Sitting of 23 June 1978

Preamble
The House met at Eleven o'clock
PRAYERS
[Mr. SPEAKER in the Chair]

PAPUA NEW GUINEA (GIFT OF A CLOCK)
Mr. Speaker: I have received from the Speaker of the National Parliament of Papua New Guinea a report of their proceedings on welcoming a delegation from this House on 27th February 1978. I will give instructions for the text of the relevant resolution to be printed in the Journal. The resolution reads as follows:
"That we, the Members of the National Parliament of Papua New Guinea, convey to the Commons House of Parliament at Westminster, our nation's sincere thanks for the gift of the Table Clock to mark the continuing relationship which exists between the Mother of Parliaments and this Parliament."

PAPUA NEW GUINEA (GIFT OF A CLOCK)

  NEW WRITS
  For Manchester, Moss Side, in the room of Frank Hatton, Esquire, deceased.
  For Penistone, in the room of John Jakob Mendelson, Esquire, deceased.—[Mr. Michael Cocks.]

ORDERS OF THE DAY
  HOMES INSULATION BILL
  As amended (in the Standing Committee), considered.
  HOMES INSULATION BILL
    Clause 1

      GRANTS FOR THERMAL INSULATION
      11.7 a.m.
      Mr. Tim Sainsbury: I beg to move, Amendment No. 1, in page 1, line 9, at end insert:
      "either without any insulation or whose existing insulation does not reach the specified building regulations in force".
      We discussed this amendment at some length in Committee. I shall, therefore, try to be brief on this occasion rather than going through the arguments that we rehearsed upstairs.
      The purpose of the amendment is, I think, clear. It is to make the modest grants which the Bill provides available both to householders without any roof insulation and to those householders who either have part of their roof space insulated or have insulation in their loft which is inadequate by the standards prescribed by the building regulations currently in force.
      I should say at once that we welcome any improvement in those standards, however long delayed, and we also welcome and thank the Under-Secretary for the speed with which he has prepared and released the draft of the first scheme, as he promised in Committee.
      I do, however, note that this is the third draft and we were not privileged to see the first or second drafts. We are left wondering what might have been in or what might have been out of those earlier editions. I draw the Under-Secretary's attention to what seems to be a contradition in the explanatory memorandum which he helpfully attached to the draft of the scheme, which seems to be relevant to the purpose of this amendment.
      Paragraph 6 of the explanatory memorandum states:
      "The insulating quilt has to be laid to a minimum thickness of 80 mm."

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      We certainly approve of that.
      "There will be nothing to prevent the householder installing more than the minimum thickness"
      —so even if he is not encouraged, we are glad that he will not be prevented—
      "but the present intention is that grant will be limited to the notional cost of the first 80 mm. This prescribed thickness of 80 mm in respect of which it is intended that grant shall be payable has been selected as being the most cost-effective for the purpose of deploying the limited resources available."
      That is important, but in paragraph 15 an apology is given for excluding those dwellings which already have some insulation:
      "This is again a question of priorities. If a house already has, for example, 40 mm of insulation it is several times more effective in energy terms to put an initial 40 mm in another similar house than to use that 40 mm to top up insulation in the first house."
      Those two paragraphs read in conjunction could me misleading. Paragraph 6 says that 80mm is the most cost-effective thickness but paragraph 15 says that it is not cost-effective to add 40mm to 40mm. There seems, therefore, a strong case for accepting at least the spirit of the amendment.
      Also, it is unfair to exclude those with a partially or inadequately insulated roof space. They may feel aggrieved when a neighbour who has no insulation can get £50 towards this work.
      This exclusion will complicate the scheme. Before they can ask for a grant, householders will have to certify that they have no insulation. It might even pay them to take out what little they have. That will add to the burden of administration. I hope that the Under-Secretary will go some way to meet this case which was strongly argued in Committee and supported by all the opposition parties.
      Mr. Peter Viggers: I support the amendment and I ask the Minister to put aside any briefs and consider the matter again. As I pointed out in Committee, if a house had inadequate insulation, a householder might throw it away to make himself eligible for a grant. The Minister said that he was less cynical about human nature. I should make it clear that I was not advocating that kind of behaviour. I simply wanted the Minister to realise that this legislation will encourage people to behave foolishly.
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      People with the foresight to put in some insulation are the only people who will not be able to benefit. That is preposterous.
      11.15 a.m.
      Mr. Geoffrey Finsberg: The opening words of my hon. Friend the Member for Gosport (Mr. Viggers) might prove unnecessary. If the Minister's brief is to accept the amendment or at least its spirit, I hope that we will disregard what my hon. Friend said.
      The Under-Secretary of State for the Environment (Mr. Ernest Armstrong): The amendment would have to be reworded, but I want to make nothing of that. I want to discuss this important matter on its merits. I would not repudiate anything said about cost-effectiveness, but we must use the limited money available to the best possible effect. That is what the first scheme in the Bill is about. As the hon. Member said, we considered it in Committee. I assure the hon. Member for Gosport (Mr. Viggers) that, far from my just reading a brief, we have considered the priorities carefully.
      I am resisting the amendment, not because of any brief, but because after careful consideration, we considered that the best use of money to achieve the purpose of the Bill—to conserve energy—would be to accept the priorities in the first scheme.
      There is no dispute that if one has, say, 25mm of insulation in one's loft, additional energy savings can be secured by adding further insulation. But that is not the issue before us. Nor is the argument that as energy prices increase the benefits from such topping up will increase. That again I do not dispute. But the fact is that the additional benefits to be secured from each additional thickness of insulation decrease progressively. It is much more cost-effective to put an initial amount of insulation in an uninsulated loft than it is to add further insulation to a loft which already has even a minimal amount of such insulation. In fact 60 per cent. of improved performance in energy-saving terms comes from the first 20mm of insulation, compared with about 20 per cent. from the second and a progressively decreasing amount from each additional slice.
      That is the answer to the point made by the hon. Member for Hove (Mr.

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      Sainsbury) about an apparent conflict between two paragraphs in the Explanatory Memorandum. Of course it saves energy to top up, but it is a question of degree, and the significant figure of 60 per cent. improved performance from the first 20mm.
      Thus, the first priority must be to tackle those houses with no loft insulation at all. That offers the greatest savings, because the person with no insulation will be losing heat much more quickly than someone with even 25mm. That is the answer to those who have installed 20mm or 25mm. They will either be living more comfortably or they will be saving energy. It is for them to make the choice—although, obviously they might feel aggrieved when they see a neighbour getting a grant. This is a conservation measure, not a social measure.
      In Committee it was said that people would not be allowed to put in 20mm of insulation if that was all they could afford. That is true. The first point to make about such a proposal is that insulation quilt is not generally available in thicknesses below 60mm. Secondly, if we are giving grant for the initial provision of insulation, we must grant-aid the most effective thickness having regard to immediate cost effectiveness, the probability of increasing energy costs and the limited resources available. It is not a matter of less than 80mm being wholly inadequate any more than 80mm is wholly excessive. It is a question of balancing the various factors and our judgment is that grant-aiding 80mm will be the most effective means of using the available resources.
      The hon. Member for Hove has performed a service this morning. When we are considering the second and further schemes we shall bear in mind what has been said. In the circumstances I hope that he will withdraw the amendment.
      Mr. Sainsbury: The Under-Secretary's last words were helpful because until then I had been disappointed with his reply. We are reassured to know that he has taken note of what has been said in Committee and in the Chamber. He has been a little more encouraging with regard to the second scheme. We are conscious that this Bill would allow a Secretary of State, if he were so minded, to intro-
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      duce a second scheme a little earlier than the Under-Secretary currently intends. We accept the helpful tone of the Minister's reply. I believe that our criticisms of the scheme remain, but in the light of what has been said, I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.
      Mr. Michael Morris: I beg to move Amendment No. 2, in line 23, at end insert—
      "(3A) The second scheme shall be for the improved insulation of living room windows in the case of dwellings without roof spaces or with inaccessible roof space.'.
      This amendment has two purposes. The first concerns equity of treatment between different categories of householders while the second purpose has to do with performance in relation to energy-saving potential. The Under-Secretary has agreed that perhaps the most significant shift between the initial stages of this Bill and the present time is that the Government have moved from viewing the Bill as a finite measure of set dimensions and vague possibilities for future development to one which they recognise will have further beneficial factors which can be introduced in the not-too-distant future. If this is now to become a dynamic programme, it is much to be welcomed.
      As the Minister knows, there are 14 million dwellings with lofts which it is possible to insulate. Governments of both political complexions have spent money on energy-savings campaigns such as the "Save it" scheme and this has resulted in about 7 million dwellings being insulated. We could argue that these are the wise people who responded to the Government's exhortations. This Bill caters for the 7 million who were unwise in the sense that they did nothing. The Government have introduced their public sector scheme to deal with those in that 7 million who are in the public sector. This Bill is concerned with the private sector.
      The amendment asks the Minister what he proposes to do about the 5 million householders who are still left out of consideration, who did not have an opportunity to insulate their lofts either, because they do not have a loft or cannot get into it. If we can prove that the energy saving from some alternative

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      form of insulation for these 5 million is at least as great as that available to those who insulate their lofts, on the grounds of equity such an alternative source ought to be considered, if not within the Bill, certainly very shortly after its passage in a second scheme.
      These people were not unwise, in that they did not have the chance to insulate their lofts. There are about 1½ million such people in the public sector and about 3½million in the private sector. Those in the public sector do not come within the scheme recently announced by the Government for that sector whereby financial support is given to local authorities.
      In the private sector the 3½million dwellings comprise in part the older cottages, those built in past centuries, where the roof space is narrow and inaccessible with no chance of entry except in an emergency. The numbers are hard to estimate but they probably account for over 100,000 or more of that 3½ million. The second group within that 3½ million is made up of flats. Many of the people excluded will be in the private rented sector. In addition, there are the owners of flats. On grounds of equity I believe that these people have a strong case for consideration.
      Is there a form of insulation which is as cost-effective for these 5 million dwellings as loft insulation is for the other dwellings? I will not go into the detail that we went into in Committee on the basic argument concerning double glazing in the living room. Hon. Members will recognise that the old feeling that loft insulation was in all cases the most effective method is now highly questionable. There is firm evidence that the double glazing of a living room is at least as cost-effective at today's prices. This is logical because the living room is kept at a high temperature. It is the one warm room in the house, irrespective of whether there is central heating. Such a room offers a great potential for energy saving.
      We know that in some cases the capital cost of double glazing is high, but we are informed that the range of costs is somewhere between£10 a square metre on a "do it yourself" basis and£25 a square metre for the more sophisticated installations. I am told that calculations,
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      in which the Department has been involved, suggest that the saving is in the area of£17 per annum. At current prices the economics of selectivity double glazing rooms heated to a high standard, essentially the living room—and I am sure that we could define such a room—are at least as favourfable as most cases of loft insulation. It the case of non-centrally heated houses the economics are even more favourable.
      I believe that grant aid should be provided at least to cover the cost of double glazing living rooms. An argument can be made for all properties to be treated in this way, but for the 5 million dwellings excluded from the present programme I believe that on equity and energy-saving grounds a strong case can be made out for their inclusion in a stage 2 operation which should follow swiftly from the initial programme.
      11.30 a.m.
      Mr. Armstrong: The purpose of this amendment is to lay down for the second scheme under the Bill a provision for the insulation of living room windows. Double glazing would obviously be one of the measures to be taken.
      I am grateful to the hon. Member for Northampton, South (Mr. Morris) for his opening remarks. We cannot over-emphasise the importance of the conservation of energy. The Government have this subject constantly under review. Obviously, once the first scheme has been in operation this winter, we shall be able to assess it as a result of our monitoring.
      An important issue of principle is at stake here. Hon. Members will appreciate that the primary objective of the Bill is to implement the Budget proposals for grant-aid for insulating roof spaces and water supply installations. The secondary objective is to give to the Government the ability to act flexibly and quickly to bring forward further schemes, as and when need requires and resources permit, and therefore a review of what the first scheme does and how it operates will be very important.
      This amendment would restrict this flexibility by laying down in advance what the second scheme should cover. It would prevent a second scheme covering, for example, topping up of loft insulation, or measures to insulate dwellings with flat roofs, or, indeed, the sort

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      of measure which we shall be discussing designed to held the elderly, disabled and others most vulnerable. If this were to be done, we would need to be very sure that the measure to be included under this prescribed second scheme is clearly and unequivocally the most cost-effective and desirable measure after those prescribed in the first scheme.
      I have read carefully the remarks of the hon. Member for Northampton, South in Committee, when he quoted from the brief supplied to Committee Members, but not, I am sorry to say, to me, on behalf of Pilkington Glass. I have since obtained a copy, but although my professional officers have examined the case made, the absence of details, particularly on the assumptions made, has meant that they have found it difficult to evaluate. Nor has there been time for detailed consultation either with Pilkington or with professional officers of the Department of Energy.
      I accept that in some, perhaps in many, houses the double glazing of the living-room window could bring appreciable benefits, but I would want to examine the evidence supplied by Pilkington and other sources of information a good deal more closely than we have had time to do since the Pilkington brief was supplied before I was satisfied that we should commit ourselves now in the way suggested by the amendment.
      In considering the precise terms of the amendment, I am not sure that it is established that there is more justification for double glazing, but this is one of the things that we can go into. I also have considerable doubts about the variety of interpretations which no doubt can be placed upon the term "living-room".
      Mr. Mike Thomas: My hon. Friend gave some indication in Committee on the question of draught-stripping, which is relevant in the sense of what is the first priority for the second scheme. He was positive about it in Committee. It would be more advantageous, particularly to the elderly, for draught-stripping to be an early subject of his attention, and surely it should be an earlier priority than living-room window insulation.
      Mr. Armstrong: Draught-stripping is one of those measures that I have very much in mind. The fact that it is being done in the public sector is an indication of the importance we attach to it. It is precisely because we want to consider very carefully the evidence from Pilkington and, indeed, other sources, and to weigh the merits as between one and another so as to get priorities right, that we want flexibility. For that reason, I do not want to be tied down by the amendment, but I take on board what my hon. Friend has said about draught-stripping, which can and will play a great part in the conservation measures that we will be taking in future.
      The brief supplied by Pilkington Glass and, more important, the detailed evidence which lies behind it will be an important factor in our consideration of further measures to be introduced in later schemes under the Bill, and I undertake to have these matters examined very closely as soon as we are able to do so, and to take any necessary consultations as well. But I ask the House not at this stage to tie our hands in relation to future schemes so that we are required to introduce the particular measures referred to before what may turn out to be some more deserving measures and have rather more priority. In the light of that explanation, I hope that the hon. Gentleman will feel able to withdraw his amendment.
      Mr. Michael Morris: I am grateful to the Under-Secretary of State for his positive response. What he is saying is that he wishes to have further consultations with the manufacturers and interested parties about the whole range of insulation materials. That will be of great benefit and is to be greatly welcomed. We hope that it will be done with some urgency because there is now an abundance of information, and the matter should be brought to a positive conclusion.
      I hope, in addition, that, as we move to a second scheme, we shall reflect on the point of equity. It is an important point that if someone happens to be living in a rather old cottage there are forms of insulation which should be of benefit to him, particularly because he is likely to be on electricity or oil and therefore in the fuel sector that is the most costly.

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      We should not ignore such people because they happen to be in a relatively small number of properties. There should be some means of ensuring that they can benefit at well. But in the light of the hon. Gentleman's positive response, I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.
      Mr. Armstrong: I beg to move Amendment No. 3, in page 2, line 4, at end insert—
      '(4A) A scheme other than the first may pro-vide—

      (a) for grants to be made only to those applying on grounds of special need; or

      (b) to be made, in the case of those so applying, on a higher scale prescribed by the order under subsection (4).

      (4B) For the purpose "special need" is to be determined by reference to such matters personal to the applicant as may be prescribed by the scheme, particularly age, disability, bad health and inability without undue hardship to finance the cost of the works.'.
      Mr. Speaker: With this is will be convenient to take Amendment No. 4, in page 2, line 4, at end insert—
      '(4A) In making other schemes the Secretary of State may make special provision with regard to the types of improved insulation which shall be eligible for grant to applicants who are pensioners, registered disabled or chronically sick.'.
      Mr. Armstrong: My intention in moving this amendment is to respond to the wishes expressed by Members on both sides in Committee that the Secretary of State should have power to make special provision in future schemes for applicants who are pensioners, disabled or chronically sick.
      The original amendment put down by hon. Members opposite in Committee would have enabled the Secretary of State to provide special rates of grant for such applicants. Looking to the future, one of the many uncertainties is the cost of undertaking further insluation measures, and I agree that it would be desirable for the Bill to provide for the possibility of special grant rates and grant maxima for applicants with special needs. Subsection (4A)(b) as set out in the amendment is designed to meet this objective.
      Like all other matters relating to grant rates and amounts, any such special provision would, by virtue of Clause 1(4) require an order made with Treasury
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      approval and subject to negative resolution by this House.
      The earlier amendment, withdrawn by the hon. Member for Hove (Mr. Sainsbury) in Committee, would, I think, have done as I have suggested. However, on further consideration of the whole question of applicants with special needs, I have come to the conclusion that the Bill should be further amended in order to permit the introduction of a scheme or schemes aimed specifically at the thermal insulation needs of such applicants. This would enable the Secretary of State to introduce a scheme offering grant-aid for a measure or measures designed particularly to help all or any of the special groups about which we are all concerned, and to limit grant availability to people falling within those groups. The first part of subsection (4A) as set out in the amendment provides the necessary power for this to be done.
      I have also considered which groups of people should be eligible for these special provisions. As I said in Committee, there may well be groups with special needs other than those listed in the original amendment of the hon. Member for Hove. The second half of this amendment—subsection (4B)—has therefore been drawn in a rather more flexible way, but indicating clearly the particular issues which would be taken into account in determining eligibility for the special provisions to be made within a general scheme, or for the grants available under a scheme limited to those in special need. As hon. Members will appreciate, the main extension to the groups previously included is the case of financial hardship.
      I hope hon. Members opposite will agree that in bringing forward this amendment I have honoured the undertaking which I gave to them in Committee, and that they and my hon. Friends will agree that the amendment has been drawn in a sufficiently flexible way to enable us to help those whose needs are greatest.
      Mr. Sainsbury: We on the Conservative Benches welcome the Government's positive and speedy response to the amendment we put forward in Committee. We accept what the Under-Secretary said about the drafting of his amendment being flexible, with one proviso to which I shall turn later.
      Our welcome for the amendment is all the warmer not only because of the

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      support it had in Committee, where the Government accepted its spirit and principle, but because we are becoming ever more aware of and better informed about, the importance of providing help to disadvantaged groups, especially the disabled and the elderly.
      We are indebted to Mr. Malcolm Wicks for his book, "The Old and Cold", published the day before we started our Committee consideration of the Bill. It is a lengthy book, and we did not have time to read it before the Committee started. It gives factual evidence of the extent of the risk of hypothermia and the importance of doing something, for social as well as energy conservation reasons.
      I believe that I am correct in saying that we still await another important report, that by the Research Institute for Consumer Affairs, which I understand was commissioned jointly by the Department of Energy and the Department of the Environment to examine case studies and determine what improvements could be made in heating arrangements for old people. On 28th July last year the Under-Secretary of State for Health and Social Security said:
      "The results of these case studies will be published in a booklet before next winter."— [Official Report, 28th July 1977 Vol. 936, c. 1119.]
      I do not think that we had the booklet before "next winter", which is now some time ago. I hope that we shall have the benefit of this additional information as soon as possible.
      I now turn to our Amendment No. 4. Does the hon. Gentleman think that his amendment embraces its purpose? The amendment says:
      "In making other schemes the Secretary of State may make special provision with regard to the types of improved insulation which shall be eligible for grant to applicants who are pensioners, registered disabled or chronically sick."
      I emphasise the word "types". The wording of our amendment could be brought into line with the Government's amendment. This is another aspect, in addition to the aspect to which the hon. Gentleman referred, of providing help to disadvantaged groups.
      As my hon. Friend the Member for Northampton, South (Mr. Morris) has just pointed out, it is at the very least
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      arguable that for those who are confined to one room, a living room, which does not have a roof space above it, the most effective form of insulation is double glazing of the living room windows. The Minister has undertaken to have further consultations on that matter.
      In addition to allowing grants, or a higher scale of grant, to be made to those applying on grounds of special need, our amendment would allow those concerned to receive grants for other forms of insulation. This is an important point. The hon. Member for Newcastle upon Tyne, East (Mr. Thomas) rightly referred to draught-stripping as an important aspect of insulation, one which is accepted for public sector housing. It could be particularly useful for the disabled.
      Mr. Mike Thomas: I in no way differ from the hon. Gentleman or my hon. Friend the Under-Secretary as to motives. But I wonder why—perhaps my hon. Friend or the hon. Gentleman knows the answer—the matter with which we are now dealing could not be dealt with under subsections (2) and (5). The questions of sorts of applicants, types of insulation, priorities to be observed between different applicants and so on could all be dealt with under the existing methods.
      Mr. Sainsbury: I hope that the Minister will reassure us that the making of grants for other types of insulation to those applying on grounds of special need will be covered in the schemes that are brought forward. Can the hon. Gentleman also assure us that the further scheme providing help for those in special need will be brought forward very shortly? None of us doubts its importance.
      11.45 a.m.
      Mr. Armstrong: I understand that the report to which the hon. Gentleman referred is with the printers and should be available early next month. It is a valuable report, because it is related to the questions raised by my hon. Friend the Member for Newcastle upon Tyne, East (Mr. Thomas) and the hon. Member for Hove (Mr. Sainsbury).
      The Government amendment covers the Opposition amendment on types of insulation. Under the amendment we could have a scheme—the report is very relevant here—that would deal exclusively

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      with the elderly, under various measures. We may well have to consider separate measures dealing with the particular circumstances in which old people live. They vary from place to place. We could well introduce different types of measures from which they would benefit whatever their circumstances.
      As for the question of urgency, we were pressed very hard in Committee, where it was the unanimous desire to see an early scheme. It depends on resources and so on, but I should like to introduce measures as quickly as is reasonable and sensible.
      Amendment agreed to.
      Mr. Armstrong: I beg to move Amendment No. 5, in page 2, leave out lines 17 and 18 and insert—

      '(a) in Greater London—

      (i) as regards dwellings in a general improvement area or housing action area declared by the Greater London Council under the Housing Acts, that Council, and

      (ii) otherwise, London borough councils and the Common Council of the City of London;

      (b) elsewhere in England and Wales, district councils.'.

      Mr. Speaker: With this amendment we are to take Amendment No. 6, in page 2, leave out lines 17 to 19 and insert—
      '(a) in England and Wales (other than Greater London), district councils and the Council of the Isles of Scilly;
      (aa) in Greater London, in an area declared by the Greater London Council to be either a general improvement area under section 28 of the Housing Act 1969 (as substituted by section 50 of, and Part I of Schedule 5 to, the Housing Act 1974) or a housing action area under section 36 of the Housing Act 1974, the Greater London Council, otherwise London borough councils and the Common Council of the City of London; and'.
      Mr. Armstrong: The purpose of the amendment is to make the Greater London Council the authority responsible for payment of insulation grants in the general improvement areas or housing action areas that it has declared. As the Bill stands, the GLC cannot pay these grants at all. The London boroughs are the only grant-paying authorities in Greater London.
      There is no difference in purpose or in effect between this amendment and that tabled by the hon. Member for Hamp-
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      stead (Mr. Finsberg). The difference is a matter of drafting. There is, for example, no need to specify the precise sections of the different Housing Acts.
      Loft insulation is a requirement of house renovation grants, but is not itself eligible for renovation grant. Applicants for house renovation grants who are installing insulation will therefore need to make a separate application for insulation grant. This is not a bureaucratic or unnecessary requirement—quite the contrary.
      The procedures which we have in mind for the insulation grant will be extremely simple and will avoid the complexities of the house renovation grant system. We intend to ask authorities to set aside a sufficient proportion of their resources for insulation grant to satisfy the demand from their renovation grant applicants. Because of the time lag between approval of project and payment of renovation grant, they should have adequate prior knowledge of the amount likely to be involved.
      In Greater London, the GLC is the sole grant-paying authority for renovation grants in the general improvement areas and housing action areas which it has declared. As the Bill stands, people would have to apply to the GLC for their house renovation grant and to the appropriate borough for their insulation grant. This would be unnecessarily confusing, particularly to a householder seeking to obtain both grants, because the GLC is seen as the source of all grants for dwellings in these areas. We cannot reasonably expect the householder to distinguish between renovation grants and insulation grants. To him, they are birds of a feather.
      It would also be difficult for the two authorities. The London boroughs would not necessarily allow for all the GLC house renovation grant applicants who required insulation grant. The GLC could not help these applicants either. The authorities might also have differing views about the work to be done.
      It is therefore better to make the GLC the sole grant-paying authority in its GIAs and HAAs for both house renovation grants and insulation grants. Since the GLC can declare HAAs and GIAs only with the consent of the borough concerned, this would not seem to be a

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      matter which would in any way undermine the responsibilities of the boroughs. At present there are only eight GLC GIAs and HAAs in Greater London.
      I hope that the hon. Gentleman will feel that the amendment covers the point he was making.
      Mr. Geoffrey Finsberg: I am grateful to the Minister. I hope that he will forgive me if I speak rather slowly, because he might need some advice. He said that the amendment in his name is better than mine, and I accept that at once. But according to my reading of page 2 of the Bill, his amendment now leaves us with two subsections (b), which cannot he correct. My amendment would have given us a subsection (a) and a subsection (aa). According to the Minister's amendment, subsection (b) reads:
      "elsewhere in England and Wales, district councils.'.
      However, he has not deleted line 20 in the Bill, which is also a subsection (b) and which reads:
      "In Scotland, islands and district councils."
      Therefore, it may well be that his draftsmen are as inaccurate, or as otiose as mine.
      Having said that, I should also like to ask whether I am correct in assuming that the Isles of Scilly are still included, because one distinguished Member of this House might be interested in any prospect of insulation grants. I think the Isles of Scilly are being left in, because they appear in line 19, which is not being deleted.
      As always, parliamentary draftsmen are, on the face of it, more accurate than anyone else. It certainly appears that the Minister's most helpful amendment would cover the points that I have sought to raise. It makes sense that the GLC, which is already the sole grant-making local authority in its declared housing action areas and general improvement areas, should in those areas, be the local authority to make grants under the Bill. As the Minister has said, the amendment is designed to make this simple provision, which has the merit that its operation by the GLC can be easily incorporated into the council's existing administrative procedures which relate to home renovation grants. Without the amendment it might be found that the inconsistency as to the authority responsible for renovation
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      grants on the one hand, and insulation grants on the other, may cause the boroughs to make additional provision in their administrative arrangements relating to the processing of applications for the various grants.
      No one would want to see that happen. Therefore, the Minister has most helpfully recognised this in what he has said. I am not quite sure whether he is yet in a position to answer my point. It might be a little difficult to continue talking to the amendment without necessarily repeating myself. I hope that the advice has reached him, and I am delighted to give my support to the amendment which he has proposed if, in fact, it is accurate.
      Mr. Armstrong: I am grateful to the hon. Gentleman for slowing down his speech. I acknowledge that I constantly require advice. I am bound to say that in the changing society in which we live, my advice to my grandsons with regard to a career which would last them the whole of their lives would be to become parliamentary draftsmen. My admiration for those people never ceases.
      I am told that if the amendment requires altering with regard to subsection (a) and subsection (b), no parliamentary action is necessary because the printers would correct it. I am also told that the Scilly Isles are included.
      Amendment agreed to.
      Motion made, and Question proposed, That the Bill be now read the Third time.
      11.53 a.m.
      Mr. Sainsbury: I said at the outset that we Conservatives had no intention of delaying the Bill. We welcome its intention. Our only regret was that it had taken so long to bring forward, and we still hold to that view.
      Criticisms has been made of the Bill which I think the Minister and, I hope, those experts in his Department, have taken on board and will be reflected in further schemes. The most serious criticism of the Bill as it now stands is that there is still this element of unfairness as between one householder and another to the extent that help is available to those who have no insulation in their lofts or on their water tanks but it is not available to those who have some or inadequate insulation. In addition, help is

      905
      not available for some schemes which we Conservatives believe could be equally worth while.
      This is particularly adverse for those who live in flats. Understandably, the majority of people who live in flats do not have a roof space. In particular where one has a flat which is several storeys above ground level, or if it is well exposed to the winds blowing off the sea in a south-westerly direction, as some in my constituency are, other forms of insulation, such as draught proofing or double glazing, would be equally worthwhile. But under the first scheme these are not eligible.
      There is also the point that to some extent there is discouragement to provide the insulation to the higher standards which other countries now require. The Minister said that one cannot overestimate the importance of energy conservation. That is a sentiment with which we Conservatives would certainly agree. But we remain somewhat surprised that, having said that they cannot overestimate the importance of energy conservation, the Government have been somewhat slow in bringing forward worthwhile measures for energy conservation.
      The Bill is not as good as it could be. It is not as good as we believe it should be. However, it does some good and we do not want to delay it. It has one great advantage, because in some senses it is an enabling Bill which provides for the Secretary of State to bring forward schemes. We now know the content of the first scheme and we have had an indication from the Minister as to what he might wish to see in the second scheme.
      We confidently expect that others sitting where the Minister now sits will shortly have the opportunity of bringing forward further schemes. To the extent that the Bill in no way restricts the next Conservative Secretary of State from making more active, positive progress on energy conservation—and, indeed, provides him with the power so to do—we very much welcome the Bill.
      11.56 a.m.
      Mr. Geoffrey Finsberg: I should like briefly to add one word. Of late, the Department of the Environment has
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      taken to issuing some very helpful explanatory leaflets when regulations or new legislation come in. This will clearly be a fairly complex problem, because people may not understand the sort of language which discusses 20 mm. and 60 mm. or the difference between renovation grants and insulation grants. I therefore issue a plea that the Department continues the excellent start which it has made by producing a leaflet which can explain in ordinary language which our constituents can understand so that they know exactly what to apply for and what they are eligible for.
      It might perhaps be helpful if a further precedent were followed and supplies were made available not merely to the local authorities but to organisations such as Citizens' Advice Bureaux, which do such excellent work. Perhaps such a leaflet might also go to Members of Parliament, who clearly will get queries on this point.
      11.57 a.m.
      Mr. Viggers: Having waited for some time for new building standards, we now find that loft insulation is to be 50mm. under the building regulations, yet under this Bill there is a requirement for 80mm. in order to qualify for a grant. It is extraordinary that the Government have put themselves in a position where they are applying different standards to the building regulations and to the Homes Insulation Bill.
      Although the Bill has been described as an energy conservation measure, it is remarkable that no energy Minister has been present in the Chamber during Second Reading, in Committee, or on Third Reading. This point is relevant, and not simply a minor personal point, because the Bill was introduced by a Minister who amazed the House by saying that the largest loss of heat was through the loft. In fact, to anyone who studies the subject, it it well known that that is not true and that the largest heat loss is through walls. But it is also relevant—and I am not merely making narrow personal points—because we know that in this country a planned, coherent policy put across with conviction on energy conservation is badly needed, and that is just what we do not have.
      Loft insulation lends itself to a national and imaginative scheme. One has only

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      to think of the programme for converting houses from town gas to natural gas. That was a major national programme co-ordinated by the British Gas Corporation. A programme of loft insulation could lend itself to a similar campaign where people living in specified roads would know when the men were coming to insulate lofts in the area and that theirs would be left out if they did not take part in the scheme. To have had such a scheme would have required some kind of leadership. However, this Government, being a Socialist Government, choose to adopt the Wilfred Pickles approach which is to "Give 'em the money."
      There is only one disqualification for receiving the money under the scheme, and that is, if a householder has been thoughtful enough already to insulate his loft, he is not eligible under the Bill. This really is a charter for foolish virgins, and one is forced to say that delay and dither has been replaced by bungling. But that should not prevent us getting across the message that insulating lofts and lagging hot water tanks is the best investment that householders can make. If this Bill helps get across that message, the Opposition will not oppose it.
      Mr. Roger Moate: I must apologise for entering this debate so late. The speed of progress took me rather by surprise.
      I wish to make a short contribution on Third Reading which, in a sense, repeats what I said during the earlier stages of the Bill. It is to register some complaint about the wrong priorities which the Bill introduces into our improvement programme.
      I have no objection to the basic principle of providing improvement grants for the insulation of lofts. It is an excellent idea in principle. What I find objectionable—and the same goes for many of my constituents—is that the Government can find money for this proposition at a time when they have to reject urgently needed improvement grants for other desirable cases.
      Mr. Armstrong: Where?
      Mr. Moate: I can tell the Minister where. It is in the Swale district of my constituency.
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      I do not regard this as a party issue. There is general agreement about the need to have a first-class improvement programme. A deputation from Swale came to see one of the Minister's colleagues about this matter, and my constituents were given a sympathetic response and told that at a later stage in the year additional money might be forthcoming to help them. But that money is not there at present.
      I have a case in mind which is very relevant. Yesterday, I received a letter informing me that the council was not able to give an improvement grant because it had no money.
      Mr. Speaker: Order, This is Third Reading, and the hon. Member must direct his remarks to what is in the Bill.
      Mr. Moate: I hope that I shall be in order in saying that I do not think that the Bill should have a Third Reading until—
      Mr. Speaker: That is permissible, of course. But the hon. Member is not entitled at this stage to say what he thinks ought to be done in place of the Bill. He must discuss what is in the measure.
      Mr. Moate: Then, may I give my reasons for thinking that the Bill should not have a Third Reading?
      Mr. Speaker: It is no good the hon. Member talking about other provisions which ought to be included. His remarks must be directed to the provisions which are in the Bill.
      Mr. Moate: Perhaps I shall be in order if I say that the money provided by this Bill should be applied to another purpose. Will that be in order?
      Mr. Speaker: Not if the hon. Member starts to outline the purposes.
      Mr. Moate: I think that it will be sufficient for me to say that we have been deprived of money necessary for improvement grant programmes. I can quote many examples of houses which might be eligible for roof insulation grants but which cannot have the necessary money to build inside toilets when young children are having to use chemical flush toilets.
      Mr. Armstrong: Absolute nonsense.
      Mr. Moate: The Minister says that is nonsense. I can give him chapter and verse. It is the absolute truth.
      Mr. Speaker: The hon. Member can give chapter and verse some other time.
      Mr. Moate: I shall do it some other time. I simply wish to register a protest on behalf of people who have been deprived of much-needed improvement money. Preference is being given to other measures which do not deserve priority and other areas are getting preference over my constituency.
      Mr. Armstrong: I am grateful for the very constructive suggestions made in Committee and again this morning on Report. In relation to further schemes, we shall consider such matters as double glazing, draught-stripping, and so on, but without commitment to any schemes which will be brought forward. Certainly we shall bear in mind all that has been said.
      The Government take very seriously the conservation of energy, and I speak with conviction when I say that. But we had to find a simple scheme which was easy to administer and, above all, easily understood. I take on board what the hon. Member for Hampstead (Mr. Finsberg) said. People are put off improving their homes because of all the forms
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      and bureaucracy. That is why this scheme is so simple. We hope that it will be easily understood. An explanatory leaflet will be issued, and we are also in touch with voluntary bodies to make sure that the elderly and other vulnerable groups especially are aware of the grants that are available and what can be done.
      Mr. Geoffrey Finsberg: Again this may be normal practice. If it is not, will the Minister undertake to look at the final draft of the leaflet to ensure that it satisfies him? If it satisfies him, I am sure that it will satisfy all of us.
      Mr. Armstrong: I am grateful for that comment. I am always asking for the ordinary man's guide to all these matters. I have to answer hundreds of letters on rent legislation, and I think that the House knows how difficult it is to devise a form of words which is easily understood. We shall issue an explanatory leaflet with every application form, and I give the hon. Member the assurance that I myself will look at what is proposed.
      This is one more measure in a series which the Government have brought forward to deal with this very important matter, and I commend it to the House.
      Question put and agreed to.
      Bill accordingly read the Third time and passed.

IRON AND STEEL (AMENDMENT) BILL
Not amended (in the Standing Committee), considered.
IRON AND STEEL (AMENDMENT) BILL
  New Clause 1

    REDUCTION OF BORROWING AND INVESTMENT LIMITS
    'The borrowing and investment limits set out in section 1 above shall be progressively reduced in successive financial years by the total sum obtained by the Corporation from

    (a) the realisation of assets, and

    (b) such injections of private capital as may be obtained from joint venture projects.'. —[Mr. Norman Lamont]

    Brought up, and read the First time.
    12.8 p.m.
    Mr. Norman Lamont: I beg to move, That the clause be read a Second time.
    The purpose of the clause is to ascertain the Government's attitude to increasing the number of joint ventures with private enterprise which the British Steel Corporation might consider embarking upon and to the sale of assets. It is the view of the Opposition that, in the present circumstances of the Corporation, these two courses of action ought to be considered because they are one way in which the very weighty calls on the taxpayer might be reduced.
    In the course of the Second Reading debate, considerable interest was shown in the possibility of selling off some assets, especially by hon. Members who had been considering those constituencies where plants were to be closed because they were not profitable.
    In a number of instances which have been much publicised the Corporation also wanted to close plants, even though they were profitable. Altough the plants are making money they are old fashioned, and they do not fit in with the Corporation's overall plan. But that is not necessarily an overwhelming argument for closing them. A number of them, because they are fully depreciated, are making money and could be fitted into someone else's business. The Opposition believe that consideration should be given, in the event of closure, to selling them off to other investors.
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    The argument is put that we must not damage the commercial interests of the Corporation, but it does not say much for the costly investment in these great steel cathedrals if the Corporation is not confident of meeting competition from what it calls old-fashioned plant.
    Then there is the consideration of the jobs that will be lost. If an old-fashioned plant is perhaps making money but the Corporation does not think that it will fit into its activities, it would be far better from the point of view of jobs if the plant were offered to private entrepreneurs. This suggestion should be considered seriously.
    My hon. Friend the Member for New Forest (Mr. McNair-Wilson), who cannot be here today, took up the matter directly with the chairman of the BSC. When ne saw an advertisement in the newspapers for the Corporation asking people to invest in areas where there were to be closures, he wrote to the Corporation asking whether it would be prepared to sell complete steel works. He received an answer from Sir Charles Villiers on 30th March.
    "BSC would of course be interested to hear if there were purchasers for complete steel works. This is something that we would be ready to discuss either directly or through BISPA. I should, however, point out that the equipment in each case is very old-fashioned and would not be suitable for modern economic operation. Indeed, with steel prices at their present levels, I doubt whether even the hardiest investors would be able to work up an attractive proposition."
    That reply from Sir Charles was clear. He doubted whether old-fashioned plants would be attractive to any business, but he was prepared to consider selling them.
    It was after Sir Charles had made some subsequent remarks in Germany which seemed to contradict what my hon. Friend had been told that he wrote again to Sir Charles and received another letter on 24th April. It said:
    "At this time of continuing over-capacity in steel BSC must safeguard its commercial interests in any deal involving the sale of any of its assets."
    That was clearly a shift in position between the two letters. As my hon. Friend said, if Sir Charles had intended that the plant, if sold, should be used purely for manufacturing jam tarts, for example, he would not have entered his caveat about doubting whether any investor would be able to make a go of

    913
    producing steel at these plants. Regardless of whether they are profitable or unprofitable—and some of them certainly are profitable—we believe that from the point of view of jobs the BSC should consider selling them to the private sector rather than closing them.
    I suspect that many trade unionists will be disappointed if the Government intervene in this matter, and if the shift in the position of the Corporation is attributable to political interference.
    Today the production of steel will stop at Shelton. The Secretary of State has decided not to intervene. Shelton is precisely the sort of area where perhaps one could have considered some sort of proposition. It has been operating at 75 per cent. capacity, but making a profit. Many people consider that it could make profits of £3 million or £4 million if only it had its own electric are furnace. Since the Corporation is losing about £500 million a year, it seems extraordinary not to consider selling off either profitable or unprofitable assets which do not fit in with its strategy.
    What would any commercial company do if it was faced with losses on that scale? It would go through its assets and see what could be sold in order to reduce the losses. This point was made clearly and very well in a report produced by the British Iron and Steel Consumers Council. Its chairman is the former Labour Minister, Sir Richard Marsh. That report said:
    "A company in the private sector faced with financial crisis on the scale of BSC would have to divest itself of activities not central to its business if it wanted to be able to fund the investment needed to maintain competitiveness and the ability to provide employment, in its central activities in the longer term."
    The report goes on:
    "In its present situation there seems to be no justification for the BSC retaining any activities which have consistently failed to generate wealth and earn profits comparable to those of companies in similar lines of business in the private sector. They should be disposed of as going concerns. This would relieve BSC management of additional responsibilities and reduce the scale of public funds needed to support the BSC."
    That point is extremely well made and well put. I very much agree with what Sir Richard Marsh has said.
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    In the past the Corporation has done this. The Minister of State knows that four years ago it was done in Manchester with the Openshaw works. The BSC wanted to close the works and they were sold to the private sector. They now employ 1,400 people. Similarly there were the Brymbo Works which were sold to GKN. Why cannot the Corporation consider such a policy again, particularly at a time of mounting losses?
    It would also be a particularly good policy to consider at a time when more and more people are becoming doubtful about these large steel cathedrals. Many people wonder whether small is not beautiful in steel production, and whether electric are furnaces should not play a large part in our overall steel production.
    Recently Sir Charles Villiers received a letter from Mr. Dick Eddy, one of the steel workers at Llanwern. He questioned the whole concept of large integrated works. He said:
    "Across the fields from Llanwern the future of strip steel already emerges—the Alpha private steel mill which will produce 800,000 tonnes a year on 500 men. Llanwern has problems doing that with 10,000 men."
    Of course he is right. The progress of the Alpha steel mill has been remarkable. It has 300 workers producing one-tenth of the output of Llanwern which employs 10,000 men. The Alpha works are planning to work up production in their four electric are furnaces to 1 million tonnes, and after that they are considering installing cold rolling mills which can convert hot rolled coil into the cold reduced form that win be needed by the motor industry. If that expansion takes place, more men will be taken on—perhaps up to 1,000—and then Alpha Steel will be producing 1 million tonnes of steel a year with 1,000 men. That does not compare at all badly with Llanwern producing 2½ million tonnes with 10,000 men.
    These large integrated plants have been very expensive and are very vulnerable indeed. Port Talbot and Llanwern, for example, are highly sensitive to industrial disputes and technical problems. One thing after another seems to stop them getting the long lines of production that are necessary to make the sort of profits that were projected when the money was invested.

    915
    We have the dispute with the blast furnace men. Before that we had Llanwern out of action last year with the electricians' dispute which lasted several weeks. For five years the Corporation has invested more than any other steel company in Europe in large plants, and yet it has consistently failed to achieve the economies and the returns that were projected.
    This relates to the problem of selling off the small plants that the corporation wants to close. Work has been transferred from these small plants, such as Shelton, to these great steel cathedrals. Yet despite this transfer of work, they still remain disappointing in their results.
    What happens when these interruptions to production occur at the large plants. The BSC finds itself having to import steel. The BSC is third in the league of the 20 European steel producers, but is the only one which has to spend £4 million a week on the importation of steel. Therefore, from a national point of view the Government, rather than seeking to close old plants, should examine the total national picture. That is far better than having to resort to imports. It would be far better if investment had been made by the private sector in these plants, perhaps with electric arcs. That is the way to cut imports and create more jobs.
    We are not trying to tell the Corporation what it should do, but we are saying that the selling off of plant by any company which is in financial difficulties is a matter which the private sector would automatically consider. It is reasonable that the same disciplines should apply to the BSC.
    The same argument applies to joint ventures. The BSC has gone in for such ventures with the private sector on a number of occasions in the past. There are plenty of such ventures overseas, and recently a good deal of attention has been given to the joint venture on which Redpath Dorman Long is embarking with the Dutch. We could do more on those lines because the calls by the Corporation on the taxpayer have been very large. One method of reducing that call is to go in for more joint ventures and to sell off plant which does not fit in with the Corporation's overall strategy.
    916
    That is why in the clause we have suggested that the overall borrowing from the Government could be reduced by the extent to which a policy on these lines is followed. It is sound commercial logic, it is what happens in the private sector, and I do not believe that a good argument can be made against our proposal. Therefore, I hope that the Government will support it.
    The Minister of State, Department of Industry (Mr. Gerald Kaufman): The hon. Member for Kingston upon Thames (Mr. Lamont) used very fierce words indeed about the large integrated steel works. He said that they were very expensive and very vulnerable, and used a whole stream of hyperbole to describe them. But he must remember why we have this strategy. This is the basic strategy of concentrating bulk steel production in coastal sites, which was an integral part of the Conservative Government's plan for the development of the BSC. That policy was set out in the 1973 White Paper.
    We know that the Opposition are trying to rewrite history in an effort to give the country the impression that what happened between 1970 and 1974 is nothing to do with them now, but it was that White Paper which began that process. It is fair to say that the strategy was selected against a different background with different market prospects from those obtaining today. It could well be that if those investment decisions were being taken now rather than then, some of them could well have turned out differently; but one cannot put the clock back. Approximately £1,000 million has already been spent on large plants, or will be required to complete develop ments which are substantially under way.
    We are not talking about a situation that can be rectified by a stroke of the pen or by the acceptance of a new clause today. It is a strategy which was fully endorsed by the previous Government and which is now working its way through, except in cases where the strategy has been changed.
    One of the problems is that this country, because of the market problems and other factors, is suffering from overcapacity in the steel industry. Whether mini mills or plants which the BSC now

    917
    seeks to close are in its hands or in private hands does not alter the capacity problem. Because of these factors, this country is faced with considerable overcapacity and transferring some of that over-capacity from public to private hands does not lessen the problem. The hon. Gentleman did not deal with that aspect.
    I cannot add anything to what was said by my right hon. Friend the Secretary of State for Industry in a letter to the hon. Member for New Forest (Mr. McNair-Wilson) and in a letter from myself to my hon. Friend the Member for Stoke-on-Trent, Central (Mr. Cant) on the possible sale of plant which the Corporation is thinking of closing.
    The operative sentence in my letter of 19th April was:
    "We would of course expect to be fully consulted in advance of any such proposals"
    —that is proposals in respect of the sale of steel works—
    "and would consider them very carefully."
    I cannot go beyond that statement, but I would add that over-capacity remains over-capacity in whoever's hands it is.
    The hon. Gentleman also spoke about joint ventures. As he fairly pointed out, the Corporation examines and participates in joint ventures from time to time. There may be circumstances in which such ventures make sense. The Corporation keeps under review activities of subsidiaries so as to ensure not only profitable operation, but the best use of resources for the group as a whole. There will be times when it is advantageous to dispose of shareholdings and form joint ventures. The deal with the Dutch group, to which the hon. Gentleman referred, leading to the formation of a joint company to ensure the future of RDL's platform building activities is a case in point. The Government expect to be consulted about significant disposals and we will not accept indiscriminate hiving off of the Corporation's assets which would in the long term weaken public enterprise in steel related activities. But if the Corporation considers that potential joint ventures are worth recommending to us, we will consider them.
    I hope that after the prolonged discussion on the steel industry that has taken place for more than seven months
    918
    the hon. Gentleman will have come to the conclusion, as I have that, wherever one looks at the problems of the BSC, apparently easy solutions do not turn out to be easy at all. Therefore, I hope that the Opposition will not press the clause.
    Question put and negatived.

  New Clause No. 2

    ANALYSIS OF REPORT AND ACCOUNTS
    'No loans or payments may be made by the Secretary of State by virtue of section 1 above until the Corporation shall have provided the Secretary of State with a computer analysis of their reports and accounts for the last five years and of their current forecasts which would include current and anticipated levels of: (a) stocks, (b) wages and salaries, and (c) pension liabilities.'.—[Mr. Michael Marshall.]
    Brought up, and read the First time.
    Mr. Michael Marshall: I beg to move, That the clause be read a Second time.
    Mr. Speaker: With this we may take New Clause No. 3—"Prospects for Steel"—and New Clause No. 4—Annual statements on project appraisals and costs of maintaining uneconomic plant.
    Mr. Marshall: This group of clauses covers a vast canvas. I wish to express my appreciation for the way in which the Chair and the Clerks at the Table have been helpful in trying to consider this Bill.
    It is one of the problems which this House continues to face that in view of the substantial amounts of public money that are now at stake in BSC, the House must properly concern itself in greater and ever-increasing detail with these matters. Hon. Members on both sides of the House would be happy if BSC's fortunes were such that we could see a substantial improvement so that we would not need to make a detailed examination both of the Department and, by implication, of the work of the Corporation.
    We are proposing in this group of clauses to seek additional annual reports relating to the prospects for steel, annual project appraisals, and annual assessments of the cost of uneconomic plant. We are also seeking to bring in computer analysis to the report and accounts of BSC and future forecasts. The difficulties

    919
    in dealing with such a massive range of matters are immediately apparent.
    12.30 p.m.
    Let me explain what we mean by computer analysis. It is essential to make clear from the outset that we are looking at something which is not a vast exercise. The House and others outside are already undertaking such exercises and one of the concerns mirrored in the new clause is the feeling that the Department is not coming up with any clear assessment of the way that it views the work that the BSC is undertaking in this area.
    We are talking about a time-series of all published financial data including, for example, the previous 10 years' annual reports and accounts and, particularly, the use of the notes in those reports and accounts, which are often far more significant than the bald figures. From such computations it should also be possible to deduct quite quickly standard business ratios and any unconventional ratios, whether demanded by Ministers or hon. Members.
    It is important to emphasise that we are seeking access for hon. Members, through the Secretary of State, to the BSC's work in this area. It is appropriate that when hon. Members have access to the Treasury's macro-economic model, there should be an opportunity, through the Department of Industry, for hon. Members to switch in quite quickly to the key operating ratios of the BSC when we have a debate such as this.
    The sort of questions that hon. Members could readily put in such a study would quickly yield answers on, for example, the breakdown of salaries over a certain level. That is a significant figure, as I shall show later. It would also be possible, using a purely historical data base, to look at some simple mathematical extrapolations to try to find pointers for the future.
    The significance of this has been brought out time and again. Hon. Members will recall that year after year at around this time the Government propose further take-ups of borrowings well in excess of those that were previously anticipated. This is part of the monitoring that we would seek to do, not just when measures come before the House but through other opportunities when that computer data base was available.
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    We are not talking of a major systems task. The Select Committee on Nationalised Industries was able, through voluntary help from outside, to put together a data base on the last 10 years' reports and accounts in a matter of six weeks and, through one of the advisers, it was possible to use that data effectively within two weeks. It is worrying that there are those who would turn their face against the extension of computer usage not only for the Department but for the House. It was significant that in its recent study of nationalised industries, NEDO commissioned a paper on the finance of nationalised industries but that none of it was put on computer and is not available on a continuing basis to hon. Members.
    The situation in relation to steel is somewhat different because we have the advantage of the data base that the Select Committee made available through its findings. The figures in that study show the value that the House could obtain from the Department of Industry's assessment of the BSC's computer work. The Select Committee study of a 10-year pattern and projections based on historic basis with relatively simple assumptions, taking a fairly optimistic view, consistently gave the Committee the opportunity of seeing an accelerating worsening of the financial position, apparently long ahead of the Department of Industry. That is our immediate and fundamental worry and our reason for proposing New Clause 2. It was because of the Select Committee being alerted in this way, and feeling that its concern was not being shared by the Department, that we had the row earlier this year. We do not seek to rehash that row, but it showed, as I hope the Minister will agree, the value of establishing a data base.
    There is another indication of the way in which the data base can be used quite quickly and effectively. It has been demonstrated in the last few days by a former adviser to that Select Committee, Mr. James Taylor, who has been able to take advantage of help offered privately to put together an assessment and data base of recent reports and accounts and to make certain estimates for the future.
    The Minister of State will no doubt know about the findings reported in Mr. Taylor's article in The Observer on Sunday. I hope that the right hon.

    921
    Gentleman will comment on some of those findings, which are of great significance. I am sure that we all pay tribute to Mr. Taylor's enthusiasm and public spirit in making this information available to the House in time for debates such as this.
    The relevance of his recent studies is that he has not only repeated the Select Committee's exercise but has followed the pattern proposed in New Clause No. 2 by taking the last four years of the BSC's reports and accounts and projecting on a range of assumptions to give a 10-year picture. In many ways, his findings are disturbing and The Observer article is one that many hon. Members will wish to read and reread with special care in the light of experience over the coming months.
    We suggest three items in New Clause No. 2. It is not an exhaustive list, but they are items that seem, on the basis of Select Committee studies and Mr. Taylor's current studies, to raise matters of particular anxiety.
    Stocks have risen substantially during the last four years from £19·7 million in 1974 to a peak of £342 million in 1977. We do not have the latest report and accounts, but we see from the unaudited accounts up to March 1978—and we appreciate the Minister of State making these available to us—that stocks now stand at £143 million.
    It might be argued that this shows a welcome reduction of stocks. Obviously at a time of ever-increasing financial crisis for the Corporation, one of the immediate areas in which we would expect to see substantial reductions is the disposal of stocks—money that is tied up. The Corporation has been encouraged to have this money tied up in the past because of the counter-cyclical stocking schemes. The Government's schemes in this respect explain part of the significant rise in stocks, but that goes back to 1976 and it is hard to understand why stocks should still be 70 per cent. higher than they were four years ago—a time of more profitable trading.
    On wages and salaries, Mr. Taylor points out in his article that in the three years to March 1977, a period when pay controls were supposed to operate, the number of BSC employees earning more than £10,000 a year rose from 66 to 455,
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    while the average wage costs increased by 90 per cent. to more than£800 million.
    These are substantial increases during a period of wage restraint and massively increasing losses. What assurance can the Minister give that they do not include an element of rip-off—an element of saying "As long as we can go back to the taxpayer for more money, wage increases should press on, irrespective of the way in which our results are worsening"? It is an accepted fact that much of the cash intended for investment is being soaked up in operating costs and the largest part of this goes in wages and salaries. This has led to arguments, which the Government do not accept, about restrictions on the amounts that should be spent in capital expenditure. In thinking about how this figure should be kept updated through the Corporation's computers, it would be helpful to have some idea from the Minister how the figures, which we now know, can possibly be justified. We cannot update these figures to the latest date, because we do not have the latest report and accounts.
    On pension liabilities, there is yet another difficulty. We have not been able to get all the information that we sought. However, I express appreciation to the Minister of State for the information that he provided in response to a letter from me. In his reply of 12th June he gave more information about pension fund liabilities. But, in giving that information, he may be as much concerned as I am to recognise that the implications of the inability of which he spoke there to look at the matter on anything other than a triennial basis put us in real difficulty.
    Much of our concern in the new clause is to look at the off-balance-sheet liabilities. The main unknown is the pension fund liability. That arises, as is well recognised, from inflation-proofing. Of course, it could change dramatically if there is a change in the relationship between staff and manual schemes—a matter to which the hon. Member for Newcastle upon Tyne, East (Mr. Thomas), whom I am glad to see in his place, has paid particular attention.
    Therefore, I should like to ask the Minister of State three questions on pension liabilities. First, does the British Steel Corporation have a pension fund

    923
    valuation programme on computer? This is a simple and straightforward subject on which I hope he will be able to give us some information. I shall seek to write to him in more detail on some of these matters, because I accept that he will not be able to give detailed answers today. But the basic question, whether the British Steel Corporation has a pension fund valuation programme on cumputer at present, is one to which I hope he will be able to reply today. Given any kind of annual data, such as we have suggested, it should be possible in a matter of minutes to produce what we are now told is the subject of a three-year actuarial review.
    That brings me to my second question. If, as the Minister's letter of 12th June shows, the one year between March 1976 and March 1977 threw up an uncovered liability of £270 million, what is the effect of the rise in unemployment costs from £897 million to £1,075 million in the period 1975–76 to 1977–78? Surely the Minister must agree that, with figures of that kind, a triennial valuation is an archaic actuarial practice in a period of rapid inflation when increases are likely to be in hundreds of millions of pounds.
    Thirdly, what would he the uncovered liability in upgrading from the manual scheme to equal the staff superannuation scheme? It seems clear that it is bound to come. Surely it means that on present estimates there would be an increase in total liability to the pension fund of 20 per cent. with a far higher increase in uncovered liability.
    Those are three important areas where the data base and the computer analysis would allow the Secretary of State, and thus the House, to monitor past history and current prospects for the BSC.
    We must also consider the other information which is called for in New Clauses Nos. 3 and 4. New Clause No. 3 simply seeks to ensure that "Prospects for Steel," which was made available to the House as background for Second Reading, is made available annually on an updated basis. It would also provide Ministers with the opportunity, which I hope they will take today, to return to their undertakings given in Committee.
    We need to be clear that there is agreement on the general principle that
    924
    "Prospects for Steel" would be a valuable adjunct to the report and accounts and/or to be used at the time of any annual take-up of borrowings. The Opposition are flexible about the date when the publication should be issued, but that it should be updated and published annually seems to us to be of the highest importance.
    In Committee, we touched on the question of the way in which "Prospects for Steel" could be beefed up. But our main worry was the speed with which many of the assumptions which it included were being invalidated. For example, there are widely shared worries now about the difficulty of getting agreement on a European pricing scheme for steel, there are suggestions that the BSC may find substantial claims made upon it for anti-dumping in the United States and there are the effects of the strike at Llanwern, to which my hon. Friend the Member for Kingston upon Thames (Mr. Lamont) drew graphic and detailed attention. All these matters must have an immediate effect on many of the assumptions in "Prospects for Steel."
    There was also the question of other additional information. In Committee, the hon. Member for Merioneth (Mr. Thomas) sought to gain additional information about the activities of British Steel Corporation Industry Ltd.—an activity to which my hon. Friend the Member for Kingston upon Thames referred.
    On top of the other matters which have been raised, I suggest that the sale of redundant plant or joint ventures would be fitting subjects to incorporate in "Prospects for Steel". That document will inevitably allow the Corporation a greater area of editorial assessment of its general situation as opposed to the perhaps stricter legal and accountancy requirements of its report and accounts.
    In New Clause No. 2 we seek assurances from the Secretary of State. In New Clause No. 4 we are beginning to look more at what the Corporation can do to reassure the House, though the Secretary of State, on two major areas.
    The first is the question of updating the figures for maintaining uneconomic plant. I recall that the Under-Secretary of State gave an assurance that he would give a figure. I appreciate that, through his

    925
    right hon. Friend, he has made information available to me showing that the current figure for maintaining uneconomic plant stands at£111 million compared with £65 million, which was the last published figure by the BSC.
    This is not an idle, esoteric exercise. It is important to remember that the cost of maintaining uneconomic plant—generally regarded as Beswick plant—has had a direct impact on the Corporation's profitability. If those of us who are from time to time critical of the Corporation or the Department wish to strike a balance, it is essential that we point to the cost imposed on the Corporation by the Government's decisions on the Beswick plant. But the question now is beginning to go even wider. The fear that many of us have—this is where the point of New Clause No. 4 will be immediately apparent—is that what is perhaps economic plant is becoming uneconomic plant over a wider canvas.
    To the extent that investment programmes are now being curtailed, one of our fears is that we shall find added to the uneconomic plant list a number of the major projects which we had previously anticipated as having a reasonable pay back. Therefore, I hope that the Government will concede the principle of New Clause No. 4 and will seek to use it in a flexible way to list such plant as is running into financial difficulty.
    That brings me back to the now long debated question of post-completion projects appraisals. We have had considerable debate about this matter from time to time. Again, I express appreciation to the Minister of State for sending me a letter yesterday which outlines a number of the factors which are taken into account in post-project appraisals, particularly in the light of experience gained during the last two years.
    Before dealing with that matter, I should like to refer briefly to column 83 of the proceedings in Committee. The Minister of State gave three examples of the kind of post-appraisal reviews which the Department was undertaking with the Corporation. He mentioned, first, the preparation of raw material; secondly, steel making; and, thirdly, product finishing. The right hon. gentleman did not spell out which those projects were. I
    926
    understand part of his reticence. However, I think that he is a little oversensitive in these matters.
    For example, the preparation of raw materials must clearly refer to Redcar. When hon. Members have had the opportunity of visiting Redcar, they have frequently been told that what is happening there is fully in line with anything that is going on in the world, including Japan. Therefore, that must be one of the successful projects to which the Minister of State referred. We would like to hear about some of the successes as well as the problems.
    In Committee, the Minister sought to draw a range of findings within his Department in which performance ranged
    "between an outcome which was very satisfactory and one which showed that considerable improvement could be made."—[Official Report, Standing Committee B, 13th June 1978; c. 83.]
    It is on this question of where improvements can be made that the House necessarily feels that it must show a particular interest. Here I refer to the letter of 22nd June in which the Minister of State said:
    "during the past two years increasing emphasis has been put on … Personal commitment".
    That makes sense. To many of us who try to follow these matters there has been a feeling of uncertain personal responsibility over a range of products. The Minister goes on to list a number of main areas in which personal commitment would apply. He refers to increased delegation of authority on project approvals, and projects of up to £2 million, which are now authorised within divisions within specific annual limits. He refers also to personal responsibility of a nominated individual for each project, to consultation with the unions on manning levels and work practices, and to consultations with contractors on the improvement of on-site performances. He expands that list with two short final points and speaks of budgetary control' procedures which have been improved, mainly on the internal rationing of cash allocations to projects and of further development of control systems and procedures.
    We are grateful for that information, but it is very general and we cannot leave the subject without reminding the Minister of what we seek in New Clause

    927
    No. 4. It has been sought on many occasions. It is some greater feel—and we do not want to put more strongly than that—some balancing of the factors as between inflation, escalation clauses, and scope changes, by which we mean the way in which changes are decided as between the BSC as the customer and the plant manufacturers as suppliers. There is evidence of where the Corporation has from time to time changed its mind at cost to itself and, in effect to the taxpayer. The House should know much more of such matters.
    I give one example. Owing to scope changes at Hunterston, special sealed wagons were found at a late stage to be necessary and the cost of the project was increased. We seek to delineate that part of the increases in capital costs in projects which arises from industrial disputes and delays because of labour shortage, and we seek to find out which part of those increases arises from Government action, as we have argued earlier.
    In the broader area, too, it would be foolish to suppose that this House or the country could remain unaware of the evidence which arises in the Press and other channels about failures in design and engineering and about failures in project control. There is also, and perhaps this is more critical now, the way in which some projects, having been put torward and committed at low capital cost, become a continuing drain when there are changes in Government policy. Redcar is a good example of where there appears to be a turning back after the expenditure of some £500 million. Further examples are the way in which Ravenscraig has risen in cost between 1972 and this year from £28 million to £243 million. For Scunthorpe, the 1971 estimate of £180 million has now risen to between £500 million and £600 million. At Lackenby the £20 million development on pollution control, to which the Minister of State referred, had to be rebuilt because of a design failure, at a cost of £60 million, in 1977–78. And so one could go on.
    The problem that arises in discussing all these examples is simply that they throw very grave doubts on many of the assumptions and conclusions which the Secretary of State put to us in introducing the Bill and which the
    928
    Minister of State tended to argue through Committee. Without assurances and agreements to improve reporting systems as outlined in the clauses we have to say that capital budgets and profitability calculations are not credible. The cash flow budget itself becomes doubtful and, as we know from past experience of the BSC's impact on the public sector borrowing requirement, the Treasury's estimate of that figure is not reliable.
    Finally, and this is the point which I am sure will ring a bell in the hearts of all hon. Members, Parliament has no way of controlling or even forecasting the cash outflow and commitments covered by measures such as this unless we can have some assurance and unless there can be a greater reliance on the intelligence of hon. Members in discussing this wide range of factors. It is for these reasons that we seek to persuade the Government that the adoption of these new clauses would greatly help that cause.
    Mr. Kaufman: I wish the hon. Member for Arundel (Mr. Marshall) many happy returns of the day before yesterday. I always have particular reason to know when his birthday comes round.
    The hon. Gentleman has asked me a number of detailed questions. He has sometimes in the past made a practice of writing to me in advance when he has such questions to put. On those occasions I am able to prepare myself adequately to deal with them. On this occasion, if the hon. Gentleman is agreeable, I would much prefer to write to him on the detailed questions rather than seek simply to give him answers on the basis of hurriedly scribbled notes which, apart from anything else, might not be accurately read. I hope that he will agree to that.
    I have a comment on one of his points which I make not in any way to denigrate the way in which he approached it, but to show the problem that can arise in trying to deal with these matters. The hon. Gentleman quoted an article from this week's edition of The Observer. He dealt in the serious manner that we would expect of him with some of the matters raised in that article, including the question about wages and pay. But if he refers to the article he will find that the author,

    929
    writing about the problem of the rise in salaries and so on, refers to
    "the last three years to March 1977, during which pay controls were supposed to be in operation".
    That is not the situation. The Government's revised pay policy did not begin until July 1975. There was a period from March 1974 until July 1975 when no formal ceilings were in operation. One must therefore take into account that this was a situation in which, for nearly half the period, there was not the kind of pay policy that now exists.
    The House is well aware that since July 1975 when the Government introduced the policy in the White Paperv "The Attack on Inflation" the Corporation has observed all of the Government's pay guidance. But the period referred to in the article includes the time when there was no quantified Government guidance on the appropriate level of wages settlements and when wage costs in industry rose substantially.
    When the hon. Gentleman asks for information, as he always does—and I do not in any way complain about it—I always do my best to respond. We gave commitments in Committee, all of which either my hon. Friend or I have fulfilled, including an approach I made to the chairman of the Corporation to provide information supplementary to "Prospects for Steel", and that was the burden of one of the letters I wrote to the hon. Gentleman.
    Without needing to write anything into the Act—and in some ways it would be inappropriate to do so—I give the hon. Gentleman the assurance that I shall do my best to go on providing a regular flow of information. I very much take the point implicit in his remarks that the information should not need to be assembled only when legislation or a Statutory Instrument is going through the House, and that some kind of more periodic arrangement might be of assistance.
    1.0 p.m.
    Obviously, in the light of the hon. Member's latest proposal, I should like to discuss that with the Corporation. But there has been a very wide welcome for "Prospects for Steel". When a book gets such good reviews, the author often likes
    930
    to bring out supplementary editions. Let us see how we get on with that. I shall do my best to supply any information that I can.
    I should like to come to the three new clauses specifically. As regards New Clause No. 2, the Iron and Steel Act 1975 already provides, as the hon. Gentleman will know, for the Secretary of State to obtain from the Corporation such returns, accounts and other information with respect to its property and activities and the property and activities of the publicly-owned companies, as he may from time to time require. The proposed new clause would therefore duplicate existing powers.
    Officials of my Department already analyse BSC's management accounts and a computer analysis of BSC's annual reports and accounts for the last five years would not provide a basis for any worthwhile study because they are too general.
    As regards New Clause No. 3—we have already discussed this matter both this year and last year; this year, much better than last year, as I think is agreed—the Corporation has responded to the needs of Parliament by providing a prospectus on the Corporation's activities, together with its consolidated accounts in a provisional and unaudited form. I know that that is not as good as the final accounts, but the hon. Gentleman has been good enough to acknowledge that we have done our best to supply this information. I explained in Committee why no cash flow forecast was included, and I have written to hon. Members updating the existing information on the financial controls.
    I repeat emphatically that both the Corporation and the Department of Industry are anxious to meet Parliament's proper needs for information. While I am always ready to act as a channel between the hon. Gentleman and the Corporation, if there are any other specific points that he or other hon. Members would like to raise I suggest that they should take up the invitation of the chairman of the Corporation to interested Members to discuss the annual accounts with him and his colleagues on 4th July.
    In the light of the Corporation's voluntary provision of detailed information both this year and last, I hope that the hon. Member will agree that it is

    931
    unnecessary to place a statutory obligation on it to provide such information in the future. Also, when market conditions become more stable, it will be unnecessary to repeat all the detail given in "Prospects for Steel", since major changes will be infrequent. However, I shall put to the Corporation the hon. Gentleman's suggestion that a more regular and perhaps annual edition of "Prospects for Steel" might be useful.
    Mr. Mike Thomas: Did I understand my right hon. Friend to say that in considering the proposal for regularly publishing "Prospects for Steel"—which is a very useful publication—he was considering that future publications should not contain the amount of detail that "Prospects for Steel" contains? I think that many hon. Members would wish that such future publications did contain it.
    Mr. Kaufman: I should not like to be categorical about that. I am very much in favour of providing the maximum amount of information. What I was trying to imply—I know that my hon. Friend will accept this—was that as conditions change it may not be necessary for "Prospects for Steel", if it is to be published in the future, to take precisely the same pattern as the current edition. However, I always welcome more information rather than less.
    Mr. Mike Thomas: I am sorry to interrupt my right hon. Friend again. Will he confirm that he is aware that two matters are important to hon. Members? The first is that there should be the possibility for the House to judge performance against promise. There is always the temptation on the part of any nationalised industry, when asking for investment money or whatever, to accentuate the positive. That must be discouraged. Secondly, some idea of the assumptions on which the projections are being made should be made clear as well as just the end of the mathematical process. This is extremely important.
    Mr. Kaufman: I know the importance that my hon. Friend attaches to that. Apart from anything else, it is very important to make sure that performance is constantly watched. I have been in touch with the chairman of the Corporation and he tells me that the latest
    932
    situation of which he is able to tell me is that the Corporation's results for the first two months of the current financial year show some improvement on the annual operating plan projections.
    As hon. Members know, it is very difficult to be certain about the way in which the international steel market will move. That makes it extremely hazardous to give any firm indication of what the out-turn for the year would be.
    However, with that proviso, it would appear that the Corporation is at present on a course which will at least hold the AOP projection which, in its publication "Prospects for Steel", the Corporation indicated would be a loss of about £400 million, including its usual contingency provision.
    The annual accounts for 1977–78 will be published on 4th July. The chairman will then give some indication of the likely result of the first half of the current year. As I have said, I understand that it is the chairman's intention to invite interested Members on that day to discuss the annual accounts with him and his senior colleagues.
    My hon. Friend spoke about the importance of measuring performance as against promise. We have made it clear to Sir Charles Villiers that we regard it as a matter of prime importance that the Corporation should make every effort to improve on performance levels provided for in this year's AOP. I had better add, so that the House is aware of the gravity of the situation, if it was not aware of it before, that when I further questioned Sir Charles about this matter yesterday, what he said—I quote his words precisely—was:
    "Nothing has got better and one or two assumptions connected with the market look to have got worse."
    So I think that I had better put that on record. I am grateful to my hon. Friend for enabling me, through one of his well-judged interventions, to do that.
    I come now to New Clause No. 4. My Department does not carry out post-completion project appraisals although, as has been explained elsewhere, from time to time it studies the project appraisals carried out by BSC. Naming the appraisals carried out and providing individual details of loss-making plant would, I feel, lead us into the discussion

    933
    of issues which are properly the sphere of BSC's management.
    As I explained in Committee, my Department has discussed three appraisal reviews with officials covering three particular aspects of BSC's activities. Hon. Members will be aware that the Corporation has been very successful in bringing projects into commission on or before time. The Scunthorpe rod mill was built to programme, and Thrybergh bar mill, which aimed to achieve a production figure of 8,000 tonnes a week after 100 weeks, achieved this result in its 46th week. The projects studied by my Department covered performance ranging from "satisfactory" to "showing scope for considerable improvement". Instances emerged of under cost estimating, design problems leading to plant not performing to intentions and major changes in a project's scope. The Corporation is constantly trying to improve its procedures to reduce the possibility of recurrence of these problems. Hon. Members might also like to know that all cost overruns come up for reauthorisation, and where the scope of a project is changed the project is re-evaluated.
    Although in the past scope changes have caused project costs to increase over original budgets, improved planning processes have largely eliminated this sort of increase.
    I have sought to deal in some detail with the substance of the new clauses. I have noted very carefully the points that have been made. I know that the hon. Member has not himself felt, on this or any other proposals that he and his colleagues have framed with great skill and ingenuity in order to allow us to have debates, that he wanted to insert them into the Bill. We shall consider where it is possible to assist. Where it is possible and appropriate, we shall do so. I hope that the hon. Member will not feel it necessary to press the new clauses.
    Mr. Michael Marshall: By leave of the House, in order to make progress, since the Minister has said that he will write to hon. Members on these matters, it might be helpful to put to him two or three other short points which arose from his speech and which might have come up if we had debated Third Reading.
    934
    The basic question is the problem of the Corporation as it stands today. The Minister quoted the work of Mr. Taylor, of which I do not defend chapter and verse. However, the burden of Mr. Taylor's argument was that the Government's suggestion of a future financial reconstruction meant, first of all, that dividends on £1·5 billion would be payable only after a financial reconstruction which had no terminal date and which apparently had no sanctions in the event of failure to reach an agreed date. In other words, all that the Bill offers at present is a return on the £1·5 billion on the never-never.
    Secondly, financial reconstruction—I hope that the right hon. Gentleman will be able to assure us about this, if necessary through correspondence—clearly means that the debt will be written off. At present, that means that the money which the taxpayer is asked to provide under the Bill is to be advanced with the declared intention of not paying it back.
    If we simply ask for the overall financial situation, we must remind ourselves how, year after year, in June or July, we find that forecasts are well adrift. Mr. Taylor's point was that two years ago the chairman of the BSC forecast that the House would not be required to increase borrowings until 1979–80. Yet, despite a vastly reduced capital expenditure programme, there is a shortfall in internally generated funds—that is, cutbacks in excess of £1,200 million—of about £400 million. In other words, that is a net failure of estimates of £1,600 million in two years. That is an alarming figure. It is one that the Minister has argued in the past is related to changes in the market, but I fear that that is not an argument that he has been able to sustain in our debates on the new clauses.
    I hope that the Minister and his hon. Friend will turn their attention to the real implications of the BSC's own flexibility as a monopoly which should be able to thrive better than its competitors in a declining market. It should be able, above all, to see some restoration in the severe loss of its domestic market, particularly from British Leyland and Ford, which take half their steel requirements from the BSC and would probably take 80 to 90 per cent. if it were available at the right quality and at the right price.

    935
    On our worries about internal managerial and project controls, we have raised a number of points which the Minister has said he will consider further and which are the summation of three years' pressing for information. Little by little the Select Committee and through the Minister of State and his hon. Friend we have received some additional information. I pay my tribute to those who have made that information possible. I recognise the load which has fallen on the Minister's officials in helping him to give his replies to the House.
    The matter is grave and urgent. Three years ago, the Minister told us that he thought that the good times were just around the corner. He has had a difficult ride on the question whether he misled the House. I take the view that perhaps he misled himself. There were some difficulties a year ago. The assessment that we then made was particularly difficult, but the difficulty was based partly on the failure of internal communications. This time we are asked to wait and see. We are willing to do so, but we shall watch with ever-increasing vigilance.
    Question put and negatived.
    Bill read the Third time and passed.

EUROPEAN COMMUNITY (FOUNDATION AND CULTURAL SECTOR)
1.14 p.m.
The Under-Secretary of State for Foreign and Commonwealth Affairs (Mr. John Tomlinson): I beg to move,
That this House takes note of EEC Documents Nos. COM(77)600, R/325/78, R/734/78, R/774/78 and R/2982/77 on the European Foundation and Cultural Sector.
Today, we debate five documents covering two subjects—the European Community action in the cultural sector. At its meeting on 26th April, the House of Commons Scrutiny Committee recommended a debate on the five documents since they raised questions of legal and political importance. It is also a fact that Early-Day Motion No. 108 on the European Foundation demonstrated the views of hon. Members when it attracted 320 signatures.
Mr. Nigel Spearing: Will the Minister give way?
Mr. Deputy Speaker (Sir Myer Galpern): Order. The Minister has said only a few words and already an hon. Member wants to intervene.
Mr. Spearing: I was hoping to save the time of the House at a later stage, Mr. Deputy Speaker.
Mr. Deputy Speaker: Oh, good.
Mr. Spearing: In respect of that Early-Day Motion, is my hon. Friend satisfied that its terms accurately reflect the central objectives of this Foundation?
Mr. Tomlinson: That is rather premature, as the Foundation has no objectives at all—
Mr. Spearing: Oh.
Mr. Tomlinson: There might be proposals of objective, but as there are no objectives for the European Foundation yet, it would be premature to speculate on them.
Mr. Spearing: Then we should not have signed it, should we?
Mr. Tomlinson: We have not signed anything in relation to a European Foundation. Perhaps it will be more appropriate to develop the argument and

937
to listen to my hon. Friend later. Otherwise, this will clash with something that I intend to say later.
I propose to deal first with the background of the present stage of discussions reached on the Foundation. I shall then turn to the developments leading up to the production of the Commission's communication on action in the cultural sector, concluding with some remarks about certain aspects of the cultural sector proposals which are of more direct concern to the Foreign and Commonwealth Office, leaving the Minister of State, Department of Education and Science, to comment more fully on the Foundation and other aspects of the cultural sector document.
The first four documents, which set out the background to the Foundation, are amplified by the Explanatory Memorandum of 3rd March 1978 and the Updating Memoranda of 3rd April and 12th June, submitted by the Secretary of State for Education and Science, copies of which have been made available.
The Government are committed only to the principle of establishing a European Foundation. And to the fact that it will be in Paris. We are committed to no more than that. The scope of the Foundation's activities and its structure are still very much matters for discussion and the purpose of today's debate is to give hon. Members a chance to let us hear their views.
In the discussions in Brussels among officials, we have made plain our wish to have a Foundation which is modest in size, with strictly defined objectives, whose finances are subject to the maximum control by member States—that is to say, that Community expenditure should be obligatory.
Mr. Spearing: This is most important. My hon. Friend has just said that the Foundation has strictly defined objectives. I think that Hansard will show that earlier he told me that it had no objectives yet. Can he clarify that?
Mr. Tomlinson: My hon. Friend is having a problem of tense. I said that at present the Foundation has no objectives. What I have just been trying to point out is what our objectives are. At present, we are committed to nothing more than that there shall be a European
938
Foundation and that it shall be in Paris. That is the limit of our commitment. What I am saying is that, in the discussions, those are our objectives—modesty of size, strict definition of purpose and maximum control by member States. I was going on to say that by that I mean that the Community expenditure should be obligatory.
We shall insist on adequate provision for audit to ensure not only that moneys spent are fully accounted for but that the expenditure has been directed entirely to the limited range of agreed programmes and activities.
We are also concerned to ensure that the Foundation should be organised so as to avoid duplication with other institutions working in the same area, and oriented so as to co-operate effectively with those institutions. The proposals for Community action in the cultural sector do not spring from any new or recent thinking. Such ideas were in evidence well before British accession to the European Communities.
In April this year the Commission Communication was submitted to the House under an Explanatory Memorandum jointly presented by the Department of Education and Science and the Foreign and Commonwealth Office. Under the normal procedures the Communication has been referred from the Council of Ministers to the Assembly and to the Economic and Social Committee. As yet we do not have the opinion of either of these bodies. Officials here have examined the Commission's proposals and on 7th June gave evidence before a Committee of the other place. The evidence taken has not yet been made available but I would like, against that background, to make the Government's position clear.
The Community enjoys no automatic competence in the cultural sector under the provisions of the Treaty of Rome. It would not be in the interests of member States to seek to establish any such united policy. The set of proposals covers a wide range of subjects straddling the areas of responsibility of several Government Departments. Most of the ideas in Part I of the Communication attempt to add a cultural dimension to possible areas of action being considered in other forms, for example, freedom of trade, mobility

939
of labour, rights of establishment, taxation and so on. These proposals have to be viewed on their individual merits and in many instances we are not convinced that there is much that is feasible.
Certain items in Part II are already in operation, such as scholarships, assistance to the Nuclear Research Institute at Grenoble for research into methods of conserving items of cultural importance, help for museums and so on. Other topics are so vaguely formulated that they hardly represent proposals. However, the general thrust represents a response to a feeling of need for enhanced co-ordination of activities in the cultural area on a pragmatic basis.
In principle the Government would be ready to discuss with their Community partners specific proposals as the occasion arises and in other institutional frameworks, such as the Council of Europe and UNESCO. It is not the Government's intention to accept the totality of these proposals, which we believe are varied in their degree of merit. In particular, the Government would strongly resist any attempt to impose yet another level of bureaucracy in an area in which the Community does not already enjoy competence.
Having said that, I draw attention to the draft resolution at the end of Document R/2987/77. This resolution essentially poses to member States Governments, including Her Majesty's Government, the question whether these proposals are desired. I hope that this debate will help to clarify the view of the House on this issue.
I understand that some of my right hon. and hon. Friends see in these proposals the threat of creeping federalism. I re-emphasise to them that neither the Government nor, I believe, the official Opposition—and certainly not the Labour Party or me—espouse the cause of federalism. I am as opposed to the concept of federalism as many of my right hon. and hon. Friends who have regularly expressed their fears in this House. I stress to them what the Prime Minister said in his letter to Mr. Ron Hayward, General Secretary of the Labour Party. He said quite clearly:
"The Government has never accepted that the Community should develop into a federation. It is our policy to continue to uphold the rights of national Governments and Parlia-
940
ments. We do not envisage any significant increase in the powers of the European Parliament."
My right hon. Friend went on to utter the words which my hon. Friends will know as well as I do in relation to the powers of the European Assembly.
What was said in the context of the Assembly applies even more widely to the general principle of federalism in Europe. I hope that my right hon. and hon. Friends will be reassured that the Government will take as staunch a view in the future in opposing anything that we consider to be a move towards federalism as we have done in the past.
There are five documents involved. There has not yet been any decision reached in relation to the European Foundation other than that, as I explained, we support the creation of a European Foundation and accept that it should be located in Paris.
Mr. John Lee: What some of us would like to know is whether this Foundation is to be the vehicle for pro-Market propaganda, something which may be of considerable importance in the year when there may be what some people like to call Euro-elections.
Mr. Tomlinson: I can readily assure my hon. Friend that we have no intention of allowing that to happen. I do not think that the risk is real, but what I have said about the strict definition of objectives, the modesty of the fund and the operation of the audit—all of which we shall want to see as an integral part of the Foundation—shows that there is no possibility of such fears being realised.
We have expressed our agreement in principle to the establishment of the Foundation and put forward our scepticism about the need to extend Community competence.
1.27 p.m.
Mr. Geoffrey Rippon: I would not wish to follow the Minister into any discussion of federalism or the internal correspondence of the Labour Party. My view is that we must create European unity step by step and with realism. The proposal for the European Foundation is such a sensible and realistic step.
I begin by congratulating the Government on their success so far in carrying

941
out the wishes of the House with regard to the establishment of the European Foundation on the lines now proposed. This is a good example of what the House can achieve if it takes the initiative and seeks to create policies rather than merely react to them. Until this House expressed its view the Tindemans proposals had been quietly laid on one side. The House will recall that in February 1977 324 hon. Members—an absolute majority—drawn from all parts of the House signed the Early-Day Motion tabled in my name and in the names of right hon. and hon. Members representing all political parties.
That motion urged the Government:
"to take the initiative in the Council of Ministers of the European Community with a view to marking the 20th anniversary on 25th March of the signing of the Treaty of Rome by launching a European Foundation on the lines recommended in Mr. Tindemans' Report, to be financed partly by grants from the member States and partly from private funds, with the aim of promoting, either directly or by assisting other bodies, any measures which will help towards greater understanding of European aims but placing the emphasis on human contact such as youth activities, university exchanges and town twinnings."
In the event the European Council, on the initiative of the United Kingdom—because we were in the Chair at the time—in Rome on 26th March 1977 took the necessary first steps by asking the Commission to draw up a report for presentation at its December meeting. This was done in the way the documents before us explain.
The decision in principle having been duly taken last December, we have now reached the stage where in Copenhagen, on 7th and 8th April, the Heads of State and of Government laid down, as they said in their communiqué, the scope of the objectives of the Foundation and agreed on the framework for the structure and the financing. They decided that the seat of the Foundation should be, I suggest suitably, in Paris. There is a broad framework and there is agreement between the Heads of Government on the scope of the objectives and on the framework for the structure and the financing.
All that now remains is to conclude the formal discussion, in the words of the Copenhagen communiqué, "as soon as possible". I trust that that will be done within a few weeks. I am glad
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that the emphasis has been placed, in dealing with the scope and objectives of the Foundation, on ensuring that the activities will be complementary to those of existing organisations. It will act as a catalyst with the aim of buttressing but in no way supplanting efforts which are already going on.
Specific reference has been made, rightly, to the need to collaborate with the European Cultural Foundation in Amsterdam and with the Council of Europe. That Foundation is an international non-governmental organisation, which devotes most of its income to the promotion of cultural, scientific and educational activities. It already has an agreement with the Council of Europe which ensures excellent relations.
The sort of other existing organisation which might look to the Foundation for assistance include, for example, the Council of European Municipalities and the International Union of Local Authorities, which are much concerned with town-twinning and youth exchanges. Another example which would deserve assistance is Europa Nostra, which is concerned with the protection of our European architectural heritage, or the European Youth Orchestra, or the European Choir. These and similar bodies, as I see it, will continue to be completely independent and responsible for formulating their own programmes. Where appropriate, they will all receive additional support and finance from the new Foundation.
It should be made clear that existing independent organisations will still need to raise funds from private sources. I think that that is essential, since the Foundation will only rarely, I understand, engage in direct activities and will be mostly concerned with helping those who help themselves. So, as the Minister said, the Foundation will not need to have any elaborate structure or incur any large administrative cost.
The prime objective is to expand the scale of voluntary work, particularly in cultural and educational exchanges, all of which are at present gravely restricted by lack of sufficient funds. I hope that the financing of the Foundation will be agreed without delay. The basic proposals have already been formulated. What is required is an initial endowment and annual contributions which can be financed partly from Government funds

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—that is right, since it should be an intergovernmental rather than a Community organisation—and partly from a contribution in any event from the Community budget. That can be supplemented by private sources, particularly if we can ensure that those who contribute to the Foundation will have the tax advantages that normally apply in member States.
Mr. Tom Litterick: I was interested to hear the right hon. and learned Gentleman's remark to the effect that the voluntary bodies would remain independent. He went on to say that those bodies are already severely handicapped by lack of funds. Can he tell us how these bodies will be more benefited by getting the British taxpayer's money through a European body than they would by getting it directly?
Mr. Rippon: I have no objection to their getting both. When I was a Minister at the Foreign Office, I played some part in establishing funds to support our British organisation. I thought that that was a good thing. It may well be that it could be revived. But since most of these organisations are on a European basis and produce European programmes, it seems appropriate that they would be financed through a European Foundation. What needs to be supplied is the precise amount of initial endowment and the scale of the assured annual income.
Whatever formula is agreed, I would have thought that the total amounts involved are hardly likely to be a matter of great concern to the Treasuries of the nine member States. The suggested contribution from the Community budget of five million units of account in the first year, 10 million in the second year and about 20 million thereafter does not seem to me to be excessive.
Whatever differing views there may be in this House about the economic issues that arise from time to time in relation to our membership of the EEC, I hope that we have—indeed, the Early-Day Motion suggests that we have—a very wide measure of agreement on the desirability of bringing the peoples of Europe closer together and creating a wider knowledge and understanding of our European civilisation and heritage. That is why I think it important that the Heads
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of Government have envisaged that although this should be financed by the nine member nations, its activities will not in any way be restricted and there will be possibilities of ensuring the greatest measure of co-operation with the Council of Europe and its member States.
Of course, there may he more room for controversy about some of the detailed recommendations in the Commission's proposals as set out in Document R/2982/77, such as the harmonisation of value added tax on works of art. While it may be convenient for that document to be debated together with the subject of the European Foundation, the proposals in it are quite separate and distinct. They raise a whole number of separate issues, and it would be a pity if we confused the two matters. They carry no legislative effect, and the draft resolution to which the Minister referred, which in any event is not binding on member States, is in very general terms.
As the Select Committee points out, some of the measures proposed are already covered by existing Community legislation. Some, such as, for example, the recommendation to all member States to ratify the Council of Europe's Convention on the Protection of the Architectural Heritage, we have already implemented—in that case as long ago as 1972. As for the rest, where they require legislation or involve additional expenditure, they will all go before the European Parliament and other institutions, and in due course before the Select Committee in the usual way, and they can be considered on their individual merits which, I am inclined to agree, vary from case to case.
What I think should be welcomed in relation to this document, as in relation to the proposals for the European Foundation, is that this is further evidence that the Commission and the Council of Ministers are fully seized of the importance and the relevance of stronger action to preserve our European architectural and cultural heritage and to develop cultural, educational and other human contacts on a much broader basis than we have hitherto been able to achieve.
1.38 p.m.
Mr. John Roper: This debate, as the right hon. and learned

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Member for Hexham (Mr. Rippon) has said, covers two matters which are somewhat distinct. While, unlike some of my hon. Friends, I welcome the proposal for a European Cultural Foundation—and one congratulates the right hon. and learned Gentleman on his initiative there—I have many more reservations on the development on the cultural sector.
In that respect I should declare an interest as vice-chairman of the Committee on Culture and Education of the Consultative Assembly of the Council of Europe. I have perhaps an interest particularly if it is thought that this document is in any way a threat to the valuable work undertaken over a number of years within the Council of Europe and, in particular, within the Council on Cultural Co-operation, which goes wider than the 20 countries of the Council of Europe and also involves Finland and the Holy See, and has been meeting in Strasbourg this week.
Before coming to the role of the Council of Europe, I should say something on the proposal for the Foundation. Even with the most recent additional memorandum from my right hon. Friend the Secretary of State for Education and Science, I am still a little confused as to whether this will be a Community institution or another governmental body. It seems to be something of a hybrid. Perhaps my hon. Friend the Minister of State, Department of Education and Science can say a little more about its status.
I hope that Annex II to the most recent proposals that went to the Council, referring to the Council of Europe, will be applied. When we are considering the cultural dimensions of Europe it is important to see Europe on as wide a basis as possible. The countries of the Nine, as they are now, and the Twelve, as they may well become, represent the majority of the population of Europe, but we must remember that valuable contributions to our common culture are developing in countries outside the Nine, and indeed outside the Twelve.
One has only to think, for example, of the tiny country of Iceland, which preserves within its culture one of the important sources of the whole of European culture. I could give examples of many other countries which are not, and
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do not intend to become, members of the European Community and which should be involved in this work.
I was reassured by many of the remarks made by my hon. Friend the Minister about the document on the cultural sector. However, I must admit that it is not the threat of creeping federalism that makes me uneasy. Indeed, if someone could put forward some sensible policies for federalism, which has not been done yet, I should be prepared to consider them on their merits. What I am concerned about is creeping bureaucracy. This document could represent a risk of creeping bureaucracy in Brussels and duplication of bureaucracy there on matters which can be done already. I hope to examine and outline why that is so.
It seems to me that cultural policies are inherently national, or perhaps not even national. Within the United Kingdom we rightly allow cultural policy to be dealt with as appropriate in different parts of the country, because of the different cultures which co-exist within one united kingdom. Certainly at one level it is a problem for national or sub-national policies within member States, but it must also be considered at the widest possible European level.
I am therefore somewhat sceptical about the view adumbrated in the document that the level of the Nine is an appropriate level at which to co-ordinate and develop cultural policy. The level of the individual country and, as appropriate, the level of the Council of Europe, representing as widely as possible the cultural interests of Western Europe as a whole, seem to me very sensible levels for discussions and consideration. But I am not persuaded that the level of the Nine is appropriate on a number of the matters covered in the document.
As my hon. Friend the Minister said, the first part of the document really applies what one might describe as the economic aspect of the Treaty of Rome to the cultural field, where the Nine have a role. When we consider freedom of trade, we are clearly operating within the economic community and the cultural dimension of that community is an appropriate area for community action.
Similarly, it is sensible to consider the freedom of trade in cultural goods or of

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movement and establishment of those who work in cultural industries, in the same way as we view the freedom of movement of doctors, dentists or anyone else, at a Community level. That possibly also applies to questions of harmonisation of taxation and legislation in the cultural sector, although I am not persuaded that it is necessarily a good idea for us automatically to adopt the scheme of public lending rights which commends itself to the Federal Republic of Germany. It seems to me that even within these areas of cultural legislation the Community has not reached a state in which it is by any means necessarily desirable to have the same forms of legislation on matters such as public lending rights throughout the Community. That is so paticularly as, given the differences in languages, there is not a great deal of borrowing of French, German or Italian books from British public libraries and vice versa. Therefore, that aspect will require a great deal of further attention.
But it is really with the second part of the document that I concern myself. We must begin by looking at the curious resolution at the end of Document R /2982/77, in Annex II. I refer to the last three clauses. If ever there were a blank cheque that the Council was asked to endorse, this is it. The first paragraph of the resolution says:
"Community action in the cultural sector shall he implemented on the basis of the guidelines laid down in the Commission Communication."
If the Council adopts that resolution, it is buying the whole document—I shall later point out some of the interesting matters it contains—hook, line and sinker. It is an extraordinary resolution, which I trust British Ministers will examine carefully and resist. No hon. Member would support acceptance of the document hook, line and sinker.
I turn to the individual proposals. I should perhaps begin by saying that the document is written in a lyrical style which does not always come out of Government communications, and particularly Community communications. That is one aspect of it which is rather welcome. My hon. Friend the Member for Putney (Mr. Jenkins) will no doubt have read the section on museums, which compares them with icebergs and refers to the "dusty jumbles of yesteryear". That
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displays a tine style, but not necessarily one that we should want to have in a document to constitute the guidelines for the future of the Community's policy. Nevertheless, I am pleased to know that lurking somewhere in the Berlaymont is a man with a romantic imagination who was able to dream up this document. He is certainly an optimist.
I come to a rather more significant matter. On pages 3 and 4 there is an attempt by the author to deal with the problem of duplication with the Council of Europe. Clearly fearing attacks such as I am making, the writer says at the bottom of page 3:
"Far from duplicating the Council of Europe's own programme, Community action in the cultural sector provides the starting point for a combined advance…it is easy to determine what each can best achieve and to make optimum use of this division of labour on both sides."
He is certainly an optimist.
The writer explains how the division of labour shall fall. At the top of page 4 he lays down that it is the task of the Council of Europe to think and of the Community to do or, to use his words,
"it is undeniably the task of the Council of Europe to continue its high-level, fundamental research on culture itself…which enables it to update and adapt basic concepts—cultural democracy, socio-cultural leadership, or integrated conservation—to the changes taking place in society."
I shall not ask whether the House would be glad to have those concepts updated—they do not come into our everyday parlance—but there may be those who would like to have them updated. That is the role of the Council of Europe—to update these somewhat vague concepts.
In the next paragraph we are told that the Community's task is
"to move on to practical measures".
We have a division of labour easily throughout, with people in Stratsbourg thinking of vague concepts and updating them and other people doing things in Brussels.
That is what is pernicious abour the document as a whole. If there is to be collaboration, it should be at the level of the Council of Europe, involving all 20 countries and not merely those which happen to have joined together in an economic community.

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There is in the whole document, under each category, the danger that exists in any bureaucracy of building up a rival machine, a new machinery in Brussels, no doubt providing well-paid and fascinating jobs for more civil servants of the Community, able to write prose just as lyrical as that in the document, but I believe duplicating work which is being done in Strasbourg and which should be done more effectively there through the provision of more resources and perhaps more qualified people. I find it particularly arrogant that the author, when explaining the objectives of the measure, says on page 3 of Annex I:
"It stands to reason that activities concerning the development of cultural exchanges must be carried out at Community rather than national level."
When I read something telling me that "it stands to reason", but without giving any reasons, I become very sceptical of the rational basis on which this has been developed. Again, that typifies the approach of this document, which is unsatisfactory, vague and will set back the cause of Community co-operation if it is pursued without proper definition and clarification.
I believe that there is room for useful co-operation within the Community on these matters which are closely linked to the Treaty of Rome and on those matters which are economic. But, in the wider sense, it is essential that we should pursue cultural co-operation at the widest level in Europe, and that is at the level of the Council of Europe.
1.52 p.m.
Mr. Patrick Cormack: I should like to associate myself closely with many of the remarks made by the hon. Member for Farnworth (Mr. Roper). He sensibly divided these two documents, and rightly gave praise to one and some severe and well-merited criticisms to the other.
I certainly welcome the Foundation, which has now been agreed upon. For the life of me, I cannot understand why people feel so apprehensive about it. It seems to me that co-ordination of this sort is one of the things which is most needed in Europe, and which is least offensive, even to those who have reservations about other areas of co-operation. I hope that the Foundation will be
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quickly established. I think that it could do a great deal of good in a modest way. I do not think that anyone could suggest that it will be a vehicle for creeping federalism.
Mr. Roger Moate: Wait.
Mr. Cormack: I shall indeed wait, as my hon. Friend says. As I wait I shall get impatient, because I want the Foundation to be established. I believe that it will contribute much good.
Mr. Moate: I was suggesting that my hon. Friend should wait for someone to suggest this, because someone will very shortly if he manages to catch Mr. Speaker's eye.
Mr. Cormack: Well, it is always better to anticipate than to react. Knowing that my hon. Friend is sitting here bubbling with indignation about this entirely unexceptionable and admirable project, I thought that I would just provoke him a little.
As I say, this is an admirable project. It is something which is needed. I cannot see that it will do any harm. I hope that it will do a lot of good. I think that we do need a cultural catalyst and a greater understanding of our common heritage and of our common cultural problems. One of the things that I have found in recent years is the lack of knowledge which exists in member countries of our respective systems for preservation and conservation. If the Foundation can help to make us more aware of how we care in individual countries, it will be doing a great deal in that sphere alone.
My right hon. and learned Friend the Member for Hexham (Mr. Rippon), to whom much credit is due for this particular concept, referred to helping such worthy schemes as youth orchestras and choirs. I hope that it will go much further than that. For instance, I hope the Foundation will consider a code of protection for our heritage in Europe. That seems to be an appropriate task for such a Foundation. Many of the things that are badly dealt with in the second document could be properly given to the Foundation to study in depth so that it could produce a decent paper.
Mr. Rippon: As I see it, the purpose of the Foundation would not be to conduct such a study itself but, for example,

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to give funds to Europa Nostra, and similar organisations, to conduct such a study themselves and then publish the result.
Mr. Cormack: Yes, indeed, but the Foundation could have a co-ordinating function and could inspire proper studies. I am grateful to my right hon. and learned Friend for what he has just said. I do believe that we have real cause for apprehension and criticism in respect of the second document. I liked the references of the hon. Member for Famworth to the prose in which it is written. It is nice to have something which is colourful, but none the less this document is bureaucratic and threatening, despite the colour.
I should like to single out a few things of which we should be extremely wary. I was glad that when the Minister spoke he damned it with faint praise. The suggestions on VAT are quite unnecessary and would be wholly disadvantageous to this country as the centre of the world's art market and everything else. We devised an admirable scheme for VAT on works of art. Many of us did not want VAT on works of art at all, but in true British style a compromise solution was reached during the period of the previous Administration and it is working reasonably well. It is far better than the nonsensical uniformity proposed in this document. I hope that no British Government would ever countenance a move in the direction of the flat 30 per cent. of selling price which is here suggested.
It seems to me that it is perfectly reasonable that we should have common codes and practices with regard to combating thefts. That is fine. No one will object to freedom of trade in cultural goods. As has been said from both sides of the House, in many cases this is a rehearsal of what already exists, and has existed, for many years. However, as I see it, it is not the business of the Community to deal with matters such as the harmonisation of laws on copyright and public lending right. The problems are different in different countries. I am one of those who has always advocated PLR, and will continue to do so until it is on the statute book of this country. But I do not think it would be easy, or necessarily desirable, to have the same system throughout the Community.
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However, there are other matters in which it is quite right that the Community should interest itself. I should like to see a high level of efficiency and proficiency in restoring. When one looks at the problems which the European heritage faces, and many of the difficulties encountered by those seeking to maintain our cultural heritage, one sees that in many countries of the Community there are not sufficient trained and equipped restorers. Although there is now a better interchange of information—one can cite the wonderful contribution of the V and A people to "Venice in Peril"—nevertheless, moves on this front are wholly to be desired. Anything which can be done within the Community to coordinate and raise standards will certainly have my support.
I should like to draw attention to something which has not yet been mentioned. It is contained in the memorandum submitted by the Minister of State for Foreign and Commonwealth Affairs and by Lord Donaldson, the Minister for the Arts. The penultimate paragraph of that memorandum contains some words which I find deeply disturbing. It states:
"Some of the recommendations in the Commission communication could, if implemented, result in significant additional expenditure being charged to the Community budget. Expenditure on cultural activities is classified as non-obligatory expenditure.".
Yes, a statement of fact, but it would seem to me eminently desirable that expenditure on these matters should become obligatory expenditure throughout the Community. Therefore, I welcome the fact that there is a Community interest, and I hope that there will be a prodding from Brussels so that we can have in every Community country a higher degree of priority awarded to culture, the heritage and the arts.
When one considers the vast sums of money that are passed with nothing more than a shrug, a nod or a wink, but that when it comes to a matter of cultural or heritage importance a small sum is suddenly regarded as an enormous one, it is quite ludicrous. With leadership from the Community, I hope that through the Community we can attach a higher degree of priority to these matters.
Recently, a Select Committee of this House presented an admirable report on the National Land Fund. With some of

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our Community partners, I hope that before long we shall be able to establish the equivalent of a Community heritage contingency fund. It is needed. It could be provided at very little cost but with enormous benefit to all the peoples of the Community. This is an area where the peoples of the Community can be served in a way that perhaps they cannot in other areas.
I welcome the establishment of the Foundation. I hope that it will soon be doing good work and that it will soon become a valued part of the European heritage and cultural scene.
I welcome this other document in as much as it shows that there is a higher degree of priority being awarded to these matters than was the case formerly. I criticise many of its contents. I am opposed to some of its suggestions. But I hope that from it we can have a continuing debate on these matters and that our common heritage will become increasingly the concern of those who sit here and those who will sit in the first directly-elected Parliament in Europe.
2.1 p.m.
Mr. Hugh Jenkins: I question the desirability of holding this debate today. In the first instance, we have had very little time to study these extremely complex documents. At first glance, I had an entirely wrong idea about the purpose of the two documents, until I studied them both in detail. It was only on closer study that I realised that my objections to one of them were much greater than my objections to the other.
I thought at first glance that the European Foundation was a harmless cultural body. Instead, it is a sinister body for the purpose of promoting a federal Europe. I thought that the other document was putting forward proposals which were intended to have a practical effect in a fairly short time in this country. But I find on closer examination that the other document is the lesser of the two, although it contains a rather curious resolution at the end, and does not seem to be as wicked as I thought it was. Indeed, I find many of its contents quite admirable. In other words, it is a curate's egg.
Mr. Roper: Which one?
Mr. Jenkins: It is curious that on a Friday we are presented with two documents which are entirely dissimilar in character. We are debating them when there are relatively few of us in the Chamber and apparently, at the end of the day, we shall take a decision which may have important implications. On the one hand, the Minister tells us that it really does not matter very much what we do and that this is really a little private chat amongst ourselves because nothing much will happen. On the other hand, the right hon. and learned Member for Hexham (Mr. Rippon) tells us that this is an important and rather earthshaking occasion and that we are deciding some very serious matters.
Mr. Spearing: It is a typical EEC mess.
Mr. Jenkins: Where precisely are we? I think that we are in the position that we ought not to be having this debate on a Friday at all. We ought to have it in two or three weeks, after we have had an opportunity to study the documents through our respective organisations. Both sides of the House have sub-committees which specialise in and study these matters. They have not had sufficient time to study the documents or to make recommendations to us. Therefore, we come to discuss complex and difficult documents unprepared, and the Government seem to want us to say "It does not very much matter. Let the documents go through. Nothing much will happen."
I am inclined to think that something will happen and, for that reason, since I wish to make my protest known, I say here and now that because I think that this debate ought not to be taking place today, if any other hon. Member decides that he would like to demonstrate his distaste for this procedure by dividing the House at the end of the debate, I shall accompany him in that decision.
Mr. Rippon: In making his remarks about taking these matters together, has the hon. Member borne in mind that that was the recommendation by the Select Committee as long ago as 26th April? In view of that, does he not agree that it might be right of the Government to ensure that the Select Committee is a little more careful in the way in which it brings these matters before us?
Mr. Jenkins: I am the last person to criticise the Select Committee. I have no doubt that it had its reasons for doing this. However, the access to the documents of those hon. Members who do not serve on the Select Committee was too recent to enable them to form a considered view. The right hon. and learned Member for Hexham is right in the middle of this subject and has been throughout. In fact, his name is mentioned in one of the documents. But there are those of us who have other preoccupations. We have not followed the whole matter through and, therefore, we do not come here today having watched its progress almost as though it was our own child. I am sure that the right hon. and learned Gentleman would not disown an element of parentage.
Those of us who are not in that position are required to drag ourselves away from our other concerns and, on a Friday, in a very thinly attended House, reach a decision which the right hon. and learned Member says is of considerable importance and which the Minister suggests is not quite as important as the right hon. and learned Gentleman says it is. I hope that my hon. Friend is right and that the right hon. and learned Gentleman is wrong. It would be in accordance with precedent if it proved to be so. That is usually the case. But I have doubt about the papers, and I turn first to the one which at first glance I thought was a pretty harmless idea; to establish a European Foundation.
The first feature that I find objectionable is that the document is totally inaccurate from start to finish in its misuse of the word "European". It does not mean European at all. It means the EEC. There are some 32 nations in Europe. The document refers to some nine nations—possibly 12 in due course—in Western Europe. So it is pernicious because the use of the word "European" in this sense leads to confusion in the mind of anyone seeking to discover what the document is about. It talks in the first paragraph of strengthening understanding of and support for the work of the Community. There we know what we are about. This is a propagandist document intended to strengthen the whole idea of the EEC and to pave the way towards the establishment of a federal Europe. I am sure that the right hon.
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and learned Member for Hexham will not deny that there is an element of that in it.
Mr. Spearing: It is the basis of it.
Mr. Jenkins: It goes on to talk of projecting the Community to the world. This is a blatant propagandist objective.
Then we move to other matters and begin to talk about the greater awareness of European civilisation. The nations which make up the EEC are very important. They are nations with great histories and tremendous contributions to European culture. But even the most committed European would hardly dare suggest that they have a monopoly of European civilisation. Civilisation is not located only among the Nine. There are other nations of Europe which have made a profound contribution to European civilisation. The appropriation of European civilisation to this rump of Western Europe in the EEC is done far too often. We get so used to hearing this that we take it for granted. We hear the word "Europe" used as if the EEC embodies the whole of Europe. Yet this is the organisation that some of us have opposed from the beginning and continue to oppose because we consider it a wrong and mistaken development. To go so far as to say that the EEC constitutes Europe is quite wrong.
For this reason I have doubts about the desirability of debating this document—and that is putting it mildly. If other hon. Members feel disposed to demonstrate that objection by dividing, I shall join them in the Lobbies.
Mr. Speaker: Mr. Dafydd Elis Thomas.
Mr. Jenkins: I have not finished my speech, Mr. Speaker. You have anticipated its termination by several minutes. I am about to turn to the second document.
Mr. Speaker: I apologise to the hon. Gentleman whose speech is of tremendous interest, only to be equalled, I expect, by the next one.
Mr. Jenkins: I am not entirely surprised that you should regard what I am saying, Mr. Speaker, as two different speeches—
Mr. Spearing: There are two documents.
Mr. Jenkins: That is true. But the reason I think that Mr. Speaker thought that I had finished was that I seldom trouble him with lengthy orations. However I expect that when I speak he will give me full opportunity to develop my points.
At first glance the second document worried me considerably. Now I am a little less worried. That is partly because of the assurances that the Minister has given and partly because there are in the document some very good proposals and some even better aspirations.
However, there are some worrying things in it as well. I am sure that it is not completely harmless. For example, there is the rather worrying approach to VAT. Personally I think that VAT is a very bad tax. I do not like it at all. Further, I take the view that to apply VAT to any area of art, culture or communications is utterly pernicious.
In this country we have taken a fairly good approach to VAT. We still have it in some areas of the arts, such as the commercial theatre where is should not apply, but on the whole our approach has not been too bad. I would be very woried if by harmonisation we mean harmonising upwards. It has been suggested that there should be a harmonisation of 30 per cent., and that would be appalling.
Mr. Cormack: The document recommends a harmonised 30 per cent. of selling price. That would certainly have an upwards effect in this country.
Mr. Jenkins: It is rather vague. Our previous experience is that trying to arrive at a common policy with other EEC countries means that we have to suffer a worsening of the good traditions, practices and customs that we have established in this country. Obviously, I would be greatly concerned about that.
On the public lending right, it is true, unfortunately, that there are hon. Members in this House—one is present at the moment—who have opposed the development of a public lending right in this country. Our scheme, which is not yet on the statute book but which I hope will be soon, is immensely superior to that which operates in Germany and Denmark. I suppose that one might say that any form of public lending right is
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better than none. I know that the hon. Member for Faversham (Mr. Moate) would say exactly the opposite. But to put all our eggs in one basket and to say that we accept this form of public lending right would be a very grave mistake.
Obviously I have grave doubts about this document. I share the view that has been put forward about the undesirability of a resolution at the end which seems to give the Commission a free hand to do anything that they wish after the document is passed. I like neither of the two documents, although I like some of the things in the second one. But for the reasons that I have given I think to take them together is also a mistake and I hope that I shall have the opportunity of demonstrating my dislike in the Lobbies.
2.16 p.m.
Mr. D. E. Thomas: I am grateful, Mr. Speaker, for the advance warning you gave that I was about to catch your eye. I hope that it caused no distress to the hon. Member for Putney (Mr. Jenkins).
This is a cultural debate and we are dealing with two different aspects of cultural policy. I believe that it is unfortunate that the Scrutiny Committee brought the two documents to the House together, but at least it gives us a chance to debate cultural policy. This is important to me as I represent a minority culture within the United Kingdom.
It is significant that this debate is taking place under the wing of European legislation. I do not remember a single debate on cultural policy in this House. We have had debates in Welsh Grand Committee on the arts, and debates in the House on broadcasting, but that is all. That reflects the awareness in the EEC of the importance of the cultural dimension and the lack of awareness in this House.
During the EEC referendum, which feels like a decade ago, my party campaigned on the slogan "Europe yes, EEC no". We withdrew that slogan after only a week because it was confusing to the electorate. I hesitate to add that the slogan was bilingual. I shall take that slogan as my text for this debate.

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It seems that the attitude towards the EEC and towards cultural policy in the EEC is as the hon. Member for Farnworth (Mr. Roper) explained earlier. This was also confirmed by the hon. Member for Putney. Europe extends tar beyond the EEC, and it also extends within and below the structure of the EEC itself.
I was very struck by the emphasis in both documents on the contact between the peoples of the Community and the diversity of the European heritage. The use of the word "peoples", which has been chosen deliberately rather than "nations", demonstrates this. When we talk of European culture we are not talking merely of the cultures of the major languages of the member States, which are official languages within the Community. We are also talking of the minority languages within those nation States which are not official languages in the Community, and indeed other languages which are official languages but not working languages of the Community.
If we study the aims of the Foundation, we find among its objectives
"support for the provision of necessary language learning facilities."
Does this extend beyond the official working languages of the Community? I wonder whether my hon. Friend the Member for Galloway (Mr. Thompson), who is an excellent Breton speaker, could take advantage of any of the facilities offered by the Foundation to existing institutions within the Community to improve his knowledge of Welsh. My hon. Friend sang in Gaelic in my constituency over the weekend but was not able to sing in Welsh. He expressed the view that he would like to do so. Does the Foundation intend to provide language assistance not only to the major languages but also to the minor languages of the Community? It is extremely important to those of us who speak minority languages.
This leads me to examine the subject of the location of the Foundation and its other objectives. I hope that the Foundation in its attempt to improve contacts between the various parts of the Community will look at developing contacts not only between the majority cultures but between the minority cultures. Some of us would have preferred to see
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the Foundation located at Rennes rather than in Paris. The centralist cultural policy of the French Government has had a more devastating effect on minority languages in France than the policies of the United Kingdom Government have had in the context of the countries of Britain.
I hope that the Foundation's attitude will be flexible towards the minority groupings in the Community and towards minority cultures. The position within the Community shows that there are over 30 minority language groups within the existing member States. I incude the people of the Faroe Islands, Greenland, the Gaelic speakers of Scotland, the Occitane speakers of France, the Catalan and Basque speakers, the Corsicans and the Bretons. There are six linguistic minorities within the borders of Italy.
All these minorities have been subject recently to increasing study and interest and policies have been developed to some degree by the Governments of the nation States to promote and maintain the minority cultures. The position of these cultures varies.
I wish to refer briefly to the situation in France in respect of the minority cultures. I wish to draw from some of the material in a great tome written by my literary boss in the Welsh Arts Council, Meic Stephens, on linguistic minorities in Western Europe. He highlights the position of Breton, which is a Celtic language closely linked to Welsh. Since I am able to speak some medieval Welsh, I can hold a rudimentary conversation in Breton, but it is difficult for a modern Welsh speaker to hold an extensive conversation with a Breton speaker.
The position of the Breton language is that on the eve of the First World War there were about 1,300,000, or 90 per cent., of the inhabitants of Lower Brittany who spoke Breton. Breton was the Celtic language that was most widely spoken in the modern age. Over that period the language has declined.
The latest survey was one conducted on 21st February 1974 by the Breton newspaper in Brest. It revealed that out of a total population of 1,500,000 in Lower Brittany, only 685,000 people-44 per cent.—were capable of speaking Breton. Of these, only 18,000 out of

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360,000 were children under 14, while 56,000 out of 225,000 were aged between 15 and 24 and 400,000 were between 25 and 64, and 168,000 out of 200,000 were over 65. Those statistics speak for themselves. There is a decline in the number of Breton speakers, particularly in the younger age groups.
Although I have attended a number of Fez Noz in Brittany in recent years, it is difficult to find in many parts of Brittany examples of the official use of the language in education and broadcasting. Indeed, the television time awarded by the French channels to Breton is only five minutes per week. That reflects on the centralist policies of the French Government, in regard not only to Breton but to the language spoken by the overwhelming majority of the populaion of Southern France. There are about 15 million people who live in Occitanie in Southern France, and of that population is is estimated that about 2 million use that language in their daily lives. That language has no official status in France. This again reflects the centralist policy of the French Government.
I hope that when the Community comes to examine cultural co-operation between the various member States, it will also invesigate the need to develop cultural links between minority language groups.
One of the most psychological problems of minority language groups is that they feel themselves to be isolated and up against a majority culture. This leads to frustration and to the attempts at direct action which have taken place in almost all the minority language areas in recent years to try to obtain some degree of State support and legal status and of use in business life and broader cultural support for the languages. An understanding within the European Community of the nature of minority languages would be helpful to these peoples.
I should like to see the Foundation funding work on the probelms of bilingualism and biculturalism as they affect minority groups. It could fund the study of teaching techniques not only for majority languages but for minority languages.
The Foundation also devotes part of its objectives to improving contacts between
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young people in various parts of the Community. I was particularly impressed by the proposals for exchanges of young workers. There is a danger in the EEC that we are exchanging only elites. We are conscious of a European heritage as between various educated elites, particularly those in higher education, but we are not so conscious of the needs of those people who leave school and go straight to work. I believe that exchanges of young workers organised through existing bodies, such as the young farmers clubs, if funded through the Foundation, would be extremely beneficial.
It is also important that the cultural activities of the Foundation should not be linked only to the forms of what we have come to call high culture or minority culture. I am impressed at the fact that the Foundation's proposals are aimed at the largest possible number within the Community. I hope that the Foundation will be able to provide support not only for book, architectural and artistic culture, but also for media and film culture. Here again, minority language groups have specific problems. Mass media culture tends to be organised on the massive scale of French-speaking or English-speaking culture. It is often difficult for the minority language group to provide the visual means of mass communication in its own language.
Attempts have been made. There has been established in Wales recently the Bwrdd Ffilmian Cymraeg. We have been involved in a long campaign to try to get funding from the Department of Education and Science and the Welsh Office for this body, but so far we have been unable to do so. The Welsh Arts Council has given some funding, but there have been no funds made available by the Government to enable this film-making board to continue its activity. At present, funding is available only to maintain its staff in posts, but there is no funding to enable the body to make films.
The position is similar for other minority languages. Some have more access to television time than others. We have a Government commitment on the allocation of the fourth network in Wales, and this will improve the access of Welsh-speaking people to media culture, but in order to do this effectively, we need to be able to exchange television programmes and funding to

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improve dubbing facilities and so on. What applies to Wales in the United Kingdom context applies with equal force to Breton and other minority languages in Europe.
I hope that the Foundation will look at these problems because it could make a distinctive contribution to improving understanding and techniques of communication, not merely at the nation State level and between majority European cultures but between minority European cultures.
I take a different view on the document concerning action in the cultural sector from that taken by some opponents of the EEC on the Labour Benches. The document tells us that EEC action in the cultural sector does not constitute a cultural policy. I believe that the Community should have a cultural policy. Within the EEC, we should be moving towards a common cultural policy which could be of particular assistance to the smaller cultural groups.
For example, we have common policies that are specifically designed to provide assistance to remote regions. It comes mainly through the common agricultural policy and FEOGA funding for hill and less-favoured areas and so on. It is time that the Community thought imaginatively in terms of using its social fund for hill and less-favoured cultures—cultures that are in a difficult position because of the increasing economic integration and centrifugal pull of the Community. Is it not time that the Community looked at ways of funding the cultural infrastructure of its remote regions and minority cultures as well as funding its economic infrastructure?
When we talk about the conservation of the artistic heritage of Europe and the major artistic monuments of our heritage, we must also appreciate that linguistic conservation is as much a part of the conservation of our heritage as is architectural conservation. An ability to understand the work of the mediaeval Welsh and Breton poets and the troubadors and to maintain that culture must be as much a part of the conservation of the European heritage as is the conservation of our architecture.
The Council for the Welsh Language has proposed to the Government that £18 million should be made available annually
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for supporting the Welsh language culture. The Secretary of State has said that it is a matter for discussion and may be a matter for action by the Welsh Assembly if it is established. The argument is always that there is no funding available on a United Kingdom basis to give the sort of cultural support that we need to maintain and develop the Welsh language.
Mr. Litterick: Has the hon. Gentleman read page 3 of Annex 1 to Document R/2982/77 (AG 67)? May I draw his attention to the fact that in the context of something called "Europalia"—whatever that is—multidisciplinary teams of university professors, senior lecturers and postgraduate students are to be mustered to examine a festival in Brest? Does the hon. Gentleman not concede the possibility that such a multidisciplinary team financed by, for instance, this Foundation, is unlikely to have a very respectful consideration of local culture, bearing in mind what the document tells us what they are really at?
Mr. Thomas: I am grateful for that intervention. I intended to mention the scrutiny and assessment of European cultural festivals. Is the assessment to be merely an assessment of the metropolitan culture, which is the point made by the hon. Member for Birmingham, Selly Oak (Mr. Litterick), or will it be an assessment related to the culture of the area concerned? I know the Brest area fairly well and I am well aware of the sensitive problems faced by Breton speakers in that area who are seeking greater opportunities for their children through the French education system but are being denied those opportunities. I suspect, as does the hon. Member for Selly Oak, that the tendency will be to evaluate on a metropolitan culture basis rather than on a minority local culture basis.
There is a proposal that the Government should spend £18 million on maintaining and developing the Welsh language. We are told that resources are not available. Why cannot the Community look at the possibility of making resources available from its social fund or a new EEC cultural fund so that the United Kingdom Government will be able to take advantage of those resources to maintain and

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develop Welsh? What I argue for Welsh, I argue for Breton and all the other minority languages in Europe. The richness and diversity of the European heritage must mean the conservation and development of these localised, minority, small nationality cultures as much as the development of the cultures of the nation States.
I turn finally to the festivals that the cultural policy is supposed to be evaluating. We already have in Wales an international festival at Llangollen with which I am associated. It will be held at the beginning of next month, and any hon. Member who can find time to attend will be welcome. It is a festival of dancing, singing and performing arts to which groups are attracted not only from Western Europe but from all sections of the developed and the Third World. This festival should be studied by the multidisciplinary teams of professors.
Mr. Cormack: Perhaps they will compete.
Mr. Thomas: I doubt whether they could form a choir, and if they could, I doubt whether they could sing in tune—certainly not in four-part harmony.
This sort of festival should be studied so that it can receive support. Of course, there are other festivals, such as the National Eisteddfod, to which the Government contribute £250,000, which immediately trebled its budget for Welsh language spending. Should not other festivals in smaller cultural areas of the Community be studied as part of the cultural policy, and funded? These individual, small cultures have as much to contribute to the members of those cultural groups and to the broader European heritage as any major European cultures.
The United Kingdom Government have a role to play here. When Ministers are talking about cultural affairs with, for example, the French Minister of Culture, it might be appropriate for them to put to the French Government the views held by hon. Members of all parties in this House on the cultural policies of the Government and the need to foster minority cultures. I hope we shall have that assurance at the end of the debate today.
2.41 p.m.
Mr. Nigel Spearing: I think that the hon. Member for Merioneth (Mr. Thomas) has properly used the so-called cultural debate to point out that nations, or collections of nations, do not necessarily, in his view, give a fair deal to minority cultures. I think that he was justified in doing that.
I suggest that this is a political, not a cultural, debate. If, in the effluxion of time, the Foundation gets off the ground—I hope that it does not—the Welsh-speaking cultural people, whom the hon. Gentleman represents, will find that, if they want grants, there will be hooks in the conditions either explicit or, more likely, implicit. Before very long the young people and others of whom the hon. Gentleman spoke would be shown the advantages of European union in the political sense. That would be a channel to the young people of Wales to persuade them that European integration of the kind which is not favoured by many people in this country would be a good thing. Therefore, I believe that basically this is a political debate.
There has been agreement on two matters by all who have spoken, except the Minister—namely, that these matters should not have been put on the Order Paper as one motion. There are two distinct questions before the House. One concerns Document R/2982/77 on the cultural sector, about which there seems to be general discontent, and the other relates to the four other documents on the so-called European Foundation. It is on that question, which divides the House, that I wish to speak. I am sorry that the Lord President, in his role as Leader of the House, did not put down two motions. I think it improper that he did not. I hope that he will take account of my request.
The opening speakers in this debate did not do justice to this subject. One of the most remarkable omissions was any indication about how much money might be raised and its impact on this country. It was not until my hon. Friend the Under-Secretary spoke today that we had any indication of the Government's attitude to the Foundation. An attitude was expressed in the memorandum concerning the cultural sector.

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One of the defects of our procedures is that, when the Government produce a White Paper, a Bill, an order or something of that description, everyone knows that they are in favour of it. But the procedure which perforce we have to adopt for EEC matters means that we do not know the Government's position until the Minister makes a statement from the Dispatch Box.
The most remarkable feature of the two opening speeches was the difference of opinion, aided by interventions, on whether the objectives and scope of the European Foundation had been agreed. I think that reference to Hansard will show that it is a disagreed point between the two Front Benches.
Mr. Rippon: I simply had regard to the text which was issued after the Heads of Government meeting at Copenhagen on 7th and 8th April. From that it is clear that the
"Heads of State and of Government laid down the scope and objectives of the Foundation and agreed on the framework for its structure and financing. The European Council decided that formal discussions on setting up the Foundation should he conducted as soon as possible. The seat of the Foundation will be Paris."
Mr. Spearing: I am grateful to the right hon. and learned Gentleman for that intervention, because that concerns my next point. The Heads of Government meeting on 7th and 8th April, if I recall correctly, was extra-constitutional. The right hon. and learned Gentleman nods his head. It was an informal meeting, the results of which were put into legislative form inside the EEC constitution by, not the Heads of State, but by the other Council. The documents are confusing on this matter. It is at that stage that the overall objectives may be changed. But it is difficult in practice for that to be done.
What Foreign Minister—indeed, what Minister of any kind—would go against what was tacitly agreed by his Head of State at the Copenhagen Summit? That is one of the ways in which the EEC can deceive the people whom it seeks to represent.
I suggest that in practical terms it is impossible for a country to renege on what its Head of State agreed—possibly over the dinner table, for all we know—as part of a package deal. I suggest
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that, unless we have evidence to the contrary, that procedure was adopted in this instance. The Heads of Government and the Council meet in secret, so we do not know where we are. I suggest that that is one of the ingredients in the disagreement which has clearly emerged across the Floor of the House today.
Mr. Tomlinson: I hope that my hon. Friend will appreciate the point that I tried to make earlier. There is all the difference in the world between the statement of the European Council—
Mr. Spearing: Which one?
Mr. Tomlinson:—of an intention to establish a European Foundation in Paris and the position explained by the right hon. and learned Member for Hexham (Mr. Rippon)—that we have not yet agreed exactly what the objectives should be. There is a general declaration of outline. The intention and the wish of the European Council is that the Council of Ministers should discuss the matter in detail as soon as possible. That is the importance of the debate today.
Mr. Spearing: I understand that that is the Government's position, but, as I develop my argument, I shall suggest that it is unrealistic. Indeed, it is as unrealistic as the belief of the right hon. and learned Member for Hexham (Mr. Rippon) that he was right on the fisheries issue and on protecting British interests. It is clear that he did not and could not.
Mr. Tomlinson: That is not analogous.
Mr. Spearing: We shall see. I believe that the Government have misread the situation. Unless they show good cause to the contrary, that unfortunately is the position.
I turn now to the famous Early-Day Motion No. 108 which was mentioned by my hon. Friend at the commencement of his speech and which I challenged at once. The importance of this motion was made clear by the right hon. and learned Member for Hexham. He said that the Tindemans Report on European Union was, in effect, a dead issue and that nothing would come out of it until a majority of Members passed or put their signatures to the motion, and therefore it became a live issue.
I want to draw atention to the wording of the Early-Day Motion. It has a

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preamble, but I shall not read that. It refers to:
"launching a European Foundation on the lines recommended in Mr. Tindemans' Report, to be financed partly by grants from the member States and partly from private funds, with the aim of promoting, either directly or by assisting existing bodies, any measures which will help towards greater understanding of European aims, but placing the emphasis on human contacts such as youth activities, university exchanges and town twinnings."
I do not know what was in the minds of hon. Members who signed that motion. They probably noticed town twinnings, university exchanges, youth activities and all these excellent things which I would support. It is the "European aims" which worries me. Mr. Tindemans' report was concerned not only about how we should operate the Common Market as it is, but about—indeed, these were his terms of reference—European union. For my hon. Friend the Minister to say that all that was agreed was in principle to set up the Foundation, and then for him to pretend that it was nothing to do with what Mr. Tindemans said means that he is mistaken, and that is the kindest adjective I can use at this stage.
The Tindemans' Report dealt not only with European union; a whole chapter of it was devoted to the European Foundation. It is Chapter 4 and it is entitled "A citizen's Europe". Tindemans said:
I propose that the European Council should decide to create a European Foundation",
and he continued along much the same lines as we have heard. He finished by saying:
"This Foundation will also have a rôle to play in presenting abroad the image of a United Europe. By virtue of its character, this Foundation will often be able to intervene more flexibly and more effectivly than national or European authorities. It will also offer the innumerable supporters of European unification in our countries an opportunity to make a personal contribution by aiding the Foundation. In this manner it will be more clearly apparent that the creation of the Union can and must be a matter for us all."
In view of that, I should have thought that for the Government to say that the objectives and scope of the Foundation are up for grabs and yet to be decided is a mistaken submission.
My hon. Friend the Minister has pointed out on a number of occasions
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that we are quoting from out-of-date documents. I do not believe that the Tindemans Report is out of date in relation to the European Foundation. My hon. Friend may be able to claim that the Commission Report on this matter, made in 1977 and part of Commission Report 61/78 or Com. 77/600—documentation, of course, is always confusing—is out of date. The later document that my hon. Friend may claim supersedes it, which is Document R 734/78 of March this year, cancels it out. But there is nothing in that later document to contradict Commission Report 61/78.
It is to the Commission Report that I now turn. It is a very extensive and thorough document. In its opening remarks the Commission makes it clear that it was not the work of the Commission unaided. It set up an advisory council of outside experts who produced the framework of the report, and I see that among those whose names are appended to it are those of the right hon. and learned Member for Hexham and Lord Asa Briggs. I suspect, therefore, that quite a lot of this document was produced by the outside experts and perhaps was added to by the Commission itself. They make it clear that they follow the Tindemans line. One page 22 they repeat
"The need to provide the Foundation with maximum room for manoeuvre,"—
I bet!—
"the intention to entrust it with the task of promoting private initiatives in the move to achieve European union";
and then at the end it repeats Mr. Tindemans' point about opportunities for supporters to supply funds. The report makes it clear that it follows the Tindemans line. I can see nothing in later documents to suggest that that has now gone out of the window. It includes an interesting paragraph on the research into European integration, and that is practical, not only theoretical, research, and a number of other topics.
So it seems quite clear, unless the Government can offer some proof to the contrary, that the objectives and the operations of this Foundation are already more than half agreed, in practice if not de jure.
A number of other matters in the document could perhaps be changed, but the structure of which is fairly clear. There

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will be a council to run the Foundation, and it is proposed that it should meet twice a year. There will be a management committee of about nine distinguished European figures who will presumably be the patrons of the substantial funds that will be scattered around the Community. These people will presumably be in a position of patronage and able to decide what sort of organisations will receive money, and upon what basis and criteria and according to which priorities the funds will be allotted.
The Commission document also deals with the legal status of the Foundation. This is of considerable significance. It discusses a number of ways by which the Foundation could be established. As I understand it, it comes down fairly clearly in favour of the solution of using Article 235 of the Treaty of Rome. The difficulty is that the Common Market does not make explicit provision for such a Foundation in the Treaty. A means therefore has to be found whereby public money can properly be channelled to it.
Article 235 is the let-out clause in the Treaty of Rome. It reads
"If action by the Community should prove necessary to attain, in the course of the operation of the common market, one of the objectives of the Community and this Treaty has not provided the necessary powers, the Council shall, acting unanimously on a proposal from the Commission and after consulting the Assembly, take the appropriate measures."
In opening the debate, the Minister said that this should be part of the obligatory expenditure of the Community. I see him nodding his head. But Article 235 is surely the non-obligatory part. Therefore, if the expenditure is not under Article 235, may we be told under which article the Government expect to support the creation of the Foundation? Surely the matter cannot be covered by Article 100 because that deals with the harmonisation of existing powers. If it cannot be done under Article 235, surely it cannot be done at all. To do it under Article 235 would require the unanimous assent of the member States.
In a letter to me, my right hon. Friend the Minister of State made it clear in a discussion on the expanded powers of the Assembly that
"the decision to launch such a new policy has to be taken by the Council of Ministers, acting unanimously".
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So it is clear that the Government have a positive veto. Therefore, if the proposal goes further, the Government will have to give their assent under Article 235. I believe that on the present basis the Government should not give that assent. If they are to be true to the Prime Minister's letter, which was quoted by my hon. Friend the Under-Secretary, they cannot give their assent, for the reasons I have explained.
Not only is the Foundation obviously and clearly designed to promote European integration and European union. It does it in a very clever and effective manner. It does it by making grants to existing organisations, and we are told in the financial part of the proposals that the eventual sums of money will be between, initially, 5 million and 10 million units of account and ultimately 20 million, which, taking an exchange rate of £1·5 to the EUA, is in the region, possibly, of £10 million a year. Of course, that could be reduced, but equally it could go up.
But, as has been made clear, this money is not only money which is likely to be in the Foundation. There will be calls on corporate and private persons' purses, and the proposals make it clear that it is expected that nation States will give tax relief on the money so donated. So the additional money which it will hope to collect will attract some tax benefits in the countries from which it is drawn.
I ask my hon. Friend the Minister of State, Department of Education and Science, who has some knowledge of educational charities, whether the EEC Foundation will be subject to the charitable exemptions which we have in this country. Clearly it will be a political charity, and we in this country quite properly say that political charities shall not be exempt from tax. But even if it was not exempt in this country, it would no doubt be exempt in other countries, and therefore valuable additional private moneys will be donated at public expense.
I return to the method by which grants will be made. It will, of course, be indirect, and therefore, any body promoting exchanges, visits or cultural activity of any sort, or, indeed, wishing to have a look at the EEC will quite clearly have to show evidence of being in tune or in accord—or certainly not out of accord—with the objectives of the Foundation.

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Therefore, if the organisation which may apply for assistance can show that it is providing an opportunity for a speaker of a European union or someone from the Community to address a meeting or conference, or perhaps to distribute literature, that will be all to the good. If I were a trustee of such a fund, I would think that that was the right thing to do and would certainly bear it in mind when looking at the applications and the undertakings that would be given, or, indeed, the likelihood of such additional activities taking place with the applicant body. Therefore, I suggest that the indirect effects of this Foundation could be very considerable indeed.
But the matter does not end there. There may be many organisations that would like to have the money, but they know that they would not stand a chance unless their oriented or slanted their existing activities in a particular direction, because they would know very well that unless they did that they would not stand a chance, or would stand less of a chance, of getting the money.
Therefore, the idea of complementarity, which sounds so nice and is a good word, is in fact not complementarity at all. It is an amplifier circuit. As has been said, it is a catalyst. That is quite right. A catalyst enables things to happen which did not happen before, and it will amplify the effect of this fund in many subtle and unseen ways which might not be able to be proved.
One of the other objectives of this organisation is that it can provide money for research. The universities of this country do quite a bit of research on EEC affairs. One of them has an institute of European studies. I shall not name the university concerned, because I was told only yesterday that it gets a substantial amount of money from the existing European institutions. I shall have to check that. Therefore, I shall not name it. But let us suppose that it got only half its present funds from existing EEC sources. This Foundation will be more flexible. I suggest that one of the important factors in academic life is objectivity. How can any institution or person that is expecting or would hope for money from such a foundation or, indeed, moneys from the EEC at present be expected to be impartial?
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Indeed, the matter goes further than that. Money can buy advocacy, but money can also buy silence. If an individual or an institution or a body which may be operating for excellent purposes hopes for resources from a particular quarter, it is less likely to be objective and less likely to speak out when it ought to speak out than it would be if those resources were not available.
I do not say that the European Foundation would operate knowingly in this way if it were founded, but I suggest that there are certainly dangers in that direction.
When British liberties are at stake, we expect dogs to bark. Everyone knows the famous Sherlock Holmes story of the dog that did not bark because it trusted someone who was betraying its trust. The Government should have barked, but instead several Ministers' names appear on the motion. The right hon. and learned Member for Hexham, who knows more about the background to this Foundation than anyone else, did not disagree on the facts—I do not expect him to agree with my opinion. How anyone can claim that the Foundation has nothing to do with European union is past my understanding. The only charitable explanation is that they have not read the documents as I have or seen the possibilities.
Mr. Rippon: The hon. Gentleman said that I have not disputed any of the facts, but only his opinion. In the document prepared by the working party, we carefully concluded that the final choice of objective and priorities should be taken by the European institutions. We said that because we covered a wide range of possibilities. The Commission then made certain changes in the thrust of what the working party suggested. As I understand it now, the decisions of the Council of Ministers improve upon—at least in my view—the views of the Commission. So this is a continuing process, and the hon. Gentleman should recognise that.
Mr. Spearing: I am grateful to the right hon. and learned Gentleman for partly confirming what I said and for adding some information. But that immediately illustrates our problems with the EEC. Although there may be some modifications, the background still stands.

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It has not been negatived. The Foundation, when established, will have at least as much money to disperse in the United Kingdom as the Nuffield Foundation—that is, £1 million a year. On the figures on the documents, that could easily be the figure available in two or three years.
Therefore, when these grants and activities get going and people begin to object, saying, "We did not realise that it would be like this", they will be able to point back to these documents, to the Tindemans Report and even to my speech and say "It was all clear at the time."
Mr. Litterick: My hon. Friend may have assumed that the sums of money written in these documents are the probable grants to the United Kingdom. Surely they are not. They are probable contributions by the British taxpayers to this European body, which they will not necessarily get back, if the history of the EEC tells us anything.
Mr. Spearing: I think that my hon. Friend has to think about income and expenditure. I was referring to the expenditure by the Foundation. The converse is true. If some parts of the Community lag behind on integration or are less enthusiastic for a European union than others, if I were a trustee of this institution I would switch the funds accordingly. I might give more to those areas where I thought fertilisation was required.
Unless the Government can show otherwise, it seems that, far from being neutral, the concept of this Foundation is to further European union. In quoting the Prime Minister as saying that we do not favour European union, the Minister is trying to get the House to take note of these documents without dissent, thereby tacitly agreeing to a Foundation which could be against the freedom of this House and the British people. Any economic union in Europe will clearly be at the expense of the powers of this House and the self-determination of the British people. I am surprised that my hon. Friend the Under-Secretary wags his head in disagreement about that obvious point. There is a distinct risk that this fund, through the use of British taxpayers' money—as well as the money of taxpayers from elsewhere—could undermine
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the principles of the freedom and sovereignty of this House which the Government claim they seek to maintain.
3.10 p.m.
Mr. Roger Moate: There seems to be some doubt about what precisely the Government have agreed. One thing is clear. They have already agreed in principle to the establishment of a European Foundation. Is it not somewhat discourteous to make such a commitment without bringing that proposition to the House? It seems that that could have been done, and I think that it should have been done.
We have been told by the Under-Secretary of State that the objectives of the Foundation have not been agreed. It seems odd that a Foundation such as this should be set up in principle without anyone knowing precisely what it is to do. In that sense I much prefer the version of events given by my right hon. and learned Friend the Member for Hexham (Mr. Rippon). He read out the statement made following the Copenhagen meeting, which said that the objectives had been agreed. I suspect that while this debate will have some effect on the margin, broadly speaking the decisions have already been taken in principle. It is likely that progress will follow the lines laid down in the documents before us.
In procedural terms this is the sort of thing which the House could have debated before the event. Why was that not arranged? If support is required for a proposition of this kind, the House of Commons should have been involved at an early stage. That would have avoided procedural disputes arising.
If we were talking about a Foundation which would be devoting its resources to promoting festivals in Llangollen or sending youth orchestras around Europe or choirs and the like around Europe, I would have no objection. If the Foundation were to be used for promoting cultural exchanges between European countries—not just Common Market countries—I doubt whether anyone would quarrel with the proposition.
My right hon. and learned Friend and others have hotly denied that this Foundation has any propaganda purpose. It has, they say, a cultural purpose. If that is so they could have tried to avoid

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some of the traditional federalist argument that appears throughout this document. In promoting this Foundation I do not believe that my right hon. and learned Friend was seeking to establish a federalist propaganda machine. But once this institution has been created it will be beyond his control. Given the philosophy that runs through the documents and give the fact that the person in charge of the Foundation could be an enthusiastic federalist, it has to be acknowledged that once it is established, the matter is beyond the control of my right hon. and learned Friend. There is a danger that something which he thought would be a genuine association, promoting cultural exchanges, will become a propagandist machine for European union, thinly disguised as a cultural organisation.
Mr. Tomlinson: And the Government would agree to that?
Mr. Moate: The Government agreed to the Foundation being established. Once that has happened it is beyond their control. I suspect that after the Foundation is established, the money that would go into it would be used to promote seminars on economic and monetary union, to promote exchanges so that people could see more of the Brussels bureaucracy and to enable lectures to be given on the need for a common currency. This is not a figment of my imagination. It is in the documents. They have been quoted but they bear repetition. If my right hon. and learned Friend had not wanted this to be the philosophy behind the Foundation he should have avoided this language.
One sees from the beginning that the genesis of this proposal comes from Mr. Tindemans' report on European union, so at once it has to be seen in that context. The introduction to the document says that the Foundation has
"the object of making European integration"—
not unity, but integration—
"'a matter for us all'".
On the next page, it says, obviously with a touch of regret,
"Nor does it"—
the Community—
"have even a symbolic presence in their midst: no flag, no currency, not even (as yet) a common passport".
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So clearly this is seen as a substitute for these other supranationalist trappings that the federalists so often claim to be desirable.
Later, according to page 3, Mr. Tindemans added,
"This Foundation will also have a role to play in presenting abroad the image of a United Europe."
He uses a capital "u" and a capital "e". That is what Mr. Tindemans said, and that is the document we are being asked to take note of today. It is that theme which runs throughout these documents and which I say will set the theme and the spirit of the Foundation.
All that could have been avoided. It will be interesting to know whether the Minister can avoid it. We are now in his hands. The Foundation has been agreed in principle. It will obviously go ahead. But the Government, I suspect, if they show willing, can lay down very strict rules and can say explicitly that this will not be a propaganda machine, that it is there not to promote the EEC but to talk about European culture. If the Government can do that, so be it—it will be a welcome step forward. But there is no sign of it in these documents as they stand and which, broadly speaking, we are being asked to approve, since "take note" often implies that the House has given its assent.
It seems to me that what we are setting up here is a propaganda machine for the Common Market, and not what was originally no doubt genuinely intended to be a sensible vehicle for promoting general understanding and cultural exchange between members of the Common Market.
The further question arises from a clear statement made by the Under-Secretary of State. He said that the competence of the Community to legislate on these matters did not exist. Why, then, are we here at all? Why are we debating in the House matters of cultural exchange and educational matters that are not in the Treaty of Rome? I do not want at this stage to elaborate on this aspect at great length, but I am sceptical whether Article 235 gives a proper legal basis for a foundation of this kind. If that is so, why is the House discussing these matters in such depth?

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Even if a legal basis could just be squeezed in by the lawyers—and they are clever at squeezing such things in—it is clear that, at every turn, there are those who are anxious to stretch the Treaty of Rome further and further so that it embraces every aspect of our life. It would have been more proper for the Government, given their fairly robust line on Community matters generally, to say, "No. This is outside the scope of the Treaty of Rome and we shall have no more to do with it."
That brines me to the other document, which is surely even more positively outside the scope of the Treaty of Rome, and therefore one wonders again why this sort of document comes before us. It is a document on
"Community action in the cultural sector".
I do not know where cultural sector activities appear in the Treaty of Rome—I do not think that they do. If so, the document has very little value. But when one analyses it, one finds that it has even less value.
There is an element of farce in the presentation of some of these documents. The introduction refers to the Paris Summit, quoting the final communiqué as saying that the Community
"should result in an improvement in the quality of life as well as in living standards", and that
"particular attention will be paid to intangible values".
That is the preface to legislation, or proposed legislation. As soon as one uses the phrase "intangible values", one tries to produce Community legislation which will somehow embrace them. So often in these Community documents one finds great sentiments or grand platitudes, with an attempt to try to elevate them into legislation or guidelines for countries such as ours to accept.
The more we look at the documents, the more we see that they fit into that theme of useless platitudes sometimes verging on dangerous interference in matters which are properly this country's concern. I am not opposed to many of the harmonisation ideas in the documents There is nothing wrong in harmonising value added tax if one can do so voluntarily. It is a desirable objective. There is nothing wrong in trying to harmonise public lending rights, because that would
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make for a freer exchange of a variety of matters. But what I object to is Brussels trying to tell us how we should do it, particularly when it has no legal basis in the Treaty of Rome.
The issue that I particularly wanted to talk about was public lending rights. I had expected to cross swords with the hon. Member for Putney (Mr. Jenkins) on this matter, but I found that he and I were in almost total agreement on our general approach to the documents.
I am opposed in principle to public lending rights, because I do not think that there is such a thing as a right to any benefit through the public lending system, but I am not opposed to proper help for authors. That is a very different matter.
There could be some benefit from harmonisation of treatment of authors in different Common Market countries. I believe that, for example, the Republic of Ireland is much more generous to authors. I believe that many of them pay no tax. Let us harmonise on that principle, but let us have no compulsory harmonisation on this or any other public lending rights scheme.
The Government document states clearly that they are still in favour of their scheme. I believe that to have been a had scheme. It was administratively unfair and nonsensical. It proposed that £1 million be spent, with half the money going on administration. The scheme would have paid about £5 per author per annum, with no benefit going to the writers of works of reference. Most would have gone to fiction authors whose books were lent from the library shelves.
That was a bad scheme. Paradoxically, I think that the Community scheme is somewhat better. As I understand it, the proposal offers a payment for books on the shelves. That would mean that more serious writers, whose books were not borrowed as much, would still receive a payment, instead of the money simply going to the most popular authors, who are therefore probably the least in need of any financial support.
I should like to see the Government adopt their next statement as a matter of principle:
"The Government's policy is to provide selective support through the Arts Council on the basis of an expert assessment of merit."

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That is the way to do it—through the Arts Council and not through a public lending rights scheme. This feature of the Community's proposal is objectionable. The Government's position is wrong. We should drop public lending rights from our discussion, whether it be Community-inspired or inspired by the Front Bench. Then we can work on other means of assisting authors, through the tax system or selective support through the Arts Council.
I believe that neither document before us will contribute anything to the benefit of the people of this country. We should be as well off without the documents.
3.23 p.m.
Mr. Douglas Jay: The speech of the hon. Member for Faversham (Mr. Moate) has shown that there is scepticism in all parties about the proposals before the House.
We debate these matters in a cultural atmosphere, which has been demonstrated by the fact that the hon. Member for Harrow, East (Mr. Dykes), who has now left us, was fast asleep through most of the debate. That may be an appropriate state of mind for a pro-Marketeer, who simply stands aside and watches all these events going forward, but I regret that the hon. Gentleman has left us. I regard it as unfortunate that these far-reaching proposals should have been rolled up together in one take-note motion and discussed at a time when many hon. Members cannot easily be in the House and it is exceedingly difficult to have an adequate debate.
The two proposals for a European Foundation and for cultural exchanges are, of course, important. But for the sake of brevity I concern myself mainly with the proposal for the so-called European Foundation. As I think the debate has shown, this is neither non-controversial nor trivial. For those who have not studied the papers carefully, it is represented as a purely cultural organisation. I agree with the hon. Member for Faversham that if it was only a matter of cultural exchanges and contacts between students and universities, there would be no objection or political controversy about it. But as soon as one studies the documents, one finds that this proposed Foundation is largely, although not
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wholly, a poiltical propaganda organisation which is designed to spend public money on propaganda in favour of what is alternatively called "European integration" or "European union", all of which means leading the EEC into some sort of federal State.
There are a number of documents, and I shall not go into them in detail at this time of the week. But the basic document is entitled "Report from the Commission on the Establishment of a European Foundation.". It starts very candidly under the heading "Tasks and objectives" with the following phrase:
"To strengthen understanding of, and support for, the work of the Community".
In addition to a lot of other phrases it goes on to state:
"A continued high level of popular support for the Community cannot be taken for granted."
That may well be true. Mr. Tindemans is then quoted as saying:
"This Foundation will also have a role to play in presenting abroad the image of a United Europe".
We then come to the Report from the Council to the European Council which is dated as late as 3rd April this year. At the start of that we read:
"The objective of the Foundation is…to promote the better understanding of the European cultural heritage "
—that sounds innocuous—
"and to further a greater understanding of European integration".
The documents are simply studded with phrases of that kind which one need not set out in detail. What all these documents show is that whether or not one favours a federal EEC—of course, opinions legitimately differ, although I understand that the Government do not—this Foundation is intended to promote not just cultural aims but political argument.
Mr. Spearing: That is right.
Mr. Jay: Of course, controversial political argument is perfectly legitimate, but what is not legitimate is to finance it with the taxpayers' money under the disguise of setting up a cultural, educational organisation. Indeed, the slide nowadays into the use of taxpayers' money for controversial political purposes, which seems to be seeping into this country from the Continent, is a particularly

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vicious tendency. Substantial sums of public money are involved. For instance, 20 million units of account, which is about £10 million, are mentioned. Here, if anywhere, is a good case for economy in public expenditure, about which we are always hearing lectures from Conservative Members, although we never get a practical instance of where it might be adopted. The most effective possible way of carrying out economies is to stop spending money on new projects which have not yet been adopted.
It seems to me that this European Foundation is even more objectionable for two other reasons on which, to some extent, the hon. Member for Faversham touched briefly. First, we are told that the Foundation is to be independent. That sounds very fine. But what it means is that as soon as its board is set up—with possibly the right hon. and learned Member for Hexham (Mr. Rippon) its chairman, for all I know, and I am sure that he would have the best of intentions—it can spend these millions of public money as it chooses with no control by Governments or Parliaments anywhere in the EEC. That seems to me to be a thoroughly bad principle.
Secondly, and even more objectionable, it is to be called "a grant-making body". We all know from experience of the European Movement over recent years—a strange, hybrid quasi-public, quasi-voluntary body—what that tends to mean. It means an attempt to influence by money payments all sorts of organisations, from universities to newspapers and heaven knows what, in the conduct of publicity and propaganda. Some unkind people, in plain English, would call this bribery or corruption, especially when it begins to influence universities, schools and newspapers. When it is done in the pro-Market cause, it is described as a grant-in-aid, a subsidy, a subvention or some other more polite word.
If this Foundation intends to finance political propaganda for a federal EEC with public money, it is a vicious proposal. If it does not, it is entirely unnecessary. There are already numerous organisations in Western Europe and elsewhere which can promote educational exchanges, cultural contacts and so forth, notably, incidentally, the Council of Europe's European Cultural Foundation now operating in Amsterdam, which
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covers a much wider area of countries than the EEC. We already have that European Cultural Foundation, to which no one objects because it is genuinely a cultural Foundation, and it is mentioned in the documents. If that is the intention, why should not it carry out this job adequately? Why have a second European cultural Foundation which will arouse all these suspicions?
From what I understood of the Minister's contribution to the debate, he suggested that the Government's attitude would be to keep a close eye on this animal, to insist on safeguards, to tighten the terms of reference, and so on. But this leaves us in a very unsatisfactory position. Where are the terms of reference? Are they not already in these documents?
If the Foundation is to be genuinely cultural and non-political, to which none of us would have objection—though we might feel it to be unnecessary—and to have no connection with European federation, it would be an entirely different animal from the one described again and again in these documents.
May we know today what terms of reference the Government have in mind? I hope that they are proposing to lay before the House at some period in the future some new document which will be the effective terms of reference of this organisation. If so, may we be told today that no British commitment will be given to any such scheme until the House has seen, debated and approved the proposed new terms of reference of this Foundation? If we could be sure of that, our anxieties would be abated considerably.
So far no sound case has been made out for spending a great deal more public money on a project like this. Unless the Government can get specific assurances about this, I hope that the House will not in any way approve or endorse the proposals today.
3.36 p.m.
Mr. Tom Litterick: To the best of my knowledge, the net accumulated cost to the British taxpayer of our contributions to Common Market institutions—the budget itself, the Coal and Steel Community, and the European Investment Bank—to the end of last year was £1,800 million. That was the

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difference between what we paid to these institutions and what we received back from them in terms of grant. In other words, we come to this topic today in the full knowledge that the cost to the British people of membership of the EEC in straight financial terms is already very heavy, and no doubt 1978 will bring a further tranche of costs.
My remarks do not refer to the other costs in terms of food levies and the consequent additions to the household expenditure bills of the average British family. My hon. Friend asks us today to take note of these apparently innocuous documents to set up this apparently altruistic cultural body, which will cost the British taxpayer another £1 million-plus a year.
It is not hard to understand why we feel just a little sceptical about this, if only on financial grounds. As speaker after speaker has demonstrated, our scepticism deepens as we go through these documents page by page. Nothing that has been said by the Minister or by the right hon. and learned Member for Hexham (Mr. Rippon) has served to diminish that scepticism.
I am puzzled by the proposals for cultural exchanges. Is there a problem here? Everyone is in favour of culture, but nobody is very much in favour of paying for it. I wonder why it is felt that there is a problem, and if so, should it be tackled in this way?
Mick Jagger does not have any problem in moving from here to the countries of Western Europe and back again. Nor does he have any problem in making a lot of money, or in persuading people to pay money to hear him. Andre Previn and his orchestra have no trouble going to Amsterdam, Paris and Berlin, and similarly the Concertgebouw Orchestra of Amsterdam does not have problems coming here. That is cultural exchange and there have never been any problems. It has been going on merrily for many years. It takes many different forms and it is sponsored in many different ways.
The most important aspect of all is the curiosity of the peoples of Europe to visit one another. More than 3 million Britons visit Europe each year. Their idea of Europe is not that of the Eurofanatics—it is not the mini-Europe tucked
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away in the Western corner. It is the whole of Europe. British people make their own decisions about where they will visit and spend their own money. They visit every country in Europe—the real Europe, not just the countries that make up the artificial group in these documents.
That is the most encouraging sign not only of the fact that the British people are outward-looking but that their idea of the Continent, of which they are part, is much larger than the narrow-minded, defensive and rather phobic people of the Community who constantly espouse the interests of this thing called the European Economic Community.
In this connection, speaker after speaker in this debate has suggested that the purpose of these proposals is to make permanent the rather ad hoc propaganda institutions which have existed on behalf of the Common Market for many years and which, for instance, spent such large sums of money in greviously misleading the British people in the referendum two years ago. They want to make it permanent. There is a problem and that problem is theirs, because the Common Market—not as an idea but as an actual living fact—now looks decidedly tatty to British people and very much less significant than it was made to appear two years ago in the referendum campaign.
Therefore, more money has to be spent, so the Euro-fanatics clearly think, to make sure that a pro "little Europe" mentality is developed among the mass of the people. That is the purpose as set out on page 7 of the Commission document. Under the heading "Activities: Youth Work" it says:
"It is of vital importance for the European venture"—
that is the big lie—
"that young people…should…be supplied with better information."
On the next page under the heading "Schools", the document says that there should be:
"a wide range of activities designed to improve teaching on the Community in schools".
We have recently witnessed the attitude of Tory Members on the subject of politics being taught in schools, but they do not regard this as politics. The EEC is some kind of transcendant truth that is above politics. That view is not shared

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by the majority of Labour Members, or indeed by the majority of the British people. The EEC is very much a contentious issue in this country in our politics.
The document goes on to talk about "improving teachers' understanding of the Community." In other words, the teachers are to be programmed as remote control propagandists for the EEC. The money for that will come from us and will be channelled through this Foundation, as it is called.
Later the document mentions research into European integration. I do not recollect anybody talking about that aspect during the referendum campaign, except to say "No, that is not on the agenda, friends and citizens. Please vote "Yes'". This was denied during the referendum campaign. They said—and my hon. Friend the Under-Secretary of State for Foreign and Commonwealth Affairs was one of them—"No, European union is not on the agenda." But here it is—contained in this document in page 12.
Mr. Tomlinson: I still say it is not on the agenda.
Mr. Litterick: I can only suggest that my hon. Friend cannot read or, if he does read that his level of understanding is not very good.
A little further in the document, on page 21, we see a summing up of the purposes of this institution. The document makes no bones about the matter but simply says:
"if the Foundation does its work properly, the end result should be to increase public awareness and involvement in the European venture…our attempts to achieve European union will remain a dead letter unless there is an increased awareness of what the Community means in philosophic and material terms."
In other words, it simply wants us to sanction, on behalf of the British people, the funding of a propaganda agency to further and perpetuate a set of institutions which, thus far, has done nothing to serve the interests of the Britisht people. On those grounds alone—and they are substantial grounds—we should refuse to take note of these ridiculous documents.
3.45 p.m.
The Minister of State, Department of Education and Science (Mr. Gordon Oakes): We have had an interesting
988
debate, although some of the principles underlying some speeches have misunderstood what the House is discussing. I shall deal first with that aspect and with the timing of the debate.
My right hon. Friend the Member for Battersea, North (Mr. Jay) and my hon. Friend the Member for Newham, South (Mr. Spearing) repeated that there was insufficient information before the House and that hon. Members did not know sufficient of what we were talking about. Of all hon. Members, my hon. Friend the Member for Newham, South takes the most meticulous care on any document relating to the EEC. He is right to do so because there are many such documents and they could be rushed through the House without hon. Members knowing anything about them. My hon. Friend frequently complains that documents are not available in the Vote Office, and I agree that it is shocking for the House to be asked to debate a document when copies of it are not available. But that criticism cannot be levelled at these documents.
The decision in the European Council was made in December 1977 and a document signed by my right hon. Friend the Secretary of State for Education and Science was issued on 3rd March 1978. Paragraph 3 of that document states clearly:
"In December 1977 the European Council considered the report and approved the principle of establishing a Foundation. It instructed the Council of Ministers and the Commission to examine the proposal in detail and report back to the European Council."
The contentious document relating to the European Foundation was available to the House on 3rd March and my hon. Friend the Under-Secretary of State for Foreign and Commonwealth Affairs has stated as clearly as it can be stated that what was established at that time was the principle of establishing a Foundation. That is all; and that is all that the Government are asking the House to take note of.
My right hon. Friend the Member for Battersea, North rightly raised questions concerning the details and accountability and I shall deal with those in a moment, but the principle before the House is the principle of establishing a European Foundation. The subsequent running of

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such a Foundation will be a matter for member States and the Council of Ministers to decide.
Mr. Spearing: I was not complaining about the lack of documentation. My hon. Friend misunderstood my criticism. I said that there appears to be a lack of agreement between the Front Benches as to what are the objectives. I regard the memorandum from the Secretary of State as an incomplete description of what was agreed. I have a copy of the deposited document No. 7559 relating to the Copenhagen conference. It includes the words
"to promote a better understanding of the European cultural heritage in its rich diversity and oneness and to further a greater understanding of European integration."
It is clear from this and from the Commission document what the objective was from the beginning.
Mr. Oakes: I was referring to the complaint that my hon. Friend and others made about timing. I was trying to point out that this documentation was at least before the House in March. When my hon. Friend says that there may well be disagreement between the two Front Benches, I can tell him that, judging from the tone of the right hon. and learned Member for Hexham (Mr. Rippon), and from the rather cool response to the document by my hon. Friend the Under-Secretary, and given the remarks I shall be making on this and the other document in a moment, there will be considerable difference.
Mr. Rippon: There is no difference between us. I am entirely satisfied with what the Heads of Government, including our own Head of Government, have done at Copenhagen.
Mr. Oakes: I am grateful to the right hon. and learned Gentleman, whose views I respect. He is a great European and is perhaps much more in favour of Mr. Tindemans' words than I or my hon. Friend would be. But we are not debating what Tindemans said. The concept we are considering and which will emerge from the setting up of a European Foundation might well be markedly different and distinct from anything that Tindemans was proposing in his—to use the word used by my hon. Friend the
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Member for Famworth (Mr. Roper)—lyrical enthusiasm for the idea of European union. So, on the time scale, the facts were available to the House for a considerable time before the debate.
It is always easy for hon. Members to attack my right hon. Friends the Leader of the House and the Government Chief Whip about the timing of the debate. I can assure hon. Members that Ministers do not like debates on a Friday afternoon either. However, the Government always have difficulties in arranging full and lengthy debates on documents, particularly European documents. It is a question of balance. Is it better to discuss the document on a Friday afternoon, when we are reasonably fresh, rather than at midnight, when so many of the European documents come before the House, after a hard day's work by Members?
It was important that the documents should be discussed, and that was the recommendation of the Scrutiny Committee. It suggested—and the Government accepted the suggestion—that the documents should be discussed together, although I agree with hon. Members who have made the point that they present a mixed bag. They do not hang together. This is not one series of documents. The two documents are being debated on a Friday for the convenience of time and the House.
Let me deal, first, with the document on Community action in the cultural sector. It is far less controversial than the document on the European Foundation. The debate was remarkable in that criticisms of the document, many of which I would share, came from those hon. Members who are known either for their commitment against Europe or for their commitment for it. The document contains many proposals, and a number of them do not affect my Department. The cultural and educational proposals affect my right hon. Friend the Secretary of State, my noble Friend the Minister who is responsible for the arts, and myself. But there are other parts of the document for which the Home Office and the Department of Employment are the lead Departments.
The document is a mixed bag which contains many ideas. Some of them are useful. Most of them are already being pursued. Perhaps, as my hon. Friend the

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Member for Farnworth said, supported by the hon. Member for Faversham (Mr. Moate)—two hon. Members who are on different sides of the House and of the European debate—these functions could probably be better done by other organisations, which would be preferable to setting up a specific European organisation. I concur with that.
The other general point that I make is that the system for supporting the arts in this country differs significantly from the system in some other member States of the EEC. In particular, insofar as central Government provides financial support for the arts and crafts in this country, the money is provided by means of the so-called "arm's length" principle. It is for the Arts Council, the British Film Institute, the Crafts Advisory Committee and the directors and trustees of the national musuems and galleries to decide how they shall disburse the money which the Government make available to them.
Individual decisions on which artists and craftsmen, which concerts, plays, operas, exhibitions, theatres, companies and so forth should be supported, and by how much, are left to an independent body of experts drawn from a variety of backgrounds who apply criteria based on professional standards of excellence. This differs considerably from the practice in some other countries, which take a far more interventionist line, where a Government Department is responsible directly for cultural matters and makes payments direct to individuals and organisations in cultural occupations, and where the primary consideration is to put it mildly, not necessarily the quality of the artistic end product.
Mr. Hugh Jenkins: As my hon. Friend has touched on the Arts Council, will he take this opportunity to tell us how he is getting on with the undertaking in the Labour Party's election manifesto to make the Arts Council more democratic and representative of those who work in the arts and in entertainment?
Mr. Deputy Speaker (Sir Myer Galpern): Order. That has nothing whatever to do with the debate.
Mr. Oakes: I bow to your ruling, Mr. Deputy Speaker. My hon. Friend repeats the same question every month. He may be lucky at the next Question Time. I
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shall try to have an answer in time for it. However, it would be improper for me to deal with it today.
Mr. Deputy Speaker: Absolutely.
Mr. Oakes: The document ends with a draft resolution which asks the Council to agree that Community action should be implemented on the basis of the guidelines laid down in it.
What are these guidelines? My hon. Friend the Member for Farnworth said that they were lyrical. If these are lyrics, I should not like to try to set them to music. They represent a heterogeneous collection of proposals, but it is very difficult to discern a common thread other than a loose connection with the cultural sector.
Surely guidelines should attempt to reconcile or at least reflect the different approaches of different member States. There would have to be prior discussion of the philosophical principles involved in State subsidisation of the arts and the reasons for the differences of approach from country to country. But whether any of this is the business of the EEC would have to be settled before such a discussion could be held. My hon. Friend the Under-Secretary of State for Foreign and Commonwealth Affairs has already indicated that the question of the competence of the EEC in this field is not at all free from doubt. Yet, even if the resolution were not agreed, much of the activity on customs procedures, on VAT, on employment programmes, on cultural exchanges, and so on, would continue anyway. Some of this action would proceed in the EEC, but some of it is for the Council of Europe and UNESCO which have a clear remit and considerable experience in the cultural field.
I do not wish to comment on all the points raised in the document, partly because, as I have explained, many of them are already under consideration by other Departments in other contexts. They may affect the so-called cultural sector, however that might be defined, but they also affect other sectors, other workers, other goods and services, and I should hesitate to advance any special pleading on behalf of those engaged in cultural occupations on the basis of arguments put forward in this document.

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However, I should like to say something about public lending right. This matter has been referred to by my hon. Friend the Member for Farnworth, by the hon. Members for Staffordshire, South-East (Mr. Cormack) and Faversham and, indeed, by my hon. Friend the Member for Putney (Mr. Jenkins). Again, this document has had a surprisingly unifying effect, because my hon. Friend the Member for Putney and the hon. Member for Faversham, although bitterly opposed on the Public Lending Right Bill, are at least united in not wanting this proposal. They consider that this proposal could be far worse than anything that the Government have produced or might possibly produce.
The proposal in the document is that public lending right should be harmonised on the basis of the existing schemes in Denmark, the Netherlands and West Germany. These existing schemes differ in some important respects among themselves and they also differ from the scheme which the British Government sought to introduce in legislation, which, as the House will be aware, has been very fully considered in recent sessions but which has unfortunately been obstructed. The Government are now considering the possibility of introducing their scheme on a voluntary, non-statutory basis pending the securing of a statutory basis. The continental schemes are based on different principles. Some are based on purchases of books as opposed to the principle in the Government's proposals of actual borrowings. The sample of libraries on which the statistics are based is very small compared with our proposed sample. Some schemes cover reference books, which will initially have to be excluded from the Government scheme. The collecting and distributing agencies abroad are in some cases semiprivate bodies, rather like the Performing Right Society, while our proposal would be for a public sector body to distribute the payments to authors.
The Council of Europe has recently published a report on PLR which seems to favour the United Kingdom Government scheme. The distinguished rapporteur was my hon. Friend the Member for Warley, East (Mr. Faulds). Also, some other member States neither have
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nor appear to be contemplating any PLR scheme.
A lot of work will need to be done before there can be any serious prospect of harmonisation in this field. Frankly, I consider that the Commission's proposal is wholly premature. I repeat, however, that the Government remain committed to introducing their own scheme at the earliest opportunity.
I hope that in the context of what I have said on this document—before I come to the more controversial document on the Foundation—I have assured the House that this document will not receive an uncritical welcome from British Ministers and officials if and when it is discussed in Brussels. I have noted the various detailed comments of hon. Members. They will provide useful material for such discussions. It remains to be shown that this collection of proposals is necessary or that it contributes anything new or worthwhile to what is happening anyway. To say the least, our stance will be a highly sceptical one.
Now I come to the probably more controversial document relating to the European Foundation. I think that I should begin by describing the present state of negotiations in Brussels.
In her updating memorandum of 12th June, my right hon. Friend the Secretary of State for Education and Science explained that the European Council of 7th–8th April had agreed that the Foundation's seat should be in Paris, and that the Foundation should be set up by means of an agreement between representatives of the Governments of the member States within the Council. Even the exact form of that agreement has yet to be determined, and it is also for consideration whether the Community should be a party to it together with individual member States.
My hon. Friend the Member for Farnworth asked what sort of a body it would be. All I can say to him at this stage is that it seems likely that the agreement will be in the form of a convention, with the possibility of provisional application to enable the Foundation to start work without delay.
As was foreseen in the document, we expect that an initial endowment will be provided to the Foundation from the

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Community budget. We have had an argument and a discussion about Article 235. This matter is uncertain. What is certain is the Government's determination with regard to accountability. En negotiations in Brussels we have been very properly and rightly concerned, as my right hon. Friend the Member for Battersea, North is, to ensure that the Foundation should be fully accountable.
As my hon. Friend the Under-Secretary of State for Foreign and Commonwealth Affairs has said, we are seeking to ensure that there is maximum control of expenditure by member States. We also hope to ensure that the objectives and scope of the Foundation are clearly set out and that the audit procedures are adequate to ensure that the funds allocated to the Foundation are used for the purpose intended. I believe that these points offer adequate safeguards on the question of accountability.
I should like to make a few comments on the sort of thing that the Foundation hopes to do. It is important to remember that there is at present no institution that is responsible for furthering human understanding within the Community outside a Government framework. The concept of a European Foundation, as it has developed, is not a grandiose one. As my right hon. Friend the Prime Minister said—I should like to quote something else that he said—
"There can be no harm, whatever view we may take about the Community, in getting to know the other people of Europe better."—[Official Report, 10th April 1978; Vol. 947, c. 991.]
Surely there can be no harm in promoting human contacts, in promoting human understanding, and in helping to break down any barriers of prejudice, suspicion or misunderstanding. I believe that a Foundation run on modest but effective and controlled lines could have a new and constructive orientation in supporting existing national or bilateral initiatives by voluntary and other bodies, and in giving them a European dimension.
Mr. Jay: In view of what he has said, will my hon. Friend assure me that the Government will not agree to this Foundation going beyond the functions that he has just described—promoting
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human understanding between members of the Community—and that it will have no functions related to what is described as European union or European integration?
Mr. Oakes: If my right hon. Friend will be patient, I was just coming to that point.
I was intrigued by the speech of the hon. Member for Merioneth (Mr. Thomas). His suggestion about minority languages and culture is precisely the sort of thing that the Foundation, which is not a Government body, could well support. I take exception to only one thing he said—his criticism of the Government over their support for the Welsh language. If he looks at what the French Government do in regard to Brittany and Corsica or what other European States do in regard to minority languages, he will agree that this Government are very generous.
Mr. Spearing: On a point of order, Mr. Deputy Speaker. Can you confirm that this business is exempted business and that it can run, if necessary, until 5.30?
Mr. Deputy Speaker: Yes. Of course, one expected not a point of order but a realisation by hon. Members that that happens to be the case. One can judge that, of course, by the length of the speeches. However, each hon. Member can participate only once in the debate.
Mr. Oakes: I come now to the important issue of federalism. My hon. Friend the Member for Putney described the Foundation as a sinister body for promoting a federal Europe. There is no such thing in the document. We need to take a balanced view of the proposal to set up the Foundation. I do not share the enthusiasm that it has aroused in some quarters, but nor do I share the alarmist fears expressed today.
Nowhere is federalism mentioned in these documents. Document R/774, which is the document approved by Heads of Government, talks of such things as social and cultural activities, contacts between social and professional groups and the provision of information on the life of people in Euorpe.

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I do not mind people having information about people in other countries. It is a two-edged weapon. It may lead them to favour European union, or it may lead them to oppose it. But we should never deny people the right to the information on which they can make up their own minds.
We have had a useful debate. I say in conclusion that there is still—
Mr. Hugh Jenkins: My hon. Friend has quoted me on one point, and I thought that he intended to go on. The European Foundation was originally presented to us as an organisation for the encouragement and sponsorship of culture and the arts. My point, which the Minister has not adequately answered, is that it is a propagandist organisation to put over a particular idea.
Mr. Oakes: The point that I have tried to make is that the member States concerned will ensure that it is not a propaganda organisation. It is to give further information to allow people to make up their own minds.
Mr. Jay: Would my hon. Friend allow me to intervene, since he did not answer my earlier question? He is telling us in effect that these documents are not the final description of the nature of this organisation and that the Government will try to convert it into one more in accordance with the spirit of this House. Can he give us a clear assurance—that would satisfy the House—that when the changes which he forshadows have been carried into effect a further document making it clear what the Foundation will do and what its terms of reference are will be brought before the House and that the Government will enter into no final commitment until we have seen that, debated it and taken a decision on it? That would be a fair solution. I hope that he can give that assurance.
Mr. Oakes: It is implicit in what the Under-Secretary and I have been saying about this document, and in our views about accountability, that we shall prevent this from becoming a propagandist organisation. As to my right hon. Friend's second point about another document, I do not know the position about another
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document coming before the House. Hon. Members have opportunities to question Ministers, which is a sufficient safeguard. That should ensure that they can deal with something which is contrary to the wishes of the House.
Mr. Jay: It is surely not treating this House properly to say that some completely different arrangement, of which we have no knowledge, will be agreed by the Government yet to give no undertaking that when this is done it will be brought before the House. I must ask my hon. Friend to say that when these negotiations which he has mentioned have been carried out some document will be brought before the House. It is perfectly fair and reasonable that we should be able to consider and debate it. Will my hon. Friend say that, until this is done, the Government will not commit this country to participation?
Mr. Oakes: I certainly cannot give my right hon. Friend an assurance as wide as that. The Under-Secretary and I have explained to the House the care and control that will be exercised by Ministers to ensure that this Foundation does not become a propaganda organisation. It is primarily a cultural and educational organisation. I therefore ask my right hon. and hon. Friends to take note of the documents.
4.11 p.m.
Mr. George Cunningham: I am a member of the Committee of the European Parliament which has a responsibility for this subject—the Committee dealing with social affairs and education. I can assure my hon. Friends that 99 per cent. of the members of that Committee will be absolutely committed to the idea of using such a Foundation for the promotion of the political concept of European union. That would be true of 99 per cent. of the total membership of the European Parliament as it is now and of any future directly-elected European Parliament.
By all means let the Government commit themselves against the proposition but let no one have any doubts about what the notions in Strasbourg, Brussels and Luxembourg will be. They are determined to use this and any other institution they can create for the pursuit of a

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political end—one which is perfectly legitimate but with which many of us in this House disagree.

Division No. 238]

AYES

[4.12 p.m.

Anderson, Donald

Hampson, Dr Keith

Parker, John

Bennett, Dr Reginald (Fareham)

Harrison, Rt Hon Walter

Rippon, Rt Hon Geoffrey

Cocks, Rt Hon Michael (Bristol S)

Huckfield, Les

Silkin, Rt Hon S. C. (Dulwich)

Davidson, Arthur

Kaufman, Rt Hon Gerald

Tomlinson, John

Davis, Clinton (Hackney C)

Luard, Evan

Weatherill, Bernard

Deakins, Eric

Lyon, Alexander (York)

Williams, Rt Hon Alan (Swansea W)

Dormand, J. D.

Mitchell, David (Basingstoke)

English, Michael

Moyle, Rt. Hon. Roland

TELLERS FOR THE AYES:

Gilbert, Rt Hon Dr John

Nelson, Anthony

Mr. Thomas Cox and

Ginsburg, David

Oakes, Gordon

Mr. Peter Snape.

Glyn, Dr Alan

O'Halloran, Michael

NOES

Atkinson, Norman (H'gey, Tott'ham)

Litterick, Tom

Bell, Ronald

Pavitt, Laurie

Crowther, Stan (Rotherham)

Wise, Mrs Audrey

Cunningham, G. (Islington S)

Jay, Rt Hon Douglas

TELLERS FOR THE NOES:

Jenkins, Hugh (Putney)

Mr. Roger Moate and

Lee, John

Mr. Nigel Spearing.

Question accordingly agreed to.
Resolved,
That this House takes note of EEC Documents Nos. COM(77)600, R/325/78, R/734/78, R/774/78 and R/2982/77 on the European Foundation and Cultural Sector.

STATUTORY INSTRUMENTS, &c.
Mr. Deputy Speaker (Sir Myer Galpern): In order to save the time of the House, I propose to put together the Questions on the three motions to approve Statutory Instruments.
Motion made, and Question put forthwith pursuant to Standing Order No. 73A (Standing Committee on Statutory Instruments, &c.).

STATUTORY INSTRUMENTS, &c.

  SOCIAL SECURITY
  That the draft Social Security Benefits Up-rating Order 1978, which was laid before this House on 25th May, be approved.
  That the draft Supplementary Benefits (Determination of Requirements) Regulations 1978, which were laid before this House on 25th May, be approved.
  That the draft Child Benefit and Social Security (Fixing and Adjustment of Rates) Amendment Regulations 1978, which were laid before this House on 25th May, be approved.—[Mr. Walter Harrison.]
  Question agreed to.
  Question put:
  The House divided: Ayes 28, Noes 10.

STUDENTS' GRANTS
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Walter Harrison.]
4.24 p.m.
Mr. George Cunningham: The subject I want to raise in this debate is that of students' grants, and more particularly the so-called parental contribution to students' grants—that is, the deduction from the grant made according to the income of the parents of the student. More particularly still, the point I am raising is the discrimination which exists in assessing parential income between parents who pay rent for the home in which they live and parents who have a loan for buying a house and who are permitted to deduct from their relevant income the amount of any interest they are paying on that loan.
Before coming precisely to that point, I should like to put to the Minister some anomalies which exist in the arrangements as they are now in order to try to persuade him that the system he is operating, and is generally defending, is one which has many anomalies in it of what I would regard as an unsustainable nature. It is high time that the whole system was looked at in order to try to bring into it a higher degree of consistency and logical defensibility.
The so-called parental contribution is related to the income of the parents. If

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the income of the parents is above a certain threshold, the parent is expected to contribute a certain amount of the excess towards the student grant. The first anomaly to which I want to draw attention is that the scale for that contribution is inverted according to what one would think the natural way of doing it. The threshold of residual income in the coming academic year is, I think, £3,800. If parents' residual income is £3,800, some parental contribution is required. If the residual income is between £3,800 and £5,200, the parental contribution is 20 per cent. of any excess over £3,800. Then we come to a tranche between £5,200 and £7,300 of residual income where the parental contribution becomes only 10 per cent. Above £7,300, the parental contribution of any excess is only 8⅓ per cent.
I am sure that the Minister will agree that on the face of it that is a curious thing in that the person who is at the lower end of the scale is expected to contribute a larger proportion of his excess over the threshold than a person who is at the upper end of the residual income scale. That has not always been the case. In at least the 1971–72 academic year—I think it was the practice generally up to a few years ago—the parental contribution was expressed as a fixed sum, which was small, plus a fixed percentage of the excess of income and that percentage did not vary once the initial threshold was passed. The effect of that anomaly is, of course, that proportionately the systems bears harder upon the person at the lower end of the residual income scale, provided he is above the initial threshold, than it does on the person at the upper end of the residual income scale.
For example, if we have two lots of parents roughly on average earnings, but Family B has £100 more than Family A, Family B will have to contribute £20 out of that excess to the parental contribution. But if we have two other families which have roughly £7,000 a year of residual income, and again one has £100 more than the other, the difference in parental contribution between the two families will be only about £10, or even only £8 if they have a slightly higher income. That curiosity needs to be looked into.
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Secondly, we have the oddity that if there are parents who have two children at college or university, and in respect of the first child the parent is required to make a parental contribution of, let us say, £500, that £500 of assumed expenditure is not deductible in assessing the parental contribution appropriate for the grant given to the second child when he goes to college or university. I would have thought that that was one of the most obvious deductible items to introduce into the system.
Instead, there is a fixed sum deducted. If there are two children receiving grant, next year it will be £95. So, if the parent is contributing £500, he has only £95 allowed as his assumed contribution in respect of the first child. It is even more odd, because, if the parent is contributing to the first child only £50 parental contribution, nevertheless he gets a deduction on his residual income of £95. I do not know who dreamed up that kind of arrangement, but it is hardly defensible.
Then we have the fact that life insurance premiums are deductible, and deductible, I might say, in full, and not as to 50 per cent. of the premiums which is the rule for tax purposes. But why should life insurance premiums be deductible at all, especially life insurance premiums to an endowment insurance scheme? In pure life insurance, the premiums will be so small that it does not really matter what we do. But an endowment insurance scheme can have premiums at a very high level, and such premiums constitute, in effect, savings. They belong not to current revenue activities but to capital activities. Why should they be deductible?
Once again that feature of the system benefits the better off who can afford to have high premiums to that kind of disguised savings scheme, as against the person on average earnings who cannot afford to do so. It means that if a person takes out an endowment insurance scheme and has, say, premiums of £1,000 a year, in addition to getting the tax relief he would have a parental contribution effect which would mean that the real cost to him was considerably less than the notional cost.
I might also point out that, although the Department says that it tries to keep

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these arrangements in line with tax practice, the limit for insurance premiums is one sixth of income in the case of the tax system but 15 per cent. of income, which is not quite the same thing, in the case of parental contribution.
Finally, in the way of anomalies, I am not sure whether the mortgage interest which is deductible is limited to the interest on a loan of £25,000—the limitation which applies in the case of tax relief. As I read the relevant regulations, that is far from clear, because it says on page 28 of the regulations that what is deductible is
"the amount of any sums paid as interest (including interest on a mortgage) in respect of which relief is given under the Income Tax Acts…"
As I read that, it is doubtful whether the interest which has to be deducted is limited to the interest on £25,000 such as applies in the case of the tax system.
It is after pointing out that the system is shot through with that kind of anomaly that I come to the anomaly to which I wish to draw special attention, namely, that in assessing residual income, a deduction is made for interest on a house loan but no deduction is made for rent.
I have been concerned with this subject for about five years, as far as I can see from my files. Over many years, Ministers have drawn a distinction between rent and mortgage interest and suggested that if we were to permit rent to be deducted, there would arise an irrestible campaign to have capital repayments on a mortgage also deductible. I do not think that there is anything in that argument. It is absolute rubbish.
Rent and interest payments are conceptually as near identical as two different things can be. Neither has any element of saving or of debt amortisation in it. Both are current payments for current usage. Both are current payments for current usage of housing facilities. They are identical, whether we are talking about council rents or private rents. I do not think that if we made the change that I propose the Minister would be under any logically defensible pressure to make repayments of capital deductible as well. Also, the Minister's notion that capital repayments are not deductible is wrong—and I shall come to that later.
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I know that the Minister and his predecessors have relied on the Anderson Report of 1958 which considered this matter and which advised the Government of that time against any change in the then arrangements. My answer to that is that it is our duty to look at the arrangements to see whether they are logically defensible, and not look at the recommendations of a Government Committee.
The fact is that we have changed many of the arrangements as they were at the time of the Anderson Report. For ex ample, insurance premiums are now deductible up to 15 per cent. of income and not up to 10 per cent. as was the case at the time of Anderson, and which Anderson recommended should be continued.
Secondly, the system was never terribly close to the tax practices. The whole of insurance premiums are deductible, and not only half as applies in tax. There was a similar arrangement, although not identical, operating to that 50 per cent. rule at the time of the Anderson Report.
The main reason why I would argue against Anderson is that it is a sloppy bit of thinking, if, indeed, one can call it thinking. When the report addressed itself to this subject, this was the mighty advice that it gave, and I quote from paragraph 208:
"We have considered whether rents should also be taken into account, but we have concluded that there is not sufficient reason to make an exception in this respect to the general principle stated in paragraph 203."
That principle was that one should stick as closely as possible to the tax arrangements.
I do not find that a particularly overwhelming or persuasive argument. I do not find it very logical. Therefore, whatever else the Minister does, he should take the Anderson Report and chuck it out the window. It is not persuasive enough and the material is not there to lead us to overturn our own conclusions.
At the time of the Anderson Report all interest was deductible for tax purposes, whatever the purpose of the borrowing. Therefore all interest was deductible for the purposes of assessing the parental contribution.

1005
There has now been a major change in that only interest paid on house loans is deductible for tax purposes. It may have been justifiable not to permit rent to be deducted at that time and to permit mortgage interest to be deducted, not because it was mortgage interest but because all interest was deductible for tax purposes.
The situation now is very different. The proper way to look at this is by agreeing that we now have two different forms of housing payment. Therefore why should one be deductible while the other is not?
The financial effects of the system as it operates now can be put in this way. Let us assume that there are two neighbours, Mr. A and Mr. B, each paying £600 in rent, which is not unusual these days, at least in London. One of them—Mr. B—decided to buy a house on a loan of £8,000 so that he will be paying interest of about £800.
He will find his parental contributions reduced by £160 a year, or more than £3 a week—that is, assuming that both Mr. A and Mr. B are on the low income scale but above the threshold. The actual cost to Mr. B of his £800 of interest will be only £376. In addition to the tax relief on it, he will have £160 knocked off the effect of his parental contribution.
But if Mr. B and his advisers have their wits about them, they can do rather better than that. What they will do is to take out the mortgage on the so-called endowment insurance method. Instead of paying off the capital bit by bit every month, they will pay off no capital during the life of the scheme but will invest in an endowment insurance policy. When that policy matures at the end of the period, the proceeds will be used to pay off the loan.
In that case, if the interest is £800 and the endowment insurance costs £200 a year, total outgoings of £1,000 per year, the effect upon parental contribution will be not £160 but £200. The actual cost to Mr. B in taking on the extra £1,000 of expenditure will be only £470 because of the combined effect of parental contribution and tax relief.
1006
By that means capital repayments are deductible, in effect, so long as the person concerned has his wits about him enough to undertake the operation on the endowment insurance method, because in that case he has deducted not only the interest payments but also the premiums on the insurance policy in total, 100 per cent., provided that they do not exceed 15 per cent. of his income, which they will not. Both the interest and the effective amortisation of the debt are deductible.
Therefore, this system is unsustainable, not only because of that last anomaly, but because basically rent and interest, event if we were only talking of interest, are the same thing. It is current payment or current usage of the same kind of facilities—namely, housing. The present arrangements are particularly hard on council tenants and private tenants on average earnings because of the curious inverted scale to which I referred earlier. The arrangements are also discriminatory even to people not on average earnings but higher up the scale as between all kinds of tenants and all levels of people who are buying their own homes.
I am certain that if the case for and against the present arrangements were fully exposed in the House, with somebody here to listen, there would be a majority in the House who would agree roughly with the case I am putting forward. I suggest to the Minister that it is now time for the whole matter to be reviewed I believe that the Government—whether it be the present Government or the next one—will lose on this matter. The anomaly will have to be removed, and I know that that would be the majority view of the House.
The request I put to the Minister is that Department of Education and Science and Treasury Ministers should have consultations with myself and other Members in the House who are concerned about this matter, so that we can draw up the case for and against the proposals with a view to making the system that we apply more logically defensible than it is now. We should remove this anomaly, which causes a great deal of concern to those who suffer from it and who know the system well enough to realise that it is discriminatory between them and others in essentially identical circumstances.
4.44 p.m.
The Minister of State, Department of Education and Science (Mr. Gordon Oakes): I wish to thank my hon. Friend the Member for Islington, South and Finsbury (Mr. Cunningham) for raising this matter. I assure him that, far from there being nobody in the House to listen to him, there was you, Mr. Deputy Speaker, and myself as Minister responsible for higher education. My hon. Friend made a very persuasive case in the limited time available to him for an Adjournment debate.
Let me try to deal with the regressive effect at the lower end of the scale, and let me take up the point about parents who have two children at university. That is a little outside the subject of rent, and perhaps he will allow me to write to him on that aspect. The main question is whether rent should be deductible in the same way as is mortgage interest. Let me take a few minutes to describe how the system has arisen.
The mandatory student awards system rests on the principle that students should be enabled to attend their courses without hardship, but that the cost of their personal maintenance should be shared between public funds, the students themselves, and, if appropriate, their parents or spouse, according to their ability to pay. Contributions front parents are set at levels that they can reasonably be expected to be able to afford. As a measure of this, for the 1978–79 academic year no contribution at all will be expected where the parents' residual income—that is, the gross income less specified allowances—is £3,800 a year or less. This corresponds to gross pay of around £80 a week.
The awards arrangements, as my hon. Friend is well aware, are administered by local education authorities under regulations made by my right hon. Friend. Clearly, where administration is entrusted to more than 100 local authorities, the regulations must be detailed and precise to ensure uniformity of treatment; and they must also be as straightforward and simple as is consistent with reasonable equity of treatment, otherwise administration becomes unwieldy, costly and inefficient. The regulations must also be demonstrably fair to students and their parents, whatever their personal circumstances. In practice, it is a question of
1008
achieving a balance between what is equitable and what is administratively practicable.
One way in which these two often conflicting objectives have been reconciled is by basing the computation of parents' income, for the purpose of assessing their contribution to the grant, on income tax principles and practice. Thus, the gross income which is the starting point of the assessment is the parents' gross income computed as for tax purposes. Deductions from the gross income to arrive at residual income, on which parental contributions are levied, are allowed only in respect of items which can be allowed for income tax relief. It is for this reason that mortgage interest payments are offset against gross income but rent is not.
The arrangement whereby the assessment of parents' income for awards purposes follows income tax practice is of long standing. It was recommended by the independent Anderson Committee, which my hon. Friend mentioned, in its report in 1960, which forms the basis of the present grants system, but it had been in operation long before that. Over the years, it has been found to provide a logical, consistent and equitable basis for assessing contributions for parents with a wide range of personal circumstances. There is, admittedly, an element of rough justice—that is inevitable when one is trying to maintain a system which is capable of reasonably efficient administration. Nevertheless, the present arrangement has provided the basis for a fair assessment for the vast majority of parents. Over the years, successive Governments have been urged to modify the system to allow for various items not at present covered, or to change it altogether. They have looked at these suggestions, but have concluded that any alternative would be likely to produce more anomalies, not fewer, and to be less fair to parents, not more.
I have a good deal of sympathy with my hon. Friend's contention that rent, like mortgage interest, should be allowable against gross income in assessing parental contributions. We aim to make the system as fair as possible, and I appreciate the argument that there is an element of unfairness here. The fact is, however, that if we were to depart from income tax practice, especially in such a major

1009
respect, we could endanger the system which, as I have said, has been found over many years to produce fair results for most parents. We know from experience that one departure from an established principle leads to others. If we were to accept rent payments as allowable against gross income, we would soon be urged to allow owner-occupiers the cost of repairs and maintenance. As my hon. Friend knows, rent often includes an element for repair and maintenance, as well as mere interest costs. Indeed, in many instances it includes a contribution towards rates as well and therefore the simple income tax system has appeared to be much more administratively convenient and, on the whole, fair.
My hon. Friend rightly said that the full amount of insurance premiums up to a specified limit are deducted, whereas only a proportion is allowed for tax purposes. In other matters of detail, there are minor differences. Some items are allowed for award purposes under slightly different conditions, but these are differences of minor detail only and are nothing like the major departure that he is urging. It is in departing from tax practice with regard to the range of allowable items where the difficulties and dangers lie. I understand that the tax principle is followed on the £25,000 limit. The conditions that apply to income tax would apply to the contribution for a student grant.
So much for the difficulties and dangers involved in moving away from present
1010
arrangements. I would not suggest that these arrangements, in so far as they do not provide for rent to be allowed against income, are wholly unreasonable. I have said, and I repeat, that I have some sympathy with my hon. Friend's argument. I have pointed out that rent and mortgage interest are not exactly parallel. My hon. Friend has not taken that point, but it is often put to me in arguments by other hon. Members and certainly by people outside the House.
My hon. Friend has made clear that, as I said, successive Governments have looked at this system. It is an old system which, in the light of what my hon. Friend said, deserves looking at again in view not only of the anomaly of rent but of the other anomalies that he has pointed out. I say that because, in addition to student grants, we have considered, and will again be considering, the question of post-statutory school grants for the 16- to 19-year-olds. Should they follow student grants or should a new pattern be adopted? In view of what my hon. Friend said today, I think that matter must be looked at.
Therefore, I think that, without giving any commitment—my hon. Friend will agree that I cannot make a commitment now because other Ministers are involved—we should look at some of the compelling arguments that he has put before the House today.
Question put and agreed to.
Adjourned accordingly at nine minutes to Five o'clock.

  JURISPRUDENCE FOR CIVIL ACTIONS
  JURISPRUDENCE FOR CIVIL ACTIONS
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  RAF Personnel (Private Car Use)
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  Tanks
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  Armed Forces (Strength)
ENERGY
  British National Oil Corporation
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ENVIRONMENT
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  Bleached Wood Pulp
  Bleached Wood Pulp
  Bankruptcies and Insolvencies
  Bankruptcies and Insolvencies
  European Trade Mark Office
  European Trade Mark Office
  Romania
  Romania
  Tractors and Combine Harvesters
  Tractors and Combine Harvesters
AGRICULTURE, FISHERIES AND FOOD
  Lamb (Imports)
  Lamb (Imports)
  Pigmeat
  Pigmeat
  Whales (Preservation)
  Whales (Preservation)
  Coypu
  Coypu
NATIONAL FINANCE
  Tax Thresholds
  Tax Thresholds
  Land Development (Taxation)
  Land Development (Taxation)
  Millionaires
  Millionaires
  £ Sterling
  £ Sterling
  Tax Revenue
  Tax Revenue
  Bank Loans
  Bank Loans
  Customs and Excise (Procedure)
  Customs and Excise (Procedure)
  Taxation
  Taxation
  Gross Domestic Product
  Gross Domestic Product
  Public Sector Borrowing Requirement
  Public Sector Borrowing Requirement
  Value Added Tax
  Value Added Tax
  Economic Growth
  Economic Growth
  Government Debt
  Government Debt
  Productivity
  Productivity
  Balance of Payments
  Balance of Payments
WALES
  Dairy Industry
  Dairy Industry
  Youth Opportunities Programme
  Youth Opportunities Programme
  O Level and CSE Examinations
  O Level and CSE Examinations
  Temporary Employment Programme
  Temporary Employment Programme
  Unemployment
  Unemployment
  Roads (Expenditure)
  Roads (Expenditure)
  Employment and Training
  Employment and Training
  Farming
  Farming
  Employment (Young Persons)
  Employment (Young Persons)
INDUSTRY
  Civil Aircraft Programmes
  Civil Aircraft Programmes
  Hull Telephone Service
  Hull Telephone Service
  Investment (Manufacturing Industry)
  Investment (Manufacturing Industry)
  Steel
  Steel
  Investment (Manufacturing Industry)
  Investment (Manufacturing Industry)
  Vickers Ltd.
  Vickers Ltd.
EMPLOYMENT
  Lung Diseases
  Lung Diseases
  Community Industry Scheme
  Community Industry Scheme
  School Leavers
  School Leavers
  Unemployment (International Comparisons)
  Unemployment (International Comparisons)
  Earnings (International Comparisons)
  Earnings (International Comparisons)
  United States Nationals (Oil and Gas)
  United States Nationals (Oil and Gas)
  Work Experience
  Work Experience
  Government Schemes
  Government Schemes
PRICES AND CONSUMER PROTECTION
  Indexation
  Indexation
  Prices (International Comparisons)
  Prices (International Comparisons)
  Prices (Common Agricultural Policy)
  Prices (Common Agricultural Policy)
  Price Indices
  Price Indices

Preamble
The House met at eleven of the clock: The CHAIRMAN Of COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of Rochester.

WALES BILL
Lord STRABOLGI: My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, that the House do now again resolve itself into Committee.—(Lord Strabolgi.)
On Question, Motion agreed to.
House in Committee accordingly.
[The Lord ABERDARE in the Chair.]
Clause 78 [Amendment of enactments]:
The Marquess of TWEEDDALE The Marquess of TWEEDDALE moved Amendment No. 106A:
Page 31, line 16, leave out subsection (2).
The noble Marquess said: Before I move this Amendment, I should like to say—and I say this in order to avoid having another what I can only describe as a deflowered ululation from the Front Bench of the Government as regards our treatment of the Welsh people—that at the moment I have no intention of pressing this Amendment. I do not see why the people of the Principality should be denied this particular subsection. It cropped up in virtually the same form during the proceedings on the Scotland Bill.
I shall ask virtually the same questions as were asked then and I have no doubt that I shall be given virtually the same answers as were given on that occasion. Depending upon one's feeling at the time, I have no doubt also that the Amendment will then be withdrawn and that we shall all depart feeling either miserable or merry. I should like to ask the Minister about the definition of certain words in subsection (2). First, what is the Government's definition of a "Minister of the Crown?" Secondly, can the Government clearly explain to me, as a simple and rather stupid Scot, what is the definition of the words "necessary" and "expedient"? I beg to move.
Lord SKELMERSDALE: My list of questions is not quite so complete as that of my noble friend, but this clause seems to me to embody the most sweeping powers that I have ever seen in a proposed Act of Parliament. I have not studied the Scotland Bill and I do not know what answers my noble friend expects with regard to the debates which occurred on that Bill. However, it occurs to me, after reading subsection (2) of this clause, that the powers are very sweeping.
"A Minister of the Crown may by order make such amendments in any Act passed before or in the same session as this Act and in any other enactment passed or made before the passing of this Act …".
I leave out the passage about such amendments as appear to the Minister of the Crown to be necessary, because my noble friend has covered this point. Surely this includes any Act passed during the current Session of Parliament, including the Wales Act. By order, the Minister may change the Wales Act. We are now on the sixth day of the Committee stage. We had one day for the Second Reading. Without committing anybody to anything, we shall possibly have three days on Report. In one order, a Minister of the Crown may change this Bill when it becomes an Act.
Turning to subsection (3), I gather, although my knowledge of statute law is very limited, that a Statutory Instrument is to be subject to annulment, which means by a Negative Resolution. I should not have thought that this gave very many safeguards to Parliament. If I am right, to allow a Minister of the Crown to alter this Bill when it becomes an Act by Negative Resolution seems to me to be dangerous, to say the least. I shall be very glad to have the Minister's comments.
Lord DAVIES of LEEK: I noticed this point. Although I should not be prepared to go into the Division Lobby, because I do not think that that is necessary, in my opinion—although I do not claim to be a professional—the drafting of this subsection appears to mean that in the case of almost any Act passed during this Session, whether horse-racing or anything else, a Minister of the Crown will be allowed to do pretty well what he desires by way of amendment. I know that the safeguard here is the Negative Resolution procedure.

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Although I do not wish to delay the Committee, because there is much work to be done today, I came here specially this morning to obtain an interpretation of subsections (2) and (3) of this clause. I believe that the Committee is entitled to that interpretation. Although I should not go into the Division Lobby if the Amendment were pressed, nevertheless I believe that this point needs to be clarified. In my humble opinion, some redrafting is required.
11.13 a.m.
The MINISTER of STATE, FOREIGN and COMMONWEALTH OFFICE (Lord Goronwy-Roberts): The purpose of subsection (2) is to empower a Minister to tidy up, behind the Wales Act, by making minor, consequential Amendments to other enactments. Such changes could have been made in the Wales Bill itself, but this course would have necessitated a substantial lengthening of the Bill. Furthermore, it is likely that the scale of such an exercise would have made it impossible to complete it accurately within the time scale of this Bill, and I imagine that we would all aim at accuracy and precision in regard to this Bill, above all.
What is involved here is tidying up the Statute Book after a legislative exercise which covers a huge area—probably the biggest for many years. I am sure the noble Marquess will agree that the approach adopted is the right one; namely, to concentrate in the Bill on the principles and to let the minor detail be carried elsewhere. I would commend to your Lordships that this is very much in line with the recommendation of the Renton Report. I will not delay the Committee by quoting from that report although I have a few apposite quotations to hand. So in regard to both this Bill and the companion Bill, which has already been discussed in your Lordships' House, we shall be acting very much in line with an authoritative and weighty report which makes recommendations to deal with this class of legislation and provision in this way.
The noble Marquess asked me to define the phrase "Minister of the Crown". This designation is well precedented in statutes without, I think, further definition.
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It is like our old friend "may be" or "reasonable" in so many statutes: it is found "reasonable" not to attempt too close a definition of the word "reasonable". Indeed this point was debated at length on the Scotland Bill when Amendments were tabled by the noble Earl, Lord Selkirk. I would myself say that "a Minister of the Crown" covers those Ministers of whatever designation who are normally concerned with the promotion of legislation. Beyond that I think it would be dangerous for me, or indeed any of my successors, or any other Government, to proceed.
The point is well taken, though. There are a number of definitions that we might look at again, including more than one raised by my noble friend Lord Davies of Leek. I ask the Committee to agree with me that we should accept this definition of "Minister of the Crown" as being an operative one in our experience and one which will not cause difficulty in regard to this particular legislation or, I anticipate, future legislation.
The point raised as to the definition of "necessary or expedient" falls into the same category, I fear. I find that in other comparable legislation there appear the words "necessary or proper" with the same purpose. They appeared in the National Health Service (Scotland) Act 1972, the Local Government Act 1972a tremendous piece of legislative provision—and a number of others. I gather that the words there were "necessary or proper",which it did not seem to be necessary or proper to define closely at the time, and I would suggest that the terms "necessary" and "expedient", like "necessary or proper" barely relate to the consequences of the Bill and the Act in question. So what is seen to be necessary to be done as a result of the provisions of the Act as it finally emerges, and indeed what is seen to be expedient, shall, under these provisions, be done.
I fear that I cannot go beyond that in the field of definition, always a minefield for any Minister to enter into. However, there was one other point which I felt was well raised, as to whether this particular Bill would be included in the term "Acts in the current Session". My right honourable friend could not change the Wales Act by order. It is "this Act" and cannot be an Act passed in the same

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Session as "this Act". That is to say, this Act stands on its own apart from the Acts described as being Acts passed in the current Session or, of course, preceding Sessions.
I hope I have made reasonably clear the attitude of the Government on the points raised. I very much welcome what the noble Marquess has said about what I know to be his desire never to diminish the importance of any provisions made for the Welsh people. I hope that our little exchange the other night has not indicated to him that I take anything like an adversary view on this legislation. I welcome also his constructive attitude that he will not press this Amendment and I hope with these few words of explanation he may feel that he will stick to his intention.
Baroness ELLES: Before my noble friend replies, I wonder whether I may put one or two questions to the Minister concerning this subsection. Clearly, it concerns all Members of your Lordships' House as to its effects and particularly of course in relation to the meaning of the last four or five words of the subsection. I say this deliberately because I do not propose to go into the many long arguments that were entailed in the definition of "a Minister of the Crown". It is quite clear that the Government have not been able to do so and apparently nobody else in your Lordships' House has been able to tell us precisely what a Minister of the Crown is or who are the individuals who will be fulfilling that function in relation to Clause 78(2). I presume that it could be anything from about 40 to 110 people, but who exactly they are it seems to he difficult to discover.
I should like to ask the noble Lord what he meant by "minor consequential Amendments". He informed the Committee that this subsection was a tidying up of the Statute Book. The noble Lord, Lord Goronwy-Roberts, and I have discussed many issues across this Table, and I do not, of course, wish to be antagonistic in any way; this is merely searching for the truth as to what this means. What is in consequence of this Act could be merely the actual contents of the Act itself and literally a tidying-up process. But, of course, it could also mean all the
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consequences that flow from this Act coming into force, and this could be indefinite and very considerable indeed.
I would feel very much more satisfied if there was a limited and restricted definition of what "in consequence of this Act means"; namely, that nothing that flows as a consequence of the Act coming into force should be involved in giving powers to Ministers to change any Act of Parliament. As it is worded, I think justifiably anybody could read this in the normal sense as meaning that any Minister of the Crown may by order make any amendments in any Act. The consequences of this Act must be more clearly defined in order to restrict and limit the actions of Ministers of the Crown.
I think it would be very valuable if the noble Lord would be kind enough to expand on this. If not, we might possibly come up with some kind of drafting to restrict it and reassure all Members of your Lordships' House that this is meant to be a restrictive clause. I do not doubt the noble Lord's words; I believe they repeat the words used by the noble Lord, Lord Kirkhill, when this matter was debated during discussion on the Scotland Bill.
The noble Lord did mention the Renton Report, which we debated in your Lordships' House, but I think it is fair to remind your Lordships that that report has never been officially adopted. Although it was debated, and although the contents were admirable and many of us agreed with much that was said, it has no legal status whatever. Although the noble Lord may rightly refer to it, it does not impose any obligations on the Government to fulfill the recommendations set out in that report. I would not accuse the noble Lord of being misleading, but nevertheless the Committee might have been misled by the words he used when he referred to that report. The recommendations in it have never been formally adopted.
The last point I would make is with regard to the question of the form of Statutory Instrument which would follow the order being made by a Minister of the Crown. My noble friend Lord Skelmersdale has rightly pointed out that this is a Negative Resolution, and I

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should have thought that in the circumstances in which any Minister of the Crown may make an order, we would certainly welcome at least an Affirmative Resolution; so that if any matter is raised which seems to be an abuse of the powers of the Minister—it may well not be—an opportunity should be given to both Houses of Parliament at least to debate the issue. I do not say that they will ever be debated, but I think both Houses should at least have that opportunity.
The Marquess of TWEEDDALE: I should like to thank the noble Lord for his reply. Once again, as an ignorant Scot I really cannot quite reconcile the words "expedient and proper". I have done an enormous number of improper things in my life and most of them have been expedient. However, if the Minister can assure us that he will look at this again, I would beg leave to withdraw the Amendment.
Lord GORONWY-ROBERTS: Perhaps I may reply to the noble Baroness before the Amendment is withdrawn. I am really most obliged to the noble Marquess, but I do disagree with him profoundly on one point of very important substance, when he refers to himself as an ignorant Scot. There are no ignorant Scots. I take that as a typical piece of Anglo-Saxon pejoration advanced by a typical Scot.
The noble Baroness raised a number of important points. I think I can satisfy her on the first point she raised. I wonder whether in fact I made it absolutely clear—I thought I did—that these words empowered a Minister to tidy-up behind the Wales Act, in the wake of it, by making minor consequential Amendments to other enactments. There will be consequences, none of them very large but all of them quite important, which need to be attended to as other enactments are considered as a result of the passing, as we hope, of this Bill into an Act. It is that class of Amendment, which is really common form, as the noble Baroness and I know, which is referred to in the phrase "minor consequential Amendments to other enactments".
The second point the noble Baroness made was about the Renton Report. I referred to it as a weighty report; I deliberately did not call attention to its
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recommendations as being those that have been commended in any way authoritatively by Parliament, or indeed by statements of Ministers. The noble Baroness is quite right; it is a weighty report, which I am sure every Member of your Lordships' House has read word by word. I certainly have had opportunity in relation to this Amendment to look at the Renton Report, about which I had heard, and I do find in it a great deal of very useful indication as to how we might more officially in the future relate our proceedings on legislation of this category.
The third point the noble Baroness raised was on the question of the affirmative as opposed to the negative Statutory Instrument. In view of the noble Marquess's decision to withdraw this Amendment, I will certainly take that point for further consideration. I cannot, of course, give the slightest commitment on this, but I do not propose today to argue the case for negativity as opposed to affirmativity. I think—and here I agree with my noble friend—that this constantly needs to be looked at, indeed during the stages of a Bill and in between Bills. It is always a question of the utmost importance. With that indication, but without the slightest commitment, I will indeed call attention to the point made by a number of noble Lords on this. I hope we may be able to accept the noble Marquess's motion.
Amendment, by leave, withdrawn.
Clause 78 agreed to.
Clause 79 [Interpretation]:
11.28 a.m.
Baroness ELLES Baroness ELLES moved Amendment No. 106B:
Page 31, line 39, leave out ("or hydraulic power") and insert ("hydraulic power or water").
The noble Baroness said: I do not intend to take up the time of the Committee debating the issue of water again; it was very fully debated yesterday and indeed before that. I think it should be pointed out to the Committee that the general definition of "excepted statutory undertakers" in the Town and Country Planning Act includes, in Section 290, a good many statutory bodies which are not included in the interpretation clause of the Wales Bill; in particular, water transport, canal, inland navigation and water. I think it should be

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drawn to the attention of the general public that it is the intention of the Government to devolve the powers of water authorities to Wales, and that these water authorities control resources which are of extreme importance and need to other parts of the country besides Wales. I will not elaborate on this theme, but I would like to make this point so that people should be aware that in the interpretation clause of this Bill water authorities of every kind in so far as Wales is concerned are excluded, and that this is going to affect the water resources of England as well as Wales. I beg to move.
Lord SKELMERSDALE: The noble Lord, Lord Donaldson of Kingsbridge, agreed with me the other night that I have a suspicious mind. Perhaps that is not a bad thing when in Opposition, although it maybe more damaging were I sitting on his side of the House—I hasten to add behind him! I go a little further than my noble friend Lady Elles and wonder whether there is any ulterior motive behind the Government leaving out the statutory water companies under this paragraph.
Lord DAVIES of LEEK: Is the noble Lord thinking of something like the Severn Barrage being influenced by this?
Lord SKELMERSDALE: It is possible, but I was not thinking of that specifically.
Lord GORONWY-ROBERTS: I do not want to intervene unduly between the two noble Lords about the Severn Barrage because I might find myself drowning in between them! As the Lord Chairman may recall, the Severn Barrage has always been somewhat of a topic in Wales and I have no doubt in the Welsh Marches as well. I welcome the tone and content of the speech of the noble Baroness, Lady Elles, in formally moving the Amendment. It is true that we have fully debated the issues raised by the Amendment. She has once more quite properly voiced apprehensions—if that is not too strong a word to use—or, perhaps, hopes that the operations of the water authorities concerned will in the future, as they are now, be in the interests of both Wales and England. I have always felt that both countries have an interest in an amicable arrangement about water, the
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source of which is in Wales and many of the users of which are in England. That is the basis on which I think that the very constructive arrangements whereby the two authorities co-operate have gone a great distance to solve what has been a very difficult question in Wales, as many noble Lords and the noble Baroness know. Indeed, I am tempted to say that water in Wales has, in the past at least, been as inflammable as oil in Scotland. One would commend successive Secretaries of State and Governments in dealing with this matter in a constructive way with the result that we have the present arrangements which I need not go into.
The definition of "excepted statutory undertakers" is purely consequential upon what has been determined elsewhere in the Bill. Indeed, the noble Baroness described very succinctly what has been done in the Bill in this regard. The addition of water authorities is, I suggest, clearly inappropriate because ministerial responsibility for their operations in Wales is devolved in the Bill. I think that the Amendment, if it were pressed—I take leave to regard it as a very proper way of reminding the Committee of certain concerns about which I have no complaint—would confuse the division of responsibility between the Assembly and the Government, by involving the Secretary of State in matters for which the Assembly rightly, through the Bill, has full responsibility in other contexts. It would create an additional tier of Government for the matter concerned, and would, I think, inevitably risk friction between the Assembly and the Government.
However, I shall resist, if it is necessary, the Amendment, but I do not object to it at all. Indeed, I think that it is right that we should from time to time remind ourselves as regards the question of water that where the source is in one country of the United Kingdom and a good deal of its use takes place in another, then arrangements must be made to safeguard the interests and the position in both countries.
Speaking as one who lives in Wales and who has lived with this problem all his life, I am very confident that the arrangements that we have evolved over the years in regard to water resources in Wales, their distribution and use, have gone a long distance towards solving what used to be a quite intractable problem.
Baroness ELLES: I am particularly grateful to the noble Lord for that reply, because he has confirmed exactly what I believed; namely, that the existing arrangements are working not too badly. It is precisely for that reason that I am concerned that the arrangements which are at present under the authorities will be devolved to the control of the Welsh Assembly. I do not think that that was what the noble Lord meant to say, but I am particularly worried because concern has been expressed by my noble friends about changing what has already been achieved over a considerable number of years.
As the noble Lord has said, this is a difficult and delicate subject which could concern friction between Border lines—I shall not call them different countries because I consider that Wales and England are part of the United Kingdom, and I do not like the thought of dividing the United Kingdom into specific areas quite so much as the noble Lord, who will rightly feel on his side, that he would like to call them countries. Nevertheless, I am glad that the matter has been raised.
As the noble Lord rightly guessed, I do not intend to press the Amendment. However, I express a reservation and regret that the good co-operation that has been evolved over the years on this subject should now be put again into the political field and possibly be used as a political football between the two neighbouring and adjacent territories. I beg leave to withdraw the Amendment.
Lord GORONWY-ROBERTS: I am sure that we would all agree with the general tenor of what the noble Baroness has said. However, I wish to insert a caveat: nothing immediately would recreate the acerbity of this issue more than to take away this provision from the Assembly and give it back to the Secretary of State. There may be arguments such as the ones which the noble Baroness has advanced, but I would, in a bypassing manner, strongly advise against any such move being made.
Amendment, by leave, withdrawn.
Clause 79 agreed to.
Clause 80 agreed to.
Clause 81 [Referendum]:
11.38 a.m.
Lord ELTON Lord ELTON moved Amendment No. 107:
Page 32, line 43, at end insert—
("(4) If a resolution under section 80(4) above has been moved in each House of Parliament, but has not been passed by both Houses, the Secretary of State shall lay before Parliament the draft of an Order in Council providing for the repeal of this Act.").
The noble Lord said: Clause 81 relates to the referendum and the machinery that is to be put into operation according to whether the referendum gives one answer or another. The effect of the clause as it stands is that if a resolution were moved under Section 80(4), but not passed, the terms of this Bill—or this Act as it then would be—would not be put into effect, but the Act (as it then would be) would remain on the Statute Book. Therefore, this is not an Amendment of profound importance in terms of the political effects that it would have after a referendum. But it is a Parliamentary housekeeping and tidying-up operation to remove from the larder, as it were, food which became so stale that it was inedible. The Statute Book is already too full and anything that we can do to thin out the contents of the pages would in my view be welcome. I beg to move.
Lord GORONWY-ROBERTS: An almost identical official Opposition Amendment to the Scotland Bill was carried on a Division against the Government's advice during the House of Lords Committee stage. We accept that this House has already decided in a Division that a similar provision should be inserted in the Scotland Bill. Therefore, we are ready to accept this Amendment, so far as this House is concerned.
Lord ELTON: I am grateful to the noble Lord for making that concession. Of course, I know that he always has to make these sad reservations. It is nice when is he able to make an acceptance wholeheartedly. None the less, we are glad to be able to press this Amendment without a Division.
Lord WIGG: I should like to express my pleasure at the Government having accepted this Amendment because perhaps it shows the way in which the wind blows. When the Scotland and Wales Bills are returned to another place, I hope that

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another place will accept a great deal of what this House has done.
I should like to express the view that, although both Bills are not had Bills, they are unworkable Bills. They will create more trouble before we have finished. But I am a democrat and therefore will accept the decision that is taken. However, equally, the Government should be willing to accept the democratic process. I am delighted that if the referendum goes against them, the body will not be left about unburied; that they will then accept this and the slate will be wiped clean. I do not suppose that one can wipe slates clean with bodies, but the noble Lord will know exactly what I mean. I am grateful to the Government for accepting this, but I am even more grateful because I think it shows that the Government have learned a great deal during the passage of these two Bills through this House, and that perhaps is a good thing.
On Question, Amendment agreed to.
On Question, Whether Clause 81, as amended, shall stand part of the Bill?
11.43 a.m.
Lord ELTON: I should like to slip in an observation here, although I am not absolutely certain whether I am doing it at the right place. There has been a discussion on the Scotland Bill about the date of the referendum and the desire that there is, I think on both sides of the Committee—certainly on this side of the Committee—that the referendum for Scotland should be held on the same day as that for Wales. Unless the noble Lord, Lord Goronwy-Roberts, shows an unexpected reluctance to take the point that I am making, I do not think it will be necessary for me to elaborate the reasons for that. I think that it would be fairly apparent on reflection by your Lordships that it would be a mistake to have the referenda consecutively and, what is more, very difficult to decide which should be held first. Those who are in favour of devolution would favour one order of batting and those who are against it would no doubt favour another, hoping that whatever result they expected in one forum would influence that in the other.
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As I understand it, the argument at this point in the Scotland Bill resolved itself upon the point that we cannot include in one statute a provision which is dependent upon the passage of another. That is to say, in this Bill we could not place a requirement that anything to be done under this Bill should be done at the same time as something was done under another Bill, when that Bill is a Bill and not an Act, because it is assuming what we all, in fact, take as a valid assumption—that both Bills will be enacted. However, that is an assumption which I understand the legislative conventions of this country deny us. If that is the case—and the noble Lord will confirm, no doubt, whether or not it is—it would be very useful for those of us involved in this debate and not in the other to have from him now or at a suitable later stage—preferably now, if it is possible—an assurance that it is the Government's intention to hold the referenda or referendums (I am never sure which is the correct usage) on the same day.
One could embark upon various stratagems which would allow the time elapsing between, let us say, the Parliamentary vote, and the passing of an order to he the same in each case. But whichever way one tries to do it, there is always what I would call a "slippage" if one is not allowed to refer to the other Act. I should have thought that we would be much better advised to rely upon the good faith of the Government if they are prepared to give an undertaking on this during the passage of this Bill.
Lord WIGG: I support the point of view put from the Opposition Front Bench. The argument used on the Scotland Bill was that the Government could not accept it because they could not be quite sure that the Wales Bill would be passed. But now that it is reasonably certain that both Bills will reach the Statute Book, I should have thought that the Government's categorical assurance on this point—that so far as possible the referenda will in fact be held on the same date—would be wholly satisfactory.
Perhaps the Minister will allow me 30 seconds to put what might happen if for some reason the referenda were taken on different days. Obviously, the result

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of the first must influence that of the second. Therefore, from every point of view, I should have thought that the Government would wish to be fair and would wish to be seen to be playing fair. I would accept an assurance given from that Dispatch Box that that will happen, which would be wholly satisfactory.
Lord SKELMERSDALE: On the point of the referenda, particularly the referendum as it pertains to the Wales Bill, can the Government either confirm or deny a report in the Western Mail earlier this week which suggested that an up-to-date register of electors would not be available until mid-February? That report suggests that an up-to-date register would be absolutely essential in order to get a true reflection of the 40 per cent. figure.
Lord GORONWY-ROBERTS: The central point raised by the noble Lord, Lord Elton, and, if I may say so, powerfully reinforced by my noble friend Lord Wigg, was on the question whether the referenda—and whatever the correspondence columns of The Times may say, the noble Lord, my noble friend and I are quite right in referring to them, in the plural, as "referenda"; we can argue about the respective merits of gerunds and participles later—would be held on the same day. It is the Government's intention that both referenda should be held on the same day. Indeed, the arguments for this have been very succinctly put by my noble friend Lord Wigg. It is not necessary—indeed, it may be inexpedient—to make statutory provision on this point. However, as my noble friend said that he—and I imagine the noble Lord, Lord Elton—would accept the Government's assurance on this point, I am able to give the assurance that the referenda will be held on the same day. I cannot conceive of circumstances—except the failure of the passage of one Bill or its delay, which, as my noble friend has pointed out, hopefully, and I believe precisely, will not happen—that would in fact interfere with that intention.
As to the question raised by the noble Lord, Lord Skelmersdale, I think that to some extent it was a repetition of that point. I hope that I have covered the nuance of what he raised; if not, perhaps he would repeat his point.
Lord SKELMERSDALE: No, I do not think quite so. I understand that the register of electors is not precisely up to date and that a new register will not be ready until next February. A new register is apparently essential for calculating the effects of the 40 per cent. figure which is referred to elsewhere in the Bill. Could the Government either confirm or deny this fact?
Lord LEATHERLAND: As one who has had a very great deal to do with electioneering and the organisation of elections, I think there is a good deal in the point which the noble Lord, Lord Skelmersdale, has made. The new register, which will be canvassed in October, will not be printed or come into operation until about the middle of February—that is the usual thing. If, unfortunately, we use the old register, we frequently find that 20 per cent. or 30 per cent. of those on the old register have died, emigrated or moved to another part of the country. Therefore, to have a poll of any kind, or referendum, before the middle of February would be very unreal and dangerous indeed.
Lord GORONWY-ROBERTS: I apologise to the noble Lord for not having replied to him. Frankly, I could not read my own handwriting. It is the normal Parliamentary register of electors which will be used for the referenda. If the referenda are held before February 1979 the February 1978 register will be used. This is normal practice in elections, including General Elections, and indeed by-elections. To some extent it is possible for Governments, without being offensive to regulations or to public opinion, to time elections in order to put them as close as possible to the effective, fullest, most comprehensive register, but it is not always possible, as we all know in all Parties. I am afraid there is no way in which we can manage this one. The last effective register would be used for this purpose. I take note of what my noble friend Lord Leatherland has said. He has experience of these things, and I agree with the general purport of what he said. Nevertheless, this is the situation. We have to proceed as we do with other voting processes on the basis of the last effective registration.

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Reference was made to that excellent daily newspaper the Western Mail; that it carried a report to the effect that we heard. I almost always read that the Mail has to say with great pleasure and the fullest credulity, but sometimes, as I said the other day, even the Welsh Homer nods. I am not saying that this happened in the case of the Western Mail. I think that is a fair point. They were canvassing the need to bear in mind that the more recent the register is, the more effective and the more comprehensive the expression of opinion can be. But I am afraid that we cannot help in this matter because of the circumstances I have described.
Lord DE CLIFFORD: Might I ask the Government to think again? The noble Lord is treating this as a matter of a General Election. This is not a General Election, this is a major constitutional change. It is absurd to me that it should be treated as a normal election, and that we should take a chance on whether the old register is going or not. This is a case where we want to make it right up to date, and I wholeheartedly support my noble friend.
Lord ROBBINS: Might I add a footnote to what the noble Lord who has just sat down has said. It seems to me that the requirement as regards the percentage of the electorate removes referenda of this sort from the logic which is applicable to General Elections.
Lord WIGG: Surely it is not a question of using logic; it is in fact a question of mechanics. Those of us who have engaged in a number of elections—and, for my benefit, I have—know only too well the splendid work which is done by the registration officers throughout the length and breadth of these islands, but it is not an easy task. It makes a great demand upon the registration officers' staff. The idea that this measure could reach the Statute Book by the end of July, and that the machinery could then be devised—I think it would require legislation, in any case—and that you could compile a new register for the specific purpose of the referenda, seems to me not really "on".
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What we are discussing on this Amendment is not the actual mechanics associated with the preparation of the register; we are discussing the simple point that the referenda should be held in Scotland and Wales on the same day. That is very important. We have an assurance from the Government on that point. Let us he satisfied with that. If there are noble Lords who think that the Government should be directed to hold the referenda immediately the new register comes into operation, that would be an Amendment that could be considered on Report, hut it is not applicable to the matter we are now discussing.
Lord ELTON: With respect to the noble Lord, Lord Wigg, who has been most helpful in this debate, we are not discussing an Amendment at the moment but whether the clause shall stand part, and therefore we can range as we wish. He has suggested a way out of the difficulty which could be put in concrete terms at Report stage. I am obliged for that thought, and we might pick it up. I accept the point made by my noble friend Lord de Clifford that this is a matter of considerable importance, and I would much deplore any tactics, or decision, by the Government which would lead to this referendum campaign being directly analogous to an election campaign. It should not be an issue between the Parties as they are aligned on other matters, but between the Parties as they are aligned on the specific matter of devolution.
There is a large area of coincidence with the Party main line policy, it is true, but I think that if that were to lead us into a sort of electioneering approach in I which the "Ins" took one view and the "Outs" took another as a result of the fact that this House and another place are constructed in such a way that that is almost the only way the argument can be conducted while we are discussing what should go on the Statute Book, that would be a great pity. If this is the intention of the Government—and I must say that some of the events occurring in Wales at the moment lead me to suppose that it may be so—the use of the media seems to he geared to a political approach directly in line with Party alignment. This may, or may not, be inevitable. I hope that is it not.

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It leads me to mention to your Lordships another matter which has of late concerned my noble friends and myself increasingly, and that is the lack of an assurance when it was sought on the Scotland Bill that the very large resources of the Government in terms of Civil Service manpower, printing, publication, and so on, would not be used in order either to advance or oppose the cause of devolution. At some stage in our debates on this Bill we should like from the Government a statement as to whether or not they are going to go into Wales bearing the Act in one hand and a Manifesto in the other seeking people to vote for it, and using all the engines at their disposal, as Her Majesty's Government, in order to do so; because that would put an entirely different complexion on the debates we are having now, and we ought to have notice of it before we conclude the process on this Bill.
Lord WIGG: I do not disagree with one single word of the noble Lord, Lord Elton, except to correct him on one point. I was not replying to noble Lords on the other side of the Committee in terms of points of order. What I was anxious to establish is that he has got something; and I am glad he has got it, and I pay tribute to him for getting it; but having got it I do not want it to get hidden away by this discussion of another fundamentally important subject. I took exactly the same line as he did. I am doubtful about the media, and indeed I have my doubts about the Government. I am sure that my noble friend Lord Goronwy-Roberts does not want me to defend him, but he was making a point in comparison with a General Election—that, whether this House or another place like it or not, the mechanics connected with the preparation of the register are such that it has to be fought on the same register on which a General Election would be fought for precisely the same reasons, because there is no alternative.
With respect, the suggestion that I make to noble Lords opposite is that, if they wish to tie up the Government—for which they would certainly have my support, for what use it would be—let us put down an Amendment at Report stage to insist that the Government call the referendum, say, within reasonable time of the coming into force of the new
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register. That is the only way that it can he done. It cannot be done the other way round. One cannot imagine that at this stage in the game the Government can be forced—even if they had the will, which I doubt; and to say nothing of the expense involved—to institute proceedings to draw up a new register. That cannot be done. Therefore, let us take what we have and be grateful for it, and let us return to this matter at the Report stage, not necessarily on the lines I suggest, but in a way which we think would be practical.
Lord LEATHERLAND: This seems to be leading into a lengthy debate. The real point at issue was whether the referendum would be conducted on an up-to-date register, or on a register which was 11 months out of date, and which consequently would contain the names of a large number of people who had died, or who had removed. Having, like the noble Lord opposite, read the newspapers, it occurs to me that this matter may probably settle itself. The referendum is not to be held until three months after the General Election. The new register will be out by about the middle of February. We understand that the General Election will he held in October—perhaps my noble friend can confirm that. If three months are to elapse after the General Election in October, that would leave several weeks before the new register would come into operation, and therefore the referendum would be conducted on the new register which would be issued in the middle of February.
Lord SKELMERSDALE: I do not know whether the Minister wishes to answer at this stage, or whether I am allowed to put a further point. It seems to me that one cannot consider legislation on the assumption of a General Election, and therefore I think that the point made by the noble Lord, Lord Leatherland, is perhaps to be discounted. The point I was trying to get at—and which I do not think has been raised at all—is that the population of Wales is, I understand, approximately 2½ million. I would guess that of that total about 1½ million, or 1¼ million, are on the current electoral register.
The noble Lord, Lord Leatherland, with his great experience, has said that there may well be a difference of 30 per

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cent. one way or the other between a new register and an old one. If less than 40 per cent. of the electorate—on whichever register is chosen, and which happens to be in force at the time of the referendum—fail to vote in favour, the Secretary of State shall lay before Parliament the draft of an Order in Council for the repeal of the Bill, after it has become an Act. If there is an out-of-date register of electors, surely from that point on there will be tremendous arguments in Wales as to whether in fact the referendum gave a fair answer to the question that was posed. Therefore, in my submission there must be a register of electors which the Welsh people will see to be fair at that particular time. If there is an out-of-date register—even if it is only slightly out-of-date—the Welsh people will not see it as being fair, and they would be arguing from then until the next time that devolution is raised in a Bill in this House or in the other place.
Lord CROOK: I should like to suggest that we discuss this matter at the right time and the right place, which is in relation to Schedule 12, when we get to it.
Lord COLLISON: I wish to say what I thought the noble Lord opposite was going to say, because I think that this ought to be said. If the referendum is carried out on the basis of the old register, and 20 per cent. of the people are no longer on it, then, if my mental mathematics are right, instead of requiring a figure of 40 per cent. of the total electorate one would be requiring 50 per cent. I felt that I should make this point, not to argue it one way or the other, but merely to enable it to be considered.
Lord PARGITER: I believe that this question could be fairly easily settled if someone was to propose a particular date. The date 1st March could be proposed, if wished. There is no reason why that should not be inserted in this Bill or in the Scotland Bill.
12.6 p.m.
Lord GORONWY-ROBERTS: As the noble Lord opposite mentioned, this is a general discussion, and so anything goes which is relevant to the provisions we are considering. I am once more
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most obliged to my noble friend Lord Wigg for putting the matter so well. There is no intention to equate this voting process—and I believe that I earlier used the phrase "voting process", as well as "elections"—with any election, even a General Election. However, the comparison, in general terms, for the purposes of explaining the difficulties of the mechanics involved, is I believe apposite. Therefore, to raise a great heat about whether we are to treat this as a general Election is a little misplaced. There is no intention to treat the referendum as an election. It is not an election; it is a test of opinion. As to its becoming an adversarial contest between the Parties, —and by now I know Wales almost as well as the Opposition Front Bench—I submit that every Party is split, to some degree or other. My noble friend Lord Lloyd of Kilgerran, who knows Wales so well, would agree with me. I have met members of Plaid Cymru—the Welsh Nationalist Party—who have said that they propose to vote against the Act in the referendum. Thus, to some degree or another, all Parties are split on this question, as, to a very great degree, all Parties were, I think, split on the question of our retaining membership of the European Economic Community.
Therefore, I see no likelihood of the usual kind of partisan acerbity about this. There will be great argument; there will also be argument within Parties. But the Government's position is clear. This is part of our Manifesto, part of Government policy. We have gone to great lengths to keep our pledge to the people of Scotland and Wales that we would introduce devolution Bills. First, we brought in a Bill covering both countries, and in the light of Parliamentary comment and experience we divided this into two. In so doing we have—whether rightly or wrongly is a matter of Parliamentary opinion—devoted much time and energy to implementing the pledge that we would produce devolutionary measures. We have done so; here they are. They are to be put to the Welsh and the Scottish people for a test of their opinion, which Parliament, by means of the processes described in the proposed legislation, will then consider. The processes which will follow after that are well known to your Lordships.

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With regard to how that test of opinion can best be held, I agree that it should he conducted as soon as possible after the latest, most effective register is available. There is a law of diminishing returns about this. My noble friend Lord Wigg spelled it out. There is this fact of life in connection with any voting procedure, whether one describes it as an election or a referendum. Unless provision is to be made for the preparation of a special register because of one situation which is deemed to be special—and once there is one special case, everything becomes special—then it is necessary to organise it in the best way possible, as is done with other processes of voting. If the word "election" is obnoxious I shall not use it. As I said, this must be organised in the best way possible, as is done on other comparable, though not identical, occasions in relation to the best, the latest, and the most comprehensive register available.
The noble Lord is again right; there are stages still awaiting this measure at which some Amendments may be made. I cannot say that the kind of Amendments which I think may be made will receive more practical favour—and it is a matter of practicality more than anything else—than I have indicated in the tone of my remarks; but Parliament is free to do this. Your Lordships' House is free and the other place is free to consider at some stage whether they would put down such an Amendment, or indeed the kind of Amendment we have heard suggested by my noble friends who have taken part in this debate. This is a matter for Members of either House or both. Houses to consider, and it will be a matter for the Government to decide their attitude if such an Amendment is tabled.
I pass now very quickly to points raised by the noble Lord, Lord Elton, who asked me to give assurances on certain matters. I can assure him that it is not the intention of the Government on this occasion, differently from the occasion of the test of opinion on the permanency of our membership of the Community, to put out publicity material. This, I think, was made clear in the debates on the Scotland Bill; and there are no plans for an explanatory leaflet. I do not know; there may be views about this which may well be expressed, but that is the Government's
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position. I have reminded the Committee that it is a manifesto pledge, and therefore the Government, despite the fact that not all their supporters in Wales or Scotland may agree with them on this point, will of course put forward clearly and strongly their view as a Government, very much as they will put forward their view on other appropriate occasions about their support for their Budgetary proposals, or any other proposals.
Lord ELTON: It might help if I asked for clarification at this point. I do not quite follow the congruence of the two statements: one, that there will be no commitment of Government resources to persuading the electorate any more than there was on the European referendum; the other, that the Government would give all their energies to persuading the electorate that they ought to support the Act that they have brought on to the Statute Book. That is how I heard the noble Lord; I may have got it wrong.
Lord GORONWY-ROBERTS: If I may make it perfectly clear, we shall campaign for it as a Government mindful of the fact that not all of our supporters in either country support this. The great majority do, but that is another matter. What I said was that we have no plans for an explanatory leaflet anal3gous to the one which was issued by the Government in relation to the Community referendum. Nor do we intend to put out publicity material on those lines. In fact, the Government will campaign (once more I have to use the analogy of an Election) as if it were an Election; that is, they will advocate this, he in favour of it, very much as they would advocate the adoption of the fiscal Bill on Budgetary matters, or any other.
Perhaps I can help a little further if I say that we shall not make funds available, as we did in the referendum on the Community, for campaigning organisations. There may be varying views about this; there were at the time when we discussed this provision for campaigning organisations for the purposes of the Community referendum. We shall not do it in this case; and I see no evidence of a proposal to make this provision by Amendment to the extant Bill, either in this House or, so far as I know, in the

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other place. That is as far as I can go today on the assurances to the noble Lord. It may well be that what I have said can be amplified or further reinforced at a later stage, but it is enough to go on with, I hope.
As to the point made about the media—and here I would listen with particular respect to my noble friend and, indeed, to the noble Lord—it is to he expected confidently that the media (the Press and the broadcasting authorities, both the BBC and the IBA) will themselves seek to make such arrangements that give equal, full opportunity for all views, all substantial views, to be expressed. It cannot, of course, provide for endless eccentricity, but there are definable attitudes within the noble Lord's Party—some very interesting ones, about which I personally, as an assiduous listener and viewer when I get the chance, would like to hear more. It is for the authorities, without too much formalisation from on high, to make these arrangements. We shall be told of the arrangements, and no doubt noble Lords and others who know a good deal about this will be watching how these arrangements emerge. There will be plenty of opportunity to check, to comment and to urge, perhaps, adjustment and improvement. I think I have covered most, if not all, of the points which have been raised in this rather Second Reading debate, which I welcomed. If I have missed out any point of substance, I am sure the Committee will allow me to write to the noble Lord concerned upon that point.
Clause 81, as amended, agreed to.
Schedule 12 [Referendum]:
12.15 p.m.
Lord ELTON Lord ELTON moved Amendment No. 107A:
Page 86, line 30, after ("day") insert (" , not less than six weeks after the making of the Order,")
The noble Lord said: My own print, unfortunately, does not carry Amendment No. 107A, and therefore your Lordships will bear with me a moment while I repeat the contents thereof, which refer to page 86 of the Bill and the insertion in line 30, after the word "day", of the words, "not less than six weeks after the making of the Order". The purpose of
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this Amendment is to establish what is in fact to be the length of the campaign. I am sorry to have taken so long to specify what was the purpose behind the Amendment, which must have been clear to the noble Lord before I actually spoke to it. I beg to move.
Lord GORONWY-ROBERTS: We are in the mood of concession today—reluctant, but nevertheless effective concession. This Amendment is identical to one made earlier this week to the Scotland Bill, of course. The Government believe that the Amendment is unnecessary and introduces an unnecessary degree of inflexibility; but, as your Lordships have seen fit to write the provision into the Scotland Bill, we are willing to accept it in the Wales Bill so far as your Lordships' House is concerned.
Lord ELTON: I have observed before the frequence of the qualification of the noble Lord's generosity. I noticed that it was absent, when we conducted the whole of our exchanges on the Question, Whether the last clause shall stand part, as to the possibility of his Government not being in office to honour the pledges that he was giving. But, of course, that is only a gibe at the noble Lord. I am grateful to him, none the less.
On Question, Amendment agreed to.
12.17 p.m.
Lord ELTON Lord ELTON moved Amendment No. 108:
Page 58, leave out lines 5 to 9 and insert—
("Mae'r Senedd wedi penderfynnu ymgynghori gyda etholwyr Cymru ynglyn a ddylid gweithredu Deddf Cymru 1978.

A YDYCH AM I DDEDDF CYMRU 1978 GAEL EI GWEITHREDU?
Put a cross (X) in the appropriate box Rhowch groes (X) yn y blwch pwrpasol

YES YDWYF

NO NAC YDWYF

").
The noble Lord said: This Amendment is marred by one defect, and that is that it contains a small printing error. Your

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Lordships might think that my minimal knowledge of the Welsh language would make it impossible for me to draw attention to it, but it so happens that it occurs in the letter "a" where it stands on its own in the second line of the Amendment. It should be marked with a circumflex, as I am sure the noble Lord, Lord Goronwy-Roberts, will have already realised.
I will not attempt to read out the Amendment. There are other noble Lords who will be able to do that for us. I do not wish to give the noble Lord the satisfaction of hearing me struggling, with increasing perplexity, with something which is beyond me. What I do wish to tell your Lordships is that this Amendment has the effect of requiring that the ballot paper presented to the Welsh people to decide their own destiny, recognising that these people are very sensitive about their language, shall be printed in both English and Welsh.
I daresay that I shall be told that if this Amendment were not in the Bill it would none the less be printed bi-lingually as a result of the effects of the Welsh Language Act or other legislation. However, it seems to me that to put it into plain English in this Bill, throughout the whole document, lacks a sense of occasion We have to drag our feet on the passage of the Bill, for reasons which I have tried to explain somewhat ineffectively and noble Lords opposite have managed to exploit somewhat effectively. We must be in a position of opposition at every stage so as to elicit the ground the Government stand on when they make a provision in the Bill. Sometimes we agree, sometimes we do not. But, at bottom, this is a great historical occasion, a great question to be put to a great people. If they answer, "No", the occasion will die away in echoes in the history books If they answer, "Yes", it will become a very principal document—not exactly a Magna Carta but a document which marks the opening of a new constitutional stage in the history of the Welsh people. It seems to me to lack a sense of theatre not to put the question in the Bill in the language which the Bill is principally concerned to defend. I beg to move.
Lord SEGAL: As one who is wholly in sympathy with the terms of this Amendment, I confess that I find myself in some-
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what of a difficulty as regards the form of the voting paper. The voters are asked to say, "Yes", which in Welsh is, I suppose, Ydwyf. But for "No", they are asked to vote Nac Ydwyf, which means "Not yes". Surely there must be an enormous area between "Not Yes" and "No". Although I, too, confess to a minimal knowledge of the Welsh language—it is certainly an easier language than Chinese, but I believe, rather more difficult than Greek or Arabic—I simply ask this in a desire for enlightenment: "Not Yes" could conceivably include a wide category of the "Don't knows". Certainly, it is totally different from saying an absolute "No".
Are not the Government or the movers of the Amendment finding themselves in the predicament of the girl in the adage: "She wouldn't say 'Yes': she wouldn't say, No?—and all that she did say was "Not Yes!". Is the Welsh language, with its mellifluous and musical lilt and beautifiul flexibility, not capable of declaring—I ask out of complete ignorance—a very emphatic and categorical "'Molotov' No!". So that the voters will have no doubt in their minds as to which direction they intend to declare their voices on this major issue?
Lord ELTON: On this important point, this is the way in which the Welsh declare a categorical "No"! It is just as categorical—and I see that the noble Lord opposite is about to correct me. I understand that Nac Ydwyf is how you say "No". It is so in my elementary textbook and appears to be satisfactory to the very literate people whom I have consulted and who had vetted what appears on the Marshalled List. If the noble Lord thinks there is an area of indecision here, I would ask him to reflect on the area of indecision which must rest on him and his colleagues if they choose to go into the "Not Content" Lobby; for we express ourselves in this House in precisely the same way as the Welsh, without any difficulty at all, and we all know what we mean.
Lord SEGAL: Certainly, we enjoy a more decided advantage than the unfortunate voters who have to decide one way or another—or even the people in the other House.
12.26 p.m.
Lord GORONWY-ROBERTS: May I at once make the point that, as in the case of the Community referendum, which provided for a ballot paper and for a Welsh variant of the question in this way, it was not necessary then to include it in the actual Bill but rather, because of the availability of Section 2(1) of the Welsh Language Act 1967—in the preparation of which I had some small part—the thing flowed naturally in regard to the referendum procedure in 1976; and this is the way it will happen in regard to the referendum on the contents of this Bill in Wales.
I appreciate the purpose of the Amendments, and everybody in Wales will commend the noble Lord and his colleagues for their practical concern in providing that this question—"a great question put to a great people", as he put it so felicitously—shall be in both languages. Some quarter of us- some half a million or more—regard the language as the normal language of our thoughts and decisions in many areas, and this is a necessary provision. But it should be made, I think, through the processes we have already used in regard to the only other referendum that I can call to mind since the Welsh Language Act was passed in 1967; that is, the Community referendum. The Welsh Office are in the process of preparing a rendition of this kind which comes very close indeed to that proposed by the noble Lord. We are overwhelmed by this evidence of Celtic erudition and enthusiasm, and we shall certainly make full avail of it.
As to the point raised by my noble friend, I think he is quite wrong about this. He made quite a long speech based on his own translation of the negative proposed in the formalution moved by the noble Lord: that it means "Not Yes". It is nothing of the sort. The affirmative in Welsh, "Ydwyf", means "I do". It is a clear affirmative: "Do you?—I do". I am beset by erudition from both sides of the House. The negative is "Nac Ydwyf"— "I do not". What could be clearer than that. "I do—I do not". Indeed, it is the alternative formulation to the answer to perhaps the greatest question ever put in our lives to those of us who are married: "I do!" or, very
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rarely, "I do not!". It is clear, it is definite. I cannot imagine anything more un-Welsh than what my noble friend suggests: "Not Yes". This is new to me, in either English or Welsh.
I belong to a race which has somehow survived: always outnumbered, never outmanoeuvred. One reason is that we have always known how to say "No!". If the "No!" is not understood in Welsh, we have learned a little English to say it in English as well. Having given an "A" for effort to the Benches opposite for this excellent attempt—although there are one or two deficiencies; but I will not make too much of that—and, indeed, an "A+" to the Welsh Office for their attempt, I propose personally to consider both offerings and give my own view, hopefully marrying the virtues of both and abandoning the deficiencies of both.
12.30 p.m.
Lord ELTON: That was most elegantly done and, if there was a patronising element, it was so wrapped in courtesy that I do not resent it. I am not quite clear what the noble Lord is going to do when he has looked into the "Nobel prize competition" and marked the papers. He has said what the result will be, in that the first prize will go to the Welsh Office, who have certain advantages in this, one must admit. But can we not get together over this? The noble Lord declined to reveal the "deficiencies", as he put it—and that is a hurtful word. He spared the Committee the deficiencies but I suppose that would lead us into lengthy discussions on linguistics. If the two formulae are so similar, will he allow me to get together with the Welsh Office, absorb their version and put down an Amendment on Report stage? It would be nice to do something together to express good will across this Table. There has been acrimony. It would be a nice way to bury the hatchet, would it not? Could he not meet us in some way?
Lord GORONWY-ROBERTS: Of course we can get together and agree a version. I hope that the noble Lord, from the point of view of his knowledge of the Welsh language, will not assert for himself the right of veto at any point. Of course we can get together on this. But is it necessary to put it into the Bill when in the only example of a test of

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opinion since the Welsh Language Act was passed in 1967 we did not do it? That too was a great question put to a great people: the question of our permanent membership of the Community. This was not the procedure used then.
I suggest that the Welsh Language Act of 1967—which was a seminal Act—should not be lightly laid aside. It should continue to be used as the central matrix of any procedure of this kind that becomes necessary from time to time Let us have discussions and, in the light of those discussions, perhaps the noble Lord may wish to put down an Amendment I hope he does not, but certainly I will discuss this with him When I say that "A" for effort applies to him, I have not read the papers over again. It may well be that his effort may supersede the other one.
Lord ELTON: The noble Lord is very kind. He says that it is not necessary; I think it is fitting. I take the point that it should be gone through with a toothcomb and we shall return to the matter later. I beg to withdraw the Amendment.
Baroness GAITSKELL: If the Minister will put everything in this Bill which is nice but not necessary it will be twice as long as it is already.
Amendment, by leave, withdrawn.
Schedule 12, as amended, agreed to.
Clause 82 agreed to.
Clause 83 [Short Title]:
On Question, Whether the Clause 83 shall stand part of the Bill?
The Earl of BALFOUR: I should like to make a few comments on this final clause. I know it is not one to which reference is normally made. I particularly ask your Lordships to consider how far this Act should extend. Clause 83 is perfectly all right as it reads:
"This Act may be cited as the Wales Act 1978".
I should like to refer to the equivalent clause in two other Bills that are before your Lordships' House at the moment. May I take the Electricity Bill as an example? It states:

"(1) This Act may be cited as the Electricity (Scotland) Act 1978.

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(2) Subject to subsection (3) this Act extends to Scotland only.

(3) Paragraph 1(b) of Schedule 3 shall extend to England and Wales.

(4) This Act shall come into force on the expiry of a period of one month beginning on the date of its passing".

Taking the same point, the National Health (Scotland) Act provides:

"(1) This Act may be cited as the National Health (Scotland) Act 1978.

(2) Subject to subsection (3) this Act extends only to Scotland.

(3) Paragraph (3) of Schedule 10 extends to other parts of the United Kingdom.

(4) This Act shall come into force on 1st January 1979".

I think that the people of the United Kingdom should be aware how far the Wales and the Scotland Bills extend to cover the whole of the United Kingdom or otherwise. I leave this to the Government to decide. While I am on this point—and not wishing to delay your Lordships at this late stage on a Friday afternoon—I should like to take in one other point. Would your Lordships please turn to page 31, line 31 of the Wales Bill. This is in Clause 79(1). The line reads:
"Act 1974, a Scottish Assembly Act, any instrument".
I do not think that I need to go any further. Exactly the same words appear in the Scotland Bill as amended at its Report stage in this House. I suggest to noble Ministers that either they leave out the word "Scottish" and insert the word "Welsh", or come forward with an appropriate Amendment at Third Reading of the Scotland Bill and substitute in the appropriate place "Welsh" for "Scottish". The wording is exactly the same on page 37, line 31 of the Scotland Bill. It also reads:
"Act 1974, a Scottish Assembly Act, any instrument".
Leave out the word "Scottish" in the Scotland Bill and insert the word "Welsh" so the provision reads, "a Welsh Assembly Act". They cannot both be right. I realise that this is a late time on a Friday afternoon. I do not intend to press the matter any further and I hope that your Lordships will have an enjoyable week-end.
Lord GORONWY-ROBERTS: The noble Earl has made a point on which I think I can now satisfy him. There is absolutely no need for an extent provision here. One puts in one as necessary to

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clarify whether or not Scotland is covered. This is clearly an England and Wales Bill, and no provision is needed. What the noble Earl has said in regard to other provisions of the Bill—notably Clause 79 — is apposite to that clause and not to this one. I confine myself for the moment to the point of clarification that there is no need for an extent provision in the Short Title clause in this Bill. He will wish to consider what I have said between now and later stages. I must indicate now that the attitude of the Government on firm advice is as I have put it to the House.
The Earl of BALFOUR: I am afraid that I must go a little further: as this Bill reads now, it appears to me that the Scottish and Welsh Assemblies could combine together within their devolved powers and introduce legislation which might affect other citizens within the United Kingdom who might not have a chance to say anything about it. I shall say no more.
Lord GORONWY-ROBERTS: That, to say the least, is not just improbable but I would say also impossible. The Bill as a whole makes provision for executive action in Wales and confines it, first, to the nature of the action and, secondly, to the areas covered by the clauses and Schedules. So in any case it would be impossible for this Bill to be used and therefore for the Assembly to be used in the way the noble Earl has suggested.
Clause 83 agreed to.
Schedule 11 [Amendments of enactments].
12.41 p.m.
Lord ELTON Lord ELTON moved Amendment No. 108D:
Page 72, line 36, at end insert—
("THE EDUCATION ACT 1944
( ) At the end of section 13(4) of the Education Act 1944 there shall be inserted the following new subsections:
"(4A) (a) The Secretary of State shall give public notice of his decision to approve the proposals made under this section, with or without modification, or to withhold that approval; and
(b) if that decision is a decision to approve the proposals with modifications the notice shall include a statement of those modifications; but,
(c) where the functions of the Secretary of State under this section have been discharged by the Welsh Assembly, that approval shall remain provisional until either
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(i) the expiry of the period for the submission of objections against that approval laid down under subsection (4B) of this section or,

(ii) where an objection has been submitted during that period, the giving of public notice under subsection (4B) of this section.

(4B) Where the functions of the Secretary of State under subsections (4) and (4A) of this section have been discharged by the Welsh Assembly:

(a) those persons entitled under subsection (3) of this section to submit objections may, within two months of public notice being given under subsection (4B) of this section submit objections to the Secretary of State; and

(b) the Secretary of State may approve the proposals against which the objections have been submitted after making such modifications therein, if any, as appear to him to be desirable; and

(c) the Secretary of State shall give public notice of his decision to approve the proposals, with or without amendment."").

The noble Lord said: This Amendment is consequential upon one that was carried earlier relating to Schedule 2. I shall not delay your Lordships by speaking to it, but this may be a suitable opportunity to raise one technical matter which, regrettably, we must have clear before Report state. I could do it by moving another Amendment, which at present I do not intend to; so perhaps it would be quicker to do it here.
Your Lordships will remember the paving Amendment to this Amendment, which was one which excepted this Amendment, when it is in the Bill, from the operation of Schedule 2. As I understood it, the function of Schedule 2 was to devolve to the Welsh Assembly the powers listed under the Acts on the left-hand side, and not excluded with the exclusions on the right-hand side of the relevant page in Schedule 2. By introducing a new power and not getting it printed in the right-hand column, one would be bringing it automatically into the scope of the Education Acts 1944 to 1975, I think, and thus exposing it to the effect of devolution. As the intention of the Amendment is to reserve to the Secretary of State the right of appeal in particular cases, it would seem to me, on a layman's reading, that that power also would be devolved and therefore negated, because the power of appeal from the

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Assembly would in fact be devolved to the Assembly.
The noble Lord was kind enough to send me a most illuminating and helpful document, explaining the philosophy behind the drafting, which I received only three minutes before I came into the Chamber. That has done a good deal to explain to me what has hitherto been obscure. Indeed, it might be a useful precedent in connection with future Bills of a technical nature if a document of this sort could be made available earlier. I am not criticising the noble Lord for not sending it earlier, because so far as I know this has never been done before. However, it strikes me as being a very useful precedent.
It became clear to me on a first reading that certain assumptions were implicit in the drafting of the Bill, and that on some occasions the operation which I imputed to Schedule 2 was effective and on some it was not. I raise this now because, if the paving Amendment to this Amendment is the solitary exception to the principle which is adduced as that which informs the courts when they look at the Bill and decide whether or not Schedule 2 operates, it may be that this exception will invalidate the assumption on which the interpretation of the remainder of the Bill will rest. I hope I have made that clear.
It seems to me that even if this "paver" is superfluous, in the noble Lord's view, it might be more than superfluous if it led to a different decision in the courts on an analogous case where the "paver" was absent. Having expressed the same thing twice in two different ways, I do not expect the noble Lord to leap up and give an instant reply, because I think the answer to this will have to flow from the same pen that penned the words above his signature on the document which the noble Lord sent to me. However, I think we need to get this right before Report stage.
There is also the technically interesting feature that it would be open to me to move all the Amendments consequent upon the paving Amendments which I did not press earlier because, if the paving Amendments are not necessary, there is no obstacle to placing these Amendments, which are the principal ones, in the Bill at this stage. However, I shall not suspend
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that sword of Damocles over the Committee any longer: I do not intend to move that sequence, though there are among them one or two minor Amendments I should like to speak to.
The MINISTER of STATE, DEPARTMENT of EDUCATION and SCIENCE (Lord Donaldson of Kingsbridge): Of course, the Government must accept this Amendment, as it is consequential upon the defeat of the Government caused by noble Lords some time last week. On the general question raised by the noble Lord, I think the document I have sent to him contains the answers to his worries; but I, too, have only had the chance to go through it once. We shall both have the opportunity to study it, and if the noble Lord is not satisfied he can come back to me on Report. In accepting this Amendment, the Government would like to point out that we think there is some rather "dicey" drafting in it and it will probably have to be looked at again. In principle, we accept the Amendment.
Lord ELTON: I am very grateful to the noble Lord. As I drafted the Amendment myself, I expected criticism: indeed, I am only surprised it was not more trenchant. I will also take the opportunity of putting it right at Report stage, possibly with the advice of his helpers.
On Question, Amendment agreed to.
[Amendments Nos. 108B, 108F, 108G, 108H, 108J and 108K not moved.]
Lord ELTON Lord ELTON had given Notice of his intention to move Amendment No. 108L:
Page 72, line 36, at end insert—
("( ) After section 68 of the Education Act 1944 (c. 31) there shall be added the following new section:
"68AA. Where the Secretary of State is satisfied, upon a complaint by a local Education Authority in Wales, that the Welsh Assembly have acted or are proposing to act unreasonably towards them with respect to the exercise of any power conferred or the performance of any duty imposed by or under this Act, he may, notwithstanding any enactment rendering the exercise of the power or the performance of the duty contingent upon the opinion of the Assembly, give such directions as to the exercise of the power or the performance of the duty as appear to him to be expedient and in this section references to a local Education Authority shall be construed as laid down in section 68 of this Act."").
The noble Lord said: The noble Lord shakes his head, and my instinct is to rise to my feet! I think the only purpose in so doing is to remind your Lordships that this Amendment, together with Amendment 108K, relates to the specific provision in the Education Act 1944 for guarding against the unreasonable use of powers. It was necessary for me to point out with some force in a previous debate which finished in the early hours of yesterday morning, that it was perfectly normal to guard against the unreasonable use of powers by an elected body such as the Assembly or a local authority.
Both the Amendments I have referred to are dependent on clauses which do that, and I merely say this in vindication of all I said before. Unless the noble Lord wishes to come back at me, I shall not move this Amendment. He shakes his head. I shall not move the Amendment.
12.48 p.m.
Lord ELTON Lord ELTON moved Amendment No. 108M:
Page 72, line 36, at end insert—
("(2) At the end of subsection 77(2) of the Education Act 1944 (c. 31) there shall be added the following subsection—
"(2A) Where the duty laid upon the Secretary of State by subsection (2) of this section is performed by the Welsh Assembly a copy of each report made by Her Majesty's Inspectors shall be sent by them to the Secretary of State as soon as it has been made."").
The noble Lord said: Very briefly, in moving this Amendment I want to take the opportunity to ask the noble Lord two questions. I think I may have taken the noble Lord by surprise by moving this Amendment and so I will explain at a little more length. It relates to Section 77(2) of the Education Act 1944 and is a question of the reporting by Her Majesty's inspectors to the Secretary of State when they inspect a school. The inspectors will still be appointed, owing to a reservation in Schedule 2, on the advice of the Secretary of State to Her Majesty. That will not be in the hands of the Assembly, and therefore to that extent the Inspectorate will be responsible to the Secretary of State. However, all the product of their labours at present is intended to go to the Assembly, and I think that may well be proper, because the Assembly is in charge of education.
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However, one then wonders how they will discharge their responsibilities to the Secretary of State. One has the subsidiary wonder or speculation as to what the people in the Welsh Office, who have recently taken on the functions concerning education in Wales, will be engaged upon if they do not receive these reports, and to what extent the Secretary of State for Wales will be kept informed of education matters within Wales, if he is to discharge any responsibilities towards Wales in this area in the Cabinet.
It seems to me he must be kept informed, and therefore there are two questions here. The first is: Is there going to be any surviving formal link between the educational system in Wales and the Secretary of State for Wales? The other one, which I suppose in a sense is dependent upon it and relates once more to the staffing under the new arrangements, is: Will there be a general posting of civil servants at present in the Welsh Office to work for the Assembly, or will there not? If there is not, what will the remaining civil servants be doing? I beg to move.
Lord DONALDSON of KINGS-BRIDGE: This Amendment is one of the Amendments which the noble Lord said he would not move, because he did not move the paving Amendments earlier on. I make no complaint about that, but it means that I have given rather less thought to it than I otherwise should. What it does is to require a copy of an inspector's report to be sent to the Secretary of State, which is a perfectly sensible idea, no doubt providing him with some of the material he needs for the policing of the Assembly's actions—a task placed upon him by a number of the noble Lord's Amendments.
The Government reject any suggestion that the Secretary of State should have such a role. The Assembly must have full responsibility for the education system, if it is to have any power at all in this field. This scheme creates another tier in the administration of education, and creates the right atmosphere for great conflict between the elected Assembly and the Government at Westminster.
The noble Lord asked about civil servants. Clearly, the Bill will not lay down what movement of civil servants

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there will be, and it would be very odd indeed if there were not some movement towards the Assembly by civil servants working in the Welsh Office. But this is not something which is in the Bill, or which ought to be in the Bill.
Lord ELTON: I apologise, first. I had not realised that there was a "paver" to this one. But, of course, there must have been. No, I think that I am innocent, unless the receipt of information is a function under the terms of the Act. But, in any case, I apologise for misleading the noble Lord into making that very defensive statement, because I am not intending to press this Amendment; nor am I regarding it as an aspect of policing, as the noble Lord rather emotively put it, of the Assembly. I wanted to establish what would be the relationship in the defensive role of the Secretary of State, if he was called in aid in the Cabinet—because I understand that he is to be a Cabinet Minister. He must be doing something for the Welsh, and he cannot do it if he acts in darkness.
But it is clearly not right to pursue the matter, when the noble Lord is briefed to the effect that I had something else in mind, which was largely my fault, so I shall not press this Amendment. I have a few words to say on Amendments Nos. 108P and 108Q, which are not of great importance; certainly, the first one is not. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
[Amendment No. 108N not moved.]
12.53 p.m.
Lord ELTON Lord ELTON moved Amendment No. 108P:
Page 72, line 36, at end insert—
("( ) In section 94(1) of the Education Act 1944 (c. 31) for the words ("two shillings") there shall be substituted the words ("75 pence").").
The noble Lord said: This is rather like a housewife going through the drawing-room with a duster in her hand, and seeing a cigarette in the ashtray. It seems silly not to point out that the regulations dependent on Section 94(1) of the Education Act charge the very small sum of 75p for certain services, yet the parent Act still has the words, "two shillings". The noble
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Lord can put £50 in the brackets if he likes, but it seems silly to go past and not use the duster. I beg to move.
Lord DONALDSON of KINGS-BRIDGE: I think we can deal with this as quickly as with the cigarette end. The fee was increased to 75p by the Registration of Births, Deaths and Marriages (Fees) Order 1975; that is, Statutory Instrument 1975 No. 1291. Even if that had not been the case, this Amendment, because it seeks to increase the fee generally and not in connection with the devolution of powers to the Welsh Assembly, would not be within the Long Title of the Bill. But, in fact, it is unnecessary, because the alteration already exists outside the Bill.
Lord ELTON: The cigarette was obviously trompe d'oeil. I shall not press the Amendment and I beg leave to withdraw it.
Amendment, by leave, withdrawn.
Lord ELTON Lord ELTON moved Amendment No. 108Q:
Page 72, line 36, at end insert—
("( ) In section 94(3) of the Education Act 1944 (c. 31) after the word ("crown") insert the words ("or, where the functions of the Secretary of State under this section have been discharged by the Welsh Assembly, to the Welsh Consolidated Fund.")").
The noble Lord said: This Amendment is to elicit a view on the question of the management of funds, and I suspect that the answer will again be fairly short. I have to tell your Lordships that I regret I am looking at the last print of the Marhsalled List, and I notified a misprint to the Table last night. It relates to Section 99(3). Is that what the noble Lord has in mind? I see that it is. It appears as Section 94(3) on my copy which does not make sense. Section 99(3) relates to the payment for functions discharged by the Secretary of State, in default of their discharge by managers or governors of schools. It lays down that the debts incurred by this means shall be regarded as debts "due to the Crown".
This is, therefore, a drafting point to know whether, when the function under this section is devolved, the words "due to the Crown" are correct. Presumably, the repayment will be due to the Welsh Assembly and will have to be paid into the Welsh Consolidated Fund. I do not

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know whether the words, "a debt due to the Crown" include a debt to the Welsh Assembly or to the Welsh Consolidated Fund. It is for the Government to redraw the Bill as appropriate rather than for me, but this is a means of drawing their attention to what may be a defect. I beg to move.
The CHAIRMAN of COMMITTEES (Lord Aberdare): Amendment proposed, page 72, line 36, after the words last inserted, insert the words as printed, with the amendment of Section 94(3) to Section 99(3).
Lord DONALDSON of KINGS-BRIDGE: As the noble Lord suspects, the Amendment is unnecessary. As the Assembly acts on behalf of the Crown, the present wording covers the recovery of a debt owing to it, and any payments it obtains under this provision will, in any case, be payable into the Welsh Consolidated Fund under Clause 42(3) of the Bill. I think that that is a satisfactory answer to the noble Lord.
Lord ELTON: It is entirely satisfactory, and I am grateful to the noble Lord. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
[Amendment No. 108R not moved.]
12.57 p.m.
Lord ELTON Lord ELTON moved Amendment No. 108S:
Page 72, line 36, at end insert—
("( ) After subsection 105(1) of the Education Act 1944 (c. 31) there shall be inserted the following new subsection—
("(1A) Where a loan is made under subsection (1) of this section by the Welsh Assembly the consent of the Treasury to the making of that loan shall not be required.".").
The noble Lord said: This is not quite an analagous point, but it is an interesting one. It also relates to funds. Under the 1944 Act, there is provision in Section 105(1) for the making of loans for certain purposes, such as the rapid expansion or alteration of the nature of schools. I imagine that this section has been fairly widely used during the comprehensive reorganisation. So long as the Secretary of State was authorising the loans, it was necessary for him to have the concurrence and approval of the Treasury. Noble
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Lords are always accusing us, in a full House, of producing policemen and apron-strings, and the House is miraculously empty when I suggest that they are producing too many policemen and apron-strings as well. So that, perhaps to this select audience, the noble Lord can justify the policemen, the truncheon and the apron-strings. I beg to move.
Lord DAVIES of LEEK: I am not certain about the relevance of what I have to say, and I do not intend to make a Second Reading speech. But at this juncture, because there are a number of probing Amendments, I should like to make a statement which also probes and it is in reference to loans. I am concerned about higher education in Wales and the university grants system. I am not sure how the grants system for the University of Wales will be related to the Assembly.
The Welsh may have very funny ideas about education, and the system may be slightly different and need more money. In the 'thirties, and in the old days of the Depression, most children living in Welsh counties had a better chance of secondary or university education than many in the richest parts of England, because of the gracious and great grants that were made in order for worthy children to get to university. I do not expect an answer now, but I hope that there will be some clarification of the relationship between the Assembly and university education and medical schools. At Cardiff University there is a wish to extend the medical school in relation to the university. I believe that the Chairman of Committees would rule me out of order if I went further. Consequently, I shall not trespass further on the time of the Committee.
1 p.m.
Lord DONALDSON of KINGS-BRIDGE: I can give the noble Lord a very clear answer about universities. Universities are not devolved. After devolution, they will depend upon the University Grants Committee, as they do now.
Turning to the noble Lord's Amendment, the effect of the Wales Bill, as drafted, is to remove the need for Treasury consent when a loan is to be made by the Assembly. The Bill devolves ministerial powers in relation to the enactments

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listed in Schedule 2. Where an existing provision requires the Minister to act with the consent of another or of the Treasury, then in effect the consent requirement disappears. I therefore suggest that the noble Lord, Lord Elton, may feel satisfied that his Amendment is not necessary.
Lord ELTON: I am, of course, satisfied with the noble Lord telling me that this is the effect of the Bill. As we are getting well into Friday afternoon, I shall not ask him how the Bill arrives at this effect, though I should like to know. However, I do not wish to tempt the Minister to his feet again. Looking at his words over the weekend, I shall probably work it out for myself. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
[Amendment No. 108T not moved.]
Lord ELTON Lord ELTON moved Amendment No. 108U:
Page 73, line 2, at end insert:
("THE. EDUCATION ACT 1946
( ) In section 15 of the Education Act 1946 there shall be inserted after the word "expenses"—
"(1)" and at the end of that section of that Act there shall be added"; but
(2) Notwithstanding the provisions under subsection (1) of this section any such increases incurred by the Welsh Assembly shall be defrayed out of the Welsh Consolidated Fund."").
The noble Lord said: Again I am in quest of information. Section 15 of the Education Act 1946 is very short. It merely lays down that:
"Any increase attributable to the passing of this Act in the expenditure of the Minister under the enactments relating to education shall be defrayed out of moneys provided by Parliament".
It is possible that this point was covered during our debates on the financial provisions. However, when we come to Wales I do not know what exactly are the "moneys provided by Parliament". Does this mean that the expenses will automatically be defrayed out of the Welsh Consolidated Fund or the Welsh Loan Fund? If so, I have nothing further to say. If not, then somebody ought to be aware of it. I beg to move.
Lord DONALDSON of KINGS-BRIDGE: The answer to the noble Lord's
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question is, Yes. The Assembly will assume ministerial functions under the Education Act 1946 by way of Part III of Schedule 2. Clause 55(1)(c) effects the necessary conversion—which I think is the point at issue—of the references to the Secretary of State and moneys provided by Parliament into a reference to moneys paid out of the Welsh Consolidated Fund. Therefore the Bill already achieves the effect sought by the noble Lord's Amendment.
Lord ELTON: I am much obliged to the noble Lord. May I ask him whether the reference was to Clause 55(3)?
Lord DONALDSON of KINGS-BRIDGE: No, to Clause 55(1)(c).
Lord ELTON: I am much obliged. I shall not press the Amendment further.
Amendment, by leave, withdrawn.
Baroness STEDMAN Baroness STEDMAN moved Amendment No. 108A:
Page 74, line 39, leave out second ("and") and insert ("(2)").
The noble Baroness said: This is another in the series of Amendments which deal with the making of statutory reports to the Assembly and their publication by it. In this case, the Amendment is concerned with the provision of abstracts relating to the registrations by the Registrar-General and their publication by the Assembly. I beg to move.
Lord ELTON: If I may make a very small drafting point, I do not see how we can start with a "2" unless we have a "1" inserted before it.
Baroness STEDMAN: It seems to me to be a good point. We shall have a look at it.
Lord ELTON: If I am right, this may well be a point which could be dealt with by the clerks. It is only a question of numbering the introduction in the right sequence. I should be happy if that were done.
Baroness STEDMAN: We shall certainly have a look at the point.
On Question, Amendment agreed to.
Baroness STEDMAN Baroness STEDMAN moved Amendment No. 108B:
Page 74, line 42, at end add ("; but the Assembly shall publish every abstract that it receives under that section").
The noble Baroness said: The same remarks apply to this Amendment. I beg to move.
On Question, Amendment agreed to.
Baroness STEDMAN Baroness STEDMAN moved Amendment No. 108C:
Page 75, line 6, at end insert—
("(2) The expenses referred to in section 7 of that Act do not include expenses incurred by the Assembly.").
The noble Baroness said: This is a technical Amendment to put it beyond doubt that the Welsh Assembly will have no access to the National Land Fund under Section 7 of the Historic Buildings and Ancient Monuments Act 1953. Schedule 3 to the Bill provides that both the Assembly and the Secretary of State will have powers under Sections 4 to 6 of the 1975 Act to purchase and maintain historic buildings and to provide grants for their purchase and maintenance.
As the Assembly will be financed purely from the block fund, it is intended that any expenses incurred by it under Sections 4 to 6 should be financed from that fund and not from the National Land Fund. However, the Secretary of State will be able to use moneys from the National Land Fund if he exercises his concurrent powers under Sections 4 to 6. Thus, Wales will continue to be able to benefit from the National Land Fund in the same way as the rest of the United Kingdom. Provision for drawing money from the National Land Fund is made in Section 7 of the 1953 Act. The powers under this section are reserved in Schedule 2, but the wording of Section 7 is such that it is not clear whether this is sufficient to deny the Assembly access to the Fund. The proposed Amendment alters the wording of Section 7 so as to remove any doubts. I beg to move.
Lord DAVIES of LEEK: May I urge my noble friend to read the current number of Country Life which contains a leading article on the National Land Fund. There is a report now before the House on that Fund. This Fund is almost completely under the control of the
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Treasury. That should not be so. Wales is concerned about control over the National Land Fund. This is an important point. It should be on the record that action ought to be taken to lessen the powers of the Treasury over the National Land Fund. May I urge Members to read the latest number of Country Life and the Select Committee's Report on the National Land Fund.
Baroness ELLES: Before the noble Baroness replies, may I remind her of the remarks I made yesterday in connection with Schedule 9, which would have put listed buildings under Part I of that Schedule, thus enabling the Secretary of State to intervene and hold a public inquiry on precisely this kind of matter. This Amendment reinforces my point that as the Bill stands at the moment the Welsh Assembly will not have direct access to the National Land Fund. If the Secretary of State were to be given the power to intervene in the case of a building or monument of historic importance not only to Wales but to the nation as a whole and to hold a public inquiry, obtain public support and force the Treasury to release money from the National Land Fund, the hand of Wales would be strengthened, not weakened. That would be the result if the Amendment which I suggested yesterday were to be included. I think that what the noble Baroness and the noble Lord have said reinforces my argument.
Baroness STEDMAN: Yes, we shall certainly look at that point. So far as the new report on the National Land Fund is concerned, that is not within the purview of this Bill. I am sure that when they look at it the Government will bear in mind the comments which have been made both here and in another place. Without advertising, I can give my noble friend an assurance that I shall have a look at the article in Country Life, which is on my desk but which I have not yet had time to read.
On Question, Amendment agreed to.
[Amendment No. 108V not moved].
1.10 p.m.
Baroness STEDMAN Baroness STEDMAN had given Notice of her intention to move Amendment No. 108W:
Page 75, line 29, at end insert—
("THE MENTAL HEALTH ACT 1959
21A. In section 28(2) of the Mental Health Act 1959 after the words "Secretary of State" there shall be inserted the words "or the Welsh Assembly".").
The noble Baroness said: This is another Amendment by the Government to the Mental Health Act 1959. When we discussed the Amendment to the entry for the Act in Schedule 2 we agreed to withdraw it to allow for further discussion at a later stage. In the circumstances I think it better not to move this Amendment. but to deal with that also at a later stage.
The Marquess of TWEEDDALE The Marquess of TWEEDDALE moved Amendment No. 109:
Page 76, leave out lines 9 to 30.
The noble Marquess said: This is another Amendment on forestry and is consequential on a previous Amendment. beg to move.
Baroness STEDMAN: The Government accept this Amendment as a consequence of the earlier decision to delete forestry from Schedule 2, and it is of course without prejudice to the possibility of the restoration of it after the Bill returns from another place.
On Question, Amendment agreed to.
[Amendment No. 109B not moved.]
Baroness STEDMAN Baroness STEDMAN moved Amendment No. 109A:
Page 79, line 7, at end insert—
"THE LOCAL EMPLOYMENT ACT 1972
39A.—(1) In relation to a development area or intermediate area in Wales, subsection (1) of section 7 of the Local Employment Act 1972 shall have effect as if—

(a) for the words "the Minister in charge of any Government department" there were substituted the words "a Minister of the Crown"; and

(b) the words "for which the department is responsible" were omitted.

(2) After that subsection there shall be inserted—
"(1A) Where it appears to the Welsh Assembly that adequate provision has not been made for the needs of any development area or intermediate area in Wales in respect of a basic service for which the Assembly is responsible, and that it is expedient with a view to contributing to the development of industry in that area that the service should be improved, the Assembly may make grants or loans towards the cost of improving it to such persons and in such manner as appear to the Assembly appropriate".
(3) In subsection (3) of that section after the words "Minister of the Crown" there shall be inserted the words "or of the Welsh Assembly".").
The noble Baroness said: I heralded this Amendment when proposing an earlier paving Amendment to Schedule 3. I explained that for technical reasons it is necessary to provide for Section 7 of the Local Employment Act 1972 in Schedule 11 to the Bill rather than in Schedules 2 and 3 as previously proposed. Section 7 of the Local Employment Act enables Ministers in charge of Government Departments to make grants and loans in respect of "basic infrastructure services" in development and intermediate areas. Our intention is that Ministers should continue to be able to do so after devolution in respect of the full range of infrastructure services. This reflects their continuing responsibility for industrial and regional policy. It is also our intention that the Assembly should have a concurrent power in respect of those particular services for which it will be responsible in other contexts (roads, sewers and water are examples). As the power is simply one to pay grants or loans, concurrency should not lead to conflict. For other services (such as gas and electricity) only the Government would be able to exercise powers.
The difficulty is that Section 7 is in such terms that it only confers power on a Minister in charge of the Department responsible for the service in respect of which the grant or loan is to be made. After devolution the Assembly, and not Government Departments, will be responsible for services such as roads and sewers. Thus the Government would, it appears, not be able to make grants or loans in respect of these services unless we broaden the terms of Section 7 so far as Wales is concerned. That is what is achieved by this Amendment. I beg to move.
Lord ELTON: I was slightly distracted at the beginning of what the noble Baroness said and I am not certain whether she said that this Amendment would keep this Bill in step with the Scotland Bill. If so, the move to bring this in was initiated by my noble friend Lord Drumalbyn, to whom I now express thanks.
On Question, Amendment agreed to.
Lord SKELMERSDALE Lord SKELMERSDALE moved Amendments Nos. 109F to 109J:
Page 80, line 41, at end insert ("any order establishing or varying the constitution of the Welsh authority").
Page 80, line 42, leave out ("five") and insert ("twenty-one")
Page 81, line 1, leave out ("five") and insert ("twenty-one")
Page 81, line 2, at end insert—
("( ) the county council of each county in Wales;
( ) the councils of the districts within each county in Wales;").
The noble Lord said: We now return to the matter of the powers of appointment of county councils to various water-type authorities. I think it will be to the convenience of the Committee if I move Amendments Nos. 109F to 109J en bloc and leave Amendment No. 110A to stand alone. These first four Amendments concern the powers of appointment by the county councils to the Welsh Water Authority. I think perhaps we have covered a lot of this ground already, but it might be for the convenience of the Committee if I were to repeat what the noble Lord, Lord Harris of Greenwich, said when we discussed this matter on a previous occasion. He said:
"The net effect for the Welsh Water Authority is that the Assembly order reconstituting the Authority … must provide for one member to be appointed by the Government, and four by local authorities in England. The appointment of the remainder will be a matter for the Assembly to decide—a power resting with the Assembly—but it may wish to continue"—
"It may wish," I repeat, "to continue"—
"the present arrangements whereby a number of appointments are made by the Welsh local authorities".—[Official Report; 15/6/78, col. 661.]
Obviously one quite understands that the noble Lord can give no commitment as to what the Assembly may or may not decide in the future, but he is absolutely clear in this matter that there will not necessarily be any representation from the Welsh county councils on the Welsh Water Authority and these Amendments are designed to ensure that there will continue to be the representation that we have at the moment.
These Amendments are intended to protect the Welsh local authorities' right to direct representation on the Water Authority. They are based on the same formula as that set out in Section 3(6)(b) of the Water Act 1973 and the Welsh
1578
National Water Development Authority (Establishment and Constitution) Order 1973. They would provide for a total of 16 members to be appointed by Welsh local authorities, one from each county in Wales and one to be appointed jointly by all the districts in each county. I beg to move.
Lord DAVIES of LEEK: I think these are worthy Amendments, which extend the democratic control. I do not know whether my noble friend will accept them or what answer she will give but nevertheless I think it is a constructive effort to give local authorities and others a say in water affairs. I shall welcome them if they are accepted.
Viscount AMORY: I hope I may be allowed strongly to support what my noble friend Lord Skelmersdale has said. Two or three times in the course of the debate on this Bill I have called attention to statements by Ministers giving assurances that nothing in this Bill will change or detract from the rights and responsibilities of existing local authorities but here we surely have precisely that taking place.
At present, the local authorities have the right to appoint members of these Water Authorities. It is now proposed that, instead of that, they should lose that right of appointment, as I understand it, but the Assembly should have that right. The Assembly then will have more power in this matter than Ministers have now, but water and land drainage—which we shall be discussing later—are two matters of the greatest interest to local authorities, and, in view of what Ministers have said, I think it is wholly wrong that these rights and responsibilities for appointment should in spite of what has been said, now be transferred to the Assembly.
I hope the noble Baroness will tell us that she appreciates this and that this matter will be looked into again. Otherwise, I hope my noble friend will press this matter to a Division because it is a great discouragement to the local authorities involved and conflicts with assurances which have been given on a number of occasions in the discussions on this Bill.
Lord ELTON: I should like to associate the Front Bench on this side with the remarks made by my two noble friends.

1579
They have been made concisely and eloquently and I need not add to them except to say that I agree with all they have said, as I do with the noble Lord, Lord Davies of Leek.
Baroness STEDMAN: I am obviously being assailed both from in front and behind. The Government consider that water is an important domestic concern to people who live in Wales, and therefore they have given the Assembly quite substantial powers. An essential part of the proposals is that the water authorities should be fully accountable to the Assembly over their activities in Wales. The Bill provides for the Assembly to exercise the powers to constitute the Welsh Authority Water. But since the Authority's area, as defined by the Water Act of 1973, includes parts of England, paragraph 53 of Schedule 11 to the Bill, with which these Amendments are concerned, ensures that those English interests must continue to be represented on the water authority. The Government take the view that this essential safeguard of English representation does not justify fettering the discretion given by the Water Act in relation to the remaining Welsh appointments, and that it should be for the Assembly, as it is now for the Secretary of State, to decide what is the appropriate balance of Welsh representation.
This does not mean that local authority representation will be excluded. Surely it will be no less apparent to the Assembly than it is to the Secretary of State now that the Welsh local authorities have had significant experience and have a lot to contribute in this area. Knowing the Welsh authorities, at least from a county council point of view, I think they are very unlikely to remain silent if they feel that the Assembly is not treating them fairly. But devolution means leaving decisions of this kind to the Assembly. Therefore, I must ask the Committee to reject these Amendments.
Viscount AMORY: May I ask the noble Baroness one question? She did not reply to what I had said, I hope not too offensively, about the assurances Ministers have given that existing powers and responsibilities of local authorities would not be diminished by this Bill. It seems to me that this is exactly what is going to
1580
happen if this is done. She says that the Assembly may realise the value of local authority representation, but that is a hope expressed. Would the noble Baroness say whether I am right in thinking that it is difficult to reconcile this proposal with the assurances that Ministers have given?
Lord ELTON: What the noble Baroness has just said is immensely important and helpful. It has done what we have been trying to do for a very long time; it has revealed the attitude of the Government as between the Assembly and local authorities. They have claimed from the housetops that what they want to do is to make government more local. But when we now say, "Let us have local voices in decisions on really important matters like water", and others we are now discussing, they say, "No, these must go to the Assembly". Which is closer to the voter, the chap who turns on the tap, the local authority or the Assembly? The answer is obvious. This is not devolution downwards, it is absorption of power upwards. It is the reverse of what the Government have been claiming throughout is the purpose of this Bill. It reveals everything. It was a very valuable speech and I am glad the noble Baroness made it.
Baroness STEDMAN: We are not deviating from the line we have taken right through this Bill. Where the position has been that the Secretary of State has power to do certain things those powers are transferred to the Assembly. What we are saying is that we do not dictate to the Assembly that they must have certain number of local authority representatives on the Welsh Water Authority. But we are equally certain that the Assembly, which will be constituted of people who are concerned about what happens in Wales and concerned about the administration, who know the valuable work the local authority members on the Welsh Water Authority have done, will be careful of this and will ensure that the local authorities are represented. But we cannot dictate and we should not dictate to them how many local authority members ought to be appointed.
Viscount AMORY: Surely the noble Baroness is not quite right when she says that it is only a question of transferring

1581
responsibilities at present exercised by the Minister. Surely in this case more than that is being transferred to the Assembly. As I understand it, at present local authorities have the right themselves to appoint these members. That right is not exercisable by the Minister but by the local authorities themselves. It is now being transferred, as my noble friend Lord Elton said, upwards to the Assembly, which I think is an awfully bad thing to do and, to my mind, does not seem to fit in with any of the assurances we have had. When somebody has suggested this before, transference upwards, Ministers have said, "No, we have to intention of having responsibilities transferred upwards, only downwards from the Minister". That is where I think this proposal conflicts rather dangerously with the principles on which Ministers have advocated the Assembly's responsibilities should be allocated.
Lord DAVIES of LEEK: I am always afraid of bureaucracy, never mind whether it is Welsh, Scots or English. Where we can get the devolution of power and where we can undermine bureaucracy, there I think we increase democracy. Local Government in Wales is noted particularly for the assiduity with which local councillors attend to their jobs and master the committees on which they sit. While I would not like the noble Lord to press this Amendment to a Division, nevertheless I do believe you could not have local democracy without first-class local representation, particularly in these two questions of water services and land drainage. The apt illustration was given by the noble Lord Lord Elton; where the person turns the tap on there he wishes to get immediately some quick answer to his problem—such as damage while on holiday, plumbing, stopping of water: all these things are of vital importance to the happiness of people living under local authorities. If you move upwards, as the noble Viscount, Lord Amory, said, there is a danger. Although we have spent a little time on this it is time well spent to show that we are watching that, whether we get an Assembly or not, we want to keep alive democracy in local government, whether it is English, Scottish or Welsh.
Lord ELTON: I think it would be better spent if we find that other noble Lords
1582
agree with us. I do think this is an essential point. I leave the decision to my noble friend, but it seems to me an important matter.
Baroness STEDMAN: We are not transferring any powers upwards. The constitution of the water authority is not laid down in the Act; it is laid down in an order. The order is at present made by the Secretary of State and it will in future be made by the Welsh Assembly. We have no reason to believe that the Welsh Assembly will not lay down in such an order that there shall be a certain number of local authority representatives. We are not trying to move anything upwards or take anything away from the local authorities. As my noble friend Lord Davies of Leek said, everyone in Wales knows the tremendous way in which local councillors at all levels have served Wales, and I am sure the Assembly will be aware of that. If they are not aware of it, I am equally certain we can rely on the Welsh authorities to tell them how good they are.
Lord SKELMERSDALE: It seems to me that the main platform of the Government throughout this Bill has been that its purpose is to transfer powers from the Secretary of State. Nothing the noble Baroness has said on this occasion convinces me that the powers were with the Secretary of State. They have never been with the Secretary of State. It is laid down in an Act of Parliament that these appointments shall be from the local councils. I do not regard this as a water issue at all. I agree very much with the noble Baroness on many points she has raised regarding the central water issue, but I do not regard this as a water issue; I regard it simply as a county council matter, a matter of direct representation to, as it happens, a water authority, by local people. I think everybody must accept that the Assembly is going to be that much further away from the local people, the man or woman who turns on the tap, as my noble friend said. I really believe that this is the crucial issue and I should very much like to have the opinion of your Lordships on this matter.
Baroness STEDMAN: I rise on a point of correction. The noble Lord must have misheard me or I did not make myself plain. The Act does not lay down

1583
what shall be the constitution of the water authority. The duty which the Act lays is on the Secretary of State, by order, to say what the constitution will be. It will be for the Welsh Assembly, by order, to do it in future.
Resolved in the affirmative, and Amendment agreed to accordingly.
1.38 p.m.
Lord SKELMERSDALE Lord SKELMERSDALE moved Amendment No. 109G:
Page 80, line 42, leave out ("five") and insert ("twenty-one").
The noble Lord said: This Amendment is consequential upon the last Amendment. I beg to move.
Lord SKELMERSDALE Lord SKELMERSDALE moved Amendment No. 109H:
Page 81, line 1, leave out ("five") and insert ("twenty-one").
The noble Lord said: This Amendment is also consequential. I beg to move.
Lord SKELMERSDALE Lord SKELMERSDALE moved Amendment No. 109J:
Page 81, line 2, at end insert—
("( ) the county council of each county in Wales;
1.30 p.m.
Their Lordships divided: Contents, 39; Not-Contents, 32.
( ) the councils of the districts within each county in Wales;").

CONTENTS

Amherst of Hackney, L.

Elton, L.

Mottistone, L.

Amory, V.

Emmet of Amberley, B.

Mowbray and Stourton, L.

Balfour, E.

George-Brown, L.

Sandford, L.

Balfour of Inchrye, L.

Gridley, L.

Sandys, L.

Cathcart, E.

Hailsham of Saint Marylebone, L.

Simon of Glaisdale, L.

Cockfield, L.

Skelmersdale, L. [Teller.]

Cullen of Ashbourne, L.

Ilchester, E.

Spens, E.

de Clifford, L.

Kinnaird, L.

Stamp, L.

Denham, L.

Lauderdale, E.

Trefgarne, L.

Derwent, L.

Long, V.

Tweeddale, M. [Teller.]

Drumalbyn, L.

Loudoun, C.

Vivian, L.

Effingham, E.

Lyell, L.

Ward of North Tyneside, B.

Ellenborough, L.

Mancroft, L.

Elles, B.

Morris, L.

NOT-CONTENTS

Beswick, L.

Houghton of Sowerby, L.

Sainsbury, L.

Brockway, L.

Kirkhill, L.

Samuel, V.

Collison, L.

Leatherland, L.

Segal, L.

Donaldson of Kingsbridge, L.

Llewelyn-Davies of Hastoe, B.

Stedman, B.

Evans of Hungershall, L.

Lloyd of Kilgerran, L.

Stewart of Alvechurch, B.

Gaitskell, B.

Lovell-Davies, L.

Stone, L.

Gordon-Walker, L.

McGregor of Durris, L.

Strabolgi, L.

Goronwy-Roberts, L.

Murray of Gravesend, L.

Wallace of Coslany, L. [Teller.]

Greenwood of Rossendale, L.

Northfield, L.

Winterbottom, L. [Teller.]

Hale, L.

Pitt of Hampstead, L.

Wynne-Jones, L.

Henderson, L.

Ponsonby of Shulbrede, L.

On Question, Whether the said Amendment (109F) be agreed to.

The noble Lord said: This Amendment is also consequential. I beg to move.
On Question, Amendment agreed to.
[Amendment No. 109C not moved.]
Baroness ELLES Baroness ELLES moved Amendment No. 109D:
Page 84, leave out lines 13 to 28.
The noble Baroness said: This Amendment is consequential. I beg to move.
On Question, Amendment agreed to.
Baroness STEDMAN Baroness STEDMAN moved Amendment No. 110:
Page 84, line 28, at end insert—
("(3) The Welsh Assembly shall publish each report received by it under this paragraph.").
The noble Baroness said: This is a further Amendment for the sending of statutory reports to the Assembly and their publication by it. Paragraph 87 of Schedule 11 provides for the Welsh

1585
Development Agency to make reports to the Assembly and to the Secretary of State on different aspects of its work and for the Secretary of State to lay before Parliament the reports which he receives. This Amendment fills a gap by requiring the Assembly to publish the reports which it receives. I beg to move.
Baroness ELLES: May I refer to the previous Amendment, which left out lines 13 to 28, which was consequent on a Division we had earlier in the Committee proceedings? I quite see that the noble and learned Lord the Lord Chancellor may wish to produce this Amendment at a later stage of the Bill, but as it stands lines 13 to 28 have, in fact, been removed by the previous Amendment.
Baroness STEDMAN: I am grateful to the noble Baroness and will withdraw the Amendment.
Amendment, by leave, withdrawn.
1.41 p.m.
Lord SKELMERSDALE Lord SKELMERSDALE moved Amendment No. 110A:
Page 84, leave out lines 30 to 32.
The noble Lord said: This Amendment is not quite the same as the last Amendments to which I spoke in that it concerns the Welsh regional land drainage committees. As lines 30 to 42 stand, they have the effect of removing the Welsh local authorities representation on the land drainage committees. There is a considerable interest, both of district and counties, in land drainage which is implicit in the constitution of the regional committees prescribed by the 1976 Act. My noble friends and I believe that Welsh local authorities must continue to be represented.
The effect of paragraph 88 of the Schedule would be that although in England local authorities continue to have a majority representation on land drainage committees, in Wales they will have no such representation at all, despite the fact that their interest in land drainage is not changed one iota by the Bill. The Amendment that I have tabled would have the effect of preserving the status quo whereby Welsh local authorities would continue to have a right of appointment. Other members,
1586
who are at present appointed by the Minister, would in future be appointed by the Assembly as that power of appointment under Section 2 of the Land Drainage Act 1976 is devolved by Part X1 of Schedule 2 to this Bill.
I take what the noble Baroness said when I moved the last Amendment, but it still seems to me that Ministers have to accept appointments made by English local authorities, whereas in Wales the Assembly is to be given overall power to make all appointments. I beg to move.
Viscount AMORY: I should like strongly to support what my noble friend Lord Skelmersdale has said, for the same reason as I supported him when he moved the Amendment on which we divided just now. It seems to me that here we are taking away from the local authorities a right which they have held, and we ought to maintain the status quo as far as we possibly can.
Baroness STEDMAN: If I were to reply in detail to what the noble Lord, Lord Skelmersdale, said, it would, in great part, merely be to repeat the arguments of last time. I recognise the view which the Committee has just come to, but I would ask the noble Lord to consider this, that due to the very difficult situation which this Amendment would leave in relation to the Severn-Trent Regional Land Drainage Committee, it should not be pressed at this stage. We can all reconsider the position, perhaps get together on it and come back to it on Report.
Lord ELTON: While we are gathering our wits—because things have moved so fast and also the order of the Amendments is different on the Marshalled List that the noble Baroness is using from the one I have been working from—I understood her to say something which sounds very much as though she might meet us on Report if we were prepared to wait until the Report stage; or is she saying that she expects to convince us between now and the Report stage? There is a difference, and we should like to know.
Baroness STEDMAN: At this stage I am not saying either. I am saying: can we get together, give further consideration to the position in which we

1587
are now left and perhaps come back to it again at the Report stage, either with an agreed Amendment or with something on which the noble Lord would prefer to go alone?
Lord ELTON: The decision rests with my noble friend Lord Skelmersdale, but from our point of view that sounds like a very reasonable offer. We would not commit ourselves to abandoning this point by any means. If the noble Baroness thinks that something can be done between now and the Report stage to make it different, I think that my noble friend would wish to listen to it.
Lord SKELMERSDALE: Perhaps I can quote the noble Baroness back at her: I think that we reserve our position without prejudice. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
The DEPUTY CHAIRMAN of COMMITTEES (Lord Amherst of Hackney): I must warn the Committee that if Amendment No. 109E is agreed to, I cannot call Amendments Nos. 111 and 112.
Baroness ELLES Baroness ELLES moved Amendment No. 109E:
Page 85, leave out lines 12 to 31.
The noble Baroness said: This Amendment is consequential and I think that the same situation arises as arose in the previous couple of Amendments.
Baroness STEDMAN: The Government are happy to accept this, again without prejudice.
On Question, Amendment agreed to.
[Amendments Nos. 111 and 112 not moved.]
The DEPUTY CHAIRMAN of COMMITTEES: If Amendment No. 112B is carried, I do not think that I can call Amendment No. 112C.
1.47 p.m.
Lord SANDYS Lord SANDYS moved Amendment No. 112B:
Page 85, leave out lines 44 to 47.
The noble Lord said: I hope that I may be permitted to help the Lord Chairman out of a little difficulty here. Amendments Nos. 112B and 112C are co-ordinated together, but Amendment No. 112A cannot be called should Amendment No. 112B be proceeded with. If I may refer to Amendments Nos. 112B and 112C together, I think it would be for the convenience of the Committee.
We are in some difficulty in this particular situation because it seems some long time ago that the Government moved Amendment No. 47B, which sought to devolve Sections 8(1)(b), 29 and 34 to 43 of the National Health Service Act 1977 to the Welsh Assembly. In Schedule 11 they wish to empower the Secretary of State to tell the Assembly what to do and how to manage a group of affairs through giving directions. We, on these Benches, believe that the Government are under a misapprehension here, and there are a variety of reasons for this.
First, the Government are looking upon the situation of doctors, dentists and others involved in the medical services, as an industrial situation—the scene in which there is an employer-employee relationship. Although to some limited extent that may be true, there is no management function in general practice in this situation. Management is within the contract and delegated to the contractor, and the situation ends there. So under the Bill the Secretary of State is now placed in the position to legislate under Schedule 11, and to do this act without the assistance of either House of Parliament.
We believe it to be an anomaly that this situation has arisen, and I should like to draw your Lordships' attention to the very powerful speech made by the noble Lord, Lord Hill of Luton, in this regard on Thursday, 15th June. At that time, the noble Lord, Lord Donaldson of Kingsbridge, was persuaded to withdraw the Amendment which he had moved. I wonder whether the Government would like, first, to comment upon the situation as it now stands. We believe that it would be a difficult situation if the Government proceeded on the basis that they have in mind at the moment, and for reasons which have become apparent to your Lordships today.
In our earlier discussions it became apparent when we were looking at Amendment No. 106A—that was the first Amendment we discussed this morning, in which we were concerned with the powers of a Minister of the Crown to alter a statute by order—that the order would be subject to the Negative Resolution procedure. It is apparent under the Bill as drafted that ministerial powers are available (ministerial powers are naturally available to the Secretary of State) to act in a manner which he thinks fit and both expedient and necessary.
I am particularly grateful to my noble friend Lord Tweeddale for putting down this Amendment because it bore out so exactly what many of us thought about the situation as drafted in the Bill. We do not believe that it would be either prudent or desirable to alter the status quo here, and I am much reinforced by the views expressed by the Welsh Committee of the British Medical Association. They are strongly of the view that it would be not in the best interests of both the profession and the Welsh people generally if the situation were departed from as the Government have in mind. I beg to move.
1.52 p.m.
Baroness STEDMAN: May I say that it was not the Government's intention, if we arrived at it, to move Amendment No. 112A, because we did have some discussion about it, and it is linked to Amendment No. 47B which was tabled to Schedule 2 last week and was withdrawn. The Amendments which the noble Lord, Lord Sandys, has talked about are concerned with the Secretary of State's power to give directions in relation to Sections 29 and 34 to 43 of the National Health Service Act 1977. When we debated it last week, the Government's policy in relation to this power was explained in full, and the reasons why we thought it necessary to include it in the Bill. There is really nothing I can add to what was said then.
Last week, the noble Lord, Lord Sandys, was good enough to withdraw his Amendment. This left Schedule 2, Part VI as it was, thereby devolving most of the ministerial functions in the sections of the 1977 Act concerned. If these Amendments were to be carried, the directing power will be lost and the Assembly
1590
will therefore have competence to determine the terms and conditions of service, including the remuneration of general practitioners, dentists, opticians and pharmacists. I am sure this is not the effect the noble Lord, Lord Sandys, wishes to achieve; and it is most certainly not something the Government can accept given our policy that the remuneration of Health Service staff should be reserved. In the light of this explanation, I hope that the noble Lord might withdraw his Amendments.
Lord SANDYS: I regret that we are reaching a somewhat sterile situation in this argument, and I hope that it will be for the benefit of the Committee if I were to refresh your Lordships' memory over this particular problem. The noble Baroness quite rightly said that the Government have reserved their powers in regard to the remuneration of the medical profession. She included both dentists and pharmacists in that particular field. We are in considerable difficulty here because the terms and conditions and remuneration are intertwined, and I think this phrase has recurred through discussions both in another place and in your Lordships' House.
To separate these two strands is a matter of very great complexity; so much so that we believe that it would be much better if the status quo were adhered to. I think the first consideration must be for the maintenance of standards and good management within the medical professions in Wales. The Government have advanced the case that the Assembly should manage the Health Service in Wales in a manner which they think fit. While it is very desirable that they should have as large a remit as would be suitable, it appears to be extremely difficult to separate these two functions: that is, the ones I have just referred to of remuneration and the means whereby they organise their affairs.
The noble Lord, Lord Hill of Luton, put it very well. May I be allowed to take a few moments of the Committee's time to refer to column 572 of the Official Report of the 15th June. The noble Lord, Lord Hill, said:
"Therefore, I am bound to ask: if the assurance given that the intention is to sustain the standards that obtain today, why not leave the responsibility where it now is rather than engage in this

1591
transparently bogus effort of transferring the responsibility to the Assembly and then, by means of a second Amendment, nipping in with the authority of the Secretary of State who will tell it what to do? It does not make sense. May I ask the noble Lord to look at this point. We do not want unreality. We want the standards of consultants and specialists in Wales to be maintained, in the interests of the Welsh people, at the level which obtains in the Island as a whole".
The noble Lord, Lord Hill, has vast experience of the medical profession both as a Minister and also through his responsibilities in a previous Government in regard to Wales, and I think that his views should be closely adhered to. We believe that there is a distinct and apparent difficulty here which it is not possible to resolve, and I am not surprised that the noble Baroness felt that she could not add at any great length to what her noble friend Lord Donaldson of Kingsbridge said on the previous occasion. I regret from these Benches that we must sustain our position, and therefore I beg to move.
Baroness STEDMAN: I am sorry that the noble Lord has decided to press his Amendment. I accept that the noble Lord, Lord Hill, made all the comments that the noble Lord has referred to us. But my impression was that he was talking about the consultants rather than about those who are involved in more general terms in the Health Service. What we have done in Wales is to try and cope with the problem of ensuring that the Assembly has the powers it needs for the administration of the Health Service, but we have reserved to the Government the power to determine remuneration because we think it would be wrong that the Assembly should be able to dictate perhaps better or worse terms for any of the practitioners in the Health Service.
It is a complicated procedure. It is made difficult because of this linking between the Administration and the terms and conditions of services. I would have hoped that the noble Lord would not press it at this point, that we might perhaps have further discussions, and that he might talk to my advisers and see whether we can satisfy him and allay his fears between now and the Report stage, still reserving his right to come back if he is not satisfied.
Lord SANDYS: I am only too willing to consider the matter with the noble Baroness's advisers should she be willing to offer opportunity between now and Report stage. I cannot commit ourselves to alter our position on this particular Amendment, but I am only too willing to go further into the matter, and in addition to bring in those aspects which relate specifically to the Welsh Committee of the British Medical Association. If the noble Baroness feels that there is ground for further discussion on this, then I would be willing to withdraw this Amendment.
Baroness STEDMAN: Our position in the Government would remain the same. We would want to try and preserve the status quo in the Wales Bill as it is at the moment, with the Assembly being responsible for the administration and with the Secretary of State being responsible for remuneration and the terms and conditions of service. If we can ease the problem at all by discussions, well and good; if not, the noble Lord must test the feeling of your Lordships.
Lord SANDYS: We are in a difficult position here. If it is decided to divide on this issue, what the Government have drafted will be changed, and the other place will be given the opportunity to review an aspect of the Bill which has not been examined hitherto. This is a matter of very great importance to Wales. Of course we may reach the position in question in any event, should we proceed on Report. Having listened very closely to what the noble Baroness has just said, I believe that it might ultimately save both the Government's time and fruitless discussion on this side if we divide on this issue and give another place the opportunity of a very full discussion, which would permit Welsh Members of the other place to digress upon it further.
2.1 p.m.
On Question, Whether the said Amendment (No. 112B) shall be agreed to?
Their Lordships divided: Contents, 39; Not-Contents, 26.

CONTENTS

Amherst of Hackney, L.

Elton, L.

Mowbray and Stourton, L. [Teller.]

Amory, V.

Emmet of Amberley, B.

Balfour, E.

George-Brown, L.

Napier and Ettrick, L.

Balfour of Inchrye, L.

Gridley, L.

Sandford, L.

Cathcart, E.

Hailsham of Saint Marylebone, L.

Sandys, L.

Cockfield, L.

Skelmersdale, L.

Colville of Culross, V.

Ilchester, E.

Spens, L.

Cullen of Ashbourne, L.

Kinnaird, L.

Stamp, L.

de Clifford, L.

Lauderdale, E.

Swinfen, L.

Denham, L. [Teller.]

Long, V.

Trefgarne, L.

Drumalbyn, L.

Loudoun, C.

Tweeddale, M.

Effingham, E.

Lyell, L.

Vivian, L.

Ellenborough, L.

Morris, L.

Ward of North Tyneside, B.

Elles, B.

Mottistone, L.

NOT-CONTENTS

Banks, L.

Kirkhill, L.

Ponsonby of Shulbrede, L.

Beswick, L.

Leatherland, L.

Stedman, B.

Brockway, L.

Llewelyn-Davies of Hastoe, B.

Stewart of Alvechurch, B.

Collison, L.

Lloyd of Kilgorran, L.

Stone, L.

Davies of Leek, L.

Lovell-Davis, L.

Strabolgi, L. [Teller.]

Gaitskell, B.

McGregor of Durris, L.

Wallace of Coslany, L. [Teller.]

Goronwy-Roberts, L.

Murray of Gravesend, L.

Winterbottom, L.

Greenwood of Rossendale, L.

Northfield, L.

Wynne-Jones, L.

Hale, L.

Pitt of Hampstead, L.

Resolved in the affirmative, and Amendment agreed to accordingly.
2.9 p.m.
Lord SANDYS Lord SANDYS moved Amendment No. 112C:
Page 86, leave out lines 1 to 3.
The noble Lord said: This Amendment is consequential upon Amendment No. 112B. I beg to move.
On Question, Amendment agreed to.
Baroness STEDMAN Baroness STEDMAN moved Amendment No. 113:
Page 86, line 19, leave out ("laid before") and insert ("made to and published by").
The noble Baroness said: This is the last of the series of Amendments which deal with the making of statutory reports to the Assembly and their publication by them. In this case it relates to the making to the Assembly of reports of the Health Service Commissioner for Wales, and their publication by the Assembly. I should like to move that Amendment, and I think that it will be a considerable relief to Members of the Committee that this is the last Amendment on this Committee stage.
With the leave of the Committee, I should like also to take this opportunity to say thank you to the noble Lords opposite for the way in which they have handled their side of the debate, for their co-operation, for their consideration and
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for their good humour through the long hours that we have spent on it. Although my colleagues on the Bill team are not very much in evidence at the moment, I am sure I speak for all of them. I beg to move.
Lord LLOYD of KILGERRAN: Earlier today the noble Lord, Lord Elton, felicitously referred to this Committee stage as "a great historical occasion, dealing with constitutional issues of the rights of people in a great nation". As a Welshman I thank him for those words; but now this last, small Amendment has in my view an intrinsic merit fitting for Lord Elton's great occasion. It is an Amendment to remove from the Wales Bill at Anglo-Saxon phrase, "laid before the Assembly", which is characteristic of procedures in a Westminster-modelled Parliament. The Welsh Assembly will be a unique Assembly, quite different to Westminster. This Amendment therefore casts out the Anglo-Saxon phrase, "laid before the Assembly", and introduces a Welsh freshness and finality to the Wales Bill Committee stage.
May I join with the noble Baroness in praising particularly Lord Elton and his team for good humour and hard work over many hours; and may I also thank and praise Baroness Elton—I am sorry; Baroness Stedman: that shows how near we have come to agreement in this Assembly—and ask her to thank her team,

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for the great work they have done on this Committee stage.
Lord ELTON: My pleasure at the noble Lord's earlier remarks is perhaps equalled by my astonishment at his latter remark. I must say that if he is unable to distinguish the proper relationship between myself and the noble Baroness I despair of his ever appreciating the proper relationship between Parliament and the Welsh Assembly, or its local authorities. But it was nice of him to make the points that he has made, or, at least, that he intended to make.
I, too, should like to thank the Government team for playing against us, outnumbering us, as they do, with such patience. I am deeply grateful to my noble friends on both the Front and the Back Benches for displaying an astonishing versatility and an ability to master briefs which I think means that our Party is the richer for their participation. I presume that the noble and learned Lord the Lord Chancellor will not be moving the Amendment which stands in his name on the Marshalled List as No. 114, which would appear to be an expression of an opinion of the proceedings so far with which many of us would concur. I think that all Members of this Committee who have worked the really very long and arduous hours, which we have to do in addition to our normal duties, deserve the thanks, not only of myself but of the Government; as, indeed, do those who have toiled behind the scenes, working not on one but on two Bills. We too often overlook the duties which fall on the Public Bill Office and the various other departments of the House, and the
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printing agencies. All of them have supported us with great effect and efficiency.
Finally, of course, I think one should not forget the staff. This is only a half-term speech, not an end-of-term speech; nonetheless, I think the cheerful patience of the staff of the House has done much to make me return to get my feet on the floor at moments when I thought they might leave it. I think we are accepting an Amendment—I have quite forgotten where we started—but I have said what I wanted to say, and I say it with gratitude and sincerity.
On Question, Amendment agreed to.
Schedule 11, as amended, agreed to.
House resumed: Bill reported with Amendments.

HOMES INSULATION BILL
Brought from the Commons; read 1a, and to be printed.

VALE OF GLAMORGAN (BARRY HARBOUR) BILL
The Chairman of Committees informed the House that the opposition to the Bill had been withdrawn. The order made on the 24th of May last Discharged and Bill committed an Unopposed Bill Committee.
House adjourned at a quarter past two o'clock.