which we have already dealt, and the Tuvalu Bill with which we are now dealing. The third Bill was to relate to the Gilbert Islands.
I have a feeling that the absence of the Gilbert Islands from the agenda may not be unconnected with the controversy surrounding the future of Ocean Island. I give notice to the Government that if a Gilbert Islands independence Bill should materialise while I am still a Member of the House, it will be subject to a large number of amendments. Indeed, I can speak confidently on behalf of the hon. Member for Essex, South-East (Sir B. Braine), who takes the same view as I do and is a more adept filibusterer than I am. I am sure that he, too, will put down a large number of amendments. If that occurs, I anticipate that that Bill will go through the kind of treatment that another place is dealing out to the Scotland Bill now.
The hon. Member for South Angus shakes his head sadly. He and I may have much the same views about the right of the other place to legislate. It is an interesting precedent. Constitutional Bills, by convention, have to be taken on the Floor of the House, whether they are highly controversial, like the Scotland Bill, or unexceptionable, like this Bill. Therefore, Government managers may look forward to a bit of trouble if there should be a Gilbert Islands Bill and if justice is not done for Ocean Island's rightful owners. We know that there has been a financial settlement, but their request, that Ocean Island should go into associate status with Fiji, where the Banabans have been living in exile for the last 30 years, still has to be resolved.
Having said that, I shall return to perhaps less controversial matters.
Mr. Anthony Kershaw: Surely the case of Ocean Island and the Banabans is different from what we are discussing now. Ocean Island could not pos-
888
sibly support more than a few hundred people. The mass of the Banabans live on Fiji territory. It would be absurd to imagine that Ocean Island could be a constitutional entity in itself.
Mr. Deputy Speaker (Mr. Oscar Murton): Order. This measure relates to the independence of Tuvalu, and we should remain there.
Mr. Lee: I shall walk circumspectly in view of your ruling, Mr. Deputy Speaker. However, I think that it is in order for me to say that the constituted colony of the Gilbert and Ellice Islands, from which Tuvalu was hived off and is now to be made a fully independent country, was an arbitrary creation. Not only were the Ellice Islands arbitrarily lumped in with the Gilbert Islands; Ocean Island, which had existed separately for a considerable time, was lumped in in the same arbitrary fashion at the same time in the middle of the First World War. I think that that to that extent I can answer the hon. Member for Stroud (Mr. Kershaw) without transgressing the Chair. There was a time when it would have been viable. As it is, the proper justice of the case can be met now only by Ocean Island going into Fiji.
I come back to the provisions of the Bill. I intervened earlier to ask the Minister about the constitutional arrangements in the Order in Council under the provisions of the British Settlements Act. Of course, that cannot be produced until there is the necessary legal authority for its provision. We would like to know—I echo the remarks of the hon. Member for Streatham (Mr. Shelton), who made some observations about civil liberties, from which I am sure none of us dissent—what kind of entrenched clauses are likely to be found.
The hon. Member for Streatham was right to say that, sadly, one constitution after another in the Commonwealth has been ripped up, sometimes only shortly after being produced. The record must be held by Zanzibar. It became independent one month, there was a revolution a month later, and its constitution was thrown out of the window. There were endemic weaknesses in Zanzibar. As a sultanate it was an archaic nonsense. One cannot put too much faith in constitutional provisions, although there is a duty to provide them.

889
Are there to be entrenched clauses to deal with appointments to the judiciary and a public service commission to deal with Civil Service appointments? I assume that the Judicial Committee of the Privy Council will remain the final court of appeal for certain matters. That has been the case in a number of territories, including many in the new Commonwealth, such as Fiji. A colonial governor once said somewhat acidly that he was vexed by the unhelpful decisions of distant judges, but if this were to be the case Tuvalu would be relieved of the responsibility and expense of having its own appellate court.
We are not faced with the same problem of nationality as we were when dealing with the Solomon Islands and which troubled some of my hon. Friends, including my hon. Friend the Member for Lewisham, West (Mr. Price). It would be helpful to know whether there will be such provisions.
The people of Tuvalu have undertaken a difficult task by deciding to go it alone as an independent nation. I wish them all the luck in the world. Unlike Belize, they do not face a direct military threat. I suppose that that is the only reason why Belize is not yet an independent territory. The fear is that if we walk out somebody else, such as the Guatemalans, will walk in. But Tuvalu is small and economically vulnerable. There must be a risk of a measure of undesirable economic penetration. I hope that we shall be generous with them for a long time.
One cannot talk in terms of an open-ended commitment. No Government could do that in a technical sense because no Parliament can bind its successor. It would be unrealistic and basically undesirable for an open-ended commitment of an indefinite character to be made The recipient might not want such a commitment. But I should like more detail about what economic development is envisaged.
These islands are too far from any main centre of population to be a tourist attraction and for tourism to be a fruitful source of income. Although they are beautiful islands, they are not as beautiful as Samoa, which I had the pleasure of visiting three years ago. These islands are a little further off the beaten track. They do not have the urban amenities
890
required by the rich tourists who are the only tourists who are likely to go there for some time.
What my hon. Friend the Member for Lewisham, West said about undersea resources is only too true. If resources were to be discovered the situation there might be transformed overnight. But it might also subject the people of Tuvalu to pressures and temptations and the possibility of improper interference from other sources. What type of defence assistance is to be provided? I regard most of British defence policy as singularly unrealistic and expensive but I have never subscribed to the view that there should be no such thing as defence. Perhaps in this context we can, for once, do something useful without it being too expensive.
I echo what my hon. Friend the Member for Lewisham, West said about overseas representation. I assume that we shall continue to bear the diplomatic burden on Tuvalu's behalf for many purposes. I cannot believe that they will wish to beggar themselves by having diplomatic representations all over the world merely for prestige.
When one looks at progress towards independence it is strange to find that this territory has been under British administration for longer than many of the mainland territories in Africa, and yet those territories received independence some time ago. One of the principal reasons was not a reluctance on our part to grant independence but the difficulty of finding a way to make the islands economically viable.
Sir Raymond Gower: We are dealing with territories which a few years ago we never contemplated would want independence or separatism because they were so small. Will it not be a real problem to make reasonable provision not only for defence but for education and health care in contemporary terms? It is a terrifying thought that the Bill states:
"the United Kingdom shall have no responsibility for the government of Tuvalu."
It might as well say "no responsibility for the people". That is terrifying in a territory as small as this.
Mr. Lee: I understand that. The hon. Member has made a point of substance.
I hope that the idea of some kind of West Pacific federation will be promoted

891
in the next few years. Federations have fallen into disrepute—and for good reason. Two or three have been tried since the war. With the exception of the West Indies, which was a good idea—I sadly regret that it foundered—some are distinctly suspect in character. I am thinking of the South Arabian Federation and the Federation of South Rhodesia and Nyasaland. One would not regard them as happy precedents.
Such a federation would enable burdens to be shared among a number of territories which are small in potential and likely to remain so. If several East African mainland territories can have the East African Common Services Commission, which Tanzania, Kenya and, before the recent unspeakable events, Uganda joined, something similar should be possible among the Gilberts, the Solomons, Tuvalu and Fiji.
My hon. Friend the Member for Lewisham, West referred to the Western Pacific High Commission. Although he might be technically correct that this concept originated in the nineteenth century, it was not until 1952 that the Western Pacific High Commission per se was separated from the governorship of Fiji, and then it lasted only for about 20 years. They incorporated the Gilbert and Ellice Islands, the Solomons, the Phoenix Islands and one or two other territories. When my hon. Friend the Minister replies to the debate I hope that he will say a few words by way of encouragement for the concept of a federation.
There is a University of the Pacific, which is another example of shared amenities among a number of different territories. It must be a daunting task to administer a university which has a catchment area larger than the areas of some continents. However, in that part of the world the people seem to be used to large distances and they can deal with them reasonably well.
I have made a few criticisms and raised a few controversial points, but like everyone else in the debate, from the far Left to the far Right, I have nothing but good will for these people and hope they have a prosperous and happy future, and that they will continue to want to stay in the Commonwealth, as they have so far indicated.
6.11 p.m.
Mr. Paul Dean: I rise to give a warm welcome to the Bill and to wish the people of Tuvalu, who are about to embark upon independence, well. I say that having visited a number of island nations in the South Pacific. The people are among the most friendly and kindly that I have met anywhere, and I am sure that that will stand Tuvalu in good stead as it approaches independence.
I have had the privilege of meeting many of the statesmen from Tuvalu, and I pay a tribute to them for the way in which they assisted in the constitutional conference and in the other conferences which took place in earlier months. I also pay tribute to the Government, and particularly to Lord Goronwy-Roberts for the outstanding part he played in winning the confidence of the statesmen he met and in conducting negotiations which, even when they are between countries which have bonds as strong as those between Tuvalu and Britain, are inevitably difficult.
A number of hon. Members have mentioned the courage of this small nation, and at this time we remember its immense courage during the Second World War. That courage will stand it in good stead for the tasks ahead. I am delighted that Tuvalu will have as head of State Her Majesty the Queen, that it intends to be a member of the Commonwealth and that it intends to sign the Lomé Convention. These steps will ensure the maintenance of strong bonds between Tuvalu and Britain. The two countries also have a strong common Christian heritage, a heritage which is perhaps stronger in Tuvalu these days than in Britain. It is noticeable that many of the leading people in that community are either in orders or have had the benefit of an education by missionaries and so on.
It is also particularly interesting to note that in that part of the world there are a number of British colonies that will be receiving independence at about the same time. Among those colonies is the Solomon Islands, the Bill on which we discussed a few weeks ago. I was unable to take part in that debate because I was in West Africa. There are also the Gilbert Islands, and we look forward to their receiving their just and due independence before too long. I hope that

893
as part of that independence settlement there will be justice for the Gilbertese and a proper place for the Banabans. One hopes that before long the New Hebrides will be following the same path.
There is, therefore, a series of island States in that fascinating part of the world all of which are approaching independence at about the same time. I am glad that the Under-Secretary emphasised that Australia and New Zealand will continue to play a leading part with Britain in providing various kinds of aid for this new nation, Tuvalu.
Against that welcoming background, I wish to raise two specific points that I hope the Under-Secretary will deal with. A number of hon. Members have suggested that a federal solution is probably the answer to these island nations in that part of the world. I wish to utter a word of caution about this. We in this country have had some experience in the last 20 to 25 years of trying to impose federal solutions. On the whole they have been unsuccessful. For us to appear to be trying to sugegst a solution of that kind at this time would be very unwise. After all, we are discussing independence for Tuvalu when only recently it separated of its own free will from the Gilbert Islands. It may be that in process of time these nations will wish to come closer together economically. However, it is far better that that should happen as a natural and evolutionary process and that there should be no suggestion of that type of solution being imposed or even suggested from this country.
I turn now to the economic future. The Under-Secretary rightly emphasised the importance of the aid and investment that is provided being used to ensure that the economy of this small nation becomes viable both in its own eyes and in the eyes of the world. I hope that the Minister, however, will be able to give the House more information about what is proposed. He did not give an adequate answer to the questions I put earlier. I hope that he will deal with this matter during the debate so that we may judge a little better the effectiveness and direction of British aid in particular.
The Minister mentioned that there would be budgetary aid. That is fully understood. That follows the normal pattern for a country of this kind. He also mentioned that there would be
894
capital development aid on grant terms and technical co-operation. He said that these three types of assistance had been agreed up to 1980 and that before they ran out further consideration could be given to additional assistance which might still be required. That follows a fairly traditional pattern, and I understand it. He said, however, that in addition there would be a special development fund with no time limit. It would be helpful at this stage to have a little more information as to the nature of the fund and the sort of projects that it is intended should be promoted by it.
I wish to deal with the Lomé Convention. I am delighted that Tuvalu, along with one or two other countries, such as Fiji, which are already benefiting from the Lomé Convention, intends to sign it.
However, I hope that Her Majesty's Government recognise that Tuvalu will need a lot of assistance from Her Majesty's Government in making its appropriate applications to the Lomé Convention. One cannot expect a country of this size, taking on independence, to know its way around Brussels and to know how to make applications under the Lomé Convention for the various grants that are available.
I hope, therefore, that the Under-Secretary will give an assurance that in relation to this particular form of aid which will be available Her Majesty's Government will do their utmost to ensure that the Government of Tuvalu understand the procedures in order to make applications, because I feel that they will welcome the advice and help of Her Majesty's Government in ensuring that they are able to gain whatever is their due under the Lomé Convention.
I hope that the Under-Secretary will be able this evening to enlarge a little on those two points.
I conclude, as I began, by giving a warm welcome to the Bill and by sending, along with the whole House, warmest wishes to the Government and people of Tuvalu as they embark on their independence.
6.21 p.m.
Mr. Stanley Newens: The achievement of independence by the people of Tuvalu is very much to be welcomed, and I join with other hon. Members in adding my good wishes.

895
I believe that it is right that all peoples, even those living in remote islands constituting only small populations, should have the right to self-government and the right of their national self-determination to be recognised. We do it in the case of larger populations, and I think it is equally desirable that we should do it in a case such as that of the people of Tuvalu. I therefore express my support for the Bill very warmly.
At a time such as this, however, it would be wrong if we did not recognise the difficulties, to which hon. Members have already drawn attention, which confront a small population of 10,000 people in facing up to the very many problems which independence will bring. In much larger territories, political independence has not always been followed by economic independence. Indeed, the discovery of some source of economic wealth has frequently led to the end of effective political sovereignty for people of a particular territory. In other words, colonialism has all too frequently been succeeded by neocolonialism.
The bitterness that some citizens of Tuvalu may feel at present about past events could in certain circumstances be paralleled by future bitterness produced by difficulties arising from the discovery of some source of wealth. In these circumstances, I hope that we shall give all possible help to the people of Tuvalu in overcoming any problems that arise in this way.
As has been said, Tuvalu will undoubtedly need economic aid, and aid in terms of grants may not be sufficient. The people of Tuvalu may well wish to visit this country. I hope that we shall be prepared to welcome to Britain the citizens of Tuvalu who wish to undertake educational or training courses and that we shall be prepared in the future to endeavour to assist them with all the technical, educational and training aid that they require. I hope that we shall assist them by providing them with personnel if that appears to be what they desire.
It is important that in a debate of this sort it does not appear that we are merely washing our hands of certain islands and certain people which have become troublesome in the conditions of the
896
modern world. I very much welcome their independence and wish the people of Tuvalu well, but I hope that they will continue to feel that they have friends in this country. I hope that we shall assure them that in the future we shall be prepared to give them tangible proof of our friendship, not by undermining their independence but by offering them any reasonable form of assistance that they may require.
I believe that over the years many difficulties will be faced by a people in a small territory such as this, but if they genuinely feel that they can turn to people in Britain, or elsewhere for that matter, for assistance without the feeling that they will merely be subjected to some form of economic thraldom, this will greatly assist them in making progress and in achieving proper standards of life and decent conditions.
On this basis, I take great pleasure in welcoming the Bill and wishing all prosperity to the people of Tuvalu in their independent future.
6.25 p.m.
Sir Raymond Gower: I merely want to add one or two remarks to what has already been said.
Naturally, like all others who have participated in the debate, I support the Bill and I wish everyone in this very small territory every good fortune in the years ahead. At the same time, as I intimated in an intervention earlier, this is something on a scale completely different from the kind of Bill that was passed years ago when we first embarked on the very difficult operation of extending self-government to territories of differing sizes, histories and attainments. As I intimated, it was not long ago that we did not contemplate the possibility that territories of such limited resources and such small populations as this would be likely to embark upon self-government.
In one sense, I suppose that our obligation to a territory of this size may be deemed to be greater than was the case with a much larger territory such as Nigeria, with its far greater resources. Indeed, it can be said that Britain has still sufficient wealth to do something for the smaller territories. We simply do not have the resources to do much for some of the great territories such as India and

897
Pakistan and countries of that size, but I imagine that for the foreseeable future we can hope to do something if countries such as Tuvalu unfortunately have probblems which cannot now me foreseen.
Mr. Welsh: In accepting the Bill and the principles behind it, is the hon. Gentleman saying that there is no country in the world that is too small, too poor or to separatist to be given independence?
Sir R. Gower: No, I am not saying that. I am pointing out some of the very serious problems that are likely to arise for a territory as small as this. If the hon. Gentleman cannot draw a distinction between a small, remote territory in the middle of the Pacific Ocean and a country such as Scotland, which is part of the single island of England, Scotland and Wales and is integrated with the life of England and Wales, I just cannot understand his argument. We are dealing with something very different. I was trying to emphasise some of the difficulties.
That is why there is something almost sombre about the phraseology of Clause 1, which says that after independence day
"Her Majesty's Government in the United Kingdom shall have no responsibility for the government of Tuvalu."
It is almost a frightening phrase. It is almost like saying that we should have no responsibility for the people of Tuvalu. I suppose that legally that is the position. This is the legal language in which the Bill must be couched. But we have a very great moral responsibility for the people of this territory, and of similar territories, although there are very few in the particular position of this territory. They will have very great problems.
The hon. Member for Harlow (Mr. Newens) said that some of the people will be coming here on visits. Of the 8,000 or so people there, how many does he think will be able to afford to come here on a visit? It is inconceivable that many of them would be able to afford it.
Mr. Newens: I entirely agree with what the hon. Member has said. I hope that we will endeavour to assist people in making that tremendous journey if they want to come to here for education and training. That was precisely my point.
Sir R. Gower: There is nothing in the Bill or in the associated arrangements to ensure that. Perhaps it is merely a pious hope, with which I agree. However, we should be doing something more. There is nothing envisaged beyond what was outlined by the Minister at the beginning of the debate.
I share the hope of the hon. Member for Birmingham, Handsworth (Mr. Lee) that there will not be compulsion. My hon. Friend the Member for Somerset, North (Mr. Dean) was quite right in saying that there must not be compulsion or a dogmatic approach to the problem of a federal solution. On the other hand, we should be persuasive in pointing out the advantages that could accrue from some getting together of these territories. With our constitutional know-how, we could try to persuade territories such as Tuvalu to co-operate more than they at present intend to do.
There must be some organisation beyond anything that we have at present to assist territories such as this, which are too weak. Tuvalu will be a weak and frail State for some time to come. It will not have the resources to arrange for reasonable education for its citizens, to ensure modern health treatment and so on. It will need help, encouragement and finance from the countries which have the means to give it assistance.
I welcome the principle of the Bill, but I am not entirely happy about the way in which this small territory is prematurely plunging into the great responsibility of independence without the resources to do so. While I hope that all will be well, I have anxieties. Tuvalu is not the sort of territory which can look forward to prosperity in the years to come. We must consider the possibility of its encountering great difficulties. Future Parliaments should be generous beyond the terms of the Bill or the arrangements outlined by the Minister.
6.33 p.m.
Mr. Gerard Fitt: I had not intended to become involved in the debate, but some of my colleagues in the corridors compelled me to make a little contribution. Representing an Irish constituency and knowing something of the history of Ireland, I had always believed that when independence for any territory was being discussed in the House the corridors and the Chamber would

899
be packed and there would be an atmosphere of tension. I now find fewer than 20 people present to discuss the independence of Tuvalu.
There are not many people in the House who are aware of the pronunciation of the name of this territory. I have heard various pronunciations. In the Bill, we are giving independence to a territory which was formerly part of the British Commonwealth. The hon. Member for Barry (Sir R. Gower) said that this small territory with a small population might be seeking independence prematurely. When, in the view of Conservative Members, did any part of the British Empire or any colony seek independence other than prematurely? If we had been talking about whether it was right at this time, India, Pakistan, Kenya and other parts of Africa and all the colonial settlements which were formerly governed by Britain would still be part of the Commonwealth.
I recognise that there is only a small population in Tuvalu. The Government would not be extra generous if they ensured that the people of Tuvalu had a good economic future. It may be that the people cannot do better and that they are not facing the facts of life. The economic considerations of Tuvalu may make them worse off than they are now, but they have an ideology. They believe that they can govern their territory themselves rather than be governed by someone 10,000 or 20,000 miles away. They may be wrong.
I hope that the Government will some day, possibly sooner rather than later, see the wisdom of arriving at the conclusion that it may be easier not to govern a reluctant island just off the mainland of Britain.
Sir Raymond Gower: The point that I made in my speech was that in ending our responsibility for the government of the people of Tuvalu we are not ending our responsibility for the people themselves.
Mr. Fitt: I find that a hard distinction to draw. We hear statements every day from Amnesty International and other people about the moral obligation to look after the interests of the people and of the country. Perhaps we shall have the opportunity to discuss those issues as well.
900
The hon. Member for South Angus (Mr. Welsh) said that there was a similarity between what is happening with Tuvalu and devolution of power from England to Scotland. I am as much a nationalist, though in relation to Irish nationalism, as any Scottish National Party Member, but it would not be totally fair to compare what is happening in the Pacific with what is happening here.
Mr. Welsh: Each situation is different. I merely pointed out the irony of hon. Members eulogising on the benefits of self-determination and independence. I hope that they remember those words when it comes to devolving some sort of political power to Scotland.
Mr. Fitt: I agree entirely with the hon. Gentleman. I have already indicated that there is not a right time for anyone wanting to break away from the British Commonwealth or the British Empire.
Fortunately, on the Labour Benches—I refer particularly to my hon. Friend the Member for Harlow (Mr. Newens)—there are many people who for many years have fought a tenacious battle to ensure that people who wanted to attain independence, whether they were right or wrong and whether there was a rosy or a bleak future for them, had the opportunity to find out for themselves.
I hope that this small country, with its small population, will have a rosy future. I wish the people of Tuvalu all that they wish themselves, but I hope that future British Governments will not take the view that because the island has cut its links and is no longer part of the Commonwealth we should disregard its economic future. I hope that British Governments will be as generous to this small group of people as they have been to others in the past.
6.40 p.m.
Mr. Luard: I shall try to reply to as many as possible of the points raised by hon. Members. The debate has shown that there is no controversy about the main purpose of the Bill. We all welcome independence for Tuvalu and wish the best possible future for its Government and people. Hon. Members have referred mainly to detailed points about the way in which the island's future will be safeguarded, arrangements made by the British Government and so on.

901
The hon. Member for Streatham (Mr. Shelton) referred to the criteria that he and the Opposition consider when a question of independence arises—for example, do the people wish to have independence? There is no doubt that the people of Tuvalu wish independence for themselves. Are their constitutional rights and liberties adequately safeguarded? I said earlier that such arrangements had been made. We were concerned about this point, and I shall mention it in greater detail later. Has the economic future of the territory been adequately safeguarded? I said quite a lot about this, and I shall elaborate about the precise ways in which we hope to give assistance in future.
The hon. Member for Streatham raised specific points that he said had been brought up by the opposition group at the independence conference. One was the feeling among some people in Tuvalu that they might have been able to have a share of some of the phosphate revenues for Ocean Island. The Government of the Gilbert and Ellice Islands had a share of those revenues when Tuvalu was still in association with the Gilberts. This was not primarily a matter for us. Tuvalu was asking for separation from the Gilbert Islands, and that had to be conceded by the Government of the Gilbert Islands. Not surprisingly, they made certain conditions and one was that they would retain control of the phosphate revenues fund. This was accepted voluntarily by the representatives of Tuvalu. They may have raised certain matters, but they accepted that they could not claim any share of those revenues. Discussion is continuing about Ocean Island and the Banabans in that respect, but that is a separate problem.
The hon. Member for Streatham also raised the claims made during the independence conference that Tuvalu should be able to make a claim to one of the Phoenix and Line Islands. This claim could be conceded only by the Government of the Gilbert Islands, and they believe that all the Phoenix and Line Islands should be part of the Gilbert territories. They were not prepared to concede the Tuvalu claim, but it was left that this was a matter that was open to the Government of Tuvalu to continue to raise with the Gilbert Islands
902
in any manner open to them. They accepted that in accepting the proposals for independence.
The hon. Member for Streatham said that one of the opposition leaders had spoken with some bitterness at the independence conference and had felt that Tuvalu had been neglected by the previous colonial Government. I think that this was said more in hope for the future than in regret for the past. I think that the leader in question felt that Tuvalu was not the most prosperous place in the world. No one denies that, but we have been engaged in a fairly extensive development programme over several years and Tuvalu was sharing in the general development of the Gilbert and Ellice Islands in previous years. More important, we have made substantial commitments of economic aid in future. Those who went away from the independence conference were reasonably well gratified with our offers—and that includes members of the opposition group in Tuvalu.
I was asked about future arrangements for the defence of Tuvalu. A territory with 9,000 people cannot expect to be able to engage in extensive defence forces of its own. No one in Tuvalu, least of all the Government, has any great ambitions in that direction. Neither we nor the Government of Tuvalu believe that the island is subject to any external threat. It does not expect to be invaded by its neighbours, and the fact that it has no defence forces is not a matter of great concern to the Government of Tuvalu.
Arrangements to help directly or indirectly, in the defence of the island could be made only on a regional basis. We all accept that the long-term future and security of a little territory in the Pacific must lie in close co-operative arrangements with its neighbours. However, if the Government of Tuvalu asked us for help in acquiring a fisheries protection capability we would be prepared to give training and assistance for that, but that would be help of a special sort designed to help them to help themselves.
My hon. Friend the Member for Lewisham, West (Mr. Price) asked a number of questions. He welcomed the fact that Tuvalu was to be party to the Lomé Convention but wondered whether more assistance could be given to small States of this sort. We have given a good deal

903
of help. Of course, we recognise that, in the initial stages, we must help in making such arrangements. For example, immediately after the independence conference we made arrangements for the Chief Minister of Tuvalu to go to Brussels. Our representative there arranged for him to meet significant figures in the EEC Commission in order to set Tuvalu on its way to making such arrangements. I am sure that we shall continue to be willing to give whatever assistance of this sort is needed, as we do for other small territories.
My hon. Friend also mentioned other problems faced by small States when they become independent, particularly the fact that there was a need for regional arrangements, possibly even for a federation in the area, and he stressed that these small island territories are able to claim large areas of the ocean as part of their 200-mile zone, both for fisheries purposes and for claiming the resources beneath the seas.
My hon. Friend seemed to regard this as representing a threat to them because those attributes might be attractive to large Powers which might feel tempted to try to get their hands on them. I look at this in another way. The claim that these territories are able to lay to large parts of the surface of the waters and areas beneath the seas represents one of the few resources at their disposal. These resources should not be minimised, because they provide the best hope for the future of many of these territories. They need not fear that they will be subject to claims from elsewhere. Such claims can usually be settled through normal diplomatic negotiations, as similar fisheries claims are being settled all over the world.
My hon. Friend mentioned the need for co-operative arrangements. Tuvalu will be represented in the South Pacific Fishing Agency, when it is formed, which will negotiate fishing rights on behalf of small territories with fishing fleet owners from outside the area. That is one arrangement which will assist Tuvalu.
The hon. Member for South Angus (Mr. Welsh) and my hon. Friend the Member for Birmingham, Handsworth (Mr. Lee) talked about the prospects for independence of some other territory with which this debate is not concerned.
904
That semed an abuse of the procedures of the House. As the hon. Member for South Angus said, today is the day of Tuvalu, and most of us came here to discuss its affairs and to wish it well. It is not a constructive approach to spend most of the time on the affairs of Scotland. However, the constitutional futures of both Ocean Island and Scotland are being debated elsewhere and these matters will be resolved through normal constitutional procedures.
Mr. Welsh: The Minister mentioned abuse of parliamentary procedures. I hope that he and others will draw some general principles from this debate which may be of use elsewhere. Let him think about that.
Mr. Luard: There is one general principle which the hon. Gentleman totally ignored, and that is the only one which is relevant here. We are talking about a territory whose people are almost unanimously clamouring for independence. That is not the case with Scotland. A handful of hon. Members claim to want that, yet every opinion poll that I have seen shows that little more than 20 per cent. of the population of Scotland—I am sorry to devote any time to Scotland at this moment—might want independence. There may be an opportunity of testing their wishes in the near future.
My hon. Friend the Member for Handsworth mentioned the arrangements to safeguard human rights after independence. As I said, it is never possible to publish the constitution at the time of an independence debate of this kind—it will be published shortly—but obviously its text is known. I assure my hon. Friend that those points are adequately safeguarded.
A whole chapter of the constitution is concerned with the protection of fundamental rights and freedoms of the individual—the right to life and liberty, the security of the person, protection of the law, freedom of conscience, of expression, of assembly and association, protection for the privacy of the home and of other property, protection from deprivation of property without compensation, provision that no person shall be deprived of his life intentionally, protection of the right to personal liberty, and freedom from inhumane treatment and from slavery and

905
forced labour. I hope that that reassures my hon. Friend.
However, I agree with my hon. Friend the Member for Lewisham, West that few peoples in the world have less need of special protection of their rights than the peoples of the Pacific areas, who have traditionally shown great concern in that respect.
I can also assure my hon. Friend the Member for Handsworth that a right to appeal to the Privy Council will be maintained and included in the constitution.
My hon. Friend also asked for more detail about the types of development that we hope to assist in Tuvalu. As I said, we are anxious to work in cooperation with the Government of Tuvalu. What happens will depend on the application for assistance that they make, but I can suggest the kind of areas where we think development assistance will be of value.
Obviously, there is great scope for the development of fisheries, with which we are already giving assistance. There is scope for the development of coconuts and the copra industry—one of the few crops which can be grown in this small territory is the coconut. We shall also be helping with the development of the handicrafts industry and to some extent with subsistence agriculture. There is also the possibility of developing fish-related industries.
My hon. Friend also mentioned regionalism.
Mr. Lee: On an allied point, has the question of currency been considered? This is not strictly a matter of economic development, but newly independent countries sometimes like to mark their break with the past by creating their own currency—often with disastrous consequences, because it has no negotiable value and crashes to the floor. I hope that the Government of Tuvalu will not fall into that trap and that they will be counselled to that effect by my hon. Friend.
Mr. Luard: So far as I know, that question has not arisen, but I will look into the matter and write to my hon. Friend if necessary. As he knows, I was not myself concerned in these negotiations.
906
Regionalism is an important question considering the future of Tuvalu. My views fall between those of my hon. Friend the Member for Handsworth and those of the hon. Member for Somerset, North (Mr. Dean). We certainly cannot impose any kind of federation or federalism in the Pacific area. That must be a matter for the peoples and Governments of those islands, and it is up to them to enter into discussions and negotiations.
However, no one would deny that there must be the closest co-operation between those peoples and Governments. Some of them are small territories. They have a number of common problems. We should all wish to see closer co-operation under which they can face those problems with common solutions. Apart from the effort and activities of the Governments themselves, a number of outside bodies may be able to help.
The British Government will give whatever help they can, although we are no longer closely involved. Obviously, the Governments of Australia and New Zealand will wish to take a close interest in the affairs of these territories and to help in promoting co-operative arrangements. Some international organisations may be concerned. The Commonwealth may have a role to play. The regional meeting in Sydney promoted by the Australian Government earlier this year was a valuable initiative which may set a precedent, not only in this area but in other parts of the Commonwealth. I hope that that kind of regional arrangement will be promoted and sustained by the Commonwealth.
If I may give my personal view, I should like to see the United Nations playing a larger role in assisting newly independent territories which face great difficulty. I said that the UNDP will be giving some economic assistance, but perhaps the United Nations could play a larger role.
The hon. Member for Somerset, North spoke of the warm and friendly character of the people of Tuvalu and, indeed, of the whole area. I entirely endorse what he said. I welcome what he said about the role of my noble Friend the Minister of State, Lord Goronwy-Roberts, who has had the entire responsibility—I hope it was a pleasant one—of undertaking these negotiations and whose very valuable contribution I personally know very

907
well. I am glad to join in the tribute paid to him by hon. Members today.
The hon. Gentleman also asked about a federal future in the area. I have already covered that aspect.
The hon. Gentleman asked me in particular about the type of aid which the Special Development Fund would be providing. I have indicated the areas in which that money might be used. What is specific is that the projects will be proposed by the Government of Tuvalu rather than by the British Government. There will be no time limit. The other types of assistance are in regard to moneys to be spent largely by 1980, and we shall then consider what we can do for the future. This is a continuing programme involving £2½million, and it will remain in existence for some time to come.
The hon. Gentleman also asked about the possibility of giving assistance in helping the Tuvalu Government to make their arrangements under the Lomé agreement. As I have said, we are prepared to give help of this kind. We have already given some help, and we shall continue to do so in the future.
I do not think that there was anything in the remarks of my hon. Friend the Member for Harlow (Mr. Newens) with which I could disagree. I confirm that we shall by no means be washing our hands of Tuvalu and the people of Tuvalu when the independence Bill is passed. Clearly, we shall not be doing that. I mentioned the development assistance, which will be continuing for a considerable time in the future. We shall be maintaining contacts through the usual channels. We shall have diplomatic representation through our High Commission in Suva. Tuvalu will be maintaining links of the same kind with the fellow members of the Commonwealth, so that there will be a number of forms of contact and communication. We shall take account of the points that my hon. Friend mentioned in his speech in considering how our development aid should be used in the future.
I do not take quite such a gloomy view as my hon. Friend took or as the hon. Member for Barry (Sir R. Gower) took in his speech. The hon. Gentleman seemed to feel that it would be impossible for such a very small territory to survive at all. I do not think that this is necessarily
908
the case, provided that our own Government, above all, and others, such as New Zealand and Australia—as well as the United Nations, the Commonwealth and the international organisations that I have mentioned—continue to play an active part in giving assistance. I believe that with such assistance, territories of this kind can survive perfectly well and become better able to survive in the future on their own resources than they are now.
Mr. Newens: I am sure that my hon. Friend did not understand me to take such a gloomy view that I did not believe that Tuvalu would be able to survive. I very much welcome the Bill. I merely asked about certain forms of aid and in particular about the ability of the people of Tuvalu to visit this country and to receive education and training here.
Mr. Luard: The people of Tuvalu will be able to qualify for educational grants in the same way as other people from developing countries, and in many cases those grants will provide for funds to enable them to come to this country.
It was the hon. Member for Barry who was taking a very gloomy view as to the possibilities of the people of Tuvalu being able to survive on their own. My answer is that they will not be entirely on their own. They will have friends who are willing, ready and anxious to help. I believe that the people of Tuvalu will develop capacities of their own and industries of their own—above all, the fishing industry—which will make them better equipped than they are today to survive on their own feet.
I hope that I have answered the main points raised in the debate. I reiterate, in conclusion, the very warm welcome that we in the Government give to the Government and people of Tuvalu on attaining independence. I wish to say how pleased we are that they will remain a fellow member with us in the Commonwealth. On behalf of the Government and of the House, I extend to Tuvalu our very warm wishes for the future.
Question put and agreed to.
Bill accordingly read a Second time.
Bill committed to a Committee of the whole House.—[Mr. Jim Marshall.]
Bill immediately considered in Committee; 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, without amendment.

TUVALU BILL [Lords]

  EXPORT GUARANTEES AND OVERSEAS INVESTMENT BILL [Lords]
  Bill read a Second time.
  Bill committed to a Committee of the whole House.—[Mr. Jim Marshall.]
  Bill immediately considered in Committee; 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, without amendment.

OATHS BILL [Lords]
Bill read a Second time.
Bill committed to a Committee of the whole House.—[Mr. Jim Marshall.]
Bill immediately considered in Committee.
[Mr. BRYANT GODMAN IRVINE in the Chair]
7.10 p.m.
The Second Deputy Chairman (Mr. Bryant Godman Irvine): With the permission of the Committee, I shall put Clauses Nos. 1 to 8 together.
Mr. Ivor Stanbrook: On a point of order, Mr. Godman Irvine. May I ask that you put Clause No. 1 separately from the others?

Clause 1

  MANNER OF ADMINISTRATION OF OATHS
  Question proposed, That the Clause stand part of the Bill.
  Mr. Stanbrook: This is a consolidation Bill, but it seems a great pity that it does not consolidate the law on this subject. This is a complaint that I have made before. I do not think that the consolidation process of the House is being properly done if we are leaving law surrounding one subject inadequately covered by a consolidation Bill.
  For example, Clause 1(1) states the form of the oath in the case of the New Testament and the Old Testament. It gives the appropriate words which should be used, but it goes on to say:
  "followed by the words of the oath prescribed by law."
  This is just one of those occasions when surely the words prescribed by law ought to be included in the statute which deals with this subject. For that reason, I believe that Clause 1(1) is quite inadequate to deal with the point, as is subsection (3), which states:
  "In the case of a person who is neither a Christian nor a Jew, the oath shall be administered in any lawful manner."

  911
  Here again, there is no assistance to anyone who looks up the Oaths Act to see what is the legal definition of an oath with regard to what is a lawful matter.
  The Parliamentary Secretary to the Law Officers' Department (Mr. Arthur Davidson): I am delighted that someone has actually shown interest. As the hon. Gentleman knows, this is purely a consolidation measure. The clause to which he refers merely reproduces the identical section which is embodied in previous legislation and which is existing law. Therefore, whether or not the hon. Gentleman considers that the law is inadequate is a matter which, unfortunately, cannot be discussed on this consolidation Bill, fascinating though it might well be. All that the Bill does, as in the case of any consolidation Bill, is to put in one enactment the existing law which is embodied in several other enactments. The Bill does exactly that.
  Mr. Stanbrook: What the Bill should do is consolidate the law. That is the purpose of consolidation Bills. Instead of that, the tendency has been to consolidate only certain statutes. If the process has to be consolidation of the law, it should certainly be the duty of those responsible to gather all the law relating to the subject and consolidate it and not leave us with little Bills of this kind
  912
  which only amend the law, because a lot of it is contained elsewhere in different statutes. As a result, we do not have a comprehensive statement of the law in one consolidation measure.
  Mr. Davidson: I shall, of course, pass on to the appropriate sources what the hon. Gentleman has said The Bill has been before the Joint Consolidation Committee. It has been carefully scrutinised by it and by another place. The Bill consolidates the statute law. However, I understand the hon. Gentleman's concern. I assure him that I shall pass on what he has said to the appropriate sources, who, I have no doubt, will read it with great interest.
  Question put and agreed to.
  Clause 1 ordered to stand part of the Bill.
  Clauses 2 to 8 ordered to stand part of the Bill.
  Schedule agreed to.
  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, without amendment.

EUROPEAN COMMUNITY (NON-LIFE ASSURANCE)
7.16 p.m.
The Under-Secretary of State for Trade (Mr. Clinton Davis): I beg to move,
That this House takes note of EEC Documents Nos. R/95/76 and R/467/78 on Non-Life Assurance.
I very much welcome the opportunity of debating Commission documents Nos. R/467/78 and R/95/76 which are now before the House. No one can doubt that insurance is a vital industry in this country. At home it provides a full range of services and abroad it makes a massive contribution to our export earnings. Without a doubt London is the prime insurance market of the world. I am sure that hon. Members will agree that any proposals emerging from the European Community which might affect this industry's ability to maintain its fine record are, therefore, of great concern to all of us.
There is another reason for welcoming a debate on this subject at this stage. That is that the directive is still in the process of detailed negotiation, and significant changes may still be proposed. Accordingly, the views which hon. Members express will be of extreme value in the development of the Government's policy over the coming months. I think it is right that the voice of the House of Commons should be heard. That is not without significance to the ability of our negotiators to proceed to the best possible advantage in improving these matters.
Before I go on to deal with the directive itself I should like to bring the House up to date with progress in Brussels on insurance generally. It is against that backcloth that one must view these Commission documents. I am happy to report that there has been some progress. Just 14 days ago, after difficult and protracted negotiations, the Community coinsurance directive was adopted. This represents the second major step towards a common market in European insurance. This opens up to competition the whole area of those very large commercial risks which, because of their size and nature, need to be shared among a number of insurers.
When this directive comes into operation, Lloyds and other companies in this
914
country will be able to participate in covering such risks through their United Kingdom establishments. But the directive offers Europe much more. It will allow those among our partners who fear the effects of a more liberal insurance market to see how in reality such a market is able to operate to the benefit of Europe as a whole. Perhaps of still more relevance, it will pave the way for the increased freedom of insurance services envisaged by this directive.
The other main directive under discussion in Brussels is that covering establishment for life business. It will be recalled that it was debated in this House about a year ago and that a number of difficulties arising out of it were discussed. I do not think that I am being overoptimistic when I say that there is now some prospect of compromise being reached on the major outstanding issues. Our delegation at Brussels will be tabling proposals tomorrow leading, we hope, towards a solution, and our industry has accepted these after a considerable amount of heart searching. I pay tribute to those who have worked closely with my officials in trying to arrive at a solution.
Inevitably, it involves compromise, and our action on this life establishment directive should be regarded by our European partners as a sincere effort to solve certain difficult issues. Equally, it should help towards creating a good climate in which discussion of this non-life services directive may be pressed ahead in Brussels.
It remains true that progress on the insurance front has been slow, and it may be helpful if I outline some of the reasons for this. Enormous differences in current practices exist between different member States. It is not only a matter of what degree of protection the State should seek to provide for the insured or even of the extent to which protection should be provided to business men insuring their interests. It involves different philosophies of means of control. We seek to give consumers freedom of choice from a wide range of contracts offered by competing companies. We rely more on looking to the general financial strength of companies. This reflects substantially the fact that our industry plays a major part in international trade in insurance. Some other member States regulate the contents of policies and the premiums

915
charged. Some also control in detail the investment of money by their insurance companies. The differences of approach inevitably make for difficult decisions for all.
The directive that the House is considering has been under discussion in a Council working party since the beginning of 1976 and it has reached the stage at which the major points of difficulty have emerged and had some detailed consideration.
It may be considered in two parts. First, it contains rules on the further coordination of certain aspects of non-life insurance operations and of insurance contracts generally. Amongst the most important of these are the calculation of technical reserves and the treatment for tax purposes of these reserves. It is our belief that some harmonisation is possible on the methods of reserving, but article 3 of the directive is unacceptable in its present form. We would wish to see a more flexible approach. On the taxation aspects in the same article, we consider that any proposals for harmonisation should properly form part of a tax directive rather than appear in an insurance directive.
Secondly, the main purpose of the directive is to settle the rules under which insurance companies may do business throughout the Community on a services basis without having to set up establishments in each member State and have the business regulated by that State. I might note here that we in the United Kingdom already freely allow such services business. The other members have regimes with varying degrees of liberality.
The key to the directive lies in Articles 4 and 6. The first paragraph of Article 4 says that, pending co-ordination of national provisions covering insurance contracts, they shall be governed by the law of the country in which the risk is situated. The second paragraph then provides the exception that the law chosen by the parties shall govern contracts covering a listed range of commercial risks. Article 6 then provides that each member State may continue to apply national rules relating to policy conditions and tariffs save for the range of commercial risks enumerated in the
916
second paragraph of article 4 to which I have already referred.
The effect of these two articles taken together is that each State can ensure that the mass consumer and smaller business risks remain subject to its own national rules, but that free international competition will become possible for contracts covering, first, credit and surety ship risks; secondly, marine, aviation and transport risks where the insured is engaged in business and the risks resultant to his business activity; and, thirdly, commercial property, fire and damage risks of above the minimum sizes set out in the article, plus any associated liability risks.
We would have liked to see the directive providing freedom further down the line and will be pressing for further amendments, for example, for lower limits for the cut-off points in article 4 for industrial and commercal property risks. However, the present provision would open up to our industry major new opportunities in Europe. This is the nub of the whole directive.
The principles enunciated in article 4 concerning freedom of choice of contract law, are of fundamental legal importance. At the instance of my right hon. Friend the Secretary of State, therefore, the Lord Chancellor has referred this matter to the Law Commission and to the Scottish Law Commission because we need their advice on the exact effect of current proposals and on how they will affect other aspects of the law. There is a more general implication, and it is right that the Law Commission should examine the position. We shall need to hear the opinion of these bodies before we make any decision on the final line we are to pursue in Brussels. Moreover, I should add that it is possible that all the provisions relating to choice of law and applicable law may well be transferred to the Private International Law Convention, which is also under negotiation in Brussels.
Article 8 of the directive provides that any company wishing to do business on a services basis in another member State should seek separate authorisation for this from its own national supervisory authority. We consider this to be unnecessary.
We are also opposed strongly to the principle enunciated in article 13.2 that

917
underwriting liabilities expressed in a particular currency must be matched strictly by assets expressed or realisable in the same currency. It is our opinion that insurance companies need flexibility in applying such a rule. There is, I should add, a working party of experts examining this whole question, following agreement on the coinsurance directive, and the final text in the non-life services directive is likely to reflect very closely its eventual conclusions.
Finally, we are examining the Commission's latest proposals, which follow closely the views expressed by the European Parliament, that companies whose head offices are situated outside the Community should benefit from the directive on an equal footing only where the third countries concerned have concluded a reciprocal agreement with the Community. I should welcome the views of the House on this point in particular.
In introducing this debate, I have sought to keep any remarks uncharacteristically short. I have not entered into detail on many points. There are good reasons for that, I am sure. In particular, I have not described all our detailed points of difficulty on the directive.
If I am pressed on any point I shall try to elaborate, assuming that the House gives me leave to speak again. I am not sure that I would welcome that, but I am prepared, if requested, to make yet another appearance.
In conclusion, I emphasise the importance of the directive for this country's insurance industry. I know that it does not cover all the types of risk that we would have wished to see covered, but we welcome it as marking a further major step towards a true common market in insurance, which is the wish of us all.
The directive provides the way ahead for an opportunity, which will be seized by our industry. The industry has been yearning for that opportunity, and I hope that it will not be denied it for much longer.
7.21 p.m.
Mr. Cecil Parkinson: I thank the Minister for the way in which he introduced the subject of these very complex and important documents. I welcome the progress that has been made recently on the co-insurance directive, and I hope that the directive
918
on establishments for life assurance also will make progress in the near future.
Many of us recognised when we joined the EEC that some of our industries would find themselves facing very keen competition. However, we had confidence that overall, once they had adjusted to the keener competition with the EEC, they stood to gain. We recognised that some industries would find it more difficult to compete than others.
One of the industries for which we had great hopes was insurance. We have a highly developed, sophisticated insurance industry, as the Minister pointed out, and London is the leading insurance market in the world. We felt that insurance would be one area in which we stood to gain substantially from our membership.
Since 1973, when we joined the EEC, we have opened our market to a whole range of products produced by our EEC partners—particularly cars. It is rather ironic that one of the results of the agreement that we reached with the Japanese on their voluntary restriction of car exports is that French, German and Italian cars have been coming into Britain in increasing numbers.
I shall give one example of the dangers of protectionism. It is a fact that because we are importing fewer Japanese cars the Australians are exporting fewer raw material to Japan. Because of that, the Australians are buying fewer goods from the United Kingdom. Therefore, as a result of Japan's voluntary limitation on the export of cars to us, our European partners are selling more cars to us and the Japanese are buying less from the Australians, who in turn buy less from us. In this instance, far from gaining we are losing out.
This is an example of European manufacturers gaining enormously from our membership of the EEC. They have access to our markets and are selling more cars as a result. It was inevitable that as a consequence of joining the Common Market some of our weaker industries would find the keener competition difficult to cope with.
Equally, our more innovative and competitive industries stood to gain. We had hoped, and still hope, that insurance would be one of these industries. Many of us have viewed with some concern the growing protectionism within the

919
EEC. We joined the EEC and supported our membership in the hope that the Community would be committed to a growing and free market within itself and at the same time be an outward-looking body. Some of the trends revealed in the past few months have caused concern to those of us who are enthusiastic supporters of our membership of the Community.
Britain has a highly competitive insurance industry. As the Minister and I both agree, it is second to none in the world. But, of the non-life assurance business written in Britain at present, the EEC represents far too small a part. We write twice as much non-life business in the United States as is written in the EEC and nearly three times as much as in the rest of the world.
One reason for this is that the French and Germans are very protectionist about insurance. However, this stems not altogether from a dog-in-the-manger attitude but from a different philosophy of insurance. We believe that the insurance market should not be too tightly controlled or directed. We believe that it should be supervised and regulated but at the same time should be allowed a fair degree of freedom to show its ability to introduce new policies and search out new business. Our Continental friends take a much stricter, more dirigiste approach to insurance, and, therefore, it has been very difficult to find common ground. We have a basically different approach to the problems of the industry from that of the French and Germans.
Therefore, one must accept in these circumstances that the evolution of common principles will take time. I was interested to read an article in the Financial Times of 22nd March last year in which Mr. Eric Short, writing about the slowness of members to unify their policy, said that if we were to make progress
"this will involve breaking down some very rigid traditional barriers and over-riding some very entrenched positions."
One accepts that this is right and that it is not because people are being bloody-minded. It stems from a basically different approach to the insurance industry.
Having said that, I pay tribute to Christopher Tugendhat, our Commis-
920
sioner, who is trying to put zip into this process. However, one must express the feeling that progress has been too slow and the hope that our Continental friends will recognise this and try to reach agreement with us with a greater sense of urgency.
I was interested to read Mr. Tugendhat's remarks in the debate in the European Parliament earlier this year in which he said this about the directive:
"The implementation of this directive will constitute an important step towards the effective exercise of freedom to provide services in the area of insurance to the greater benefit of policyholders, insurers and the Community as a whole."
He believes that these directives are very important and that their implementation and agreement by the Council of Ministers will represent a major step towards producing a European common market in insurance, which I am sure we all want.
I was also interested to read in the Sunday Telegraph last week that these directives were described as
"the jewel in the Crown".
It was said that the EEC's non-life service directive, if approved by Ministers
"would at one stroke open up the entire community market for indemnity insurance to all-corners."
Therefore, we are discussing tonight documents which, if implemented, would have a major impact on the European insurance market. The report goes on to refer to the string of technical questions to be hammered out—a list which, frankly, is awesome. I share that view.
Nevertheless, we have the directive in front of us, and, thanks to the efforts of Mr. Tugendhat, among others, there appears to be more and more of a sense of urgency and a desire to get something done. We must support that effort and build on it in every way we can.
It is very difficult for the nine Member countries to harmonise their insurance. If they find this difficult, how are we to tackle the problems of economic and monetary union? This is a tiny foothill compared with the mountain represented by EMU. There are two ways in which an insurer can increase his business and operate within the EEC. The first is by freedom of establishment, the second is by freedom of service. The latter already exists in

921
the United Kingdom. If we are to achieve a common market in insurance, we believe that it is essential that this freedom should be extended throughout the EEC.
It is a matter of regret that the directive effectively limits this vital freedom to the large marine, aviation and transport risks and to large industrial and commercial risks. We welcome it as a first step. In particular, we support the concept of the directive under which the services provided are governed by legislation of the country from which the service is provided—the concept of head office control as opposed to the country-of-risk control, which some of our friends would have preferred. This principle of head office control is very important indeed to Lloyd's, which operates only through brokers, but it would also bring benefit to the United Kingdom insurance market as a whole.
I turn to three major points of detail. The first relates to article 4. It must be a matter for regret that the country-of-risk principle is stated first in article 4(1), with the free choice of law—the head office control principle—for the larger risk being allowed as a derogation in article 4(2). British insurers have indicated to me that they are prepared to go along with this approach, although they would have preferred the emphasis to be the other way round.
The key is the thresholds at which the freedom to derogate is to be allowed. May I urge the Minister to resist in every way open to him any attempt to raise this threshold? If there is any movement at all in the thresholds, I believe that they must be lowered. Indeed, I urge the Minister to press for a lower threshold. There is a suspicion that the threshold may be raised rather than lowered, thus effectively entrenching the country-of-risk control as a basic principle of Community law while paying lip service to the principle of head office control. It is the duty of the Minister and of the Government to ensure that that does not happen. I assure the Minister that, however robust he chooses to be in pressing that point of view on our Community partners, he will have our backing.
I wish now to deal with the problem of liability insurance. In terms of the directive, this relates to class 13 business. As currently worded, it would appear
922
that freedom for liability insurance arrives only when the sum insured for the insured's other business exceeds the 7 million units of account threshold. British insurers feel that there should be no threshold for liability business, and the simple solution may be to move class 13 business from article 4(2)(c) to article 4(2)(a) and (b). They feel that this would achieve their objectiveI urge that point on the Minister.
I wish now to deal with article 13, which deals with technical reserves of insurance, the unexpired premiums and claims for which insurers have to provide before they can declare their profit or loss for the year. The importance of this topic is obvious. For the most part, article 13 makes common sense provision for it. There is, however, a problem lurking in the last sentence of the article:
"This requires the reserves to be covered by matching assets."
In terms of the 1973 EEC directive on insurance, matching assets are defined to mean assets
"expressed or realisable in the same currency as the liability,".
Some people have suggested that article 13 owes more to the fears of the French for their balance of payments if we have a free insurance market than it does to the needs of policyholders. Obviously, an insurer who writes a portfolio of international business with contracts in a variety of currencies has to make suitable arrangements to protect himself against exchange fluctuations. As a matter of prudence, he will usually provide for reserves in a currency in which he has a substantial volume of business. This is a problem of which the larger British insurance undertakings have had many years of experience. They are well able to make their own arrangements, and hitherto the Department of Trade has not found it necessary to lay down any detailed rules.
The problem is that, if we are to have a rigid application of the rule laid down in article 13, it could lead to insurers being compelled to keep small amounts in all sorts of different currencies—a procedure which would do nothing for policyholders and would create many administrative problems.
Let me give an example which has been put to me. Let us take the case of a marine insurer who hitherto has carried out all his business in sterling and who,

923
for the first time, seeks to insure an Italian ship and receives a premium of 1 million lire. Either that one ship will sink, in which case he would need to pay out a great deal more than 1 million lire, or it will not, in which case he would not have to pay out any Italian lire. Therefore, there will be no point in that insurer keeping 1 million lire in Italian currency against an eventuality which he would not be equipped to deal with and which the 1 million lire would do nothing towards solving.
In that instance, no purpose would be served by keeping such a small fraction of reserves in Italian currency. Indeed, much inconvenience could be caused administratively if one had to do it. It seems that that is not a sensible feature of article 13. I hope that the Minister will press for the proposed rule to be relaxed. It is not in the interests of policyholders and it does little to protect them. It could cause additional expense and much unnecessary administration.
As originally drafted, article 15 would have provided for the directive to apply to agencies and branches established within the Community and belonging to undertakings whose head offices are outside the Community. As now amended, in accordance with the recommendations of the European Parliament, the article makes the application of the directive to the branches of third country undertakings conditional upon the existence of a reciprocal agreement with the third country concerned.
I pay tribute to the work of the European Parliament on the draft directives. The debate in the European Parliament was extremely interesting. As a result of that debate, some major amendments have been made to the draft. It is a better document as a result of the work of Members of the European Parliament, especially the British Members.
The law applying to agencies and branches is of great importance to the London market, in which branches of numerous American, Japanese, Swiss and other foreign insurers are functioning. There is a danger that if we discriminate against non-EEC insurers we may invite retaliation against ourselves. Under the old version of article 15, such branches would have obtained the right
924
to business originating in other EEC countries. They will now not obtain that right.
The change seems objectionable on various grounds. First, it is objectionable because it is at variance with the basic principle of a common market in insurance. There are already standard EEC conditions laid down in the first co-ordination directive of 1973 for the admission of branches of external insurance companies to any EEC country. The branches that are functioning in London have satisfied conditions that may be taken to be adequate in the eyes of all EEC Governments. They have been admitted to the market already. If it is a single market, they should be admitted to the whole of it. To provide otherwise is to say that we shall have one common insurance market for enterprises with head offices in the Community but we still have nine separate national markets for those which have head offices outside the Community but have satisfied Community requirements for the setting up of branches within it.
The second objection to the proposal is that it draws an artificial distinction between the branches and subsidiaries of external companies. For example, if an external company forms a subsidiary here, the subsidiary is liable to one set of regulations. However, if a company forms a branch it is liable to another set of regulations. We feel that the real and practical differences between a branch and a subsidiary do not justify that discrimination. We believe that it would be far better to revert to the original draft of article 15. If that cannot be negotiated with the other member States, the second-best option might be to delete article 15 altogether, so that member States which wish to take a more liberal attitude towards branches of third country insurers will remain free to do so while leaving other member States which feel unable to take a liberal attitude free to exclude such branches from writing business emanating from their own countries.
I can well understand that the House found the important and exciting issue of Tuvalu independence far more riveting than the directives. They seem fairly technical and it is easy to underestimate their importance. However, we are talking about gaining freer access for one of our major and most successful service

925
industries—the insurance industry—to the greatest insurance market in the world. It is important that our insurers have the opportunity to trade and to succeed in that large market. I hope that as a result the of debate the Minister will go to the next European meeting with his colleagues determined to back up Mr. Tugendhat in pressing hard for real progress on insurance harmonisation. That is vital to Britain.
When we think that we have only 11 per cent. of the market and that that represents £654 million worth of business, it is easily recognised that we are talking about large and important sums. I wish the Minister every success in pressuring his colleagues to get a move on with the implementation of the directives. In particular, I wish him every success in pressing for the modification of articles 4, 13 and 15 on the grounds that I have suggested.
7.57 p.m.
Mr. Ian Wrigglesworth: I take up the final remarks of the hon. Member for Hertfordshire, South (Mr. Parkinson) by saying how pleased I am that on this occasion when debating a directive it seems that for a change we shall have no one in the House saying what damage it will do to British industry. I hope that those protectionist noises will not be present in the debate. That is a good change and one that some of us who were much in favour of going into Europe expected to see. That is because we thought that many of our service and manufacturing industries were well able to compete with industries of the other members of the Community. It is a pleasure to have an instrument before us that will be of benefit to Britain and to the insurance industry.
I congratulate my hon. Friend the Under-Secretary of State on the way in which he has been of such great assistance in pursuing the directive. I am grateful to him and the Department in seeking to help the interests of the insurance industry not only during recent times but over a long period during which the directive has been discussed.
As has been said, these are enormously complex matters. When we consider the different attitudes and the different laws and regulations applying to the insurance industries in the different countries of the Nine, we realise what a problem it is to
926
achieve harmonisation. The Department deserves our congratulations for the way in which it has pursued with vigour the interests of the industry, to the benefit of both the industry and the whole country.
As we all realise and hope, the coming into operation of the directive could be of enormous benefit to the insurance industry. It could lead to economic benefits, financial benefits and, we hope, employment benefits, as a result of any growth in business that comes from our access to the European market. I think that sonic of the insurance industry in Europe is worried about Britain having access to the market. There is concern that we shall go in and soak it all up, or swamp it. We are asking for a fair competitive opportunity to go in on a freedom of services basis and take a share of what is a growing market without taking away vast amounts of business from European companies.
It is particularly important, as the hon. Member for Hertfordshire South said, to Lloyds which is restricted to operations in the City of London. It can operate only through brokers. It cannot operate under the freedom of establishment it can operate only under the freedom of services. That remarkable institution is of enormous benefit to the insurance industry in this country. It attracts a great deal of insurance business and benefit to our economy in invisible exports and has a high reputation for its services to the rest of the world. The benefits which will accrue to that organisation from having the freedom of services are welcome and we look forward to Lloyds benefiting from them.
There is only one point in general terms which I wish to make. The Minister has already assured the House that he will fight on this matter. In addition to the points referred to by the hon. Member for Hertfordshire, South, I want to refer to one matter before going on to a point which I made in our previous debate on insurance and the EEC. I refer to article 8. The Minister said that this was totally unnecessary. I support him in that view. It seems silly, when providing freedom of access in this way and throwing off the shackles, that article 8 should seek to impose upon insurance companies the necessity to gain authorisation from the national regulatory body

927
before going into the European market. Indeed, in some ways it seems to negate the whole objective of the directive. I hope that the House will support me in saying more power to the Minister's elbow in fighting this point with his colleagues in Europe.
As the House knows, I am a Labour and Co-operative Member. The Co-operative movement has a successful and large insurance society. I do not have any direct connection with it. Most nonlife insurance in this country is transacted by companies which also transact life insurance.
When we last considered insurance in the EEC, which was on 27th April last year, some hon. Members were concerned about the possibility that an EEC directive would require British composite insurance companies to be split into separate companies transacting life and nonlife business separately, to conform with the practice in some, but not all, EEC countries.
At that time, the Government considered the argument against composites to be invalid, but they were prepared, in the interests of obtaining agreement, to accept a compromise that the formation of further composites should not be permitted, on the clear understanding that existing composites would not he touched in respect of their business within the United Kingdom. The Minister gave a specific assurance on that point during that debate.
It now appears that despite the assurance given last year, proposals have been made that the British Government should agree to a ban on new composites without the quid pro quo of an assurance that existing composites would not be attacked. Indeed, I understand that the proposals go even further and include provision for a review of existing composites, and envisage the possibility that they may be required to be broken up by a subsequent EEC directive. Clearly, it would be a serious matter if all composite insurance companies were required to be split into separate companies for life and non-life insurance. I see hon. Members nodding in agreement. I might add that there would not be any compensatory benefit for policyholders.
It would be especially serious for the Co-operative Insurance Society because,
928
as a co-operative society, it cannot raise equity capital. It is a mutual body and it cannot go to the market to raise equity capital. It provides the necessary capital backing for its substantial non-life business by holding its free reserves in common between its life and non-life business. A requirement for it to be split into separate corporate bodies transacting life and non-life insurance might make it impossible for the society to continue to transact non-life business on a co-operative basis. That would be a most unfortunate result. I am sure that would be agreed by all my colleagues in the Co-operative Group and, I hope, by other hon. Members on both sides of the House.
I raised this matter last April and was glad to receive the assurances that the Minister gave. I hope that he will now confirm these assurances and, in particular, tell the House that the British Government will not agree to a ban on new composites being included in an EEC insurance directive, except as part of a package under which it is agreed that existing composites can continue, or to any requirement for a review of existing composites being included in any directive.
8.5 p.m.
Mr. R. A. McCrindle: As is usual in debates on insurance, I start by declaring an interest as the parliamentary consultant to the British Insurance Brokers' Association. Perhaps a little unusually, I should explain that among the membership of that organisation are both the largest brokers at Lloyds and the largest non-Lloyds brokers in the country, whose responsibility stretches to the placing of international risks throughout the world and who therefore have more than a passing interest in what is likely to happen to this draft directive.
Mention has been made both of Lloyds and of the insurance companies. I should like to pay my tribute to the major progress made by insurance companies and Lloyds in maintaining our reputation as the insurance capital of the world. However, like my hon. Friend the Member for Hertfordshire, South (Mr. Parkinson), I should like to indicate a note of regret. Whereas in the United States of America our proportion of business is sizeable to the point of being more impressive than

929
that of any other insurer outside the United States, the same cannot yet be said of our involvement in Europe. Therefore, any opportunity which appears to be developing to increase our insurance business in Europe to the benefit of this country is to be welcomed.
I welcome the draft directive as perhaps the first strong indication that at long last we are on the move towards a liberalisation of insurance within the EEC. I have no doubt that although we shall meet competition from insurers in other leading EEC countries we have nothing to fear, because, traditionally, we have been competitive and prepared to travel the world to introduce our expertise in this sphere. I look forward to the day when we are able to compete within Europe on equal terms with, for example, France and Germany.
It may be a little unusual, but I should like at this stage to pay tribute to the Commission—a body which is not used to frequent congratulations from hon. Members. It appears that it has at long last introduced a note of urgency into the liberalisation of insurance within Europe. For that we are entitled to congratulate the Commission.
It will come as a surprise to the Minister but we are also entitled to congratulate the Government for bringing forward with considerable speed this debate on the draft directive. There may be reasons for doing this which are not related to the European Community. Perhaps the Government are a little short of business to bring before the Commons for discussion. Perish the thought, but perhaps the Government see this as a relatively harmless debate to fill in the time between now and a General Election. For whatever reason, we are pleased that the Government have seen fit to allow a debate on the directive as quickly as they have.
Mr. Clinton Davis: I hope that the hon. Member has concluded his observations on that matter. Clearly this is a matter of significant importance. That is why the Government thought it right that it should be debated. I am sure that it is a matter that is on the lips of every constituent in Brentwood and Ongar.
Mr. McCrindle: I would not for a moment deny the Minister's last observation, because it is self-evident that this
930
is the only topic of conversation in my constituency.
I am particularly pleased because not only have the Government provided time to debate the draft directive but the Minister was at some pains to emphasise that what we say tonight not merely involves comments on an event which has passed but provides an opportunity to influence the Government reaction to the draft directive. I welcome that. It also allows me to deliver a general welcome to the directive.
I should like to give voice to a few cautionary words. Like my hon. Friend the Member for Hertfordshire, South, I shall begin with a reference to article 4. This is a lawyer's paradise. As a non-lawyer, I do not pretend wholly to understand the ramifications of the article. There is no doubt that the long controversy which developed before the present compromise was reached was largely as a result of the powerful resistance of certain of our EEC partners, particularly Germany and France, who were obdurate that no compromise was possible in the choice of the law under which a contract would be written when the directive is in operation.
It is, therefore, all the more surprising and commendable that a compromise has been reached against such tough opposition. But I must express concern because the freedom to choose the law under which the contract would be written now appears to be dependent upon the size of the risk.
I echo what my hon. Friend the Member for Hertfordshire, South said. British insurers feel obliged to accept this as the best compromise available, but they are anxious that the threshold above which alone a choice can be exercised should not go on being increased during the remaining stages of discussion on the directive. Ideally, the insurers' interests in this country would like to see the threshold reduced. We should be opposed to raising the threshold further.
I am not clear about one matter. The directive refers to marine, aviation, transport, commercial and industrial insurance. On the face of it that is clear. That allows us to understand the types of insurance to which the threshold will apply. In the draft directive little reference appears to be made to what I

931
shall call the liabilities. Perhaps the greatest opportunity for British insurance to develop within the EEC lies in that sphere. I hope that the Minister will make clear where the liabilities fall within article 4 and whether the threshold conditions to which I have referred apply to liability insurances as well as to those to which more specific reference is made.
I turn to article 13. By hon. Friend the Member for Hertfordshire, South did the same, and I could not help feeling that we had seen the same brief from the insurance interests in this country. It does no harm to repeat the fear of British insurance interests about article 13. This involves our old friend—matching reserves to liabilities in the country in which the risk is written. It is difficult for the British to understand the almost paranoic insistence of some of our partners in the EEC on this matter. In further discussions on the directive, the Minister would be well advised to accept that strict and absolute matching of reserves to liabilities is neither desirable nor essential.
For example, the question of the management of investments within an area in which a risk is written is a qualifying feature. I believe that a relaxation of the strict rules that the Germans and French would like is something that the Minister should be pressing upon our EEC colleagues.
I turn to article 15. I understand the difficulty that hon. Members and the public have in understanding this article, with its references to branches and agencies and third country insurers writing business within the EEC. But certain principles are involved. A brief produced by the insurance industry on the article states that
"if a third country insurer is good enough to have a branch or agency in the U.K., then surely it should be allowed to operate in the other E.E.C. States. Thus we would prefer to go back to the previous text, but if this is not possible then we feel the Article 15 could best be deleted altogether, as this would leave individual Member States free to decide upon the attitude they would wish to adopt to the agencies and branches of third country insurers wishing to transact services business into their countries from another E.E.C. Member State."
I do not imagine that by reading that extract I have cast great additional light on an inevitably abstruse subject. I hope
932
that the Minister will take on board the fact that the insurance industry feels sufficiently strongly about article 15 to make either an amendment going back to the status quo ante or a deletion preferable to the proposal that we are discussing.
I warmly welcome the liberalisation that is implicit in the draft directive. I warmly welcome, too, the breaking of the log-jam which, for far too long, has prevented the British insurance industry from increasingly turning to Europe.
I echo the congratulations that have been offered to Mr. Christopher Tugendhat. There is no doubt that since he became a Commissioner the impetus behind getting insurance moving in the EEC has been considerable. I noticed that in a newspaper interview the other day he said that he would be very disappointed if we did not have a complete Common Market in insurance by 1980. I cannot help feeling that in view of what has happened in the past, that is a little optimistic, but I imagine that most hon. Members will join me in hoping that at the earliest possible moment we can create a truly free market for insurance in Europe.
8.21 p.m.
Mr. Ernest G. Perry: It gives me great pleasure this evening to join hon. Members on both sides of the House in welcoming to some extent the directive. I suppose that the insurance officials of the Department of Trade have put a great deal of work into trying to iron out any difficulties that exist over differences between the way that we conduct insurance in this country and the way it is conducted on the Continent. I, too, believe that we owe a debt of gratitude to the officials in the Department who have negotiated these terms. We are particularly grateful to Mr. Christopher Tugendhat, who has represented this country in the Commission.
In insurance Britain is pre-eminent in the world. We have something to offer Europe, and that is why so many countries in Europe are trying to impose restrictions through the terms of the directive. The insurance expertise and knowledge of this country has been built up over hundreds of years. If by 1980 these regulations have become effective, the British insurance industry will render

933
to Europe the finest insurance service any country can give.
There are a number of points about which we should be most careful, and one concerns article 4 and the threshold. In future negotiations we must keep this threshold at least as low as it is now. At no time must we agree to an increase.
Article 8 requires special authority or authorisation from the Government of the country in which an insurance company intends to operate. If there is to be unanimity in the Common Market, I do not see why there should be the need for special authorisation. Plain authorisation is all that should be required.
On article 13, I believe that the matching resources and the establishment of huge funds in every country in Europe should no longer be required. We should stick our necks out on this matter and tell the Community that this is just not on.
The British Insurance Association, which represents all the insurance companies and pension societies in the country, is the expert body to which we should all look. We expect from the association guidance on what is best for our industry. In 1980, when I shall no longer be in this place, I hope that the House will ensure that our industry gets its full shale of opportunities to develop in Europe.
I regret that my hon. Friend the Member for Thornaby (Mr. Wrigglesworth) is no longer present. He is, I know, serving on the Finance Bill Committee and he is having to be in two places at once. He has asked me to apologise on his behalf to the House for his absence. I wish to reiterate what he said. I am worried about what may be proposed for the big British insurance societies and companies which operate in practically every sphere of insurance, from the general to the life business. We are concerned in this directive with non-life business. If there is ever any attempt to try to break up our enormous insurance companies—I am thinking of the Prudential, the Pearl, the Co-operative, the London and Manchester and all the large companies which transact all types of business—into a large number of separate companies each to conduct one aspect of insurance, we should resist that to the utmost.
934
Our insurance companies, which have been transacting every type of business for 150 years, should not have to change their style of business in order to fit in with some countries which, to put it bluntly, do not understand the world insurance industry as the British insurance industry does.
We all welcome this directive. It is most agreeable this evening to have something from the Community on which there is unanimity in the House and on which the serried ranks of the anti-Marketeers, who will oppose anything because it comes from Europe, are not present. The directive is the greatest fillip that the British insurance industry has had for a long time. I only hope that we may take full advantage of it in order to show Europe that we have the finest insurance industry in the world.
8.28 p.m.
Mr. Paul Dean: I agree very much with what has just been said by the hon. Member for Battersea, South (Mr. Perry) about the insurance industry and the directive. I am bound to say that I had forgotten that the hon. Member intended to retire at the end of this Parliament. We shall all miss his contributions on insurance and other matters and, indeed, his friendship in the House.
Like my hon. Friend the Member for Brentwood and Ongar (Mr. McCrindle), I declare an interest in insurance matters, and I add my qualified welcome to the directive. It is a qualified welcome for a number of reasons, the most important of which is that, in spite of efforts on the part of the Government and many other people, progress has been painfully slow. In many areas of the EEC in which our competition is somewhat weak, we have seen things being introduced much more quickly. Here is an area in which the British insurance industry is in the forefront of the world, but it is an area in which one cannot disguise the suspicion that some of our partners within the EEC, knowing the effective competition that would come from a common market in insurance, are dragging their feet.
One of the messages which I certainly suggest should go out from the House tonight is that we are dissatisfied with the progress that is being made. One of the intentions of the debate is to strengthen

935
the hand of Her Majesty's Government in trying to ensure that progress in the future should be quicker.
In the explanatory memorandum from the Secretary of State for Trade, I notice that it is said of the text of the directive:
"It may be submitted to the Council of Ministers for adoption in the latter part of 1979."
That simply is not good enough. One of the things that the House of Commons—in every speech that has been made so far this evening, I think—is saying to the Minister is that this progress is not satisfactory, and we hope that the House of Commons is strengthening the Government's hand to try to ensure that speedier progress is made.
My other main general criticism concerns the growing fear in the industry, a fear which I certainly share, that we are going in for far too much detail in this and other directives and that we are beginning to depart from the essential element of flexibility and freedom which has characterised legislation on insurance matters in this country and is one of the reasons why British insurance has made such an effective mark throughout the world.
I beg the Government—I was glad to hear the Minister making this point—to go all out to retain that element of flexibility which has stood our insurance industry in such good stead in the past. I fear that there are some indications from this directive and others that the Continental tradition, which is for much more detailed regulation, is beginning to creep into this and other directives. I hope that this tendency can be resisted.
Those are my two main regrets about the general approach and the timing of the directive. Having said that, however, I welcome it, as other hon. Members have done, as a step towards a common market in insurance, albeit a modest step. I particularly welcome the principle, which appears to be enshrined here, that insurance services provided should be governed by the legislation of the country from which the service is provided. As I understand it, this means that a United Kingdom insurer will be able to cover a risk in any EEC country from London and be subject to United Kingdom legislation. This is a very important principle
936
to get established. To use the jargon in the trade, it is the concept of head office control.
Having given that welcome and expressed those qualifications, perhaps I may very briefly underline some of the particular criticisms made by my hon. Friends the Members for Hertfordshire, South (Mr. Parkinson) and Brentwood and Ongar and by Labour Members. I want to refer briefly to two articles—articles 13 and 15.
I was very glad to hear the Minister refer, when he was making some critical remarks about article 13, to the importance of retaining flexibility. I entirely support what he said about that. Article 13(2) refers to the technical reserves being covered by equivalent matching assets. Many criticisms have been made about this from both sides of the House. A recent experience with another directive which was recently passed by the Council of Ministers gives concern that this article will cause the introduction of strict and absolute matching requirements. That would be quite unacceptable to British insurance. The rules relating to the matching of assets must take proper account of all practical considerations, including the need for efficient management of investments and the true significance of exchange risks.
Rightly, British insurers would like to see article 13(2) amended to indicate that, while technical reserves shall be represented by matching assets, relaxations to this rule should be granted by the supervising authorities in the individual member State. That seems to me to be a reasonable element of flexibility on which the Government would be on very sound ground in taking a strong stand.
On Article 15 I merely reiterate the points already made. I believe that the insurance industry is right in saying that the present text is a step backward and that it is not as good as the original text. If it is not possible to go back to the original text, I agree that it would be much better to delete this article altogether and to leave the matter in the hands of the individual States.
I hope that the debate has strengthened the hand of the Government as regards timing and in trying to preserve the essential flexibility which has been one of the strengths of the British insurance

937
industry. I hope that it will also strengthen their hand in the specific but very important detailed points which have come in unison from both sides of the House.
8.38 p.m.
Mr. Roger Moate: It will not come as a surprise to the House if I introduce a dissenting note into the debate. I have been rather surprised by the immense amount of gratitude bestowed on a variety of people. It has been expressed to the Commission, to Mr. Christopher Tugendhat and even to the Minister—for what? I do not believe that the British people, either today or in the future, will really feel any great benefit from this directive.
My dissenting note is one not of opposition but of total scepticism to the directive. I think that many hon. Members have been guilty of slight exaggeration in describing it as a great step forward, or in seeing it as a great opportunity to create a common market in European insurance. Listening carefully to the debate, one has detected in almost every speech criticisms of the directive that undermine the very case that hon. Members were welcoming. The criticisms that the Minister made, rightly, of the directive have been reinforced by almost every other speaker, and they are at total variance with the desire to have a free market in insurance. If some of these articles go through in their present form, the status quo will continue to prevail and we will not have taken a step forward.
My criticism is on a much broader base than that. When we were arguing about membership of the EEC, it was said by many people in the insurance profession that there were great opportunities in Europe for British insurance. I was sceptical of that claim, and I think that the lack of progress of British insurance in Europe so far—although the time scale has not been long—has borne me out.
Nevertheless, one of the features of our membership that I welcome is the freedom of provision of services, the free movement of capital and the free trading elements that, certainly in financial matters, come through.
If one were talking simply about a genuine common market in insurance, in principle I would welcome that. The London insurance market has become the in-
938
surance capital of the world because of our free trading approach to insurance. Paradoxically, that supremacy in world insurance has arisen because of the protectionist nature of other countries. It is because France, Germany and other great industrial nations have had such a restrictive and narrow approach to their insurance business that they have not offered us competition around the world. It is because of that that London has been able to secure an immense amount of the reinsurance business that is derived from those fairly small national businesses.
If one succeeded in breaking down the restrictive approach of such countries, it would not necessarily work to our benefit. It could work to our detriment. We have benefited from the narrow-minded attitude of some of our Common Market partners. I am more concerned to ensure that London remains the insurance capital of the world than that we manage to put up our share of the European market from 11 per cent. to 15 per cent. or 20 per cent. We must be sure that we do not jeopardise our position in world trade terms for the sake of improving to a small degree our share of the market in Europe.
I thought that I heard my hon. Friend the Member for Brentwood and Ongar (Mr. McCrindle) agree.
Mr. McCrindle: How does my hon. Friend know that it would be a small increase?
Mr. Moate: I shall return to that point. There is ample evidence to show that it is unlikely to be a great amount, judging simply by the attitudes adopted by other members of the Common Market. I cannot see that they will allow great inroads to be made into their domestic markets.
If article 13 were accepted in its present form it could damage our position with third countries who are not members of the Community. It could result in restrictions being imposed upon British insurance in the United States or in other countries. We must avoid that danger. There has been total unanimity on that point.
My scepticism is on a broader basis. A case has not been made out for saying that we will gain enormous benefits from membership of the Common Market in terms of the London insurance market.

939
The principles enunciated in the preamble to the 1976 directive are fundamentally wrong. On page 15 it says that
"Whereas it is necessary to develop a European insurance market …"
—it is not necessary, though it might be desirable—
"due in particular to the steady increase in the size of risks to be covered."
That is not true, because we do not need to have an insurance common market simply to cater for the increase in size of industrial risks. London has always managed to provide remarkably fine facilities for other nations which have not got sufficiently large insurance markets. This is where London has scored handsomely by being able to create international facilities here that could cover ever-increasing industrial risks. The size of the risks does not justify this directive. The fundamental reasons for it are not evident.
The directive is pretty unsound. It will not achieve very much. However, it might not do too much damage as long as we can have the amendments to which the Minister referred.
Article 13, requiring that
"These reserves may be located in the Community without territorial restriction. They must in all cases be covered by equivalent and matching assets"
is a dangerous proposition. I was glad to hear the Minister state that the Government will oppose it. I hope that he realises that he has the backing of the House in his efforts in that direction.
The provisions of article 15 concerning the way in which we deal with third countries could be very damaging to our position in the world insurance market. People often fail to understand how significant is the London insurance market, not just as a powerful base for British insurance companies but as a genuine international market. There is no other place in the world with such a concentration of large commercial institutions, from almost every other nation. An insurance broker in London could walk around the City and, within hours, get hundreds of names of different insurance companies from all over the world that have come to London because of the immense commercial advantages. We must not jeopardise that.
940
I agree with the Minister that if Britain, as the authorising authority, has authorised those companies to trade in London, it should be adequate for them to be authorised to trade throughout the EEC. I hope that we can have that established as a principle and I trust that the directive would not be approved unless such a concession could be secured.
The Minister referred to article 3 and said that the Government were opposed to its implications for taxation. I had not noticed those implications, so I looked quickly at the article. I presume that the Minister was referring to paragraph 4, which contains the only reference to tax. It says that
"The reserves referred to in this Article shall be disregarded for purposes of calculating the solvency margin and shall be under exemption from any liability to tax."
The House should be cautious about allowing the EEC to dictate taxation provisions to our insurance companies. I hope that the Minister will resist any such intrusion on the taxation powers of this country.
Article 14 also deals with taxation and imples that there is a commitment to harmonisation of indirect taxation on insurance. Are we simply to accept that proposition without debating it further? Are we committed to it? We should have an explanation from the Minister. The article says that
"Without prejudice to subsequent harmonisation of indirect taxes on insurance, all insurance contracts concluded by way of the exercise of freedom to provide services shall be subject solely to the relevant taxation in force in the Member State in which the risk is situated."
For the time being, the position is satisfactory, but alongside article 14 are the words:
"Pending the subsequent harmonisation of indirect taxes on insurance".
This trespasses on the whole question of powers of taxation between this country and the EEC, and we must have an explanation on the point.
I welcome the Minister's powerful reservations. There has been general agreement that he is right and the House is behind him in the negotiations. Contrary to the general, almost enthusiastic, welcome that has been given by other hon. Members, I regard the directive as being more in the realm of pious hopes

941
conceived out of the Brussels bureaucracy and being almost incomprehensible gobbledegook in its 50 pages of paperwork. However, no harm will be done if we can secure the amendments to which the Minister referred.
8.49 p.m.
Mr. Hugh Dykes: My hon. Friend the Member for Faversham (Mr. Moate) and other hon. Members are right to raise the objections which they have raised. Where my hon. Friend is wrong, but where we have long since abandoned all hope, is in his practice of transmuting those detailed objections, on which I share his anxieties, into a generalised objection to the document because it is an EEC instrument. That is because of his usual opposition to our membership. It is a continuing mistake, but he is entitled to make it and his views are well known. Those views are not shared by most hon. Members, as repeated votes have shown. What is unanimous in this debate, even grudgingly from my hon. Friend, is support for the draft directive.
Most of the detailed of objections have related to article 13. I share the substantial concern expressed about the excessively rigid approach, which is often seen among Continental authorities governing insurance functions, to the need for an excessive reserve stipulation. It is unnecessary. It perhaps reflects the precarious position of insurance companies in those countries many years ago but it is no longer realistic, even for them, and certainly not for the British insurance companies with their long history of safety, experience, investment sagacity and insurance risk-writing wisdom in general.
I hope that the Minister will be armed to the teeth with all these objections and will return to the negotiations on this document—it has taken a long time, but this is a complicated business—with a strong negotiating position, seeking to get full justice for the British industry. I am sure that the House welcomes the directive as a practical example of the Community working positively and sensibly, despite some enormous difficulties and differences, for the good of the Community itself and for that of each member State.
Some of the media in this country have indulged in familiar anti-EEC
942
noises. The Daily Express at the beginning of the week ran a feature saying that the housewife wanted to come out of the Community. I do not believe that there is evidence of that. When the British public is fairly presented with concrete examples of the Community's sensible working and of the progress that it makes, even if it is as slow as with this directive, the housewives and their husbands will see that there is much in the Community to commend it and to give greater prosperity in the long term to all its citizens.
As the months pass, general attacks on the EEC will be applied to the particular and to everything which comes from the Community, including this directive—if the Daily Express thought that enough of its readers would read about it. That is unlikely; it must stick to the emotional material and not get into the technical stuff, which might bore its readers. That is the general attitude of newspapers like the Daily Express. I recall with affection an emotional headline in the mid-fifties—it will be claimed that it is apocryphal, but I am sure it is true—which read:
"English student killed by German thunderstorm".
We see now a recrudescence of that attitude not only to the EEC but to all foreigners.
So far as correspondents of the Daily Express have the courage tomorrow to read a debate like this, which will show them what the EEC means more than will the emotional anti-foreigner tirades in which that paper will indulge in the coming months, I welcome not only the particularities of this debate but its generality as well.
8.55 p.m.
Mr. Clinton Davis: The caution that I would utter to the hon. Member for Harrow, East (Mr. Dykes) is that he tended to be a little too euphoric about the benefits of the Common Market. It is that euphoria which perhaps made a little disreputable some of the arguments in the membership debate. However, my view about that at that time is fairly well known.
It is interesting that people who were such worthy protagonists of the Common Market are urging me to take a very tough line about our Community partners. I welcome that. Indeed, that was

943
the purpose of the debate, and I anticipated that they would be wanting to urge that course upon me.
The hon. Member for Faversham (Mr. Moate) has, perhaps, been dealt with a little unjustly by some if his hon. Friends. He is quite capable of defending himself and he does not need me to do that for him. I know that he has no intention of being killed by an EEC thunderstorm. If he is to be killed in that way, he will be killed by a British or Commonwealth thunderstorm. That is for sure.
The interesting feature about the debate is that, whatever one's basic views have been about the Community, the history of entry and so on, there has been very strong advice—advice which I sought—given to the Government by both sides of the House on a number of important issues.
The hon. Member for Hertfordshire, South (Mr. Parkinson) made an extremely thoughtful speech in going through a number of anxieties that he had. He made the point—I also referred to it, although not in quite as much detail—that it was regrettable that our insurance industry, which is a worthy, highly competitive and efficient industry, had, for reasons that were not within its control, not been able to break into Europe to the degree that was desirable.
The industry does not seek in any way to get any unfair competitive advantages. It is not seeking to take a sort of Eastern bloc or Russian shipping approach in this matter. I say that because I have spent hours in Luxembourg discussing that question, and it is still residing with me. That is not the approach of the insurance industry. It wants to compete on totally fair terms. So far, that opportunity has been denied to it, at least in part, and it is regrettable.
It is against that background that the progress which has been made in the directive is significant. That is why it is welcome. But there is much negotiation still to be undertaken before we can view the position with complete satisfaction.
The hon. Member for Hertfordshire, South echoed many of the criticisms that I had made in my earlier speech. He said in particular, in relation to article 4, that the thresholds should in no circumstances
944
be raised. That view was also mirrored in a number of other speeches that we heard. The hon. Member argued also for an extension of the principle of freedom of choice in law.
The argument about thresholds is very important indeed, and I take very strongly into account the advice which has been proffered today. I think that it would be deleterious to the interests of our industry if there were any question of raising the thresholds. We are not happy about the present level, and we are arguing, therefore, for a reduction.
I think that the fact that it seems to be common ground on both sides of the House that the Government should continue to negotiate along those lines is bound to be positively helpful. I cannot, of course, guarantee the success of the negotiations. However, I hope that those voices will be listened to where it matters—where the negotiations are undertaken. I believe that the voice of the House of Commons is, in fact, paid attention to by those on the other side of the argument.
Another point mentioned by the hon. Member for Hertfordshire, South and by a number of other hon. Members related to the doubts about the question of liability insurance and how this featured in the whole argument. One of the questions which was basically being asked—here I am trying to summarise the points made by a number of hon. Members—was as follows. Should liability insurance be given the same degree of freedom of choice in contract law as marine aviation and transport insurance? That was one of the underlying questions that was posed. We certainly take the view that it should. Liability insurance shares the international character of these other classes of insurance. Our partners are currently examining a paper, which we put round, suggesting that liability insurance should be given the same freedom. Logic points wholly in that direction, but logic does not necessarily dictate the result of negotiations.
Or, again, should freedom of choice of law provided in article 4 be limited only to policyholders with the status of a trader? That is not a point which was made, but it is a fair point which we ought to pose. As it stands, this limitation is not satisfactory because it excludes policyholders who are engaged

945
in professional activities. We are confident that we have a reasonable chance of being able to negotiate a satisfactory definition so that such people will also benefit from these provisions.
The hon. Member for Hertfordshire, South, together with others, went on to take up the remarks that I had made about the inadequacies—indeed, the undesirability—of the rigidities set out in article 13. He said, as did others, that reserves to be covered by matching assets injected what amounted to an unrealistic position. I think that it is unrealistic. It is much too inflexible. For that reason, we are opposed in principle to article 13(2).
Mr. Dykes: Following his earlier remarks, does the Minister agree that since the industry itself in this country has, we understand, proposed a very pragmatic and gentle compromise—namely, that discretionary authority by the national governing authority to relax the rule, even for temporary periods, is quite adequate in this context—outright opposition to this article is not in that sense necessary?
Mr. Davis: To use the expression of the hon. Member for Faversham, I am a little sceptical about that. Anyway, I do not think that it would be very helpful from the point of view of negotiating posture if I were to agree with the hon. Gentleman, which I do not. He says that the industry has taken that view. Perhaps he is aware of evidence of which I am not. I think that it is an illogical state of affairs and one to which we should object in principle. The hon. Gentleman and I may choose to differ, but that is my point of view.
Perhaps I ought to say a little more about this because I think that the hon. Member for Hertfordshire, South really put his finger on it. The example that he cited was very pertinent. It can get insurance companies into all sorts of difficulties if we pursue that sort of line. The sort of difficulty in the application of the matching rule without any degree of flexibility is that the practicalities of the operations of an insurance undertaking are necessarily ignored. They are not ignored in every respect, but they are in major and fundamental respects.
Amongst the most specific reasons why we have opposed this absolute rule are,
946
first, that it is impossible to operate for classes such as marine, aviation and transport and liability insurance where the eventual claim may occur in any currency; secondly, if any small amounts of business are written by a company, it may be very difficult administratively and may be unwise financially to hold small packets of currency; and, thirdly, a company must have an opportunity not to speculate but to invest its funds wisely from the point of view of investment income. For those three reasons alone, the arguments which have been adduced by hon. Members are right.
The hon. Member for Hertfordshire, South went on to refer, as did others, to article 15. He and virtually everyone else who referred to its had the strongest reservations. He referred to the artificial distinction between branches and subsidiaries in third countries, and so on. I do not wish to go further than to take note of that. I invited hon. Members to comment on the matter. We have not made any final judgment, and the comments made tonight have been of considerable help to us and will be taken into account.
My hon. Friend the Member for Thornaby (Mr. Wrigglesworth) raised a number of matters. Unfortunately, as he said, he is engaged in the Finance Bill Committee, and we understand why he cannot be in the Chamber to hear my reply. He was concerned primarily about the position of the composite company, and I know that representations have been made to him by the CIS. He was good enough to refer to the correspondence I had with him. On 16th May last year I wrote to him on this very matter. I know that he is concerned about this and asked me to give him certain definite assurances. However, it is not directly relevant to the matter that we are immediately discussing although I understand why, since we are referring to some extent to composites, he thought it right to present a marker to the House about the matter.
We are undertaking a review, and I think that it would be wrong at this stage to prejudice the results of that review. I recognise, however, that any changes from the present system could have very serious and important implications for the CIS. My officials and the

947
Registrar of Friendly Societies will consider carefully any problems which may arise from this position. I am in no way making concessions, but obviously we have to take account of possibilities and consider future options. Any problems which may arise will be considered carefully, and I suggest that the CIS discusses with my officials the issues involved.
However, perhaps my hon. Friend will be able to take some comfort from the fact that the matter is not likely to be finalised for several years, during which time I hope that a satisfactory formula can be found for erasing the anxieties which he indicated. I do not accept the point that my hon. Friend has sought to make that the review itself admits of the possibility of destruction of composites. That is going too far.
The hon. Member for Brentwood and Ongar (Mr. McCrindle) made a number of points to which I have already referred. He referred to article 4 as a lawyer's paradise. I can think of better lawyers' paradises than that. However, I see his point in trying to comprehend article 4 myself, as a layman to some extent in this field.
The hon. Member reiterated the point about thresholds, to which I have referred. He also referred more specifically to the question of liability risks and the freedom for transport liability where the insured is a business man and the risk arises from the business. In those circumstances I understand that no threshold limit applies. That refers to Article 4(2)(b). In article 4(2)(c) there is freedom for liability associated with a general, commercial or industrial fire or accident risk where this is above the threshold limits
Mr. McCrindle: I know that the Minister is trying to be helpful in response to my inquiry. I do not expect him to respond to my point straight away, but perhaps he will write to me. I am especially anxious to know the position of a British insurer wishing to transact a liability business where there is no associated marine, industrial or commercial risk. What is his position under article 4 of the draft directive? If the Minister cannot answer now, I understand, but I hope that he will take account of the
948
point. I was trying to separate the situation which he has just described from the situation in which only liability insurance is involved.
Mr. Davis: I am glad that the hon. Member has offered me an avenue of escape from answering such a complex question now. I do not think I can do it justice at present, so I shall avail myself of this escape route, take advice and write to him as soon as possible.
The point was made by the hon. Member for Hertfordshire, South and was reiterated by other hon. Members about article 15 who claimed that it would be better, if one could not go back to the original text, to scrap the whole thing altogether. I listened to their arguments, I have taken note of them, but I cannot go beyond that now.
My hon. Friend the Member for Battersea, South (Mr. Perry) has made many contributions to debates about insurance over the years—long before I became a Minister. During the time I have been a Minister, I pay tribute to his constructive role in insurance debates, except for those on the Policyholders Protection Bill. I think on that occasion I was proved right. I should like to take up the comments of the hon. Member for Somerset, North (Mr. Dean) about my hon. Friend the Member for Battersea, South. We shall miss him from our councils on this matter and on many others, both inside and outside the Chamber. He has been a good friend to many of us, and particularly to me as a fellow London Member. I have had a lot of advice, help and guidance from my hon. Friend and I am still relatively youthful in this House.
Mr. Parkinson: Is the hon. Gentleman retiring soon?
Mr. Davis: No, he will not be going for another 18 months.
The hon. Member for Somerset, North speaks with great knowledge about these matters and made a fair point, but I think he did not answer the matter in his arguments and did not apply his mind to answering it. He said that the influence of some of the directives was aimed at increasing rigidity whereas in the United Kingdom we wanted to retain flexibility. I agree with that principle absolutely. However, we are living not

949
in an ideal world but in a world where, if progress is to be made, one has to compromise between different philosophies.
I do not speak from the same standpoint on the EEC as do a number of hon. Gentlemen who have contributed to this debate, but if we apply this argument pragmatically I believe that it is to the advantage of the insurance industry to achieve a common market in insurance as quickly as possible. In order to do that, compromises have to be achieved. Although I accept the point in principle, I believe that it would not be possible to retain to the full the degree of flexibility which we should all like to see.
The hon. Member for Faversham expressed scepticism about the directive and the thinking behind it although, having given vent to his views, he gave the directive a sort of welcome. I do not complain about a degree of scepticism when one is negotiating. If one goes into negotiations without a fair degree of scepticism, as I learned as a solicitor, one's client has not a chance. It is right that such an attitude should be displayed, and I take many of the hon. Gentleman's points. However, ultimately he came round to many of the same conclusions as were reached by other hon. Members.
The hon. Gentleman asked a very important question on article 3 and also on article 14, concerning taxation. Article 14 reads:
"Without prejudice to subsequent harmonisation of indirect taxes on insurance, all insurance contracts concluded by way of the exercise of freedom to provide services shall be subject solely to the relevant taxation in force in the Member State in which the risk is situated."
I am advised that there are no discussions or proposals about harmonisation in this respect. It is a phrase which has been imported into the article with a sort of reservation. It is without prejudice to the possibility of the situation arising, but as yet there has been no discussion about it. I hope that the hon. Gentleman will accept that point.
Mr. Moate: Would the directive lose anything at all if article 14 were omitted? Judging by the way the Minister has described the matter, and if there is no commitment to subsequent harmonisation, if there were no article presumably the present position would remain and all contracts would be subject solely to the
950
relevant taxation in force in the member State.
Mr. Davis: The hon. Gentleman makes a fair point. I do not know what has gone into the discussions behind this article in detail, and I am merely responding to a point he made in the debate. I took specific advice about whether there had been any commitment. I am assured by those who have been involved in the negotiations that there is not. Perhaps the article is fairly meaningless, and maybe it is as well to leave it in that way.
The hon. Gentleman made one point with which I disagree. He said that he could not see how our partners in Europe—I know that he does not like that term, but I use it—will allow great inroads into their markets. The directive as drafted gives freedom for a whole range of risks that I listed in my opening remarks. The directive would be a major opportunity for our industry. Other States have made concessions and we have had to make some. In fairness, the action of other States should be recognised. The proof of the pudding will be in the eating.
Mr. Moate: My point was on taxation. The hon. Gentleman referred to his own reservations on article 3, which is a different aspect of taxation. The hon. Gentleman has not commented on my point, which I imagine to be a fairly important negotiating matter.
Mr. Davis: I dealt with that matter at some length in my opening remarks. Repetition does not improve the argument. I have already indicated my feelings on the matter to which the hon. Gentleman refers.
I know that my hon. Friend the Member for Grimsby (Mr. Mitchell) has been waiting in the Chamber for the opportunity to address a full House on the Adjournment. I thank hon. Members for their participation in the debate. It has been a wholly helpful debate, and I hope that it will give great encouragement to those of my officials who will now embark once again upon difficult and delicate negotiations.
Question put and agreed to.
Resolved,
That this House takes note of EEC Documents Nos. R/95/76 and R/467/78 on Non-Life Assurance.

TUNNEL VISION
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Tinn.]
9.22 p.m.
Mr. Austin Mitchell: If I had wanted to grab the headlines or address a packed Chamber, I should not have called for a debate on retinitis pigmentosa. It is not a phrase that trips from everyone's tongue. In my experience it is a phrase of which people fight shy. Those to whom I have mentioned it today have automatically and wittily replied "You what?" or "Say that again". That is a reaction that I am sure accounts for the tumultuous attendance for the debate. If it had only been known that it was about tunnel vision, I am sure that the Chamber would have been packed.
First, I define my terms. Retinitis pigmentosa is a group of diseases whose common feature is a degeneration of the light-sensitive cells of the retina. It is a deterioration that shows itself first in bad vision, impaired vision, loss of vision in dim light, such as in the dusk or in the dark, and goes on gradually to loss of peripheral vision, so that merely the central portion of the visual field remains. That is the tunnel in the phrase "tunnel vision". It is a tunnel which all too tragically can close, resulting in complete blindness in the severest cases.
Between 10,000 and 25,000 people are afflicted by retinitis pigmentosa—between two and five persons in every 10,000 of the population. It is a progressive, degenerative inherited disease. It is not something that one just catches. Apparently it is a Northern disease. It seems to be more common in the North than in the South. There is, for instance, a high incidence of retinitis pigmentosa in Tristan da Cuhna, because of inbreeding in the population. I do not know whether that explains the high incidence in the North, but it is a feature of an inherited disease, and because it is inherited there is no way of escaping it. That is the beginning of the tragedy that it poses for families throughout the country.
The disease is often difficult to diagnose. Its victims appear awkward rather than blind. They stumble in dim light. They bump into things that are on the edge of their field of vision. In most cases,
952
however, they can still read. They can still see perfectly well at the centre of the tunnel. Therefore, missed diagnosis of the disease is all too common.
I have a letter from a Mrs. Hoden, of East Herringthorpe, near Rotherham, that sets out a tragic example of the sort of misdiagnosis that may occur. Her two girls, who suffer from retinitis pigmentosa, were diagnosed as mentally backward, because of the effect of the disease on their ability at school. Their clumsiness at night was put down to the same thing. A boy who suffers from retinitis pigmentosa was classified as ineducable. These children should have been treated in a special school for impaired sight, not intellectual ability. They are now in that special school, but only after what amounted to years of delay because of misdiagnosis.
Even sadder is the fact that if retinitis pigmentosa is diagnosed, the victims all too often have to be told that in the present state of medical knowledge little treatment is available in this country. Therefore, when the disease is diagnosed, all they can do is to wait for the results of research that is going on in this country and overseas. They have to wait for the development of new methods of treatment to replace the old discredited methods of vitamin injection and placenta implantation—methods tried in the 1950s and 1960s—while going slowly, irrevocably and sadly blind.
It is hardly surprising that people are not prepared to wait. People faced with the negative despair produced by this disease and with the lack of opportunity for treatment in this country are naturally and inevitably prepared to clutch at any straw, any prospect of hope, that the disease can be not necessarily cured but checked, so that the progressive deterioration can be stopped. Therefore, they turn to hope emanating from overseas, specifically from Switzerland and the Soviet Union. They clutch at the hope offered by treatments there, because that offer of hope is not available in this country.
I have a letter from Professor Bangerter, the head of the Opos Eye Clinic in St. Gallen, Switzerland. His English is not of the best—like mine—but he says:
"The letters, we got from England, are so numerous that one of our secretaries is nearly completely engaged in answering them. The

953
balance of these letters is extremely oppressing."
He is deluged with letters from people in this country who want help.
Inevitably, faced with the prospect of the steady loss of their sight, their friends, neighbours and acquaintances who do not want them to go blind are prepared to offer help. Therefore, appeals are made in different parts of the country, particularly in the North, to raise money to send these people to Switzerland, more commonly, but also to the Soviet Union, for treatment.
The figures for these appeals make instructive reading. I have heard of £22,000 being raised in an appeal in Liverpool for one family—the West Vale family fund. In Retford, £11,000 was raised for a girl called Shirley Dexter. In Sowerby Bridge, £6,000 was raised for Tracy Brown. In Keighley, £4,500 was raised for Garry Turton. In Grimsby, £2,000 was raised for Sid Owen. I read them in that order, but that league table of figures is not necessarily a league table of generosity in those places. If it were, Grimsby would certainly be at the head, not the bottom, of that league. Those are the kinds of appeals which have been launched and subscribed to all over the country. The list goes on.
The result is that people are being treated in Moscow, but more commonly in Switzerland. The numbers being treated in Switzerland must run into hundreds, possibly thousands, because of the period during which the Opos Eye Clinic has been carrying out treatment. I understand that last week, at St. Gallen, nearly a score of British people were being treated at the clinic. They included a family of 13 from Liverpool, seven of whom were being treated in the clinic for retinitis pigmentosa.
I hold no brief for either of these treatments. A British expert from Edinburgh University, Dr. Reading, attended a USSR national symposium last December. He came away unconvinced that the Russians had made any advances in treatment. Dr. Bangerter, the founder and head of the Opos Eye Clinic, is regarded, even in his country, as a fringe figure.
If I wanted to set myself up as a confidence trickster with the happy prospect of receiving large sums of money I could think of nothing better than to open an opulent clinic in Switzerland with large
954
numbers of patients so desperate for help and treatment that they would be prepared to fork out £700 a time for treatment and to come back every three months for further treatment and, once the initial treatment was over, to come back every year for further treatment to stop the deterioration of the disease. Such people would be prepared to pay out £10 for a box of vitamin pills, and even pay for sitting in the waiting rooms. I heard of a lad who went by himself because his money was in short supply, could not find his way round the town, and was charged for sitting in the waiting room of the clinic.
This situation naturally produces suspicions. Those suspicions are amplified because Dr. Bangerter has never published facts to show the success or failure rate of the treatment. People will continue to go to Switzerland and the Soviet Union to pursue any available treatment, so long as that treatment holds out a hope which is not available here.
When they return many such people claim that their sight has been improved. They do not say that they have been cured. Some newspapers have highlighted claims from people who say that they have been cured by this treatment, but no such claim has been made by the Russians or the Swiss. The most that I have seen claimed by the Swiss is that they can retard considerably the progress of the disease or stop it over a long period. There is no claim of a cure. The claim is of stopping the progress of the disease. People do return and say that their sight is improved.
One would need a national survey to discover total figures. I talked to Sid Owen, from Grimsby. He has not had the full treatment, but he says that he can now read better than he could before. I have spoken to Garry Turton, from Keighley, whose specialist has commented on the increased activity in his eye. I talked to the parents of Tracy Brown, of Sowerby Bridge. They say that her condition has been improved by treatment at St. Gallen. I have also spoken to two others.
I cannot evaluate these claims. All that I can do is to report that such claims are made. They could mean something or nothing. There are examples of spontaneous remission, and that could be

955
associated with the treatment. It could be anything. It could be hope, desperation, and confidence exuded by the Swiss clinic which makes people feel that they have been helped. It is also possible that having spent all the money which has been donated by others, patients will not admit that there has not been an improvement. Perhaps they claim an improvement to support those who have backed them.
The claims of improvement which are made by those who have been to Switzerland for treatment have not been professionally evaluated. The reason for that is that in son-le cases the patients have broken with their specialists, who did not wish them to go to Switzerland. In other cases the doctor or specialist did not wish to know about the treatment. There is no collective evaluation to give us a picture of the incidence of the disease being checked. There has been no attempt to follow up the hundreds of people who have received treatment, and continue to do so, to find out whether there has been an improvement or deterioration in their conditions.
We have not studied the Swiss treatment on the spot. The Medical Research Council's working party on retinitis pigmentosa did not do this. So far as I know, none of the specialists who dismiss the Swiss treatment has been to Switzerland to look at the treatment, although the clinic would welcome an inspection team. I quote from a letter in Professor Bangerter's classic form of English. He said:
"Personally I do not have any greater desire than to finally find doctors who are ready to join us in the tight against retinitis pigmentosa. So it is quite self-evident that the English team will get any insight and complete orientation"—
this is a typically Swiss note—
"free of charge".
So these people are prepared to open up their facilities for inspection by a team from this country. We welcome that kind of inspection, but it has not so far been forthcoming.
In answering my questions on the subject, the Minister of State has dismissed the Swiss treatment as though it were just a matter of the implantation of placenta of a type done here in the 1950s and 1960s. However, as I understand it, there is in the Swiss clinic a combination
956
of treatments which include injections to expand the vessels in the eye, the contraction of which is associated with the disease, the implantation of amnion from chicken eggs, vitamin and other treatments to check the loss of nucleic protein and, finally, play optics or exercises to expand the field of vision, the contraction of which is a dominant factor of this disease.
If the treatment is to be evaluated at all, it must be evaluated as a collective group of treatments, each element of which might or might not make a contribution, but all of which must be taken together because it is in that way that the patients experience them. Evaluation of this treatment must be carried out, for no one who is afflicted with the disease will be prepared to heed the warnings of doctors and specialists against going to Switzerland for treatment, because no one trusts the judgment of the doctors, and will not, unless it is reinforced by a specific study of the treatment and its results.
One needs positive evidence in order to give positive advice to people who are afflicted by this disease. Whether that advice is pro or contra, it must be based on evidence.
I dwell on the Swiss and Russian treatments because of the numbers of people who are trying to take them up. The numbers who are seeking treatment in Switzerland and the Soviet Union show the scale and desperation of the search by those concerned for some form of treatment—the scale of demand for something to be done to help those who suffer. Clearly, no words in this House will deter those high hopes, but words in this House can add to the demand for an expansion of research into the causes and treatment. They will lead to a demand for a greater concentration of resources on this matter, particularly of money, which here, as in so many other fields, is the key to progress with the diagnosis and treatment of the disease, and the key to success.
More prosaically, we can ask, as I have tonight, for an evaluation of the Swiss and the Russian treatments and of their effect on the people who have taken them. Preferably there should be a before-and-after evaluation, so that we can say with certainty, with authority and

957
with evidence, either that these treatments are no use and that people should not go, or that there may be something to them and, if there is, that they should be developed in this country.
If we do not study the treatments and assess them in this fashion, we are letting down the victims of retinitis pigmentosa—people who are bound, whatever we in this House say, and whatever experts tell them, to rage against the dying of the light.
9.39 p.m.
Mr. J. W. Rooker: I am grateful to my hon. Friend the Member for Grimsby (Mr. Mitchell) for allowing me a few minutes in this short Adjournment debate. Contrary to what my hon. Friend said when he started his speech, this is probably one of the best attended Adjournment debates that has taken place for a few weeks. In any event, it is very useful to have a short debate on the visually handicapped, because it is a subject and a group of people that we do not discuss enough in this House in terms of the treatments that are available, on which my hon. Friend concentrated, and the help that the State can give to people who suffer from a visual handicap.
I want to draw the attention of the House to only a couple of points, but they are extremely important, the more so because the proceedings in Standing Committee on the Finance Bill—which we are not allowed to discuss in detail—took an unexpected turn on 24th May. My hon. Friend the Minister will he aware that the Financial Secretary to the Treasury made a commitment to the Committee on 24th May that on the Report stage of the Finance Bill the Government would be bringing forward a concession in the Bill concerning the visually handicapped. He is reported at column 493 of the Committee proceedings as saying that he hoped to bring something back on Report.
The term "visually handicapped" covers all those who suffer from a visual handicap, whether they suffer from the disease upon which my hon. Friend the Member for Grimsby has been concentrating this evening or from total blindness. Tonight the Minister ought to tell us what the Government are doing in regard to this particular disease. It is
958
outrageous that in 1978, when we have a Welfare State that is advanced as that of any other nation, various groups of people and neighbours of people who suffer from various diseases have to club together and sub around to send people abroad for treatment that ought to be carried out in British hospitals. The Government have recently forked out expenditure to send two Ministers and two civil servants to watch a football match in Argentina—thousands of pounds of taxpayers' money which could easily have been spent on half a dozen operations of the sort to which my hon. Friend has drawn attention. That is an absolute disgrace.
It is not demeaning the subject, of course, to point out that the people who were playing those football games must themselves be suffering in some small way from a visual handicap.
My hon. Friend the Minister ought to address himself to the central issue—the issue that is central in addition to that of the treatment of these diseases. That is the matter of what the State is doing for these people in 1978. For example, why do the visually handicapped not receive mobility allowance? Perhaps the Minister will tell us how many of the visually handicapped in Britain receive mobility allowance. That is a much fairer system than giving them a tax relief or a tax benefit, which, by definition, benefits only the best-off and only those who pay income tax. It does not benefit the visually handicapped person who cannot seek or gain employment and who, therefore, does not pay income tax anyway.
The money that is already spent by the Government on tax relief could be spent on mobility allowance and could be used by individuals. If the Government will not put the treatment of this disease on the NHS, where it ought to be, at least individuals would have the right to spend their mobility allowance or to save it up so that they did not have to rely on neighbours to pay for flights abroad and operation fees in Swiss or Russian clinics, or wherever they have to seek the treatment.
At the minimum, we ought to make sure that these people can afford to get the treatment needed if it is not provided under the NHS. That is not an argument for private treatment. It is an argument

959
for extending the NHS so that everyone in Britain who suffers because of poor health, an impairment or a disability can get treatment free at the point of use on the NHS. If the NHS is not up to that, it is up to the Government to see that individuals have the means to obtain the treatment so that they do not have to grub around among neighbours. The Minister ought to tell us the Government's view on this matter.
The other point to which I draw attention is the other benefits that the State gives to the visually handicapped and those who suffer from retinitis pigmentosa. I should be interested to know whether the sufferers from this disease are entitled to get even the minimum that the State gives to others—that is, car parking under the orange badge scheme. I am not sure whether the Department, in its sometimes callous treatment of the handicapped—though that is certainly not true of the Minister—has included these people within that scheme.
I ask the Minister also to mention abuses of the scheme. If the visually handicapped are to benefit from the scheme—if that is what my hon. Friend is to announce—how will he ensure that those driving them do not abuse the use of the orange badge when using vehicles on their own account? This is important. The question of the visually handicapped covers a multitude of problems, since some of the diseases are incurable, and it behoves the State to make the best possible allowances and conditions for those who so unfortunately suffer from them.
On the other hand, the State has the responsibility to put money into research and treatment so that people do not have to fly around the world seeking treatment which they should be able to get on the National Health Service. I hope that my hon. Friend will make known the Government's plans on this issue as well as dealing with the narrow but important points that my hon. Friend the Member for Grimsby has raised in this very important debate.
9.47 p.m.
Mr. Harry Gourlay: I congratulate my hon. Friend the Member for Grimsby (Mr. Mitchell) on securing this debate on a subject that is of great importance to many thousands of people.
960
I support his demand that more money should be given for research into this tragic disease. A number of my constituents suffer from it—one in particular has been writing to me for several years in sheer desperation because of the publicity given to some of the so-called successes of operations and treatment in other parts of the world, particularly Moscow.
I understand that this constituent has spent hundreds of pounds of his own money trying to secure private treatment from various sources in this country which claim to have produced some results in trying to stop the progression of the disease, but unfortunately in his case it has been of no avail. In sheer desperation he wrote to me not long ago asking whether the Government could find a way to finance a visit by him to Moscow in order to secure treatment there.
This request arose out of the hope, engendered by Press reports, about individuals going to Switzerland and Moscow and returning with some indications that a certain improvement had been made. I hope that the Minister and the Department, in addition to coming forward with more money for research into the problem, will also give more publicity to the true position of the treatment being given in Moscow and Switzerland, and its results, so that persons suffering from this sight problem in Britain will not feel that they have been prevented only by lack of Government funds from having their sight restored.
This is a very important point. When there is Press publicity about one or two individuals who have had the backing of private or collective funds for this treatment, those who have not been so fortunate in getting such assistance feel that they are being denied something. The replies that Ministers have given me about this disease have clearly indicated that the results of the experimentation so far undertaken in Moscow and elsewhere do not give the kind of results in general that one is led to believe. Therefore, if we can get more publicity from the Government about what is happening elsewhere, those individuals will feel that the Government are doing as much as they can about the disease.
My hon. Friend the Member for Glasgow, Maryhill (Mr. Craigen), in a Question in May 1976, asked why research

961
into the causes of blindness, including retinitis pigmentosa, has been halted at Edinburgh University. The reply from the then Secretary of State for Education was:
"I assume my hon. Friend is referring to the research programme at the Medical Research Council's Brain Metabolism Unit, Department of Pharmacology in Edinburgh."
He said:
"The unit's programme does not include research into causes of blindness generally but did include work into retinitis pigmentosa. The Council informed me that this work was discontinued only after careful consideration and because of other more pressing claims on their resources."
There had been research in progress in 1976 which had been halted because of other priorities. Therefore, as a result of the debate tonight I hope that the priority can be restored and that more research will be undertaken into the problem as soon as possible.
While we seek more money for people suffering from this disease, the Government have given unprecedented assistance in the last four years, particularly to the blind section of our population. In terms of cash benefits and service, blind people have not gone unrewarded.
My hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) referred to the orange badge scheme, which has been of considerable assistance to blind people. The hundreds of millions of pounds spent by the Government on blind people are only one indication that the Government take seriously the problem of the blind and of all disabled people, particularly since we were the first Government to appoint a Minister with responsibility for the disabled. We can rightly claim that we have gone far out of our way in order to look after people with all forms of disablement.
I congratulate the Royal National Institution for the Blind on its voluntary work on behalf of blind people in Scotland and other parts of Britain.
I appeal to the Minister to do what he can to see what further funds can be found for research into this tragic disease, so that in the future fewer people will have to fly to foreign lands to secure treatment.
9.54 p.m.
Mr. Robert Hughes: I am grateful to my hon. Friend the
962
Member for Grimsby (Mr. Mitchell) for raising this important topic. Those involved with such diseases have been concerned over many years to try to find a cure. I hope that my hon. Friend the Minister in replying will give us some idea of the incidence of the disease and whether it is increasing or decreasing.
We are glad that progress has been made in reducing the number of people who suffer from diseases of the eye. Fewer young people are being born blind. Fewer people are becoming blind over the years. Many of those who become blind in later years do so as a result of either industrial accidents or road accidents. The number of people suffering blindness as a result of illness is decreasing. This causes some problems in relation to sheltered workshops for the blind, because they are increasingly becoming sheltered workshops for the blind and physically incapacitated. Of course, this is a problem which, in a sense, we welcome.
Mr. Rooker: My hon. Friend is correct, but I understand that of the 25,000 registered blind persons in this country only 10,000 are in employment. There is enormous scope for the rest of the visually handicapped to seek gainful employment in sheltered workshops or outside industry.
Mr. Hughes: I shall not digress too far into the problems of sheltered workshops except to say that, when the economy is in difficulty and there are problems for industry generally, sheltered workshops face the great difficulty of having to compete with outside industry for orders. In addition, there have been great advances in industry in relation to work for the blind and many people who would otherwise have gone into sheltered workshops are finding employment in industry. This is particularly important for blind women who, with the development of the braille typewriter, are able to take normal jobs as shorthand-typists. This is to be welcomed.
I return to what we can do about this disease. Among the suggestions in the paper by Dr. J. Marshall, of the Department of Visual Science, Institute of Ophthalmology, London, is that people who suffer from the disease should carry cards so that when they die, whether in an accident or otherwise, their eyes may

963
immediately be donated for examination There is a great lack of information about this disease. It is said that only 40 eyes have been examined since 1857 when the disease was first identified and only five eyes have been examined under an electron microscope.
The idea of carrying cards is useful, but it is not enough on its own. Our experience of the kidney donor cards leads us to believe that not enough people take the trouble to carry these cards. May I emphasise to people that they should carry a card saying that when they die their eyes may be donated for medical research and that, perhaps more important, their kidneys could be made available to someone who needs a transplant?
I hope that the Minister will continue his work on donor cards in respect of useful organs. Indeed, we could all say to our next of kin that when we die, whatever use some people may feel we have made of our bodies during our lifetime, the whole of our bodies should be donated to medical research.
Since the disease that we are discussing is hereditary, can steps be taken in the genetic counselling of sufferers so that we can try to prevent the disease from continuing? If we cannot cure it, perhaps we may be able to reduce the number of people who suffer from it.
I hope that my hon. Friend the Minister will be able to answer the various points that have been made in the debate, and I congratulate my hon. Friend the Member for Grimsby on raising this subject on the Adjournment.
Mr. Nicholas Fairbairn Mr. Nicholas Fairbairn (Kinross and West Perthshire) rose—
The Under-Secretary of State for Health and Social Security (Mr. Alfred Morris)The Under-Secretary of State for Health and Social Security (Mr. Alfred Morris) rose—
Mr. Deputy Speaker (Sir Myer Galpern): Mr. Alfred Morris.
9.59 p.m.
Mr. Morris: It is customary for Ministers replying to debates on the Adjournment to thank the hon. Members who initiate those debates. I want to make it clear at the outset that my gratitude to my hon. Friend the Member for Grimsby (Mr. Mitchell) for raising the subject of retinitis pigmentosa is more than formal. He takes a genuine and
964
abiding interest in the problems of handicapped people and has, for a considerable time, shown a deep and sympathetic concern both for sufferers from this distressing disease and for their families. His concern was well reflected in his speech tonight and I much appreciate this opportunity to examine and discuss the issues at stake.
It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Coleman.]
Mr. Morris: I am also glad that my hon. Friends the Members for Birmingham, Perry Barr (Mr. Rooker), Kirkcaldy (Mr. Gourlay) and Aberdeen, North (Mr. Hughes) have been able to intervene. They are all colleagues whom I respect for their concern for the blind and other disabled people.
Mr. Fairbairn: On a point of order, Mr. Deputy Speaker. I was anxious to intervene in the debate and I trust that I stood up before the Minister rose to reply. I hope that, as someone who did medicine, I shall not be prevented from speaking.
Mr. Deputy Speaker: It is the practice in Adjournment debates that hon. Members who wish to take part have the agreement of the hon. Member who has the Adjournment debate. I did not see the hon. and learned Gentleman in the Chamber during the debate. Therefore, I called the Minister to reply so that we could get on to the next Adjournment debate.
Mr. Morris Mr. Morris rose—
Mr. Fairbairn: Further to the point of order, Mr. Deputy Speaker. The debate was not due to start until 10 o'clock.
Mr. Deputy Speaker: We are on the Adjournment debate.
Mr. Morris: My hon. Friend the Member for Grimsby asked about the size of the problem in this country. Although there are no reliable official figures, informed estimates suggest that there are between 10,000 and 25,000. My hon. Friend suggested that the locality in which people live may have some link with the

965
incidence of the disease. I am advised that there is insufficient evidence to reach firm conclusions about that, but the possibility cannot be ruled out that differences in incidence may be at least partly determined by genetic factors, and particularly by the degree of in-breeding. For example, on the island of Tristan da Cunha, where there is a high degree of inbreeding, the disease is extremely common.
Many of our sufferers from the disease are young people. Many have families who are naturally and rightly anxious to explore any path that might lead to improvement. That is the background to this important debate.
One of the major problems, which has its effects on all research into the condition and its treatment, is that retinitis pigmentosa is not just one disease; it is a term used to denote a group of diseases in man which are clinically similar but which have different modes of inheritance and almost certainly represent different metabolic disorders. This group of diseases is characterised by progressive retinal degeneration and is accompanied by migration of pigment-containing cells into the retina. There is no accurate estimate of how many separate diseases are embraced by the term retinitis pigmentosa, but there are probably well over 10.
The different forms vary greatly in terms of the time of life when the disease becomes apparent, the rate of its progress, and other disabilities with which it may be associated.
My hon. Friend referred to tunnel vision. As he said, this distressing condition, where the peripheral vision is greatly obscured or non-existent, is one of the symptoms of some of this group of diseases and is also a symptom of other diseases of the eye. Research is currently being conducted into visual field expanders to help combat this condition, and my Department will be monitoring this research with great interest.
As my hon. Friend is aware, the Medical Research Council set up a working party to look into research into all aspects of retinitis pigmentosa. My hon. Friend has been sent a copy of its report and will have seen that, among its conclusions, the working party highlighted two basic problems.
966
It said:
"Our understanding of development and pathological reactions of the retina is so incomplete that the mechanisms of the disease at present must be largely speculative".
Again:
The delineation of the clinical picture of the human disease is still poor".
It is against the background of this present unsatisfactory state of knowledge that research into the disease and its treatment must be considered. In fact, the whole history of the study of retinitis pigmentosa is chequered with treatments which at first looked promising, only to drop quickly out of favour.
Mr. Fairbairn: The Minister used the term "pathological reactions of the retina". Will he tell me what he means by that?
Mr. Morris: I much regret that the hon. and learned Gentleman did not catch your eye, Mr. Deputy Speaker. His purpose now seems to be to delay the reply to this very important debate. The hon. and learned Gentleman joined us only very recently, Mr. Deputy Speaker, and you have given your advice. I am quite prepared to answer afterwards any questions of detail that may arise. I hope that the hon. and learned Gentleman, as a fellow parliamentarian, will agree that I must in decency give a full and considered reply to my hon. Friend, who has spent a great deal of time on this subject. He has clearly been quite genuinely concerned that there should be a full ministerial statement.
The hon. and learned Gentleman asked me what I meant by a certain phrase which is taken from a report of the working party. I told the House that a copy of the report was sent to my hon. Friend. I am quite prepared to make a copy of the report available to the hon. and learned Gentleman. He has my respect. I know of his work. He is an active member of this House. However, I hope that he will see the importance of a full and considered ministerial reply on a matter which is of very deep concern to many people in this country.
I was saying that it is against the background of the present unsatisfactory state of knowledge that research into the disease and its treatment must be considered. I said that in fact the whole history of the study of retinitis pigmentosa

967
is chequered with treatments which at first looked promising, only to drop quickly out of favour. This increases the distress of sufferers from the disease, and their families. Hopes for a successful treatment have often been raised and then dashed.
There has been a great deal of publicity, especially in the last few months, about two different forms of treatment for retinitis pigmentosa. One is carried out at the Opos Eye Clinic, in Switzerland, and the other at the Helmholtz Eye Diseases Research Institute, in Moscow. Many hon. Members have written to me about these treatments, often on behalf of constituents who are sufferers or relatives of sufferers. I am afraid that I have not been able to reply in encouraging terms, notwithstanding some news stories that patients have been treated abroad apparently with spectacular success.
What all of us must avoid is raising the hopes of sufferers without any proper basis for doing so. I am pleased that some patients have returned from treatment in Switzerland or Moscow with the feeling that their condition has improved, but for the benefit of all sufferers, including people who are considering trying to obtain these treatments abroad, we must have regard for the opinions of the great majority of ophthalmologists in this country.
Let me turn first to the treatment at the Opos Clinic, which I know my hon. Friend has examined most carefully. I understand that the treatment there consists primarily of implants of human placental and fetal tissue into the back of the eye. In fact, this form of treatment has been tried extensively throughout the world in years past and has been generally discarded. My advisers are not aware of its continued use anywhere now, except by ophthalmologists in Odessa, where the treatment started, and those in the Opos Clinic in Switzerland. I must emphasise that even in Switzerland no other ophthalmologists practise this treatment.
All my medical advice is that there is no prospect of this treatment being effective. When the treatment was considered by the Medical Research Council's working party, which I mentioned earlier, it made a comment which is highly relevant
968
and important to our debate this evening. Again I quote:
"Tissue therapy using placenta as a biological stimulant was widely practised for the ten years following 1955. There is no convincing evidence of improvement in vision following these treatments."
My hon. Friend has suggested that my Department should undertake a survey of patients who have received treatment at the Opos Clinic. Yet I know he will appreciate that such a survey could be conducted only on a prospective basis to assess objectively any apparent improvement following treatment. Certainly, we would be most interested to know of any objective evidence of improvement of patients who have received treatment at the Opos Clinic. A research project would, however, be dependent both on the co-operation of the patients and the enthusiasm of the ophthalmologists looking after them in this country. This is, of course, something which my Department has no power to direct, but we would look at any research proposal most sympathetically. I hope that my hon. Friend will regard that as a constructive response to the suggestion that he has made.
Mr. Austin Mitchell: I am most grateful to my hon. Friend for his offer to look constructively at a research programme which might be submitted. I think that it is possible to devise a research programme which over a period will show whether or not there have been benefits from this treatment. The crucial part of the argument is whether these people have been helped. I thank my hon. Friend most sincerely for his offer.
Mr. Morris: I am grateful to my hon. Friend. Clearly, we must be in further touch with regard to the suggestion about research.
Let me stress at this stage that consultant ophthalmologists in this country can, of course, use the types of treatment practised at the Opos Clinic under the NHS if this, in their judgment, is clinically necessary. At present, the Medical Research Council is supporting two research projects into retinitis pigmentosa. The first of these concerns research into "Abnormal retinal physiology in retinitis pigmentosa" and the second involves genetic and clinical aspects of the disease. Both projects are funded for three years,

969
from September 1977 to August 1980. In addition, research is being conducted by the MRC clinical and population cytogenetics unit at Edinburgh, where basic laboratory type work is being conducted in a search for genetic markers for retinitis pigmentosa. This was identified by the MRC working party as a priority for research.
Turning to the treatment available at the Helmholtz Institute in Moscow to which my hon. Friend the Member for Kirkcaldy referred, let me first of all pay tribute to the working together that has resulted from eye diseases being one of the specific matters covered by the United Kingdom-USSR agreement on co-operation in medicine and public health. In consequence of the agreement, experts in this country have been able to learn more about the form of treatment used at the Helmholtz Institute. However, although we have a fair idea about the general basis of the treatment, which I am advised consists mainly of injections of yeast ribonucleic acid and entails several repeat visits, the exact details about the composition of the injections used and their method of preparation are not available. Nor do we have details about precisely which types of patients are being treated.
The Russians do not, in fact, claim that the Helmholtz treatment cures the disorders for which it is being used but only that it arrests their development for a period of time and in a proportion of patients. For this reason alone, it is imperative that patients should not be encouraged to exaggerate the possible results. As I said before, none of us must raise the hopes of sufferers if we feel fairly certain that their hopes will be dashed.
A group of consultant ophthalmologists in this country who have considered all the facts so far available have stated that the scientific evidence is as yet incomplete. In their opinion, until further information becomes available patients cannot reasonably be advised to travel to Russia for this treatment. Moreover, I understand that this opinion reflects ophthalmological opinion generally in this country.
It is for this reason that my Depart. ment has been unable to help in the way that several hon. Members have sug-
970
gested to me in their letters—namely, by use of the power under the United Kingdom-USSR agreement to assist with the funding of patients who wish to receive treatment in Moscow. There is no similar power for Switzerland.
As my hon. Friend the Member for Grimsby will appreciate, I am extremely sorry not to be able to paint a brighter picture. But it is in the best interests of sufferers and their families that we should not raise hopes that cannot be realised. I know only too well how their hopes are raised by reports of successful treatments for this distressing disease in other countries. But I know, too, how this often leads to even greater distress when their hopes are thwarted.
If I may quote just once more from the Medical Research Council's working party's report:
"There is no satisfactory evidence to suggest that any of the attempts to modify the disease process has been successful and there is little, if any, scientific justification for the various treatments which have been used … At the present time there is insufficient scientific basis for any of the treatments currently in use to warrant any support by the Council of clinical trials".
It is an unpalatable fact, but one which must be faced, that no specific treatment has as yet been generally accepted by ophthalmologists as effective in preventing, correcting or curing retinitis pigmentosa.
For the future, I hope that my hon. Friend the Member for Grimsby and those others who have spoken in the debate and through them patients and their relatives, will at least feel assured on two matters: first, that we give high priority to research through the Medical Research Council for effective treatment of the condition, and, secondly, that my Department will continue to monitor progress on any course of therapy, either at home or abroad, which shows promise of improving treatment techniques.
I turn now to the practical help that can be given to the blind and the partially sighted, including people who suffer from retinitis pigmentosa. I refer specifically to low vision aids. I am very conscious of the difference that these aids can make to the life and activities of partially sighted people, even to the point of enabling them to have a job which would not otherwise be possible. A wide range of aids is available on long-term

971
free loan when prescribed by a consultant ophthalmologist. Nevertheless, we are concerned about the patchiness of the low vision aid service from one region to another.
My right hon. Friend the Secretary of State made this point when he addressed the Royal National Institute for the Blind last year. He said that it was quite unfair that the quality of life for a partially sighted person should be determined by the part of the country in which he or she lived. In order to try to overcome this problem, my officials are in the process of consulting relevant bodies, including the RNIB and the Partially Sighted Society, as a first stage towards discussions with health authorities. They will be looking for ways of ensuring that there is at least one centre in each region where low vision aids can be supplied.
The House will appreciate that even one such centre for each region may in some cases mean substantial extra expenditure, and it would not be reasonable to expect the instant supply of low vision aids to be made immediately in every area. We are, however, anxious to resolve the problems and achieve a more even distribution of the service throughout the country.
At this stage I should like to pay a warm tribute to the RNIB and the Partially Sighted Society on behalf of the House as a whole. There is little party animus on this subject as we share a deep concern for disabled people. I hope that the work of the RNIB and the Partially Sighted Society will go from strength to strength.
As the House knows, the social services departments of local authorities offer several important services to people who become blind. They can provide help with learning to cope without sight in the home. They can give instruction in mobility techniques such as the use of a long cane, and instruction in braille where appropriate. Some authorities arrange for newly blind people to attend a residential rehabilitation course run by the RNIB.
In addition, blind people are eligible, as are other disabled people, for the services provided under the Chronically
972
Sick and Disabled Persons Act and the Chronically Sick and Disabled Persons (Scotland) Act. Such services include help with aids and adaptations, such as the provision of a telephone or recreational facilities such as talking books. The disablement resettlement service of the employment service division of the Manpower Services Commission provides specialised help on employment.
Mr. Gourlay: Has the Department drawn the attention of local authorities to the specific provision in respect of people suffering from this disease? This is a disease suffered by many people, but it appears that because they comprise only a small proportion of the total population the seriousness of the disease is allowed to be glossed over. Therefore, if the Department has not yet done so, will it draw attention to this class of individual?
Mr. Morris: I assure my hon. Friend that I shall give sympathetic consideration to his suggestion. I tend to refer not so much to particular disabilities or diagnostic groups but to the needs of disabled people as a whole. There are people with this disease who are handicapped within the meaning of the Chronically Sick and Disabled Persons Act. Hon. Members on both sides of the House would carry out a great service to handicapped people if they were to speak in their constituencies about the priority of the claims of local disabled people.
As I was saying, the disablement resettlement service of the employment service division of the Manpower Services Commission provides specialist help on employment. Blind persons' resettlement officers and blind persons' training officers, who can be contacted through jobcentres and employment offices, cover industrial employment. The RNIB's placing officers advise on opportunities in the commercial, administrative and professional fields and also assist visually handicapped school leavers. In this way a comprehensive service is provided.
In regard to financial help, there are real advantages in the Government's developing policy on cash benefits for disabled people. The disadvantages of blind people have long been recognised in the special provisions for them in both social security and the personal social services.

973
In a real sense the blind paved the way for other disabled people for whom there was little, if any, recognition whatever. In recent years, however, there has been a development of services and cash benefits to help large numbers of severely disabled people with their problems. Blind people qualify in the same way for new help if their needs meet the criteria.
I wish to take this opportunity to reaffirm our commitment to exempt the registered blind and partially sighted from optical charges. Although the preparations are taking a long time, it remains our intention to see that this new exemption is introduced as soon as the way is clear.
My hon. Friend the Member for Perry Barr asked how many blind people receive mobility allowance. I cannot give him a precise figure tonight, but I wish to emphasise that many blind people receive the allowance. It is not, however, an allowance that can be paid for blindness alone. We are deeply aware of the pressure to do more than we have done so far. I have said on many occasions that I work in an area of activity in which there are infinite claims but only finite resources.
My hon. Friend also referred to the orange badge scheme. I am glad to have
974
legislated for that scheme in 1970. It is a source of pleasure to me also that the scheme now confers benefits on blind people. The blind, of course, cannot drive, but they can be driven by other people. Therefore, the orange badge scheme is very important to them. It is not possible for me now to deal with the matter which was mentioned about discussions in Standing Committee. I have no doubt, however, that the point will be carefully noted by my colleagues.
My hon. Friend the Member for Kirkcaldy asked for more research. Research is proceeding, and I hope he will agree that I have made a positive response to the suggestions which he and my hon. Friend the Member for Perry Barr made. My hon. Friend the Member for Kirkcaldy takes a close interest in these matters. All that he said tonight will be carefully and sympathetically considered in—
The Question having been proposed at Ten o'clock and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Quesion put, pursuant to the Standing Order.
Adjourned at half-past Ten o'clock.

SOCIAL SERVICES
  Social Security Officials and Claimants
  Social Security Officials and Claimants
  Pension Increases
  Pension Increases
  Doctors (Emigration)
  Doctors (Emigration)
  Health Centre, Knottingley
  Health Centre, Knottingley
  Pharmacists
  Pharmacists
  Hospital Closures
  Hospital Closures
  Mental Health Act (White Paper)
  Mental Health Act (White Paper)
  Mobility Allowance
  Mobility Allowance
  Psychiatric In-Patients
  Psychiatric In-Patients
  Hospital Waiting Lists
  Hospital Waiting Lists
  Benefits
  Benefits
  Child Benefit
  Child Benefit
  Retirement Pension
  Retirement Pension
  Drugs (Dispensing)
  Drugs (Dispensing)
  British Dental Association
  British Dental Association
  Over-75s
  Over-75s
  Social Security System (Review)
  Social Security System (Review)
  Prescriptions (Barbiturates and Tranquillisers)
  Prescriptions (Barbiturates and Tranquillisers)
  National Health Service (Royal Commission's Report)
  National Health Service (Royal Commission's Report)
  Whipps Cross Hospital (Maternity Unit)
  Whipps Cross Hospital (Maternity Unit)
  Cigarettes (Sales Promotion)
  Cigarettes (Sales Promotion)
  Motability
  Motability
  Casualty Treatment (Chelmsford and Colchester)
  Casualty Treatment (Chelmsford and Colchester)
  Hospitals (Resources Allocations)
  Hospitals (Resources Allocations)
  Children (Non-accidental Injury)
  Children (Non-accidental Injury)
  Invalidity Benefit (Therapeutic Earnings)
  Invalidity Benefit (Therapeutic Earnings)
  Pharmacies (Northumberland)
  Pharmacies (Northumberland)
  Lambeth, Southwark and Lewisham Area Health Authority
  Lambeth, Southwark and Lewisham Area Health Authority
  Private Medical and Hospital Services
  Private Medical and Hospital Services
  Chronically Sick and Disabled Persons Act 1970
  Chronically Sick and Disabled Persons Act 1970
  Sickness Benefit
  Sickness Benefit
  Induced Births
  Induced Births
  Rent Allowances
  Rent Allowances
  CBI AND TUC
  CBI AND TUC
  PRIME MINISTER (ENGAGEMENTS)
  PRIME MINISTER (ENGAGEMENTS)
  SPANISH PRIME MINISTER (VISIT)
  SPANISH PRIME MINISTER (VISIT)
  TRIBUNE ALTERNATIVE ECONOMIC STRATEGY
  TRIBUNE ALTERNATIVE ECONOMIC STRATEGY
  ZAIRE
  ZAIRE
  PRESIDENT CASTRO
  PRESIDENT CASTRO
  CHANCELLOR OF THE EXCHEQUER (SPEECH)
  CHANCELLOR OF THE EXCHEQUER (SPEECH)
  COUNCIL OF MINISTERS
  COUNCIL OF MINISTERS
HOUSE OF COMMONS
  Members' Salaries
  Members' Salaries
INDUSTRY
  Electronics Industry
  Electronics Industry
  Chrysler UK Limited
  Chrysler UK Limited
  Energy Conservation
  Energy Conservation
SCOTLAND
  Maternal Mortality
  Maternal Mortality
  Crofters (Grants)
  Crofters (Grants)
  Back-court Improvements
  Back-court Improvements
  Argentina (Ministerial Visits)
  Argentina (Ministerial Visits)
  Immigration
  Immigration
  Special Branch
  Special Branch
  Mentally-Ill and Handicapped Persons
  Mentally-Ill and Handicapped Persons
AGRICULTURE, FISHERIES AND FOOD
  Animals (Exports)
  Animals (Exports)
  Fish and Chips
  Fish and Chips
  Dutch Elm Disease
  Dutch Elm Disease
  Agricultural Output
  Agricultural Output
  Agricultural Land
  Agricultural Land
  Agricultural Investment
  Agricultural Investment
SOCIAL SERVICES
  Psychiatric Nursing Services
  Psychiatric Nursing Services
  Benefits
  Benefits
  Mental Illness Hospitals
  Mental Illness Hospitals
  Psychiatric Consultants
  Psychiatric Consultants
  Psychiatric Nurses
  Psychiatric Nurses
  Mentally Handicapped Persons
  Mentally Handicapped Persons
  Mentally Handicapped Children
  Mentally Handicapped Children
  Hospital Inquiries
  Hospital Inquiries
  Electro-convulsive Therapy
  Electro-convulsive Therapy
  Psychiatric Hospitals and Services
  Psychiatric Hospitals and Services
  Prestwich Hospital
  Prestwich Hospital
  Regional Secure Units
  Regional Secure Units
  Special Hospitals
  Special Hospitals
  Mental Health Services
  Mental Health Services
  Hospital In-Patients (Cost)
  Hospital In-Patients (Cost)
  Community Hospitals
  Community Hospitals
  Sheltered Employment
  Sheltered Employment
  Psychiatric Units
  Psychiatric Units
  Autistic Adolescents
  Autistic Adolescents
  Psychiatric Patients
  Psychiatric Patients
  District-based Services
  District-based Services
  Doctors (Psychiatric Vocational Training)
  Doctors (Psychiatric Vocational Training)
  Psychiatric Hospitals Admissions
  Psychiatric Hospitals Admissions
  Mentally Handicapped Persons (Earnings Limits)
  Mentally Handicapped Persons (Earnings Limits)
  Research
  Research
  Psychiatrists
  Psychiatrists
  Consultants (Merit Awards)
  Consultants (Merit Awards)
  Psychosurgery Operations
  Psychosurgery Operations
  Prescriptions
  Prescriptions
  Mental Health Act (Review)
  Mental Health Act (Review)
  Patient Care
  Patient Care
  Mentally Ill and Handicapped Persons (Drugs)
  Mentally Ill and Handicapped Persons (Drugs)
  Community Health Services
  Community Health Services
  Expenditure
  Expenditure
  Fireworks (Injuries)
  Fireworks (Injuries)
  Canada (Reciprocity)
  Canada (Reciprocity)
  Family Income Supplement
  Family Income Supplement
  Supplementary Benefit and Pensions
  Supplementary Benefit and Pensions
  Induced Births
  Induced Births
  Retinitis Pigmentosa
  Retinitis Pigmentosa
  Homoeopathy
  Homoeopathy
  Victoria Hospital, Southend
  Victoria Hospital, Southend
  Supplementary Benefit
  Supplementary Benefit
  Nurse and Doctor-Patient Ratios
  Nurse and Doctor-Patient Ratios
  Breast and Cervical Cancer
  Breast and Cervical Cancer
  Nurses (Employment)
  Nurses (Employment)
EDUCATION AND SCIENCE
  Discotheques (Noise)
  Discotheques (Noise)
  Inspectors
  Inspectors
  Special Education
  Special Education
  Mental Illness
  Mental Illness
  Sandwich Courses
  Sandwich Courses
  School Milk
  School Milk
  Sixth Form Students (Attendance Allowance)
  Sixth Form Students (Attendance Allowance)
  Rayner Ward (Secondary Education)
  Rayner Ward (Secondary Education)
ENVIRONMENT
  Planning Applications
  Planning Applications
  National Waterways Board (Works Programme)
  National Waterways Board (Works Programme)
  Sports Sponsorship (Tobacco Companies)
  Sports Sponsorship (Tobacco Companies)
  Gipsies
  Gipsies
  Rent Arrears (Distraint)
  Rent Arrears (Distraint)
  Somerset Wetlands
  Somerset Wetlands
  Royal Parks (Catering Services)
  Royal Parks (Catering Services)
  Waterways (Management)
  Waterways (Management)
  Office Accommodation (London)
  Office Accommodation (London)
  Community Land (Devon)
  Community Land (Devon)
  Development Land Tax
  Development Land Tax
  Mineral Workings (Planning Control)
  Mineral Workings (Planning Control)
  Substandard Houses (Farnham)
  Substandard Houses (Farnham)
  Planning Inquiries (Inspectors' Rulings)
  Planning Inquiries (Inspectors' Rulings)
  Rent Rebates and Allowances
  Rent Rebates and Allowances
  Fluorspar
  Fluorspar
  Refuse Collection
  Refuse Collection
  Urban Areas (Designated Districts)
  Urban Areas (Designated Districts)
TRANSPORT
  Ipswich Bypass
  Ipswich Bypass
ENERGY
  Onshore Oil and Gas
  Onshore Oil and Gas
  Public Corporation (Staff)
  Public Corporation (Staff)
  Offshore Oil and Gas (Celtic Sea)
  Offshore Oil and Gas (Celtic Sea)
FOREIGN AND COMMONWEALTH AFFAIRS
  Rhodesia
  Rhodesia
HOME DEPARTMENT
  Meditation Techniques
  Meditation Techniques
  Dogs (Smoking Tests)
  Dogs (Smoking Tests)
  Community Relations Personnel
  Community Relations Personnel
  Television Relay Station (Llangollen)
  Television Relay Station (Llangollen)
  Immigration
  Immigration
  Police (Injury Compensation)
  Police (Injury Compensation)
  Animals (Experiments)
  Animals (Experiments)
  Firearms
  Firearms
  Welsh Language Programmes
  Welsh Language Programmes
  Immigration Appeals
  Immigration Appeals
  Sunday Trading
  Sunday Trading
  "Equal Opportunities Commission News"
  "Equal Opportunities Commission News"
  Royal Marriages Act
  Royal Marriages Act
  Mentally Ill Aliens (Repatriation)
  Mentally Ill Aliens (Repatriation)
  Released Mentally Ill Prisoners
  Released Mentally Ill Prisoners
  Gambling (Royal Commission Report)
  Gambling (Royal Commission Report)
  Special Branch
  Special Branch
  Prisoners (Mental Illness)
  Prisoners (Mental Illness)
  Children (Fingerprinting)
  Children (Fingerprinting)
PRICES AND CONSUMER PROTECTION
  Tyre and Furniture Industries
  Tyre and Furniture Industries
  Vinegar
  Vinegar
  Albright and Wilson
  Albright and Wilson
  Price Commission
  Price Commission
TRADE
  Industrial Democracy
  Industrial Democracy
  Korean Electrical Goods
  Korean Electrical Goods
  European Community (Trade Deficit)
  European Community (Trade Deficit)
NATIONAL FINANCE
  Unallocated Taxes
  Unallocated Taxes
  Tax Allowances
  Tax Allowances
  Overseas Investments
  Overseas Investments
  Development Land Tax
  Development Land Tax
  Tax Revenue
  Tax Revenue
  Indirect Taxes
  Indirect Taxes
  Direct Taxes
  Direct Taxes
  PUBLIC EXPENDITURE
  PUBLIC EXPENDITURE
DEFENCE
  Queen Elizabeth Military Hospital, Woolwich
  Queen Elizabeth Military Hospital, Woolwich
  Animals (Experiments)
  Animals (Experiments)
EMPLOYMENT
  Special Temporary Employment Programme
  Special Temporary Employment Programme
  Railways (Vacancies)
  Railways (Vacancies)
  Unemployment (Older Men)
  Unemployment (Older Men)
  Dock Labour Scheme
  Dock Labour Scheme
  Disabled Persons
  Disabled Persons
  Advisory, Conciliation and Arbitration Service
  Advisory, Conciliation and Arbitration Service
  Trade Union Recognition
  Trade Union Recognition
  Disablement Resettlement Officers
  Disablement Resettlement Officers
  Industrial Earnings
  Industrial Earnings
  Pay Agreements
  Pay Agreements
  Ex-psychiatric Patients
  Ex-psychiatric Patients
  Farnham
  Farnham
  Training Opportunities Scheme
  Training Opportunities Scheme
  Canvey Island Study
  Canvey Island Study
  Work Experience
  Work Experience
  Industrial Training Boards (Awards)
  Industrial Training Boards (Awards)
  Training Services Agency (Preparatory Courses)
  Training Services Agency (Preparatory Courses)
  Training Workshops
  Training Workshops
  Skincentres (Unit Costs)
  Skincentres (Unit Costs)
  Industrial Courses
  Industrial Courses
  Special Training
  Special Training
  Job Release
  Job Release
  Job Introduction
  Job Introduction
  National Health Service (Health and Safety)
  National Health Service (Health and Safety)
WALES
  Capital Building Programmes
  Capital Building Programmes
  Welsh Language
  Welsh Language
  Health Services (Expenditure)
  Health Services (Expenditure)
  Nursery Education
  Nursery Education
  National Health Service Rural Practices Fund
  National Health Service Rural Practices Fund
  Mentally Handicapped Persons
  Mentally Handicapped Persons
  Flooding (Coal Tips)
  Flooding (Coal Tips)
  Flooding (Domestic Premises)
  Flooding (Domestic Premises)
NORTHERN IRELAND
  Trade Figures
  Trade Figures
  Police (Special Branch)
  Police (Special Branch)
  Uniforms (Government Employees)
  Uniforms (Government Employees)
  Harland and Wolff
  Harland and Wolff
  Civil Servants
  Civil Servants
  Firemen
  Firemen
  Intimidation
  Intimidation
  Punishment Shootings
  Punishment Shootings
  Social Benefit Payments
  Social Benefit Payments
  Disabled Persons
  Disabled Persons

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

MARRIED WOMEN'S INCOME TAX
Lord REIGATE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what steps they are taking to make it more widely known among taxpayers, particularly married women, that they are entitled to be separately assessed for income tax.
The PARLIAMENTARY UNDERSECRETARY of STATE, DEPARTMENT of the ENVIRONMENT (Baroness Birk): My Lords, the Government agree that greater publicity for the separate assessment provisions is needed. The Inland Revenue are issuing two new leaflets later this year; one dealing generally with the tax treatment of married couples, including separate assessment, and the other explaining the separate assessment provisions in greater detail. Both leaflets will be publicised and widely available.
Lord REIGATE: My Lords, while that reply is satisfactory so far as it goes, may I ask the Minister whether she is aware that issuing a leaflet is one thing but how widely it is publicised is another? Will it be widely publicised and will there be a campaign in the Press?
Baroness BIRK: My Lords, I do not know the details at the moment, but I am well aware that to get this publicised widely it will need very wide publicity, wider than having it available in, say, tax offices, and I will, with great pleasure, be prepared to take this up with my right honourable friends.
Baroness ELLES: My Lords, are measures being taken to see that new forms are issued to husbands who must fill in Inland Revenue forms and that the income of the wife will not be included on such forms?
Baroness BIRK: The forms at present issued to married women, those which have given understandable offence to them, are being reviewed by the Government, my Lords, which means presumably that new forms will have to be issued.
Baroness WARD of NORTH TYNESIDE: My Lords, would the Minister and my noble friend accept my congratulations at the very quick action which was taken? Will the noble Baroness accept that on this occasion I am delighted to be able to congratulate the Government?
Baroness BIRK: My Lords, I thank the noble Baroness very much and would add on behalf of the Government how grateful we are to have her good wishes.
Lord PARGITER: My Lords, is it the intention ultimately that married women who are separately assessed shall not be chargeable against their husbands for tax?
Baroness BIRK: That is a different point, my Lords. I think my noble friend is referring to aggregation, a matter at which the Government are looking. My right honourable friend the Chief Secretary said last week that the Government were considering that as well, but it is a rather longer-term problem than the two issues with which I have been dealing.

COMPENSATION FOR NATIONALISED COMPANIES
2.39 p.m.
Lord ORR-EWING: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper. I think it would be right to declare an interest as I have 200 directors' qualifying shares in one of the 40-odd companies concerned.
The Question was as follows:
To ask Her Majesty's Government why they have failed to carry out the

169
ministerial undertaking made during the passage of the Aircraft and Shipbuilding Industries Bill that compensation payments would be "early and substantial" and whether they can now estimate the total of cutback in investment and jobs lost as a result of the failure.
Lord WINTERBOTTOM: My Lords, the Government have carried out their undertaking. Payments on account of compensation have been made in respect of all companies nationalised under the Aircraft and Shipbuilding Industries Act 1977. The payments are substantial in relation to the Government's preliminary view of their likely negotiating position and the great majority were authorised within nine months and seven months of the respective vesting dates for aircraft and shipbuilding companies. The compensation payment is used in whatever manner the recipients decide and does not necessarily affect employment or capital investment.
Lord ORR-EWING: My Lords, is the noble Lord aware that in March, 1976, during the deliberations of Standing Committee D in another place, the right honourable Gerald Kaufman said:
"Payments on account should be substantial and should be made at the earliest possible moment".—[Official Report.—Commons, Standing Committee D, 9/3/76, col. 1600.]
In reply, does the noble Lord consider that the disbursal of £28 million among 43 companies, in view of the fact that the global total is probably nearer £550 million, is a really substantial payment, and is it honouring the promises given by Ministers in both Houses?
Lord WINTERBOTTOM: My Lords, the House may remember that I repeated the formula originally stated by my right honourable friend in another place. Whether or not it is substantial is a difficult question to answer. As I said in my reply, the Government's view is that the payments are substantial in relation to the Government's preliminary view of their likely negotiating position.
Lord CAMPBELL of CROY: My Lords, is the noble Lord aware that payments so far to Vickers Limited have been described by its chairman, the noble Lord, Lord Robens, as derisory, and that formal discussions on compensation have
170
not yet even started? Why are the Government causing that company's investment programme to be reduced by one-third at a time when investment in manufacturing industry and jobs are badly needed? Is the noble Lord also aware that Britain has had reason to complain in the past about the expropriation by other countries of British assets without prompt and adequate compensation? Are not the Government now failing to live up to those words?
Lord WINTERBOTTOM: My Lords, I am aware of the chairman's statement. What happens in other countries is not, I think, directly relevant to our problem today.
Lord DENHAM: Why not?
Lord WINTERBOTTOM: Because I am not responsible for other countries, my Lords. I agree it is essential that this matter should be settled as soon as possible, but as to what is happening in areas of expropriation—and Her Majesty's Government will not expropriate any company; compensation will be paid on an agreed basis—I cannot agree that comparability with other countries is relevant to our discussion today.
Lord ROBBINS: My Lords, if the noble Lord—whose honourable intentions no one in this House would call in question—were in charge of other people's money, would he not be looking for other countries where similar treatment is not meted out to the legitimate owners of shares?
Lord WINTERBOTTOM: My Lords, the noble Lord is correct in that capital flow for new investment goes to those countries where it is secure.
Lord DRUMALBYN: My Lords, does the noble Lord recognise that in this matter the Government's credit is involved? Is he aware that, while the word "substantial" is obviously a relative term, the word was used without qualification, and certainly nobody had in mind that it was going to be qualified in the way in which the noble Lord has been told to qualify it today? It was said that payment would be substantial in relation to a preliminary view of the Government's negotiating position. This situation will do great damage of British credit.
Lord WINTERBOTTOM: My Lords, I am as jealous of the Government's credit as I am of my own.
Lord CARRINGTON: My Lords, does the noble Lord realise that the whole House will regard his answers as unsatisfactory? What are the Government going to do about paying their debts and acknowledging that they made promises which they have not kept? Will the noble Lord tell the House when it is expected that all this money will be paid to those people who actually have it owed to them?
Lord WINTERBOTTOM: My Lords, we are in an unhappy position where obviously a major bargaining operation is in progress. The Government have one view—that is the preliminary view of the value of the shares. There are other views of the value, one of which was stated in a letter to the Financial Times, I think yesterday. I feel that everyone in the House would wish that the negotiations could start as soon as possible, as well as be completed as soon as possible. I would have hoped that the finer points of negotiation were dropped, so that we could get down to the hard business of final figures.
Lord MONSON: My Lords, is the noble Lord aware that the rate of interest on the Government's stock to be issued in respect of the outstanding compensation payments will almost certainly be lower than the average bank overdraft interest rate over the period in question, and thus the companies concerned will be heavily out of pocket as a result of the Government's inexcusable procrastination?
Lord WINTERBOTTOM: My Lords, I do not accept that it is inexcusable, but there is no doubt that the passage of time devalues the value of money.
Lord BLYTON: My Lords, is the Minister aware that I hope that in negotiating a settlement for compensation we are not so stupid as to give what we gave to the mineowners and to the electricity and gas undertakings? That debt took about five years to wipe off in some cases, and in the case of the mines it took the miners almost 20 years to pay it. I hope that noble Lords on the
172
Benches opposite will remember that those industries were subsidised by public money before we took them over.
Lord WINTERBOTTOM: My Lords, the calculations are based upon a hypothetical Stock Exchange value at a date prior to the announcement of the Bill, and the Government are tied to this basis of negotiation.
Lord ORR-EWING: My Lords, is the noble Lord aware that this morning we read that £8 million is to be given to Lucas to create jobs? Does he not realise that if the other 90 per cent. of the money was given to the 42 companies, that of itself would start to increase investment and increase job opportunities, not only in those companies but in the capital goods industries from which they are ordering? Is this not also a paramount reason why the Government should honour ministerial promises? If promises cannot be honoured, surely in this day and age, Ministers should resign.
Lord WINTERBOTTOM: My Lords, unfortunately this is not a very simple issue. We are talking about negotiations. Nevertheless, as I said earlier, I think it is highly desirable that an early settlement is reached so that the money which ultimately will go to these companies is used for constructive purposes. However, I should like to point out that not every company is thinking of investing in new plant; some are considering buying new companies.
Lord ROBBINS: My Lords, does the noble Lord remember that when there was debate in this House concerning the basis of compensation, and some of us were urging the Government to adopt the basis which in the City and in the knowledgeable outside world generally would have been regarded as fairer, the plea was made by him that the present basis would be expeditious, and he defended it on that ground?
Lord WINTERBOTTOM: My Lords, I remember a very long-drawn-out battle; I cannot remember the exact details. However, in the course of that particular debate I used the words "early and substantial", echoing what my right honourable friend had said in another place.
Lord CARR of HADLEY: My Lords, I should like to follow up the point made by the noble Lord, Lord Robbins, because I am sure that the noble Lord, Lord Winterbottom, will recall that he and I, from our respective Front Benches, took a leading part in the debates. Does he recall that one of the main factors which in the end persuaded this House, however reluctantly, to accept a form of compensation which we believe was not right, was his promise of "early and substantial" interim payments? His personal promise on that was, in my mind—and, I suspect, in the minds of many noble Lords—a major factor in persuading us to acquiesce, however reluctantly, in the scheme of compensation as proposed in the Bill. Really, in this matter the honour of the Government and of the noble Lord is at stake.
Lord WINTERBOTTOM: My Lords, this is the problem of the spokesman. I in fact said this in full belief that this would happen. There are, however, extreme technical difficulties. Nevertheless, I believe that early and substantial payments on account are desirable from the point of view of productive industry.
Lord AVEBURY: My Lords—
The LORD PRIVY SEAL (Lord Peart): My Lords, we have been nearly 14 minutes on this Question. I think the Opposition have had a good run, and have made their point. If noble Lords feel we should have another minute of questioning, I am prepared because I have the next Question.
Lord CARRINGTON: My Lords, if I may say so, I think the Leader of the House is always in a difficult position on these occasions, and even though I for one, and indeed all of us, feel very strongly about this matter, I do not think we should bend the Rules of the House too much just because we feel strongly about something. But would the noble Lord be prepared, at any rate, to tell the Prime Minister what everybody in this House feels about this matter, and how unsatisfactory they think it is?
Lord PEART: My Lords, I think the noble Lord has made a point, and I must consider it, naturally. My noble friend who has explained matters has been
174
subject to searching criticism, and I understand this from the point of view of the Opposition. I will take note of what the noble Lord has said, of course.

PRESS INVERVIEWS: SENIOR CIVIL SERVANTS
2.52 p.m.
Lord WILSON of LANGSIDE: 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 regard it as—

(a) constitutionally appropriate, or

(b) in accordance with the rules governing the conduct of civil servants in relation to politically controversial matters,

for the permanent Heads of Departments to grant interviews to the Press for publication of views on Bills which are highly contentious and not yet approved by Parliament.
Lord PEART: My Lords, with the agreement of the appropriate Minister it is quite proper for senior officials to provide or explain the factual background to Government policy.
Lord WILSON of LANGSIDE: My Lords, while I thank the noble Lord for that Answer, am I to understand that the Secretary of State for Scotland gave permission to the Permanent Under-Secretary of State for Scotland to give the interview which was reported in the Scotsman newspaper on 1st June 1978?
Lord PEART: Yes, my Lords. The interview was agreed following Mr. Fraser's recent appointment as Permanent Under-Secretary. There is nothing wrong in this.
Lord WILSON of LANGSIDE: My Lords, may I then ask the noble Lord whether he thinks it was not contrary to the spirit, at least, of paragraph 9923 of Estacode? This interview proceeded upon the basis that the Scotland Bill would become law without acknowledgment of the fact that Parliament had still to

175
pass it, Her Majesty had still to give her consent, and the people of Scotland had still to speak in the referendum. Does the noble Lord not concede that this was contrary to the spirit—not to a very grave degree, but to some degree—of paragraph 9923 of Estacode, to which I have referred and which is very clear?
Lord PEART: No, my Lords, I cannot accept that. I believe it was in accordance with the rules. We have certain rules which are in paragraphs 4123 to 4136 of Establishment Officers' Guide, a copy of which is in the Library. There was nothing improper about this.
Lord STRATHCLYDE: My Lords, is it not traditional and indeed absolutely proper that members of the Civil Service, no matter what the importance of the office they hold, should not state their views or comments on Government or on departmental affairs except through the mouths of their Ministers, and should the Permanent Under-Secretary of State for Scotland not be reminded of that fact?
Lord PEART: Yes, my Lords, I would agree with that. Of course Ministers must be responsible for policy, but there is no reason why on an occasion like this an official should not explain policy.
The Earl of LAUDERDALE: My Lords, is the noble Lord saying that an official can declare in advance what Parliament is going to decide? Because that is what happened in this case.
Lord PEART: No, my Lords, I am not saying that at all, and the noble Earl knows that.
The Earl of LAUDERDALE: Is the noble Lord aware that that is what happened in this case?

THE FALKLAND ISLANDS: NEGOTIATIONS
2.55 p.m.
Lord MORRIS: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what progress has been made at the current negotiations with the Argentinian Government on the question of the Falkland Islands.
The MINISTER of STATE, FOREIGN and COMMONWEALTH OFFICE (Lord Goronwy-Roberts): My Lords, our negotiations with Argentina are still at an early stage. Following the first meeting of working groups in February, we are discussing with the Argentine Government arrangements for carrying forward the negotiating process.
Lord MORRIS: My Lords, though I thank the noble Lord for his Answer, may I ask the noble Lord whether Her Majesty's Government would not agree that the Argentinians' somewhat petulant belligerence, their recent boarding of a trawler under the threat of traversing guns, their buzzing of a trawler in Berkeley Sound, their continued occupation of Southern Thule and President Videla's "hawkish" speech to all military units only last Sunday together indicate Argentinian frustration at Her Majesty's Government's most praiseworthy resolution and diplomatic determination over the question of the sovereign integrity of British possessions in the South-West Atlantic?
Lord GORONWY-ROBERTS: My Lords, there have indeed been a number of incidents, to which we have drawn the attention of the Argentine Government in no uncertain manner, and we shall continue to make the representations appropriate on every such occasion. As to the statements made by Argentine leaders to which the noble Lord referred, I find that on Malvinas Day, which they celebrated recently, President Videla referred to the successful outcome, as he hoped, of current negotiations; and Admiral Montes, I am glad to say—and I quote him—spoke of
"a struggle for the recovery of the Falklands carried out in the framework of peaceful measures".
This gives hope that the current negotiations based on the two working groups, political and economic, may possibly bear fruit.
Lord MORRIS: My Lords, in the light of what has gone before, will the Minister

177
be good enough to explain Her Majesty's Government's seeming reluctance to translate words into actions and to put some money where their diplomatic mouth is, at least to reassure your Lordships' House that adequate defence arrangements have been made for the South-West Atlantic and that Her Majesty's Government will, as a matter of urgency, implement the two major recommendations of the admirable report of their colleague, the noble Lord, Lord Shackleton?
Lord GORONWY-ROBERTS: My Lords, I think it was on 25th January of this year that I went into some detail about the steps we were taking to implement as many as possible of the recommendations of my noble friend Lord Shackleton. I could give a progress report on the various projects that I then mentioned. It would take some time, but possibly by Parliamentary means I might indicate how far we have got. As to the major projects, as I then explained, these did not appear to be practicable at that time, and I am afraid I cannot hold out any hope that they are more practicable today than they were then in terms of finance and for other reasons.
Lord AVEBURY: My Lords, is the Minister aware that when I took the deputation from the Argentine Human Rights Committee to see his colleague, Mr. Ted Rowlands, one of the points we made to him very strongly was that weapons should not be sold to the Argentinian regime in case, among other things, they might be used against the Falklands—and we were talking particularly about the proposed contract with Vosper Thorneycroft for the sale of frigates—and that the Minister then replied that there was no question of them using for hostile action against the Falkland Islands naval vessels that we might be in the course of selling them? Yet, immediately after that we opened our newspapers and we found that some of these islands had been occupied by Argentinian military forces for the last 18 months. Why was this not revealed to the British public, and what steps is the Minister going to take, if arms are to be sold to the Argentinian authorities, to prevent them being used in hostile action against the Falklands?
Lord GORONWY-ROBERTS: My Lords, I think I explained on a fairly recent occasion what had happened about the alleged occupation of Southern Thule, to which I presume the noble Lord is referring. It was in fact a scientific activity, and I have no evidence to disprove that. We have received assurances —indeed, detailed assurances—from the Argentine Government that this was so. We have made our protest in order to safeguard our sovereignty in that part of the Dependencies, as in every part of the Falkland Islands and its Dependencies. As for the selling of arms, there is no ban on the sale of arms to Argentina. As to frigates, we, like a number of other countries, have been invited to submit tenders. There is no definitive or finalised negotiation on this matter; we are one of a number of countries asked to tender, and I could not engage in a discussion of the details of such a question.
Baroness ELLES: My Lords, could the Minister elucidate further this question of the occupation of part of the Falkland Islands, which I understand is not alleged but is in fact true? Could the Minister say whether during the process of negotiation with the Argentine Government, any undertaking had been given by, or had been asked of, that Government to retain the status quo until such time as the negotiations are terminated, together with an undertaking not to take any action which might threaten either the sovereign territory of the Falkland Islands or the waters around it? May I ask a further question? If the Argentine Government continue to take the kind of action they are now taking by menacing ships within the Falkland territorial waters, and sending people to occupy part of their territory, what action do the Government intend to take?
Lord GORONWY-ROBERTS: My Lords, the action that we propose to take is the action we have already taken, and I think it has met with a measure of success. Very careful consideration must be given to rather attractive proposals of drastic action in situations of such delicacy and danger. As to the occupation, as the noble Baroness is entitled to call what happened in Southern Thule, this is not the first time that the Argentines have visited Southern Thule, withdrawn and come back. In 1954 and 1955,

179
when another Government were in power in this country, this happened. No doubt then as today we made the protests which asserted our sovereignty over that part of the Dependencies. It is not, strictly speaking, an occupation. It is scientific activity, as we are assured. But this brings me to the helpful suggestion made by the noble Baroness. Indeed, it would be a great help if a constructive arrangement for joint action in regard to scientific and other activities in these areas could be agreed to by the two Governments. I am able to tell the House that our chargé, who was over here for consultation recently, has been given new instructions on those lines.
Lord ELTON: My Lords, as the economic as well as the security aspects of this question are likely to be before us for some time, could the noble Lord undertake to see that copies of Lord Shackleton's report are made available in the Printed Paper Office? I understand that there were only six copies to start with and that no replenishments have been available since last year. Although there are three copies in the Library, as this is a subject of general interest, I think that that is not a sufficient supply.
Lord GORONWY-ROBERTS: My Lords, I fully agree. It is a valuable report and I will see to it that there are adequate copies available in the Printed Paper office for the use of noble Lords.
Lord BYERS: My Lords, as this is a scientific expedition, will Her Majesty's Government see that they get the benefits of any results obtained?
Lord GORONWY-ROBERTS: My Lords, that would be the major purpose of such an operation. There is scope for international co-operation in research, in exploitation and in development of industries—oil, fish and other industries—in these waters, as the House will know. It is a major purpose of British diplomatic initiative and effort to come to an arrangement in the area between the three countries—the United Kingdom, the Argentine and the Falkland Islands—so that a proper scheme of co-operative exploitation of the resources of the area is agreed upon.
Lord CLIFFORD of CHUDLEIGH: My Lords, in view of the long-range implications of this Question, would it not be a good idea for the Government to reactivate the Parachute Brigade and the necessary long-range RAF squadrons?
Lord GORONWY-ROBERTS: My Lords, that is a question in itself of a somewhat long-range nature: but, as always, we shall bear in mind everything that the noble Lord suggests.
Lord GORE-BOOTH: My Lords, would it be helpful to suggest that a large captive audience will shortly be leaving Argentina and that the temptation to play this in high key in that country will diminish somewhat and will enable the Government to pursue a patient policy?
Lord GORONWY-ROBERTS: My Lords, no doubt that is so. I imagine that my noble friend is referring to the captive audience of those who are at the moment visiting this beautiful country for sporting purposes. I, myself, would hesitate to describe any Scot as part of a captive audience.
Lord BALLANTRAE: My Lords, so far as the Scots are concerned, may I assure the Minister that they would much prefer to stay in Argentina?

FILMS BILL [H.L.]
Read 3a, and passed, and sent to the Commons.
INTERNATIONALLY PROTECTED PERSONS BILL
Read 3a, and passed.

SCOTLAND BILL
3.7 p.m.
Further considered on Report.
Schedule 10 [Matters within legislative competence of Assembly, and within powers of Scottish Executive]:
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 123A:
Page 57, line 40, leave out ("reserved") and insert ("scheduled").
The noble Lord said: My Lords, this and the following Amendment have already been discussed, and I am glad to say that the Government are prepared to accept them. I beg to move.
On Question, Amendment agreed to.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment 123B:
Page 58, line 9, leave out ("reserved") and insert ("scheduled").
On Question, Amendment agreed to.
The SOLICITOR-GENERAL for SCOTLAND (Lord McCluskey)The SOLICITOR-GENERAL for SCOTLAND (Lord McCluskey) moved Amendment No. 123C:
Page 58, leave out lines 21 and 22.
The noble and learned Lord said: My Lords, this is an Amendment for which we are grateful to the noble Viscount, Lord Thurso. During Committee, the noble Viscount proposed that the Scottish Assembly and Executive should be able to alter estuarial limits provided that they did so within what might be called "devolved" waters; that is, the waters defined in Group 14 of Part I of Schedule 10. The Government have looked into this matter and agree that the movement of estuarial limits can be a useful tool in fisheries management and that it would be appropriate to devolve this matter as part of the wider devolution of salmon and fresh water fisheries. May I express our gratitude to the noble Viscount for raising this matter and enabling us to improve the Bill. I beg to move.
On Question, Amendment agreed to.
3.10 p.m.
The MINISTER of STATE, SCOTTISH OFFICE (Lord Kirkhill)The MINISTER of STATE, SCOTTISH OFFICE (Lord Kirkhill) moved Amendment No. 124:
Page 59, leave out lines 24 to 28 and insert—

("The Radioactive Substances Act 1948 (c. 37), sections 5(1)(b) and 7.

The power under section 5(1)(b) is not included so far as it relates to sites and premises mentioned in section 2(1) and (2) of the Radioactive Substances Act 1960 (c. 34) and the matters dealt with in section 7 are included only in relation to offences under regulations made by a Scottish Secretary.").

The noble Lord said: My Lords, this is a very technical Amendment, which involves no change of policy. Section 5(1)(b) of the Radioactive Substances Act 1948 concerns the disposal of radioactive waste. However, we are required to amend the entry for the 1948 Act to express the policy more precisely. The Amendment does three things: it turns round the entry in such a way as to reflect more closely the terms of the legislation to which it relates. Secondly, it makes clear that Section 7 of the Act, which concerns enforcement, is devolved only in relation to regulations under the Act by a Scottish Secretary. Thirdly, it removes the previous mention of Section 9; this is an ancillary procedural provision and there is no need to deal with it explicitly in the Bill because it is automatically devolved or reserved depending on whether it relates to devolved or reserved matters. I beg to move.
On Question, Amendment agreed to.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 125:
Page 59, leave out lines 35 and 36 and insert—

("The Civil Aviation Act 1949 (c. 67),section 28.

Not included.")

The noble and learned Lord said: My Lords, this Amendment, like 120 others which we have already discussed and others yet to come, is consequential upon the removal of aerodromes from Part I of Schedule 10. Like that earlier Amendment and others I have yet to move, this one is moved by the Government without prejudice to any action which it may be decided to take in another place to restore aerodromes to Part I of Schedule 10. At the moment, it is an essential tidying up Amendment. I beg to move.
On Question, Amendment, agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 126:
Page 60, leave out lines 46 and 47 and insert—

("The Clean Air Act 1956 (c. 52), section 22.

Not included, except so far as relating to property vested in the First Secretary or held for the purposes of a Scottish Secretary")

The noble Lord said: My Lords, again this is a technical Amendment relating

183
to a point raised by the noble Earl, Lord Selkirk, at Committee stage. The Government are grateful to the noble Earl for directing our attention to this matter. Section 22 of the Clean Air Act 1956 relates to smoke pollution from Crown premises including ships of the Royal Navy. Where a local authority report such pollution to the Minister concerned, he must conduct an inquiry and—if there is cause for complaint—take action to rectify the matter. After devolution both the Scottish Executive and the Government will hold Crown premises in Scotland. It is the Government's intention that Section 22 should be devolved only in relation to property held by the First Secretary; for example office buildings occupied by civil servants working on devolved matters, hospitals and prisons. For all other Crown premises it should be reserved since it is the Minister concerned—and not a Scottish Secretary—who will be in a position to put matters right. The present entry in the Bill for the Clean Air Act did not achieve this policy satisfactorily, and this Amendment now puts the matter right. I beg to move.
The Earl of SELKIRK: My Lords, I am grateful to the noble Lord for this clarification. However, may I be clear on this point? The Amendment reads:
"The Clean Air Act…section 22…Not included,…".
Does that mean that Section 22 is not included or does it mean that the whole Act is not included? I am never quite clear on this point. There is a reference in Amendment No. 169 in which the noble Lord I think deals with this point. So far as I can understand this, there are certain responsibilities which deal with pollution which are devolved in so far as premises, motor vehicles, aircraft, hovercraft or vessels are concerned. Also the control of emissions of noxious or offensive substances otherwise than from motor vehicles, aircraft or hovercraft. That I think goes with it, if I understand it correctly. Perhaps the noble Lord can answer this simple question: who is really responsible for clean air in Scotland? Is it still the Secretary of State—that is to say, with the exception of property belonging to the Scottish Executive? Does the responsibility for clean air rest entirely with the Secretary of State?
Lord KIRKHILL: My Lords, with the leave of the House, may I say that it is Section 22 of the Act which will be devolved only in relation to property held by the Scottish Executive. That is the key point of this Amendment and it is the point to which the Government are responding in the light of the noble Earl's earlier remarks in Committee. As to responsibility for clean air, it is the responsibility of a Scottish Secretary.
The Earl of SELKIRK: My Lords, may I ask this question? I apologise for speaking again, but the words say that Section 22 is not included. What about the rest of the Act? Do those words not apply there or are we to say that the Bill is silent in respect of the rest of the Act and therefore it does not devolve?
Lord KIRKHILL: My Lords, the Bill is silent.
Lord CAMPBELL of CROY: My Lords, I know that we can speak only once at Report stage and so it might be helpful if I indicated my reading of this Amendment. It is that where the Bill is silent it means that the subject is not devolved, so this should mean that the rest of the Bill is not devolved.
Lord McCLUSKEY: My Lords, subject to this qualification: that the subject matter of the Clean Air Act may be devolved by reason of its inclusion in one of the groups in Part 1 of Schedule 10.
On Question, Amendment agreed to.
3.16 p.m.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 126A:
Page 61, column 2, leave out lines 16 to 20 and insert—
("The following matters are not included:—

(a) the provisions of section 120 relating to the establishment of traffic commissioners and their power and duty of issuing licences;

(b) the provisoins of section 135(1) relating to the authority having power to grant a road service licence;

(c) the provisions of section 137(1);

(d) the other provisions of Part III, except so far as they relate to the two traffic commissioners other

185
than the chairman and to road service licences or permits under section 30 of the Transport Act 1968; and

(e) the matters dealt with otherwise than in Part III.").

The noble Lord said: I spoke at some length during our discussions yesterday evening on the road transport Amendments put down by the noble Lord, Lord Campbell of Croy, and the noble Lord, Lord Morris, on the subject of road service licensing. I explained that this Amendment is proffered by the Government as a response to points made in debate during Committee stage. We had a lengthy discussion about this subject last night. In the light of all that we said then, I hope that your Lordships will feel able to accept the Government Amendment. I beg to move.
Lord CAMPBELL of CROY: My Lords, I am grateful to the noble Lord, Lord Kirkhill, for not repeating what he said last night. He gave us more than a "trailer" when he spoke on an earlier Amendment. I did not speak on that occasion on this Amendment because I thought that I would wait until it was reached. It is clearly the Government's intention now to restrict the extent to which changes in the system of passenger transport licensing North and South of the Border can be made or different systems introduced within Scotland. That is a move in the right direction. The Amendment, however, does not go very far. As the Minister said last night, it ensures a uniform system within Scotland, but that system could become different from the system in England and Wales, and that is what would make life more difficult and confusing for bus operators North and South of the Border. That is a point which is not covered by the Amendment. None the less, I suggest to your Lordships that we should accept the Amendment.
I must make it clear also that we are not raising or challenging the question of the taking of local decisions about licensing services in different areas. They are taken now locally and, as we understand it, those decisions will be taken locally under the Bill. That is not something which we are trying to change. What we are trying to do is to ensure that the system of licensing under which
186
those decisions are taken is uniform, because otherwise many operators who run services all over Britain will find it confusing.
I will repeat something which I said last night: strong representations have been made to us, and, we believe, to the Government from the Confederation of British Passenger Transport. They represent almost every bus operator in the country: 98 per cent. of all the operators South of the Border and nearly 100 per cent. of operators North of the Border. I am not talking about the private sector, the independents: they represent them all, the local authorities, the Scottish Transport Group, everybody who is operating buses. They have strongly represented that the system should be kept uniform. Decisions can then be taken locally in the light of local circumstances, but under that system.
The noble Lord has also indicated that the Government in their Amendment are making arrangements for the present expedited procedure for traffic commissions in different parts of the country to support the recommendations speedily of their neighbours. The Government say that they are "entrenching" this—to use their word—in the Bill. That is again welcome, and this Amendment goes in the right direction, although not as far as the bus operators or we on these Benches would wish. However, I suggest that the House should accept this Amendment.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 127:
Page 61, line 26, leave out from ("are") to end of line 31 and insert—
("not included so far as they relate to site and premises mentioned in section 2(1) and (2);
(bb) the powers under section 10 are not included so far as they relate to such sites and premises;").
The noble Lord said: My Lords, this is a technical Amendment to the entry in the Bill for the Radioactive Substances Act 1960. It is indeed similar to the earlier Amendment No. 124 for the Act of 1948, which I moved earlier, and again it involves no change of policy. The provisions of the 1960 Act affected by the Amendment concern radioactive waste.

187
As with the 1948 Act, the policy is that this matter should be devolved only so far as it relates to waste other than from United Kingdom Atomic Energy Authority premises and licensed nuclear sites. The Amendment to head (b) of the entry for the 1960 Act expresses this in a way which achieves this intention more precisely than does the present wording. Section 10 of the 1960 Act concerns the provision of facilities for the disposal and accumulation of radioactive waste. The present entry in the Bill devolves this section in respect of all waste, but this is not the Government's intention. As with other related provisions, the policy is to reserve the powers under this section in relation to waste from United Kingdom Atomic Energy Authority premises and licensed nuclear sites, and to devolve powers in all other respects. The new head (bb) created by the Amendment ensures that this intention is achieved, and I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendments Nos. 128 and 129:
Page 62, leave out lines 7 to 9.
Page 62, leave out lines 17 to 27.
The noble Lord said: My Lords, with the permission of the House, I would take Nos. 128 and 129 together. They are consequential to the removal of inland waterways from the groups of devolved matters from Part I of Schedule 10. These Amendments delete from Part III of Schedule 10 the entries relating to the provisions of the Transport Act 1962 which were devolved as part of the devolution of responsibility for inland waterways. Of course, I move these Amendments without prejudice to the attitude the Government may adopt on the matter of inland waterways when the Bill returns to another place. These are tidying-up Amendments, and I beg to move.
On Question, Amendments agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 130:
Page 63, line 12, at end insert—

("The Local Government (Development and Finance) (Scotland) Act 1964 (c. 67),

Not included, so far as relating to the erection of industrial buildings, within the meaning of section 64 of the Town

section 7.

and Country Planning (Scotland Act 1972 (c. 52).").

The noble Lord said: My Lords, this is a minor Amendment concerning local authority powers in respect of industry. At present the Local Government (Development and Finance) (Scotland) Act 1964 is devolved by virtue of the general competence provided by Group 5 of Part I of Schedule 10 to the Bill. However, Section 7 of that Act enables local authorities to make advances in respect of the erection of buildings, including industrial buildings. This section should not be devolved in respect o industrial buildings because it has implications for regional industrial policy, which is reserved in all other contexts. The Amendment puts the matter right by specific exclusion in Part III of Schedule 10. I beg to move.
On Question, Amendment agreed to.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 131:
Page 63, line 37, at end insert—

("The Forestry Act 1967 (c. 10), section 15.

Included.")

The noble and learned Lord said: My Lords, this Amendment is consequential upon the deletion of forestry in the course of the Committee stage. I beg to move.
On Question, Amendment agreed to.
3.26 p.m.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 131A:
Page 64, leave out lines 6 to 10.
The noble and learned Lord said: My Lords, this is a technical Amendment in respect of fisheries. The Amendment deletes the entry in Part III of Schedule 10 for the Sea Fish (Conservation) Act 1967. The result is that this Act will now be devolved to the extent of the general competence set out in Group 14 of Part I of Schedule 10; that is, it will be devolved in respect of salmon and migratory trout (but not sea fish proper) within the waters defined in that Group. It is essential to freshwater fisheries management that there is also competence in coastal waters in respect of salmon and migratory trout.
The only reason for inclusion of the entry in the first place was a doubt as

189
to whether Group 14 would, in itself, have been sufficient to devolve matters in respect of migratory trout. However, this doubt has now been removed by an earlier Government Amendment to Group 14 which was made yesterday, which made clear that migratory trout came within its scope. I beg to move.
Viscount THURSO: My Lords, this Amendment gives me an opportunity to make up for being so slow in rising on the previous Amendment, 123C, to thank the noble and learned Lord, Lord McCluskey, for the very kind terms in which he spoke of my intervention in the matter of fish, estuarial limits and so on. In turn, I should like to thank the Government for the way in which they have considered this matter so carefully and have listened to various words from different parts of your Lordships' House on these matters so that they have now greatly improved the wording of the Bill in relation to salmon and migratory trout matters. I do thank the noble and learned Lord McCluskey, and the noble Lord, Lord Kirkhill, for their help in these matters, and I support the Government in their Amendment.
On Question, Amendment agreed to.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 132:
Page 64, line 16, at end insert ("and the matters dealt with in section 58 are not included").
The noble and learned Lord said: My Lords, this is a minor technical Amendment. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 132A:
Page 64, line 16, at end insert—

("The Abortion Act 1967 (c. 87).

Not included")

The noble Lord said: My Lords, during the Committee stage, on a Division, the Committee removed the word "abortion" from Group 1 of Part 1 of Schedule 10. From the tenor of the debate it was apparent that the Committee wished to ensure that the criminal law with regard to abortion should be the same North and South of the Border. However, it is doubtful whether the Amendment carried in fact achieves that effect. The Government are consequently moving this
190
Amendment to put the matter beyond all doubt. I must make it clear that this is without prejudice to the Government's position on the further consideration of the Bill in another place. I might just add that Group 24 and Group 25 of Schedule 10 devolve to the Assembly a legislative competence for a wide range of matters in relation to both the civil and criminal law. These groups carry with them aspects of the law relating to abortion.
Given the sensitive nature of the matter, the Government believe it is essential that there should be no possible doubt about what the Bill provides. Consequently, this Amendment would add the Abortion Act 1967 to Part III of Schedule 10, to make it clear that the matters contained in it are not devolved. I trust the House will acknowledge the need for the Amendment as a consequence of your Lordships' previous decision. I should further add that the exclusion of matters in the Abortion Act 1967 carries with it executive powers in the field exercised by Ministers as well as legislative reservation. In the Government's view, these executive powers need to be devolved even though the law on abortion is reserved. The Government have accordingly tabled an appropriate Amendment to Schedule 11 which we shall come to later, but I thought it appropriate to mention that at this stage.
Lord CAMPBELL of CROY: My Lords, as the mover of the original Amendment to remove abortion from the devolved subject, which was successful in your Lordships' Committee, I would say that I think it was perfectly clear what your Lordships intended in that original Amendment. What the Government are now doing in their further Amendments in the Bill appears to me to be carrying out that intention. I am sure it is right that the Bill should go to another place complete in all respects. As I said yesterday, Schedule 10 is so complicated, taking pieces of the statutes and referring to individual sections of them, that only the Government draftsmen who prepared this Bill could carry out the consequentials that were required. I am grateful to the noble Lord for having explained this, and also for having proposed the later Amendment in order to tidy up this part of the Bill.
On Question, Amendment agreed to.
3.31 p.m.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 133:
Page 64, leave out lines 17 to 19.
The noble Lord said: My Lords, Amendment No. 133 is another consequential Amendment, following upon the deletion of the provision concerning aerodromes during the Committee stage. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 134:
Page 64, line 22, column 2, leave out ("18") and insert ("14(2), 18, 19(1) (proviso), 24, 28"),
The noble Lord said: My Lords, I should just point out that the Amendment is wrongly printed on the Marshalled List. It is to page 64, line 22 at column 2. Of course we intend to correct the printing error. This Amendment concerns excepted statutory undertakers. It is the first of several such Amendments to Schedule 10. The others will be Nos. 135, 136, 144, 147 to 151. Earlier we had a number of similar Amendments to Schedule 4. In the debate on the first of these (that was Amendment No. 68) I explained in general terms the approach of the Bill to excepted statutory undertakers. I also explained that these Amendments have a common purpose, which is to make such additions and corrections to the Bill as are necessary to ensure that following devolution existing rights of excepted statutory undertakers are safeguarded. This particular statutory Amendment has the effect of reserving four additional provisions of the New Towns (Scotland) Act 1968. These are: Section 14(2), the proviso to Section 19(1), Section 24 and Section 28. I beg to move this technical Amendment.
Lord CAMPBELL of CROY: My Lords, I rise only to say that the noble Lord is working from yesterday's Marshalled List. I can tell him that in to-day's, the fourth Marshalled List, the two corrections have already been made so that what was yesterday line 21, col. 1, has now become line 22, col. 2.
Lord KIRKHILL: My Lords, I acknowledge it was not a list; it was a note that I had. I fully acknowledge that today's Marshalled List makes it correct.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 135:
Page 64, line 26, leave out ("and") and insert—
("(aa) those dealt with in section 28 are excluded only so far as they relate to representations made by excepted statutory undertakers;").
The noble Lord said: My Lords, this is a technical Amendment consequential on the Amendment we have just discussed. It ensures that Section 28 of the New Towns (Scotland) Act 1968 is reserved only where it relates to orders made at the behest of excepted statutory undertakers. The provision is otherwise devolved. My Lords, I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 136:
Page 64, line 29, after ("(5)") insert (",47(4)").
The noble Lord said: My Lords, this is another Amendment tidying up the entry for the New Towns (Scotland) Act 1968 in relation to excepted statutory undertakers. Section 47(4) of the 1968 Act contains two powers: the power of the Treasury to decide who is the "appropriate Minister" in respect of a statutory undertaker, and the power of the appropriate Minister to determine whether the land of a statutory undertaker is operational. The Bill as it stands reserves both powers outright. However, they should only be reserved in respect of excepted statutory undertakers. The Amendment corrects the anomaly. I beg to move.
On Question, Amendment agreed to.
[Amendment No. 137 not moved.]
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 138:
Page 64, line 47, leave out ("34") and insert ("31, 34, 36, 37").
The noble Lord said: My Lords, this Amendment is concerned with local authority bus services. It is entirely consistent with the policy on related matters throughout the Bill. The effect of the Amendment is to devolve Sections 31, 36 and 37 of the Transport Act 1968. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 139:
Page 64, hue 48, at end insert—
("( ) the power to make regulations under section 135, by virtue of subsection (1)(d) of that section, is included;").
The noble Lord said: My Lords, this is a minor technical Amendment concerning Section 135(1)(d) of the Transport Act 1968. This provision concerns regulations for the payment of compensation where a passenger transport executive revokes consent for the continuation of an existing bus service in its area. At present Section 135(1)(d) is reserved by the entry at head (f) for the 1968 Act, and then it deals with the Scottish Transport Group. This is wrong in two respects. First, Section 135(1)(d) has nothing to do with the Scottish Transport Group; it has to do with passenger transport executives. Second, it should be devolved. This is in line with the general devolution of matters relating to passenger transport executives achieved by the entry at head (a) for the 1968 Act at the foot of page 64. The Amendment accordingly devolves outright the making of compensation regulations in respect of Section 135(1)(d). My Lords, I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 140:
Page 65, leave out lines 17 to 22.
The noble Lord said: My Lords, this is the first of two Amendments. The other is Amendment No. 143 which deletes from Part III of Schedule 10 entries relating to provisions of the Transport Act 1968 which were included as part of the devolution of responsibility for inland waterways. This is a tidying up Amendment. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 141:
Page 65, line 28, at end insert—
("( ) the powers under sections 7, 8 and 29 are included so far as they relate to schemes or orders tranferring property to or from the Scottish Transport Group or any of its subsidiaries;
( ) the powers under section 135(6) are included in cases where the Scottish Transport Group is the compensating authority;").
The noble Lord said: My Lords, this is a technical Amendment linked with Amendments numbers 69 and 74 to Schedules 4 and 5 which have already been discussed. It concerns Sections 7, 8, 29 and 135(6) of the Transport Act 1968, which in turn concern relations,—for example the transfer of property—between the Scottish Transport Group and other nationalised industries. The effect of this particular Amendment is to ensure that the provisions are devolved where the Scottish Transport Group is concerned. I beg to move.
On Question, Amendment agreed to.
3.40 p.m.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 142:
Page 65, line 31, leave out from ("Act") to ("are") in line 33.
The noble Lord said: My Lords, this is a minor technical and consequential Amendment which has two distinct purposes. First, it deletes the reservation of Sections 7 and 8 of the Transport Act 1968. This is part of the wider package, to which I referred in proposing the last Amendment and which we have now encountered on several occasions, dealing with the Scottish Transport Group's relations with other nationalised transport industries. Secondly, it deletes the reservation of Section 135(1)(d) of the 1968 Act, which deals with the payment of compensation by passenger transport executives. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 143:
Page 65, leave out lines 38 to 43.
The noble Lord said: My Lords, this Amendment, like Amendment No. 140, is consequential upon the removal of inland waterways from Part I of Schedule 10 at the Committee stage. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 144:
Page 65, column 2, leave out lines 46 to 51 and insert ("Not included").
The noble Lord said: My Lords, this is another in the series of technical Amendments relating to excepted statutory

195
undertakers which I introduced in Amendment No. 68. This Amendment relates to one specific excepted statutory undertaker—the Post Office. Paragraph 93(4) of Schedule 4 to the Post Office Act 1969 empowers the Secretary of State to make regulations as to the definition of "operational land" for the purposes of various planning enactments. At present, this power is partially devolved by the entry for the Act in the Scotland Bill. This is in error. The approach of the Bill elsewhere is to reserve powers to define the operational land of excepted statutory undertakers, as this is something which a Scottish Secretary is not in a position to assess. The Amendment puts the matter right. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 145:
Page 66, line 17, at end insert—

("The Roads (Scotland) Act 1970 (c. 20), section 44.

The power of the Treasury under subsection (4) is not included and the other matters dealt with are included only so far as relating to land vested in the First Secretary or held for the purposes of a Scottish Secretary").

The noble Lord said: My Lords, this Amendment corrects a minor omission in the Bill in respect of the Roads (Scotland) Act 1970. This Act concerns the acquisition of land for, and construction of, highways. As such, it is devolved by virtue of Group 11 of Part I of Schedule 10 to the Bill. But Section 44 requires express provision in Part III of Schedule 10, because it concerns the application of the Act to Crown land. The Government's policy on provisions such as this is to devolve in respect of devolved Crown land and otherwise to reserve. The Amendment carries through the same approach in respect of Section 44 of the Roads (Scotland) Act 1970. The Amendment additionally reserves the power of the Treasury to determine who is the "appropriate authority" in respect of Crown land. I beg to move.
On Question, Amendment agreed to.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 146:
Page 66, column 2, leave out lines 32 to 41 and
196
insert ("The matters dealt with in section 29A and those dealt with in section 29, so far as it relates to section 29A, are included.").
The noble and learned Lord said: My Lords, like other Amendments already considered, this one is consequential upon the removal of aerodromes from Part I of Schedule 10. I should simply add that Section 29A of the Civil Aviation Act 1971 (added by the Airports Authority Act 1975) is concerned with the mitigation of the effects of noise and vibration from aircraft. Section 29 of the 1971 Act contains general powers in relation to noise pollution, and to make sense of the devolution of the matters in Section 29A it is necessary that these general powers should be devolved in so far as they relate to the matter covered by Section 29A.
I should say that this Amendment will not entitle the Assembly to control the operation of aircraft to reduce noise levels. This is not a devolved matter. The devolution proposed is purely to enable the effects of noise near airfields to be mitigated by the Scottish Administration, to the extent that they may think fit. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 147:
Page 67, line 20, leave out ("121(1)") and insert ("108(2), 117(1) (proviso), 121(1), 209,").
The noble Lord said: My Lords, this is another in the series of Amendments relating to statutory undertakers. It provides for three additional safeguards in respect of the Town and Country Planning (Scotland) Act 1972, similar to those which an earlier Amendment, No. 134, incorporated in respect of the New Towns (Scotland) Act 1968. The Amendment has the effect of reserving the following provisions Section 108(2), the proviso to Section 117(1) and Section 209. I beg to move.
On Question, Amendment agreed to.
3.45 p.m.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 148:
Page 67, line 21, leave out ("and 241") and insert (", 240 and 241 and paragraph 70 of Schedule 22").
The noble Lord said: My Lords, this is a further Amendment in respect of the entry in Schedule 10 for the Town and Country Planning (Scotland) Act 1972.

197
It has two purposes. First, it adds a reservation of legislative competence in respect of Section 240, which concerns grants for research and education in connection with planning and the design of the physical environment; the entry in Schedule 11 at the foot of page 73 already devolves executive competence in respect of Section 240. Secondly, it reserves paragraph 70 of Schedule 22, which provides a special saving for the Post Office's position under the Telegraph Acts. This was another omission from the original entry which the Government now seek to correct. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 149:
Page 67, line 50, leave out ("section") and insert ("sections 222 and").
The noble Lord said: My Lords, this is a further technical Amendment to the entry for the Town and Country Planning (Scotland) Act 1972 relating to excepted statutory undertakers. Section 222 of the 1972 Act concerns the making of orders to modify or extend the functions of statutory undertakers. The Amendment provides for reservation of this provision where the orders are made at the behest of excepted statutory undertakers. Where the order is made at the behest of a local authority, but nevertheless affects the functions of an excepted statutory undertaker, Schedule 4 provides that Ministerial consent is required. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 150:
Page 68, leave out lines 23 to 30 and insert—
("(i) the powers under section 275(2), so far as exercisable in relation to excepted statutory undertakers;").
The noble Lord said: My Lords, again, this is a further technical Amendment to to the entry for the Town and Country Planning (Scotland) Act 1972, as it relates to excepted statutory undertakers. Section 275(2) of the 1972 Act contains two powers: the power of the Treasury to determine who is the appropriate Minister in respect of a statutory undertaker, and the power of the appropriate Minister to determine whether the land of a statutory undertaker is operational land. The Gov-
198
ernment's intention is to reserve both these powers in respect of excepted statutory undertakers, but to devolve them in respect of other undertakers. The present entry in the Bill achieves this intention for the second power, but it erroneously reserves the first power in respect of all undertakers. The effect of the Amendment is to put this right. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 151:
Page 68, line 24, after ("to") insert ("excepted")
The noble Lord said: My Lords, your Lordships may well be, as I am, glad to know that this is the last in the series of Amendments dealing with the Town and Country Planning (Scotland) Act 1972 and excepted statutory undertakers. Paragraph 4 of Schedule 18 to the 1972 Act concerns the extinguishment of rights of way over land on which there is the apparatus of statutory undertakers. This should be reserved only in respect of excepted statutory undertakers. The present entry mistakenly reserves it for all statutory undertakers. Therefore, the Amendment puts the matter right. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 151C:
Page 69, line 14, after ("sections") insert ("14 and").
The noble Lord said: My Lords, if it be for the convenience of the House, as I believe it to be, I should like to speak to Amendments Nos. 152 and 153 en bloc. Both concern the application of the Control of Pollution Act 1974 to radioactive waste. Part I of the Control of Pollution Act 1974 establishes a code for waste disposal. Section 30(5) provides that its provisions shall not apply to radioactive waste, but enables the Secretary of State to make regulations to apply them with any necessary modifications. At present, the entry in the Bill for the 1974 Act reserves this power to apply the waste code to radioactive waste.
The Government's approach to radioactive waste which we have set out in earlier Amendments, is that matters relating to United Kingdom Atomic

199
Energy Authority premises and licensed nuclear sites should be reserved. This reservation takes in all of the important producers of waste, such as nuclear power stations, reprocessing plants and research establishments. However, waste from other minor sites, such as hospitals, is devolved, because the same considerations relating to national safety and energy policy do not apply. The purpose of the Amendments is to carry this policy through in respect of Section 30(5) of the Control of Pollution Act 1974. I beg to move.
Lord CAMPBELL of CROY: My Lords, the noble Lord was speaking to Amendments Nos. 152 and 153, which deal with the control of pollution. I think that we are still on Amendment No. 151C which deals with the Land Compensation (Scotland) Act. Unless there is a direct connection, we seem to have skipped my two Amendments. I wonder whether the noble Lord could explain if there is a connection between Amendment No. 151C and Amendments Nos. 152 and 153.
Lord KIRKHILL: My Lords, I apologise to the House. I turned over two pages of my brief. I quite forgot that we had not discussed Amendment No. 151C, so at this stage perhaps I had better resume my seat.
Lord CAMPBELL of CROY: My Lords, I should like to give the Minister an opportunity to tell us about Amendment No. 15IC, because I do not think that he has yet spoken to it.
Lord KIRKHILL: My Lords, this is a tidying up Amendment in respect of Section 14 of the Land Compensation (Scotland) Act 1973, which concerns the Lands Tribunal for Scotland. At present, 'his provision is reserved, although all other matters in respect of the Tribunal are devolved by the general competence set out in Group 22 of Part I of Schedule 10. I am advised that the Amendment removes this inconsistency by listing Section 14 of the 1973 Act as included. I beg to move.
On Question, Amendment agreed to.
3.52 p.m.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 151A:
200
Page 69, line 35, leave out ("reserved") and insert ("scheduled").
The noble Lord said: My Lords, I beg to move this Amendment. May I take this opportunity to say that, as we are trying to facilitate the speed of business and because so many of these Amendments are consequential or are technical points, it is absolutely understandable that the noble Lord, Lord Kirkhill, should be having to go at some pace in moving from Amendment to Amendment. I entirely understand how it happened that he turned over two pages. Amendment No. 15IA and the immediately following Amendment, Amendment No. 151B, are both Amendments of mine which have been discussed and, I am glad to say, accepted in principle by the Government. Therefore, I beg to move.
Lord KIRKHILL: My Lords, yesterday the noble Lord, Lord Campbell of Croy, pointed out that there had been some difficulty in discovering what was the role of Schedule 15 because it had not been very easy to trace the words "reserved functions" throughout the Bill. However, I am happy to say that the noble Lord has very successfully tracked down all of the entries and that these two Amendments, like a number of others that we have looked at, put the Bill right in this respect. Therefore, we are very grateful to the noble Lord.
On Question, Amendment agreed to.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 151B:
Page 69, line 39, leave out ("reserved") and insert ("scheduled").
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendments Nos. 152 and 153:
Page 70, line 34, leave out ("30(5)").
Page 70, line 35, at end insert—
("(d) those dealt with in section 30(5), so far as they relate to sites and premises mentioned in section 2(1) and (2) of the Radioactive Substances Act 1960 (c. 34).")
The noble Lord said: My Lords, I have already put on the record my observations on Amendments Nos. 152 and 153. Therefore, I beg to move.
Lord CAMPBELL of CROY: My Lords, I accept that the noble Lord, Lord Kirkhill, spoke earlier on these two

201
Amendments. I was listening to his remarks in the light of this part of the Bill, and these Amendments certainly seem to be acceptable.
On Question, Amendments agreed to.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 154:
Page 70, leave out lines 36 and 37.
The noble and learned Lord said: My Lords, this Amendment is consequential upon the removal of aerodromes from Part I of Schedule 10. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 155:
Page 72, line 6, leave out ("3(1), 7 and 9") and insert ("3 to 5 and 7 to 9").
The noble Lord said: My Lords, this Amendment corrects a minor error in respect of the environmental functions of the Scottish Development Agency. The Government's approach, which was explained at length during the Committee stage, is that legislative devolution of matters included in the Scottish Development Agency Act 1975 should generally relate only to those functions of the Scottish Development Agency that are of an environmental nature.
This Amendment concerns paragraphs 3(2), 4, 5 and 8 of Schedule 2 to the Scottish Development Agency Act. These provisions deal with miscellaneous financial matters—the Agency's borrowing, Government loans to the Agency, the Agency's debts and accounts. These are all executively devolved in Schedule 11 in respect of the Agency's industrial functions, but Schedule 10 omits to devolve them legislatively and executively in respect of the Agency's environmental functions. This has the unfortunate result, for example, that the Secretary of State rather than a Scottish Secretary would be responsible for the Agency's borrowing on matters otherwise devolved. This is an omission which the Amendment seeks to put right. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 156:
Page 72, line 21, at end inert ("so far as it relates to administrative expenses and to functions other than those to which public dividend capital relates").
The noble Lord said: My Lords, this is a technical Amendment in respect of the financing of the Scottish Development Agency.
Paragraph 2 of Schedule 2 of the Scottish Development Agency Act 1975 is the provision under which the administrative expenses of the SDA are financed, and all those of their functions to which public dividend capital does not apply. At present, the Bill devolves the provision both legislatively and executively. But this might enable the Assembly to extend the scope of paragraph 2 so that it applied also to the finance of the public dividend capital functions of the SDA. The Amendment removes this possibility. I beg to move.
Lord DRUMALBYN: My Lords, may I ask the noble Lord whether, as it is excluded from these functions here, that means that public dividend capital continues to be provided by the Secretary of State and not by a Scottish Secretary, and that the administrative side of public dividend capital—that is, how much public dividend is to be paid, when it is to be paid and how much is to be ploughed back—still rests with the Secretary of State?
Lord KIRKHILL: Yes, it does, my Lords.
On Question, Amendment agreed to.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 157:
Page 72, leave out lines 28 and 29.
The noble and learned Lord said: My Lords, as noble Lords can see, this is an Amendment which is consequential upon the removal of aerodromes from Part I of Schedule 10. Section 7 of the Airports Authority Act 1975, which is listed in Part III of Schedule 10 as not included within the competence of the Assembly, deals with certain matters, and it is not necessary specifically to exclude these matters if the aerodromes themselves no longer appear in Part I of Schedule 10. Accordingly, we can remove this section from Part III, and I beg to move Amendment No. 157, which achieves that purpose.
On Question, Amendment agreed to.
Lord WIGG Lord WIGG moved Amendment No. 158:
Page 72, line 29, at end insert—

("The Lotteries and Amusements Act 1976 (c. 32), section 3, 4 and 5.

Included, except in relation to lotteries registered in accordance with section 53(d)(ii).").

The noble Lord said: My Lords, the Amendment standing in my name on the Marshalled List is consequential upon the satisfactory inclusion last night by your Lordships of the Amendment which I moved then, Amendment No. 114. I beg to move.
Lord McCLUSKEY: My Lords, I agree entirely with my noble friend Lord Wigg that the Amendment is consequential but I disagree entirely that it is satisfactory.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 159:
Page 72, line 50, at end insert—

("The Refuse Disposal (Amenity) Act 1978 (c. 3), section 4(2).

Not included.")

The noble Lord said: My Lords, this is a minor Amendment to take account of the recent Refuse Disposal Amenity Act 1978. This Act is a consolidating measure which brings together certain waste disposal provisions, derived primarily from the Control of Pollution Act 1974, and provisions in respect of abandoned vehicles, derived primarily from the Civic Amenities Act 1967. The provisions derived from these two Acts are all devolved by virtue of the general competence in respect of pollution provided by Group 7 of Part I of Schedule 10 to the Bill.
However, the Refuse Disposal (Amenity) Act also contains a provision (Section 4(2)) derived from the Vehicle and Driving Licences Act 1969, which relates to the basis on which a licence on an abandoned vehicle is considered to be current. It is necessary therefore to exclude this specifically in Part III of Schedule 10 to ensure that it is reserved along with other matters relating to driver and vehicle licensing. I beg to move.
On Question, Amendment agreed to.
Schedule 11 [Matters within powers of Scottish Executive but not within legislative competence of Assembly]:
4 p.m.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 159B:
Page 73, line 3, at end insert—
("GROUP AA (Abortion)
The powers under the Abortion Act 1967").
The noble Lord said: My Lords, during our discussion on Amendment No. 132A, I gave notice that I would return to the subject of abortion when we reached Schedule 11. I think that I would not represent the feeling of the House if I were to say that what concerned your Lordships most when the decision was taken to remove abortion from Group 1 of Part 1 of Schedule 10 to the Bill was the law on abortion and the feeling that in this area of the law there should be a uniform policy throughout the United Kingdom.
We have, without commitment on the part of the Government as to what will happen in another place, sought by our Amendment No. 132A to Part III of Schedule 10 to give effect to your Lordships' wishes. The entry for the Abortion Act 1967 in Part III of Schedule 10 reserves legislative competence over the matters dealt with in the Act. But it does more than that and perhaps more, I suggest, than your Lordships intended, because the Schedule 10 Part III entry also has the effect of reserving the executive and ministerial powers contained within the Act. These powers relate to the approval of places for the termination of pregnancy and to regulations concerning the certification of opinions on grounds for abortion, notification to the chief medical officer of termination of pregnancy and prohibitions on disclosure of information relating to abortion.
If the Bill were left so that these executive powers were reserved these functions would have to be carried out by the Secretary of State for Scotland who, of course, exercises those powers in respect of Scotland at present. The Scottish Assembly and Executive are of course to have very wide-ranging powers in relation to health. Full responsibilities in that field reserved to the Secretary of State relate to the control of drugs, medical products and other similar matters and to the regulation of the medical professions.
If, therefore, the executive powers in the 1967 Act were to be reserved, this would separate those aspects of health administration from all others of the National Health Service and the private health sector which would otherwise be the responsibility of the Scottish Executive. The Government do not consider that to be a sensible practical solution and it would give rise to difficulties. The Government feel that the Amendment to Schedule 11 overcomes this difficulty, but at the same time it does not infringe the intention of the Amendment previously carried by your Lordships. The strictly limited purpose of the Amendment to Schedule 11 which is now before your Lordships is to provide for the exercise of executive powers in the Abortion Act 1967 by a Scottish Secretary. Under the Amendment a Scottish Administration would not be able to alter in any way the provisions at present contained in the 1967 Abortion Act. I beg to move.
Lord CAMPBELL of CROY: My Lords, when earlier today the noble Lord spoke on a previous Amendment, which he said was consequential upon the decision taken by your Lordships in Committee about abortion, I said that in my view it was necessary for expert Parliamentary draftsmen to decide what changes were necessary in order to fulfil the intention of your Lordships contained in that decision. But, when the original decision was taken in Committee, I immediately got into touch with the Scottish Committee of the British Medical Association in Edinburgh, who, as I said at the time, were completely in favour of the Amendment. I suggested to them that they ought to consider what they thought were the necessary consequential Amendments in other parts of the Bill, because the matters which the noble Lord has just been discussing are matters of great concern to the medical profession. So I should like to ask the noble Lord whether he has been in contact with the BMA—or whether the Scottish Office has been in touch with them—about this and whether they also agree that this is a necessary consequential Amendment. If the notice is too short, perhaps the noble Lord can let me know later, but I should like to make that reservation.
The Earl of SELKIRK: My Lords, personally I think this is right. I had my
206
name down to the original Amendment, and it seems to me perfectly correct that the administration arising from the Act should rest with the Scottish Health Service.
On Question, Amendment agreed to.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 159C:
Page 73, line 18, at end insert—
("1. The powers under the Acquisition of Land (Authorisation Procedure) (Scotland) Act 1947, in cases where the compulsory purchase order is or would be made or confirmed by a Scottish Secretary, except—

(a) in cases where the apparatus belongs to excepted statutory undertakers, those under section 3(4); and

(b) those under paragraph 18 of Schedule 1.")

The noble and learned Lord said: My Lords, this Amendment is linked with Amendment No. 159E. They are both Amendments designed to achieve the same put pose in Schedule 11, and with the leave of your Lordships I will speak to them both at the same time. Both Amendments concern the procedural provisions under which compulsory purchase orders are made and confirmed. The Government's approach is that there should continue to be a common procedural code throughout Great Britain so that parties to cases will have the same rights, regardless of where the land to be acquired might be.
For this reason the provisions of the Acquisition of Land (Authorisation Procedure) (Scotland) Act 1947 and the analogous provisions of Schedules 3 and 4 of the New Towns (Scotland) Act 1968 are legislatively reserved by entries in Part III of Schedule 10 to this Bill. However, Scottish Secretaries will themselves have powers under various enactments to make compulsory purchase orders for devolved purposes and also to confirm the compulsory purchase orders of other bodies, such as local authorities, where the acquisition is for devolved purposes. It is therefore necessary to ensure that the procedural provisions of the 1947 Act, and of Schedules 3 and 4 to the 1968 Act, apply to Scottish Secretaries. This is achieved by the entries which we propose by these two Amendments to put into Schedule 11.
The entries also give to the Scottish Executive certain substantive powers in respect of matters which are devolved.

207
An example is the function under paragraph 12 of Schedule 1 to the 1947 Act of granting certificates in respect of compulsory purchase orders on the sites of ancient monuments. The entry does not, however, devolve any powers to make or alter procedures. That is the important point that I want to make. In line with this policy the power to make regulations under paragraph 18 of Schedule 1 to the 1947 Act is specifically reserved. Uniform procedures will therefore continue to apply throughout Great Britain. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 159D:
Page 73, line 26, at end insert—
(" 1A. The powers under paragraphs 2 and 5 to 7 of Schedule 3 to the Gas Act 1965.")
The noble Lord said: My Lords, this is a minor Amendment to devolve executively but not legislatively certain powers under the Gas Act 1965. Almost all the provisions of this Act will be entirely reserved, but paragraph 2 and also paragraphs 5 to 7 of Schedule 3 contain powers currently exercised by the Secretary of State for Scotland as part of his water and planning responsibilities, and these are suitable for executive devolution. I beg to move.
On Question, Amendment agreed to.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 159E:
Page 73, line 29, at end insert—
("2A. The powers under Schedules 3 and 4 to that Act.").
The noble and learned Lord said: My Lords, I spoke to this Amendment along with Amendment No. 159C. I beg to move.
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 159A:
Page 73, leave Out lines 30 to 32.
The noble Lord said: My Lords, this Amendment is one of two paving Amendments for a later technical Amendment in Schedule 16 relating to Section 7 of the Local Employment Act 1972. I beg I to move.
On Question, Amendment agreed to.
4.10 p.m.
Lord DRUMALBYN Lord DRUMALBYN moved Amendment No. 159F:
Page 74, line 1, leave out paragraph 7.
The noble Lord said: My Lords, we now revert, perhaps, as I hope, for the last time, to the difficult question of the Scottish Development Agency and whether the Secretary of State should continue to exercise supervision over the Agency in respect of their investment functions or whether those functions should be transferred to a Scottish Secretary. Perhaps I ought to explain first of all why I have put this Amendment down here. I thought when I first put down the series of Amendments from No. 160 onwards that they would have the effect of removing from the Scottish Executive the powers to supervise investment activities of the Scottish Development Agency while at the same time not removing from them the powers over the industrial estate functions of the Scottish Development Agency.
The noble Lord the Minister of State was so kind as to see me this morning with some of his advisers, and it now transpires that that series of Amendments would not by itself have had the desired effect —the effect desired from my point of view. The only way to achieve it would be by the Amendment that I have down here. No. 159F, which is to leave out paragraph 7. This is the paragraph which transfers from the Secretary of State to the Scottish Executive the power to supervise the industrial investment functions of the Scottish Development Agency which the Agency performs under the Scottish Development Agency Act 1975. In particular it transfers the power to give the Agency directions of a general or specific character as to the exercise of their functions mentioned in sub paragraphs (iv), (v) and (vi) of this paragraph 7.
The Scottish Development Agency Act created the Agency in 1975 and gave it new powers or extended powers for further economic development by investment, long term as well as short term, in industry, and in addition power to make loans and grants in Scotland. At the same time it combined with those investment functions the Scottish industrial estates functions which then were the subject of subsequent legislation. These two

209
broad groups of functions are dealt with separately in this Bill because of the nature of the functions. That is to say, the Scottish industrial estates functions are transferred in Schedule 10, Part III, which sets out in detail those provisions of the Scottish Development Agency Act which relate to matters included in groups of devolved matters contained in Part I of Schedule 10.
In paragraph 7, to which this Amendment refers, the powers in relation to industrial investment are transferred; that is to say, powers relating to matters which will come within the powers of the Scottish Executive but not within the legislative competence of the Assembly, powers to give directions, to give consent to Scottish Development Agency proposals where consent is needed, powers to determine financial duties of the Agency, and so forth. This, therefore, is the point at which your Lordships have to decide whether the first thoughts of the Government or their second thoughts were right. The first thoughts were reflected in the Scotland and Wales Bill. Under that Bill the investment functions were retained by the Secretary of State while the Scottish industrial estates functions were transferred to the Scottish Executive. There followed second thoughts, and they are reflected in the Bill, and they put both the Scottish industrial estates and the industrial investment functions under the Scottish Executive.
No doubt the noble Lord the Minister of State will explain that the first thoughts were severely criticised in Scotland. Well, clearly there must have been advantages in those first thoughts or they would not have appeared to start with. Equally there are disadvantages, as there generally are in most proposals. I would say that the main advantage of the Government's second thoughts—the ones reflected in the Bill as it is now—is that the Scottish Development Agency would he answerable only to one master instead of two, which would happen if the functions were divided with the Secretary of State in accordance with the nature of the functions.
Undoubtedly there are cases where the Scottish Development Agency help companies by taking shares or making loans, and also by providing them with a factory or extending a factory which already exists. There are other ways in which
210
both of the two broad groups of functions may be called into play in regard to a particular company. But the functions relating to factory building—whether it is a question of advance factories or tailor made factories—are really quite different in character from the financing functions. The former are a matter of planning in advance. Those of us who have been connected with this in the Board of Trade, as it then was, and through its various mutations since then, know that this is a very difficult operation indeed, depending on the availability of finance, the needs for the future, the number of factories that are vacant and available at the time and so on. That is one form of function. It is a matter of planning in advance.
But the second lot of functions, investment functions, are largely concerned with meeting a need or an opportunity in the present or even in the future. Clearly it is for the convenience of the customer, as well as of the organisation itself no doubt, if the customer can deal with the same organisation on both matters. But that is a convenience that has to be weighed up together with other considerations which perhaps were less obvious and less taken into consideration at the time when the criticisms were made. Time and again we have reverted to the need to maintain the economic unity of the United Kingdom as a whole, and this is appreciated on both sides of the House; the noble Lord, Lord Kirkhill himself has laid stress on it.
Of course, it looks all calm and plain sailing, or fairly calm and plain sailing, when the Secretary of State who prepares the guidelines for the Scottish Executive belongs to the same Party as the Scottish Secretary to whom he gives them. But even if they do belong to the same Party it is not just the Scottish Executive which will know about the guidelines. You cannot exclude them from the consideration of the Assembly, even though the Assembly has no legislative responsibility in regard to them. And it may well be that the Assembly, even the majority Party in the Assembly, may take exception to the guidelines when they discuss them. Of course, if a different Party comes into power at Westminster and revised guidelines are prepared to meet a change of national policy, then in those circumstances difficulties can obviously arise.

211
It may be that the majority Party severely criticises the action taken by its own Scottish Secretary in regard to the guidelines. It will certainly strongly criticise the guidelines. That is one of the places where the rift may come, a rift that may be exploited and very much enlarged for political purposes in Scotland, particularly by those who are aiming at a separate country altogether for Scotland.
Therefore one must balance the advantages and disadvantages. My own strong belief is that it is much wiser not to insert an extra link in a chain of control if it can be avoided. After all, one of the greatest assets—and this has always been recognised—for Scotland in the government of the United Kingdom is the institution of the Secretary of State for Scotland who is in the Cabinet. He is expected to know at first hand what is going on in Scotland, what is needed and so forth. He is not expected to know at second hand. However, under the present scheme he will only hear from the Scottish Secretary what is going on; he will be less able to contribute to the debates in the Cabinet; and I should think that he would command less confidence in the Cabinet as regards knowing exactly what Scotland needs.
Therefore I believe that it would be very much to Scotland's advantage for the Secretary of State to retain control over the investment side of the Scottish Development Agency's activities. Of course, one must form a personal judgment. Whatever we do in this Bill there will be conflicts. However, I should have thought that it would be better to avoid increasing the possibility of conflict, as I believe second thoughts do as compared to the first. For that reason I personally am in favour of leaving out paragraph 7, and I hope that many of your Lordships will share my view. I beg to move.
The Earl of PERTH: My Lords, in my view this is a very crucial Amendment. As the noble Lord, Lord Drumalbyn, has said, it is a matter of opinion whether the Scottish Assembly and its Officers are to have some, even if it is very minor, influence on the economic happenings in Scotland or not. For my part, I think that the more the better, but I recognise
212
that as things are at present there is a considerable reluctance to go too far. However, the Assembly is pretty restricted in what it is allowed to do under the present clause. It is true that there might he a difference between the Government in Whitehall and the Assembly in Scotland, in the sense that they might be of different Parties, but that is something which can arise all the way through the Acts of the Assembly or the Acts of Westminster.
However, when we look at Clause 39, as the noble Lord, Lord Drumalbyn, said, we see that it states:
"The Secretary of State shall with the approval of the Treasury prepare guidelines".
So, all the initiative comes from Whitehall —indeed, not only the initiative, but the financial power which is really what counts. Not to allow within those guidelines or within that power for the Scottish Development Agency to operate with the Assembly seems to me to go to a point where the Assembly will have no sort of function to perform in what is really a key factor in the whole of Scottish progress and Scottish development. After all, the Assembly is on the spot and the Secretary of State for Scotland is quite a long way away. I am sure that it would be and should be easily arranged between the two—indeed, I am not sure that it is not already a necessary part of the whole—that what is happening in the Scottish Development Agency is known to the Secretary of State.
I think that the noble Lord, Lord Drumalbyn said that he would have to know the situation through the Scottish Secretary, but I am sure that for matters of convenience and of practice there would be an arrangement whereby it would be perfectly normal that they should both be informed of what is going on; otherwise there would he a situation where the guidelines, as it were, would he in a vacuum in relation to the activities. Therefore I very much hope that this limited power or limited function of the Assembly will be acceptable to your Lordships and that accordingly you will not accept the Amendment.
Lord TANLAW: My Lords, if I understood the noble Lord, Lord Drumalbyn, correctly, it would appear that the Scottish Development Agency is to be

213
hemmed in even more than it is already by directives, possibly cross directives, from Whitehall that conflict with its own investment policy. It appears to my noble friends on these Benches and to myself that if the Scottish Development Agency is to work effectively to provide employment and investment in Scotland that is soundly based for the future, then the management expertise that is available in the Agency should make these decisions as unencumbered as possible. I may need some help from the noble Lord, Lord Drumalbyn, because I do not see how directives from the Secretary of State will assist what is basically executive and investment decisions by those responsible for the investment programme of the Scottish Development Agency.
Lord DRUMALBYN: My Lords, I intervene to point out that someone will have to give those directions. The only question is whether it should be the Secretary of State or the Scottish Secretary who should give directions when they are required. I am thinking of grants and so forth.
Lord TANLAW: My Lords, if the noble Lord is talking about grants, then I am prepared to concede a point. What is worrying me—and I do not think that the noble Lord has taken this worry away—is that I cannot see how the investment decisions can he in any way enhanced by the Secretary of State or representatives from Whitehall trying to assist or interfere with them. It is my belief that those who are paid and employed as the directors and managing directors of the Scottish Development Agency carry the burden of their decisions and they must be proved for the future. I think that in any investment banking decision interference from an Assembly, albeit Parliament or another place, can only be deterimental.
It worries me considerably that those in charge of the Scottish Development Agency will, if I have understood the noble Lord correctly, to put it crudely be hen pecked from time to time by the Secretary of State or by members of the Assembly on the wisdom of those decisions. I believe that if that is the situation and if I have understood the noble Lord correctly, it will seriously weaken the operations of the Scottish Development Agency which
214
I and my colleagues on these Benches have supported from the outset. At this stage I am certainly not at all in favour of the Amendment, if it will have the effect which I am certain it will have if the noble Lord is successful.
Lord KIRKHILL: My Lords, let me at the outset acknowledge the close interest which the noble Lord, Lord Drumalbyn, has taken in the proposals concerning the Scottish Development Agency; the impressive degree of knowledge he has displayed about the provisions of the Scottish Development Agency Act, which is indeed complex; and the assistance which I believe he has given to your Lordships' House on what is now a number of occasions when we have been discussing the relevant provisions in the Bill, I am only sorry that the noble Lord's researches have led him to what is, I believe, an unduly pessimistic conclusion. I hope that what I shall now say may convince him that he should not, after all, press his Amendment.
The Scottish Development Agency was established with the purpose of bringing together under the same public corporation responsibility for furthering economic development and furthering the improvement of the environment in Scotland. Broadly speaking, the powers conferred on the Agency are available to it for both these purposes. When we came to consider devolution of the matters dealt with in the Scottish Development Agency Act, we were faced with the dilemma that the functions related to furthering the improvement of the environment, and matters which very closely related to the area of devolution; whereas the functions for furthering economic development were more closely related to regional and industrial policies, for which overall responsibility will remain with central Government.
From the first the Government have believed that it was essential to grant full devolution over the Agency's environmental functions, which include the provision of industrial sites and industrial estates. So far as I am aware, there has been no dissent from that conclusion, at least in your Lordships' House. However, full devolution was not an appropriate solution for the economic development function and the Government at no time

215
contemplated it. We started where the Amendment of the noble Lord, Lord Drumalbyn, would take us, by proposing no devolution in relation to the economic and industrial functions. That proposal was included in the Government's White Paper of November 1975. It met—and the noble Lord, Lord Drumalbyn, acknowledged this in his earlier remarks—with a great deal of criticism from a wide variety of responsible sources in Scotland and elsewhere.
These took the view that the Agency would be placed in an impossible position if it were to be separately responsible for different areas of its functions, the exercise of which might well he closely interlocked —indeed, inevitably so in particular cases—to two different masters. The view was very strongly urged that the Agency should be put entirely under the control of the devolved Administration. Accordingly, the Government looked at their proposals again in the light of this consultation. They decided that their special concern with the maintenance of consistent regional and industrial policies could be met if powers were devolved in relation to the non environmental functions, but subject to two provisos.
The first was that this devolution should he executive only. The second was that the exercise of the powers should be subject to guidelines laid down by, and variable by, the Secretary of State. As the researches of the noble Lord, Lord Drumalbyn, have demonstrated—at least, I think this is probably true—the drafting of the Scottish Development Agency Act is particularly closely knit. In order to implement their policy, therefore, the Government have had to do some very detailed and precise sorting out of the strands so as to be able to indicate in Schedule 10 to the Bill the extent to which matters dealt with in the various provisions of the Act are to he subject to the Assembly's legislative competence: and to indicate in Schedule 11 the particular ministerial powers which will pass to a Scottish Secretary but which the Assembly will have no power to modify. It is to the exercise of these latter powers that the guidelines will apply.
I have explained how the Government's original proposals of 1975 were widely
216
criticised. On the other hand, the present proposals in the Bill have been generally welcomed: indeed, it might be fair for me to say that the noble Earl, Lord Perth, would go rather further than the Government at this point. But at least he welcomes the general lines which the Government are taking as does the noble Lord, Lord Tanlaw. The Scottish Development Agency itself has indicated that it regards them as being entirely workable. From the Agency's point of view they have the great advantage that it will deal with the Scottish Administration alone. The Government are satisfied that the proposals provide an efficacious way of safeguarding reserved United Kingdom interests and s that they involve much less risk of friction and unco-ordinated action than does the divided responsibility which the noble Lord's Amendment would produce.
I hope that in the light of what I have said the noble Lord will consider whether the best interests of Scotland and the best interests of achieving a satisfactory devolution settlement will be served by the changes which he proposes. I would seriously say to your Lordships' House that the very reverse would be the case.
The Earl of LAUDERDALE: My Lords, since we last met in Committee I have done what homework I could, particularly as I had to absent myself from the latter stages of that last debate owing—as the noble Lord, Lord Kirkhill, is aware—to the arrival of some Lauder dales from America who required to be wined, dined and made welcome. Having read the report of that debate and having listened both to the noble Lord, Lord Kirkhill, and to my noble friend Lord Drumalbyn just now, I cannot help feeling that this matter is still in an awful muddle.
The noble Lord, Lord Kirkhill, has himself said, in effect, that the Scottish Development Agency Act is so tightly knit—I think that that was his phrase—so closely drawn, that it was (and he did not use this phrase, but I use it) almost a surgical operation to separate one lot of its activities from another. It may be that in all the circumstances there was no alternative—given the Government's intention of proceeding with this kind of Act and this kind of masquerade so far as economic powers are concerned—but for the Government to act in this way.

217
The noble Lord has just said that the SDA now say that they think this arrangement is workable. Those who hold offices of profit under the Crown are often wellattuned—I shall not put it any higher than that to the kind of answer which, in all the circumstances, it is best to give their masters. Frankly, I do not take too seriously the fact that they think the matter will work as it stands.
Surely what is quite clear is that the Secretary of State will continue to represent the economy of the United Kingdom as a whole, and do so by issuing guidelines. Those guidelines will be mandatory upon the Scottish Secretary—who may or may not be of the same political Party, but perhaps that is not as important a difference as it may seem—for practical purposes working the Scottish Development Agency Act under his new conditions. There will be divided responsibility; there will be division of opportunity as between Parliament, where Questions can certainly be put to the Secretary of State, and the Assembly, where Questions certainly will be put to the Scottish Secretary, even though these matters are out with the responsibility of the Assembly itself.
I think that the solution chosen by the Government encapsulates the dilemma of the whole Bill, which is how to give Scotland the appearance of control over its own affairs without in fact doing so. That is the heart of the matter. That is why I think that this Amendment is very important. At this moment I am not saying that I would urge my noble friend to press it, because I think that whatever one does in this matter is almost certain to be wrong. However, one thing that emerges is that surely the role of the Secretary of State for Scotland in Cabinet is somewhat diminished by all this. At the end of the day it is he who must always provide the ultimate influence on the Scottish economy. Therefore, I only hope that perhaps when the noble Lord, Lord Kirkhill, winds up by leave of the House, he will he able to make the matter a little clearer than he has done already. But it may be that mud cannot be made clear anyway.
4.40 p.m.
Lord DRUMALBYN: My Lords, I find that it is difficult indeed for me to reply to what has been said for the reason
218
that I myself am to blame because, in order to shorten the debate as much as possible, I did not go through what the paragraph provides. If anybody would like to rise now, other than the Minister from the Front Bench, and say exactly what the paragraph provides I should be very interested to listen to them.
I tried to make some kind of digest of it. The paragraph provides first of all that the appointment of the Agency itself will rest with the Scottish Secretary. That, for my part, I should not object to in the slightest. The second point is the requirement for the Secretary of State's consent in the exercise of the power to acquire, hold, and dispose of securities, form bodies corporate, form partnerships and make loans to guarantee obligations.
The third deals with the requirement for the Secretary of State's consent in the exercise of the power to make grants. The fourth point is the power to give directions in relation to the functions to which the noble Lord, Lord Kirkhill, referred in his speech—I think it was on 25th April—which are the central provisions in the Scottish Development Agency Act. These are the functions of the Agency in providing or assisting in the provision of finance, and so on. That is in Section 2(2)(a). The power to give these directions is obviously a matter of importance.
I was somewhat surprised at the line that the noble Lord, Lord Tanlaw, took on this. I should have thought it was obvious that the Scottish Secretary in Edinburgh is much more likely to interfere with the investment functions than the Secretary of State for Scotland has proved to do. However, we shall see. This is a question of judgment. It certainly was not my intention in any way to increase the amount of interference. Far from it. I entirely agree with him that investment decisions should be left to those people who are appointed to make them, and should be interfered with as little as possible. Still, the fact remains that there are these powers in the Scottish Development Agency Act to give directions in the exercise of those functions for the promotion of industry.
There is another power to give directions in relation to the power to acquire and hold securities, and so forth, and also

219
grants. There is the power to give directions on the charging for services, accepting gifts or grants, carrying out or commissioning investigations and inquiries in relation to the three principal functions of the Scottish Development Agency. One could go through the whole list. I think that those are the main points, although I should refer to the power to give consent, or a general authority, if the acquisition of shares in a company would carry with it 30 per cent. or more of the votes, or if the cost of the acquisition of the shares would exceed £2 million.
These are the kinds of powers involved and they do, under the Act, require consent. In the course of obtaining that consent the activities of the Scottish Development Agency are brought to the attention of whoever has to exercise those powers. I maintain that this is the best way of enabling the Secretary of State to see what is going on. It is extremely important that he should know what is going on and what are the capacities, powers, and so forth, of the people handling these things.
I do not think I need go further in describing the rest of the powers, because obviously if I am not going to press this paragraph there is not much point in our considering the detail of it. I got a little lost in following the noble Earl, Lord Perth, because we are not talking here about the Assembly at all except its incidental capacity, rather than function or power, to discuss anything it likes. It will most certainly discuss the guidelines that it receives and the activities of the Scottish Development Agency, and indeed reports of the Scottish Development Agency will be laid before the Assembly as the Bill already stands. Therefore, I do not think that, on balance, there is any reason to suppose that the Secretary of State would be more restrictive: indeed, I think exactly the contrary.
The noble Lord, Lord Kirkhill, referred to my researches. I was privileged, if that is the word, to take part in the debates on the passing of the Scottish Development Agency Act. I think that my noble friend Lord Campbell of Croy, took the leading part on that occasion. Therefore, this is a matter which is obviously of great interest to us all. I do not feel that I
220
should set up my judgment in this before the House and ask the House to express an opinion on it because, with the exception of my noble friend Lord Lauderdale—and I think that he rightly diagnosed what I felt about this—I do not seem to have received a great deal of support from this side of the House. But I must say again that that is because of the incredible complication of the way the Bill is drawn. If ever there was a case for a Keeling Schedule it should have applied in the case of the activities of the Scottish Development Agency.
Lord CAMPBELL of CROY: My Lords, will my noble friend give way? I would say to my noble friend that we have regarded him as the absolute expert on this complicated subject of the Scottish Development Agency. He and I were very much concerned with the Bill in 1975 when it went through. He has, in his most penetrating way, put all the points to the Government, and we have been listening to the reply. I do not think that there is an easy solution to it, but I would certainly back his judgment in these matters, although I agree with him that it may not be right to press this Amendment.
Lord DRUMALBYN: My Lords, apart from anything else, my own inclination in matters of this kind is rather to leave well alone. By that I mean that the system is working quite well under the Secretary of State at the moment and it is not necessary to make this change to bring into effect the second thoughts. It certainly is not necessary. It may be a convenience to the Scottish Development Agency to do so; it may even be a convenience to their customers in certain cases, but I should have thought that the best solution would have been for the Government to stick to their first thoughts on the broad grounds and not on the particular, narrow ground of the criticisms of this that have been expressed in Scotland. I have done what I can on this. I have expressed my opinion, and all I can do is to sit down and await the verdict of the House.
On Question, Amendment negatived.
[Amendments Nos. 159G and 160 to 165 not moved.]
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 166:
Page 74, line 21, at end insert (" and (f)").
The noble Lord said: My Lords, if it is for the convenience of your Lordships' House, as I believe it to be, I shall speak to Amendments Nos. 166 and 168 together. Both are technical Amendments in respect of the finances of the Scottish Development Agency and both deal with the same point. They close a gap in the devolution of Ministerial powers relating to the exercise of functions by the Scottish Development Agency. The gap occurs in the application of the power under Section 12 to determine financial duties of the Agency and of the powers in Schedule 2, which is concerned with financial arrangements. I beg to move.
On Question, Amendment agreed to.
[Amendment No. 167 not moved.]
4.50 p.m.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 168:
Page 74, line 28, at end insert ("and (f)").
The noble Lord said: My Lords, this is consequential on Amendment No. 166, to which I have spoken.
On Question, Amendment agreed to.
Lords KIRKHILL Lords KIRKHILL moved amendment No.169:
Page 75, leave out lines 10 to 18 and insert —
("2. The power under section 1(1)(d) of the Health and Safety at Work etc. Act 1974 to prescribe classes of premises, except so far as exercisable in relation to motor vehicles, aircraft, hovercraft or vessels.
3. The powers under sections 3(3), 5(1), 11, 12, 14(1) to (6), 15, 16, 18(2), 20(3), 27(1), 44, 45, 50 and 80 of that Act so far as exercisable in relation to the control of emissions into the atmosphere of noxious or offensive substances otherwise than from motor vehicles, aircraft or hovercraft.").
The noble Lord said: My Lords, this Amendment relates to the entry in Schedule 11 for the Health and Safety at Work etc. Act 1974. The policy is that this Act should, subject to certain exceptions, be devolved executively in respect of atmospheric pollution. The Amendment changes the existing entry in two respects. First, it reserves the Act entirely in respect of motor vehicles, aircraft and hovercraft; pollution from all of these is closely connected with manufacturing standards, and is already reserved in other contexts in the Bill. Secondly, while atmospheric pollution from ships in territorial waters is generally
222
to be devolved, the Amendment reserves the power under Section 1(1)(d) to prescribe classes of ships as being premises to which the provisions of that Act apply. Thus it will be for the Secretary of State to apply the Act to ships, but for the Scottish Executive to make subsequent regulations.
Lord GRAY: My Lords, I have a technical question about the wording of the Amendment. I have frequently been surprised and sometimes concerned about the uses to which the word "premises" can be put. Today my concern is with the words used for the exclusions here. In the Amendment we find exclusions in relation to motor vehicles, aircraft, hovercraft or vessels. In the Health and Safety at Work etc. Act 1974 the relevant provision reads:
…any vehicle, vessel, aircraft or hovercraft".
Is there any significance in the use of the word "motor" to qualify "vehicles" in this case? I ask this question only because we had considerable difficulty almost a year ago today with the use of the word "vehicle".
Lord KIRKHILL: My Lords, off the cuff I am unable to give the kind of expert reply to which the noble Lord is entitled, but I will consult my advisers and communicate with him
On Question, Amendment agreed to.
Lord KIRKHILL Lord KIRKHILL moved Amendment No. 170:
Page 75, line 18, at end insert—
("3A. So far as they relate to vessels other than those in inland waters, the powers under:—

(a) sections 32(1) to (3) and 36(1) of the Public Health (Scotland) Act 1897;

(b) sections 6, 8, 146(1) 148, 149 and 178 of that Act (so far as they relate to sections 16 to 27, 29 to 32 and 36 of that Act);

(c) section 1(2) of the Clean Air Act 1956; and

(d) the Control of Pollution Act 1974 (other than those under sections 30(5), 75 to 77 and 100 to 103).")

The noble Lord said: My Lords, this Amendment which concerns pollution from ships in territorial waters, follows on the earlier Government Amendment, No. 116, to paragraph 8 of Part II to Schedule 10. It involves no change of policy, but seeks to achieve more clearly

223
what the Bill previously sought to achieve by means of paragraph 8.
On Question, Amendment agreed to.
Clause 62 [Reservations]:
The Earl of SELKIRK The Earl of SELKIRK moved Amendment No. 171:
Page 30, line 26, leave out subsection (1) and insert—
("(1) It is hereby declared that the power of clemency is not devolved.")
The noble Earl said: My Lords, subsection (1) of this clause states:
"The prerogative of mercy is not a devolved matter".
I should have thought that the rule of silence, which we have been told, I will not say ad nauseam but certainly on a number of occasions, means that a matter is reserved, in turn means that this subsection need not appear at all. It would be quite sufficient to leave it out because it is obvious that unless the power of clemency is devolved, it remains where it is now.
However, there is objection to the use of the words as drafted. We have already discussed the subject of prerogative and it has been left out of Clause 21(1) because it is inappropriate to devolve a matter of prerogative, and for the very good reason that these are powers which cannot be made subject to law by devolution. We are substantially agreed on that. If, therefore, the Minister wishes to make a declaratory statement—I do not think it is necessary for him to do so, but if he wants to make such a statement—I suggest he uses words on the lines of those in my Amendment. I have used the words:
"It is hereby declared that the power of clemency is not devolved".
I am not saying they are necessarily the only words, but I believe they are sufficient for the purpose the Government have in mind. I believe it would be better to leave out subsection (1) altogether, but it is objectionable in the form in which it is drafted now.
Lord McCLUSKEY Lord McCLUSKEY: My Lords, the first matter to which I should address myself is the remark of the noble Earl, Lord Selkirk, that the rule of silence applying here would mean that one does not need to have any such provision as is
224
now contained in subsection (1) of this clause. I invite the noble Earl to look with me at the group in Schedule 10 relating to the criminal law generally, Group 25, where he will see that legislative competence is devolved in relation to a number of subjects included in that group and he will find that it includes in line 18, criminal penalties; in line 19, the treatment of offenders; and in line 23, the enforcement of court orders.
In relation to one or other, I believe to all, of these subjects it would be possible to say that, if there were no reservation then legislative, not executive, competence in relation to what is embraced in the prerogative of mercy would in fact be devolved. I refer particularly of course to the treatment of offenders and criminal penalties. If legislative competence in relation to criminal penalties were devolved and there were no reservation, then surely it would be competent for the Assembly to legislate in order to allow the remission of criminal penalties; one would think that would be included. It would apply equally, I would say, to the enforcement of court orders; if a court orders that a person shall be imprisoned or that a fine shall be paid or that it shall be paid within a specific time, then the remission of the fine or the alteration of the time might be a matter which could be regarded as an exercise of the prerogative of mercy. I believe therefore that, unless there were some reservation, legislative competence would be devolved.
I do not think there would be any devolution of executive competence because here we would be looking at Clause 2I—we had a detailed look at that on an earlier occasion—and that clause is concerned with the devolution to Scottish Secretaries of powers which would be exercisable on behalf of Her Majesty by a Minister of the Crown. Lord Selkirk and I are agreed that, so far as the prerogative of mercy is concerned, the power there is exercised by Her Majesty on the advice of Ministers, so that is not included in Clause 21. But the reason for a reservation is that legislative competence would appear to be devolved by the words to which I have drawn attention.
The noble Earl then drew attention to the use of the words, and we have had a number of debates about that; but I

225
invite attention to how the words are used in Clause 62. We say:
"The prerogative of mercy is not a devolved matter".
In other words, we are not purporting to make the prerogative of mercy a devolved matter; we are not proposing to legislate about it. We are proposing not to legislate about it, so it is the very reverse of including it in the statute. I believe that that is the correct way to do it.
I have looked into the matter to see whether this has been done before, and the best example to which I can draw attention is in Section 263 of the Criminal Procedure (Scotland) Act 1975, which was a consolidation Act. Section 263 is a section which is specifically reserved in Part III of Schedule 10 of this Bill. The opening words of Section 263 are:
"Nothing in this Part of this Act shall affect the prerogative of mercy".
I believe that that is a very similar kind of provision to the one that we have here. In that Act it is stated that nothing,
"shall affect the prerogative of mercy",
and in this Bill it is stated that,
"The prerogative of mercy is not a devolved matter".
I think that the difference in wording derives from the different concept of the Bill, but in substance it is the same kind of provision.
I come now to the next matter. The noble Earl suggested that, if we wished to make a declaratory statement, we might do so in the terms of his Amendment, but I fear that that would not do. I do not believe that the phrase "power of clemency" in the Amendment can properly be described as a term of art. First, I believe that it is possibly too wide. The first definition of clemency as given in the Shorter Oxford English Dictionary is:
"Mildness or gentleness of temper in the exercise of authority or power; mercy; leniency".
I believe that clemency could therefore properly include, for example, the exercise of a power to grant parole. Equally, I believe that it might include the exercise of a power to allow a reduction in a fine, or a delay in the payment of a fine, which is the kind of thing which is done daily in the means inquiry courts in Scotland, as the noble Earl will know. Indeed, I
226
suppose that a remission to a prisoner for good conduct would be regarded as an exercise of leniency, and therefore of the power of clemency. Therefore, I must criticise the wording in the Amendment as being not sufficiently precise. I defend the wording in the Bill upon the basis that I have outlined, and I invite the noble Earl not to press the Amendment.
The Earl of SELKIRK The Earl of SELKIRK: My Lords, I was saying that the Bill says that it will not devolve the prerogative, and so, as there is not power to devolve the prerogative by Statute, one is saying that one will not do what one cannot do. I believe that that is silly, and that is the reason why I raised this matter. Would the noble and learned Lord agree to include what is stated in the Criminal Procedure (Scotland) Act 1975? Would he agree to the words:
"Nothing in this Act shall affect the prerogative of mercy"?
Those are the words used in the Act to which he referred. I hope that he would agree to include those words, because I believe that they would be more apt, and they would meet precisely what he is trying to say. I am not arguing about the merits of this matter—I am in agreement with the Government—but I think that the words are inappropriate. I shall not press the noble and learned Lord for an immediate decision, though possibly he would like to give one. However, if he would consider my suggestion, it would give me great pleasure. Perhaps that is not a good enough reason, but I leave the matter at that, and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
5.4 p.m.
Lord HARMAR NICHOLLS Lord HARMAR NICHOLLS moved Amendment No. 171A:
Page 30, line 28, after ("country") insert ("or group of countries").
The noble Lord said: My Lords, I think that we can take Amendments Nos. 171A and 171B together. If I am able to persuade the noble and learned Lord on this occasion, then it will be the first time that he has agreed with me. It will be rather pleasant if he is prepared to say that he accepts the Amendments. That would be quite different from what we have had for days and clays, during

227
which it has been a case of, "No, No." If on this occasion the noble and learned Lord is prepared to accept what I propose, he may save the State and many people much money.
The words as they stand in the Bill here are all right, but they leave room for doubt. There could be doubt if there is a reference to Lords of Appeal for a decision on what the Bill means, if it ever becomes a Statute. Clause 62(2) states:
"To the extent that a matter involves the conduct of relations with any country outside the United Kingdom it is not a devolved matter".
I suggest that, if the provision is left as it stands, the words "any country" may not cover a group of countries. I have in mind, for example, the European Community. It could well be submitted that in this context a group of countries—perhaps this might arise in connection with laws coming from the Community—would not be deemed to be the same as any one country in terms of the conduct of relations. I want to try to make it crystal clear that this matter is not devolved to the Assembly, but remains a matter absolutely for Westminster. If the words proposed in my Amendment were inserted, the subsection would begin:
"To the extent that a matter involves the conduct of relations with any country or group of countries"
and, if the words proposed in Amendment No. 171B were included, the subsection would continue,
"outside the United Kingdom or with the European Community"
That would put beyond any doubt what exactly is meant.
I would not argue with any strength that the present words, if challenged, would not be deemed to mean what I am trying to make them mean by the addition of the words that I propose, but by leaving this matter in the singular—by referring to relations "with any country"—and by leaving the reference to "outside the United Kingdom" as it stands, there really is a doubt. Someone who wanted to push a point to the ultimate could perhaps get round the wording as it stands, and that could be very expensive.
What I propose does not affect the sense of what the noble and learned Lord already has in the clause. I merely wish to add a few words which would remove a
228
doubt which I have, as do one or two people with whom I have discussed the matter. I hope, in view of the fact that on this occasion we are so close to agreeing that the present wording is more or less right, that the noble and learned Lord will accept the additional words, and thereby create a precedent, in that for the first time in these long and weary debates he will have said "Yes" to me. I beg to move.
Lord McCLUSKEY: My Lords, I agree entirely with what the noble Lord, Lord Harmar-Nicholls, said at the start of his speech, when he said that the words as they stand are all right. I am afraid that beyond that I have to say "No" to him. The words which the noble Lord seeks to add to Clause 62 (2) are unnecessary. The subsection as it stands, by debarring the devolved Administration from the conduct of relations with any country outside the United Kingdom—I draw attention to the word "any"—is already entirely adequate to debar the conduct of relations with the European Community, or with any group of countries such as may be found within an international organisation.
I believe that my noble and learned friend the Lord Chancellor dealt fully in Committee with the relationship between the devolved Administration and the organs of the European Community. He said, as reported at column 1097 of the Official Report of 10th May, that he could not
"emphasise too much that participation in meetings of the Commission and of the Council of Ministers, where the decisions will be made, is a matter for Member States, and so far as this country is concerned will be a matter for the United Kingdom Government".
We believe that that is adequately secured by the subsection as it stands, and it is unnecessary to insert the words in order to remove the doubt which lingers in the mind of the noble Lord. I am not quite clear in what circumstances he envisages that the matter would come to be resolved by Lords of Appeal, but I am advised—and I agree with the advice offered to me—that, should that happen, the present wording makes it quite clear that any attempt by the devolved Administration to conduct relations with a country, or a group of countries, or an organisation including a number of countries (such as the EEC, or the like), would be debarred. That is the plain sense of subsection (2),

229
and therefore I believe that it would be better to leave the words as they stand.
Lord HARMAR NICHOLLS: My Lords, the noble and learned Lord, on this occasion as on any other occasion, has taken cognisance of what his senior in Government has said. The Foreign Secretary is on the record as using words which more than imply that the Assembly may well be taken along to the European Community. We have also had the Secretary of State for Scotland, who has said that he can well see that direct contact will be made with the Assembly in Scotland. The noble and learned Lord, Lord McCluskey, quotes the noble and learned Lord the Lord Chancellor giving his view, but in terms of political precedence the Foreign Secretary and the Secretary of State for Scotland are the ones who have left this doubt in my mind.
My Lords, if my extra words did anything more than strengthen what the noble and learned Lord has said that he wants, I would not have bothered him with them. They can do no harm, and could do good. The ideal bet to be on, as the noble Lord, Lord Wigg, will tell your Lordships, is a bet where you can win and cannot lose; and my words put the noble and learned Lord and this statute in precisely that position. Accept my words and there is no shadow of a doubt at all, Foreign Secretary or no Foreign Secretary, Secretary of State or no Secretary of State. Why my Amendment is not accepted I do not know, but I am obviously not going to get anywhere on it. I do not know whether any other noble Lord feels that the point is worthy of pursuit, but, if not, then I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
[Amendment No. 171B not moved.]
Schedule 12 [Legal proceedings involving devolution issues]:
5.12 p.m.
Viscount COLVILLE of CULROSS Viscount COLVILLE of CULROSS moved Amendment No. 172:
Page 76, line 30, after (" Act ") insert (" or instrument ").
The noble Viscount said: My Lords, I hope that the House will allow me to set the context of this Amendment, and indeed Amendment No. 173, because it
230
is a fairly complicated Schedule and it evoked from noble and learned Lords sitting on the Cross Benches a good deal of debate at Committee stage. The point of the Schedule, as I understand it —and the noble and learned Lord will at once tell me if I am wrong—is that, where one has in an ordinary action what is called a devolution issue, the Schedule provides an optional course whereby one can have an accelerated appeal without going through all the ordinary stages right from the bottom of the judicial system to the top. As the Bill now stands after discussion in debate, the appeal by that accelerated method will still go to the Judicial Committee of the Privy Council.
Of course, the advantage of an accelerated appeal procedure is that the unfortunate litigants do not have to fight the point out in court after court, none of which has anything much to go on and all of which know that, in the end, it is very probable that the matter will have to be decided by the final court of appeal, which will be either the House of Lords in ordinary cases or the Judicial Committee if it is done in that way. So it is a great saving; and, of course, it is not only a saving for the private purse but, if the matter is legally aided, it is a saving on the public purse as well. So I thoroughly approve of the accelerated procedure.
Now, my Lords, what are the devolution issues which can be taken up by means of this procedure? There are two in paragraph 1 of the Schedule. First of all, there is the straight issue of whether either the whole or any part of a Scottish Assembly Act is within the legislative competence of the Assembly; in other words, this is the issue of whether they have gone outside the powers given them by the Scotland Bill. The exception will be if it is a matter which has been looked at on a pre Assent reference to the Privy Council, where we have now slightly altered this, but normally speaking that will all be open for debate. Secondly, there is
"a matter with respect to which a Scottish Secretary has purported to exercise or proposes to exercise a power "
which is given him under this Bill.
Now, if one looks back for a moment to the three provisions which provide for

231
political override, which are Clauses 36, 37 and 38, one sees that, instead of there being two matters set out—that is, the straight legislative ability in an Act and the powers of the Scottish Secretary—we find a third category which relates to Statutory Instruments. That is not reproduced in Schedule 12, and the question therefore arises whether Statutory Instruments can ever be the subject of the accelerated procedure under Schedule 12.
This, again, requires a little thought, because I should have anticipated that not all matters which give rise to vires—to the question whether a Statutory instrument is within the powers of the maker of it—would necessarily be devolution issues, even if they arose under the Scotland Bill. For instance, if the Scottish Assembly or the Scottish Secretary is given powers to make a Statutory Instrument —as indeed is the case, by virtue of pre existing United Kingdom legislation which we already have on the Statute Book—but the power to implement it, to amend it or to do something by way of subordinate legislation under it so far as concerns Scotland is merely transferred to the Scottish Assembly under this Bill, then, if there is any question whether the subordinate instrument so made goes beyond the powers of the enabling United Kingdom legislation, that would not, as I understand it, be a devolution issue in any event. It would fall to be dealt with by the ordinary methods of the courts, and it could not be the subject of the accelerated procedure even if one wanted it to be.
The next sort of Statutory Instrument would be one which was made under a Scottish Assembly Act which was in itself perfectly infra vires—nothing whatever wrong with the Act—but where the citizen in Scotland wished to complain about the Scottish subordinate legislation on the grounds that if fell outside the powers granted by the Scottish Assembly Act. That also would not give rise to a devolution issue in any way, and that, too, would have to be taken up the court structure in Scotland in the course of normal litigation.
However, there is a third sort of Statutory Instrument which could, I think, occur. It is a case where a Scottish Assembly Act has been passed and there is
232
nothing whatsoever wrong with the Act itself; where nobody can question that it goes beyond the powers given to the Scottish Assembly under the Scotland Act 1978. In order to illustrate this, let us take for a moment an example from Schedule 2, paragraph 4, as I think an illustration helps in this argument. Suppose that the Assembly indeed wished to pass legislation altering the form of the local property tax from a rate as everybody knows it now to some other local tax substantially of the same character. In other words, though I do not know what sort of tax they might substitute for the present system, they might have something which is slightly different from rates as we now know them.
There would be nothing whatsoever wrong in the Scottish Assembly passing a Bill to do that, because they are expressly told in Schedule 2 that they can. However, one of the difficulties about laying down the details of local property taxation is that it is all right for houses, factories and all the other ordinary sorts of building that everyone is familiar with; but when you get on to difficult things like gasworks, water undertakings, the railways and things which do not happen in only one place but spread themselves across the country, and you have to apportion the amount of local property tax that is going to be paid in any local authority area—and, indeed, the Coal Board comes into the same category as well—you rather tend to have formulae. You certainly have them under the rating enactments, and it would not wholly surprise me if, under some substitute system of local taxation, the Scottish Assembly decided that they would not try to make their legislation completely consistent but would also be prepared to adopt formulae for certain specialised hereditaments of that sort in Scotland.
Very often when this sort of exercise is being carried out it is much too cumbersome to put into the legislation itself. One has only to look at the Schedules to the General Rate Act 1967 for England and Wales to see what happens when you start putting cumulo valuations on water undertakings, and all the fractions and things, into the primary legislation. So provision is very often made to deal with this by Statutory Instrument. In due course, therefore, along may come a Scottish Secretary presenting to the

233
Assembly a piece of subordinate legislation which sets out how to rate the water undertakings. At that point, the water undertakings wish to challenge the Statutory Instrument, not on the grounds that the Act from which it derived went beyond what was within the legislative competence of the Scottish Assembly but on the grounds that the subordinate legislation falls outside what is contemplated by Schedule 2, paragraph 4, to the Scotland Bill.
It seems to me that one could say that that would also be outwith the competence of the Assembly under the Scotland Bill itself, so that one could certainly deal with it in the courts in the ordinary way. But if the main complaint is not that, but that it goes outside what has been devolved under the Scotland Bill itself, it is the sort of thing that ought to be a devolution issue and subject to the accelerated appeal procedure. In order to cover this, I have put down these Amendments. I hope that they are in the right form but I dare say that I shall be told that they are not.
My Lords, those who look at Statutory Instruments, I think, are in some doubt whether they are, indeed, subordinate legislation or whether they are the exercise by a Scottish Secretary of a power. Let us suppose, for instance, that we take the ordinary case of the Affirmative Resolution procedure in this House. A Minister comes along and presents a draft order; he speaks to it and the Opposition or anybody else may make a speech on the Motion eventually put to this House: That, the order be made. Is that legislation or is it the exercise of a power by a Secretary of State or a Minister in this country under the Constitution as it now exists?
I am not sure even that the Statutory Instruments Act 1946 entirely clears this up. If there is any doubt about it, then I wish to make sure that we set the doubt at rest by including the necessary words in the Bill. At the moment, I am not sure that paragraph 1(b) of this Schedule goes wide enough to deal with all sorts of Statutory Instrument which might be made by the Scottish Assembly, perhaps under procedure similar to our own Affirmative Resolution procedure, and which it might then be wished to challenge along the third line of the argument which
234
I mentioned. I hope that that is not too involved or too far fetched. I think that it could easily happen, and if it did happen I should like the quicker, cheaper accelerated procedure to be able to apply, to save everybody a great deal of time and trouble. I beg to move.
5.24 p.m.
Lord McCLUSKEY: My Lords, the Government believe that this Amendment is unnecessary. We have corresponded with the noble Viscount but so far have been unable to persuade him. What the Amendment seeks to do is to extend paragraph 1(a) of Schedule 12; and paragraph 1(a) of Schedule 12 is the paragraph which brings within the general expression "devolution issue" the question whether a Scottish Assembly Act or any provision thereof is within the legislative competence of the Assembly.
We rely, in relation to subordinate Instruments, upon paragraph (b) which is concerned with the exercise, or the purported exercise, of a power by a Scottish Secretary. I was asked a moment ago in relation to the making of some kinds of subordinate Instrument whether it is legislation or the exercise of a power. In a sense, that is a question that one does not need to answer; because if it is legislation it is caught by paragraph 1(a) and if it is the exercise of a power it is caught by 1(b). In either case it is a devolution issue within the meaning of that term as defined in Schedule 12.
Viscount COLVILLE of CULROSS: My Lords, I do not think that I am quite as dim as that. Paragraph 1(a) talks about a Scottish Assembly Act and not Scottish Assembly legislation.
Lord McCLUSKEY: My Lords, I really must be very dim to miss altogether that distinction between a Scottish Assembly Act and Scottish Assembly legislation.
Viscount COLVILLE of CULROSS: My Lords, I must make this plain. The noble and learned Lord said that if the subordinate Instrument is legislation it is caught by 1(a). What I am saying is that it is not. Paragraph 1(a) refers to a Scottish Assembly Act and not to a piece of Scottish Assembly legislation.
Lord McCLUSKEY: My Lords, is there a distinction? It does not exist. Surely the point is that either the Scottish Assembly passes legislation in the form of an Act or else it passes an enabling Act under which the Scottish Secretary makes a subordinate Instrument. That is the only kind of subordinate Instrument that we are concerned with in this Bill.
If one looks at Clause 38(1) that becomes absolutely plain. It is the kind of thing we are talking about because Clause 38(1) is concerned with such Instruments. It reads:
"If it appears to the Secretary of State that an instrument made by a Scottish Secretary under any Act of Parliament or Scottish Assembly Act affects a reserved matter "—
then he (the Secretary of State)—
"may by order revoke the instrument".
I do not see that there is anything in between Assembly legislation, on the one hand, and a subordinate Instrument made by the Scottish Secretary and approved by, or not disapproved by, the Assembly in terms of the powers conferred by a Scottish Assembly Act. With the concept which is involved here in paragraph 1 of this Schedule is the concept of a power; and we believe that that is wide enough to cover any power to make a subordinate Instrument and, at the same time, the power to undertake executive action—although the noble Viscount does not challenge that that is covered by this provision.
He is concerned, as he has explained, with an Instrument which strays outside the limits of the legislative competence of the Assembly. He certainly offered us certain examples. Let me illustrate this in relation to one which is very plain, I think, on the face of the Bill itself. Under Schedule 10, Group 3 gives a power to give grants to educational institutions.Prima facie, therefore, if a Scottish Assembly Act were to be passed empowering a Scottish Secretary to make such a grant, that would, on the face of it, be intra vires. Paragraph 3 of Part II of the same Schedule, in effect, says that he cannot make a grant to a university. If, in a purported exercise of the power conferred by the enabling Act, he decided to make a grant to a university to set up a Faculty of Building, or whatever, that would be an exercise of a power to make a subordinate Instrument which would be
236
caught by paragraph 1(b). I do not think that the noble Viscount would dispute that. That is how we see the thing working.
We believe that the kind of case he is figuring—and he figured it in relation to altering a rate into a local tax—is covered. The other example he gave was formula rating. I accept what he says that this would not be done normally by primary legislation but by the making of some order. Unless he is right in his suggestion that that order is somehow not legislation as an Act (which it would not be) and is not either a subordinate Instrument made by the Scottish Secretary and that there is some halfway house between the two, his proposition falls. I do not see that this halfway house exists under the Bill. If the noble Viscount thinks that it exists, then I should be indebted if he would demonstrate it by reference to some provision in the Bill which entitles this kind of Instrument to be made which is made not by the Scottish Secretary and does not fall under the general description of legislation, "Scottish Assembly Act" being the wording contained in paragraph 1(a).
My Lords, I was going to criticise the precise wording contained in the Amendment because I could not see how an Instrument could be within the legislative competence of the Assembly. I thought that that was not proper. I see now that it derives from the noble Viscount's understanding that there may be some halfway house between a Statutory Instrument made by the Scottish Secretary, on the one hand, and a Scottish Assembly Act. I cannot follow him in discovering that "creature". Accordingly, it is for that reason that I reject the Amendment. I believe that this is an unnecessary Amendment and one liable to cause confusion. I have sought and obtained advice from Parliamentary counsel of course and, in the circumstances, I would recommend the House not to accept this Amendment.
Viscount COLVILLE of CULROSS: My Lords, I sought to give the noble and learned Lord exactly the example for which he asked: the case of the draft order which was brought forward under the Affirmative Resolution procedure. One will not find such a thing in the Bill, because a system of that kind would be a

237
matter that the Scottish Assembly would organise for themselves and it would be perfectly within their competence to do so as part of either their standing orders, or, I suppose, if necessary, by means of some Act to provide for it as we have at present in the United Kingdom.
The point is this: if the noble and learned Lord is absolutely satisfied—and he says he is—that there is no gap here and that the case either he gave or I gave by way of example is covered, then there is no need to pursue the matter. I do not want to put unnecessary words in the Bill which the Government do not approve and which will not add in any way to the coverage which we provide.
Since the noble and learned Lord is plainly convinced that we will be able to use the accelerated appeal procedure in either of the cases that have now been quoted, there is nothing further to go on, and I just hope that the courts interpret the legislation in the same way that he and I have done because unfortunately they are not allowed to look at Hansard.We hope that the drafting will stand up. I should like to thank the noble and learned Lord for the full explanation. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
[Amendment No. 173 not moved.]
5.32 p.m.
Viscount COLVILLE of CULROSS Viscount COLVILLE of CULROSS moved Amendment No. 174:
Page 79, line 19, at end insert—
(" Institution of proceedings
(18A) Without prejudice to any power exercisable apart from this paragraph, proceedings for the determination of a devolution issue may be instituted by the Attorney General for Northern Ireland and defended by any person who, as a Scottish Secretary or assistant to a Scottish Secretary, performs functions corresponding to those performed by a Law Officer of the Crown.").
The noble Viscount said: My Lords, this is a very short point and it is one which we raised before. The Government were good enough to say that they would look once more at that matter to see whether they would like to change their minds. It is almost entirely upon their own head if they do not do so, although some unfortunate citizen may possibly be disadvantaged. The proposition is simply
238
this: if a point about the vires of a Scottish Assembly Act or the exercise of a power —whatever that may now be—by a Scottish Secretary is raised in the ordinary litigation, of course there is no very great difficulty and the Law Officers may intervene. They may also institute the proceedings themselves if they wish to do so even in advance of anybody else taking the point before the courts.
That is so in England and Wales and it is so in Scotland; but it is not so in Northern Ireland for one simple reason: that the Government have said so far that they cannot conceive of any situation arising whereby the Law Officers would wish to raise the question of the vires of Scottish legislation,et cetera—if I may put it that way—in a Northern Irish court.
I agree—and I think the noble and learned Lord argued this—that it is improbable; I do not think that it is going to happen very often in either English or Welsh courts so far as that goes. The fact of the matter is that the law in various parts of the United Kingdom is not exactly the same, and the law in Northern Ireland is not exactly the same as the law on this side of the Irish Sea. I can conceive that it is possible that an occasion will arise when the Law Officers will wish to pre-empt any further argument and take a point in front of the Northern Irish courts.
If they are not allowed to do that the expense is bound to fall upon the private citizen, if one can be found to be sufficiently concerned with the matter to raise it at all in the courts and to have the locus to raise it in the courts, or it will simply remain unresolved and the Government will not know where anyone is and will have no method of testing it. I cannot see what harm it would do to provide exactly the same provisions for the Northern Irish Attorney General as is provided for him in England; it is the same person. In Wales it is the same person, and it is the Lord Advocate in Scotland. That is all I am trying to do. I hope that the Government might round the circle and make this complete. I beg to move.
Lord HYLTON: My Lords, the kind of issue which my noble friend has in mind might arise in connection with the Stranraer to Larne ferry or in general

239
with the commerce which goes on between Scotland and Northern Ireland.
Lord McCLUSKEY: My Lords, I do not think that anyone would dispute that there could be a situation in which a problem would arise involving a question of the competence of an instrument made under the Scotland Bill on the one hand, and some issue elsewhere in the United Kingdom relating to that. The proposed paragraph to this Schedule is concerned with the bringing of proceedings by the Government Minister. However, our argument has always been that it would not do any good to put this in; but we have to accept that it cannot do any harm and, rather than take up time in arguing, I propose to accept the Amendment.
Viscount COLVILLE of CULROSS: My Lords, for once the noble and learned Lord did not write and tell me that, so I am extremely grateful and surprised.
On Question, Amendment agreed to.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 175:
Page 80, line 7, at end insert—
("Effect of decision of Judicial Committee on subsequent proceedings
. A decision of the Judicial Committee of the Privy Council in proceedings under this Schedule shall be binding in all subsequent legal proceedings.").
The noble and learned Lord said: I referred to this Amendment when dealing with earlier Amendments (I think Amendment No. 38 and others) and it is simply to make the decision of the Judicial Committee of the Privy Council binding in post Assent cases as well as—as we have already secured by the other Amendments—in pre Assent cases. I beg to move.
Viscount COLVILLE of CULROSS: Again, I should like to thank the Government. They have taken a great deal of trouble in meeting noble and learned Lords and myself and trying to produce an agreed solution to this matter. As the noble and learned Lord said, this is part of the overall solution which I am very happy to see now in the Bill.
Lord WEDDERBURN of CHARLTON: My Lords, perhaps my noble and
240
learned friend has already dealt with this matter and, if he has, I apologise. But is it the intention of the Amendment that the Judicial Committee should always be bound by its own decisions? When the Appellate Committee of the House of Lords gave themselves permission in 1966 to depart from their own precedents, on reflection, I wonder whether there might not arise an occasion when the Judicial Committee of the Privy Council will wish to reconsider a precedent of their own, and the words "binding in all subsequent legal proceedings" appear to mean that the Judicial Committee bind themselves. I may be wrong in that and no doubt my noble and learned friend will tell me if that is so.
Lord McCLUSKEY: My Lords, my noble friend may recall that we debated this matter along with the other Amendments to which I have referred. The equivalent Amendment was No. 52 and that was to the effect that a decision of the Judicial Committee in pre assent proceedings was to be binding in all legal proceedings. I agree with him in the construction of this: it means that the Judicial Committee decision binds the Judicial Committee in future. Of course we know that the House of Lords have declared themselves unshackled by precedent; but in this particular context where the Judicial Committee have, either pre Assent or post Assent, considered a particular provision and declared that that provision of the Scottish Assembly Act is intra vires and therefore the provision can stand, we agreed after discussion with the noble and learned Viscount, Lord Dilhorne, and the noble Viscount, Lord Colville of Culross, that on balance this was a compromise that we could properly accept.
Those in favour of post assent review and preserving the rights of the citizen and the development of the law achieved most of what they wanted. There was a slight retreat from complete equivalence to what is done in the House of Lords and in ordinary proceedings, and that was enshrined in Amendments Nos. 52 and 175. It was justified on the basis that they were talking about validity of legislation which was to apply in Scotland and upon which people in Scotland should

241
like to place reliance. That is the justification, but my noble friend's understanding of the provision is correct.
On Question, Amendment agreed to.
5.40 p.m.
Earl FERRERS Earl FERRERS moved Amendment No. 176:
Before Clause 64, insert the following new clause:
Voting of Scottish Members of Parliament
(".—(1) Subject to subsection (2) of this section, if, following the first meeting of the Scottish Assembly, a Bill to which this section applies has been passed by the House of Commons but there would not have been a majority in support of the Bill if there had been excluded from the members who voted in the division of that House on the question that the Bill be read the Third time all those representing parliamentary constituencies in Scotland, that Bill shall be deemed not to have been read the Third time unless after the next fourteen days on which that House has sat after the division took place that House confirms its decision that the Bill be read the Third time.
(2) Subsection (I) of this section shall not come into operation unless it has been approved by a resolution of the House of Commons.
(3) This section applies to any Bill which does not relate to or concern Scotland or any part of Scotland.").
The noble Earl said: My Lords, the noble and learned Lord is evidently in an accommodating state of mind: he has met my noble friend over the last Amendment and he accepted the one before. I hope that this entente cordiale will continue and that he will feel disposed to accept my Amendment.
Your Lordships will recall that at the Committee stage my noble friend Lord Selkirk moved an Amendment standing not only in his name but in the names of the noble Lords, Lord Duncan Sandys, Lord Houghton of Sowerby and Lord Shinwell. That Amendment sought to meet the problem which has become known as "the West Lothian Question". After the passing of this Bill, as at present drafted, the domestic affairs of Scotland will be devolved to the Assembly and so will no longer be the direct responsibility of Members of Parliament at Westminster. Yet the domestic affairs of England and the remainder of the United Kingdom will still remain the responsibility of the Westminster Parliament and therefore will continue to be affected by the views and votes of Scottish Members of Parliament. So we get the curious, inequitable and, to some, intolerable
242
situation that Scottish Members of Parliament, while not being able to control the domestic destinies of their own country, will be able to have an influence, and possibly have a controlling influence, over the domestic destinies of England, while the English Members, in turn, are denied the equivalent influence over the same matters when they affect Scotland.
This is a fundamental inequity, and indeed injustice, which this Bill has constructed. Whatever our views on devolution may be, I think it is universally recognised that this is an inequity. It has constantly been referred to, and yet the Government have made no attempt to resolve it. However, I feel that I owe the noble and learned Lord, Lord McCluskey, an apology because during the Committee stage when the Amendment to which I have referred was being discussed, the noble and learned Lord said that I called this a "blessed" Bill. I remonstrated and said that what I had called it was a "bizarre" Bill. However, the noble and learned Lord was, for once, quite right and I apologise for having corrected him. I feel I should add that, although I did call this a "bizarre" Bill, the record shows quite clearly that I also called it a "blessed" Bill—though I hasten to add not in the gracious sense to which the noble and learnd Lord was tempted to attribute it but more in a sense of frustration rather than of a beatification. Nevertheless, I unreservedly apologise for having been wrong on that occasion and having corrected the noble and learned Lord in that fashion.
At Committee stage the Amendment moved by my noble friend Lord Selkirk was considered defective, and I undertook to try to produce an Amendment which sought to meet not only the principle of the Amendment but also the objections to it. It is this Amendment which I venture to put before your Lordships today. I might say that it has been particularly difficult to draft, because the way in which the Bill is drawn up makes it almost, but fortunately not totally, un-amendable in this respect.
Perhaps I might explain what the Amendment does, why it does it, and why it does it in the fashion in which it does it. Your Lordships will be await that over all reserved matters such as the economy, taxation, foreign affairs and

243
defence, to mention just a few, the United Kingdom Parliament at Westminster retains authority for all parts of the United Kingdom, including Scotland. Devolved matters such as education, health, transport and so on, as they effect Scotland, will be the responsibility of the Assembly and will be the subject of Assembly Bills. They will thus be outside the normal purview of Westminster because they will have been devolved. It follows that those same subjects, when they refer to England, Wales or Northern Ireland, will still be the responsibility of Westminster. This Amendment provides that where Bills do—and here I quote the words of the Amendment:
"not relate to or concern Scotland or any part of Scotland",
a certain course of action should apply. When such a Bill is read a third time in another place, and if it receives a majority in favour of it but it is determined that without the intervention of those Members of Parliament representing Scottish constituencies the Bill would not have received a majority in favour of it, then the Bill shall be deemed not to have had a Third Reading unless another place confirms its decision by a second vote taken at least 14 days after the original vote. I hasten to add that there is nothing magic about 14 days. What the Amendment does, therefore, is simply to delay the Third Reading by 14 days and I suggest that the reasons for this course of action are good.
If the Scots, by their Assembly, are to determine their own affairs, I venture to suggest it is right that the English, the Welsh and the Northern Irish should determine their own affairs; but it is not right that they should be superior to the United Kingdom Parliament. If, for instance, the Amendment had said that where on the Third Reading of a Bill which did not relate to or concern Scotland at all, there was a majority of English, Welsh and Northern Irish Members of Parliament against it, then that Bill should be deemed not to have had a Third Reading at all, that would be putting the English, Welsh and Northern Irish Members of Parliament in a superior position as regards both the Assembly and the United Kingdom Parliament; because although certain matters are
244
devolved to the Assembly, the United Kingdom Parliament has the right to override the Assembly. In the same way, the United Kingdom Parliament must have the right to overrule the views of the English, Welsh and Northern Irish Members of Parliament. This Amendment permits that.
Therefore, the effect of the Amendment is to provide that when a Bill which, for instance, may refer to education in England is read a third time and is voted upon, and if it is shown that although it may have a Parliamentary majority it would not have had that majority if the Scots Members of Parliament had not voted, and that the combined votes of the English, Welsh and Northern Irish Members of Parliament indicated that they did not want the Bill, then the Bill should have another vote 14 days later.
That delay of 14 days will he the effect of that vote. It will give time for people to think again; it will give time for the Whips to think again; it will give time for people to digest the effect of the Scots Members of Parliament. by their vote, imposing on England that which the English Members of Parliament, by their vote, have indicated that they do not want. It will give the Scottish Members of Parliament time to digest the impact both of their first vote and of their second vote which will follow. The second vote, 14 days later, will have all the force and authority of the United Kingdom Parliament. If in the second vote the Scottish Members of Parliament determine to vote in the same way and in a manner which imposes upon England that which the English Members of Parliament have indicated by their first vote that they do not want, then so be it. That is the just and right authority of the United Kingdom Members of Parliament acting with an equal vote as between one and the other.
In all the propositions which have been canvassed to get over this West Lothian question a host of difficulties has arisen. I do not seek to obscure those difficulties this evening but I venture to suggest that my Amendment meets most of them. It it agreed that you cannot have two classes of Members of Parliament, some who vote on some matters but not on others whilst some Members can vote on all of them. This is unacceptable to the principle that once elected a Member of Parliament

245
shares an equal common voice and vote on all matters with fellow Members, irrespective of the constituency he represents. This Amendment does not make two classes of Members of Parliament; all Members will have an equal voice and vote and no one is debarred from voting.
To those who would say that this Amendment ensures that the Scots vote does not count, I would reply that it does not have that effect. The Scots Members of Parliament have votes precisely the same way on the second occasion as they did on the first, and their vote will have the full Parliamentary force. I have been acutely conscious, as I hope your Lordships would expect, of the precious convention which prevents one House from interfering with the procedures of another House. Oddly enough, this Amendment does not do that. Whilst it would be quite wrong and impertinent for your Lordships to seek to dictate to another place the procedures that it should follow, I respectfully suggest that there is nothing improper in your Lordships suggesting to another place a possible scheme for getting over a very real difficulty—a difficulty which was constantly expressed in another place and which their rules of procedure prevented them from rectifying but which our rules of procedure permit us to do—and then inviting another place to consider such a scheme and, if they think fit, to approve it or improve it for incorporation into an Act of Parliament.
The Amendment does not of itself alter the procedure of another place. Even if your Lordships' House and another place agree to this Amendment that fact will not alter the procedures of another place. The alterations which subsection (1) of this Amendment propose will only come into effect if, after the Bill becomes an Act, another place determines that they should come into effect. They will determine that by approving a resolution under subsection' (2). This is subject to approval by another place, and by another place only. If another place rejects such a resolution, even if this Amendment becomes part of the Act, the provisions of the Amendment will not take effect. The proceedings of another place will therefore, as they should be, be entirely in the hands of and the responsibility of another place.
It may be asked by some, "Who determines, under subsection (3), what Bills do not relate to or concern Scotland?". Some may feel that the Speaker would be the obvious choice; others may think that it should be the Government, or possibly a committee. This Amendment deliberately seeks to avoid making a suggestion. That is a matter strictly for another place, and if another place seeks to amend this Amendment to indicate their preference, that is a matter for them. It might be suggested by some that if the Scots are to be denied involvement in English affairs under this Amendment why should the Welsh and Northern Irish Members of Parliament be still entitled to be involved? The answer is that at the moment all affairs of the United Kingdom, in the ultimate, are the responsibility of Parliament at Westminster, where each Member of Parliament has an equal vote to that of his fellow Members and carries his share of corporate responsibility. It is only Scotland, after the passage of this Bill, which is to have the privilege of an Assembly with legislative powers, and when this Bill becomes law it will be to the Assembly and no longer to Westminster that the people of Scotland will look for the solution of their domestic affairs. It is, therefore, only reasonable that the domestic affairs of the remainder of the United Kingdom, where they refer only to the remainder of the United Kingdom, should be determined by the Parliamentary representatives of the remainder of the United Kingdom, subject, of course, to the overriding authority of Parliament. This is what this Amendment achieves.
I do not claim that in a perfect world this is a perfect solution, but I do suggest that it is a genuine attempt to seek to alleviate a real problem, a problem which was constantly recognised in another place and which the Government must, in their heart of hearts, acknowledge even if they publicly and constantly refuse to admit it. If there is a fault, I venture to suggest that it is not with the Amendment that the fault lies but with the Bill. It is the Bill which has produced this inequity which everyone sees, which most people acknowledge but which up to now has remained unresolved. There are those who feel that if such an inequity is left unresolved the long term consequences can be very serious. This

247
Amendment seeks in the best way possible to find a solution to this problem. I venture to suggest that it is a satisfactory route out of a minefield of difficulties. Much better if the minefield were not there, and, if it were, that Parliament had not been placed in the middle of it. But it is there and we are in the middle of it. This is what the Government by this Bill have done.
I would suggest that it is better for us to get out of the difficulty by a carefully mapped route rather than to sit in the middle and wait for the fireworks to start up. I hope that the state of euphoria which, despite the Scotland Bill, must have surrounded the noble and learned Lord, Lord McCluskey, on his birthday yesterday will not yet have subsided and that on reflection he will see the wisdom of accepting this solution. I beg to move.
The Earl of PERTH: My Lords, before the noble Earl sits down, I wonder if I could ask one question. I think he said that Scotland alone would have legislative powers. Did not Northern Ireland until recently have legislative powers as well?
Earl FERRERS: My Lords, yes, but it has not now.
5.58 p.m.
Lord RAGLAN: My Lords, we have been over some of this ground before. Your Lordships will remember that the same problem arose in respect of Stormont. The solution that was operating for a long time I thought was an extremely unsatisfactory one; it was to reduce the number of representatives from Northern Ireland. The same solution, or a similar kind of solution, was proposed earlier in Committee in your Lordships' House and I spoke and voted against the reduction of the number of representatives from Scotland because I do not think that that is the right or relevant way of tackling the problem. I put my name to this Amendment although I do not think it has got it quite right. I think that it should include also Peers from Scotland, as their votes would continue to have influence on policy and legislation in England in respect of those matters which have been devolved to the Scottish Parliament. I am sure that noble Lords from Scotland would think that fair, and this
248
would allay some of the anxieties to which the noble Earl, Lord Ferrers, alluded earlier. The votes of Peers are not as important in their effect upon legislation as those of elected Members but I think that what is right in the Lower House should, where relevant, apply in the Upper House. If your Lordships accept this Amendment, perhaps the other place will make an appropriate adjustment to it.
I believe that, within the constraints of the system, the House of Commons did magnificent work on this Bill. But, despite the eloquent efforts of my honourable friend Mr. Tam Dalyell, after whom the problem is named, the anomaly which this Amendment seeks to correct somehow was not attended to. I am not an expert on the Constitution, or on the workings of the Scottish Office, though I have been learning a lot, and my noble and learned friend on the Front Bench will correct me if I have not got it quite right, but I believe the situation now to be that, although many things are devolved to the Scottish Office—and there are many more things than a lot of people realize—they are matters which can be squeezed in under the heading of Administration. However, when it comes to the making of policy, the United Kingdom is still treated as if it were a United Kingdom, and Members of the Westminster Parliament, wherever they come from, have a hand in the forming of policy. When policy is translated into law, the Members of the Westminster Parliament have the right to vote on that law.
There is, at present, a convention, which was alluded to by my noble friend Lord Hughes on Second Reading, that when the United Kingdom policy is translated into Scottish law, to take account of Scotland's different legal system and jargon, the Scottish law in its application does not differ in too great a respect from the English law; and, moreover, all Members of Parliament also have a right to vote on that Scottish law. As the noble Earl said, this Bill changes that. First, it changes the responsibility of representatives to Westminster from Scotland with respect to all devolved matters; and, secondly, it alters the right or competence of representatives from England to vote on, or probably even to discuss, matters devolved to the Assembly. One must pity

249
the Scottish Member of Parliament. He is to be kept out of things in Scotland, and is to be told to go away and play in England. In turn, Members from England are expected to welcome him, although they have no reciprocal rights on matters devolved to Scotland.
I believe that this will not work, even allowing for the, as I see it, mixture of paternalism and condescension with which London is wont to deal with a Scottish question. Furthermore, I do not see why it should he expected to work. It is obviously unfair and undemocratic, and if we are to pass this Bill it is best to recognise the position which it would create. We should deal with it realistically, without pretending that the anomaly is not there, and make provision as well as possible to meet the situation when it arrives, as it surely will. Some people do not think that this Amendment will do the job that it is intended to do. They would prefer the Amendment moved in Committee by the noble Earl, Lord Selkirk, which I also supported. However, I have been persuaded that this approach may provide a better way of dealing with a potentially explosive situation, and I hope that it commends itself to your Lordships.
Baroness BACON: My Lords, this is the first time that I have intervened during the passage of this Bill, and I must confess that I am not one of its most enthusiastic supporters. But I have taken the point of view that the Bill is with us and that we have to make it the best possible Bill, so that the Scots can have their referendum and decide what they want to do. I am not against some form of devolution for Scotland, but where I think we have made a mistake is in dealing with Scotland and Wales in isolation from the rest of the United Kingdom. I believe that it would have been much better if we had had some form of regionalisation for the whole of the United Kingdom. As a good Yorkshirewoman, I must say that in Yorkshire and Humberside—and the same is true of the North of England and of the conurbation of the North-West—they feel that they are equally important as Wales, and indeed as much entities as Wales, and there is something in that.
The effect of dealing with parts of the United Kingdom, and not the whole of the United Kingdom, is that we have the
250
anomaly which this Amendment seeks to rectify. It is that Scottish MPs will have no say in, for instance, what happens to education in Scotland, but they will have a say in what happens to education in Yorkshire. As I say, this Amendment seeks to remedy the position, but I believe that it is an inept and rather clumsy Amendment, and I do not think that it will do what the supporters think it will.
For instance, there are the 14 days which the noble Earl mentioned. So far as I can see, all this Amendment does is to say that there will be one vote on the Third Reading in another place, and a fortnight later there will be another vote on the Third Reading, the hope being, I suppose, that by some magic between those two dates the Members of Parliament who come from Scotland will have a change of heart, and decide that they will not exercise the right which they have by law to vote on that Bill. I have spent a long time in another place, and I must say that I have never found Scottish Members of Parliament as accommodating as that. So I do not see what this Amendment will do. I think that we shall have two votes, with a 14-day interval in between, and precisely the same people will vote for exactly the same thing.
There are two reasons why I feel that I cannot support this Amendment. One is that I think it is clumsy and inept and will make no difference; the other is the relationship between this House and another place. The noble Earl said that we are not telling another place what to do. There is a fine distinction here between what he said and this Amendment. I know that this Amendment states that there shall be a Resolution of the House of Commons before this comes into effect. But we are, in fact, suggesting to another place that they should take this line.
My noble friend Lord Raglan mentioned this House, and I feel that it ill becomes us to suggest what another place should do about voting in their House, when we are doing nothing about those Members of this House who happen to come from Scotland. We are apparently going to leave every Scottish Member of this House to vote on everything in England, while suggesting to another place that the Scottish Members there should not vote on those matters which are solely concerned with England.

251
Let me repeat that I have a good deal of sympathy with what is at the back of this Amendment, because I feel that there is an anomaly here. But I cannot agree to vote for this Amendment because I do not believe that it at all deals with the anomaly. I think that it will be unsuccessful, and when we are not prepared to take any steps about your Lordships' House, I do not believe that we should be telling another place what to do.
6.9 p.m.
Lord HOUGHTON of SOWERBY: My Lords, I shall support this Amendment. I believe that it is the least objectionable remedy for an almost insoluble problem. I think that the only alternative to this Amendment would be to leave it to the good sense of Scottish Members of another place to decide their own course of action, having regard to all the circumstances of the matter, and it may be that it will come to that in the end.
This is not a new problem. It was discussed in connection with the Irish Home Rule Bills towards the end of the last century. I was at the Round Table Conference over 20 years ago on the future constitution of Malta. There we discussed the matter at great length and proposed the integration, believe it or not, of Malta with Britain and the representation at Westminster of Malta on conditions similar to those which obtained for Northern Ireland. We found no solution then to the problem. Of course, we have had the full participation in the other place of the Members for Northern Ireland in all matters relating to the Westminster Parliament.
Probably the difference between the past and this Bill is the size of the representation from Scotland compared with the size of representation from other parts of the United Kingdom where similar conditions would apply. When I sat on the Royal Commission on the Constitution, I supported the retention by Scotland of its disproportionately favourable representation at Westminster, on the ground that Scotland was a minority part of the United Kingdom and, because of her minority position, was entitled to have rather more than average representation at Westminster. It is not easy
252
to argue that logically, perhaps, but it seemed to me to be undesirable to attempt to cut down the representation of Scotland at Westminster as part of the arrangement for devolution to an Assembly in Scotland. Therefore, I was in favour of Scotland retaining its present favourable representation at Westminster. If Scotland is to retain its present favourable representation at Westminster, what Scottish Members of Parliament do at Westminster becomes even more important, because they will be using disproportionate Parliamentary strength on matters which may relate exclusively to England.
My noble friend Lady Bacon has just spoken, and I was very interested in what she had to say. So far as this House is concerned, some of us are hoping that it will be reformed, while others are perhaps fearing that it may be abolished. Perhaps it would be wise to proceed on the assumption that this House will not remain composed as it is indefinitely, and that when that time comes there will be an opportunity to deal with the matter in relation to this House. However, I do not believe that to leave the matter as it is will for very long be either satisfactory or tolerable to the people of England.
One of the advantages of this Amendment is that if the House of Commons so determines, it may draw attention to the fact that a particular Bill was given its Third Reading by the weight of Scottish Members of Parliament which it would not otherwise have had. There is perhaps some virtue in drawing particular attention to a situation and giving another place a reasonable period in which to reconsider the action already taken; otherwise the fact that a Bill may be passed by the House of Commons because of the weight of the votes cast by Scottish Members of Parliament may go unnoticed—unless there is a row about it, unless there is some objection by the people of England to the determination of the law of England by the weight of Scottish representation at Westminster.
I think that it would be damaging indeed if there were no remedy in our Parliamentary system for the cry that would go up that Parliament was unrepresentative when deciding matters affecting England and, therefore, that respect for Parliamentary decisions was not justified. There are already sufficient challenges to the

253
unrepresentativeness of Parliament as it is, and I think that it would be a mistake to add to the indictment against Parliament that it fails to be representative of public opinion.
There are matters of acute controversy upon which feelings go very deep indeed and upon which the weight of Scottish representation might determine the law of England. The action of the Scottish Members of Parliament in such circumstances may be designed to stop something happening in England which they do not want to happen in Scotland. One can speculate upon the motives which may govern the action of Scottish Members of Parliament at Westminster in deciding, as they would, to vote one way or another on matters affecting England. These are serious difficulties. The dismemberment of the body politic is a messy business, and there is no getting away from it. All of the matters relating to what is to be devolved, wholly or partially, and to the retention of the supremacy of the Westminster Parliament are complicated and provide difficulties.
Of course, the essential difference between what we are doing in this Bill and other federal Constitutions is that federal Constitutions have mostly come about by the yielding up of power to the centre—not the other way round. That is certainly the case in the United States. It is certainly the cast in Canada that the decision was taken to yield up to the centre those powers which it seemed to be desirable and even necessary to exercise on behalf of the federation or the federal body as a whole. We, on the other hand, are devolving from the centre, and our situation is completely different, both historically and constitutionally.
Constitutionally, all power in this country is vested in the Crown. It is from the Crown that all power devolves. The history of Parliament was the struggle to wrest power from the hands of the Crown and to establish the right of Parliament to advise the Crown in a constitutional and at the same time democratic way. Therefore, we are constantly devolving power. Whether it is the Royal Prerogative or anything else, all power is devolved from the centre to the periphery. This is bound to give rise to an extremely difficult problem of amputation and to these many difficulties. Quite understandably, central
254
power desires to retain a fairly high degree of central control, and that is quite different from the yielding up of power from the periphery.
I see no other way of dealing with this problem in a way which would be satisfactory or acceptable to Parliament, and that is why this is the best that can be made, so far as I can tell, of this difficult problem. As the noble Earl pointed out in moving so ably this Amendment, this Amendment does no more, however much more we should like to do, than say to another place, Pause. Look at what you have done. This matter may evoke strong objection from the people of England, and we do not want to recreate antagonism between England and Scotland by the thoughtless action of Scottish Members of Parliament at Westminster". So this Amendment says, "Pause; think again. Decide whether you wish to pass the Bill in this way, even though it is not acceptable to the people of England and, in some cases, the people of England and Wales".
Therefore, I support the Amendment, because I have nothing to put in its place. There has been much correspondence, I may say, between various interests in this country and the Lord President of the Council—I have a bundle of it in my hand at present—in an endeavour to resolve problems, admittedly of an acute and controversial nature, having regard to the overriding power which, in certain circumstances, Scottish Members of Parliament might exercise. I find no other way. Therefore I support the Amendment.
6.20 p.m.
Lord SHINWELL: My Lords, my name was included on the original Amendment that has been modified, but it has now been excluded, about which I make no complaint whatever. Indeed, there is an advantage: the Amendment might be carried and the Government defeated, and if I were included as one of the sponsors that would not be to my advantage; therefore it is just as well that I am not one of the sponsors. However, if at the end of the debate there is a Division I shall vote for the Amendment—not that the Amendment is really any good. Neither was the original one because in point of fact we are on the horns of a dilemma and undoubtedly we are already impaled on both.

255
Various solutions to this intricate and difficult problem have been suggested. One of my noble friends, Lady Bacon, said "Do not deal with it at all. Leave it to the other people. It is not our business". That is not a solution to the problem; that is passing the buck. So we need not say any more about that.
Baroness BACON: My Lords, I did not say that.
Lord SHINWELL: My Lords, the other possible solution is the one suggested by my noble friend Lord Houghton of Sowerby, who said that he supports the Amendment because we should leave it to the Scots to fight it out when it goes to the House of Commons. That is precisely the problem; that is what it is all about.
We had better start at the beginning. That is always the right place to start. What is the proposition contained in the Bill? It is a simple one: there is to be an Assembly. That is an assumption which we all hope will he fulfilled, although we are somewhat doubtful about their functions when the creation occurs. After a period of between six months and 12 months that Assembly will have to face up to a proposed Speaker's Conference, decided upon by the Prime Minister of the day. That is not a political allusion, by the way. I just say "of the day" in passing. One never can tell who is likely to have to face the problem. So there will be an attempt to promote a Speaker's Conference, and a number of Members will be appointed by the Speaker, perhaps after consultation with the Prime Minister, as Members of that Speaker's Conference. There will be a reasonable balance of Members representing all Parties, but one section of course will be excluded—the people who are perhaps more interested than any others, the Members who are elected to the Scottish Assembly. They will be completely excluded because that is in the Bill. It comes in, in an ambiguous and equivocal kind of way in the Amendment, but we will come to that later if there is time.
Meanwhile the Scottish Members appointed in Scotland to attend the Assembly will be excluded. It is important to take note of that because they are intensely interested in the work in competition against the proposed Scottish
256
Members elected to go to Westminster. Whether we like it or not—and we can argue about it until we are blue in the face, and so can the other place—the fact that those Members who are elected (and numbers do not matter very much; it might be 60, 63, or 71, which is the present number), simply because they have been elected by their Scottish constituents, will be intensely interested in Scottish affairs. How can one prevent it? It is quite impossible. Those who are elected to the Assembly will be there also, both sections dealing with Scottish affairs, whether they are devolved or reserved—in the case of the Scottish Assembly Members, dealing with devolved questions, the others dealing with reserved questions.
If a person represents a particular constituency when elected to go to Westminster, can that person ignore the demands of his constituents, the letters he receives from day to day, the questions he will be asked and the demands that will be nude upon him? It would be nonsense to expect that. There will be intense rivalry and, obviously, to exclude the Members who are elected to go to the Scottish Assembly from engaging in consultation and discussion with both the English Members and the Scottish Members elected to Westminster would simply mean a great deal of trouble.
The purpose of the Amendment is to deal with Scottish Members elected to go to Westminster not voting. Why should they refuse to vote? Because there may be a proposition coming all the way from Scotland and suggested by the Members who are elected to the Scottish Assembly that, instead of the 71 Members, there should be only 50, or perhaps 40, and no more than are elected to go to the Scottish Assembly. That is why there will be trouble in another place, because those who want the same representation, say 71, will continually demand it and it must not be forgotten that they will already have been elected as Members. If there is no other election before then they will still be Members from Scottish constituencies. That is what is called the West Lothian question. By the way, I have some qualifications for talking about this matter because many long years ago I was myself a Member of the West Lothian.

257
What is the solution? The plain fact of the matter is that there is not any solution, so why do we not face it? There is no solution in the Government's proposition because that will cause the trouble. There is no solution in the Amendment, and indeed the noble Earl, Lord Ferrers, recognised that. He made a most elegant speech but he himself created more problems. My noble friend Lord Houghton of Sowerby created more problems, too, and my noble friend Lady Bacon created some problems. My noble friend Lord Raglan did not speak for very long so he avoided creating problems.
Why should we support the Amendment? I will tell your Lordships why. You may regard me as sinister, almost mischievous, Machiavellian. Call me what you like; I can provide you with any number of adjectives. Support the Amendment and—I use the term that was suggested by the noble Baroness, Lady Bacon—pass the buck. Pass it back to them; let them fight it out. The Bill is a had Bill; it was a bad Bill from the start, full of complications. I think that even my noble and learned friend the Solicitor-General for Scotland will agree to that. It was full of complications. Look at the vast number of Amendments that have been tabled. Of course, the other place disposed of the Amendments by imposing the guillotine. We did not do that.
Here we have a proliferation of Amendments creating more problems. The fact of the matter is that there can be no solution of the problem as long as there are two sets of Scottish Members. I happen to know Scotland, and I know the kind of jealousies, animosities, hostilities, quarrels and envious activities that will emerge as a result of having the two sets. For example, if you have in a particular constituency one Member elected to the Scottish Assembly in Edinburgh and the other, elected by a similar constituency, going to Westminster, what do you think is going to happen when they meet? Are they not going to argue about it? Are they not going to confront each other with different ideas and different concepts as to what should happen either at Westminster or Edinburgh? Of course they are. That is the trouble about this Bill.
My Lords, when we had our Second Reading I ventured to say—and I hope
258
your Lordships will forgive me for repeating myself—that, of course, there should be some measure of devolution. There was a demand made for that when I myself was elected for the first time, indeed before I was elected. In 1918 it was in our Election Addresses: Scottish Home Rule—nothing to do with separation, nothing to do with independence; it was about employment and impoverishment and slums and not getting enough money from Westminster. That is what it was all about. There was no Marxism in it either, nothing of that sort. I ventured to say, in the course of the Second Reading, that of course some measure of autonomy is essential; but it depends on the content, on the form of it, on the attitude of mind. This is what is required. We are not going to have it.
So I suggest we pass the Amendment for the sole purpose of sending it back to the House of Commons. That is what we should do. They never discussed the matter adequately. Give them an opportunity of doing it. I wish I could say otherwise but I cannot, despite all the eloquence we have heard from my noble friends, my notable colleagues, and there will be a great deal more of it. At the end of the day neither shall we discover in the Government's proposition a solution. I do not regard that as a complaint against them. It so happens that they could not find a solution; they created a proposition instead of finding a solution. It was a natural course of events. If that is the situation, surely the best course of action is to pass it back and say, "There is an Amendment; make the best of it or the worst of it", and see what happens.
6.43 p.m.
Lord DUNCAN-SANDYS: My Lords, I do not propose to take up all the stimulating points raised by the noble Lord, Lord Shinwell. All I wish to do is very briefly to express my wholehearted support for the Amendment which is before us. I was in fact one of the sponsors of an earlier Amendment which was put forward by my noble friend Lord Selkirk and which was withdrawn. I regard this Amendment as a second best, but nonetheless I whole-heartedly support this Amendment.
It would, I think, be a constitutional nonsense for the people of Scotland to be given the right to take decisions on their

259
own in respect of Scotland while retaining the right to exercise possibly a decisive vote on similar matters affecting only England. It would not only be an absurdity; it would be a totally indefensible injustice. As I have said, I should have preferred the much simpler Amendment proposed by my noble friend, which would have provided that Scottish Members of another place should not be entitled to vote on matters which have been devolved to Scotland, but, as explained by the noble Lord, Lord Houghton of Sowerby, this Amendment would, when the situation occurs, clearly draw the attention of this House to the fact that a Bill sent to us from another place affecting only England did not command the support of a majority of the representatives of English constituencies. I will not go so far as to say that in all such cases your Lordships' House should feel that it had a constitutional duty to protect the people of England against unwarranted interference from across the Border, but this Amendment would undoubtedly make this House feel much freer than usual to reject such a Bill if it wished to do so; and for that reason I wholeheartedly support this Amendment.
Lord GLENKINGLAS: My Lords, I think perhaps it might be a good thing for one Scotsman, at least, to speak on this. I should like to say to my noble friend that I entirely support his Amendment but, like the noble Lord, Lord Shinwell, I do not believe for a moment it will work. All the experience I have had of the other place tells me that it does not really matter whether you wait two weeks, three weeks or two months. If the Chief Whip says to his Members, "You will vote", there are jolly few of them who will change their mind. I have at least some experience of it. But I agree that this is morally right. I think it is a good thing that we should pass an Amendment of this sort, making it quite clear that not only the English but also the Scottish Members of the House of Lords would feel embarrassed at having an advantage, which would be quite clear, over the English Members in another place.
The Earl of PERTH: My Lords, the more I listen to the debate this evening the more I am clear that the only proper solution of this problem is the federal solution. All of these problems of unfairness or difficulties of one kind or
260
another would disappear if we had a federal solution. It might almost be said that if these anomalies and unfairnesses and difficulties remain, it might ultimately accelerate the move to a federal solution, which I believe is the right one. To that extent I am not entirely sure that the very ingenious proposal put forward by the noble Earl, Lord Ferrers, should go through—and it is a very ingenious solution.
It also creates many difficulties. I do not know whether anybody has given thought to how often this particular method of delay might occur in Bills in the other place. Would it be once a month, once a week? The whole legislative programme could be very seriously affected, and it might be a very tiresome thing for anybody who is trying to run the business in another place. However, perhaps that is for them to think about. But it is not necessarily something which will make for easier work. We all know how short of legislative time the other place is.
The noble Lord, Lord Houghton of Sowerby, recalled the days when he was on the round table conference for Malta. I was with him, and we debated this at great length, We decided that we could not make Maltese Members of Parliament any different from any other, and that, I think, on the whole was probably a question of size. I wonder where does size bite? What happens if, as I hope and we all probably hope, in a short while Northern Ireland is given back Stormont and its own legislative powers. Would we propose at that time that the M.P.s of Northern Ireland should be in the same position as Scots ones? The other place is going to become rather a funny place, with various Members being able to vote but having all sorts of pressures put on them not to exercise their votes under certain conditions.
I think that we should consider for a moment what that means. It is potentially a recipe for ill-feeling between England and Scotland. I know the risk the other way round, but I assume that its aim would be to put pressure on the Scottish MPs not to do what they consider is their duty. If I know anything of my fellow Scots, the more the pressure the more they will be obstinate and stick to what they think is right. Therefore,

261
much as I find it by far the best solution that we have had to deal with the West Lothian problem, I feel, along with the noble Lord, Lord Shinwell, that it is not really any good; and if it does not do any good then we should not go for the Amendment.
Lord WEDDERBURN of CHARLTON: My Lords, I should like to follow the noble Earl, Lord Perth. I have many objections to the Amendment but I shall address myself to only one. In my submission the insoluble problems that have been described are not solved by the Amendment even within its own logic. It is ingenious, but it is not good enough. Legislation is only as strong as its weakest link. In this clause the weak link is surely the definition issue—that is to say, who is to decide, and how, whether a Bill relates or concerns Scotland or any part of Scotland.
The noble Earl who moved the Amendment dealt with that matter in a particular way. Of course, it is a phrase which is so replete with the possibilities of ambiguity and lawyers' argument that it would make the antennae of any good clerk of a barrister quiver in anticipation of the fees to be earned. However, as I understood the noble Earl, it is not in his view to be a justiciable issue before any court. The definition issue is not to go to a court. I shall pause for a moment on that point. I understand why that is so. To make it a justiciable issue before a court would, indeed, make the powers and procedures of the other place subject to judicial decision in a wholly novel way which would, indeed, invade its privilege.
Of course, the consequence for the noble Earl that the matter is not to be justiciable is that the symmetry of his argument is upset. A devolution isssue, in many instances at least, will be decided by the Judicial Committee of the Privy Council in regard to Assembly Bills. The definition issue under this Amendment, or this clause as the noble Earl would have it, would not be dealt with by a court, for very good reason. By whom, then, would it be decided? As I understood him, the noble Earl suggested that the definition issue would be for the other place to deal with. He made three suggestions; namely, that it might be decided by the Speaker; that it might be
262
decided through a Committee; or that it might be for the Government to decide.
There are, of course, many other possibilities of machinery that the other place might wish to adapt to the problem of the definition issue. However, whichever machinery the other place devise the matter could always be one which ultimately came to the Floor of the other place. There could be a challenge to a decision of a Committee; the Government's view could be challenged, and as I apprehend it, even a decision of the Speaker could be challenged on the Floor. In that case the noble Earl faces the following problem: are Scottish Members to have a vote on the definition issue? If they are not, what procedure is to be devised? If he has a special procedure for that, who is to decide when to use it and are Scottish Members to have a vote on that? In my submission the noble Earl is in a position of infinite regression and the sands shift below him because he has not given us the missing link in the clause.
Moreover, because there is a missing link, in my submission the Amendment could cause very bad feeling in the other place. In fact, the noble Lord, Lord Houghton of Sowerby, suggested that in the end it will all depend on the good sense of Scottish Members; and because there is no answer to the definition issue in this Amendment the matter will depend on the good sense of Scottish Members in deciding whether it relates to or concerns any part of Scotland. So if that is the end of the road, why not leave it to the good sense of Scottish Members in the other place, without the Amendment?
Lord BANKS: My Lords, I should like to make a brief comment and in doing so say that I agree wholeheartedly with what was said by the noble Baroness, Lady Bacon, who regretted the fact that we were not attempting to deal with the problem for the United Kingdom as a whole, that we were not producing a scheme of devolution which would cover the United Kingdom as a whole, but that we were, in fact, trying to deal with Scotland and Wales on their own, leaving or causing this problem which we are discussing this afternoon.
I certainly see a problem, but, as the noble Earl, Lord Perth, has said, the solution lies in a devolution scheme or a

263
federal system for the whole of the United Kingdom, and we delude ourselves if we suppose that we can solve the problem along the lines of this Amendment. The problem will be most acute when there is a Government in power which depends on a majority of Scottish Members in order to get their own majority. When in such a situation, it is, in my view, rather far-fetched to suppose that having another vote a fortnight later will make any difference to the way in which Members vote.
The noble Lord, Lord Shinwell, spoke about the pressures which are on Members, the pressures to support their own particular political point of view and the pressure of those who sent them to Parliament to do so. It is difficult to see them changing their point of view within 14 days. Therefore this procedure would not, in my view, make any difference at all, but it might delude us at this time into thinking that we had solved the problem when in fact we had not. It is much better to face the fact that as yet we have not had before us a solution and perhaps we should look along the lines of an extension of devolution for the whole of the United Kingdom as the way in which the problem can eventually be solved.
6.47 p.m.
Lord SEFTON of GARSTON: My Lords, I feel that as a new Member of the House of Lords I may well step outside the boundaries within which I should confine myself when discussing this Amendment. If I do so, I hope that your Lordships will forgive me. I did not prepare a speech as I did not originally intend to speak. However, I have been rather encouraged to speak by remarks that have been made in the debate, one of which concerned real power and the other that the movers of the Amendment seem to believe that there is credibility in the idea that domestic matters can, in fact, be discussed and resolved properly on the basis of devolution to Scotland, Wales or England. I wish to dispute that completely.
I do not believe that it is possible in a tight island such as ours to divide Government into areas based upon land boundaries. First, I believe that we should pose the question to those who want
264
devolution for Wales or Scotland: where is Wales; where is Scotland; where does Wales begin and England finish? I should like to give an example to demonstrate what I think are the weaknesses of the whole devolution Bill to which I am utterly opposed. One could say that the strategic land use plan for an area such as Merseyside would be a domestic matter. However, is anyone in this House or elsewhere prepared to say that the domestic problems of planning a region like Merseyside could be solved without taking into consideration the whole of North Wales, of which Merseyside is a part? It is quite evident that one could not plan the transportation system, the hospital system, the water system or any other economic organisation that is spread over boundaries in that part of the world without some very close cooperation between the people who live in Wales and the people who live on Merseyside.
I believe that this Amendment enshrines that idea. While my heart is with it, my reason tells me that it should be turned down. If once we subscribe to the point of view that devolution is the answer to the discontent that has been felt in the United Kingdom long before Plaid Cymru or the Scottish National Party ever came into existence, we are sadly mistaken. The discontent that was felt inside local government circles in the United Kingdom has been felt for over half a century, and there is a great need for the decentralisation of the power-making machines in this country.
While the other place and this Chamber continue to debate the question as to whether or not we are devolving power to people in the localities, all the while real power, which was referred to by a noble Lord, is slipping out of the hands of the democratically-elected bodies of this country. It slips out because someone has proposed the idea that real economic power can be devolved to people on the basis of land boundaries that do not represent the economic region over which the elected representatives are supposed to have some control. Even the debate on Wales led to a situation where a serious report was produced which showed that because of the inability of a Welsh Assembly to control the electricity industry, what would be required was the removal of the autonomy of the already appointed

265
regional boards which should be placed in the hands of a central electricity council. Will that central electricity council be responsible to an elected body or will it—as we all know—be responsible for perhaps one day's debate in the House of Commons during a year, and responsible to a Secretary of State?
Is that the devolution of real power? The noble Lord said that real power rested in the Parliamentary institutions and the Monarchy of this country. It may, by tradition. But real power rests in the hands of those who administer our economy, whether they are the State boards or private companies; that is where the power will be determined and that is the power that will decide the standard of living of our people. It is in that field that any devolution of power should be concentrated.
Lord KINNAIRD: My Lords, may I interrupt the noble Lord?
Several noble Lords: No!
Lord SEFTON of GARSTON: My Lords, I was about to conclude with this point, and I am sorry if I have offended any noble Lords. The North West Economic Planning Council, of which I am proud to be the chairman, took a decision that it would be opposed to the devolution proposals because it would lead to the disintegration of the United Kingdom. It did that because once we step along the slippery path of saying to a certain land area of the United Kingdom that there is a solution to its problems in devolution, that area will begin to believe it and will absorb the idea that if at the first attempt of devolution its discontent is not satisfied and it does not appear to have obtained the power that it requires—and it will not—the demand will not be to go back, but will be for more devolution. That is the path which the United Kingdom has, in fact, set itself to tread with the devolution power.
A previous noble Lord who spoke said that there is no real solution. There is a real solution; it is that we should forget the boundaries that are thrown up by some people to divide us and that we should all go into the referendum in order to ensure that the Scotland Bill is thrown
266
out lock, stock and barrel; we should not try to amend a Bill that is a positively bad Bill.
Lord HOME of the HIRSEL: My Lords, the House will be filled with admiration for the noble Lord, Lord Sefton of Garston, who has chosen to make his maiden speech in the middle of this very complex and difficult Scottish Bill. We listened with great interest to what he had to say and shall look forward to other contributions from him at other times. I congratulate the noble Lord on his maiden speech.
As my noble friend indicated when he introduced this new clause, the language of it is tortuous. I am bound to say that I should find it extremely difficult to vote for it were it not for the fact that no one has been able to devise anything better or anything simpler. If this Amendment goes to another place, that may come in time, but nothing simpler or better has yet emerged.
However, I return again and again to the speech of the noble Lord, Lord Houghton of Sowerby. Unless some Amendment of this kind goes into the Bill, friction between England and Scotland is a certainty, and it will happen very often. Therefore, I think that there is an obligation on this House to put something into the Bill which another place can consider and amend if it likes; but something ought to go into the Bill, either from this House or from another place.
Therefore, although I think that the Amendment is open to some of the doubts expressed by the noble Earl, Lord Perth, it would be very serious indeed if nothing were put into the Bill. It would simply be a recipe for continual friction between England and Scotland. Accordingly, I support the Amendment moved by my noble friend.
Lord WIGG: My Lords, before the noble Lord sits down, will he be good enough to address himself to this point? Earlier on in the debates on the Bill some of us made an attempt to face this problem and to do so in terms which were clearly recognisable; that is to say, to reduce the actual number of Scottish Members of Parliament in another place. As my noble friend Lord Houghton of Sowerby said, that was a signal to another place that

267
once we start tinkering around with authority, the question of the representation of Scotland at Westminster is bound ultimately to arise—it will arise sooner or later.
It seems to me that the noble Lord, Lord Home, is rather less than fair in saying that this is the only alternative. It may be that it is an alternative that does not draw blood, but our attempt at an earlier stage was to do the same thing. I wonder whether the noble Lord will be kind enough to say why he rejects that concept.
Lord HOME of the HIRSEL: My Lords, I do not think that I should because this is the Report stage. However, the noble Lord has asked me a question so perhaps I may reply. I thought that his earlier Amendment modified the West Lothian difficulty, but did not remove it.
Lord MORRIS of BORTH-Y-GEST: My Lords, may I in a sentence or two, and I hope with the utmost brevity, state why I have very considerable misgivings about this Amendment. Ever since I had the honour of becoming a Member of your Lordships' House—and I can assure your Lordships that I do regard it as an honour—I have always felt that if an Amendment was proposed, I ought to consider—and I speak only for myself—whether I think the Amendment will improve the Bill and whether it is right for the Amendment to go into the Bill. I cannot believe that it would be right for this Amendment to become a part of the Act.
I thought that the noble Lord, Lord Houghton of Sowerby, whose speeches I always much enjoy—they are always so persuasive—was really saying, "Well, pass this Amendment and you pass the matter to another place and you will be able to tell them that there is a problem called the West Lothian problem". Do we really need to pass an Amendment and send it to another place in order to inform that other place that there is a problem—and, of course, there is a problem—to which they ought to direct their attention? Surely they can take the matter up without the spur of the passing of this Amendment.
I respectfully believe that we ought not to pass the Amendment unless we think
268
it is right. I, myself, am reluctant to appear to be interfering in the affairs of another House. But apart from all those other matters I find my views coinciding very largely with those expressed by the noble Baroness, Lady Bacon. What does this Amendment propose? It proposes that a Bill passed by the votes of Scottish Members should be deemed not to have been passed, but some days later they can all vote again and the Bill will be passed. If it is wrong for the Bill to be passed with the voting of some Scottish Members, surely it is wrong at the end of 10 days just as it was at the start. I recognise that there are points here to be considered but, with the best will in the world, I cannot think that it would be helpful to pass this Amendment.
7.1 p.m.
Lord ELLENBOROUGH: My Lords, I should like to support this Amendment because I am sure that it will bring home to another place and to the electorate as a whole the hopelessly difficult, if not ludicrous, problem arising from what has become known as the West Lothian anomaly which is highlighted by this Amendment. Many noble Lords, including myself, feel that an appropriate reduction in Scottish representation at Westminster is inevitable—if, and when, an Assembly is set up—bringing Scotland into line with the rest of the United Kingdom. That may be the best way, but certainly I think that this Amendment will help.
There was an article in The Scotsman only last week entitled "Let us be fair", which makes it quite clear that Scotsmen generally, as one would expect, wish only for fair play and expect only fair and equal representation. Many Scots are fearful of independence and are only too aware that if devolution is to have a chance of succeeding it must be fair or it will fail. Of course one can pick holes in this Amendment. That is not the fault of the movers of the Amendment; it is the fault of this Government for producing this unworkable Bill. In the last resort it may be that the only solution is either to drop devolution or to have independence for Scotland. Then the West Lothian anomaly will go away.
There may be some sort of convention that can be established whereby Scottish Members of Parliament will absent

269
themselves on Third Reading, if not the first time, as it were, at any rate on the replay, after 14 days, or whatever period is thought to be appropriate. There must be some doubt about it, particularly in these days of three line whips and tight majorities of one or two, but the moral pressure will I be there. After all, one cannot forget that the present Government, when they had a majority of only one, or even were in a minority of one, railroaded highly controversial legislation through Parliament despite the fact that they had only received some 30 per cent. of the votes of the electorate, and some 40 per cent. of the votes actually cast.
The crunch question will be, "Will the Celtic troops hold back". Some have even visualised the ridiculous spectacle of Mrs. Thatcher occupying the Treasury Bench on Mondays and Wednesdays, and Mr. Callaghan on Tuesdays and Thursdays. One thing is clear, and that is that if unpalatable legislation is going to be thrust down the unwilling throats of the English because of the votes of Scottish Members of Parliament, who will have their own Assembly, it will be a recipe for disaster and there will be an English backlash.
It really is no good some saying that because Scotland and Wales, who usually return a majority of Labour Members of Parliament, and still have to lump it—or "thole", it, as was said in a previous debate: a good Scottish word, so I am told—during periods of Conservative Government, England must lump it when there is a Labour Government because of Scottish and Welsh Members of Parliament pushing through controversial legislation contrary to the wishes of England, which may have a majority of Conservative Members of Parliament, and at a time when such matters are devolved to Scotland and Wales. The point is that Wales has only 5 per cent. of the electorate and Scotland only 9 per cent. of the electorate, and they must therefore expect to some extent to fall into line with the opinions and wishes of the predominant members of the United Kingdom that is to say, England, which has some 83 per cent. of the total electorate.
Lord HARMAR-NICHOLLS: My Lords, there is one comment on a point made by the noble Lord that I think ought to be on the record. He was perhaps being too much of a purist on this. All this
270
Amendment can do is to keep the matter open. The other place cannot give any thought to it in the sort of detail that they ought to unless we give them the hook on which to hang their debate. The noble Lord, as a purist, may well have seen some difficulty in approving words he did not think ought in the end to appear in an Act, but the only way we can get further thought given to the matter is to send the Amendment to another place so that they can have further thoughts on it. This is all the Amendment does.
The noble Earl, Lord Perth, described my noble friend's Amendment as an ingenious solution. Of course, it is not a solution at all. All that it does is to keep the matter open for further thought to be given to it. Anyone who understands the procedures in another place, or indeed in your Lordships' House, knows that very few people, if any, will change their minds in a fortnight. But if this Amendment is passed it will give the ultimate power to your Lordships' House to give an even longer period of thought for a change of mind to come about.
The importance of passing this Amendment, even though one may not agree with the words or the effect it will have if it appears in the Act, is to keep the matter open in order for second thoughts to be given to it. The only way that we can do that is to send it back along the corridor with words that will allow the other place to go into it in the sort of detail the subject warrants.
Lord HYLTON: My Lords, I am conscious of the impending dinner hour, and I shall be brief. It is an interesting Amendment if only for the considerable interest it has drawn from the Government Back-Benches, who seem so far to be in favour of it by about two to one. I feel that the Government have drawn this Amendment on to their own head. They have so far steadfastly refused to admit that if you bring in a form of devolution such as the one we are considering, you are bound to affect the balance of the rest of what is an unwritten Constitution.
The Government have further resisted any limitation on the present number of Scottish Members of Parliament in Westminster, and they have not favoured in any way the suggestion that has been made at least twice that there ought to be a

271
constitutional convention limiting the ability, and the right, of Scottish Members of Parliament to vote on purely English matters. I would only ask my noble friend who moved the Amendment, whether it would not be better that his proposal should bite at Second Reading rather than at Third Reading. Apart from that, I entirely support his Amendment.
7.8 p.m.
Lord McCLUSKEY: My Lords, this debate has lasted for the best part of an hour and a half, and I trust that the House will grant me a few minutes to seek to reply to it. May I begin by joining the noble Lord, Lord Home of the Hirsel, in congratulating my noble friend Lord Sefton on his maiden speech. I may say that it has been my experience on a previous occasion here to stand up with the somewhat difficult task of congratulating one of my noble friends for making a maiden speech attacking a Bill that I was seeking to defend, but at least, although his heart does not seem to be in the right place so far as devolution is concerned, he will apparently end up in the right Lobby, and that at least welcome.
I should like also to congratulate the noble Earl on producing this extraordinary new clause. I say that because the problem has existed since devolution first began to enter the currency of political discussion. I refer particularly of course to 1973 when the report of the Commission sitting under the noble and learned Lord, Lord Kilbrandon, identified the so-called West Lothian question very clearly, and the problem then began to be discussed. I should he interested to hear, when the noble Earl replies, when it was that he and his noble friends, and indeed his right honourable and honourable friends in another place, thought up this extraordinary solution which no one commends and everyone condemns but which I understand all will nonetheless support through the Lobbies.
It was said not to be a perfect solution; that was the understatement of the debate. The noble Earl said the House of Commons could amend it, and I emphasise that remark of his. He does not say this is the final form of the thing but that the House of Commons can amend it. Would
272
he kindly tell us in his reply what Amendment he has discussed with the right honourable gentleman Mr. Pym or with his honourable friends, otherwise we do not know what we are voting for? We should be told what it is that the official Opposition hope to move into the Bill in the Commons. He says this is not the solution, that it is not perfect and that they can amend it. Would he kindly tell us what ultimately we shall get? This is a pig well concealed in a poke.
We have also been subjected to some extraordinary logic from one Peer after another. My noble friend Lord Shinwell, who always lends a great deal of humour to the debate, said, "The Amendment is not very good, so I will vote for it" The noble Lord, Lord Glenkinglas, who I think spoke for many, said, "I do not believe it will work, but we should vote for it". In my view, the most responsible question asked in this debate was put from the Cross-Benches by the noble and learned Lord, Lord Morris of Borth-y-Gest, when he said: "I ask myself one question: Will it improve the Bill?"
Nobody who supports the Amendment supports it on the ground that it will improve the Bill. It is apologised for because it is a kind of interference once removed with the procedures of another place. It is said not to be a perfect solution, and somebody else will magically transform it, but who says that it improves the Bill? I have heard nobody say it will do that, and this House must think very carefully indeed before it seeks to move into the Bill a clause of this kind which no one says will improve the measure. If the question posed by Lord Morris of Borth-y-Gest cannot be answered responsibly, then those who cannot answer it in the correct way should not support the Amendment in the Lobby.
The noble Earl, Lord Ferrers, said, rightly, and I agreed with him, that it is for the other place to determine its own procedures. There is nothing to stop the other place from determining a matter of this kind in a way that is suitable for them, and I believe it is important that it should be left to the other place. What is worrying about this is the point I need not labour because it was made so clearly by my noble friend Lord Wedderburn; we are, after all, talking about legislation, about something that is to go on the

273
Statute Book, and when one looks at the extraordinarily woolly wording of the Amendment—the use of the word "concerns" in this context—there is here a problem of definition. I do not know how it will be resolved, indeed we do not know who will resolve it, and again the noble Earl will not tell us that. Will he tell us that when he replies?
Many noble Lords have asked what is the effect of the Amendment. The answer is that it has no effect other than to delay the Bill for some 14 days. We are bound to wonder what will happen in those 14 days. Indeed, we can ask a preliminary question: what Bill is it likely to be? It is likely to be a Bill promoted by the Government, so the Government seek a Second Reading of the Bill, and get it using the majority in the situation in which this clause is designed; they take it through Committee and Report, using that majority, and then they get a Third Reading using that majority. Then, in 14 days, do the Government change their mind, does the Chief Whip change his mind, do the Scottish Members who voted for the Second Reading, for Committee and for Report and for the first run of the Third Reading change their minds? It is wholly unrealistic and I say that it is quite wrong to make a problem disappear by a kind of conjuring trick, a sleight of hand, which is all this is. We do not solve the problem, indeed we do not even shift the problem.
Other noble Lords have suggested that we should write this clause into the Bill in order to send the matter back so that the other place may discuss it. I do not know how many of your Lordships joined me on the lonely front seat upstairs listening to Mr. Tam Dalyell raising this question—all credit to him because he made his point—not once but dozens upon dozens of times. The other place knows about the West Lothian question; there will not be a great clap of thunder when they pick up their Times tomorrow morning and discover that someone here has identified the West Lothian problem. They have heard about it, and more than once.
I do not think anything I say will stop noble Lords opposite, who have a determined look on their faces, from trooping into the Lobby to support this extraord-
274
inary new clause. I will not therefore continue much longer, but I stress the important point that if one cannot improve the Bill, one should not support an Amendment which simply conceals the problem.
I must deal with the point raised by the noble Lord, Lord Home of the Hirsel; it was an important one and, coming from him, I must reply to it. He said that unless something of this kind—it is very late in the day to be talking about "something of this kind—was put in the Bill, friction between England and Scotland would be certain. I urge noble Lords to think about it. If something of this kind—and, more particularly, if this something—goes into the Bill, what will happen? Every time a Government Bill comes forward on which this clause would bite the media will focus on the Third Reading vote, identify the Scots who have had the temerity to vote on a matter which does not relate to or concern Scotland, and during that period of 14 days, which I suppose may be 14 Sitting days, the media will concentrate in some cases their venom and in some cases their support, and a tremendous extra amount of Parliamentary pressure will be brought on those Members. If at the end of the day the Scottish Members solemnly go through the same Lobby and vote the same way, what will that do for friction between England and Scotland? That does not seem to take us any further at all.
I conclude by again pointing out that nobody says that this is a solution; nobody in his right mind believes that the other place needs to be told that the West Lothian question exists; and it is irresponsible not to face up to the question which Lord Morris of Borth-y-Gest asked. I beg your Lordships not to chase after this will-o'-the-wisp, and not to support the Amendment.
Lord MONSON: My Lords, the noble and learned Lord challenged those of us who support the Amendment to say exactly, in a responsible way, how it would improve the Bill. I can answer in about a dozen words: it will improve the Bill by helping to ensure indirectly the unity of the United Kingdom.
Earl FERRERS: My Lords, I have no doubt that one day I shall do something wrong, that it will be my fault and that I

275
shall land up in the courts, and if I do there will be nobody I shall turn to quicker than to the noble and learned Lord, Lord McCluskey, to try to get me out of a hole. He displayed this evening—I do not blame him and I knew it would happen—a wonderful ream of arguments against the Amendment. I thought somebody would see fit to try to blast the thing out of the water and it fell to Lord McCluskey to seek to do it, though I thought he removed every shot in the locker, squibs and all, to do it.
The problem is a very real one, though I do not propose to continue the debate for long because noble Lords have heard the arguments both for and against. I did not think Lord McCluskey was quite fair when he said there was some sinister motive whereby the Conservative Front Bench in the House of Commons would put down an Amendment, so what would we get? That was an extraordinary comment and I thought that the noble and learned Lord must have forgotten that at present his Party controls the House of Commons. If he feels there is some sinister motive in this, I can assure him it does not come from us. This is a genuine attempt to meet a problem which has been referred to time and again. The noble Earl, Lord Perth, said in a rather Machiavellian way, "I do not want to vote for this because I think federation is the best thing, and if we do not vote for this Amendment we all know there will be chaos and then, out of chaos, will come federation". With great respect to the noble Earl, that was a rather disreputable argument for voting against the Amendment.
The noble and learned Lord, Lord Morris of Borth-y-Gest, hit on a very important point. I do not think that I
have ever before crossed swords with a law Lord, and I would fluff only a little feather at him. He asked why on earth we have to teach the House of Commons that there is a West Lothian question. Of course the West Lothian question was referred to in another place, but the trouble was that due to their procedures they were unable to put down an Amendment to overcome it. It is because of the procedures which are available to your Lordships, and which are different from those in another place, and because of the alteration, in a very modest way, to the Long Title which will come in the last Amendment, that it is possible for us to give back to another place the Amendment which they wished to have. That does not apply only to Conservative Members there, and I dare say that there lies the reason why the noble and learned Lord was so agitated, because many of the people who were in favour of trying to get over the West Lothian question were supporters of his own side in another place.
That is the reason I suggest that your Lordships should pass the Amendment. At least it would give another place the opportunity of discussing this matter. My noble friend Lord Home of the Hirsel said that the wording of the Amendment was tortuous. I will confess to him that I had a tiny bit of help over the drafting of the Amendment. If he thinks that this wording is tortuous, then all I can say is that he ought to have seen the original.
7.21 p.m.
On Question, Whether the said Amendment (No. 176) shall be agreed to?
Their Lordships divided: Contents, 99; Not-Contents, 72.

CONTENTS

Alexander of Tunis, E.

Craigavon, V.

Elles, B.

Allerton, L.

Craigmyle, L.

Elliot of Harwood, B.

Ampthill, L.

Crathorne, L.

Emmet of Amberley, B.

Bearsted, V.

Crawford and Balcarres, E.

Falkland, V.

Belstead, L.

Crawshaw, L.

Falmouth, V.

Bledisloe, V.

Cromartie, E.

Ferrers, E.

Broadbridge, L.

Cullen of Ashbourne, L.

Ferrier, L.

Burton, L.

De Freyne, L.

Fortescue, E.

Campbell of Croy, L.

Denham, L.[Teller.]

George-Brown, L.

Carr of Hadley, L.

Donegall, M.

Glenkinglas, L.

Clifford of Chudleigh, L.

Drumalbyn, L.

Gowrie, E.

Clitheroe, L.

Duncan-Sandys, L.

Gray, L.

Colville of Culross, V.

Dundee, E.

Greenway, L.

Cork and Orrery, E.

Dundonald, E.

Haig, E.

Cottesloe, L.

Ellenborough, L.

Hanworth, V.

Harmar-Nicholls, L.

Minto, E.

Selkirk, E.

Hatherton, L.

Monk Bretton, L.

Sharples, B.

Henley, L.

Monson, L.

Shinwell, L.

Home of the Hirsel, L.

Morris, L.

Soames, L.

Houghton of Sowerby, L.

Mountgarret, V.

Spens, L.

Hylton, L.

Mowbray and Stourton, L.[Teller]

Strathclyde, L.

Hylton-Foster, B.

Strathcona and Mount Royal, L.

Kinnaird, L.

Moyne, L.

Sudeley, L.

Kinnoull, E.

Northchurch, B.

Swinfen, L.

Kinross, L.

O'Hagan, L.

Swinton, E.

Lauderdale, E.

Onslow, E.

Tranmire, L.

Lindsey and Abingdon, E.

Pender, L.

Trefgarne, L.

Linlithgow, M.

Raglan, L.

Tweeddale, M.

Long, V.

Rankeillour, L.

Vickers, B.

Luke, L.

Reigate, L.

Ward of North Tyneside, B.

Lyell, L.

Rochdale, V.

Wigg, L.

Margadale, L.

Ruthven of Freeland, Ly.

Wilson of Langside, L.

Massereene and Ferrard, V.

Sandford, L.

Young, B.

Middleton, L.

Sandys, L.

NOT-CONTENTS

Allen of Fallowfield, L.

Gregson, L.

Perth, E.

Aylestone, L.

Hale, L.

Phillips, B.

Bacon, B.

Harris of Greenwich, L.

Plant, L.

Balerno, L.

Hatch of Lusby, L.

Ritchie-Calder, L.

Balogh, L.

Henderson, L.

Samuel, V.

Banks, L.

Hirshfield, L.

Seear, B.

Birk, B.

Hughes, L.

Sefton of Garston, L.

Blyton, L.

Jacques, L.

Shepherd, L.

Boston of Faversham, L.

Janner, L.

Somers, L.

Champion, L.

Kaldor, L.

Stewart of Alvechurch, B.

Chitnis, L.

Kirkhill, L.

Stone, L.

Collison, L.

Leatherland, L.

Tanlaw, L.

Croham, L.

Lee of Newton, L.

Taylor of Gryfe, L.

David, B.

Llewelyn-Davies of Hastoe, B.

Taylor of Mansfield, L.

Davies of Leek, L.

Lloyd of Kilgerran, L.

Thurso, V.

Davies of Penrhys, L.

McCarthy, L.

Wade, L.

Donaldson of Kingsbridge, L.

McCluskey, L.

Wallace of Coslany, L.[Teller]

Elwyn-Jones, L. [L. Chancellor.]

McGregor of Durris, L.

Fisher of Camden, L.

Maelor, L.

Wedderburn of Charlton, L.

Gaitskell, B.

Milner of Leeds, L.

Wells-Pestell, L. [Teller]

Gardiner, L.

Morris of Borth-y-Gest, L.

Whaddon, L.

Garner, L.

Northfield, L.

Winterbottom, L.

Glenamara, L.

Oram, L.

Young of Dartington, L.

Gordon-Walker, L.

Parry, L.

Goronwy-Roberts, L.

Peart, L. (L. Privy Seal.)

Moved accordingly, and, on Question, Motion agreed to.

Resolved in the affirmative, and Amendment agreed to accordingly.
7.30 p.m.
Lord WELLS-PESTELL: My Lords, I beg to move that further consideration on Report be now adjourned.

INDEPENDENT BROADCASTING AUTHORITY BILL
The MINISTER of STATE, HOME OFFICE (Lord Harris of Greenwich): My Lords, I beg to move that this Bill be now read a second time. The Bill before your Lordships has but one purpose: to extend the life of the Independent Broadcasting
278
Authority, which would otherwise effectively expire on 31st July 1979—now only 13 months away. The Bill proposes that the authority's life should be prolonged until 31st December 1981.
Your Lordships will recall that it was announced in the gracious Speech at the opening of the present Parliamentary Session, that the Government would be bringing forward proposals for the future constitution, structure and organisation of broadcasting. These proposals are being formulated in the light of the Report of the Committee on the Future of Broadcasting under the chairmanship of the noble Lord, Lord Annan, and the many comments received on the Committee's recommendations. My right honourable friend the Home Secretary intends to publish these proposals soon in the form of a White Paper.

279
Your Lordships will appreciate that the number and, indeed, the complexity of the issues raised in the Annan Report have ruled out the possibility of major broadcasting legislation this Session to implement the Government's proposals. In any event, of course, the Government would not have thought it right to introduce such legislation in advance of the publication of the White Paper. Your Lordships will also appreciate that this major legislation could not he expected to be on the Statute Book much before the middle of 1979, by which time the life of the IBA and its contracts with the independent television and local radio contractors will, if they have not expired, be on the point of expiring.
Independent broadcasting is a substantial industry in this country. It employs some 13,000 people and has an annual turnover of some £300 million. So it would be quite undesirable to leave it until mid-1979 to assure the industry of its continued existence beyond 31st July 1979. The Bill before your Lordships accordingly proposes an interim extension of the IBAs' life for a period of nearly two and a half years beyond 31st July next year. This will enable the Authority to continue to provide the television and local radio services for which it now has responsibility pending the publication and the Parliamentary consideration of the Government's proposals and the implementation of the resulting decisions. I understand that the Authority has reached the conclusion that if this Bill is enacted it will extend the existing ITV and independent radio contracts until 31st December 1981, but that it will continue during this period to develop and, where necessary, improve its programme services. It would, as your Lordships will understand, be impracticable for the Authority to contemplate any changes in the existing franchise areas or franchise holders for a period as short as two and a half years.
It may he for your Lordships' convenience if I were to explain why the Government have proposed a two and a half years' extension, because this is obviously central to our consideration of this particular Bill. Obviously, we need a realistic extension. Equally, however, the extension must not be so long as to be likely to defer unnecessarily the imple-
280
mentation of decisions affecting independent television and independent local radio. The Government consider, on the basis of information from the IBA, that a period of between one and two years from the new legislation receiving Royal Assent will be needed by the Authority to complete the procedures (which the Authority envisages will include public hearings, as recommended by the Annan Committee) for awarding, on the basis of the new legislation, programme contracts, and for these contracts, particularly any new contracts, to come into operation. If one were thinking in terms of this legislation being on the Statute Book towards the middle of next year—and I must not be taken in any way, of course, as anticipating what might be in the gracious Speech at the opening of the next Parliamentary Session—it would be reasonable to suppose that the new contracts might come into operation during the course of 1981; and it is for this reason that Clause 1 of the Bill proposes an interim extension of the life of the IBA until the end of 1981. My Lords, I commend this modest Bill to your Lordships' House, and beg to move that it be now read a second time.
Moved, That the Bill be now read 2a.—(Lord Harris of Greenwich.)
7.35 p.m.
Lord LYELL: My Lords, the House will certainly be grateful to the noble Lord, Lord Harris, for his very clear and detailed explanation of this, as he has called it, modest Bill. I think it is a little more than that. I think the noble Lord is being not quite fair: it is, I believe, a very important Bill, for one or two reasons. Of course, at first sight it is not terribly complicated, but it seems to raise more than one issue. Many of these issues were discussed at considerable length in another place, but certainly I would hope that we in this House can dispose of this Bill with more despatch.
It appears that the Bill will be required for two purposes. The first is to provide, as we have heard from the noble Lord, Lord Harris, a breathing space for another two years before the existing framework of independent broadcasting, both television and radio, needs to be reviewed; and, of course, this breathing space will need to be used all the more

281
wisely. The second purpose is to provide the Government with yet more time to produce their views on the Annan Report, be these views in the form of a White Paper, as suggested by the noble Lord, or possibly in the form of a Green Paper, if he thinks that might be appropriate. However, all of us in this House must agree that some definite expression of view becomes ever more necessary, because such a postponement as is suggested in the Bill means that further concern and worry is aroused all over the country in franchise holders and, indeed, in viewers and listeners.
The breathing space to which I have referred causes anxiety to those who, for various reasons, wish to change the existing structure of the IBA, and especially the television framework. One example that has come to mind, certainly in another place, is that the East Midlands are raising their voices to have a more locally-based television station than the existing arrangement. We have to admit that the existing arrangement has worked particularly well. There was an example, of course, on the occasion of the last revision of the franchises of the independent television authorities, in the way of some feeling of Yorkshire pride which allowed a station to be set up at that stage separate from the station and franchise which had covered the whole of the North of England, from the North Sea right over to Merseyside in the West. But the postponement of such changes for another two years will enable the Annan proposals to be implemented, we hope before 1982. However, there is also concern among the existing franchise holders in both independent television and independent radio, who would like to know as soon as possible whether or not they will be allowed to keep their entire franchise or only a part of it. This uncertainty cannot really be healthy for our broadcasters.
During the debate in another place on this Bill a number of questions were raised. I think all of them were satisfactorily disposed of by the honourable Lady the Minister in another place, but there was certainly one question which caused some anxiety in my mind, and I just wonder whether the noble Lord, Lord Harris, will be able to assist me, possibly in the form of a letter later, or possibly he might have some notes which will enable him to help me this evening.
282
It seems that the broadcasting of Parliament has made a great difference to our work as well as to the lives of our listeners, who may be amused or bored—or possibly they may be appalled, but I hope they are not—by what they hear. Certainly I hear and see things in this House and elsewhere which are often for the worse, yet I believe in everything that is good, especially in this House; and, happily, everything that I have heard broadcast has been for the good. But the query which causes me some worry is the position of Members of Parliament, in both this House and the other place, who have any kind of interest in an independent television or independent radio station, and who are, I understand, for that reason, debarred from appearing in any political programme over the entire independent television or independent radio network. I think I am right in this supposition. But am I correct in thinking that such MPs cannot have their comments reported during the broadcasting of Parliamentary proceedings? If I am correct in this, I think it could be a little hard. I wonder whether the noble Lord, Lord Harris, can help me on this point this evening.
The noble Lord has pointed out that this Bill is a simple one. It seems to exist to rectify the position of the IBA for another two years when, I hope and believe, the Government will be able to use all its intellect to provide a worthwhile framework on to which the Annan proposals can rest. For this reason, the Bill is reasonably satisfactory. I hope it can be given a speedy passage so that the position of the IBA stations is not harmed in any way.
7.41 p.m.
Lord WINSTANLEY: My Lords, as a director of an independent radio company, I must begin by declaring an interest in this matter; but, having done that, I must say that I have no desire to detain your Lordships at this late hour, particularly when there is other pressing business to be completed. Nevertheless, I should find it difficult not to express my disappointment at the sight of the somewhat diminutive Bill which has finally arrived here in a truncated form compared to that in which we originally saw it in print. Noble Lords will recall that when we saw the Bill originally, when it was first printed, it was rather a different Bill. Since then

283
Clause 2, roughly half the Bill, has been taken out and, to conform with that extraction, the Long Title has also been substantially amended.
Perhaps I could, at the same time, express my general regrets that it has not been possible to introduce legislation on any aspect of the Report of the noble Lord, Lord Annan, which has already been referred to. I can understand the reasons, given clearly and succinctly by the noble Lord, Lord Harris, why the Government cannot implement the whole of the Annan Report here and now; and I would join with the noble Lord, Lord Lyell, in congratulating the noble Lord, Lord Harris, on introducing this modest measure, as he called it, so briefly. It has been my experience that the briefer the Bill, the longer the speech that we sometimes get to introduce it. But this has not happened on this occasion.
I must say that a number of matters were highlighted in the Annan Report. They were debated in this House and in another place and were all underlined as being particularly urgent—the disposal, if at all, of the fourth channel; the whole question of independent and of local radio and the control of local radio. I think that there are some noble Lords who hoped that it would have been possible for the Government to introduce some limited legislation on the more urgent parts of the Annan Report; although I understand the reasons given why it is wise to have a White Paper and further debates here and in another place before our minds are finally made up on these very important matters which will affect broadcasting for many years.
But, my Lords, there was one urgent matter which was dealt with in the Bill as it was originally; namely, the operation of Section 4(2) of the Independent Broadcasting Act in relation to the broadcasting of the proceedings of Parliament. This is a matter which I have raised in this House on a number of occasions. Indeed, I drew attention to it more than a year ago in an article in The Times when, I think, other people had not noticed that the operation of Section 4(2) of the Independent Broadcasting Act meant that as soon as we started broadcasting the proceedings of Parliament, the Independent Broadcasting Authority would immedi-
284
ately be in breach of the law if any particular one of a number of noble Lords or Members of another place happened to be speaking. That seemed to be a nonsense "0up with which we should not put" for very long. It seemed au absurd situation; and the Bill as originally printed remedied that.
Perhaps it is appropriate to remind your Lordships of what Section 4(2) does. I speak from memory and without the Act before me. The Section requires the Independent Broadcasting Authority to secure the exclusion from its programme of any expressions of opinion on matters of political or industrial controversy, or matters of current public policy, by a whole range and number of prescribed persons: members of the Independent Broadcasting Authority, directors of the contracting companies, officials and so on. It so happens, as your Lordships will be aware, that a number of these prescribed persons happen to be Members of this House and a number also happen to be Members of another place.
It was proposed to deal with this in a very limited measure merely by inserting another brief clause to say that Section 4(2) would not apply to the broadcasting of the proceedings of Parliament. That, at least, would have put an end to that particular nonsense; but it would not have put things right altogether. It is right to remind your Lordships of the fact that Section 4(2) has a number of effects. It means, for example, when the proceedings of various local authorities are being broadcast (as they often are) by local radio stations, that immediately certain members of the local authorities, county councils, metropolitan authorities or other local authorities, happen to be speaking, the Independent Broadcasting Authority can at once become in breach of the law. In my own area, the moment the Leader of the Conservative Party in the Manchester City Council happened to be speaking, the independent local radio, if there were broadcasting that debate, according to the law would have to fade it out—but not so the BBC; because these embargoes apply only to independent radio or independent television. There is no such restriction on who can broadcast or who cannot broadcast so far as the BBC is concerned. That is an obvious anomaly which many of us think should have been sorted out.

285
I have my own view. I think that the constraints under which the Independent Broadcasting Authority operates—the overall requirement for the Authority to present balanced programmes, to give fair representation to all shades of political opinion, to be impartial and to be dispassionate—are along the lines of the BBC Charter and probably a sufficient safeguard. But I understand the reason why the clause was in the original Act. It would have been intolerable had an individual been able to use his position in a particular station, on radio or television, to promote some particular point of view, he it industrial, political, or any other of the prescribed topics. I can understand why it crept in. But I should have thought that the powers that the authority had already would be enough.
My Lords, let me say that certainly I should like this Bill to have a Second Reading, and I accept the reason given that it is important that these people should not he left in doubt as to their fate; although I am bound to say that there is the odd—I will not mention the name—broadcasting authority whose franchise I would not mind being looked at again fairly soon. I will not go further than that. Nevertheless, I think that for the sake of those who work in this industry, it is important that the present uncertainty should he ended. I think that is very important indeed, particularly when we have, as the noble Lord has said, a White Paper on its way with regard to other matters. I accept that and I have no wish to hold up the Bill. I would merely say this to the noble Lord. I, and, I am sure, other noble Lords—and I daresay Members of the other place—would be more than willing at Committee Stage to insert some limited Amendment, at least, to do away with the nonsense in relation to the broadcasting of the proceedings of Parliament.
The noble Lord appreciates, I think, that I should prefer to introduce some more complicated Amendment, but I know that that might have consequential effects—the Government may not feel that they could cope with it: and we might lose the Bill altogether. But I make that point and perhaps we may hear whether this may be acceptable. If it were acceptable, I should be willing to move some kind of Amend
286
ment which would put some sense into the present position in relation to the broadcasting of the proceedings of Parliament; whereas, at the moment, the Authority is (or could be) in breach of the law every five minutes in broadcasting the proceedings of either House. I leave it at that. I should like to see the Bill have a Second Reading and I shall be interested to hear the comments of the noble Lord on that particular point.
7.50 p.m.
Lord TAYLOR of GRYFE: My Lords, I, too, like the noble Lord who has just resumed his seat, have to declare an interest: I am a director of an independent television company. I am indebted to the noble Lord, Lord Winstanley, for so eloquently putting the point of view which so many of us share regarding the anomalies in this particular Bill. I have found that the introduction of this Bill provided an opportunity for the Government to correct sonic of the anomalies that have been so well described. That was their original intention; the House of Commons, in Committee, removed the appropriate Amendment. Perhaps the noble Lord, Lord Winstanley, will not he discouraged by the lack of excitement in this House tonight to introduce appropriate Amendments at the Committee stage. If so, he can certainly depend on my full support and, I suspect, the support of many noble Lords because the present anomaly creates a situation in, which all Peers are not equal.
We have just concluded a very interesting debate on the future of the Scottish Assembly and its place in the British Constitution. It is a matter in which I am deeply concerned: I live in Scotland and am involved heavily in Scottish industrial and political life. But if I had spoken in that debate, which is presumably broadcast, it would be in breach of the law if anything I said were to be recorded and broadcast in Scotland, or elsewhere in the United Kingdom from that point of view. Under the present arrangements. I am not permitted to appear on independent television or local radio in Edinburgh or in Swansea—it is an all-pervading ban.
This has been applied in the course of my own experience. For some years I was the president of an important organisation in Scotland known as the Scottish

287
Co-operative Wholesale Society, a very broadly owned and important economic organisation in Scotland. We had a centenary and independent television decided that this was worth of note, as it was. So they came into my office, went through the factories, workshops and offices, and so on. They ended their excellent programme with an interview with the president, only to be told by the Independent Broadcasting Authority on completion of the programme that it was not in order for me to appear as president of that organisation and make a few comments on its achievements.
This kind of anomaly should be corrected now. It applies in relation to political debate; it applies also in relation to the proceedings of this House and the other place. Perhaps the noble Lord, Lord Harris of Greenwich, will explain that we are on the brink of looking at broadcasting legislation in terms of the Annan Report. I think we would agree that the Annan Report is such a complex and comprehensive survey of the whole broadcasting scene that one would lose sight of this relatively minor matter about a third or a fourth channel, and so on, if it were brought into the big debate. The appropriate moment to correct an anomaly is now. I hope that we may encourage the noble Lord, Lord Harris, if the Bill reaches the Committee stage, to accept an Amendment that would be helpful in this direction.
7.54 p.m.
Lord FERRIER: My Lords, I shall not delay your Lordships long. In my view, it is essential that this Bill should be given a Second Reading without delay. I am not connected with any broadcasting organisation, but I feel that I voice the opinions of the general listener and I have taken a view on this matter of broadcasting, particularly the broadcasting of Parliament, for a number of years. It is therefore a great regret to me that so many months have gone by since the publication of Lord Annan's Report. We still do not have a White Paper, or, as my noble friend Lord Lyell said, a Green Paper, to "bite" on. Now we are coming to a time, whether or not we like it, when there is going to have to be a General Election. That means further delay. Therefore it is all the more important that
288
this Bill should get a Second Reading now. The remarks of the noble Lords, Lord Winstanley, and Lord Taylor of Gryfe, have taken a great deal of trouble out of my mind because I was going to mention the broadcasting of Parliament. As I have said before—and I hope will say again—my view is that any future franchise to broadcast, either by vision or by radio, should include in its franchise an obligation similar to Section 13(1) (I think it is) of the licence agreement of the BBC.
Be that as it may, I think that I am right in saying that this problem of privilege and everything that the noble Lords, Lord Winstanley and Lord Taylor, have touched upon is under close consideration, and that is all to the better. Judging from what I have heard tonight, I support what those two noble Lords have said in suggesting that this would be an opportunity to bring in an Amendment which would get over the difficulties to which they refer. What is more, that will cover the general problem of prejudice regarding Parliament and the risks in broadcasting what may be regarded as slander or libel. I support the proposal to give this Bill a Second Reading—and the sooner the better! I look forward to hearing the Amendments which are forecast.
7.56 p.m.
Lord HARRIS of GREENWICH: My Lords, I am grateful to those noble Lords who have participated, the noble Lord, Lord Lyell, my noble friend Lord Taylor of Gryfe, the noble Lord, Lord Winstanley, and the noble Lord, Lord Ferrier, who has just resumed his seat, for their welcome to this Bill. I repeat that it is a fairly modest measure; nevertheless it is undoubtedly a significant one in that it lengthens the life of the Independent Broadcasting Authority by 2½ years. There will he a running on of existing contracts, as I have indicated, of both the television companies and the local radio companies. Therefore it would not be right to diminish the significance of this measure.
I will do my best to answer the number of detailed questions which have been raised. The noble Lord, Lord Lyell, began by referring to a certain amount of argument in the East Midlands about the existing independent television contractor. I understood the point that he was making. He will realise—of course he must take

289
this point—that this is a matter for the Independent Broadcasting Authority and not a matter for the Government. It is absolutely right that this responsibility was clearly laid on the authority by Parliament. Therefore I do not think that it would be right for me to make any comment on this though I know that it is a matter of some debate in the East Midlands.
There is the wider question about Section 4(2) of the Independent Broadcasting Authority Act, both in terms of the wider implications which were referred to by the noble Lord, Lord Winstanley, and the narrower question raised by the noble Lord and by my noble friend Lord Taylor. It is right to say that the noble Lord, Lord Lyell, also referred to this. He said he wanted me to indicate what the Government's position on this matter was. He was a little concerned about it. As he will I am sure recognise I would never dream of making a Party point; but I find it mildly surprising that this question should be raised from the Opposition Front Bench, given that it was voted out by Opposition Members in the House of Commons. That is exactly why this particular section is not in the Bill because the noble Lord's friends decided to vote against it in Standing Committee. I have the Hansard in front of me.
Certainly two Members of the Labour Party on the Committee voted against it. There were five Conservative Members of Parliament on the Committee and if they had voted the other way the section would be in the Bill. If I may say so—with a gracious smile in the direction of the noble Lord, Lord Lyell—that is the answer to his question. It is certainly unfortunate that this was voted out. We had come to the conclusion that it was desirable to act in this way. The noble Lord, Lord Winstanley, and my noble friend asked: What would the Government view be so far as this question is concerned in your Lordships' House? They have indicated that they are considering putting down an Amendment on this matter and obviously we will look at it when they do so. It is right for me to respond on one particular point that was raised by the noble Lord, Lord Winstanley, on the wider question of Section 4(2).
I think I must make it absolutely clear that we would find it impossible, within the confines of this Bill, to deal with the
290
broader questions which he identified. I think that is an issue of such complexity that it must await the substantial piece of broadcasting legislation which will he brought before Parliament. Frankly, I think that is the right way for us to proceed. It would be quite impossible, given the complexity of this issue, which I think is recognised by the noble Lord, Lord Winstanley, to deal with it in this particular Bill. However, I repeat that on the narrower question we shall obviously look at any Amendment the noble Lord may put down.
I would make only two other points. I took note of the question raised by the noble Lord, Lord Ferrier, and, as I have indicated to him in the past, we are certainly taking note of his views in our consideration of the Annan Report. I would take issue— "issue" is perhaps a strong word to use and I shall say instead that I would differ from the noble Lord, Lord. Winstanley, only on one point. That is when he referred to what he described as the "urgency" of the fourth channel issue. As he may recall, that was not the view which was taken by the Annan Committee. In Recommendation 96 they said that the fourth channel should not be allocated until the nations' economy would permit the kind of service they had outlined. They also made another state-merit along these broad lines. So certainly we are not in a situation where the noble Lord, Lord Annan, and his Committee are beating on the door and saying that it is absolutely imperative to take an immediate decision on the fourth channel.
Certainly I recognise there are many people in television who are extremely anxious to have a fourth channel. We understand that, but I must make it quite clear that there are clear public expenditure implications so far as a fourth channel is concerned. We are looking at this particular matter in connection with our study of the Annan Report, and I am afraid that it will be imposible for me to give any indication today as to our final decision on this matter. I should again like to thank noble Lords from both sides of the House for the welcome they have given to this measure. I join them in the hope they have expressed that we shall soon have the measure on the Statute Book.
On Question, Bill read 2a, and committed to a Committee of the Whole House.
Lord WELLS-PESTELL: My Lords, I beg to move that the House adjourn until twenty minutes past eight o'clock.
(The Sitting was suspended from 8.3 p.m. until 8.20 p.m.)

SCOTLAND BILL
Further considered on Report.
8.20 p.m.
The Earl of SELKIRK The Earl of SELKIRK moved Amendment No. 177:
Page 31, line 23, leave out ("the home civil service of the state") and insert ("Her Majesty's Civil Service").
The noble Earl said: My Lords, at the Committee stage I drew attention to the reference in the third line of Clause 65 to: "The home civil service of the state". I venture to draw attention to those words because in the English language the word "state" is ambiguous. In the German language you have a thing called "Reich" and "Land"—they are quite different and no one would confuse them. When Louis XIV said, "L'Etat, c'est moi", he had no doubt what he meant. He was not talking of any provincial Assembly; he was talking of the whole of France. That was perfectly clear. But in English this is not clear. I had a discussion with the noble and learned Lord, Lord McCluskey, on this matter and he agreed to see whether he could not find a more suitable word.
Instead of "The home civil service of the state" I am suggesting "Her Majesty's Home Civil Service". I think this is a more dignified title; it is quite clear what it stands for and I think it is important today that we should not confuse the Government of the whole of Great Britain with what might be a provincial government, with the talk we hear from so many quarters of a federal solution. We should get used to it. The day may come when the State has a distinct meaning from that of the United Kingdom Government. It is for that reason—a not insubstantial reason—that I move that in the third line of Clause 65 instead of "the home civil service of the state" we should use the words: "Her Majesty's Home Civil Service". I think this would be agreeable
292
to the Civil Service itself. They are words of dignity and, I think, equity. I beg to move.
Lord McCLUSKEY: My Lords, the noble Earl, Lord Selkirk, has addressed us tonight partly in a foreign language and I hope I shall be forgiven by the House and others if I reply that, for this purpose, le gouvernement, c'est moi. In that
capacity I am happy to accept this Amendment and the related Amendment. I would only add that we are indebted to the noble Earl for improving the language and the elegance of the Bill.
Lord CAMPBELL of CROY: My Lords, may I also add my congratulations to my noble friend. He has done a great deal and studied this Bill most industriously. I am glad that the Government have seen the point of this and been prepared to accept it.
The Earl of SELKIRK The Earl of SELKIRK moved Amendment No. 177A:
Page 31, line 30, leave out ("the home civil service of the state") and insert ("Her Majesty's Civil Service").
The noble Earl said: My Lords, I beg to move.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 178:
Page 31, line 36, at end insert ("respect of").
The noble and learned Lord said: My Lords, may I address myself to Amendment No. 179 at the same time, as they go together. These are both minor technical Amendments to Clause 65(4) and are designed to correct the provisions relating to the remuneration of officers and servants of the Assembly. It would be impossible for the complicated calculations concerning payment of contributions to the Principal Civil Service Superannuation Scheme to be completed within the financial year to which they relate. The payments must therefore be related to the financial year in respect of which they are made, rather than, as the Bill now provides, requiring them to be made within that year. The addition of the words "respect of" in the first Amendment achieves this result.
As it stands, subsection (4) allows the Minister for the Civil Service to calculate the amount due from the Scottish Consolidated Fund in respect of pensions, allowances and gratuities allowable to officers serving the Assembly during the financial year. The second Amendment, No. 179, will enable these calculations to be based not only, as now, on service during the year, but also, as appropriate, on the ending of service (whether on premature retirement or on loss of office for other reasons) and indeed down grading. As I say these are technical Amendments but worth-while. I beg to move.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 179:
Page 32, line 8, after ("service") insert ("their ceasing to serve or their suffering diminution of emoluments").
The noble and learned Lord said: I beg to move.
Lord STRATHCONA and MOUNT ROYAL Lord STRATHCONA and MOUNT ROYAL moved Amendment No. 179B:
Page 32, line 23, at end insert ("and shall be made to the full extent of the amount allowed for the purposes of this section in determining the sums paid into the Scottish Consolidated Fund under section 45 of this Act").
The noble Lord said: My Lords, Amendment No. 179B takes us back once again into the question of tax raising powers. It is a somewhat complicated matter and, as my noble friend Lord Selkirk pointed out in the Committee Stage, one has to keep referring back to Clause 45 on which we had a substantial debate. When my noble friend moved an Amendment on which he asked a question during the Committee Stage, the noble Lord, Lord Kirkhill, in reply produced a wonderfully delphic answer—
"The rate support grant is not part of the arrangements for funding the Scottish administration through the block fund. It arises as part of the spending of the block fund. It is thus a miscellaneous matter arising from the devolved matter in Group 5, of Part I of Schedule 10.".
With that splendid utterance he launched us into a debate of almost unrelieved confusion, which went on for a considerable time and seemed to get worse rather than better as the evening progressed. I hope I am not about to launch us on the same path this evening.
We are dealing here with the question of the tax-raising powers of the Assembly to which we addressed ourselves yesterday. Everybody, even including the Government, agreed that it was desirable in principle that the Assembly should have tax-raising powers. Perhaps that is about as far as we went in agreeing on the matter. But my noble friend Lord Home in particular made the point simply and effectively. In many ways I think it is a pity that the noble Lord, Lord Vaizey, did not persist with his Amendment which would have given direct tax-raising powers to the Assembly, in spite of the quite admitted objections which the noble and learned Lord, Lord McCluskey, pointed out.
At the Committee Stage a number of noble Lords pointed out that the Assembly could acquire tax-raising powers at one remove, as it were, by sequestrating the rate support grant after it had been incorporated into the block grant. I think most of us feel that this would be an improper procedure. If the Assembly is to have tax-raising powers these powers should be overt, clear cut and manifest, and not by some devious under-the-counter device. This Amendment addresses itself, to the principle, any way, of discouraging the Assembly from resorting to some kind of device in order to achieve a tax-raising function. Of course we are dealing with quite a large sum of money. My understanding is that the rate support grant in Scotland could be of the order of £1,000 million annually. It is with some temerity that I launch into the question of local authority finance, about which I have had no experience, although I was fully aware that the noble Lord, Lord Kirkhill, had experience of it. Therefore, I hope that I put a lot of my remarks in an interrogative manner to the noble and learned Lord, and I trust that he will correct me if I am wrong. But there was a great deal of confusion at the Committee stage.
My understanding is that the local authorities approach the Assembly with their suggestion of what the rate support grant should look like. The Assembly then decides in what manner it will pass on that request to the Secretary of State and, presumably, through him to the Treasury. Once that is agreed, the rate support grant is incorporated into the block grant, which is to be fed into the Assembly through the Scottish Consoli-

295
dated Fund, if I have the right expression. Presumably, at this juncture, the Secretary of State could influence the size of the rate support grant if he thought that it was either unduly large or unduly small; and, of course, in the latter case, in particular, it could be important if a local authority was of the same political complexion as the Westminster Government, and the Assembly was of a different political complexion. So that, presumably, the Secretary of State could refuse to pay, if he regarded as unreasonable the request that was made to him for a rate support grant.
This, in turn, raises a number of questions. First, presumably, the Assembly would have the right to pay more in rate support grant to the local authorities under its control than, in fact, had been put into the block grant by the Secretary of State, from the Treasury. I do not know if I am right about this, but I should be interested to know whether I am. Secondly, presumably, it will be made known what the level and amount of the rate support grant is to be, and indeed is proposed to be, during the period of discussion of the level of the rate support grant. This takes us back to the other question which we discussed the other day, about the figures that were to be used in supporting the order for the rate support grant.
In turn, these two questions raise another question. If the local authorities are not satisfied with the way in which the Assembly is handling their approach to the Westminster Government for the rate support grant, do they have any form of appeal? Do they have any chance to go directly to the Secretary of State, to represent their dissatisfaction, one way or the other, with the way in which the rate support grant element of the block grant has been fixed? Once the rate support grant has got into the block grant, I do not think there is any question in anybody's mind that the Assembly has a very large measure of discretion in how it hands it on to the local authorities.
If the language of this Amendment is defective, then, by all means, let us have another go at it later. But I should like to make it quite plain that this Amendment is net intended in arty way to tie the hands of the Assembly, as regards its
296
freedom of action about the distribution in detail of the rate support grant, as between one local authority and another. All we want to make sure is that the amount allocated to the rate support grant is passed on. So that there is no question of interfering with the authority of the Assembly, and it has the right to starve an individual local authority if that, in its wisdom, is what it decides to do.
There is one other question which I hope we can get out of the way, because the noble Earl, Lord Selkirk, and the noble Lord, Lord Kirkhill, got into very serious difficulty on the question of the specific elements of the rate support grant. My understanding that remains is that there are certain elements in the rate support grant which are positively allocated—not just earmarked—over which the Assembly could exercise very little control indeed. Again, these are outwith what my Amendment is concerned with. What we are trying to do by this Amendment is to prevent the Assembly from collaring the money, or, if you like, conning the Westminster Government into putting it into the block grant, and then tucking it away in a fund that may be useful later; or, alternatively, sequestrating it and using it for some purpose other than the rate support grant, which seems to me to he basically an improper procedure.
It may be said that this Amendment would he an attempt to undermine the authority of the Assembly, and would be inviting local authorities to by-pass the Assembly by negotiating directly with the Secretary of State. Again, this is not the intention behind the Amendment, and I do not see why there is any reason to think that local authorities would attempt to cut the Assembly out of the negotiating chain in this way. The Assembly would still he able to force local authorities to put up their own rates, by squeezing them with the amount of rate support grant which it was prepared to allocate to them. This, again, loops us back and, perhaps, points up the reason why I ask the noble and learned Lord whether or not local authorities either individually, or collectively through their association, will be able to appeal about the way in which the rate support grant is fixed.
I do not pretend that this Amendment is, by any means, the only way of dealing with this problem. I suggest that it is a

297
possible way, provided that the Government and the House feel that, in principle, this is a desirable thing to do. If they do not like the device that we are suggesting in this Amendment, then obviously it will be possible to agree some other form of words at the final stage of this Bill. My Lords, I beg to move.
8.38 p.m.
The Earl of SELKIRK: My Lords, my noble friend, Lord Strathcona has raised a very important point here, and I believe that it would help local authorities a great deal if the Government were able to explain a little more fully what is really intended. I am almost certainly wrong in my appreciation of the situation, but I have tried to follow it up. I understand that there will be one figure for the block grant. That will be composed of estimates drawn up by local authorities, health authorities and education authorities, and they will he put together. They will be submitted to the Secretary of State who, I take it, will have the arguments, in part or in whole, with the Treasury. Then the grant of £ million comes through, and it is entirely within the discretion of the Assembly itself how that money is allocated.
It is very nice to say that the Assembly will be sensible; we always end up there. It is said that there will be a lot of common sense and everyone will he perfectly sensible. But, to be quite frank, law is made for both the stupid and the sensible. One has to recognise that in this great world in which we live there are people who are stupid as well as people who are sensible. I want to know what happens now. One may take it that the local authorities know perfectly well what their claim has been. Whether or not they will in detail see how the block grant is made up. I do not know, but I am fairly sure that they will have a keen idea of how it is made up: they will not have much doubt about it.
The allocation comes on the other side. Apart from other things, there is to be an allocation to local authorities. There will be local authority devolved matters which will be entirely the responsibility of the Assembly. There will be reserved matters which will also be the responsibility of the Assembly. Then there will be what are Row called scheduled
298
matters which, so far as I can see, will be the responsibility of the Secretary of State. I do not know whether or not I have got this right, but I understand this to be the case.
So far as the Secretary of State is concerned, most of the scheduled authorities will have specific grants. I understand. from what was said earlier today, that the Assembly will also be able to make specific grants to local authorities, although in general the rule will be that local authorities are quite free to spend their money as they like.
My point is this. Will the Assembly he in a position to say, "We don't like the people who live there, so we shall not give them a grant"? Will the Assembly be quite free to do that, or are we depending upon the common sense and the reasonable point of view of the Assembly? Will the Assembly be quite free to say, "We shan't give any money at all to this district"? That is the picture which I have in my mind, and I think we ought to know the answer. I am not making any accusations against anybody. However, I am saying that I understand that the Assembly will be perfectly free completely to cut somebody off like that.
I ask this question because I believe that the local authorities are not very well informed about this point. If the Government are able to elucidate the way in which this money is to be allocated, which will be very important indeed and which will result in a great deal of discussion and possibly acrimony in some places, it will help towards the good government of Scotland. Therefore I have ventured to pat these questions to the Government.
Lord HYLTON: My Lords, when the noble and learned Lord comes to reply, it would be very helpful if he could give some estimate, although I realise that probably it cannot be very precise, of the proportion of the block grant that will be represented by rate support grant money.
Lord GRAY: My Lords, I share the concern of my noble friends regarding this matter. If it is accurate that the rate support grant is to be contained within the block grant and if, as I am led to assume, the rate support grant total will

299
have been arrived at in response to a case for support made individually and collectively by the local authorities, if it is possible for any of this money to be withheld by the Assembly, surely monies voted by Parliament will not then be applied to the purposes for which they were voted? If this is the case, I think that it raises a very serious issue. I do not know whether I have got this right, but if I have I should be interested to hear what the noble and learned Lord has to say about it.
My noble friend Lord Selkirk referred to possible causes of acrimony between the local authorities and the Assembly arising from this matter. When we speculate on that possibility, it is important to remember the size of, for instance, the Strathclyde region and the sum of money that would be involved in their rate support grant compared with the total sum that is involved in the block grant and the rate support element of that block grant.
8.45 p.m.
Lord McCLUSKEY: My Lords, I believe that this Amendment rests upon a misunderstanding of the financial proposal contained in the Bill. The block fund, to be paid over to the Scottish Consolidated Fund under Clause 45, to which the noble Lord drew attention, will be designed to cover that part of devolved public expenditure which falls to be met by the Scottish Administration but after allowance is made for contributions to devolved spending from other sources, such as local rates. Accordingly, certain assumptions as to such contributions will have to be made at the time when the block fund is negotiated and settled.
May I remind noble Lords of the terms of paragraph 84 of the Government's White Paper, Devolution: Financing the Devolved Services, Cmnd. 6890. Speaking in this context of Scotland and Wales, it reads:
"In assessing the assumed contribution from rates, the Government will need to decide whether it is fair, compared with the expected level of rate income in England and allowing for any special circumstances. It will then be for the devolved Administrations, in further discussions with their own local authority associations, to determine what assumptions should actually be made about rates in the statutory settlement of rate support grant".
300
I believe that that passage expresses the nub of the matter.
In deriving the amount of the block fund from the United Kingdom estimates of total public expenditure, the Government will have to make assumptions about the contribution of local rates and about the amounts local authorities will borrow for capital expenditure. These were sources of income to which we drew attention at the Committee stage. It can then be worked out what their remaining expenditure will be and what will be the requirement, on certain further assumptions, for rate support.
But these assumptions do not commit the Scottish Administration or, indeed, the Scottish local authorities. They must get together and work out a rate support grant settlement in accordance with the procedures of the Local Government (Scotland) Act 1966. That is required by Clause 66 and made possible, as the noble Lord, Lord Kirkhill, mentioned on the previous occasion, by the devolution of powers ensured by Schedule 10, principally by Group 5 in Part I of the Schedule.
On this basis, therefore, there will be no sum within the block fund which can be unequivocally identified as an embryo rate support grant, just as there will be no sum earmarked for any other devolved matter. That is indeed what a block fund means.
It would be difficult, would it not, for the Government, even if they wanted to do so, to work out the precise rate support grant? The Government will have no direct concern with education in Scotland, roads, social work, services, planning, water or other important local government services. They will have no means of conducting the kind of dialogue with the Convention of Scottish Local Authorities which is required by this legislation—the 1966 Act—as a preliminary to the fixing of the grant. It would be quite improper for the Government, when they settle the block fund, to pre-empt all the discussions which should take place between the Scottish Administration, on the one hand, and the Convention, on the other, by laying down a rate support grant figure which must be applied, regardless of the course that these discussions may take.

301
So against that background I would seek to reject the idea that, somehow or other, the Scottish Administration will be out to do down the local authorities and raid the rate support grant element of the block fund for purposes of its own. Indeed, as noble Lords pointed out in the course of these debates, the Assembly will certainly include—and some suggested that it would even be dominated by—people with experience of local government. Whether or not that he so, it is surely clear that the extent to which the work of the Assembly and the Scottish Administration will coalesce with that of local government is likely to create a close working relationship between them and a ready understanding on the part of the Scottish Administration of the problems of local authorities. Furthermore, it must be remembered that there will be a fairly close coincidence between the Assembly's constituents and the local ratepayers; and that, too, should lead to understanding and proper relations between the Administration, on the one side, and the local authorities, on the other.
We appreciate the thought behind this Amendment. We appreciate that the noble Lords who are moving it are anxious to ensure good relations between the devolved Administration and local government, and that they are equally anxious to ensure that there should be no improper handling of these funds. But for the reasons I have suggested we think that they are unnecessarily anxious and concerned. In any event, as I have explained, the Amendment is not really compatible with the system of devolution provided for in the Bill. I certainly have to acknowledge that in a kind of theoretical way the raiding of the rate support grant is a possibility, and I have to concede that it is quite possible that sums larger than those made available to the Administration in respect of rate support grant may in fact be made available to local authorities by way of rate support grant. There is room for what the noble Lord, Lord Strathcona and Mount Royal, described as a measure of discretion, and I acknowledge that.
Mention was made of specific grants. We discussed this subject earlier today, as the noble Earl has reminded us. Specific grants form no part of the rate support grant, which is a block grant. Specific grants will be paid to individual local
302
authorities by the Secretary of State in respect of scheduled functions—as they now are—or by the Scottish Administration as the case may be, depending upon whether the function concerned is a Schedule 15 function or not. On the other hand the rate support grant is a grant not relating to specific expenditures but paid in support of local revenues—that is to say, in relief of rates, as I have said—and it is distributed among local authorities by formula not necessarily directly corresponding to their expenditure on particular matters.
I would seek to draw a parallel between that system and the system which I believe now obtains when local authorities in effect make out a case for a sum of money in the name of rate support grant. They may attribute part of that claim to a particular service for which they are responsible and another part of their claim to another service for which they are responsible, but once the sum is actually determined and once they have received payments of money from that sum they are free to spend it as they properly determine, within the area of their discretion. I do not think that in essence it is any different from what is proposed here.
I was also asked a specific question by the noble Lord, Lord Hylton, and wonder whether I may seek to answer it in a very general way. As I understand it, from the latest figures upon which we have been working—as I explained recently our figures related to 1975 and 1976 and I do not want to be precise about a particular figure but I speak in general terms—it is thought that in the block fund negotiations the discussions which will bear upon rate support grant will lead to a determination by the Secretary of State to pay over about one-half of the sum which ultimately forms the block fund. So the proper answer to the question, shortly, is about one-half, but I do not seek to be exact about that figure. It is just a general estimate. At this stage I do not think I can add anything further, but if I have left any noble Lord unsatisfied perhaps that could be indicated and if it were possible to rectify it by writing I would seek to do it in that way.
Lord DRUMALBYN: My Lords, I should like to ask a question about the "one-half". Was it not generally the

303
case that the rate support grant in total reached about 60 per cent. of the total available revenue? Is it now to be reduced, or by saying "one-half" did the noble and learned Lord mean that it was a payment in two halves from Exchequer sources, one half in advance and one-half later on? If find this very confusing. The noble and learned Lord also referred to the Schedule 15 functions: can he indicate which of those has a direct percentage of the cost or direct grant paid in respect of it and which of them will be in a kind of ancillary block grant coming on to the functions of the Secretary of State and other Ministers? I do not quite understand the position here.
Lord McCLUSKEY: My Lords, with leave, I will just reply to the noble Lord. The clause to which I wish to direct attention is Clause 45, which is the lead clause here. It is the clause which provides that the Secretary of State shall make payment into the Scottish Consolidated Fund of certain sums. It is thought that about one-half of those sums in any one period of twelve months will be sums which are arrived at directly from a consideration of rate support grant requirements. I spoke about Schedule 15, I hope fairly precisely, a little earlier today. By and large Schedule 15 relates to functions of local authorities which are likely to be the subject of specific grant. The main one, of course, is police, to which I have already drawn attention.
If I may amplify my answer in relation to the proportion of the block fund which consists of rate support grant, I am advised that one-half of the block fund is likely to be handed over to local authorities in the form of rate support grant. What proportion of local authority expenditure that will amount to is a different question and will be at the discretion of the Scottish Executive.
Lord STRATHCONA and MOUNT ROYAL: My Lords, the noble and learned Lord has tried very hard and has been very fair, and if he has not completely satisfied us it is probably because of a lack of understanding on our part. I accept that right at the beginning. I think I got one useful clarification out of this: it seems to me that the specific grants are
304
allocated early on and it is the balance of the expenditure which is one of the inputs into assessing what is required in the form of rate support grant. So to that extent I think I am a little further forward than I was. I believe that was part of the trouble that the noble Earl, Lord Selkirk, and I got into at the Committee stage. So that is a step forward.
I am not wholly certain that the noble and learned Lord is completely right about this euphoric picture of the identity of understanding between the local authorities and the Assembly. Clearly that is what we should all wish to see. One of the things that would concern us slightly there, but is not in point of fact an issue to which this Amendment is directed (and I admit it), is the generality of local authorities as represented by the Convention. One would certainly hope that, but of course there is within that the possibility of unhappiness for individual authorities who feel that they have been discriminated against. Glasgow is the obvious one which may or may not receive special treatment because it is a highly special case—the Strathclyde region. I do not think that the noble and learned Lord saidߞand I should be happy if he could interrupt me—whether there was any possibility of the local authorities having any kind of appeal about the level of rate support grant.
Lord McCLUSKEY: My Lords, I will respond to that invitation because I should have replied to that point. The answer is that there is no access by the local authorities to the Secretary of State in respect of this matter. Of course, in respect of specific grant, Where the specific grant is made by the Secretary of State, that is a different question.
Lord STRATHCONA and MOUNT ROYAL: My Lords, I am grateful to the noble and learned Lord. Indeed, I would deduce that from the answer to another question and indeed the general point that he was making about this Amendment, when he said—slightly to my surprise—that it was very difficult to identify as such the rate support grant element in the make-up of the block grant. As I said earlier, this takes us back to the whole question of the way in which the rate support grant will be assembled. It slightly surprises me, but I should like

305
to read with care what the noble and learned Lord has said, no doubt speaking from a highly authoritative brief, about the question of the identity of the rate support grant. One would have thought that, during the negotiations, one of the points that the Assembly would be making to the Secretary of State is, "We shall need a certain amount of money and one element of it, about which we are telling you, Secretary of State, is the money we shall require for the rate support grant. And here is the bit which we are asking for from you for the rate support grant element". The noble Lord is telling us it is not identifiable. If he is right, clearly what we are suggesting in this Amendment is really technically impossible, even if it might be politically or administratively desirable. I feel enlightened. I am quite sure that, in the light of what the noble Lord has said, it would be unrealistic to press this Amendment. I hope that those who understand these matters better than I do will be satisfied with the answers the noble Lord has given, and that we shall not have to pester him again and pursue the matter at Third Reading. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
The DEPUTY SPEAKER (Earl Cathcart): Amendment 179A.
Earl FERRERS: Not moved.
Lord McCLUSKEY: My Lords, I think there has been a mistake. I think the noble Earl meant to move this Amendment.
Earl FERRERS Earl FERRERS moved Amendment No. 179A:
Page 32, line 29, leave out ("reserved") and insert ("scheduled").
The noble Earl said: My Lords, the noble and learned Lord is quite right. I got my tongue twisted. I meant to say I beg to move on behalf of my noble friend.
Lord McCLUSKEY: My Lords, I am deeply indebted to the noble Earl for moving this Amendment in his characteristically forceful way, and I am happy to accept it.
Clause 67 [Public bodies]:
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 180:
Page 33, line 12, at end insert—
("(dd) providing, in the case of a body listed in Part II of Schedule 13 to is Act, for the application of section 49 of this Act;").
The noble and learned Lord said: My Lords, I beg to move Amendment No. 180. The purpose of this brief Amendment is to fill a lacuna in the provisions which may be made by order under Clause 67 relating to a body listed in Part II of Schedule 13. An order under the Clause will be made, as noble Lords will see, if a Scottish Secretary requests it and after consultation with the body concerned. It will normally transfer to the Scottish Secretary certain ministerial powers in relation to the body in order to enable him to carry out more effectively his responsibilities in relation to the devolved matters concerned. Such powers may include powers to authorise borrowing for capital expenditure in Scotland, in which case it is important that the borrowing of the body should be embraced by the control arrangements set out in Clause 49. The Amendment will allow the Clause 67 order to add the body to those already specified in Clause 49. I beg to move.
Schedule 13 [Public bodies]:
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 181:
Page 81, leave out lines 7 and 8.
The noble and learned Lord said: My Lords, this Amendment, like many others I have already spoken to, is consequential upon the decision in Committee to remove aerodromes from the devolved matters in Part I of Schedule 10. I think it is fairly plain what the Amendment achieves. I beg to move.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 182:
Page 81, leave out lines 9 and 10.
The noble and learned Lord said: My Lords, I beg to move Amendment No. 182. This Amendment is designed to remove the British Waterways Board, and the related Amendment, which is No. 186,

307
the Inland Waterways Amenity Advisory Council, from the list of public bodies in respect of which orders may be made under Clause 67. The Amendments are consequential on the deletion of inland waterways from Group 15 in Part I of Schedule 10. Your Lordships will recall that that was done in Committee against Government advice. In this case, as in others I have spoken to of a similar character, the Government make this tidying-up Amendment without prejudice to their ultimate position in regard to the substantive Amendment made in Committee. I beg to move.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 183:
Page 81, leave out lines 11 and 12.
The noble and learned Lord said: My Lords, Amendment No. 183 is, I believe, the last of these Amendments, but it is certainly one of them and it relates to the removal of aerodromes. It is purely a tidying up Amendment. I beg to move.
Lord WIGG Lord WIGG moved Amendment No. 184:
Page 81, leave out lines 17 and 18.
The noble Lord said: My Lords, I beg to move Amendment No. 184, which is consequential upon the acceptance by your Lordships of Amendment No. 114, which I moved last evening. I beg to move.
Lord WIGG Lord WIGG moved Amendment No. 185:
Page 81, leave out lines 23 to 26.
The noble Lord said: My Lords, what I said in relation to Amendment No. 184 also applies to No. 185. It is consequential upon the acceptance of Amendment No. 114. I beg to move.
Lord McCLUSKEY Lord McCLUSKEY moved Amendment No. 186:
Page 81, leave out lines 29 and 30.
The noble and learned Lord said: My Lords, I beg to move Amendment No. 186.
308
I spoke to this Amendment when dealing with Amendment No. 182. I beg to move.
Lord WELLS-PESTELL: My Lords, I beg to move that further consideration on Report be now adjourned.

GREATER LONDON COUNCIL (MONEY) BILL
Examiners Certificate that no further Standing Order is applicable; Ordered to lie on the Table.
LONDON TRANSPORT BILL
Brought from the Commons, read la and referred to the Examiners.
MILE END GARDENS (PORTSMOUTH) BILL [H.L.]
Returned from the Commons with Amendments; the said Amendments considered and agreed to.
CHESHIRE COUNTY COUNCIL BILL [H.L.]
Petition against, from the Welsh National Water Authority, withdrawn.
WEST YORKSHIRE BILL [H.L.]
Petition against, from the National Federation of Building Trades Employers and of the Federation of Civil Engineering Contractors, withdrawn.
STATE IMMUNITY BILL [H.L.]
Returned from the Commons agreed to with Amendments; the said Amendments to be printed.
WRITTEN ANSWERS

  NATIONAL HEALTH SERVICE: FOREIGN PATIENTS
  Baroness HORNSBY-SMITH asked Her Majesty's Government:
  What proportion of in-patients and out-patients in the London teaching hospitals are non-United Kingdom citizens using the National Health Service; and whether they represent an even greater drain on the limited facilities for sophisticated and expensive treatments than private patients.
  Lord WELLS-PESTELL: Information about the nationality of patients treated in National Health Service hospitals is not available. I regret that I am therefore unable to answer either part of the noble Baroness's Question.

  THE VERNEY AND STEVENS REPORTS
  Lord SANDFORD Lord SANDFORD asked Her Majesty's Government:
  Why they have not yet responded to the Verney and Stevens Reports about aggregates and minerals; and when they intend to do so.
  Baroness BIRK: These two reports contain some 160 detailed recommendations covering a wide range of subjects which have required widespread consultations. In addition, the recommendations in the report of the Verney Committee have had to be considered in the light of the subsequent downturn in construction activity which has led to a reduction in demand for aggregates. My right honourable friend the Secretary of State, my right honourable friend the Secretary of State for Scotland and my right honourable and learned friend the Secretary of State for Wales expect to publish their conclusions on these reports later in the year.
  House adjourned at eight minutes past nine o'clock.