Sitting of 3 May 1978

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
MESSAGE FROM THE QUEEN

  DOUBLE TAXATION RELIEF
  The Vice-Chamberlain of the Householdreported Her Majesty's Answer to the Addresses, as follows:
  I have received your Addresses praying that on the ratification by the Swiss Federal Council of the Convention set out in the Schedule to the draft Order entitled the Double Taxation Relief (Taxes on Income) (Switzerland) Order 1978, and on the ratification by the Government of the Republic of Austria of the Protocol set out in the Schedule to the draft order entitled the Double Taxation Relief (Taxes on Income) (Austria) Order 1978, which drafts were laid before your House, Orders may be made in the form of those drafts.
  I will comply with your request.

PRIVATE BUSINESS
  ORKNEY ISLANDS COUNCIL ORDER CONFIRMATION
  Mr. Secretary Millan presented a Bill to confirm a Provisional Order under Section 7 of the Private Legislation Procedure (Scotland) Act 1936, relating to Orkney Islands Council; And the same was read the First time; and ordered to be considered upon Tuesday, 9th May and to be printed [Bill 118].
ORAL ANSWERS TO QUESTIONS
ORAL ANSWERS TO QUESTIONS
  TRANSPORT

    Vehicle Excise Licences (Display)
    Mr. Hardyasked the Secretary of State for Transport if he will reconsider the position of individuals who are prosecuted for failure to display vehicle excise licences even though they may have properly applied for such licences.
    Mr. Rifkindasked the Secretary or State for Transport what representations he has received concerning existing legislation that enables a motorist to be prosecuted for inadvertently failing to display a road fund tax disc on the windscreen of his vehicle; and what replies he has given.
    The Under-Secretary of State for Transport (Mr. John Horam): Prosecution for non-display of a current vehicle excise licence is a matter for the discretion of chief constables. Where a licence has expired in the last 14 days, or prior application for a new licence has been made, account is normally taken of this. However, I can tell my hon. Friend that we intend to seek a legislation opportunity to provide for a statutory defence in these circumstances.
    As for the accidental non-display of a licence, this has been the subject of very few complaints and we do not think that a change in the law is warranted.
    Mr. Hardy: Does my hon. Friend accept that many of us will be delighted by his answer, which demonstrates his acceptance that while these prosecutions may be lawful they are not regarded as just? As bureaucracy tends to be imperfect and motor cars essential, one hopes that he will be able to take swift action.
    Mr. Horam: I note what my hon. Friend says. I know that he has had difficulty in one or two cases in his constituency.
    Mr. Rifkind: May I remind the Minister of one of my constituents who successfully and properly purchased a current licence and displayed it on her windscreen, after which, inadvertently, the disc fell to the floor of her car and she found herself having no defence against the prosecution that was successfully brought against her? Will the hon. Gentleman reconsider his refusal to extend this welcome change of the law to enable a person to have a proper defence when he can prove that at the time of the alleged offence he had a valid tax disc?
    Mr. Horam: It is difficult to draw a distinction in law between an accidental matter of the sort to which the hon. Gentleman referred and a deliberate infringement. We must have regard to the common sense and discretion of chief constables. It may be that the lady should have a licence holder with slightly stronger adhesive power.
    Mr. Edwin Wainwright: Will my hon. Friend take into account the fact that one of my constituents—I think that he knows about the case—went into his garage to get a new licence holder and came out to find a lady warden making a report that the tax disc was not visible? My constituent was taken to court and fined. He appealed against that decision, but it was upheld. Does my hon. Friend agree that it is ridiculous that such an incident took place? Is he able to do something to make the change retrospective?
    Mr. Horam: I do not think that I could make it retrospective to meet my hon. Friend's constituency problem. However, we are moving in the general direction that I have indicated. Before very much longer we shall have the opportunity to give legislative back-up to what is now a long-standing administrative tradition.
    Mr. Wiggin: Will the hon. Gentleman include in the proposed legislation a provision that where the Vehicle Licensing Centre at Swansea can clearly be shown to be at fault in not having sent a reminder, the motorist be not fined? Will he ensure that where traffic wardens and others put a notice on a car to the effect that the vehicle has been sighted without a disc, that notice is in fact attached to
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    the vehicle, as that is not the case in the Metropolitan Police area?
    Mr. Horam: I am interested in what the hon. Gentleman says, especially on the second point, and I shall bear that in mind.

    Freight
    Mr. Bowdenasked the Secretary of State for Transport what discussions he has had with the general secretary of the Transport and General Workers Union concerning the transfer of freight from road to rail.
    The Secretary of State for Transport (Mr. William Rodgers): None, recently.
    Mr. Bowden: What is the present position at Didcot? How does the Secretary of State reconcile his alleged belief in freedom of choice for freight users with what has happened at Didcot in recent months?
    Mr. Rodgers: I hope that the problem at Didcot, which has been a proper cause for concern in this House and elsewhere, has been resolved. That is certainly my present understanding.
    Mr. Raphael Tuck: Would it not help the transfer of freight from road to rail if heavy lorries were forced to pay the true cost of the wear that they impose on the roads? When will that happen?
    Mr. Rodgers: Progress has been made in this direction. There is a Question on the Order Paper today about the matter. Some of the heaviest lorries do not pay their true cost yet, but I hope that they will do so. I agree with my hon. Friend that this is important.
    Mr. Norman Fowler: Is the Secretary of State aware that we, too, welcome the agreement at Didcot? Will he also make clear, however, his absolute commitment to fair competition between freight carriers throughout Britain and give an assurance that he will use all his influence to defeat such strong-arm tactics if they ever arise again?
    Mr. Rodgers: I do not think that that is the spirit in which we should now approach this problem. I want to see fair competition between road and rail. I have said so before in the House. Equally, I do not like strong-arm tactics by anyone, at any time, anywhere.

    British Railways Board
    Mr. Spriggsasked the Secretary of State for Transport when he next expects to meet the chairman of the British Railways Board.
    Mr. Rhodes Jamesasked the Secretary of State for Transport when he next intends to meet the chairman of the British Railways Board.
    Mr. Moateasked the Secretary of State for Transport when he next intends to meet the chairman of the British Railways Board.
    Mr. William Rodgers: Tomorrow.
    Mr. Spriggs: When my right hon. Friend meets the chairman, will he discuss with him the problems of investment in public transport, and especially the day-to-day investment in replacement, maintenance and improvements? Is my right hon. Friend aware that the Railways Board has given figures which show that in 1977 there was a 5 per cent. level of improvement in railways compared with an 83 per cent. level of improvement in roads? Why is there this difference between investment for improving rail and that for improving roads?
    Mr. Rodgers: Those comparisons are not entirely fair. On the whole I try to avoid them, and I like those most closely involved to avoid them, too. We have to consider the future of the railways. I want them to have a stable and central role. The chairman talks to me from time to time about this problem, which we have heard about often in the House.
    Mr. Rhodes James: When the right hon. Gentleman sees Mr. Parker tomorrow will he remind him that for the first time since time immemorial it is now no longer possible to travel directly by rail from Kings Cross to Cambridge? Is he aware that this is a matter of extreme irritation to my constituents, and even to the hon. Member for Cambridge? When will direct services be revived?
    Mr. Rodgers: I know that the chairman of British Rail follows questions and answers in the House very closely. He will be aware of the problems that the hon. Member mentions. This is an inconvenience for a number of people. Quite
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    a lot of people, however, are looking forward to the prospect of electrification the whole way.
    Mr. Dalyell: The Government have accepted the main recommendations of the Leitch Report. What is being done about the recommendation that the railways should be helped where road and rail facilities exist?
    Mr. Rodgers: It is most important that in making any decisions about major new trunk road schemes we should examine very carefully, in the light of what the Leitch Committee recommends, the alternative possibility of passengers and freight travelling by existing railway lines. A more sophisticated analysis is probably required than that available at present, but I understand the spirit of my hon. Friend's question.
    Mr. Geraint Howells: Does the Secretary of State agree that too many railway lines were closed in Wales in the late 1950s and early 1960s? Will he now urge the chairman of British Rail to consider opening some of these lines, so that we may persuade industrialists to come to Mid-Wales and other parts of the Principality?
    Mr. Rodgers: Many people would say that too many railway lines were closed in the 1950s and 1960s not only in Wales but elsewhere in the United Kingdom. That has caused problems since. I have made it clear that I do not want to see the present chairman, or any other, doing another Beeching to our railway system. I do not know whether it is realistic to expect a large number of lines to be reopened, but I am very pleased to know that a good deal of refurbishing is going on. I shall be going to the Midlands next Monday to open a refurbished urban railway line in the Birmingham area, which I hope will do a great deal for the city.
    Mr. Powell: In view of the Secretary of State's interest in refurbishing, will he draw Mr. Parker's attention to, or remind him of, the potential value to British Rail and its operations of an improvement of communications between Great Britain and Northern Ireland, particularly through Stranraer, where there is room for reopening and refurbishment, and also at Holyhead?
    Mr. Rodgers: I am sure that Mr. Parker is well aware of that and is most anxious that British Rail should get its fair share of growing freight traffic between this country and Northern Ireland.
    Miss Boothroyd: Is my right hon. Friend aware that the chairman of the Board is so busy that it takes a Back Bencher two months to get an appointment with him? When my right hon. Friend sees the chairman tomorrow, will he tell him that it is high time that his so-called experiment on the quality and price of buffet foods was made permanent and was developed on a national basis in all regions? Will he tell him also that the defeatist gloom which exudes from the management of Travellers' Fare might have been dispelled had appointments been made with individuals from outside British Rail who have a more objective and progressive attitude towards the dreary, poor quality and expensive food that is on offer?
    Mr. Rodgers: I am sure that the chairman of British Rail will take note of what my hon. Friend said. Opinions can differ about the quality of food on British Railways. Most of us have had a disastrous meal from time to time, but I can say that I have had some very good meals. I was delighted that the House responded so well last week to the speech of my hon. Friend, who suggested that to hand over British Rail catering to the motorway service area companies could be a disaster.
    Mr. Gwynfor Evans: When the right hon. Gentleman meets the chairman of British Rail, will he ask him when the electrification of Welsh railways will begin? Is the right hon. Gentleman aware that there is not even one mile of electrified railway in Wales, whereas there are more than 2,000 miles of electrified rail in England?
    Mr. Rodgers: I hope that the chairman will not take too narrow a view of the question where electrification should first take place. His job is to consider the whole interest of the nation and to make recommendations to me on the most cost-effective projects for investment. He should continue to proceed on that basis.
    Mr. Temple-Morris: When he meets the chairman, will the right hon. Gentle-
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    man remind him that last February the British Rail Pension Fund bought in Monte Carlo a clock for the sum of £87,448, no doubt much to the profit of Sotheby's, if not to the fund's pensioners? Will he remind him at the same time that there are many thousands of elderly employees and ex-employees who have no rights to widows' pensions? British Rail claims, through its chairman, that it is conducting an investigation into this. Will the Secretary of State undertake to speed up that investigation?
    Mr. Rodgers: The House has previously discussed the question of the purchase of works of art by the British Rail Pension Fund. I do not think that we should make the connection that the hon. Gentleman suggests between the policy pursued by the trustees and the problem that individual pensioners may face. I shall, however, draw the matter to the attention of the chairman.

    Cyclists
    Mr. Andrew F. Bennettasked the Secretary of State for Transport if he will make recommendations to local authorities to improve facilities for cyclists.
    Mr. Horam: We have already drawn the attention of local authorities to the desirability of making cycling safer and more convenient, both in the White Paper on transport policy and in a recent circular. We are providing extra finance for selected local authority schemes and, as my hon. Friend is aware, we recently accepted a proposal to widen the powers of local authorities to provide cycle racks.
    Mr. Bennett: I thank my hon. Friend for that answer. Is he aware that the Friends of the Earth have recently published a bicycle planning book? Will he take steps to ensure that all local authorities read that book and take positive steps to help the cyclists? Will he stop the negative attitude of local authorities which on many occasions hinders cycling?
    Mr. Horam: I am grateful to my hon. Friend for that advice and for providing me with a personal copy of the book in question. I am half-way through it.
    Mr. Forman: Is the Minister satisfied that enough is being done to enhance the safety and well-being of cyclists? Is his

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    Department looking sufficiently actively at what goes on on the Continent, where pedestrians and cyclists are generally grouped together, rather than that cyclists should have to contend with motor vehicles?
    Mr. Horam: As the hon. Gentleman will be aware, we appointed someone with sole responsibility for cycling and cycling matters in the Department following publication of the transport policy White Paper. I am sure that he will take that point of view and evidence from the Continent as well as British experience into account.

    London Transport Services
    Mr. McCrindleasked the Secretary of State for Transport what is his policy on assisting those London Transport services which serve areas of the Home Counties and which are currently in deficit.
    Mr. Horam: It is for the county councils concerned to decide whether to assist these services financially, though we have made it quite clear that, where they are not already doing so, we hope that they will. The Government support their expenditure with grant.
    Mr. McCrindle: Where there is disagreement between London Transport or the GLC and the county council in whose area the service operates, as is the case with the Epping to Ongar section of the Central Line in my constituency, is it the policy of the Department of Transport either to provide funds itself or at least to try to bring the parties together with a view to meeting the deficit?
    Mr. Horam: It is not the policy of the Department to provide funds in those circumstances. Other counties are shouldering their responsibilities—the GLC and Hertfordshire, for example. In the first instance, it is up to the local authorities and the operators concerned to get together, though obviously my right hon. Friend and I are prepared to consider any further action which may facilitate that process.
    Mr. Newens: Is my hon. Friend aware of the deep sense of grievance that is building up in the minds of people living in North Weald and the villages around Ongar at the fact that their section of the Central Line is being deprived of funds
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    which are being made available to support lines in Greater London and the Home Counties with similar problems? Will he intervene to ensure that people who are able to provide the funds get on with the job before the service dies a death of a thousand cuts?
    Mr. Horam: I note the passion in the voice of my hon. Friend on this matter, and the matter is of great concern. Essex withdrew its grant for this line when the GLC took away its grant—rightly, because it is outside the GLC's territory. Hertfordshire has come back with some money. Tory-controlled Essex should take heart from that and go ahead and do something about it.

    Channel Tunnel
    Mr. Rostasked the Secretary of State for Transport what discussions are taking place on fresh proposals to construct a Channel Tunnel.
    Mr. William Rodgers: I am not aware of any such discussions. I am certainly involved in none.
    Mr. Rost: Does the Minister agree that a direct Channel rail link could assist the viability not only of British Rail but of the Continental railway system and would therefore involve less public subsidy, apart from the longer-term energy conservation considerations? Will he give an assurance that if the EEC puts forward proposals for such a direct link, even if it is only a one-rail link, he will consider it seriously and put such proposals before the House for discussion?
    Mr. Rodgers: It probably would be in the interests of British Rail and Continental railways for there to be a fixed link between this country and the Continent. I am sure that this is in the minds of those responsible at British Rail. On the other hand, as I have previously made clear to the House, the Government's position has not changed. We cannot contemplate such a large increase in public expenditure at present, but were there to be any proposals from the European Community or elsewhere I would be prepared to consider them. I am sure that the House would also want to discuss them.
    Mr. Bagier: Will my right hon. Friend use his position in the Cabinet to press for a share of the North Sea oil profits

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    to go towards this very desirable infrastructure? Is he not aware that practically every trunk route survey which has taken place with regard to Europe and Britain has shown that whereas connections between the various Continental capitals are very good, we are separated from them by the sea? Will he fight more forcibly for the money to build this desirable piece of infrastructure?
    Mr. Rodgers: Any expenditure on building a Channel Tunnel means that that money cannot be spent elsewhere. I could not argue that a Channel Tunnel should be at the top of the list of present priorities. However, I take my hon. Friend's point. I am sure that all those who have a direct interest in such a link will be doing research on how it can best be accomplished and will be making their views clearly known.
    Mr. Costain: Will the Minister clarify the position regarding the machine which was designed to dig the Channel Tunnel? We understand that the machine was up for sale. Is it still for sale or has it been withdrawn from the market?
    Mr. Rodgers: If the hon. Gentleman wants to make a bid for it, it will be acceptable for him to do so. The problem—it has been raised before in the House—is that were the construction of a Channel Tunnel to go ahead at some time, the best judgment is that that machine is not a piece of equipment which could then be used.

    Roads (White Paper)
    Mr. Newtonasked the Secretary of State for Transport what representations he has had on the White Paper "Policy For Roads: England 1978", Cmnd. Paper No. 7132.
    Mr. Formanasked the Secretary of State for Transport what representations he has had on the White Paper "Policy for Roads: England 1978", Cmnd. Paper No. 7132.
    Mr. William Rodgers: I have received two communications which might be called representations.
    Mr. Newton: Will the Minister accept a welcome for the White Paper's reaffirmation of the need to give greater priority to the South-East and East Anglia and also the White Paper's recognition of the
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    possible need for a switch from Government schemes to local authority schemes? When does he expect to translate these hopes into cash, particularly for the county of Essex?
    Mr. Rodgers: As the hon. Gentleman knows, the appendix to the White Paper set out about 400 schemes, which are being assessed or reassessed in terms of priorities. As he says, we believe that in the immediate future industrial routes and those to the ports will be very important. I am prepared to be flexible if it is shown that local authorities need more money for capital spending while, on balance, I may need less.
    Mr. Forman: Is the Secretary of State aware that many people in my part of Greater London will welcome the fact that the first priority in the South-East, according to the White Paper, is to be given to the completion of the M23? Will he see to it that the next priority in that area is not to build the M23 north of Hooley?
    Mr. Rodgers: There is a substantial measure of agreement on that.
    Mr. Ron Thomas: The Secretary of State mentioned routes to the ports and similar installations. Will he take it from me that many people in my constituency want to urge him, as I do now, to try to ensure that more of the chemicals and dangerous substances go by rail and not by road? Where this is not possible, we should like there to be regulations which ensure that the tankers and other vehicles which carry dangerous substances are maintained effectively and inspected regularly.
    Mr. Rodgers: My hon. Friend has raised this matter before in the House. I said previously and can say again that I broadly agree with him. We should use the railways as much as possible for freight, including dangerous freight. Equally, we should make sure that for the traffic which goes by road the safety regulations are strict and are properly enforced.

    Car Parks (Control)
    Mr. Hal Millerasked the Secretary of State for Transport, what representations he has had from motoring organisations concerning his plans in the Transport Bill to control privately operated public car parks.
    Mr. Horam: Eight organisations commented on the consultation paper on additional parking controls issued by the Department last August.
    Mr. Miller: Following the discussion of the Bill in the House, has the Minister had time to reflect and is he now in a position to drop this totally unnecessary control proposed on private off-street parking?
    Mr. Horam: No, not at all. We have support from the Standing Committee, and we shall go ahead on the lines indicated. In the hon. Gentleman's constituency of Redditch new town there are about 2,000 off-street parking spaces which are all under the control of the local authorities. We wish them to exercise all that control in other circumstances which are not so propitious.
    Mr. Ronald Atkins: Does my hon. Friend agree that these controls are long overdue? New York was doing this in 1945.
    Mr. Horam: Indeed. The sort of traffic measures that we have had over the last 10 or 15 years have contributed to a better quality of life in our towns and cities.
    Mr. Norman Fowler: Would it not be better if the Minister considered London rather than New York? Is not the crucial point that in London, where these powers already exist, the scheme introduced by the old Labour-controlled GLC was overwhelmingly rejected by the public and was rightly scrapped by the incoming Conservative-controlled GLC? There is no justification for these extra powers, and the Government would get much more credit if they scrapped these proposals altogether.
    Mr. Horam: Absolutely not. There is a party political difference over what hapened in London. The Labour Party put forward proposals which had more support than the hon. Gentleman indicates, and the Tories when they came in dropped those proposals. That by no means indicates that the Tories were right.

    Railways (Catering Standards)
    Mr. Crouchasked the Secretary of State for Transport whether, pursuant to his introducing the inquiry into standards
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    in motorway service stations, he will take steps to review standards of catering on British Railways.
    Mr. Shepherdasked the Secretary of State for Transport whether, pursuant to his introducing the inquiry into standards in motorway service stations, he will take steps to review standards of catering on British Railways.
    Mr. Horam: The Railways Board has already commissioned consultants to examine various aspects of train catering and it is currently introducing experimental changes in accordance with the consultants' initial findings.
    Mr. Crouch: I thank the hon. Gentleman for that reply, but is he aware that, notwithstanding Mr. Peter Parker's statement that he lives with the realities of competition, if one travels from London to Liverpool it costs more than £5 to have dinner and 17p to have a cardboard cup of powdered coffee? How is it possible, with these prices, for British Rail to have made a loss of £2½ million on its catering last year? Does he not think that someone is being taken for a ride?
    Mr. Horam: The hon. Gentleman will know from all the publicity that prices have been reduced on some items of British Rail catering, and that is probably very welcome. There are also changes in the menus and snacks that are available. I never have the £5 meal on British Rail, though I occasionally have a very good breakfast, which is rather expensive but of very good quality. If I want some lunch, I have a sandwich.
    Mr. Shepherd: Will the Minister ask the consultants to look into two specific areas that need improvement—first, the provision of catering facilities on long-distance cross-country routes, as these are often absent, and, secondly, the absenteeism and other factors that conspire to the non-inclusion of catering facilities on inter-city trains? I am sure that he will agree that this is absolutely maddening, especially when one has scheduled one's day on the basis of having a meal on the train.
    Mr. Horam: On the journey between London and Newcastle I have occasionally been in the same predicament as the hon. Gentleman has obviously been

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    in from time to time. I note what he says with some feeling.
    Mr. Spriggs: The Question is about standards of catering, and there is no restaurant in the country that could do anything to beat what British Rail does on the route between London-Euston and Glasgow.
    Mr. Horam: My hon. Friend's wholehearted support for British Rail catering is well known and is taken very well in some parts of the House. I have had some of the best breakfasts of my life on British Rail.
    Mr. Giles Shaw: Is the hon. Gentleman aware that the answer to the question posed by my hon. Friend the Member for Canterbury (Mr. Crouch) might have been obtained if the House had seen fit to accept my Bill last week? Can he explain why some price reductions are to be found only on short-distance lines? Is he aware that coffee that has been reduced in price from 17p to 15p is to be found only on Eastern Region, on the journey to Peterborough, where the Under-Secretary lives?
    Mr. Horam: The hon. Gentleman's knowledge of these matters is clearly comprehensive. I would not go along with his solution, which is to denationalise the catering and hand it over to private enterprise and motorway caterers, such as Trust Houses Forte. Given what Egon Ronay has said about them, I do not believe that it would be an improvement.
    Mr. Beith: Is it not an abuse of the monopoly power of British Rail catering that it is not now possible to drink tea in any British Rail buffet car, because it has been replaced by a highly-priced synthetic substitute?
    Mr. Horam: I shall mention that to the chairman of British Rail.
    Mr. Park: Is my hon. Friend aware that while the staff is providing the gorgeous breakfast that he is talking about, they rarely have anyone to spare to serve the coffee and sandwiches to which he has also referred? Is he further aware that when one makes inquiries, the reply is "We do not have the staff to do it"? What is he going to do about that?
    Mr. Horam: My hon. Friend might try getting coffee and sandwiches on the station beforehand.
    Mr. Temple-Morris: If we can leave £5 menus and breakfasts for a moment, the Minister will be aware that it was recently announced that catering would command greater attention from the chairman himself, Mr. Peter Parker, and that, as a result, beef, chicken and salad would be added to the sandwich fillings. Has the Minister been into any snack bars on trains lately? If he has, he will know why more and more people are taking their own food on to trains.
    Mr. Horam: I regularly use the snack bar at King's Cross Station, and I find it quite adequate.

    British Rail and London Transport
    Mr. Hugh Jenkinsasked the Secretary of State for Transport if he will invite the chairman of the British Railways Board and the chairman of London Transport to meet him together.
    Mr. William Rodgers: If there is sufficient reason, yes.
    Mr. Jenkins: Does my right hon. Friend regard it as sufficient reason to consider the situation where London Transport trains run on British Rail lines and through British Rail stations? Will he, in particular, draw the attention of the two chairmen to conditions at East Putney station, where this occurs, and to the fact that at the station the whole thing seems to be falling between two stools? Will he ask, in particular, for passenger-operated ticket machines to be installed, at long last, at East Putney station?
    Mr. Rodgers: I am not familiar with that station, but I am grateful to my hon. Friend for drawing the matter to my attention. The London Rail Advisory Committee is seeking to get a degree of co-ordination where there has, perhaps, been too little in the past, and I shall make sure that it is aware of the problem to which my hon. Friend has referred.
    Mr. Peter Bottomley: Will the Secretary of State encourage the two chairmen to make better arrangements for British Rail season ticket holders when the train service is cancelled, so that they can use London Transport where there is a bus or Tube link?
    Mr. Rodgers: That is precisely the sort of joint arrangement that the advisory

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    committee should be looking at. It makes good sense, and I shall draw it to the committee's attention.
    Mr. Spearing: Is my right hon. Friend aware that the advisory committee has few powers and, to date, does not have a great reputation? If he sees the two chairmen together, will he point out to them that before 1947 the receipts from all rail, bus, tram and trolleybus services were pooled, and that without such a pooling system there is a clash between the revenue interests of British Rail and London Transport—a clash that is at the bottom of many of the problems that we have at present?
    Mr. Rodgers: I agree with what my hon. Friend said about the powers of the advisory committee, but not his remarks about its reputation. It is a relatively new body and it has been working well. It seeks to achieve its objectives by agreement and influence, which is the only way, given the complex problems of the city. I take my hon. Friend's point about the experiences of some years ago. They have consequences which are difficult for passengers.

    Road Haulage (Costs)
    Mr. Peter Millsasked the Secretary of State for Transport, how much he estimates road haulage costs to have increased since February 1974; and whether he will make a statement.
    Mr. Horam: By about 90 per cent.
    Mr. Mills: Does the Minister realise the terrible effect that these massive increases have in certain areas, such as the South-West, particularly for the consumer, the farmer and the industrialist? Does he realise that the Government cannot avoid taking some responsibility for these massive increases? Will he see that road haulers are not further clobbered in future—by the black list, for example? May we have the report of the Price Commission as quickly as possible?
    Mr. Horam: I pay tribute to the road haulage industry. It has been successful in offsetting higher costs with greater efficiency. I gave the figure of 90 per cent., but the figure for increased costs per tonne-kilometre is only 15 per cent. The industry has done well in coping with these rising costs.
    Mr. Walter Johnson: Is my hon. Friend aware that if the juggernauts and other lorries paid a proper economic sum towards the maintenance of motorways and major roads, the costs would increase considerably? Last year it cost £80 million to maintain these roads. This is very unfair competition for the railways.
    Mr. Horam: My hon. Friend will be aware that, overall, lorries are meeting their full wear and tear costs, with the exception of the very heaviest lorries. As he knows, we have a programme for dealing with that.
    Mr. Kershaw: Is the Minister aware that one of the components of the costs of road hauliers is the inconvenient roads, with the long delays that can result? Is he now able to announce when the decision about the Stroud inner ring road, which I was promised earlier this month, will be made?
    Mr. Horam: I thought that the hon. Gentleman would try to get that question in somewhere. I cannot give him a commitment offhand, but he will be aware of the priorities that we have given in the roads White Paper to work out suitable routes for lorries.

    British Road Services
    Mr. Michael Robertsasked the Secretary of State for Transport whether, pursuant to his reply in the Official Report, 5th April 1978, column 420, he will now make a statement on British Road Services.
    Mr. Viggersasked the Secretary of State for Transport whether, pursuant to his reply in the Official Report, Wednesday 5th April 1978, column 420, he will now make a statement on British Road Services.
    Mr. William Rodgers: I understand that the NFC agreed that this year's BRS management conference should be held in Las Palmas because it was a congenial place to go to, and good value for money.
    Mr. Roberts: Does the Secretary of State not consider that the Las Palmas trip to some degree tarnishes the reputation of a management board which has been very successful? Does not he further consider that on the rare occasions when

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    a nationalised industry feels that it has something to celebrate, it should do so in the United Kingdom?
    Mr. Rodgers: I do not agree. We have to enjoy ourselves sometime. If, as the hon. Member says, British Road Services is doing a good job of work, if it is earning a substantial profit, and if the management and workers are doing a first-class job, it is better that they should have a weekend in Las Palmas than in Cardiff, for example.
    Mr. Ronald Atkins: Is my right hon. Friend aware of the efforts that are being made in the Government by various Cabinet Ministers and by people outside to initiate a campaign to buy British? Is it not a bad start for us to hear from the Secretary of State that it is all right to buy foreign?
    Mr. Rodgers: I do not agree at all. I must be firm about this. Most of us travel abroad from time to time, for good reason. It does not mean that we do not like staying at home or buying British. Large numbers of people go abroad for holidays. Good luck to them. If this helps to motivate a nationalised industry, I see nothing wrong with it whatsoever.
    Mr. Norman Fowler: Surely the Secretary of State is ignoring the fact that over the last few years taxpayers have given a great deal of money to the National Freight Corporation. Would it not be better if it had a more economical conference and sought to repay some of our money?
    Mr. Rodgers: The hon. Member displays a pretty uptight attitude to this matter. If there is only a small difference in cost between going to Las Palmas and going to Cardiff, NorthWest—I know that there are other parts of Cardiff to which this consideration would not apply—I see no reason why the members of the management of BRS should not go there if, in their managerial judgment, it makes best sense.

    Humber Bridge
    Mr. Brothertonasked the Secretary of State for Transport what is the latest estimate of the cost of the Humber Bridge.
    Mr. Horam: The latest estimate by the Humber Bridge Board is just under £61·5 million. This cost includes the immediate approach roads, but not capitalised interest.
    Mr. Brotherton: Is the Minister aware of the concern, which almost amounts to despair, on the south bank of the Humber at the way in which millions of pounds have been hurled in to try to satisfy this white elephant, while at the same time no progress at all has been made in completing the M180 from Brigg to the ports of Immingham and Grimsby? Will he assure the House that the Government will undertake this most important job, because Immingham is the sixth largest port in the United Kingdom and has no decent road structure? Although it is too late to stop the Humber Bridge, should we not now build the necessary roads in order to look after these two most important ports?
    Mr. Horam: I take note of the despair on the south bank of the Humber. The M180 is going ahead fast. Spurs to Immingham and Grimsby will be built from the trunk road at the end. That project is making excellent progress.
    Mr. James Johnson: Is the Minister aware that the intemperate comments from the Opposition Back Bench are typical of the vendetta that is being waged by a small number of people on the south bank who still think in terms of East Yorkshire and Lincolnshire? Does he accept that the bridge will confer enormous benefits to those living on both sides of the estuary, not least people such as I, who will pay 80p to take their cars over to the old Lincolnshire—now South Humberside—thus saving 70 miles of journey via Goole? Is the Minister also aware of the invisible benefits in the form of tourism for this part of the world?
    Mr. Horam: I agree that the Humber Bridge will be a major national asset. I hope that it will bring some harmony to the relationship between the north and south banks of the Humber.
    Sir P. Bryan: Will the Under-Secretary of State bear in mind the effect that the new Humber Bridge traffic will have on the trunk roads north of the river and the consequential need for a Market Weighton bypass?
    Mr. Horam: I note that point. The hon. Member will be aware from a previous Question Time that we are looking at this matter closely. We hope to come to some clear conclusions when the Humber Bridge is completed.
    Mr. John Ellis: Will my hon. Friend ensure that until the bridge is opened the ferry service will continue? Is he aware that the "Lincolnshire Castle" has been laid off? Does he agree that it should be brought back into service? Is he aware that a clause in the Humber Bridge Act provides for the cost to be met in this situation? Should not this be done? My constituents should have some type of service until other decisions are taken after the bridge is opened.
    Mr. Horam: This is a matter for British Rail. Before it can close down a ferry service it must meet objections. There might be a public inquiry, and my hon. Friend might have a say in it. He is well protected.
    Mr. Brotherton: On a point of order, Mr. Speaker. In view of the totally unsatisfactory nature of the reply I beg to give notice that I shall seek to raise the matter at the earliest possible opportunity under Standing Order No. 1.

    Metrication
    Mr. Mawbyasked the Secretary of State for Transport what progress he has made on his consultations preparatory to a change-over from miles to kilometres.
    Mr. William Rodgers: None, Sir. As I have previously told the House, I am planning no such consultations in the near future.
    Mr. Mawby: I am grateful to the right hon. Gentleman for that reply. Has he estimated the cost of changing speed limit and information signs? Has he taken into account the fact that although the ordinary motorist here understands what the sign "30" means, if there were to be a sign "50" the letters "km", at least, would have to be included? In view of that, would it not be best to leave the whole thing alone?
    Mr. Rodgers: I am one of those who enjoy kilometres abroad and miles in the United Kingdom. That might be the view of the House. I am not looking into the detailed matters to which the hon. Mem-
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    ber rightly refers because it would be unreasonable and unnecessary to do so, at least until after the consultation has taken place.
    Mr. Molloy: Does my right hon. Friend appreciate that millions of ordinary British people also enjoy kilometres abroad but prefer miles at home? Has he considered what effect such a change could have on the export of cars to Australia, the United States, New Zealand and many other parts of the world? Could not this have a deleterious effect? Does he agree that we should not sacrifice everything in response to every demand from the Common Market Commission?
    Mr. Rodgers: We should adopt a reasonably relaxed approach to this matter. I have expressed my preference and I think that I know the preference of most hon. Members, but we must recognise that other people, particularly the younger generation, who are not as stuffy about such matters as some of us tend to be, may look at it differently. We can look at this in due course. There is no need to bother about it today.
    Mr. Stokes: Does the Secretary of State agree that those of us who were in favour of our entry to the European Community are, nevertheless, distressed that on many vital English matters we have to change our old names and go in for these new-fangled names from the Continent? Surely we want to keep our old English mile.
    Mr. Rodgers: I know that many people want to keep our old English everything. That does not mean that we should never change. But we need not worry about it too much at the moment. The consultations have not begun, and at the end of the day Parliament will decide.

    Tachographs
    Mr. Martenasked the Secretary of State for Transport if he will make a statement on the latest position on tachographs.
    Mr. William Rodgers: I have nothing to add to what I told the House on 5th and 14th April.
    Mr. Marten: If the European Court should rule that we should have tachographs and if we refuse to have them,

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    what is the court's ultimate sanction? Shall we see a type of Euro-tipstaff coming here, like Cromwell, and arresting the right hon. Gentleman?
    Mr. Rodgers: The hon. Member has put a fearful thought in my mind—a thought that was not previously there. But I do not think that we need form our final view of the state of affairs that will prevail until the European Court has pronounced. I have as yet received no firm indication that a reference has been made to the European Court by the Commission. I have seen Press reports to that effect, but this has not yet been confirmed.
    Mr. Madden: Is the Secretary of State aware that even when one finds anyone who voted in favour of Britain's remaining a member of the Common Market, he is rapidly becoming sick to death with the meddling and interference of the Common Market in our milk supplies, in whether or not we keep the British passport, in drivers' hours, in miles, and in many other matters? Will he ensure that the "spy in the cab" is not achieved by the meddling bureaucrats of Brussels?
    Mr. Rodgers: My hon. Friend uses harsh language. I think that inevitably the process of being members of the Community has brought problems and even surprises, including those of us who were very much in favour of Britain's joining the Community and remaining there. I can only say that, on the one hand, my own vision is not measured in axle weights, and, on the other hand, that I do not think that the long-term interests of this country will be affected by the sort of pinpricks which I know irritate us all when they come from Brussels from time to time.
    Mr. Temple-Morris: Before the Secretary of State is hauled away in irons to the European Court, will he tell us, by way of a fond farewell, whether he will study what the Road Haulage Association had to say about the value of voluntary agreements? What will he do to encourage this very sensible way forward?
    Mr. Rodgers: I shall certainly study that. I ought to make it quite clear that I am happy to see voluntary agreements about the use of tachographs. If both sides of the industry want to use them, why should they not do so if they believe
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    that they are an aid to productivity? What is at issue is the compulsory use of tachographs, to which a number of people take strong exception.

    M25 (Maple Cross—M40)
    Mr. Dodsworthasked the Secretary of State for Transport, in the light of recent fatalities, if he will now ensure that the Maple Cross-M40 section of the M25 motorway is constructed as soon as possible in order to alleviate the traffic conditions in Maple Cross; and if he will make a statement.
    Mr. Horam: The recent White Paper "Policy for Roads" confirms that completion of the M25 remains a top priority. As I said in reply to the hon. Member on 24th April, construction of the whole of the section between Heathrow Airport Spur and Maple Cross is expected to start in the period 1981–83.
    Mr. Dodsworth: Will the Under-Secretary indicate whether he will look at the reprogramming of different sections of this north orbital route, particularly in view of the fact that the existing section of road is funnelling traffic into the Maple Cross area and there is an urgent need for remedial works to alleviate the suffering of the residents, who are likely to undergo it for some considerable time?
    Mr. Horam: I note what the hon. Gentleman says, but I thik that the objective in the case of the M25 is to get ahead with all sections as fast as possible, and we shall carry on doing that.

    British Railways (Road Transport)
    Mr. Tim Smithasked the Secretary of State for Transport whether he will make a statement of his policy concerning the operation of road transport by British Railways.
    Mr. Foxasked the Secretary of State for Transport whether he will make a statement of his policy concerning the operation of road transport by British Railways.
    Mr. Horam: Our policy is that British Rail should be able to use the Freightliners collection and delivery vehicles after transfer, as they are used now by the National Freight Corporation. The

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    other restrictions on the use of road transport by British Rail will continue.
    Mr. Smith: Following the withdrawal of the Government's amendment in the Standing Committee on the Transport Bill, will the Under-Secretary give an undertaking that, following what he has just said, British Rail's road haulage activities will be confined to those Freightliners activities which involve delivery and collection?
    Mr. Horam: Indeed; that is absolutely our objective.
    Mr. Fox: Is the Minister aware that the road haulage industry is still highly suspicious of a Government and party that still have nationalisation in their programme? Therefore, will he be far more specific about the assurance that he has just given, because the industry feels that here is a move to switch traffic from the private sector of the haulage industry to an extended fleet owned under the nationalised sector?
    Mr. Horam: I can be absolutely specific. It is no part of our intention to do what the hon. Member has just said. The intention is perfectly plain. It is to allow Freightliners to carry on in the future as it has in the past. That is all.
    Mr. Spearing: Is it not a fact that, apart from the Freightliners road vehicles and the express parcels road vehicles, British Rail has now no road vehicles for the collection of what used to be ordinary goods traffic? As these vehicles were transferred to National Carriers, which now uses rail depots near to the railway but does not always use railway vehicles, will my hon. Friend see Sir Daniel Pettit to ascertain whether it is possible to put back on rail a lot of the traffic that was lost when the changes were made?
    Mr. Horam: I understand my hon. Friend's objective, which is to get more traffic on to rail, and we are attempting to do that in various ways.
    Mr. Fry: Will the Under-Secretary remember the drubbing that he took in Standing Committee on this point? Before we get the Government's second thoughts on this matter, will he at least make sure that he and his right hon. Friend under-
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    stand what their own civil servants are proposing in this respect?
    Mr. Horam: I do not think that any of my hon. Friends who served on that Committee would agree that I got a drubbing there. Indeed, the drubbings that we managed to hand out to the Opposition from time to time in that Committee were far more numerous. There was only one vote, I think, during the entire proceedings. That was the first vote, and it was an accident. None the less. I think that we came through it very satisfactorily.

    Road Haulage (Nationalisation)
    Mr. Peter Morrisonasked the Secretary of State for Transport what criteria he intends to adopt in his plans to extend public ownership in road haulage.
    Mr. William Rodgers: The public interest, as always.
    Mr. Morrison: Will the Secretary of State tell the House which sector of the road haulage industry he expects to be more profitable and to have better industrial relations under public ownership as compared with private ownership?
    Mr. Rodgers: If this is the implication of the hon. Member's Question, I should not have thought that the private sector of road haulage has had an unimpaired reputation in industrial relations or in any other field. I am very glad to say that for the most part it has been a success and has been contributing usefully to the health of the country. The same is true of, for example, British Road Services—notorious for holidays in Las Palmas.
    Mr. Walter Johnson: Is my right hon. Friend aware that successive Labour Party conferences have called for the nationalisation of road haulage companies with five or more vehicles specifically so that the drivers will work proper hours and the lorries will be properly serviced?
    Mr. Rodgers: My hon. Friend is quite right to draw attention to the very high standards which the public sector has set and to the extent to which it has been a pace-setter in good working practices, and I think that that is absolutely right. That is why I hope that we shall be able to build—my hon. Friend rightly draws

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    my attention to our commitment in this direction—upon the part of the road haulage industry which is already nationalised.

    Lorries (Reliability and Safety)
    Mr. Kenneth Lewisasked the Secretary of State for Transport whether he is satisfied with the mechanical reliability and safety of heavy vehicles from Europe travelling on British roads; and whether checks for reliability of these vehicles are adequate.
    Mr. Horam: Checks of foreign vehicles using British roads indicate that they are generally in a satisfactory mechanical condition. We are satisfied that within the manpower resources available the scope and frequency of checks are adequate.
    Mr. Lewis: Is the Minister aware that there is a general belief based on a certain amount of experience that many of the heavy vehicles coming in are overloaded? How can we deal with this problem in terms of taking action against their drivers and imposing fines? Does the Minister know about what happened in Northamptonshire recently, when several of them were stopped? May we have some quick method of getting them to the courts and getting action?
    Mr. Horam: I know about what happened in Northamptonshire recently. It was a very useful exercise. Unfortunately, none of the lorries stopped for being overloaded or for any other fault was foreign, apart from one, which was from Eire, and none was from the Continent. Therefore, that example does not exactly back up the hon. Member's point. However, the answer to the hon. Member's first point about what we do to prevent overloaded foreign lorries from going about their business is that we have a system of stopping them for spot checks at ports, and this works pretty well on the whole.
    Mr. John Ellis: Will my hon. Friend take on board the point that there is a problem here, in that lorry drivers and lorry owners picking up containers at ports have no way of knowing the weight of the containers? In these circumstances, would it not be more sensible to go to the docks and to check the weight of the containers? If a member of my union saw a notice saying "This
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    container is overweight", he would not move it. To be prosecuted and to lose one's licence—with the same consideration applying to the owner of the vehicle—when there is no way of knowing the weight of what is in the container is manifestly unfair.
    Mr. Horam: As my hon. Friend knows from the debate on the Transport Bill, this does not happen. There is no loss of licence if it is shown that a driver did not know what was in the container that he picked up. Rightly, the law protects the lorry driver in those circumstances. However, I take my hon. Friend's point, and that of the hon. Member for Rutland and Stamford (Mr. Lewis), that we need to take a careful look at our checking facilities in ports.

    Commuter Services
    Mr. Skeetasked the Secretary of State for Transport what representations he has had about the statement he issued jointly with the Secretary of State for Prices and Consumer Protection on commuters.
    Mr. William Rodgers: None, Sir.
    Mr. Skeet: Is the Minister aware that he has been milking the commuters in the South-East and London for a long time and that the service to Bedford has been deplorable, particularly for its state of disrepair? Is he prepared to make certain concessions, particularly in view of the report of the Price Commission? Is he also prepared to bear in mind that now that he is in the Cabinet he can get further concessions for commuters—for example, deductions against income tax for this purpose?
    Mr. Rodgers: The hon. Gentleman has more to be pleased about than some hon. Members, considering the improvements in the services between St. Pancras and Bedford which he knows are taking place. As he rightly said, the Price Commission has looked at the whole problem of commuter fares and the difficulty of deciding how much should be raised in revenue, and therefore in fares, and how much should come, in effect, from the taxpayer. It has made some useful recommendations, and the Secretary of State for Prices and Consumer Protection and I have welcomed its report. I am sure that British Rail is more anxious than

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    ever before both to improve the comfort and convenience of commuter services and to explain why they cost a great deal of money.

STATUTORY INSTRUMENTS, &c.
Ordered,
That the draft Weights and Measures Act 1963 (Potatoes) Order 1978 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Snape.]

TRADES UNIONS (FREEDOM OF POLITICAL ASSOCIATION)
3.31 p.m.
Mr. Robert Adley: I beg to move,
That leave be given to bring in a Bill to prevent a registered trade union from expelling a member from membership of the union for political reasons.
I have been in the House for nearly eight years, and this is the first time that I have presented a Ten-Minute Bill. Recent moves by three separate unions in different circumstances have caused me to take this step.
In an industry with a closed shop, if union membership is removed from someone for political reasons, that person is automatically deprived of his or her employment. I believe this to be unacceptable and I have support for that view from no less a person than the Prime Minister. In answer to a Question from me on 4th April, he said:
"I make it clear to the hon. Gentleman and to the House that I would deplore utterly, and would not find it at all acceptable, that people should be dismissed from their employment because of their political views, however objectionable they may be."—[Official Report, 4th April 1978; Vol. 947, c. 234.]
The election yesterday of Mr. Duffy on a secret postal ballot justifies one proposal which my party believes should be encouraged, if necessary by legislation—allowing the State to fund postal ballots for trade unions. I believe that my modest proposal today is another small attempt to seek a change which is needed and which would be supported by most active trade unionists.
If the Bill is opposed today, no doubt we shall hear howls from Labour Members below the Gangway about "union-bashing", "Grunwick", "George Ward" and "confrontation". None of those things is in my Bill. It relates instead to three specific events which have caused me concern.
The first is the case of the National Union of Railwaymen and the National Front. I believe that the National Front is an obnoxious organisation, but so long as it is legal, it is legal. The attempt to expel members from the NUR for their active support of the National Front is as bad—[Interruption.] I seek your protection, Mr. Speaker, to allow me to proceed with my speech.

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I believe that the idea of expelling people from the NUR and therefore from their jobs solely for participation in politics, however obnoxious, is itself an obnoxious act. People would be deprived of their livelihood on the railways and if they were members of, say, the NUR, they might find it difficult ever to get another job.
I have support for this view from no less a person than the Secretary of State for Transport. When I raised the subject of political expulsions from the NUR, the right hon. Gentleman wrote to me on 11th April:
"it is a dangerous principle for anyone to be dismissed from his employment because of his political views. This would be quite wrong."
So at least two members of the Cabinet are on my side.
I understand that British Rail's attitude is that it would not sack a person, even if he were expelled from the union, if he had been unreasonably excluded from the union. But no one can tell me who is to be the arbiter of what is unreasonable.
The second union which has indulged in political expulsion is the National Union of Journalists. Mr. Donny MacLeod of Pebble Mill has been kicked out of the NUJ. His crime in its eyes is "providing help and endorsement" to the D. C. Thomson publishing group of Dundee. He appeared in a television commercial for a company which the NUJ does not like—a company which produces such hot political publications as Beano and Hotspur.
There is as yet no closed shop in the BBC, so Mr. MacLeod is still able to work. However, I understand that if he had been employed by ITV, he would by now have found his employment jeopardised. Political expulsions of journalists, of course, amount to political censorship.
The third union is ASTMS. Here I must declare a personal interest, because Mr. Clive Jenkins is actively seeking to expel me and now a number of my parliamentary colleagues from his union. In a letter to me from the ASTMS head office on 13th April, the supervisor of the records department, a gentleman called Bill Kingston-Splatt—a name to make the Tolpuddle martyrs' blood
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course quickly through their veins—wrote to me:
"I also gather that you have been told by Mr. Jenkins that the Union does not wish to have you as a member anyway."
The fact is that Mr. Jenkins has arrogated to himself his own opinion and proferred it on behalf of his entire membership.
I wish to tell Obersturmbahnfuhrer Jenkins that ASTMS is not his property and that his wish to close down the London bank staff branch of ASTMS and therefore to deprive a number of my colleagues of union membership is a wholly unacceptable political decision taken supposedly in the name of democratic unionism. He may dislike my table manners or my choice of claret, although I suspect that he dislikes my politics. I think that he is behaving like the General Amin of the British trade union movement.
This attempt to expel people for political reasons should be challenged in the courts. People kicked out of their unions for political reasons can easily finish up as industrial gipsies, wandering around trying to find a job in some organisation which does not have a closed shop. If the closed shop goes on extending its tentacles throughout British industry, that could mean a serious situation for people who have offended the union leadership. Where do they stand under Bridlington?
Trade union affairs, like any other aspects of human endeavour, can give rise to grave misunderstandings when there is an abuse of power by the few which brings disrepute on the majority. I make clear my position—I am a supporter of democratic trade unionism, but some union leaders are, and know that they are, more powerful than the industrial barons of the past. Workers are often more frightened of offending their shop steward than of upsetting their boss.
Whereas a union should be a bastion of liberty, in many cases it is being used as a weapon of fear against individuals and their rights. The Bill seeks merely to control excesses or abuses of power. It is not designed to give rise to that overworked word "confrontation", which I suspect will be used more often in the next election by more Cabinet Ministers—including the Home Secretary,

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Mr. Speaker, who is standing next to you—than any other word.
Political explusion is a threat to liberty. I have quoted the Prime Minister and the Secretary of State for Transport. Perhaps I may end by quoting some words written in the foreword to a book entitled "The Martyr of Tolpuddle" published in 1934. They were written by the then Chairman of the TUC, Andrew Conley. Referring to the Tolpuddle labourers, he said:
"They would not be persuaded … into a betrayal of their principles nor coerced by the most vindictive punishment."
I doubt that Mr. Conley could have foreseen that those words would be used in the defence of individual trade unionists against abuse of power by unions. I therefore hope that the NUR, the NUJ and ASTMS will take note that Parliament will not tolerate people being deprived of their rights or their jobs for their political views—however odd or nasty or sordid some may think those views to be.
3.40 p.m.
Mr. Tom Litterick: I wish that in referring to D. C. Thomson the hon. Member for Christchurch and Lymington (Mr. Adley) had extended his reading beyond the Dandy and Beano. If he had, he might understand rather more clearly why journalists are so hostile to the activities of the D. C. Thomson Press, reasons which go back, I think, as far as 40 years. The behaviour of that organisation is contrary to the spirit of existing law, but I do not expect the hon. Gentleman to understand that.
I think that we all support the statement made by my right hon. Friend the Prime Minister on 4th April that no one should be dismissed from his or her job because of his or her political views. It is a simple proposition on which there should be unanimity.
I hope, too, but with less confidence, that the House will support the proposition that no one should be debarred from a job because of his political views. Conservative Members seem not to have heard of a thing called the black list, which is used widely throughout this country by employers, and has been used for generations. My own father was a vic-
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tim of it several times during his working life. My family know about the black list. My family know about being disbarred from work because of one's political views. But I have never heard one Member of the Conservative Party complain about the use of black lists of that sort. The Conservatives' concern for individual rights is a wee bit partial, to say the least.
The hon. Gentleman's demand for legislation is pointless, because the Trades Union Congress has already set up an independent review body to deal with such cases, and for closed shop situations it has a legally qualified chairman, who has been appointed after consultation with the Secretary of State for Employment and with the chairman of ACAS.
In any case, there are common law rights on which individuals can rely and which the courts will and do enforce. The unions' rules books must be lawful and must conform to conventional notions of natural justice in their administration. Above all, it is for the members of each trade union to decide who shall be members of their union, what policies it will follow, and what behaviour they as members will accept as behaviour which is conducive to the achievement of the union's policies and is in the union's interests. At the same time, they can object to that type of behaviour which in their view damages the union's interests and the fulfilment of its stated purposes. That is their clear right as members of a voluntary association.
Should the railwaymen or the members of any other union adopt rules for administrative procedures which violate natural justice, the courts can be relied upon to provide a remedy, if all of the internal appeal procedures which exist within most British trade unions, and certainly within the TUC, are proved to be inadequate.
The House has already considered exhaustively, during the passage of the Trade Union and Labour Relations Act, the question that is being raised this afternoon. The hon. Gentleman knows that very well.
Furthermore, in spite of the hon. Gentleman's quotation of the alleged case of the NUR, the House knows that he is aware of the statement made by the

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union's general secretary to a Conservative gathering on 10th April. Mr. Weighell said:
"Contrary to what the papers say, the intention is not to expel members from the union, or get them sacked, simply because they are misguided enough to become members of the National Front.
What we want to tackle is their threat to industrial peace by spreading racialist literature, holding racialist meetings and acting contrary to the basic rules of the NUR. We have many hundreds of coloured workers in the railways working amicably with their fellow men and women."
It seems that the hon. Gentleman wants those amicable relationships subverted. We might ask ourselves why. Mr. Weighell went on:
"If they"
—the racists—
"respect our rules and industrial practices and do nothing to harm our industry, they have nothing to fear, irrespective of what party they belong to and what their personal views are … There is no danger of anyone being deprived of his rights because he belongs to any particular political party. Members of the NUR, we consider, have the most democratic system of any trade union in the country."
Those of us who know something about the trade union movement know that the basic principles of trade union administration in this country are democratic.
So why has the hon. Gentleman raised the matter at all, given that he knows of all these things? It is clearly a simple attempt by an ignorant bigot—
Mr. Speaker: Order. No one's argument is advanced by personal abuse. The hon. Gentleman must give his reasons for opposing the introduction of the Bill. Personal abuse is never part of our way of life. At least, I try for it not to be.
Mr. Nicholas Ridley: On a point of order, Mr. Speaker—
Mr. Speaker: It is not customary to interrupt either speaker in a Ten-Minute Bill debate, so I shall take the point of order afterwards.
Mr. Ridley: On a point of order—
Mr. Speaker: I am not taking the point of order now. I will wait.
Mr. Ridley: With great respect—
Mr. Speaker: I warn the hon. Gentleman that unless he resumes his seat he will be forcing me into further action which I do not wish to take.
Mr. Litterick: Thank you, Mr. Speaker.
Hon. Members: Withdraw.
Mr. Nicholas Winterton: Do something decent for once.
Mr. Litterick: Having examined the hon. Gentleman's alleged arguments, I believe that it is quite legitimate for me to attempt to characterise the arguments he has put forward. It also seems to me quite legitimate at least to speculate out loud as to his motives. I suggest that they spring from a basic hostility towards trade unions.
Mr. Adley: I am a member of a trade union.
Mr. Litterick: Any stick that such people can use to beat the trade unions with will do, whether or not it approximates to the truth. They are not interested in the truth. Their concern for individual rights, which the hon. Gentleman alleges is the basis of his argument, is extremely biased, as they have never expressed any concern about the use of black lists by employers.
In other words, not only is the motion superfluous, for the reasons I have already given, but it is mischievous and tendentious, based on ignorance, and is pointless bigotry. Therefore, the House should oppose and reject the motion.
Mr. Ridley: On a point of order, Mr. Speaker. When I introduced a Ten-Minute Bill on 8th March you accepted a point of order that I had brought into the Chamber a Dispatch Box, and I of course naturally accepted your view that it would be right for the Dispatch Box to be removed from the Chamber.
I sought simply on this occasion to raise a point of order during the speech of the hon. Member for Birmingham, Selly Oak (Mr. Litterick) to the effect that his charging my hon. Friend the Member for Christchurch and Lymington (Mr. Adley) with being an ignorant bigot was unacceptable as parliamentary language.

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All that I rose to seek, Mr. Speaker, was that you should ask the hon. Gentleman to withdraw the expression "ignorant bigot" as being unjustified and unparliamentary. I hope that you will now concede that I have a right to ask that you should do such a thing.
Mr. Speaker: The hon. Gentleman is quite right to remind me of 8th March, when a point of order was raised about the Dispatch Box. It is normally our custom not to interrupt, but the hon. Gentleman is quite correct in drawing my attention to the fact that I allowed a point of order then. I apologise to the hon. Gentleman, because he was quite right to bear in mind that he had been pulled up on a point of order, and any hon. Member is allowed to draw that to the attention of the Chair. I hope that the hon. Gentleman accepts that apology.
Now to the language used by the hon. Member for Birmingham, Selly Oak (Mr. Litterick). If we descend to that language, the reputation of this House will descend as well. I think that the hon. Member will be well advised to withdraw the words "ignorant bigot". He will be
acting in accordance with parliamentary standards if he will do so.
Mr. Litterick: Having proved beyond any doubt at all, Mr. Speaker, that the hon. Gentleman—
Mr. Speaker: Order. I am not asking for another speech. I am asking for the hon. Gentleman's co-operation in withdrawing a term that is offensive in the view of the whole House, I should imagine.
Mr. Litterick: Which word, Mr. Speaker—ignorant or bigot?
Mr. Speaker: Ignorant bigot. I am not addressing the hon. Gentleman. I am asking the hon. Gentleman to co-operate.
Mr. Litterick: So be it.
Mr. Speaker: The House understands that that is a withdrawal.
Question put, pursuant to Standing Order No. 13 (Motions for leave to bring in Bills and Nomination of Select Committees at Commencement of Public Business):
The House divided: Ayes 175, Noes 181.

Division No. 194]

AYES

[3.52 p.m.

Adley Robert

Eyre, Reginald

Howell, David (Guildford)

Alison, Michael

Fairbairn, Nicholas

Howell, Ralph (North Norfolk)

Atkins, Rt Hon H. (Spelthorne)

Fairgrieve, Russell

Howells, Geraint (Cardigan)

Atkinson, David (Bournemouth, East)

Farr, John

Hutchison, Michael Clark

Awdry, Daniel

Fletcher-Cooke, Charles

Irving, Charles (Cheltenham)

Banks, Robert

Forman, Nigel

Jessel, Toby

Beith, A. J.

Fowler, Norman (Sutton C'f'd)

Johnson Smith, G. (E Grinstead)

Berry, Hon Anthony

Fox, Marcus

Jopling, Michael

Biggs-Davison, John

Fraser, Rt Hon H. (Stafford & St)

Kimball, Marcus

Blaker, Peter

Freud, Clement

King, Tom (Bridgwater)

Boscawen, Hon Robert

Fry, Peter

Knox, David

Bottomley, Peter

Galbraith, Hon T. G. D.

Latham, Michael (Melton)

Bowden, A. (Brighton, Kemptown)

Gardiner, George (Reigate)

Le Marchant, Spencer

Boyson, Dr Rhodes (Brent)

Gardner, Edward (S Fylde)

Lester, Jim (Beeston)

Bradford, Rev Robert

Gilmour, Rt Hon Sir Ian (Chesham)

Lewis, Kenneth (Rutland)

Braine, Sir Bernard

Gilmour, Sir John (East Fife)

Luce, Richard

Brittan, Leon

Glyn, Dr Alan

Macfarlane, Neil

Brooke, Peter

Goodhart, Philip

MacGregor, John

Brotherton, Michael

Goodhew, victor

MacKay, Andrew (Stechford)

Brown, Sir Edward (Bath)

Goodlad, Alastair

Marten, Neil

Buchanan-Smith, Alick

Gow, Ian (Eastbourne)

Mates, Michael

Buck, Antony

Gower, Sir Raymond (Barry)

Mather, Carol

Budgen, Nick

Grant, Anthony (Harrow C)

Mawby, Ray

Bulmer, Esmond

Gray, Hamish

Maxwell-Hyslop, Robin

Burden, F. A.

Grimond, Rt Hon J.

Meyer, Sir Anthony

Chalker, Mrs Lynda

Grist, Ian

Mitchell, David (Basingstoke)

Churchill, W. S.

Hamilton, Archibald (Epsom & Ewell)

Molyneaux, James

Clark, Alan (Plymouth, Sutton)

Hamilton, Michael (Salisbury)

Monro, Hector

Clark, William (Croydon S)

Hampson, Dr Keith

Montgomery, Fergus

Corrie, John

Hannam, John

Moore, John (Croydon C)

Costain, A. P.

Harrison, Col Sir Harwood (Eye)

Morris, Michael (Northampton S)

Crouch, David

Hawkins, Paul

Morrison, Charles (Devizes)

Davies, Rt Hon J. (Knutsford)

Hayhoe, Barney

Morrison, Hon Peter (Chester)

Dean, Paul (N Somerset)

Hicks, Robert

Mudd, David

Dodsworth, Geoffrey

Higgins, Terence L.

Neave, Airey

Douglas-Hamilton, Lord James

Hodgson, Robin

Neubert, Michael

du Cann, Rt Hon Edward

Holland, Philip

Newton, Tony

Durant, Tony

Hooson, Emlyn

Nott, John

Dykes, Hugh

Hordern, Peter

Page, John (Harrow West)

Edwards, Nicholas (Pembroke)

Howe, Rt Hon Sir Geoffrey

Page, Rt Hon R. Graham (Crosby)

Page, Richard (Workington)

St. John-Stevas, Norman

Townsend, Cyril D.

Pardoe, John

Scott-Hopkins, James

van Straubenzee, W. R.

Parkinson, Cecil

Shaw, Giles (Pudsey)

Vaughan, Dr Gerard

Pattie, Geoffrey

Shepherd, Colin

Wakeham, John

Penhaligon, David

Shersby, Michael

Walder, David (Clitheroe)

Prentice, Rt Hon Reg

Silvester, Fred

Walker-Smith, Rt Hon Sir Derek

Price, David (Eastleigh)

Skeet, T. H. H.

Wall, Patrick

Pym, Rt Hon Francis

Smith, Dudley (Warwick)

Walters, Dennis

Raison, Timothy

Smith, Timothy John (Ashfield)

Warren, Kenneth

Renton, Rt Hon Sir D. (Hunts)

Speed, Keith

Weatherill, Bernard

Rhodes, James R.

Spence, John

Whitelaw, Rt Hon William

Ridley, Hon Nicholas

Spicer, Jim (W Dorset)

Whitney, Raymond (Wycombe)

Rifkind, Malcolm

Spicer, Michael (S Worcester)

Wiggin, Jerry

Roberts, Michael (Cardiff NW)

Sproat, Iain

Winterton, Nicholas

Roberts, Wyn (Conway)

Stainton, Keith

Younger, Hon George

Ross, William (Londonderry)

Stokes, John

Rossi, Hugh (Hornsey)

Tapsell, Peter

TELLERS FOR THE AYES:

Rost, Peter (SE Derbyshire)

Tebbit, Norman

Mr. R. A. McCrindle and

Royle, Sir Anthony

Temple-Morris, Peter

Mr. Ivan Lawrence.

Sainsbury, Tim

Thatcher, Rt Hon Margaret

NOES

Allaun, Frank

Graham, Ted

Padley, Walter

Archer, Rt Hon Peter

Grant, George (Morpeth)

Palmer, Arthur

Ashley, Jack

Grant, John (Islington C)

Park, George

Ashton, Joe

Grocott, Bruce

Parker, John

Atkins, Ronald (Preston N)

Hamilton, James (Bothwell)

Pavitt, Laurie

Bagier, Gordon A. T.

Hamilton, W. W. (Central Fife)

Pendry, Tom

Barnett, Rt Hon Joel (Heywood)

Hardy, Peter

Phipps, Dr Colin

Bates, Alf

Harper, Joseph

Price, C. (Lewisham W)

Benn, Rt Hon Anthony Wedgwood

Harrison, Rt Hon Walter

Price, William (Rugby)

Bennett, Andrew (Stockport N)

Hayman, Mrs Helene

Radice, Giles

Bidwell, Sydney

Hooley, Frank

Rees, Rt Hon Merlyn (Leeds S)

Bishop, Rt Hon Edward

Horam, John

Richardson, Miss Jo

Blenkinsop, Arthur

Huckfield, Les

Robinson, Geoffrey

Booth, Rt Hon Albert

Hughes, Robert (Aberdeen N)

Roderick, Caerwyn

Boothroyd, Miss Betty

Hughes, Roy (Newport)

Rodgers, George (Chorley)

Bottomley, Rt Hon Arthur

Hunter, Adam

Rodgers, Rt Hon William (Stockton)

Brown, Robert C. (Newcastle W)

Jackson, Miss Margaret (Lincoln)

Rooker, J. W.

Buchanan, Richard

Jeger, Mrs Lena

Rowlands, Ted

Butler, Mrs Joyce (Wood Green)

Jenkins, Hugh (Putney)

Ryman, John

Campbell, Ian

John, Brynmor

Sever, John

Cant, R. B.

Johnson, James (Hull West)

Shaw, Arnold (Ilford South)

Carter-Jones, Lewis

Johnson, Walter (Derby S)

Shore, Rt Hon Peter

Cartwright, John

Jones, Alec (Rhondda)

Short, Mrs Renée (Wolv NE)

Castle, Rt Hon Barbara

Jones, Barry (East Flint)

Silkin, Rt Hon John (Deptford)

Clemitson, Ivor

Judd, Frank

Silkin, Rt Hon S. C. (Dulwich)

Cocks, Rt Hon Michael (Bristol S)

Kelley, Richard

Silverman, Julius

Coleman, Donald

Kilroy-Silk, Robert

Smith, John (N Lanarkshire)

Conlan, Bernard

Kinnock, Neil

Spriggs, Leslie

Cowans, Harry

Lamborn, Harry

Stallard, A. W.

Cox, Thomas (Tooting)

Lamond, James

Stewart, Rt Hon M. (Fulham)

Crowther, Stan (Rotherham)

Latham, Arthur (Paddington)

Stoddart, David

Cryer, Bob

Leadbitter, Ted

Strang, Gavin

Dalyell, Tam

Litterick, Tom

Summerskill, Hon Dr Shirley

Davidson, Arthur

Lyons, Edward (Bradford W)

Taylor, Mrs Ann (Bolton W)

Davies, Bryan (Enfield N)

McCartney, Hugh

Thomas, Ron (Bristol NW)

Davies, Rt Hon Denzil

McDonald, Dr Oonagh

Thorne, Stan (Preston S)

Davis, Clinton (Hackney C)

MacFarquhar, Roderick

Tilley, John (Lambeth, Central)

Deakins, Eric

MacKenzie, Rt Hon Gregor

Tinn, James

Dean, Joseph (Leeds West)

Maclennan, Robert

Tomlinson, John

Dempsey, James

McNamara, Kevin

Tuck, Raphael

Doig, Peter

Madden, Max

Urwin, T. W.

Dormand, J. D.

Magee, Bryan

Wainwright, Edwin (Dearne V)

Duffy, A. E. P.

Mallalieu, J. P. W.

Eadie, Alex

Marks, Kenneth

Watkins, David

Edge, Geoff

Marshall, Dr Edmund (Goole)

White, Frank R. (Bury)

Ellis, John (Brigg & Scun)

Marshall, Jim (Leicester S)

White, James (Pollock)

English, Michael

Mason, Rt Hon Roy

Whitehead, Philip

Evans, Fred (Caerphilly)

Maynard, Miss Joan

Whitlock, William

Evans, Gwynfor (Carmarthen)

Meacher, Michael

Wigley, Dafydd

Evans, Ioan (Aberdare)

Mellish, Rt Hon Robert

Willey, Rt Hon Frederick

Evans, John (Newton)

Mendelson, John

Willams, Rt Hon Alan (Swansea W)

Flannery, Martin

Mikardo, Ian

Williams, Alan Lee (Hornch'ch)

Fletcher, Ted (Darlington)

Miller, Dr M. S. (E Kilbride)

Wilson, William (Coventry SE)

Foot, Rt Hon Michael

Mitchell, Austin

Wise, Mrs Audrey

Forrester, John

Molloy, William

Woodall, Alec

Fowler, Gerald (The Wrekin)

Morris, Alfred (Wythenshawe)

Wrigglesworth, Ian

Freeson, Rt Hon Reginald

Morris, Rt Hon Charles R.

Young, David (Bolton E)

Garrett, John (Norwich S)

Mulley, Rt Hon Frederick

Garrett, W. E. (Wallsend)

Newens, Stanley

TELLERS FOR THE NOES:

George, Bruce

Noble, Mike

Mr. Ron Lewis and

Golding, John

Orme, Rt Hon Stanley

Mr. Doug Hoyle.

Gould, Bryan

Owen, Rt Hon Dr David

Question accordingly negatived.
Mr. Michael Stewart: On a point of order, Mr. Speaker. Can you help the House a little further with regard to the ruling which you gave just before the Division? If my memory serves me right, my hon. Friend the Member for Birmingham, Selly Oak (Mr. Litterick) did not call the hon. Member for Christchurch and Lymington (Mr. Adley) "ignorant bigot". He said that the Bill was based on ignorance and bigotry. [HON. MEMBERS: "No, he did not."] I remember an occasion when the late Sir Winston Churchill accused Mr. Attlee's Government of tyranny, conceit and incompetence. Everyone knew that it was nonsense, but no one suggested that it was out of order.
May I submit, very respectfully, that if we are too nice in which words we may or may not use, our debates will lose a certain robustness? We all know that there is a polite parliamentary equivalent for the forbidden word "lie". Can you help us? What words do we use when we are talking about an hon. Member who is an ignorant bigot?
Mr. Adley: Further to that point of order, Mr. Speaker. May I perhaps save you embarrassment by saying that I would far rather be insulted than praised by the hon. Member for Birmingham, Selly Oak (Mr. Litterick)?
Mr. Speaker: The right hon. Member for Fulham (Mr. Stewart) is one of the most senior Members of the House. He may have misheard the hon. Member for Selly Oak. He did not, what I call,
248
"attack a party". He said "an ignorant bigot". There is a world of difference between that and saying that the Opposition or Government party are this, that or the other. We have all heard it over the years.
I remind the House that the English language is a very rich language. I am quite sure that the right hon. Gentleman would be able to provide me with the necessary words if I gave him 10 minutes in the Library.

WALES BILL (ALLOCATION OF TIME)
Ordered,
That the Report [27th April] of the Business Committee be now considered.—[Mr. Foot.]
Report considered accordingly.
Question,
That this House doth agree with the Committee in their Resolution.—[Mr. Foot.]
put forthwith, pursuant to Standing Order No. 43 (Business Committee), and agreed to.
Following is the report of the Business Committee:
That proceedings on Consideration of the Wales Bill, as amended, shall be brought to a conclusion at 11 p.m. on the first of the two days which, under the Order [16th November] and the Resolution of the Business Committee agreed to by the House on 1st March, are given to proceedings on Consideration and Third Reading.

ORDERS OF THE DAY

  WALES BILL
  [ALLOTTED DAY]
  As amended, considered.
  4.7 p.m.
  Sir David Renton: I rise on a point of order, Mr. Speaker, of which I have given you notice. I am very glad to see the Leader of the House in his place. Last Thursday, after this week's business had been announced, I asked him to postpone the start of the Report Stage of the Wales Bill as there was not enough time following the end of the Committee Stage—which happened late last Wednesday night—for hon. Members to draft and table amendments for Report Stage.
  That task could not be started until we had a printed copy of the Wales Bill, as amended in Committee. We did not have that until 3 o'cock last Thursday afternoon. Also, before drafting one's amendments, it is preferable—I agree, not vital—to see the Government amendments which are put down. If one can see the Government amendments first, it may stop one from cluttering up the Amendment Paper with unnecessary amendments of one's own.
  We got the Bill at three o'clock on Thursday afternoon. But the Government amendments were not available until Friday morning. Speaking for myself, and perhaps for other right hon. and hon. Members, I was committed to being in my constituency on Friday. I had to leave on Friday morning for my constituency where I had to attend a meeting of a local government committee of which I am a co-opted member. The date of that meeting had been fixed several months before.
  I drafted my amendments on the train on Friday with a copy of the Bill—but without the Government amendments—in front of me. I checked the drafts on Friday evening and posted them on Saturday. They reached the Public Bill Office only yesterday morning. Therefore, they appear starred on today's amendment paper.
  In accordance with the usual practice you, Mr. Speaker, have not selected them. I make no complaint about that. I quite
  250
  understand the position that you are in. But I must say in passing that there have been occasions when the House has been pressed so hard on the timetable that the Chair has selected starred amendments. However, on this occasion, I think that even if you had selected my starred amendments they probably would not have been reached.
  On the Amendment Paper are seven new clauses, including one Government new clause, and 123 amendments, including no fewer than 36 Government amendments, many of which we welcome. In the short time available to you since yesterday morning—more especially, this morning—first your advisers, and then you, must have had a very hectic as well as difficult task. I shall come to that again later. You have done your task and have selected for consideration five new clauses, including the Government new clause, and 104 amendments, including all the 36 Government amendments, which are more or less automatic.
  The important thing is that your selection, Mr. Speaker, gives rise to 59 separate discussions many of which will involve debates on major matters affecting the future of Wales.
  After the Leader of the House made his business statement last week he said:
  "I fully accept that there is only a brief interval between the passage of Committee stage and proceedings to the Report stage next week."
  I interpolate there that the interval was six clear days including only three working days. This compares with a period of at least 14 days which is recommended by the Committee on the Preparation of Legislation for any Bill that is long or complex. The Wales Bill is certainly long—85 pages—and is so complex that it recasts the Government of Wales for the first time in 450 years.
  The Leader of the House went on:
  "But I believe that when the House deals with the Bill it will see that that is satisfactory."
  How can it be satisfactory? A total of 59 separate matters must be considered in one day. Some of these matters are most important. The Leader of the House then said:
  "The second day will take place somewhat later."
  We had been discussing the Report stage up to then, and I assumed that we might have a second day for the Report stage,

  251
  let alone Third Reading. But the Business Committee met shortly after that and decided that with only two days available altogether, one day should be for Report and one for Third Reading.
  The Leader of the House then tried to pour a bit of oil on obviously troubled waters when he said:
  "I hope that the House will recognise that this is the proper way to proceed."—[Official Report, 27th April 1978; Vol. 948. c. 1643.]
  I wish to ask you, Mr. Speaker, knowing the limitations of your powers in this matter to consider the very serious situation that has arisen. I contend that it is serious on three grounds. The first is that the position in which we are placed is entirely contrary to the spirit of our rules of order and our usual practice and procedure.
  The second is that Members have been placed under unwarranted and unnecessary pressure of time for drafting and putting forward their amendments. Added to this is the fact that there is an acute shortage of time for considering the amendments that have been selected.
  The third immediately concerns your own duties, Mr. Speaker. What has been done makes a mockery of your difficult and elaborate process of selection. If 59 matters of this kind are to be discussed in only one day everyone knows that with the best will in the world on the part of those who oppose the Bill on both sides of the House, only a very small proportion of the 59 matters will be discussed adequately or even reached.
  Therefore, for these three reasons I believe that the methods used by the Leader of the House are not only an abuse of our procedure but they reveal a contempt for the ancient and honourable relationship which exists between the people of England and Wales.
  Sir Raymond Gower: In considering what has been posed so ably by my right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton), I ask you Mr. Speaker to take account of the harsh combination of circumstances in this matter.
  First of all, we have the determination of the Leader of the House and the Government to force so much through in such a limited time. Secondly, there have been delays in the publication
  252
  of parliamentary papers. Third, a Bank Holiday came in the middle of the period and exacerbated the problem. Fourth there has been difficulty ensuing for Members because of the limited time between the completion of the Committee stage on Thursday and the Report stage today, bearing in mind the weekend, the non-collection of post on Sundays and the Bank Holiday. This has meant that any amendments in the post could not reach the House until Tuesday which places hon. Members and you, Mr. Speaker, in an intolerable position.
  In these circumstances the Government should have acted with magnanimity, taken a broader view of things and allocated more time than they otherwise would have done.
  Mr. Ian Gow: On Thursday last week the Leader of the House, in reply to my right hon. Friend the Member for Cambridgeshire (Mr. Pym) gave an assurance to the House in these terms:
  "Most of the Govenment amendments will be put on the Order Paper today."—[Official Report, 27th April 1978; Vol. 948, c. 1649.]
  If this is not a matter for you, Mr. Speaker, may I ask the Leader of the House through you how many Government new clauses and how many Government amendments met that undertaking which he gave last Thursday? Were there any that were not put down until Friday?
  Mr. Francis Pym: It is within the knowledge of every hon. Member of the House that the facts that have been stated by my right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton) and my other hon. Friends are accurate. The very short interval between the conclusion of the Committee stage and the Report stage and the problems that we faced last weekend are facts.
  In a sense it is almost an insult to my right hon. and learned Friend the Member for Huntingdonshire because he was invited some years ago to prepare a report on the preparation of legislation. He and his distinguished colleagues prepared an extremely important report, but so far from the Government taking any notice of it, it appears that in their handling of this Bill they have positively flouted it The way in which they have handled the Wales Bill is an insult.

  253
  Out of 84 clauses and 12 schedules that existed in the original Bil, we debated in Committee only 16 clauses and two schedules. That means that 68 clauses and 10 schedules were never debated at all. We now find that we have only one day to take the whole of the Report stage.
  We did not vote against the motion of the Business Committee because we wanted to save time. Nor did I make any counter proposals to the Business Committee to the Government's proposals to take only one day because I thought that we would have plenty of time for Third Reading. There is no way that a Report stage and Third Reading can be debated on a sensible and responsible basis in the course of two days only.
  This is a parliamentary scandal. We are being asked to put this Bill through virtually undebated in the course of this Session of Parliament. This could have been remedied if all the time that was devoted to the Scotland Bill and the Wales Bill had been devoted to the Scotland Bill alone. Then, if the Government were still in office and if they were so inclined to do this for Wales also, they could have introduced the Wales Bill in another Session. This would have been one way in which more time could have been given to the Scotland Bill.
  Of course we as an Opposition are not faced with this decision. But the fact remains that the Government have forced this guillotine through more fiercely and more constrictively than any other guillotine at any time on any Bill—
  The Minister of State, Privy Council Office (Mr. John Smith): What about the European Communities Bill?
  Mr. Pym: The Government use the European Communities Bill as their one alibi which they always quote. But I must point out that every clause of that Bill was debated. There were only 12 clauses and every single one was discussed. In the whole of the Wales Bill only 16 clauses were debated. That is not the way to conduct a constitutional change of this kind. There is no precedent for a guillotine of this kind on a Bill as far reaching as this. Parliament should appreciate what is being done. What is being done is neither parliamentary nor democratic. The Government are faking
  254
  the attitude "We are the masters now" and it is an absolute scandal.
  Mr. Tam Dalyell: Further to that point of order, Mr. Speaker. If more time had been found for the Scotland Bill, and had the time we have spent on the Wales Bill been devoted to the Scotland Bill, nothing would have happened other than that more manholes would have been found, as indeed the Lords are now finding. It just goes to show how unworkable is the Scotland Bill.
  Mr. Speaker: I have listened with concern and careful interest to the right hon. Member for Cambridgeshire (Mr. Pym), the right hon. and learned Member for Huntingdonshire (Sir D. Renton), and the hon. Members for Barry (Sir R. Gower), Eastbourne (Mr. Gow) and West Lothian (Mr. Dalyell). They will understand that I am bound by the rules of the House. It is impossible for me to rule on the spirit of our rules, although I try to interpret them as generously as I can when it lies within my power.
  Today, the amendments have been selected. There are a large number of such amendments, and it is not for me to comment on the points made about the number that are likely to be discussed.

  WALES BILL
    New Clause No. 1

      COMMENCEMENT
      '(1) The preceding provisions of this Act shall not come into operation until such day as the Secretary of State may by order appoint.
      (2) Different days may be appointed under this section for different provisions of this Act and for different purposes of the same provision.
      (3) An order under this section may contain such transitional and supplementary provisions as appear to the Secretary of State to be necessary or expedient, including provision for expenses to be defrayed out of moneys provided by Parliament.
      (4) The first order under this section shall not be made unless a draft of it has been laid before and approved by resolution of each House of Parliament.'—[Mr. John Smith.]
      Brought up, and read the First time.
      Mr. John Smith: I beg to move, That the clause be read a Second time.
      The clause arises because Clause 82 of the Bill was defeated in the clause stand part debate. The House will recall that when that clause was defeated there was

      255
      a combination of disparate interests which led to the Committee reaching that conclusion. However, the result of the deletion of Clause 82, as it then was, of the Bill would be that devolution would come into effect in Wales immediately on Royal Assent, thus requiring devolved subjects to be handed over to a non-existent Assembly. That clearly would be nonsense.
      Mr. Nicholas Edwards: Assuming that the Government win the Third Reading vote.
      Mr. Smith: The Opposition are making remarks about Third Reading. We shall have to await that situation. I see no ground for their unfounded confidence in that respect. We understand that the Conservative Party does not favour any devolution for Wales. But I do not think that it would dissent from the proposition that, if the Bill receives Royal Assent, a referendum should be held to ascertain the views of the Welsh people before devolution is implemented. I understood that the Conservatives had at least confirmed, if not revealed, that policy in the debates in Committee.
      Without sensible commencement provisions, the holding of a referendum before the implementation of this legislation would not be possible. The Government have tabled New Clause No. 1 to repair the damage that was inflicted, perhaps accidentally, in Committee. [HON. MEMBERS: "Oh!"] That was the effect of the vote that was cast. It cast out all the commencement provisions, and I am drawing that situation to the attention of the House by way of explanation.
      I wish to draw attention to subsection (4) of the new clause, which provides the usual affirmative resolution procedure for the first commencement order. This replaces the earlier proposal which was in the Bill in Committee, which was the subject of a certain amount of mild criticism and which applied the special affirmative resolution procedure prescribed in Clause 71. The Government thought it right to make this change in the light of the views which have been expressed. For the sake of consistency we shall be moving a later amendment, No. 45, to make a similar change in subsection (3) of Clause 80 which deals with the referendum.
      I hope that the House will find my explanation reasonable. It is necessary
      256
      to make the Bill sensible, and we are accepting the criticism that was made by the Opposition.
      Mr. Pym: The Minister tried to continue the impression of confusion which existed following the defeat of the original Clause 82. When that provision was defeated, a certain amount of guidance was given to the effect that there was some confusion and nobody knew what was being done. Nothing could be further from the truth.
      The Under-Secretary of State for Wales (Mr. Alec Jones): Nonsense.
      Mr. Pym: That is true, and it is no use the Under-Secretary of State for Wales saying otherwise. Our criticism of the original Clause 82 was confined to the heinous provisions regarding the House of Lords and the power which was to be taken in those provisions for this House to be able to overrule the House of Lords. We were totally opposed to that step.
      Having succeeded in what I grant was a strange alliance in knocking out the original clause, it is now before the House in an amended form. It would be churlish of me not to welcome it, because it meets the point that we put forward. We welcome Amendment No. 45 because it takes the provisions to which we had such strong objection out of what is now Clause 80. We regard that as a right and proper change.
      Clause 71, as it now is, which empowers this House to overrule another place, now applies only to the override powers in Clauses 34 and 35. All the other subordinate legislation provided for in the Bill can now be proceeded with in the normal way. For Clauses 34 and 35 alone, however, the Bill still takes power to enable this House to overrule another place. We think that that is wrong because it envisages a situation in which the Government may try to oppose the views both of the elected Assembly in Wales and of the House of Lords It may seem an unlikely set of circumstances, but those are the circumstances envisaged.
      The situation in regard to Clause 35 is even more undesirable. Under those provisions the Secretary of State could, if he wished to do so, use his party majority in the Commons to nullify a

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      subordinate instrument legally passed by the Assembly under the devolved powers given to it by the Bill. If the Assembly had not been established, I think the position would be that one subordinate instrument could be revoked by another such instrument only by a vote in both Houses of Parliament confirming the new instrument. It is only Clause 71 of the Bill that dispenses with that need, and we think that is wrong.
      I ask the Government please to reconsider that provision in relation to Clauses 34 and 35. We know that another place, in dealing with the Scotland Bill, has moved a most important amendment about these provisions as they relate to Scotland, and the Government have been sensitive to the proposition that both the Scotland Bill and the Wales Bill should, so far as practicable, be on the same basis. Although I am sure that the Government will take deep cognisance of what another place decides to do, I hope that there is yet a possibility that these provisions in respect of the powers which the Government wish to take to overrule the House of Lords will be reviewed.
      I also hope that in addition to the new clause, which we welcome, and Amendment No. 45, which again we welcome, this change can be extended to the override powers. We believe that the Government would be right not to attempt any constitutional change in respect of Parliament by means of the Wales Bill. In that spirit we are prepared to let the new clause go through, and we are grateful to the Minister for putting it forward.
      Mr. Ioan Evans: I am glad that the Government have tabled the new clause. However, I do not welcome Amendment No. 45. The nationalists have succeeded in dragging the House of Lords into the consideration of these provisions.
      It was said earlier by the right hon. and learned Member for Huntingdonshire (Sir D. Renton) that we could have 59 separate debates. It is a pity that we have to have such a long debate on this clause, because this discussion could have been avoided if these provisions had been accepted, possibly as amended, in Committee. I am not sure whether there was confusion in the minds of Conservative Members, but there must have been some
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      confusion in the minds of Plaid Cymru Members. They must have been ignorant, stupid or confused. I leave them to choose which it was, but they must have been in one of those states. They held up the debate that we could have had on the referendum by filibustering on the various amendments which they introduced. They did so to prevent what they thought was to be a vote on the minimum requirement when the Government had already given an assurance that a vote would take place. The fact that the Government had said that there was to be such a vote should have prevented the nationalists from adopting their filibustering tactics.
      4.30 p.m.
      There was a serious attack on the Bill. There are various interpretations, but the interpretation that the nationalists have put forward is that if no attempt was being made to replace the clause the people of Wales would have been denied the opportunity of a referendum.
      Mr. Dafydd Wigley: That is right.
      Mr. Evans: The hon. Member for Caernarvon (Mr. Wigley) agrees. It is strange that he and the hon. Member for Carmarthen (Mr. Evans) tried to take some of us to task because we did not support a referendum Bill in 1969 when by their recent actions they were seeking to deny the people of Wales having a referendum as a consequence of the Bill passing through Parliament without the original clause. When the time comes, nationalist Members will have an explanation to make to the people of Wales. The whole purpose of their vote in Committee was for this measure, once it received Royal Assent, automatically to be put into effect without the people of Wales being consulted.
      Mr. Gwynfor Evans: The hon. Gentleman attacks us for trying to get rid of the referendum and for the criticism of him and some of his colleagues for voting against a referendum 10 years ago. However, he knows very well the reason for our opposition to the referendum that is now proposed. Our opposition stems from the inclusion of the wrecking device which means that 40 per cent. of the total electorate will have to be involved before the referendum is

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      valid. In the referendum which was proposed earlier, and in the Common Market referendum, it was the majority that carried the day. That should happen in a normal democracy.
      Mr. Wigley: Absolutely right.
      Mr. Ioan Evans: We have had some clarification. I understand that the nationalists are opposed to the referendum because there is a minimum requirement. It is strange that they were prepared to vote for a one-third minimum requirement.
      Mr. Wigley: In preference to 40 per cent.
      Mr. Evans: However, they voted for a one-third requirement. It seems that the argument was not about a minimum requirement. They accepted the minimum requirement. Therefore, the argument is between 33⅓ per cent. and 40 per cent. The argument is about 6⅔ per cent. Apparently that is the whole purpose of the nationalists, who say that they are opposed to a referendum as a means of putting the issue before the people of Wales.
      Mr. Wigley: The hon. Gentleman will appreciate that with the 40 per cent. threshold fair play starts if there is a turnout of over 80 per cent. and that with a 33⅓ per cent. threshold, fair play starts with a 66 per cent. turnout. In other words, fair play starts lower rather than higher.
      Mr. Evans: I am glad that we have it on the record. We now know that the nationalists are opposed to a referendum in Wales. Their intention in Committee was not that of the Conservative Party, whose Members voted against the Government on the ground of the provision relating to another place. That is the point that they were making. We now know that there was a deliberate attempt by the nationalists to oppose a referendum in Wales because a 40 per cent. minimum requirement was put in the Bill.
      Mr. Emlyn Hooson rose—
      Mr. Evans: I hope that the hon. and learned Member for Montgomery (Mr. Hooson) does not wish to join the nationalists on this issue. Is he opposed to a referendum?
      Mr. Hooson: Why does the hon. Gentleman fight his battle with the nationalists in the House rather than at the hustings?
      Mr. Evans: The reason is that the nationalists are getting fewer and fewer at the hustings at Aberdare. Every time there is a by-election, we remove them. There are fewer and fewer on the council. We had six nationalists on the county council from my constituency but now there is only one. The argument against them must not be advanced only at the hustings. It must be engaged in on the Floor of the House. If we are not careful, we shall be getting mini nationalism. There are other ways of tackling and getting rid of the disease apart from immunising ourselves with a part of the disease. We shall get rid of the disease of nationalism only by speaking clearly against it at every opportunity.
      The new clause is relevant and important. The original clause was a vital part of the Bill and, in effect, we now have it back. Are we to find that the nationalists will once more be opposed to the clause?
      Mr. Wigley: Yes.
      Mr. Evans: It seems that they will be. That is interesting. That which is embodied in the new clause forms a major part of the Bill. The nationalists should not talk about our opposition to devolution. By their opposition to the new clause—they are consistent because they will be opposing it tonight—they are undermining an important part of the Bill.
      If the hon. Members for Caernarvon and Carmarthen did not act in ignorance, they acted definitely and deliberately. They have said that Clause 82 was of enormous significance as it provided the facility for the referendum. I questioned whether the referendum would take place without that clause. It seems that the nationalists are afraid of the issue being put before the people of Wales.
      Clearly, there should be a consultative referendum. It is good sense that there should be a minimum requirement. It is debatable whether the requirement should be one-third, for which the nationalists voted, or 40 per cent. The nationalists have issued their nonsense about dead votes being calculated, but the terms of the referendum merely provide that those

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      who are entitled to vote should be taken into account and that, whatever is decided in the referendum, it will be for the House to decide what action to take. It is not a mandatory referendum. It does not follow that any particular action should necessarily flow from it. The hon. Members for Caernarvon and Carmarthen do not seem to take on board that it is a consultative referendum.
      There are two arguments. One argument concerns the merits and demerits of the Bill. We have not had much time to go into that argument. The second argument is whether the people of Wales want the Bill. That is why it is important that we should have a referendum. Some of my hon. Friends challenge whether the people of Wales want the Bill. That is why it is vital that the people of Wales should be asked for their opinion. They should be asked whether they want the proposals that the Government have put forward.
      In their heart of hearts, the nationalists do not want devolution. They believe in separatism. They want an independent Wales. The whole purpose of their party is to create a separate political and economic system for Wales. It is for that that they stand.
      Mr. Deputy Speaker (Mr. Bryant Godman Irvine): Order. It is difficult to find all this in New Clause No. 1.
      Mr. Evans: Without the clause there would be no referendum. I dislike much of the Bill, but it is important that the people of Wales should be given the opportunity of choosing. The nationalists have said that they knew what they were doing, but 1 am trying to demonstrate that they were ignorant on the night when their amendment was carried. They objected to the minimum requirement being written into the Bill. We have heard from them now that they do not want the referendum now that a minimum requirement has been set.
      Mr. Wigley: I am sure that the hon. Member for Aberdare (Mr. Evans) was not trying to mislead the House in saying that there will be a consultative referendum. Clause 80, as it was amended in Committee, in dealing with the Secretary of State's actions after this loaded referendum, provides that he "shall lay before Parliament" the draft of an order.
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      When I raised this matter on a point of order in Committee, I was told by the Chair that the referendum was not consultative but was binding and that there was a precedent for it in the Scotland Bill.
      Mr. Deputy Speaker: I hope that the hon. Member for Aberdare (Mr. Evans) will not follow that hare down its hole but will continue on the basis of what is strictly in New Clause No. 1. He may have his opportunity of debating wider issues tomorrow.
      Mr. Evans: We see now that the hon. Members for Caernarvon and Carmarthen are confused about the Bill. We can possibly expect clarification from them later.
      I welcome the provisions that New Clause No. 1 will reinsert in the Bill. The SNP Members are not here to filibuster on this issue. No doubt they are licking their wounds after the results in the elections in Scotland yesterday.
      I do not believe there has ever been a surge of nationalism in Wales. I believe that in Scotland it was only a temporary phase. We see from the results in Scotland that nationalism has only briefly reared its ugly head, rather like the Loch Ness monster. The tide of nationalism is a figment of the imagination, not a reality.
      I hope that the House will agree to the clause and I hope that the Conservative Party will support it. I shall be most interested to discover what the Welsh nationalists do in the Division Lobbies tonight.
      Sir Raymond Gower: I welcome the new clause. I also welcome the Minister of State's explanation and, on the whole, the manner in which he made it. I particularly welcome subsection (4) because its wording is much more consistent with the sort of procedure that we normally use in such matters. I am glad, too, that the Minister of State gave an assurance about Amendment No. 45, which is consistent with subsection (4).
      I therefore give a generous welcome to all that the hon. Gentleman said up to that point, but his reluctance to amend Clauses 34 and 35 is at variance with his actions on New Clause No. 1. There is considerable inconsistency in maintaining the procedure which now is to remain

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      in Clauses 34 and 35. Under that procedure, the need for the other place to give its assent is side-stepped. It is a back-door method of changing our constitutional arrangements. The unwillingness to change Clauses 34 and 35 means that, in spite of the new clause, that procedure will be retained in a small part of the Bill. It would be much more sensible to secure a consistent approach both in the Bill and in our general procedures by amending those clauses. That would overcome our objections, which are based not so much on the superior merit of that procedure but on the belief that this is the wrong way to change our constitutional arrangements.
      Like the hon. Member for Aberdare (Mr. Evans) and the two hon. Members who intervened in his speech, I am in favour of the procedure in the new clause and the referendum which it makes possible.
      4.45 p.m.
      Mr. Dalyell: For the sake of my good name—at least, my good name with my hon. Friend the Minister of State—I had better establish immediately that I was not a member of the unholy alliance which caused the occasion which gave rise to the new clause. I am a little concerned, however, about the phrase:
      "until such day as the Secretary of State may … appoint ".
      I am concerned that enactment of the Bill could be delayed until such time as the Secretary of State in
      his judgment felt that it was required.
      I shall not refer at anlength to yesterday's events in Scotland, but I am entitled to point out that candidates who were as anti-Assembly as I am did unprecedentedly well. Before I am checked by my hon. Friend the Minister of State, I should point out that the pro-devolution Labour candidates—and, I understand, the pro-devolution Tories—also did well. I therefore make no comparison in that respect.
      After about 70 hours of canvassing at weekends over the past five weeks, some of us are clearer than ever that, whatever caused the election results, devolution was not at the top of the list.
      Mr. Nicholas Edwards: May I inquire whether the hon. Member's colleagues on the Labour Benches are away convassing
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      today? Once again, the hon. Gentleman is alone on the Labour Back Benches. Not one Welsh Labour Member of Parliament is prepared to come in to support his Front Bench.
      Mr. Dalyell: It must be that once again my opinion represents the undisputed unanimous opinion of the Labour Back Benches present. Certainly that gives me confidence in what I intend to say, and before that confidence is exhausted let me say that I refer not only to the good results in West Lothian but also to people like such as Councillor Ronald Young of Strathclyde, who chaired the Labour "Vote No" campaign in Greenock and who also had a thumping victory.
      Is it possible that if, in the light of future political events, after our discussion, much of which has seeped through from the House of Commons and the House of Lords to the Scottish public and, doubtless, to the Welsh public too, it then seems appropriate—and it is not dishonourable for people to change their minds, because after four years we all know a great deal more than we did—we could then decide not to go ahead with the Act? I hope that the answer is "Yes". I have a dreadful suspicion that it may be "No", but I pose the question nevertheless.
      We now seem to be in the fantastic position of handing to Plaid Cymru and the SNP what they want when, for the present at least, they seem unable to achieve those objectives through the ballot box.
      I have another question to ask. This applies to Wales as much as to Scotland. Some of us are curious about how many of those councillors—Labour or Conservative—who were elected after strenuous campaigns and by the sweat of their political brows will say "After all our work, having established ourselves for four years in these powerful regions, we want our powers usurped by an Assembly." I suspect that, human nature being what it is, once those councillors are elected in positions of great influence in the regions, they will hardly say that they support the Assembly.
      The Minister of State may say that I should know now, on the forty-second or forty-third day, that the Assembly will

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      not meddle in regional, district or local government. But everybody who discusses this matter, on whatever side of the argument he is, refuses to believe Ministers when they say that Assemblies will not very soon begin to meddle in local government. What else are they to do, given the limited nature of their powers? Heaven knows what a Welsh Assembly in particular will do other than meddle in matters that rightly belong, to local government in Wales.
      We do not know, even at this stage, whether the Assembly is to be full-time or part-time or what the rewards are to be and the answers to all the practical nuts and bolts questions concerning those who may be going to the Coal Exchange if the Bill is passed.
      At this stage, particularly after the events of yesterday and looking forward to what may happen on Thursday in elections in Wales, we should not embark on what would be the break-up of Britain.
      Mr. Wigley: There are no elections in Wales on Thursday.
      Mr. Dalyell: That means that even more attention should be paid to the Scottish results. We should not contemplate the break-up of Britain for ephemeral wishes which may have come from last year's "Bradshaw". I am joined by two of my hon. Friends who are as anti-devolution as I am.
      In all the days and nights during which the Bill has been debated, the House of Commons has done nothing other than do its job properly. It has exposed the very nature of the matters that we are discussing. Therefore, I hope that I can be told the position of the Secretary of State on the matter. It would be a crying shame if, somehow or other, these measures were to get the imprimatur of the House of Commons and if the impression were to be given that somehow it had got through the parliamentary machine and that the elected Members of Parliament had approved of what was being put before the electorate. That would be a false impression of the debates and of the events that have taken place in the House. That is why I ask whether a Secretary of State would have the power not to recommend the Bill to the electors in a referendum.
      Mr. Wigley: This is a far-reaching clause, as the hon. Member for Aberdare (Mr. Evans) has said. It appears to reach to the regional elections in Scotland and to many other areas.
      It is interesting that the hon. Member for West Lothian (Mr. Dalyell) said that the only way of supporting the moderate Assembly in Scotland and the even more moderate Assembly in Wales is by supporting the nationalists. That is the only vote, in the way in which he interprets yesterday's results, that can justify the existence of the Assembly. That is an interesting proposition. It will be interesting to those in the Labour Party in Scotland and in Wales who see that if they are to be judged as supporters of any form of devolution, autonomy, self-government or Parliament they will have to support the nationalists before hon. Members such as the hon. Member for West Lothian will believe that they are serious and know what they are doing. I am surprised that the Minister did not intervene to contradict what was said by his hon. Friend.
      A vital point was raised by the hon. Member for Aberdare before he was ruled out of order. It is important to set the record straight. On 19th April, the Chairman in Committee ruled on the basis of a ruling in 1975 that a mandatory provision in the Scotland Bill and a similar mandatory provision in the Wales Bill were in order and that the provision that the Secretary of State should do this, that or the other was a mandatory provision. That is a change in the constitutional practice in regard to the two Bills.
      I accept that after the Secretary of State has laid something down in the House the consequences are not mandatory, but that first step is mandatory. It has been challenged and has been upheld. All I say in passing is that that is a new concept of a referendum.
      I should like to explain why Plaid Cymru will maintain its opposition to the new clause. I am even more opposed to it now than I was to it in its original form in Committee. Since the Committee stage, the Government have made a further change. They have made a further move backwards down the slippery slope of compromise to their own Back Benches and to the Conservatives in allowing the House of Lords to overrule provisions in the Bill. I am surprised

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      that they have found it necessary to make that concession. I can only imagine that they were afraid of losing the Bill on Third Reading if they did not make the concession. I imagine that they thought that there would be an unholy alliance between Conservative Members and Members of the Labour Party, who would not have swallowed the Bill without this type of provision being made in the new clause.
      None the less, I do not see why it was necessary to do this. The Conservative Party, in following us into the Lobby on the Division that we pressed in the clause stand part debate in Committee, did so for erroneous reasons. It did so because it had not followed the logic of the Bill as it stood then, particularly the provisions of Clause 2(4), which says:
      "An order under subsection (1) above shall not be made unless a draft of it has been laid before, and approved by resolution of, each House of Parliament."
      The provision already existed. It was unnecessary to find this rabbit to chase and to give the Government the need to make a concession, unless the Opposition were finding an excuse for voting against Clause 82, having done so without realising the implication of its vote.
      However, we were opposed to Clause 82 for the very reasons eventually given by the hon. Member for Aberdare, namely, that we are opposed to a referendum which was built into it a loaded provision of a 40 per cent. threshold which will make it difficult for the people of Wales to pass the Bill. It was not a provision which was required in the EEC referendum, the constitutional implications of which were more far-reaching than those of the Wales Bill or the Scotland Bill. It is not a provision which has been built into the Sunday opening referendum in Wales, which is the only other referendum that we know.
      Had that provision been built into the Sunday opening referendum, as I was told in an answer to a parliamentary Question a few weeks ago, not one of the counties in Wales would have Sunday opening. The 40 per cent. provision would have been an insurmountable barrier—the sort of insurmountable barrier that opponents of the Bill wish to see built into the Bill to ensure that the people of Wales do not get the
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      Assembly even if they vote for it by a straight majority.
      The opponents of the Bill are so fearful of not winning on a straight vote that they need to rig a referendum in this way to achieve the result they seek. If that is not so, for what other reason would they have inserted the new clause into the Bill?
      Mr. Ioan Evans: The hon. Member for Caernarvon (Mr. Wigley) is trying to rewrite history. He is now trying to find justification for the action that he and his hon. Friends took in Committee. How does he explain that he sought to delete the clause and succeeded in doing so before the House proceeded to take a vote on the minimum requirement? How can he argue that it was because a minimum requirement had been written into the Bill when the House proceeded to take the vote after it had voted on the clause?
      5.0 p.m.
      Mr. Wigley: We did it in the knowledge—we would not have done it otherwise—of the assurances given by the Government to their Back Benchers at the beginning of the debate that, even if no time were available for moving the amendment, the Government would adopt the 40 per cent. threshold amendment—the barrier, the loaded referendum provision—in order to facilitate matters for the honourable rebels on the Labour Benches and Conservative Members.
      Mr. John Smith: The hon. Gentleman must not say again that the Government supported the 40 per cent. provision. They did nothing of the kind. They allowed the House of Commons the opportunity to take a decision and they opposed the proposal vigorously. The sooner the hon. Gentleman stops suggesting things that are quite false, the more respect he will be held in.
      Mr. Wigley: The Minister should listen to the words that are used. If he listens to the tapes, he will hear that I said that the Government moved the new clause—and they did so. There were 101 other clauses that they could also have moved if they felt it necessary to give this great prerogative of democracy for clauses that have not been discussed because of the guillotine. But they did not choose to make this generous provision to their own Back Benchers and

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      to the Conservatives on any other clauses. They did not do that on all the other important amendments that were not discussed because of the guillotine.
      It was on this one provision only that the Government found that they had to capitulate and to give with one hand what they tried to oppose with the other. They went through the pretence of opposing it with a feeble Whip and ended up with a majority of 72 against them. The Government knew what they were doing in allowing this provision through. If it were not done with their eyes open, the Government are more blind in this matter than I have supposed.
      Mr. Ioan Evans: The hon. Gentleman is deliberately distorting the whole situation. The only action that the Government took was to give Back Benchers the same facility as they had given to my hon. Friend the Member for West Stirlingshire (Mr. Canavan) on the Scotland Bill. Although the House had decided in Committee on that Bill to write in a minimum requirement, after debating two minimum requirements, the Government allowed my hon. Friend to move the deletion of that minimum requirement. They have done no more than that on this occasion. The Government's responsibility is surely not just to put their policy but to allow the House to take the correct decision. On the Scotland Bill, the House reaffirmed its previous decision. In Committee on this Bill, the House of Commons was given the opportunity to vote on the minimum requirement.
      The hon. Member for Caernarvon (Mr. Wigley) is opposed to a referendum, and he filibustered in Committee to deny hon. Members the opportunity to write in a minimum requirement. He succeeded in denying—
      Mr. Deputy Speaker: Order. The hon. Member for Aberdare (Mr. Evans) has already made one speech.
      Mr. Wigley: I am grateful to you, Mr. Deputy Speaker, though I was happy to let the hon. Member for Aberdare hang himself.
      The truth is that the Government have not made an attempt on this Bill to get rid of the provision which was inserted in Committee as they did with the amendment of the hon. Member for West Stir-
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      lingshire (Mr. Canavan) on the Scotland Bill. They have been happy to live with the provision on Report in a way that they were not on the Scotland Bill. That is as far as their democracy goes.
      If democracy were so important on this clause in the Wales Bill, why was it not equally important on both Bills on provisions such as the amendments setting out a second question—the alternative of full self-government—or the many other provisions such as the amendment of the hon. Member for Bedwellty (Mr. Kinnock) providing for controls over the money that is to be spent on the referendum? Why were those matters not important enough for the Government to give time for them?
      If it is important for the Government to give time for all this democracy to be facilitated, as the hon. Member for Aberdare suggests, presumably he will always vote against any guillotine, because the inevitable consequence of a guillotine is that important matters will not be discussed.
      To come back to the 40 per cent. amendment that the Government moved, it is interesting to note that they did not facilitate the 33 per cent. amendment which was also on the Amendment Paper. They could easily have moved it. The hon. Member for Aberdare led us to believe that it would have been a reasonable amendment to put into the Bill. The Government chose not the 33 per cent. amendment, which would have allowed a straight referendum on a turnout of about 66 per cent., but the 40 per cent. amendment requiring an 80 per cent. turnout for fair play, which was the worse of two evils.
      The only logic that the Government could have had for doing that was that they were in a straitjacket and had been given an ultimatum by their own Back-Benchers that they would lose the whole Bill if they did not do this or if they were so wedded to the concept that the Wales Bill and the Scotland Bill must be identical that they thought this was necessary—though they saw it right only a few months earlier to split the two Bills and to give Wales none of the legislative power that was given to Scotland.
      Mr. Dalyell: What does all this prove other than the magnanimous generosity of the Government towards those who disagree with them?
      Mr. Wigley: I missed what the hon. Gentleman was saying, but I take it that he was suggesting that there was magnanimous generosity in this one instance. I cannot understand why it was done in this one instance only if this action was taken from the magnanimous nature of the Government's hearts rather than the reality of the hard grind of politics that goes on behind the scenes in these Bills with all the bargaining to get a Bill of some sort at any cost whether it is to be passed in the referendum in Wales on a straight vote, a twisted vote, a rigged vote or any other sort of vote.
      Sir Raymond Gower: I am not the Government's apologist, but, to be fair to them, they said that they opposed the 40 per cent. requirement. Does this not bear out what the Minister has said? The Government had a better chance of defeating the 40 per cent. requirement than they might have had of defeating the lower minimum requirement. It was much easier for them to fight convincingly to defeat the 40 per cent. than to defeat the 33 per cent.
      Mr. Wigley: The hon. Gentleman has been here much longer than I have and he knows that the reality is that when the Government are determined to get something as important as this through—and it is in their manifesto and their legislative programme—they do not lose votes on a three-line Whip by a majority of 72. When I heard the extent of the majority, I found it inconceivable that the Government could have been serious about winning the vote. Indeed, we have heard from a number of hon. Members that there was no retribution and not one word of rebuke for voting against the Government. The whole thing is a mockery and charade and an indication of the seriousness of the Government in getting the Bill on to the statute book and implemented.
      The new clause has been put down in order to facilitate the rigged referendum with a 40 per cent. threshold. Its purposes could have been achieved by other means. If the Government had put amendments into other parts of the Bill, they would not have needed the provisions that they have now given and the marginal concession that they have given
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      to the Tories in relation to the House of Lords.
      Plaid Cymru has tabled amendments that would have allowed that to be achieved without the reintroduction of this clause, but the Government have reintroduced the clause in order, presumably, to have a rigged referendum. If they had accepted our amendment, they could have had a straight referendum, but they are determined to stick to the 40 per cent. threshold with all that that means.
      We are opposing the new clause on the basis of its implications for the referendum. We are not against a referendum. We were calling for a referendum before the Labour Party did so. My hon. Friend the Member for Carmarthen (Mr. Evans) supported a referendum in 1968. However, we are opposed to a referendum which has a built-in obstacle and unfairness that means that the whole concept of the referendum is discredited before it starts.
      At a cost of £500,000 in Wales and £800,000 in Scotland, it is a pretty futile exercise to go through all this when the result may not be credible.
      Mr. Fred Evans rose—
      Mr. Deputy Speaker: Order. Before the hon. Gentleman makes his intervention, perhaps I may inquire how the referendum gets involved with the new clause.
      Mr. Wigley: Indeed. I am pleased to explain that, Mr. Deputy Speaker. If the new clause is not passed, there will not be a referendum.
      Mr. Fred Evans: Will the hon. Member for Caernarvon (Mr. Wigley) cast his mind back and recall that the debate in 1968 to which he referred, in which the leader of his party, the hon. Member for Carmarthen (Mr. Evans), took part, was a private Member's motion on proportional representation? I was present at that debate, and at one point there was reference to a referendum on proportional representation. There have been references in the House to the acceptance of a referendum—provided that Plaid Cymru could pretty well write all the questions. Members of Plaid Cymru suggested a multitude of questions which they wanted to see in a referendum.

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      The hon. Member is engaging in a futile exercise. He is distorting history and filibustering. He is trying to prove that the pot is blacker than the kettle.
      Mr. Wigley: The hon. Member cannot have it that way. If his Government had been as magnanimous to him as they were to some of his hon. Friends in relation to the amendment which led us to our present position, he would have had the opportunity to discuss not only our amendments about the number of questions which should be asked but amendments tabled by Members from other parties about the future of the Welsh people and the alternatives that were open to be put in a referendum, if one were held.
      If the hon. Member casts his mind back to 1968, he will recall that there were two measures before the House. One of them was the Scotland and Wales (Referenda) Bill. That is the one to which my hon. Friend the Member for Carmarthen referred.
      We oppose this new clause because it provides a referendum of a nature that we do not like. We do not like it because it means, for instance, that the names of people on the electoral register who are dead will be taken into account in the calculation of the 40 per cent., unless specific provision to the contrary is made.
      Mr. Dalyell: Let us put the dead men in their graves. The basis of the calculation is what the Registrar General thinks would be an appropriate number, given the month of the year concerned.
      Mr. Wigley: The hon. Member is saying that ex cathedra, but, unfortunately, the Bill does not provide for that. We can go only by what is in the Bill. From questions which I asked in February and March, I discovered that the Government do not have the month by month figures for the number of dead in Wales in the current year. The latest figures which could affect the register are those for 1974. The only way in which the Government can act in this respect is by using the 1974 figures and assuming that in 1978 the same number of dead men will be on the register as were on it in 1974. The Government could make some sort of calculation on that basis. But there is no provision in the Bill for doing that. As the Bill stands, the figure involved is
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      that which appears to the Secretary of State to be 40 per cent. of the electorate.
      Perhaps the hon. Member for West Lothian is suggesting that the Secretary of State should use dark spectacles or put on blue or pink spectacles when looking at the figures, so that even if the figure is 40 per cent. it appears to be something different. That is the only way in which there could be a meaningful exclusion of the dead men's votes.
      When one talks about 40 per cent. of the register, one means the people who were registered in October. The register then comes into effect in February of the next year. Each month ###1 per cent. of the register becomes inaccurate. That means that by the end of the year in which that register is in force it is 17 per cent. inaccurate. That means that the total practical turnout is only 83 per cent., and we need 80 per cent. before we can have a straight referendum. If anyone believes that the people of Wales will be hoodwinked in that way into accepting a loaded and rigged referendum, he is wrong.
      Another problem arises from spoilt papers. Spoilt papers represent part of the total register. They are, therefore, part of the total figure from which the 40 per cent. is calculated. There is no mechanism for ensuring that the spoilt ballot papers are excluded, unless an amendment is moved in the House of Lords.
      Students cause another problem. They may be registered in two places. Students in my constituency may be registered in Caernarvon and Aberystwyth so that they can take part in elections either during term or during vacation. Students can vote only once. That means that the second vote cannot be used under any circumstances. If they are taken into account on the total register—
      Mr. Deputy Speaker: Order. The hon. Member is going far too wide of the new clause. Will he try and restrain himself and come back to the provisions of the clause?
      5.15 p.m.
      Mr. Wigley: With respect, Mr. Deputy Speaker, we oppose the new clause because it provides for what we believe to be an unfair referendum. I am giving the example of the student whose first

      275
      vote "Yes" will be cancelled by an assumed "No" vote in the second place of residence. That is a basic unfairness in the referendum. It is a reason why we shall oppose the new clause.
      Mr. Neil Kinnock: The hon. Member is making the stupid presumption that all students will vote "Yes". I believe that the majority will vote "No". It is also true that the address at which they are resident when the register is taken in October is the address which is valid. They cannot appear on more than one register.
      Mr. Deputy Speaker: Order. Perhaps the hon. Member can make that point tomorrow if he catches the eye of the Chair. This new clause deals with the mechanics of the referendum.
      Sir Raymond Gower: On a point of order, Mr. Deputy Speaker. It might be helpful to look at Clause 80, which is a more appropriate vehicle for discussion on the details of the referendum.
      Mr. Kinnock: On a point of order, Mr. Deputy Speaker. I shall abide happily by your strictures if all other hon. Members do so.
      Mr. Wigley: The hon. Member for Bedwellty is wrong in his information, but I shall not go into that.
      If we have a referendum—and the Government are providing a rigged referendum—we require answers at some stage to the issues that have been raised. It is a matter of opinion whether it is appropriate to debate them now or on some other occasion. These questions must be faced by the Government. If they do not do so, they will leave the people of Wales with the impression that the referendum is fixed and rigged and calculated to stop the Welsh people achieving the "Yes" vote which would be forthcoming in a straight referendum. For that reason, we cannot support the new clause and we shall oppose it in the Lobby.
      Mr. John Smith: I shall reply briefly to some of the questions raised. The right hon. Member for Cambridgeshire (Mr. Pym) referred to the fact that similar override provisions in respect of resolutions not approved by the House of Lords applied to Clauses 34 and 35. The hon. Member for Barry (Sir R. Gower),
      276
      in a beguiling manner, also asked me to concede the argument on Clauses 34 and 35.
      Different considerations arise out of those two clauses, but the other place reached a decision in line with the right hon. Member's thinking on the Scotland Bill. The matter as it relates to the Scotland Bill will come back to this House for further consideration in a Lords amendment. It is reasonable to suppose that the House of Lords will reach much the same conclusion on the Wales Bill. Therefore, the issue will come back for further consideration. It will be considered again before the Bill receives Royal Assent.
      We shall bear in mind hon. Members' views. There will be a further debate on this matter in another place. It might be wiser for that debate to take place before the Government say anything one way or the other.
      My hon. Friend the Member for West Lothian (Mr. Dalyell), with considerable ingenuity, managed to refer to the excellent results that the Labour Party achieved in the Scottish regional and island elections. I respect my hon. Friend's sincerity but his enthusiasm for opposing the Bill sometimes leads him into errors of logic. It is fanciful for him to conclude that because the Labour Party had sweeping victories and because devolution was at the centre of its policy, the people of Scotland showed that they did not want devolution.
      I should have thought that my hon. Friend would have had a better point if the Labour Party had sustained serious defeats. My hon. Friend would then have said that it was because of our policy of devolution, and that if we did not have it we would have won. However, I must not follow my hon. Friend into these highways and byways of election results. One thing about which we are both agreed is that they are first-class results for the Labour Party. Even my hon. Friend's constituency chairman, who is a very strong pro-devolutionist, as my hon. Friend well knows, can agree with him on that. We can all agree on that.
      My hon. Friend asked me what was the meaning of subsection (1) of the new clause. Subsection (1) is precisely the same as the subsection in the old clause.

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      Clause 82. It is the absolutely conventional provision for commencement orders. My hon. Friend will have seen it in many Bills for which there are commencement orders But it so happens that it is entirely conventional. It alows the Secretary of State to bring in the different sections on different days. However, my hon. Friend was hinting. I think, that it might be used in some way to stop the Act coming into operation at all.
      I think that it would be totally wrong for a Secretary of State to manipulate his discretion in that way after Parliament had passed an Act and, moreover, after it had been approved by a referendum.
      My hon. Friend takes up some curious positions on the subject of the referendum. Having argued for provisions for a referendum to be put in the Bill, and, indeed, being one of the original signatories to the request that that be done, and having succeeded in getting included a very severe requirement that 40 per cent. of those entitled to vote should vote "Yes", I understand my hon. Friend's position to be that if the Scottish people,
      as I believe they will, and the Welsh people, resoundingly decide in favour of devolution, my hon. Friend—so far as Scotland is concerned, at least; he has not said anything about Wales—will still vote against it. He will vote against it although it has been approved by Parliament and the people. Then he has the sauce to say that in addition to all that, the Secretary of State should try to manipulate this new clause in some way so that devolution does not come into operation.
      There will come the day when my hon. Friend will realise that he has lost the battle. It has not arrived yet. We shall need the assistance of the electorate to persuade him about that. But it is going far too far to say that we should somehow manipulate this conventional and standard clause in such a way as to meet my hon. Friend's prejudices, because by that time he will be about the only person who is opposed to devolution.
      Question put, That the clause be read a Second time:—
      The House divided: Ayes 235, Noes 17.

      Division No. 195]

      AYES

      [5.23 p.m.

      Allaun, Frank

      Davidson, Arthur

      Grieve, Percy

      Archer, Rt Han Peter

      Davies, Bryan (Enfield N)

      Grocott, Bruce

      Ashley, Jack

      Davies, Rt Hon Denzil

      Hamilton, James (Bothwell)

      Ashton, Joe

      Davies, Ifor (Gower)

      Hamilton, W. W. (Central Fife)

      Atkins, Ronald (Preston N)

      Davis, Clinton (Hackney C)

      Harper, Joseph

      Bagier, Gordon A. T.

      Deakins, Eric

      Harrison, Rt Hon Walter

      Barnett, Guy (Greenwich)

      Dean, Joseph (Leeds West)

      Hart, Rt Hon Judith

      Barnett, Rt Hon Joel (Heywood)

      Dell, Rt Hon Edmund

      Hattersley, Rt Hon Roy

      Benn, Rt Hon Anthony Wedgwood

      Dempsey, James

      Hayman, Mre Helene

      Bennett, Andrew (Stockport N)

      Doig, Peter

      Hooley, Frank

      Bidwell, Sydney

      Dormand, J. D.

      Horam, John

      Bishop, Rt Hon Edward

      Douglas-Mann, Bruce

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

      Blenkinsop, Arthur

      Duffy, A. E. P.

      Hoyle, Doug (Nelson)

      Boardman, H.

      Eadie, Alex

      Huckfield, Les

      Booth, Rt Hon Albert

      Edge, Geoff

      Hughes, Rt Hon C. (Anglesey)

      Boothroyd, Miss Betty

      Ellis, John (Brigg & Scun)

      Hughes, Robert (Aberdeen N)

      Bottomley, Rt Hon Arthur

      English, Michael

      Hughes, Roy (Newport)

      Boyden, James (Bish Auck)

      Evans, Fred (Caerphilly)

      Hunter, Adam

      Bradley, Tom

      Evans, Ioan (Aberdare)

      Irvine, Rt Hon Sir A. (Edge Hill)

      Brown, Robert C. (Newcastle W)

      Evans, John (Newton)

      Irving, Rt Hon S. (Dartford)

      Buchanan, Richard

      Ewing, Harry (Stirling)

      Jackson, Colin (Brighouse)

      Butler, Mrs Joyce (Wood Green)

      Faulds, Andrew

      Jackson, Miss Margaret (Lincoln)

      Callaghan, Rt Hon J. (Cardiff SE)

      Flannery, Martin

      Janner, Greville

      Callaghan, Jim (Middleton & P)

      Fletcher, Ted (Darlington)

      Jay, Rt Hon Douglas

      Campbell, Ian

      Foot, Rt Hon Michael

      Jeger, Mrs Lena

      Cant, R. B.

      Forrester, John

      Jenkins, Hugh (Putney)

      Cartwright, John

      Fowler, Gerald (The Wrekin)

      John, Brynmor

      Castle, Rt Hon Barbara

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

      Johnson, James (Hull West)

      Clemitson, Ivor

      Freeson, Rt Hon Reginald

      Johnson, Walter (Derby S)

      Cocks, Rt Hon Michael (Bristol S)

      Garrett, John (Norwich S)

      Jones, Alec (Rhondda)

      Cohen, Stanley

      Garrett, W. E. (Wallsend)

      Jones, Barry (East Flint)

      Coleman, Donald

      George, Bruce

      Judd, Frank

      Cook, Robin F. (Edin C)

      Gilbert, Rt Hon Dr John

      Kelley, Richard

      Corbett, Robin

      Ginsburg, David

      Kilroy-Silk, Robert

      Cowans, Harry

      Golding, John

      Kinnock, Neil

      Cox, Thomas (Tooting)

      Gould, Bryan

      Lamborn, Harry

      Cronin, John

      Gourlay, Harry

      Lamond, James

      Crowther, Stan (Rotherham)

      Gower, Sir Raymond (Barry)

      Latham, Arthur (Paddington)

      Cryer, Bob

      Grant, George (Morpeth)

      Lestor, Miss Joan (Eton & Slough)

      Cunningham, Dr J. (Whiteh)

      Grant, John (Islington C)

      Lewis, Ron (Carlisle)

      Litterick, Tom

      Parker, John

      Summerskill, Han Dr Shirley

      Luard, Evan

      Parry, Robert

      Swain, Thomas

      Lyon, Alexander (York)

      Pavitt, Laurie

      Taylor, Mrs Ann (Bolton W)

      Lyons, Edward (Bradford W)

      Pendry, Tom

      Thomas, Jeffrey (Abertillery)

      Mabon, Rt Hon Dr J. Dickson

      Perry, Ernest

      Thomas, Mike (Newcastle E)

      McCartney, Hugh

      Phipps, Dr Colin

      Thomas, Ron (Bristol NW)

      McDonald, Dr Oonagh

      Price, William (Rugby)

      Tacrne, Stan (Preston S)

      MacFarquhar, Roderick

      Radice, Giles

      Tierney, Sydney

      MacKenzie, Rt Hon Gregor

      Rees, Rt Hon Merlyn (Leeds S)

      Tilley, John (Lambeth, Central)

      Mackintosh, John P.

      Richardson, Miss Jo

      Tinn, James

      Maclennan, Robert

      Roberts, Albert (Normanton)

      Tomlinson, John

      McNamara, Kevin

      Roberts, Gwilym (Cannock)

      Tomney, Frank

      Madden, Max

      Robinson, Geoffrey

      Tuck, Raphael

      Magee, Bryan

      Roderick, Caerwyn

      Urwin, T. W.

      Mallalieu, J. P. W.

      Rodgers, George (Chorley)

      Varley, Rt Hon Eric G.

      Marks, Kenneth

      Rodgers, Rt Hon William (Stockton)

      Wainwright, Edwin (Dearne V)

      Marshall, Dr Edmund (Goole)

      Rooker, J. W.

      Walker, Terry (Kingswood)

      Marshall, Jim (Leicester S)

      Roper, John

      Watkins, David

      Mason, Rt Hon Roy

      Rose, Paul B.

      Watkinson, John

      Maynard, Miss Joan

      Rowlands, Ted

      Weitzman, David

      Meacher, Michael

      Ryman, John

      Wellbeloved, James

      Mellish, Rt Hon Robert

      Sandelson, Neville

      White, Frank R. (Bury)

      Mikardo, Ian

      Sedgemore, Brian

      White, James (Pollok)

      Miller, Dr M. S. (E Kilbride)

      Sever, John

      Whitlock, William

      Mitchell, Austin

      Shaw, Arnold (Ilford South)

      Willey, Rt Hon Frederick

      Molloy, William

      Sheldon, Rt Hon Robert

      Williams, Rt Hon Alan (Swansea W)

      Morris, Alfred (Wythenshawe)

      Shore, Rt Hon Peter

      Williams, Alan Lee (Hornch'ch)

      Morris, Rt Hon Charles R.

      Short, Mrs Renée (Wolv NE)

      Williams, Rt Hon Shirley (Hertford)

      Morris, Rt Hon J. (Aberavon)

      Silkin, Rt Hon John (Deptford)

      Wilson, Rt Hon Sir Harold (Huyton)

      Moyle, Roland

      Silkin, Rt Hon S. C. (Dulwich)

      Wilson, William (Coventry SE)

      Mulley, Rt Hon Frederick

      Silverman, Julius

      Wise, Mrs Audrey

      Murray, Rt Hon Ronald King

      Skinner, Dennis

      Woodall, Alec

      Newens, Stanley

      Smith, John (N Lanarkshire)

      Woof, Robert

      Noble, Mike

      Snape, Peter

      Wrigglesworth, Ian

      Oakes, Gordon

      Spearing, Nigel

      Young, David (Bolton E)

      Orme, Rt Hon Stanley

      Spriggs, Leslie

      Owen, Rt Hon Dr David

      Stallard, A. W.

      TELLERS FOR THE AYES:

      Padley, Walter

      Stewart, Rt Hon M. (Fulham)

      Mr. Ted Graham and

      Palmer, Arthur

      Stoddart, David

      Mr. Alf Bates.

      Park, George

      Strang, Gavin

      NOES

      Bain, Mrs Margaret

      Hooson, Emlyn

      Thorpe, Rt Hon Jeremy (N Devon)

      Beith, A. J.

      Howells, Geraint (Cardigan)

      Watt, Hamish

      Crawford, Douglas

      MacCormick, Iain

      Welsh, Andrew

      Evans, Gwynfor (Carmarthen)

      Pardoe, John

      Ewing, Mrs Winifred (Moray)

      Penhaligon, David

      TELLERS FOR THE NOES:

      Freud, Clement

      Thomas, Dafydd (Merioneth)

      Mr. Dafydd Wigley and

      Grimond, Rt Hon J.

      Thompson, Georga

      Mr. Gordon Wilson.

      Question accordingly agreed to.
      Clause read a Second time, and added to the Bill.

    New Clause No. 4

      EMPLOYMENT OPPORTUNITIES OF WELSH SPEAKERS
      'In exercising its powers under section 10 above the Assembly shall not do anything which would unreasonably prejudice the interests or restrict the employment opportunities of those who do, or those who do not, speak the Welsh language.—[Mr. Wyn Roberts.]
      Brought up, and read the First time.
      5.30 p.m.
      Mr. Wyn Roberts: I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker: With this we may discuss the following amendments:
      280
      No. 8, in page 6, line 22, leave out Clause 10.
      No. 9, in Clause 10, page 6, line 22, leave out from 'may' to end of line 24 and insert
      'make arrangements to support museums, art galleries, libraries, the languages and culture of Wales, the arts, crafts, sport and other cultural and recreational activities; but shall not under this section do, or include in any such arrangements anything which would unreasonably prejudice the interests or restrict the employment opportunities of those who do, or those who do not, speak the Welsh language'.
      No. 10, in page 6, line 24, at end insert
      'provide that such activities do not discriminate against the use or position of the English language in Wales'.
      Mr. Roberts: The new clause is inseparable from Clause 10, which provides that
      "The Assembly may do anything it considers appropriate to support museums, art galleries, libraries, the Welsh language, the

      281
      arts, crafts, sport and other cultural and recreative activities."
      Those of us who have served on Standing Committees will be familiar with those words. The phrase "may do anything" will be as shockingly familiar as the first heavy raindrops from an impending cloudburst. The deluge of questions that follow will also have a familiar ring.
      Equally familiar will be the gentle, priestlike incantations of the Minister. He will protest his innocence and that of the Government. He will say that the clause has many respectable antecedents, which take us back through the mists of recent history to the Local Government Act 1972, and beyond.
      I remember discussing a clause on the same lines on the Community Land Bill, in Committee, in the early hours of 17th June 1975. The Opposition were then assisted by Government-provided notes on clauses, and I quoted the notes on this power to do anything. They referred to it disarmingly as
      "a power commonly conferred on statutory authorities who may carry out only functions which they are specifically authorised to carry out."
      The statutory authority under discussion then was the Land Authority for Wales.
      The notes on clauses went on to say:
      "Since it is not possible to foresee from the outset exactly what may be required in all circumstances if the Authority are to be able to function efficiently, a power is taken to cover any minor activities which it might otherwise be doubtful whether the Authority had power to carry out."
      The minor activities were not spelled out in that Bill, but we have the Government's assurance that they were minor and that the begetter of the original clause was none other than my right hon. Friend the Member for Crosby (Mr. Page), who had installed it in the Local Government Act 1972.
      Section 111 of that Act shows how carefully my right hon. Friend hedged about the power to do anything. In the first place, in that Act it is a subsidiary power, whereas in this Bill the power to do anything has graduated into a principal function. That is a significant elevation for a common little power to perform minor activities.
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      Furthermore, instead of the hedging that appeared in the 1962 Act, which confined the power and made it
      "subject to the provisions of this Act and any other enactment passed before or after this Act",
      the sphere in which the power may be exercised has now been opened up. The question of what is appropriate is left to the discretion of the Assembly. In other words, Clause 10 opens the door for the Assembly to do anything. It can act intra or ultra vires, within or beyond the powers specified in the remainder of the Bill. There is no limitation on this power to do anything. The Assembly may do anything that "it considers appropriate". I purposely emphasise that latter phrase relating to consideration.
      When we were discussing the Local Government Bill in Standing Committee, my right hon. Friend the Member for Crosby rejected an amendment which would have allowed local authorities to do anything which "in their opinion" was likely to facilitate the discharge of their function, on the ground that it opened the door wide to a breach of the vires rule.
      That door has been thrown wide open in Clause 10. Coupled with the fact that the power to do anything is a principal function, we have here a new departure in legislation—a departure that may have serious consequences. What began a few years ago as a fledgling clause, designed to cover minor unforeseen eventualities, has developed into a major power, not limited, as in the Local Government Act, the Community Land Act and the Welsh Development Agency Act, to activities ancillary to the main functions of the bodies concerned.
      The power in Clause 10 is one that has increased, is increasing and ought to be diminished. On those grounds alone there is much to be said for the proposal of my hon. Friend the Member for Aylesbury (Mr. Raison) in Amendment No. 8, that the clause should be dropped.
      That, in brief, is the constitutional background to our new clause, which seeks to inhibit the Assembly in at least one sensitive area, that of interest and employment opportunities, and to ensure that there is no discrimination on linguistic grounds. We touched on this matter

      283
      previously, when we discussed Clause 25, now Clause 24, and the appointment of staff to the Assembly. What I said then is equally valid now, and I shall not repeat it.
      Whether we like it or not, there is concern about the danger of discrimination on linguistic grounds. There are those who fear that the Assembly will become an instrument of political and cultural nationalism of an extreme character. What we on the Conservative Benches seek to ensure is fairness in all matters and equal opportunities for all.
      Our Amendment No. 9 makes this abundantly clear. It would give power to the Assembly to make arrangements to support, among other things, "the languages"—plural—"and culture of Wales". But the amendment also states that the Assembly
      "shall not under this section do, or include in any such arrangements anything which would unreasonably prejudice the inteests or restrict the employment opportunities of those who do, or those who do not, speak the Welsh language".
      The question arises whether the Assembly is likely or unlikely to do anything that is unfair to Welsh speakers or non-Welsh speakers. If the Members of the Assembly represented the numerical division of the Welsh population, about 20 per cent. of Assemblymen would be Welsh speaking and 80 per cent. would not. But they will be elected not on a linguistic basis but on a constituency basis. Even if knowledge of the Welsh language is a winning asset to a candidate in the predominantly Welsh-speaking rural areas, such candidates are very likely to be heavily outnumbered in the Assembly by non-Welsh speaking representatives of the heavily populated industrial areas of Wales. Therefore, on the face of it, the greater potential threat is to the Welsh-speaking minority.
      It was said more than once in Committee that the majority of Assemblymen may have far less sympathy with the Welsh language and its related culture and institutions than has been shown by the Westminster Parliament and central Government. There is perhaps an element of truth in that.
      5.45 p.m.
      Everything depends on the preservation of a sane and balanced approach to our cultural problems in Wales. The sanity
      284
      and balance must be shown on both sides of the linguistic divide. We know from experience that the extremist approach only causes antagonism and a gnawing fear of the future, and makes us appear as a house divided against itself. The majority of Welsh people do not want a divided society. They have the example of Northern Ireland vividly before them.
      Only 1·2 per cent. of our entire population of 2·7 million claimed in the 1971 census to be Welsh speaking only. The rest of us are either bilingual or speak only English in our daily lives. The ideal for the vast majority of us is not so much a peaceful as a stimulating co-existence which enriches us all.
      For example, the English literature of Wales owes a great deal to the influence of the Welsh language, and Welsh literature is often influenced by English style and thought. The inter-dependence of Welsh speakers and non-Welsh speakers in Wales is extensive. We not only accept it but enjoy it.
      Mr. Dalyell: The hon. Gentleman said that 1·2 per cent. of the population claimed to be simply Welsh speaking. I spent a very happy holiday in Dolgellau, in the heart of Welsh speaking Wales, and we were told then that there was virtually no one who could not understand the English language, if he or she wanted to. What is the truth of the matter?
      Mr. Roberts: We are talking not about understanding but about speaking the English language. However, I think that in order to discover that 1·2 per cent. one would have to look extremely hard.
      There is a biased feel about Clause 10
      Sir Raymond Gower: I have been following my hon. Friend's speech with much interest. Presumably, one of the things that the Assembly might do to which some people would object would be to devote a disproportionate amount of its resources to the Welsh language. Would not that place the Assembly in some difficulty when it came to this House? It has no means of raising money on its own. It must come to this House for funds, annually. Would my hon. Friend regard as a sufficient safety measure the fact that there is no means of raising money separately?
      Mr. Roberts: The point that I have been making is that it is entirely up to

      285
      the Assembly to decide what is proportionate and what is disproportionate. My hon. Friend asks me whether it is a sufficient guarantee that the Assembly must come to this House for the block grant. I do not think that it is—nor are the other measures to which the Assembly would be subject. The whole point is that the Assembly is very much a law unto itself, particularly under Clause 10.
      I was saying, Mr. Deputy Speaker, that there is a biased feel about Clause 10 as it stands. It is easy to understand how that has come about if we look at the clause in the light of the fact that in recent times the most persistent demands for financial support by Government have come from institutions and organisations associated with the Welsh language, which has, sadly, been in decline, and for that reason has caused deep anxiety, which expresses itself in various ways.
      This, in turn, has induced a feeling of neglect among the non-Welsh speakers and arguments as to the proper balance in effort and resources which should be maintained—the sort of problem to which my hon. Friend the Member for Barry (Sir R. Gower) has just referred. These arguments range from broadcasting to education, and are to be heard at local and national level. They are a fact of life in Wales.
      As legislators, our duty is clear. It is to provide a basic framework which is essentially fair. I believe that our new clause and Amendment No. 9 do that admirably, and better than Clause 10 as it now stands. If I had to choose between the two improvements that we suggest, I would express a sneaking preference for Amendment No. 9, because it is slightly broader in scope than is the new clause, and it leaves out the odious phrase "do anything", which has a curious air of irresponsibility about it.
      What I think has happened is that the Government sought to combine in one clause the usual ancillary power to cover unforeseen minor activities necessary for the Assembly to perform its major functions with a main power to support the string of subjects mentioned in the clause. To my mind, the combination makes nonsense of the whole clause. If the Assembly may do anything, it could, let us say, in support of the crafts of Wales, force every household to buy a coracle, or to support
      286
      the Welsh language by banning the use of English on Sundays. The mind boggles at the faintly humorous possibilities.
      But what sort of thing will the Assembly do? I think that the Government are in honour bound to tell us what kind of activity the clause is intended to cover. Of course, the Government will say that we must trust the Assembly; that the Assembly can do only what it thinks appropriate, and is hardly likely to do anything foolish. That was the line taken by the Secretary of State on one of his rare visits to the House in connection with the Bill. He said:
      "There is no reason to imagine that it would act in any way which would antagonise the English-speaking majority in the Principality. There can be no doubt in the mind of anyone who is prepared to trust the Welsh people but that the Assembly will be fair both to Welsh and non-Welsh people alike."—[Official Report, 8th March 1978; Vol. 945, c. 1488.]
      Very well. Let us hope that the Government are right and that the Assembly will behave responsibly. But let us, in this clause, give the Assembly a better indication than there is in the clause now of what we consider to be just, fair and appropriate for it to do—and perhaps our feeling about fairness in these matters will permeate down to local authority level as well. Otherwise, if and when we come to the referendum, those electors who have bothered to read the Bill will rightly be fearful of the power that we are to give the Assembly under this open-ended clause, which, as I said earlier, not only contains no inhibition and no limitation whatsoever on the power of the Assembly but gives the Assembly discretion in the way it is to be used. It is a power without precedent, and it is we who will be blamed if it is misused.
      I urge my right hon. and hon. Friends to support the new clause.
      Mr. Cledwyn Hughes: I had not intended to speak on the new clause, Mr. Deputy Speaker. Having read it and having listened to the hon. Member for Conway (Mr. Roberts), however, I am not greatly moved to support it. It certainly does not impress me as being necessary.
      My first comment to the hon. Gentleman—who obviously has given a great deal of thought to the subject—is that the Welsh Language Act 1967 covers all the necessary points which he made and safeguards the Welsh language. The new

      287
      clause, therefore, in my view, is unnecessary.
      The hon. Gentleman and the House will recall that the 1967 Act gives the Welsh language equal validity with the English language in public processes in Wales. The Act is generally accepted by the great majority of the people of Wales, whether they speak Welsh or not. As I had responsibility for drafting the Bill and for piloting it through the House at the time, I have followed its operation with considerable care since then in all the various fields of public activity in Wales. I am bound to say that I have received no criticism of it at all. The general view from Anglesey to Gwent is that the Act—which emerged from the recommendations of the Hughes-Parry Report—was desirable and has been entirely effective. Therefore, to seek to insert the clause in the Bill at this stage is, in my view, to create a needless complication.
      It is worth bearing in mind that before the 1967 Act the Welsh language had no status whatsoever in Wales. It had been neglected for centuries. In my view—and in the view, I think, of every Member of the House with any feeling for liberty—it was without doubt a disgraceful thing that the oldest spoken language in these islands had been deprived of status and no equal validity with the language which is, we recognise, is spoken by the majority. It was a dishonourable state of affairs, and the 1967 Act is one of the things for which I have been responsible in this House of which I am most proud. A great wrong was righted.
      As for those who cannot speak the Welsh language—we appreciate that they are represented by the great majority of the people in the Civil Service in Wales, who likewise do not speak Welsh. That is not a point of criticism or a comment; it is a statement of fact. As for Members of Parliament from the Principality, the majority of them do not speak the Welsh language. They represent, in other words, the people who elect them, and that is how the system works.
      6.0 p.m.
      I should like to ask the hon. Member for Conway a serious question. What is the real objective of the new clause? Is it further to safeguard the Welsh language? Is it to ensure that Welsh
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      speakers are not ill-treated or victimised in some way? Is that the object of the new clause? As I understand it, that is what the new clause says. It says that
      "In exercising its powers under section 10 above the Assembly shall not do anything which would unreasonably prejudice the interests or restrict the employment opportunities of those who do, or those who do not, speak the Welsh language."
      It is quite clear in saying that, somehow or other, Welsh speakers are to be protected from ill-treatment, victimisation or exclusion from appointment to some employment in the public service. But, of course, the hon. Member for Conway and the other signatories to the motion know perfectly well that those who speak Welsh also speak English. So far as I can predict, no monoglot Welsh-speaking people will apply for these posts.
      If that is the purpose of the new clause, we should be told by Conservative Members that this is what they are seeking to achieve. With that I would have a certain sympathy if it was realistic. But the fact is that our Welsh-speaking compatriots, who will be in competition for any of these appointments, are people who will be fluent in both languages.
      Why, therefore, is the new clause necessary? I have a slightly uneasy feeling—I am open to persuasion—that the whole thing is a bit of a humbug and that it is something of an insult to the Welsh language. The endless innuendo—
      Mr. Nicholas Edwards: The right hon. Member for Anglesey (Mr. Hughes) is bringing down the level of the debate.
      Mr. Hughes: When one begins to criticise a new clause moved by the Opposition, one is always accused by hon. Members of bringing down the level of debate. It is not a question of the level of debate, it is one of analysing the new clause honestly and looking at it from every conceivable point of view.
      This endless innuendo that, somehow, English speakers will be ill treated in Wales is, in my view, offensive. They are not badly treated. If they were, I would certainly take all possible steps, as would all my hon. Friends who speak the Welsh language, to ensure that that did not take place. Indeed, it never has taken place. Any student of Welsh history

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      knows that that is just not true. English speakers in Wales have had every opportunity, at every level and at all times during the last 500 years to find jobs. I do not know what the hon. and learned Member for Cleveland and Whitby (Mr. Brittan) is muttering about. That may not be within the right hon. and learned Gentleman's knowledge, but it is certainly within mine.
      Mr. Leon Brittan: Since the right hon. Gentleman has referred to me specifically, I was merely indicating that as far as I was aware there is absolutely nothing in New Clause No. 4 which indicates or suggests that in the past any people have suffered discrimination of the kind to which the right hon. Gentleman has referred. Therefore, there need not be such a flurry of Order Papers when I say that.
      Since I am on my feet, I wonder whether the right hon. Gentleman will answer a question? It is a genuine question, and I hope that he will take it as such. When referring to the 1967 Act he seemed to imply that that rendered this new clause unnecessary. He indicated that that Act, for the first time, achieved what we would all agree was the laudable object of giving validity, for certain purposes, to the Welsh language. Is he saying that there is anything in that Act which prevents discrimination against people who speak Welsh, or discrimination against people who speak English? As I understand it, there is not. If there is, I would genuinely be assisted if the right hon. Gentleman, as author of that Act, could identify the section that has that effect.
      Mr. Hughes: What the Act does is to ensure that there is no discrimination against the Welsh language. As the right hon. and learned Gentleman well knows, that is what had occurred for several centuries. It is that point of view that he must try to understand. What I am saying is that in the light of that Act, and in the light of all the circumstances which we know to obtain in Wales at present in the public service, this clause is not necessary. It tends to confuse the issue and to create a situation that is not helpful to either the Welsh speaker or the English speaker.
      Mr. Brittan: I am sorry to interrupt again. This is a genuine question, and
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      I am sure that the right hon. Gentleman would like to assist the House by answering it, if he is able to. As I understand it, the Act makes lawful what was previously not lawful, namely, the use of the Welsh language for certain purposes. To that extent it removes discrimination against the Welsh language.
      But does the Act, in the right hon. Gentleman's view, prevent discrimination against people who speak the Welsh language or speak the English language? If so, where in the Act is it to be found? That is quite a different matter from permitting or banning the use of the language. If the answer is that there is nothing in the Act which does that, this provision is not rendered unnecessary by the Act, although it may be desirable or undesirable on other grounds.
      Mr. Hughes: The short answer to the hon. and learned Gentleman is that at present the law itself protects the English speaker. English is the official language of all the United Kingdom. There is no policy of bilingualism. English is always the first language, not only in England but in Wales. English has priority. All official documents are published in English. Some are translated into Welsh. For example, as the hon. and learned Gentleman well knows, that is true of legal documentation. There is no likelihood of discrimination against English, because English is dominant under the law as it is. There is no reason to repeat the obvious in this new clause.
      Mr. Brittan: With great respect, that does not deal with my point. I promise the right hon. Gentleman that I am genuinely not trying to be awkward or difficult for its own sake. But it seems that there is a real question which has to be disposed of if the argument that the 1967 Act renders the new clause unnecessary is to be considered seriously. As I understand it, that Act merely says that Welsh may be used as well as English for certain purposes. That is quite a different matter from saying that people cannot be discriminated against because they speak Welsh or because they speak English.
      It is perfectly possible that someone would be permitted to use the Welsh language if he is engaged in a certain function. None the less, a public body could exercise discrimination to prevent him

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      from enjoying the opportunity of exercising that function by gaining a particular type of employment. As far as I am aware, the Act that the right hon. Gentleman introduced does not prevent that. The new clause may not be necessary or desirable, but it is not rendered unnecessary by the Act, because the Act does not cover the same ground as does the new clause.
      Mr. Hughes: I regret that I have not made myself clear. What I was seeking to explain was that for the first time for several centuries the 1967 Act made it possible for discrimination against the Welsh language to be avoided. With regard to the English language, there never has been any discrimination, and could be no discrimination at present. I hold this to be self-evident.
      I return to my question. Do the signatories to the new clause believe that because a man speaks Welsh in his own country he might be denied the opportunity of a job? The answer to that is "No." Do they, then, think that because a man speaks no Welsh he will be denied a job in his own country, for example, by the Assembly? I think the answer to that is obviously "No." The great majority of any Assembly which may be elected as a result of this Bill will consist of people who represent non-Welsh speaking areas. They will reflect the same kind of linguistic ratio as exists in the House of Commons at present.
      Does anyone in the House believe that a Welsh Assembly will have a majority of Welsh-speaking people who will seek to impose the Welsh language on the population of Wales against its wishes? That seems to be the proposition. If that were to be the case, if anyone in the House believed that it would be so, there might be a case for supporting the new clause.
      Mr. Peter Rees: May I, as a Welshman who does not speak Welsh, give the right hon. Gentleman a precedent that he may care to consider? I understand it to be the case, although I have not checked, because I did not anticipate the course of the right hon. Gentleman's argument, that in the Republic of Ireland there are certain posts where it is obligatory to speak Erse, or the Irish language. It is not without the bounds of possibility, because we can
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      never entirely forecast what future generations may do in an excess of enthusiasm, that that kind of restriction will be imposed on some positions in Wales. One cannot foretell. But if it is a possibility, surely this new clause cannot be undesirable.
      Mr. Hughes: I do not want to be tempted to cross the Irish Sea to Ireland and discuss the experience there, but if the hon. and learned Gentleman knows Irish, or Erse, as I know it, he will agree that it has been a dismal experience. We have to do a little better than that. The hon. and learned Gentleman has advanced an argument against the new clause. There may be rules and regulations in the Republic about language, but as far as as I know very few people observe them. We want to ensure that people speak Welsh naturally and are encouraged to do so with the minimum of rules and regulations. Therefore, I think the new clause unnecessary and I invite the House to oppose it.
      Mr. Timothy Raison: I want to speak about my Amendments Nos. 8 and 10, particularly No. 8, which proposes that we should leave out Clause 10, which provides that
      "The Assembly may do anything it considers appropriate to support museums, art galleries, libraries, the Welsh language, the arts, crafts, sport and other cultural and recreative activities."
      As my hon. Friend the Member for Conway (Mr. Roberts) said, that seems to convey or provide an enormously wide range of powers. This debate is important at least because it gives us a chance to find out exactly what those powers are. As the House will recall, it was one of the many important clauses that were not debated in Committee because of the operation of the guillotine, and it is therefore vital that we should have a clear statement of what the whole thing adds up to.
      As I understand it, the Government's view is that the powers embodied in Clause 10 are the normal executive non-statutory powers of Ministers. In other words, it does not provide any power to legislate. Indeed, the Assembly is not a legislative body. The Attorney-General, in a debate on 18th April, described the powers in these words:
      "Those are the sorts of powers which are exercised by Ministers of the Crown even if they step outside what is perhaps properly or constitutionally the subject of ministerial

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      powers as such."—[Official Report, 18th April 1978; Vol. 948.]
      That seems a slightly odd description. I was surprised that the Attorney-General should talk in terms of accepting things outside the proper or constitutional powers. Nevertheless, I think that I see what he meant.
      These powers are really executive powers which have grown up out of time to Ministers of the Crown. One of the interesting and important aspects of Clause 10 is that it marks an exception: that the rest of the executive powers which belong to Ministers are not transferred to the Welsh Assembly. The Government make it clear, by Clauses 10 and 11, that the normal executive non-statutory powers of Ministers of the Crown will not be exercised by the Assembly and that they can be exercised by the Assembly only when conveyed to the Assembly by specific provision in the Bill. That is what Clauses 10 and 11 do. So it is worth noting that there is a real limitation on the powers of the Assembly in the normal powers that are not conferred by statute, and that these are the exceptions.
      I was also to a certain extent reassured by the Attorney-General in a letter that he has written to me. He says:
      "The powers conferred by the clause do not include any power to impose legal duties or liability on the subject, or to confer legally enforceable rights or immunities on the subject. For those purposes, further legislative provision would be needed."
      So, if the right hon. and learned Gentleman is right—and I am not disputing what he says—the sweeping powers in Clause 10 are not perhaps quite as sweeping as they appear at first blush.
      6.15 p.m.
      That is an improvement. I was glad to discover that point from the Attorney-General. But it remains true that there appear to be very wide executive powers, and those powers do not necessarily involve the spending of resources. One hon. Member has implied that the need to raise resources would serve as a limitation on the Assembly. But, even if the Assembly is limited in its resources—it has only the block grant—there are some important actions that it could take which do not require the expenditure of a considerable sum of money. Therefore, it appears that, in the task of promoting the Welsh language, for example, and in the
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      other topics mentioned in Clause 10, the Assembly can operate very wide executive powers.
      The right hon. Member for Anglesey (Mr. Hughes) said that it would be unthinkable for the Welsh Assembly to do certain things. He may well be right, but we do not know. We cannot tell until the Assembly is in being. But I reiterate that, when one is debating legislation of this kind, one has a duty to prepare for things going wrong. It is no good providing constitutions which depend solely on good will and common sense being exercised on all sides. The world is not necessarily going to work like that.
      It is reasonable, therefore, to put forward the view that one ought to be cautious and, if one likes, to lean over backwards to make sure that there are adequate safeguards. It seems to me that it is probably within the executive powers of the Welsh Assembly, without breach of any statute, to require, for example, that the correspondence of a certain Assembly Department should be carried out exclusively in Welsh. I may be wrong—there may be some statute which would prohibit the Assembly from doing that—but on the face of it it seems to me that such power exists.
      It is certainly evident that the Assembly, in so far as it can control these matters, might decide to support only Welsh language education courses rather than English language education courses. If these were matters for local government, it could not do so because it has no powers over local government, but in so far as these are matters for Assembly government I think that these powers would lie with the Assembly.
      As far as I can judge also, the Assembly could require the operation of the National Health Service in Wales to be conducted in the Welsh language because the NHS comes under the Secretary of State. It is not under local government. Therefore, that power theoretically exists. Hon. Members may laugh at the suggestion, and I accept that it is unlikely that the Assembly would do that, but the fact remains that, if I read the situation correctly, that is the sort of power that could exist.
      Clause 10 appears to make it possible for the Assembly to decide to push the Welsh language in that kind of way as

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      long as the matter is within the executive purview of the Assembly. I believe that these are very important considerations. I put forward my two amendments initially to try to get clearly on record what the position is—that is very important—but if we get an unsatisfactory reply from the Minister I shall have no hesitation in dividing the House.
      Sir Anthony Meyer: I suppose that all of us, when we envisage what the Assembly will be like, tend rather to exaggerate in our imaginations. My hon. Friends tend to think that it will be dominated by the Labour Party, while Labour Members in their nightmares imagine that it will be dominated by Plaid Cymru. People in my part of the country assume automatically that it will be dominated by representation of the Valleys and of the South.
      If, however, we reflect for a while, I think we realise that the Assembly will be composed almost certainly of reasonable men trying to do a reasonable job. However much I hope that the thing never comes into existence, the probability is that when it comes to elections it will be composed of reasonable men.
      However, there is another possibility that I wish to outline which will not stretch the imagination too far. Suppose that, impossibly, the Bill receives Royal Assent and there is a referendum this year. Suppose even more impossibly, that the referendum comes up with a "Yes" answer. Suppose that the next thing that happens is that there is a General Election, and the Government fall. Suppose that the new Conservative Government, as is only reasonable to expect, runs into very severe difficulties. Almost certainly, the first few months of the next Conservative Government will be very difficult. There will be a period in which that Government will undoubtedly be very unpopular. All incoming Governments tend to lose popularity very quickly and to lose by-elections. If the kind of threats that sometimes come from the Left wing of the Labour Partymaterialise, the Conservative Government will have to take very tough measures and they may find themselves very much reviled. Suppose that at that moment, elections were held to the Welsh Assembly.
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      The people of Wales would be very unhappy about the firm line being taken by the Conservative Government, but they would also be very mindful of that the total and utter failure of the Labour Party to do anything at all to resolve the problems of Wales. The Welsh people would remember the level of unemployment, the stagnation in production and all the unfulfilled promises.
      Mr. Cledwyn Hughes: Will the hon. Member tell the House which firm line will be pursued by the Conservative Government that would prove unpopular with the people of Wales?
      Sir A. Meyer: Let us suppose that there is a politically motivated strike in one of the public services and the Conservative Government feel obliged to stand up to that strike and refuse to give in to unreasonable demands. There could be a massive revulsion of feeling on that issue. It is not unthinkable. However, I do not think that it will happen for one moment. I am sure that the trade union leaders will be very sensible and responsible in their dealings with a Conservative Government. But such a situation could occur. In these circumstances, with the Conservative Government very unpopular, and everybody remembering the total failure of the Labour Government, it is not inconceivable that the elections to the Welsh Assembly would produce a massive majority for Plaid Cymru. If the election was held at the right psychological moment, this could be the outcome.
      Mr. Alec Jones: Does the hon. Member recall his early remarks today when he said that it was possible to exaggerate the situation? Is that not what he is doing now?
      Sir A. Meyer: I do not think that this will happen for one moment. I am simply saying that it is possible.
      I said earlier that I was sure the Assembly would consist of reasonable men, and I am sure that if there is a majority of Plaid Cymru members they will all be like the hon. Member for Carnarvon (Mr. Wigley)—eminently reasonable men. However, even if they are reasonable, they are dedicated to the prevalence of one particular philosophy. By definition, they will place very great

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      emphasis on the promotion of the status of the Welsh language.
      The champions of the language, more than anyone else, need the force of law in order to attain their ends. This is a demonstration of the absurdity of the tactics of some elements in the Welsh Language Society who deliberately set out to break the law and bring it into contempt as a means of advancing their cause. There is nothing they could do that is more sure to frustrate their own ends. It is only by the operation of the law that the language will spread.
      I see very real advantage in trying to define as tightly as possible, and very much more tightly than is done in this very wide clause as it stands, the functions of the Assembly in this matter of the promotion of the language.
      It is to be expected that when the Assembly meets, these reasonable men, whether they belong to Plaid Cymru or any other party, will be bitterly disappointed by the powers which they find they are able to exercise effectively. It does not take any great gift of prophecy to say that one of the most contentious and time-consuming issues will be the language itself. This is one of those subjects about which people can talk at enormous length without any great need for facts. One can feel a great deal better having had a thoroughly good argument about it. I am quite sure that it will be a major issue in the debates of the Assembly.
      For that reason, I see great advantage in trying to define as tightly as possible what the Assembly may or may not do in order to discourage the kind of fruitless, demagogic oratory which will undoubtedly ensue if the Assembly has the feeling that it need only push a little further to get additional powers in order to do more for the Welsh language.
      Mr. Cledwyn Hughes: Is the hon. Member suggesting that we will have fruitless, demagogic oratory in the Assembly in Wales?
      Sir A. Meyer: My experience of the Welsh Grand Committee has convinced me that such activity is totally unknown in any present elected forum of Welsh Members. However, the unthinkable could happen.
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      It would be harmful if the Assembly sought to extend its powers in the matter of the promotion of the language. I understand the point of view of those who seek by every means to extend its use and its influence. But there is a very delicate balance.
      In the county part of which I have the honour to represent, the education authority has a policy that every child in school must learn the Welsh language. While that is its policy, it is nevertheless always prepared to be reasonable if there are parents who, for any good or valid reason, do not wish their child to learn Welsh. This is managed with great skill and subtlety and with a general consensus of opinion all round. The number of complaints that I have had, other than from fanatics on both sides, has been minimal. I woud be very reluctant to upset the kind of modus vivendi which exists in local authorities in many parts of Wales by the incursion into this very delicate area of an Assembly which is burning to find something to do and, which is perhaps, consumed with a desire to perform well in front of the television cameras.
      I would very much prefer that the role of the Assembly in these matters should be as closely defined as it is in the amendment of my hon. Friend the Member for Aylesbury (Mr. Raison). That is why, if there is a vote on that amendment, I shall support it.
      Mr. David Price: The right hon. Member for Anglesey (Mr. Hughes) made two points with which I do not entirely agree. He referred to the new clause and my hon. Friend's amendment as if they applied only to the public sector and the public service. If he re-reads the wording of Clause 10 as it stands, I do not think he will find that it was amenable to that interpretation. It goes a good deal wider.
      The right hon. Member pointed out that the Welsh language is the oldest language spoken in the United Kingdom. But all the languages spoken in this country are, in historical terms, relatively young. Welsh itself dates only from shortly before the Roman invasion, so the historians tell us. It was a Celtic language; in fact, it was a brythonic branch of the Celtic language. Many things in the Welsh culture and in the

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      Welsh heritage are older than the language. Indeed, the great Welsh mountains can be dated in millions of years. Therefore, we are talking of languages that are young. Languages are still growing and developing. I think that we have a common bond in this aspect of our debate.
      6.30 p.m.
      If we think of the more primitive languages, it will be within the knowledge of some hon. Members that it is said by Persian scholars that the three basic languages are Arabic, Persian and Turkish. It is said that Arabic is the most persuasive and the language spoken by the serpent to seduce Eve, that Persian is the most poetic and the language in which Adam and Eve talked to each other, and that Turkish is the most menacing and that it was the language spoken by the Archangel Gabriel in dealing with Adam and Eve. I do not know whether there is any truth in that view, but it suggests that there are possibilities in developing our own languages.
      With a name such as mine, I could be none other than friendly to the development of the Welsh language, but it would be as a developing langauge and not as a language from the past. We want to see the development of the Welsh language as a modern language. No more harm could be done to the wider use of the Welsh language than any attempt to show prejudice in Wales against the use of the English language.
      As far as we know, the number of Welsh speakers in Wales is just over 20 per cent. Let us be generous and say that one-quarter of the Welsh people are Welsh speakers. Most of these Welsh speakers are, of course, bilingual. On the other hand, the vast majority of Welsh people do not speak Welsh at all. We must keep that fact clearly in our minds. The right hon. Member for Anglesey might like the position to be the other way round so that 75 per cent. of the Welsh people were bilingual, but the fact is that that is not the position. That factor must be taken into account in our arguments.
      The right hon. Gentleman asked why our fears arose on this topic, and he wondered whether there was any evidence of prejudice one way or the other. I am sure he would agree that the fact that
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      it was necessary for him to put the 1967 Act on the statute book was evidence of prejudice against the Welsh language in the past. Therefore, I believe that it would not be a bad thing to reaffirm in this Bill the importance of the Welsh language. Examined the other way round, I think that there is little evidence at the moment of prejudice against the English language in Wales, but it could be that as the population in Wales—over, we hope, a generation or two—becomes more bilingual between Welsh and English, there could be a degree of prejudice in certain appointments against those who speak only English and are not bilingual.
      The right hon. Gentleman knows that there are schools in Wales where the predominant language is Welsh and English is the second language. Unless one is a Welsh speaker, it is obviously inappropriate that one should be appointed to those schools.
      Mr. Cledwyn Hughes: It is a question not so much of prejudice but of common sense. It is not only a matter of public appointments. What must be borne in mind is that the four great clearing banks in my part of the world have appointed bank managers who are Welsh speaking, otherwise their business would go down. That is a matter of common sense.
      Mr. Price: That may well be so, and I should like to see more bilingual people in Wales. But, having said that, I think that it would be a pity if there were not a general statement written into the Bill that both languages coexist and that there should not be a prejudice against one or the other. The Wales Bill and the Scotland Bill are new departures in our arrangements. Therefore, we must examine these matters in terms not of today but of tomorrow. We are entitled to anticipate what could be prejudices in the future as such bodies as the Welsh Language Society pursue their aims by means that do not always commend themselves to Members of the House.
      Although I hope that my fears are groundless, I can see nothing but benefit in writing into the Bill provisions on the lines of the new clause. If the Government come forward with an alternative form of wording that achieves the same end, I shall be agreeable to accepting it. I hope that the enthusiasts for the Welsh

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      language will follow the old Welsh proverb "A gentle word will make the argument strong".
      Mr. Hooson: Although there are superficially attractive arguments in favour of the new clause and of Amendment No. 9, I think that they should be rejected. I believe that these proposals are highly divisive. I do not doubt the motives of those who tabled these provisions, and I know that there is a certain amount of fear in the House that language somehow will be used by the minority in the Assembly as a lever to thrust the language on other people, but I think that the whole concept behind these provisions is an insult to the people of Wales.
      Let me say why I take that view. For about 350 of the 450 years which have elapsed since the Act of Union was passed, there was a tremendous effort by the Government to get rid of the Welsh language. In Tudor times the 1542 Act was definitely aimed against the language. It was thought at the time that to ensure the unity of England and Wales it was necessary to get rid of the Welsh language as soon as possible. The excepion is that the order for the translation of the Bible came from a Tudor monarch, and nothing did more to preserve the Welsh language than the translation of the Bible into Welsh.
      However, over the last century or so one can see a gradual change in educational policy and in the policy of the Government in promoting the Welsh language and Welsh culture. By the time the Government decided to promote the language, it had already suffered enormous depredations. A vast amount of Government money had been spent over the centuries devoted to killing the Welsh language. The amount of money necessary for first aid was an amount commensurate with a language and a culture which had received grievous blows as a direct result of Government policy.
      We are gradually getting over that stage, and there is a general appreciation in Wales among non-Welsh-speaking people of the value of the Welsh language and culture and little genuine hostility towards it. I have been amazed at the contributions made to some of these debates by some hon. Members who should know better to the effect that, if
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      the Assembly is set up, language will be a divisive issue. I do not take that view.
      There are people in my constituency who are nearly monoglot Welsh speakers but who are against the Assembly. They do not take the view that the language will be divisive. I can understand people who do not want devolution or the Assembly and who put their point of view fairly and squarely, but I hate the raising of the prejudice involved in the Welsh language. Most right hon. and hon. Members have not raised such prejudices, but there have been exceptions.
      I well understand the motivation of those who tabled these provisions. I do not think that they are aiming their proposals at the Welsh language and I do not think that they intend to be divisive, but let us examine the wording of the proposals. The clause states:
      "the Assembly shall not do anything which would unreasonably prejudice the interests or restrict the employment opportunities of those who do, or those who do not, speak the Welsh language."
      There is an endless source of litigation in the interpretation of the words
      "would unreasonably prejudice".
      Is it not much better to leave the issue to the good sense and the good grace of Assembly Members? Bearing in mind the linguistic pattern of Wales, is there any reason to think that the elected Assembly representatives will be of a different pattern from the Members elected to this place? By and large, the House broadly represents the linguistic pattern of Wales as well as anything else.
      It is insulting to the people of Wales to suggest that it is necessary to provide this sort of rule. It should be left to the Assembly. If there is to be a statement about the language, both languages should be enshrined in the Bill as languages of equal validity.
      I represent a constituency where the linguistic pattern is close to the general linguistic pattern of Wales. About one in four of my constituents speak Welsh. About three-quarters do not speak Welsh, yet they would throw anything at anyone who described them as English. They regard themselves as non-Welsh-speaking Welsh people. There are many of them, and there were their forebears going back a couple of centuries.

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      In my constituency, which represents a fair pattern, we do not see people refused jobs for which they are appropriately qualified merely because they are not Welsh-speaking or because they are. There are obviously some jobs where the fact that the applicant is Welsh-speaking is an added qualification. The matter must be left to the good sense, the good taste and the sensivity of the Welsh people.
      If we are trying to save the minority language, the worst thing that we can do is to engender the hostility of the majority. If that is done, sympathy for the language and the culture is lost and steps are taken to try to stamp them out. If we take a more civilised view, we shall assist the Welsh language.
      The musical festival in my constituency is nearly always run by the non-Welsh-speaking section of the community. However, choirs take part from the Welsh-speaking section and it is supported equally by those who are Welsh-speaking and those who are non-Welsh-speaking. On the other hand, the committees of the Powys Eisteddfod are run very largely by the Welsh-speaking community. The money is often raised by the non-Welsh-speaking community as much as by the Welsh-speaking community. Both communities always support the eisteddfod. That is the pattern which has been established in my constituency, which is wedged between England and the constituency of my hon. Friend the Member for Cardigan (Mr. Howells).
      My constituency has had a linguistic pattern that is somewhat different from, for example, the linguistic patterns of Gwynedd or South Wales. The constituency of the hon. Member for Brecon and Radnor (Mr. Roderick) was anglicised more than mine many years ago. The people have learned to live with these patterns, and the bogymen that are raised when talking about language do not exist in practice.
      We should do nothing to suggest that it is necessary to incorporate in the Bill the sort of provisions that are in the new clause. The matter should be left open. If we are to have an Assembly, I am sure that those who are elected to it will behave in a civilised way conscious of the great Welsh heritage, whether it is in Welsh or in English.
      6.45 p.m.
      Mr. Ioan Evans: I tend to share the views expressed by the hon. and learned Member for Montgomery (Mr. Hooson) and by my right hon. Friend the Member for Anglesey (Mr. Hughes). I believe that we are considering fears that need never have been expressed. The major safeguard is that an Assembly would have to be re-elected. However, I can understand some of the fears that have been expressed. The hon. Member for Flint, West (Sir A. Meyer) referred to the possibility—he contemplated a fearful situation—of the Welsh Assembly being dominated by Plaid Cymru Members. We are, of course, dealing with a hypothesis. We may never have an Assembly.
      If there is to be an Assembly, and if there is the situation that the hon. Member for Flint, West postulated, Plaid Cymru Members may try to insert some compulsion rather than persuasion into the move towards the Welsh language. However, I tend to agree with my right hon. Friend the Member for Anglesey. I do not think that what was contemplated by the hon. Member for Flint, West is a likely eventuality. Even if that evil day should ever come, I am sure that it would be rectified, assuming that we have an Assembly in the first place. Provided that we do not get a one-party State, the people would take action.
      We have been talking about job opportunities, which are linked very much to education opportunities. I agree with John Stuart Mill, who said that education worked better by persuasion that persecution, by conviction rather than compulsion. My right hon. Friend the Member for Anglesey can take credit for the Welsh Language Act, 1967, which has given legal status to the language of Wales.
      There is no difference between the main parties on this issue. We all want to encourage the language. The difference between a small minority and the rest of us is that there are some who take measures that are repulsive to the majority in Wales. Those who try to encourage the Welsh language by painting out road signs are doing the language more harm than good. There is a small, vocal minority which, instead of trying to act through the ballot box and trying to take legal action, tries to take the law into its own hands. It takes action that is detrimental to the language.

      305
      All these matters are connected with education. We had some interesting figures from the hon. Member for Conway (Mr. Roberts), who told us that 1·2 per cent. of the people of Wales speak only Welsh. That is because of the education system. In August 1976, primary school pupils were assessed to ascertain whether they were fluent in Wales. Of those assessed, 52·4 per cent. were found to be fluent in Gwynedd and 28 per cent. in Dyfed. In the six other counties it was found that fewer than 10 per cent. were fluent. The figures are interesting. In Powys there were 9·3 per cent., in Clwyd 9·1 per cent., in West Glamorgan 5·5 per cent., in Mid-Glamorgan 3·9 per cent., in South Glamorgan 2·1 per cent. and in Gwent only ·2 per cent.
      Although it is to be hoped that Wales will move forward and will become bilingual, as my right hon. Friend the Member for Anglesey has said it is at present dominated by non-Welsh-speaking Welshmen, who are Welsh none the less. There are those of us in Wales who are just as proud of Dylan Thomas, who wrote his poetry in English in Wales, as we are of those who write their poetry in the Welsh language.
      There is a need to preserve and encourage the language. I am pleased to find that the Labour Party in Wales is putting forward the following proposals. First, it proposes that there should be a strong sense of priority as regards the most urgent and effective ways of helping the language. Secondly, it proposes that there should be respect for the views of the local community. Thirdly, it proposes that there should be respect for parental wishes and for the rights of the individual. Fourthly, it proposes a recognition of the essential need to prevent the language from becoming a divisive issue among the people of Wales. Fifthly, it proposes an acceptance of the view that the language can be saved only if the people of Wales want it, and not by compulsion.
      It is important that we should seek to persuade the people to become Welsh-speaking, but there must not be any attempt to compel them to do so. That is why, in a sense, there may be some justification for the Opposition intro-
      306
      ducing the clause and seeking to incorporate it in a Bill that is designed to cover all eventualities.
      Part of Clause 10 states:
      "The Assembly may do anything it considers appopriate to support … the Welsh language."
      That is a sweeping statement, but there is the safeguard that those who are elected will seek to be re-elected. Those who are elected will come largely from South Wales, Mid-Glamorgan and Gwent. I question, therefore, whether the Opposition should persist in dividing the House on this issue. If an Assembly was established and it insisted that ability to speak Welsh was essential for posts in it, that would be divisive. That would deny job opportunities to the many non-Welsh-speaking candidates. I do not see such a situation arising, however. We should not unnecessarily arouse dangers that will not materialise.
      I believe that all parties wish to encourage the language, and we would deplore it if the best person for a job in the Assembly was not appointed because of language considerations. The Assembly could say that Welsh was preferable or desirable. That would depend on the job. I agree that in some jobs fluency in Welsh would be essential; the Welsh language teacher is an example. It would, however, be wrong for the Assembly to insist that for administrative posts the Welsh language was essential.
      We should deplore the activities of those who seek to introduce compulsion. The hon. Member for Carmarthen (Mr. Evans) gave evidence to the Kilbrandon Commission in which he tended to indicate that in the future there might be an element of compulsion. I hope that his party does not think that we can change the situation in Wales by Compulsion. If anything is to be done, it must be done by persuasion. We must persuade people that we have a cultural heritage that must be encouraged in the future.
      I believe that the safeguard on this matter will be the people of Wales, 80 per cent. of whom are mainly English-speaking. I cannot imagine a situation in which a majority would be elected to the Assembly who would seek to bring about the type of compulsion to which the Plaid Cymru Members occasionally refer.
      Mr. Alec Jones: Many hon. Members have used words such as "fairness" and "reasonableness" and so on. I wonder though whether we are being as fair as we think if we seek to write a provision such as this into the Bill. The hon. Member for Conway (Mr. Roberts) said that we should seek to write into the Bill what we consider to be fair. That contains an element of conceit. It assumes that on the question of language we in this House would be fairer than would be an elected Assembly in Cardiff. I do not see that there is conclusive proof that in all such cases this House would always act in a fairer way.
      The new clause and Clause 10 refer to several subjects apart from language. But the Government believe that if a particular unfairness can occur—it was suggested that an example might be the Assembly's spending excessive sums on sponsoring the Welsh language—similar unfairness could occur by the Assembly deciding under Clause 10 to spend more money on the arts or on sport or on a whole range of other matters than some people would think was appropriate.
      Mr. Nicholas Edwards: Does not the Under-Secretary realise that our clause refers to actions which might prejudice the interests or restrict the employment opportunities of the persons concerned? Therefore, it could apply to any of the issues in the clause, not simply to language.
      Mr. Jones: I listened attentively to the debate, but I do not recall any hon. Member making any contribution to the debate without emphasising that there was a possibility of unfairness over the Welsh language. That was at the root of the debate. The form of words used suggests that there should be fairness to Welsh speakers and to non-Welsh speakers alike. In the new clause there is the automatic assumption that the House would be fairer than the Welsh Assembly, and there is also the suggestion that unfairness could occur only in relation to the Assembly's handling of the language issue.
      The hon. Member for Conway was somewhat concerned that the wording of the Bill permitting the Assembly to do anything it considered appropriate might go too wide. He conceded that those words have fairly respectable precedents,
      308
      however. I am advised that his reference relating Clause 10 to Section 111 of the Local Government Act 1972 is not strictly valid, as Section 111 would be more appropriately related to Clause 27 of the Bill.
      There are, however, good antecedents for this sort of terminology. A similar point to this was raised in our debates on the Welsh Development Agency Bill. Section 1(6) of the Welsh Development Agency Act reads:
      "The Agency shall have power to do anything … which is calculated to facilitate the discharge of their functions".
      At that time there was great suspicion about that provision. I believe, however, that in the end there was wide agreement in the Committee on that Bill that those fears were unfounded, and I believe hon. Members will agree now that the Welsh Development Agency has acted perfectly reasonably and there is no reason to suppose that the Assembly will do other than that.
      Mr. Nicholas Edwards: I apologise for interrupting the Minister again, but he has referred to the Welsh Development Agency. I dealt with the section he quoted during the Committee proceedings on the Bill. There is an important difference. On that occasion we were discussing a subordinate clause which referred to the principal functions of the Bill. Those powers could be exercised only subject to the principal functions. Here we are discussing a principal clause laying down a main function. Surely that is a considerable difference.
      Mr. Jones: If the hon. Member had waited a few seconds more, he would have heard my full explanation, which was sought by the hon. Member for Aylesbury (Mr. Raison) concerning hese powers. We have had a similar argument about the use of the words
      "shall have power to do anything".
      Experience has shown that those fears were unfounded in respect of the Welsh Development Agency.
      I believe that the new clause is unnecessary. The correct course of action is to leave the matter to the responsible people. There is some element of risk or danger in writing such a clause into the Bill. As the debate has shown, while hon. Members have used words such as

      309
      "fairness" and reasonableness", many of the speeches this afternoon have referred to confusion, division and exaggeration. Should the House be so foolish as to agree to the new clause, it would be adding to that confusion and division and to the exaggerated statements that we have heard today.
      The hon. Member for Conway said that this meant that the Welsh Assembly could act ultra vires. When people use Latin words to me, especially when they have legal connotations, I consult the oracle. I am given the advice that it is nonsense to suggest that the Assembly could act ultra vires. I am advised that the Assembly will be a statutory body and able to act only within the powers conferred by statute.
      7 p.m.
      The powers do not entitle the Assembly to override the general law. The clause confers on the Assembly the same functions as the Secretary of State now possesses. Those functions are
      "to support museums, art galleries, libraries, the Welsh language, the arts, craft, sport and other cultural and recreative activities."
      Those are the ordinary non-statutory powers or functions to which the hon. Member for Aylesbury referred. It means, for instance, that without such powers the Assembly would not be able to aid the National Museum of Wales, the Council of Museums in Wales or the National Library of Wales. It would not be able to give support to those organisations. It concerns the appointment of advisory bodies on the Welsh language, and it is the power which the Assembly would have to provide grants to support Welsh language publications.
      Mr. Brittan: Is the Minister saying that the sole effect of the clause is to permit the Assembly to carry out the non-statutory powers of the Secretary of State and, I suppose, those which are conferred upon him by the Royal prerogative? If so, does he not agree that a lot of fears would be put at rest if, instead of the clause reading as it does now, there was a clause saying that the Assembly may act in this area to the extent that the Secretary of State at present may lawfully do so? Such a provision would make the position clear. At the moment, there is nothing to indicate that these provisions
      310
      are in any way limited to the powers at present exercised on a non-statutory basis by the Secretary of State.
      Mr. Jones: I take the point made by the hon. and learned Gentleman. The advice given to me and my reading of the Bill indicate that that is what it does. It confers on the Assembly the same functions relating to the subjects listed in Clause 10 as the Secretary of State is now able to exercise. I assure the hon. and learned Gentleman that I shall take further advice on the matter. Should I accidentally have misled the House, I shall take steps to draw his attention to it so that corrective action might be taken. However, I am advised that it does nothing other than to confer on the Assembly the same functions as those possessed by the Secretary of State. Without such powers the Assembly would not be able to support many of the cultural organisations which the Secretary of State now supports, because his powers to do so are not statutory powers. For instance, the National Library of Wales is a Royal Charter body. Some such power is necessary.
      If there is no safeguard as to how the Secretary of State now exercises these powers, why should it be necessary to put some sort of safeguard on a democratically-elected body? The new clause talks of "unreasonable prejudice". One can have unreasonably prejudiced individuals. In my time in the House I have referred to some Conservative Members as being unreasonably prejudiced, and on other occasions Conservative Members have probably referred to me in such terms. But we are not talking about individuals or about conferring functions and powers on individuals. We are talking of conferring functions and powers on a balanced Assembly elected in accordance with the wishes of the Welsh electorate. Therefore, I cannot see that the Welsh electorate would elect a Welsh Assembly which would be dominated by people with unreasonable prejudices. If one were to suggest such a thing it would be a slight on the intelligence of the electorate of Wales and on those elected.
      Sir David Renton: Although the Assembly will lay down the policies, the detailed implementation of them will be carried out by officials of the Assembly, some of them quite minor officials. What

      311
      the Minister says must be applied not only to the democratically elected people who will be answerable to their electorate but to all the minor officials over whom the Assemblymen cannot hope to keep day-to-day control.
      Mr. Jones: I would have thought that an elected Assembly of about 80 Members would find it easier to keep that sort of control on civil servants than would I as one Minister or my colleagues. If there is such a difficulty, it must be present now and the Assembly would add to the weapons for controlling and overcoming that difficulty.
      Clause 10 gives powers to the Welsh Assembly to operate on behalf of Welsh people a wide range of powers related to the quality of life in Wales and, in the main, powers purely concerned with Welsh domestic affairs. It is, therefore, my view and that of the Government that the exercise of these functions can and should be left to the corporate wisdom of a democratically elected Welsh Assembly.
      The hon. Member for Conway called for sanity and a balanced approach. The powers provided by Clause 10 enable that to be achieved, and the Assembly can be relied upon to achieve it.
      Mr. Raison: In addition to the undertaking that the Minister has given to think about certain aspects of the clause, will he think about bringing in an amendment in another place which would embody the words which the Attorney-General used in a letter written to me? Those words, if they were written into the clause, even if they were not required legally, would remove some of the doubt. The Attorney-General said:
      "The powers conferred by the Clause do not include any power to impose legal duties or liability on the subject or to confer legally enforceable rights or immunities on the subject".
      If a proviso could be written into the clause embodying what the Attorney-General says in that sentence. I should feel happier about Clause 10 passing on to the statute book.
      Mr. Jones: There is always a danger that, if one opens the door a little, someone else will wish to push it open a little further. However, I take the point made by the hon. Member. After each day's debate, for the following couple of days, because of printing problems, we have
      312
      gone through the debate and tried to pick up any points which have been omitted. I have not seen the letter which the hon. Gentleman has received from the Attorney-General and would not expect to see it, as it is a letter from my right hon. and learned Friend to the hon. Gentleman. However, I shall examine the point raised by the hon. Gentleman again to see whether what he says is necessary. My advice is that it is not necessary because the fears that he has expressed are not real fears to be found in Clause 10. I shall look at the wording and the points made by the hon. Gentleman.
      The hon. Member for Conway called for sanity and a balanced approach. That can be achieved by the existing provisions in Clause 10 and the Assembly can be relied upon to achieve it.
      Mr. Wyn Roberts: As I said earlier, there are two major points with which we are concerned. We are all familiar with this type of clause that gives power to do anything. We are concerned that Clause 10 has developed and has reached a form where it appears to put no limitation and no inhibition on the Assembly.
      We do not intend to deny to the Assembly any of the executive powers that are clearly necessary, but to seek an assurance from the Minister—and he has dealt with certain aspects of that assurance—that the Assembly cannot go beyond what we would consider to be its proper authority. We want to see some form of limitation, and we see no limitation upon the power that is contained in the clause to do anything.
      The Minister mentioned the debate a similar clause in the Act which set up the Welsh Development Agency. But that clause says:
      "The Agency shall have power to do anything, whether in Wales or elsewhere, which is calculated to facilitate the discharge of their functions specified in subsection (3) above, or is incidental or conducive to their discharge."
      Those functions are specified. Our point is that the power given in Clause 10 is not a subsidiary power or a conducive, facilitating power. It is labelled in the Bill as a principal function, and we are concerned that there should be some limitation upon it.
      The other major point concerns discrimination. We have been told that we

      313
      should not introduce the question of discrimination on linguistic grounds and that it is best left alone. But, when we last debated the question of language and jobs in connection with the staffing of the Assembly, the Secretary of State accepted that there was concern. We all know that there is concern about linguistic divisions in Wales.
      The right hon. Member for Anglesey (Mr. Hughes) implied that, through our new clause, we were trying to denigate or insult the Welsh language. I am a Welsh speaker, and that is the last thing that I wish to do. I mentioned earlier the possibility that there will be a preponderance of non-Welsh speakers in the Assembly. Our new clause seeks to protect the Welsh speaker and the non-Welsh speaker alike and to ensure fair-
      ness between them in employment opportunities.
      We have had an interesting debate. I said that I preferred the wording of Amendment No. 9, and I still feel that way, but I understand that it is not possible for us to vote on that amendment. If it should appear wise to another place to table an amendment on the lines of Amendment No. 9, we should be very happy.
      The only way that we can indicate our feelings on the need for some limitation of the power of the Assembly in the context of Clause 10 and the need for protection against discrimination is by voting for New Clause No. 4.
      Question put, That the clause be read a Second time:—
      The House divided: Ayes 221, Noes 243.

      Division No. 196]

      AYES

      [7.15 p.m.

      Adley Robert

      Dunlop, John

      James, David

      Aitken, Jonathan

      Durant, Tony

      Jessel, Toby

      Alison, Michael

      Dykes, Hugh

      Johnson Smith, G. (E Grinstead)

      Amery, Rt Hon Julian

      Eden, Rt Hon Sir John

      Joseph, Rt Hon Sir Keith

      Arnold, Tom

      Edwards, Nicholas (Pembroke)

      Kaberry, Sir Donald

      Atkins, Rt Hon H. (Spelthorne)

      Emery, Peter

      Kershaw, Anthony

      Atkinson, David (Bournemouth, East)

      Eyre, Reginald

      Kimbail, Marcus

      Awdry, Daniel

      Fairbairn, Nicholas

      King, Evelyn (South Dorset)

      Baker, Kenneth

      Fairgrieve, Russell

      King, Tom (Bridgwater)

      Banks, Robert

      Farr, John

      Knox, David

      Bell, Ronald

      Fell, Anthony

      Lamont, Norman

      Bendall, Vivian (Ilford North)

      Finsberg, Geoffrey

      Latham, Michael (Melton)

      Bennett, Sir Frederic (Torbay)

      Fisher, Sir Nigel

      Lawrence, Ivan

      Bennett, Dr Reginald (Fareham)

      Fookes, Miss Janet

      Lawson, Nigel

      Biffen, John

      Forman, Nigel

      Le Merchant, Spencer

      Biggs-Davidson, John

      Fowler, Norman (Sutton C't'd)

      Lester, Jim (Beeston)

      Blaker, Peter

      Fox, Marcus

      Lewis, Kenneth (Rutland)

      Body, Richard

      Fry, Peter

      Lloyd, Ian

      Boscawen, Hon Robert

      Galbraith, Hon T. G. D.

      Loveridge, John

      Bowden, A. (Brighton, Kemptown)

      Gardiner, Edwards (S Fylde)

      Luce, Richard

      Boyson, Dr Rhodes (Brent)

      Gilmour, Sir John (East Fife)

      McAdden, Sir Stephen

      Braine, Sir Bernard

      Goodlad, Alastair

      McCrindle, Robert

      Brittan, Leon

      Gorst, John

      Macfarlane, Neil

      Brooke, Peter

      Gow, Ian (Eastbourne)

      MacGregor, John

      Brotherton, Michael

      Gower, Sir Raymond (Barry)

      MacKay, Andrew (Stechford)

      Bryan, Sir Paul

      Grant, Anthony (Harrow C)

      Marshall, Michael (Arundel)

      Buchanan-Smith, Alick

      Gray, Hamish

      Marten, Neil

      Buck, Antony

      Grieve, Percy

      Mates, Michael

      Budgen, Nick

      Griffiths, Eldon

      Mather, Carol

      Bulmer, Esmond

      Grist, Ian

      Maude, Angus

      Burden, F. A.

      Grylls, Michael

      Maudling, Rt Hon Reginald

      Butler, Adam (Bosworth)

      Hall-Davis, A. G. F.

      Mawby, Ray

      Carlisle, Mark

      Hamilton, Michael (Salisbury)

      Maxwell-Hyslop, Robin

      Chalker, Mrs Lynda

      Hampson, Dr Keith

      Mayhew, Patrick

      Channon, Paul

      Harrison, Col Sir Harwood (Eye)

      Meyer, Sir Anthony

      Churchill, W. S.

      Hayers, Rt Hon Sir Michael

      Miller, Hal (Bromsgrove)

      Clark, Alan (Plymouth, Sutton)

      Hawkins, Paul

      Mills, Peter

      Clark, William (Croydon S)

      Hayhoe, Barney

      Miscampbell, Norman

      Clarke, Kenneth (Rushcliffe)

      Heath, Rt Hon Edward

      Mitchell, David (Basingstoke)

      Clegg, Walter

      Hicks, Robert

      Moate, Roger

      Cooke, Robert (Bristol W)

      Higgins, Terence L.

      Molyneaux, James

      Cope, John

      Hodgson, Robin

      Monro, Hector

      Costain, A. P.

      Holland, Philip

      Montgomery, Fergus

      Critchley, Julian

      Hordern, Peter

      More, Jasper (Ludlow)

      Crouch, David

      Howe, Rt Hon Sir Geoffrey

      Morris, Michael (Northampton S)

      Crowder F. P.

      Howell, David (Guildford)

      Morrison, Hon Peter (Chester)

      Davies, Rt Hon J. (Knutsford)

      Hunt, David (Wirral)

      Neave, Airey

      Dean, Paul (N Somerset)

      Hunt, John (Ravensbourne)

      Neubert, Michael

      Dodsworth, Geoffrey

      Hurd, Douglas

      Newton, Tony

      Drayson, Burnaby

      Hutchison, Michael Clark

      Nott, John

      du Cann, Rt Hon Edward

      Hamilton, Archibald (Epsom & Ewell)

      Onslow, Cranley

      Page, John (Harrow West)

      Royle, Sir Anthony

      Taylor, Teddy (Cathcart)

      Page, Rt Hon R. Graham (Crosby)

      Sainsbury, Tim

      Tebbit, Norman

      Page, Richard (Workington)

      St. John-Stevas, Norman

      Temple-Morris, Peter

      Parkinson, Cecil

      Scott, Nicholas

      Townsend, Cyril D.

      Pattie, Geoffrey

      Shaw, Giles (Pudsey)

      Trotter, Neville

      Percival, Ian

      Shelton, William (Streatham)

      van Straubenzee, W. R.

      Pink, R. Bonner

      Shepherd, Colin

      Vaughan, Dr Gerald

      Powell, Rt Hon J. Enoch

      Shersby, Michael

      Viggers, Peter

      Prentice, Rt Hon Reg

      Silvester, Fred

      Wakeham, John

      Price, David (Eastleigh)

      Sims, Roger

      Walder, David (Clitheroe)

      Pym, Rt Hon Francis

      Sinclair, Sir George

      Walker, Rt Hon P. (Worcester)

      Raison, Timothy

      Smith, Dudley (Warwick)

      Wall, Patrick

      Rees, Peter (Dover & Deal)

      Speed, Keith

      Warren, Kenneth

      Renton, Rt Hon Sir D. (Hunts)

      Spence, John

      Wells, John

      Renton, Tim (Mid-Sussex)

      Spicer, Michael (S Worcester)

      Whitelaw, Rt Hon William

      Rhodes, James R.

      Sproat, Iain

      Wiggin, Jerry

      Ridley, Hon Nicholas

      Stanbrook, Ivor

      Winterton, Nicholas

      Rifkind, Malcolm

      Stanley, John

      Whitney, Raymond (Wycombe)

      Roberts, Michael (Cardiff NW)

      Steen, Anthony (Wavertree)

      Young, Sir G. (Ealing, Acton)

      Roberts, Wyn (Conway)

      Stewart, Ian (Hitchin)

      Younger, Hon George

      Rodgers, Sir John (Sevenoaks)

      Stokes, John

      Ross, William (Londonderry)

      Stradling Thomas, J.

      TELLERS FOR THE AYES:

      Rossi, Hugh (Hornsey)

      Tapsell, Peter

      Mr, Anthony Berry and

      Rost, Peter (SE Derbyshire)

      Taylor, R. (Croydon NW)

      Lord James Douglas Hamilton.

      NOES

      Allaun, Frank

      Doig, Peter

      John, Brynmor

      Anderson, Donald

      Dormand, J. D.

      Johnson, James (Hull West)

      Archer, Rt Hon Peter

      Douglas-Mann, Bruce

      Johnson, Walter (Derby S)

      Ashton, Joe

      Duffy, A. E. P.

      Jones, Alec (Rhondda)

      Atkins, Ronald (Preston N)

      Dewar, Donald

      Jones, Barry (East Flint)

      Bagier, Gordon A. T.

      Eadie, Alx

      Judd, Frank

      Bain, Mrs Margaret

      Edge, Geoff

      Kerr, Russell

      Barnett, Guy (Greenwich)

      Ellis, John (Brigg & Scun)

      Kilroy-Silk, Robert

      Barnett, Rt Hon Joel (Heywood)

      English, Michael

      Kinnock, Neil

      Bates, Alf

      Evans, Fred (Caerphilly)

      Lambie, David

      Bean, R. E.

      Evans, Gwynfor (Carmarthen)

      Lamborn, Harry

      Beith, A. J.

      Evans, Ioan (Aberdare)

      Lestor, Miss Joan (Eton & Slough)

      Benn, Rt Hon Anthony Wedgwood

      Evans, John (Newton)

      Lewis, Ron (Carlisle)

      Bennett, Andrew (Stockport N)

      Ewing, Harry (Stirling)

      Loyden, Eddie

      Bidwell, Sydney

      Flannery, Martin

      Lyon, Alexander (York)

      Bishop, Rt Hon Edward

      Fletcher, Ted (Darlington)

      Lyons, Edward (Bradford W)

      Blenkinsop, Arthur

      Foot, Rt Hon Michael

      Mabon, Rt Hon Dr J. Dickson

      Booth, Rt Hon Albert

      Forrester, John

      McCartney, Hugh

      Boothroyd, Miss Betty

      Fowler, Gerald (The Wrekln)

      MacCormick, Iain

      Bottomley, Rt Hon Arthur

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

      MacFarquhar, Roderick

      Boyden, James (Bish Auck)

      Freeson, Rt Hon Reginald

      MacKenzie, Rt Hon Gregor

      Bradley, Tom

      Freud, Clement

      Mackintosh, John P.

      Bray, Dr Jeremy

      Garrett, John (Norwich S)

      Maclennan, Robert

      Brown, Hugh D. Provan)

      George, Bruce

      McMillan, Tom (Glasgow C)

      Brown, Robert C. (Newcastle W)

      Gilbert, Dr John

      McNamara, Kevin

      Buchan, Norman

      Ginsburg, David

      Madden, Max

      Buchanan, Richard

      Golding, John

      Magee, Bryan

      Butler, Mrs Joyce (Wood Green)

      Gould, Bryan

      Mallalieu, J. P. W.

      Callaghan, Rt Hon J. (Cardiff SE)

      Gourlay, Harry

      Marks, Kenneth

      Callaghan, Jim (Middleton & P)

      Graham, Ted

      Marshall, Dr Edmund (Goole)

      Campbell, Ian

      Grant, George (Morpeth)

      Marshall, Jim (Leicester S)

      Canavan, Dennis

      Grant, John (Islington C)

      Mason, Rt Hon Roy

      Cant, R. B.

      Grocott, Bruce

      Maynard, Miss Joan

      Carmichael, Neil

      Hamilton, James (Bothwell)

      Mikardo, Ian

      Carter, Ray

      Hardy, Peter

      Miller, Dr M. S. (E Kilbride)

      Cartwright, John

      Harper, Joseph

      Molloy, William

      Castle, Rt Hon Barbara

      Harrison, Rt Hon Walter

      Morris, Charles R. (Openshaw)

      Clemitson, Ivor

      Hart, Rt Hon Judith

      Morris, Rt Hon J. (Aberavon)

      Cocks, Rt Hon Michael (Bristol S)

      Hattersley, Rt Hon Roy

      Moyle, Roland

      Cohen, Stanley

      Hayman, Mrs Helene

      Mulley, Rt Hon Frederick

      Coleman, Donald

      Hooley, Frank

      Cook, Robin F. (Edin C)

      Hooson, Emlyn

      Murray, Rt Hon Ronald King

      Corbett, Robin

      Horam, John

      Newens, Stanley

      Cowans, Harry

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

      Noble, Mike

      Craigen, Jim (Maryhill)

      Howells, Geraint (Cardigan)

      Oakes, Gordon

      Crawford, Douglas

      Hoyle, Doug (Nelson)

      Orme, Rt Hon Stanley

      Cronin, John

      Huckfield, Les

      Owen, Rt Hon Dr David

      Crowther, Stan (Rotherham)

      Hughes, Rt Hon C. (Anglesey)

      Padley, Walter

      Cryer, Bob

      Hughes, Robert (Aberdeen N)

      Palmer, Arthur

      Davidson, Arthur

      Hughes, Roy (Newport)

      Park, George

      Davies, Bryan (Enfield N)

      Hunter, Adam

      Parker, John

      Davies, Denzil (Llanelli)

      Irvine, Rt Hon Sir A. (Edge Hill)

      Parry, Robert

      Davies, Ifor (Gower)

      Irving, Rt Hon S. (Dartford)

      Pavitt, Laurie

      Davis, Clinton (Hackney C)

      Jackson, Colin (Brighouse)

      Pendry, Tom

      Deakins, Eric

      Jackson, Miss Margaret (Lincoln)

      Penhaligon, David

      Dean, Joseph (Leeds West)

      Janner, Greville

      Perry, Ernest

      Dell, Rt Hon Edmund

      Jay, Rt Hon Douglas

      Price, William (Rugby)

      Dempsey, James

      Jenkins, Hugh (Putney)

      Radice, Giles

      316

      317

      Rees, Rt Hon Merlyn (Leeds S)

      Smith, John (N Lanarkshire)

      Ward, Michael

      Reid, George

      Snape, Peter

      Watkins, David

      Richardson, Miss Jo

      Spearing, Nigel

      Watt, Hamish

      Roberts, Albert (Normanton)

      Spriggs, Leslie

      Weitzman, David

      Roberts, Gwilym (Cannock)

      Stallard, A. W.

      Wellbeloved, James

      Roderick, Caerwyn

      Stewart, Rt Hon Donald

      Welsh, Andrew

      Rodgers, George (Chorley)

      Stewart, Rt Hon M. (Fulham)

      White, Frank R. (Bury)

      Rodgers, Rt Hon William (Stockton)

      Stoddart, David

      White, James (Pollok)

      Rooker, J. W.

      Summerskill, Hon Dr Shirley

      Whitlock, William

      Roper, John

      Swain, Thomas

      Wigley, Dafydd

      Rose, Paul B.

      Taylor, Mrs Ann (Bolton W)

      Willey, Rt Hon Frederick

      Ross, Stephen (Isle of Wight)

      Thomas, Dafydd (Merioneth)

      Wlllams, Rt Hon Alan (Swansea W)

      Ross, Rt Hon W. (Kilmarnock)

      Thomas, Jeffrey (Abertillery)

      Williams, Alan Lee (Hornch'ch)

      Rowlands, Ted

      Thomas, Mike (Newcastle E)

      Williams, Rt Hon Shirley (Hertford)

      Ryman, John

      Thomas, Ron (Bristol NW)

      Wilson, Rt Hon Sir Harold (Huyton)

      Sandelson, Neville

      Thompson, George

      Wilson, William (Coventry SE)

      Sedgemore, Brian

      Thorne, Stan (Preston S)

      Wise, Mrs Audrey

      Sever, John

      Tierney, Sydney

      Woodall, Alec

      Shaw, Arnold (Ilford South)

      Tomlinson, John

      Woof, Robert

      Sheldon, Rt Hon Robert

      Torney, Tom

      Wrigglesworth, Ian

      Silkin, Rt Hon John (Deptford)

      Tilley, John (Lambeth, Central)

      Young, David (Bolton E)

      Silkin, Rt Hon S. C. (Dulwich)

      Urwin, T. W.

      TELLERS FOR THE NOES:

      Silverman, Julius

      Wainwrlght, Edwin (Dearne V)

      Mr. Thomas Cox and

      Skinner, Dennis

      Walker, Terry (Kingswood)

      Mr. James Tinn.

      Question accordingly negatived.

    New Clause No. 5

      WELSH DEVELOPMENT AGENCY AND DEVELOPMENT BOARD FOR RURAL WALES
      'Nothing in this Act shall be construed as permitting the Assembly to exercise all or any of the functions of the Welsh Development Agency or the Development Board for Rural Wales or to dissolve either of those bodies.'—[Mr. Nicholas Edwards.]
      Brought up, and read the First time.
      7.30 p.m.
      Mr. Nicholas Edwards: I beg to move, That the clause be read a Second time.
      On the seventh day of the Committee stage of the Bill, the guillotine prevented more than a passing reference to what I described then as the abolition or extermination clause, now numbered 60 in the amended Bill. That is the clause which, through a mist of peculiarly opaque parliamentary draftsmanship, enables the Assembly, if it can obtain the consent of the Secretary of State, to assume the powers of certain public bodies listed in a parliamentary answer on 16th March and to abolish those bodies. This House will note that it is not to be consulted about the matter.
      These bodies that less than three years ago Parliament was told were essential, and which it was persuaded to set up, can be swept away at the nod of a Secretary of State's head, along with a number of other quite important organisations. Despite all the special reasons given in the House during the proceedings that established these agencies, and despite the assurances, specific and oft repeated,
      318
      given to the House about ministerial and parliamentary control, they can be swept aside as a result of a clause that has not even been discussed by the House of Commons.
      Our new clause seeks to safeguard the position of two of them—the Welsh Development Agency and the Development Board for Rural Wales. They have been established by statute. The case for their continued existence has been repeatedly stated by Government spokesmen. In our view, they should not be threatened by this back-door process of extermination. If at some future date they no longer seem to justify their existence, they should be abolished by legislative process in this House.
      In a series of reckless speeches, the Secretary of State and his colleagues seek to create the impression that it is we on the Opposition Benches who threaten these organisations, yet as they make those speeches they force through without debate a clause that allows for the dissolution of these agencies without any reference to Parliament. It is the Secretary of State who is the potential executioner, not me.
      Let me make our position quite clear. We approach these agencies moderately and reasonably. If the WDA and the DBRW are doing a useful job, by clearing away dereliction, by creating infrastructure or by stimulating investment and thus job creation, if they are filling a gap that others are failing to fill, we should allow them to continue their work.
      False expectations have been raised about what these agencies can achieve. We fear that too often they back losers

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      rather than winners. We believe that from time to time they may actually destroy existing jobs, through subsidised competition, rather than create new jobs. None the less, as I made clear in a recent debate in the Welsh Grand Committee, we are relieved that the WDA has made a promising start and has gone a good way towards dispelling some of our earlier anxieties about the use to which it might be put. Both of the organisations seem to be making a determined attempt to base their investment decisions on commercial rather than political judgments. I can certainly see the advantage of seeking to operate regional policy at one remove from the political machine in this way.
      As we made clear in "The Right Approach", we have no plans to abolish the WDA, though we should like to see greater safeguards to prevent the acquisition of profitable companies and to ensure the eventual disposal of shares held by the agency. I understand that these two restrictions would cause no difficulty at all to the agency as it is at present operating or as it intends to operate under its existing management.
      As for the DBRW, we have never made a secret of the fact that we thought that there were disadvantages in having two separate bodies doing a job. Perhaps the hon. and learned Member for Montgomery (Mr. Hooson) will allow me to finish what I want to say about this organisation, because I want to set some of his fears at rest. We thought that there were disadvantages in having two separate bodies doing a job of a similar kind, with illogical boundaries and with a good deal of confusion and overlap.
      We ourselves proposed a solution with the framework of the WDA. All that I have said is that after a year or two we really ought to look at the way it has worked in practice and see whether any changes in the boundaries or responsibilities would be sensible and would improve the effectiveness of our efforts in Mid-Wales. There is nothing sacred about the structure that the present Government have chosen, but I hold the view that once something is set up there have to be good and powerful reasons for making sweeping changes. I therefore say no more than that I think that the time may come when we shall want to see whether any improvements can be made that will benefit Mid-Wales.
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      I deliberately approach both of these agencies—as I did during our debate in the Welsh Grand Committee—with the hope that we can build a bipartisan approach to these matters—an approach that will endure and will therefore help to create the kind of industrial confidence that is to important for Wales and for investment in Welsh industry. That moderate and pragmatic approach has conjured up a predictable wave of hysteria and the wholly untrue assertion that we proposed to abolish these bodies or drastically to trim their functions. We have no such proposals to make. It is the Government and their Liberal supporters who, within three years of moving the Second Reading of the Welsh Development Agency Bill, are drastically changing that organisation's relationship with central Government and theatening that it will cease to exist—because that is the effect of this Bill.
      Mr. Hooson: Is the hon. Gentleman able to give the House an absolute assurance that the Conservative Party has no intention of allowing the Development Board for Rural Wales to be taken over by the WDA?
      Mr. Edwards: I have made my position perfectly clear. If the hon. and learned Gentleman had listened to what I just said—
      Mr. Hooson: I did listen.
      Mr. Edwards: I said that I think that we should see how the DBRW performs. After a period of two or three years we should consider its performance and the way in which its responsibilities relate to those of the WDA, and see whether improvements can sensibly be made. I do not propose to go further than that now. It seems to me that, on the whole, that is a sensible way for Governments to approach these matters—not to make great dogmatic assertions at the Dispatch Box, provoked by interventions or otherwise, but to look at these questions in the light of experience, to try to learn from experience and to try to improve the operations of government in that way.
      Our new clause would remove the Welsh Development Agency and the Development Board for Rural Wales from the scope of Clause 60 and the threat of abolition. The Assembly, operating the investment powers of the Agency,

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      would be bound to do so in an increasingly political manner, which would be economically damaging and likely to cause mounting dissension with the United Kingdom Government.
      On Second Reading of the Welsh Development Agency (No. 2) Bill, on 26th June 1975, the Secretary of State referred to—boasted of, indeed—the powers of "general and specific direction", what he then described as "controlling powers". It is difficult to see how a Secretary of State who might exercise controlling powers in respect of an organisation for which he is responsible can exercise them without conflict when that organisation is not only possibly the responsibility of another Assembly but may actually be that Assembly itself, operating through its committee structure.
      Mr. Dalyell: I am really very confused. I thought that these Assemblies were not to have anything to do with the running of the economy. I should have thought that any decision on the future of the WDA, or—I speak with diffidence in the presence of my hon. Friend the Member for Brecon and Radnor (Mr. Roderick)—the Development Board for Rural Wales was basically an economic decision. Where is the line to be drawn?
      Mr. Edwards: I shall come on to that question later. I would rather wait for that point in my speech. I intend to explain just how the Government have changed their position and decided to split up the responsibility.
      The only curious difference that I would draw to the hon. Gentleman's attention is that, although there is a power in the Bill for the Assembly actually to take over the operations of the WDA with the Secretary of State's consent—and even to abolish it—I do not believe that such a power exists in relation to the Scottish Development Agency. Thus, a Scottish Bill contains legislative powers but does not enable the Scottish Assembly to take over or abolish the SDA, yet this Bill enables the Welsh Assembly to act in such a way towards the WDA. That is one of the obvious curiosities of this part of the Bill.
      The suggestion that the Assembly or its committees could sensibly carry out
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      the functions of the Agency is in direct conflict with everything that the Secretary of State and his Ministers said during the passage of the Welsh Development Agency (No. 2) Bill.
      I am sorry that the Secretary of State cannot spare the time to be with us tonight, because I now intend to refer, fairly extensively, to what he then said. On 26th June 1975, the right hon. and learned Gentleman said:
      "I see the agency—and I underline the word 'agency'—as a strong executive arm, with the power to act for the benefit of Wales and with sufficient finance available to it. It is an additional piece of executive machinery".
      It is hard to see how one can underline the word "agency" if its functions are to be carried on by a committee of an elected Assembly. In my judgment, an executive arm of government is the political arm; it is not an agency.
      The right hon. and learned Gentleman said later:
      "The agency will be expected to act on its own initiative to seek out opportunities and directly involve itself in industry. This type of entrepreneurial role is best performed by an agency."—[Official Report, 26th June 1975; Vol. 894, c. 684, 693.]
      We are entitled to ask how the Assembly is to involve itself directly in industry or to undertake an entrepreneurial role.
      7.45 p.m.
      In the guidelines issued by the Secretary of State to the WDA, we learn that
      "The Agency will be operating wholly in an assisted area"
      and that
      "a major part in the framing of its policies and initiatives"
      will inevitably be concerned with unemployment.
      The guidelines say that these policies and initiatives
      "will have to be closely co-ordinated with those of the Government insofar as selective financial assistance under the Industry Act 1972 and other measures available to the Government for the steering of industry will frequently be involved in individual cases."
      One is again bound to ask how that co-ordination will take place in the way envisaged in these guidelines when effectively different Governments will be operating a divided economic responsibility.

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      Also on Second Reading of the Welsh Development Agency (No. 2) Bill the Secretary of State said that
      "the agency has a big task. It will demand people of stature, strength and wide experience to carry it out. I intend that the board shall be composed of people of outstanding skills and experience rather than simply representatives of particular groups."—[Official Report, 26th June 1975; Vol. 894, c. 689.]
      Once again, the right hon. and learned Gentleman's words are incompatible with what is now proposed.
      Indeed, it is certain that if the functions of the agency were to be taken over by the Assembly it would be impossible to retain many of its existing staff or to recruit fresh people of outstanding skills and experience. It would be impossible to form commercial judgments and make investment decisions on a day-to-day basis in the manner prescribed for the agency if it were to be run as a political committee.
      When setting up these new bodies, Ministers were, at least for a time, diverted from their usual rhetoric about democratic control and brought face to face with reality. The nominated bodies that they so often condemn are frequently established, as they then admitted, for very good reasons—because of a need for expertise, because some jobs are better performed if removed from political pressure, because elected members may be the least suitable persons to perform certain tasks.
      Time and again, during the passage of the Welsh Development Agency (No. 2) Bill and the Development of Rural Wales Bill, Ministers talked eloquently of the need for expertise, for small effective bodies, for new and separate instruments.
      During our debate on the WDA Bill, the Under-Secretary said:
      "The hon. Member said it was important to have a substantial measure of independence for the members of the agency. Of course it is. I do not think that anyone doubts that."—[Official Report, Standing Committee E; 24th July 1975, c. 328.]
      He and his colleagues argued for a small body, for a carefully selected balance of personalities, for careful selection of the best talent. They gave assurances that politicians would not be giving directions every five minutes or concerning themselves with the minutiae of the Agency's affairs.
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      The guidelines talk about the need for the Agency to have
      "a large measure of operational and commercial freedom".
      It is shocking—it is an abuse of Parliament—that a Government should go through this extraordinary exercise of stating objectives, of setting up new organisations, of explaining and justifying ministerial and parliamentary control over these agencies, as the Government did in the case of the WDA, the DBRW and the Land Authority, at the precise moment when they are preparing legislation which would reverse or make a mockery of everything that they are saying. At the very moment that the Under-Secretary was giving us those undertakings about the future operation of the Agency he was preparing the Bill, or his parliamentary draftsmen were doing so on his behalf.
      I and others, including the hon. Member for Pontypool (Mr. Abse) challenged him on this point during those debates. We suspected that we were being misled and being asked to pass legislation on a false prospectus. We received a wholly evasive response, which confirmed our fears. They are now proved to be abundantly justified.
      The proceedings on the Welsh Development Agency Bill and those that established the other two bodies were misleading and disreputable. Parliament was not well treated. It is not an episode in which the Ministers involved should take any pride.
      Clause 60(2) contains the astonishing provision that the Assembly, with the consent of the Secretary of State, may modify any enactment that appears to it
      "to be necessary or expedient."
      Thus Parliament has lavished time, care and energy on producing legislation that it thought appropriate, but legislation that can, in connection with these statutory bodies, be swept aside by an Assembly, with the Secretary of State's consent, though that Assembly has no primary legislative function.
      That subsection on its own reduces to a meaningless charade every part of the proceedings on the Bills that I have described and makes the Ministers' assurances appear entirely worthless. That subsection, with the power to modify enactments, seems to open wide the

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      whole future role of the Assembly in economic management. Surely the implication is that the Assembly can not only take over the powers of the Agency but can seek to extend them and thus enlarge its role in economic management.
      I shall be told—I have already heard it muttered from the Liberal Benches—that the Secretary of State's consent is required, but he has already shown himself to be a reed blown by the wind when he has sought to establish a firm position on the economic role of Government. He has been shifting his position, so that now it is difficult to know where he stands.
      When the Government drew up the November 1975 White Paper, the intention was to build up the Secretary of State's responsibilities as an economic Minister—what the White Paper described as
      "an enhanced and very substantial economic role".
      The problem was that those transferred economic powers were the very ones that the Assembly would covet most, and immediately the pressures within the Welsh Labour Party began. We know that there has been a great fight within the party on this matter. The November 1975 scheme lasted only until the following May, when the Government conceded control of the Agency to the proposed Assembly.
      The economic aspirations of the Assembly will grow with time. They will not fade away. There is bound to be mounting tension in the relationship between the Secretary of State and the United Kingdom Government on the one hand and the Assembly on the other. It will arise, if for no other reason, because they are operating separate parts of an economic and industrial package—vital, integral parts, parts closely related together, as the guidelines make clear.
      The aspirations of those who favour these developments were spelled out with devastating clarity by John Osmond in "Creative Conflict". In an interesting passage, he refers to some of the disputed areas of the Welsh Development Agency—its budget, its planning role, its investment and loan decisions and its return on capital—and says that they
      "would be sure to provide wide opportunities for debate within a Welsh Assembly. The
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      issues would be likely to be so contentious that an Assembly would not be content to allow the Agency to remain a semi-autonomous separate body. All the pressure would be for the Agency to be absorbed into the administrative machinery of the Assembly itself. This possibility was allowed for in the Devolution Bill and was canvassed by the Labour Party in Wales's Executive Committee as early as the summer of 1975".
      He then quotes from the Committee, as follows:
      "It may happen in the future that the Assembly would wish to take over all functions of the Agency itself, with its actions being directly responsible to the Industrial Department and the Executive Committee [of the Welsh Assembly]."
      He continues:
      "One of the strongest arguments for devolution is that it would provide a focus for the political will that is necessary to give the Welsh Development Agency impetus, power and determination to tackle Wales's economic problems. The likelihood is that the Agency would have to be absorbed into the Assembly itself to facilitate the free flow of energy required."
      whatever that may mean.
      "The concession of the Government"
      —this is the crucial point—
      "in May 1976 that the Agency should be an Assembly responsibility was a recognition of the economic dimension of devolution. At that point the Agency became an embryo department of an evolving Welsh government. The structure necessary to forge a Welsh economic policy was being created. Devolution is about the promotion of the political will to make the structure work."
      So we are dealing here with the important matters. We are dealing with the continued independent existence of these agencies, the WDA and the DBRW. Their continued existence is likely to become a crucial factor in the fight that is already taking place for economic supremacy and the control of the Welsh economy.
      We believe that it is wrong that these bodies should be subject to extermination by the Assembly. They should remain responsible to the Secretary of State and, through him, to this Parliament. Economic and industrial power should remain with the United Kingdom Government, and the provisions of Clause 60 in relation to the WDA and the DBRW are incompatible with that concept. It would be gravely damaging to the United Kingdom economy and to the economy of Wales if within these islands we were to have increasingly powerful independent Governments competing with each other for limited resources and for the available jobs.

      327
      We think that our shared problems are better tackled on a shared basis. It is significant and very regrettable that a Government who have professed that they wish to retain responsibility for United Kingdom economic affairs, and have argued so frequently and so recently that the agencies are essential weapons in their armoury, should now introduce legislation that threatens both the future existence of the agencies and their own powers of economic management.
      The threat is implicit in the Bill as a whole. I commend the new clause as one barrier against some of its worst effects.
      Mr. Caerwyn E. Roderick: I am in no doubt about the purpose of the new clause. I am equally in no doubt why I set out on the road of supporting a Welsh Assembly. The very fact that we had so many appointed bodies spurred me on to want an elected body that would bring democratic control to many of our institutions in Wales.
      Clause 60 provides that the Assembly can assume—it may assume—the functions of bodies such as the Development Board for Rural Wales and the Welsh Development Agency. We in the Labour movement in Wales have for very many years been anxious to see that bodies such as these are brought directly under democratic control. They are answerable at present to a Minister. We can debate generally their functions and their activities but we are not keeping a sufficient scrutiny of the work that they undertake. We ought to have a body which has more time to look at them in greater detail.
      We are dealing here simply with the WDA and the DBRW. Whether these bodies are answerable to the Assembly or whether they become an integral part of the Assembly must, in my opinion, be for the Assembly itself to decide. It should decide how to organise its work. I think that there is a case to be made for retaining some kind of board as an executive, and for that board being answerable to the Assembly. Nevertheless, I would leave the decision to the Assembly.
      8.0 p.m.
      I am delighted to see that the hon. Member for Pembroke (Mr. Edwards) has shifted his ground somewhat in
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      recent days or weeks in regard to the Welsh Development Agency. After all that has been said against it, I am glad to see that he is now the first to defend it. What was said in the Welsh Grand Committee seemed to place some doubt over the future of the DBRW, and he has again shifted his ground and is anxious to defend that body.
      I should like to have an assurance from the hon. Gentleman that the WDA will not suffer the same fate as the Scottish Development Agency is promised by the Tory Party, if it is ever returned to power, because I understand that the Tory Party is on record as saying that it would abolish the Scottish Development Agency. I understand that the Welsh Tories do not follow this line in regard to the Welsh Development Agency, but how can we accept their assurances? They will not be taking the decision, surely. It will be a decision taken by the national party.
      Mr. Nicholas Edwards: May I make two points in response to the hon. Gentleman's remarks? First, I have not shifted my position on the DBRW. I said in the debate that we must look at the matter after two or three years' experience to see how it was working out in practice. I said something rather similar to that this afternoon.
      Secondly, the hon. Gentleman is entirely wrong in his remarks about the Scottish Development Agency. There is no party commitment to abolish the agency. Indeed, there is a clear statement in "The Right Approach" and by the spokesmen on Scottish Affairs that the SDA will be retained.
      Mr. Roderick: I accept what the hon. Gentleman says. I have obviously believed what I read in the Press. Certainly I am glad to have that assurance, because I would hate to think that it was Tory Party policy that the Agencies should be abolished.
      As for the DBRW, I remember the hon. Gentleman trying his best to entice me into a certain Lobby one night in this Chamber to support a proposal to have not a board but rather a subcommittee of the Agency to run affairs in the rural area. It was simply to be a part of the Welsh Development Agency. I am glad that I resisted the temptation, because ultimately we had a separate

      329
      board, which was what I wanted, to look after what was needed in the rural area of Wales or certain parts of Mid-Wales at least.
      These appointed bodies having been set up, I felt that this was only an interim stage, anyway, and that ultimately something would have to be done about controlling them. We now have the opportunity, with the Assembly, to finalise the Act, so to speak. I know that the hon. Gentleman and I cannot possibly look at the work of these bodies in detail because we have so many other things on our plate, but I hope that the Assembly will have the time and the resources to look at these Agencies.
      Sir Raymond Gower: Does the hon. Gentleman not see some difference between giving the Assembly the right of supervision over bodies such as these and giving it the right to dissolve them or to take over their functions? Does he see no distinction?
      Mr. Roderick: I do, indeed. There is a big distinction. Nevertheless, if the Assembly felt that it could undertake this work, I would be quite happy for it to do so, because then there would be elected representatives running the show. We are talking about public money here. It is we, the public, who will provide the funds. Surely, therefore, these bodies must be directly answerable to the public.
      I do not detract at all from the work that the Agencies are doing at present. I think that they are doing an excellent job. Nevertheless, it is difficult for the public to have any say in what is going on. This is why I would reject the new clause, and I hope that the House will reject it. I think it is important that we should go on with the work of introducing democracy at every level of our life.
      Sir Raymond Gower: What the hon. Member for Brecon and Radnor (Mr. Roderick) said makes me very apprehensive indeed about the future of these bodies.
      Mr. Hooson: Do not say that.
      Sir R. Gower: I acknowledge that when I heard my hon. Friend the Member for Pembroke (Mr. Edwards) introducing the new clause, I though that perhaps he might be exaggerating the
      330
      danger, but, having listened to the hon. Member for Brecon and Radnor, it is all too apparent to me that the danger is very real indeed, if that is the thinking behind the clause as it stands.
      I had assumed that the very use of the word "may" made it unlikely that this power to take over these bodies would ever be exercised. Many of us who started off with perhaps some anxiety about these bodies—and perhaps even those who were a little more optimistic about them—have had cause to feel very gratified by the way in which the Welsh Development Agency in particular has progressed. I believe that the same can also be said of the DBRW, although I cannot speak with such authority in that respect. These bodies have laid the foundations, I believe, of some significant achievement, It is bound to be a slow job, of course.
      The two bodies include persons of considerable expertise in industry and of considerable experience in the matters which have been conferred upon them by Parliament. As the months and years go by, their knowledge and expertise in the exercise of their functions will increase. It would be very foolish, therefore, to put this expertise at risk by having these bodies taken over by an elected body which may have no expertise at all. I think it has been said that the worst body to run a campaign is an elected committee. That is possibly true also of industry.
      Mr. Wigley: The hon. Gentleman is aware that the Welsh Development Agency is run by a committee, and it is a committee of experts. But the point is that, although they are experts in their own fields, in individual industries and in commerce, they may not be the most expert people for deciding what is needed in each part of Wales. That is why we need a greater interface between democratic control and expert knowledge.
      Sir R. Gower: I hope that they would have some prospect of continuity in their position. An elected body can never have that assurance of continuity. As I was saying, the persons on these bodies have very great experience. I have in mind, for example, Mr. Gray, who was formerly associated with the Board of Trade in Wales. These persons have very special talents in dealing with the matters which confront them, and it is desirable that

      331
      they should have the prospect of continuity for some period ahead and not be limited by the exigencies of elections every three or four years.
      Mr. Hooson: Surely the hon. Gentleman is confused about this matter. As I understand the position, Mr. Gray, is the Chief Executive and is in the same position, therefore, as a civil servant.
      Sir R. Gower: Yes.
      Mr. Hooson: The hon. Gentleman is getting confused. No one is suggesting that the Assembly should take over the job of the Chief Executive.
      Sir R. Gower: I accept what the hon. and learned Gentleman said. But there are other people involved, and they have greater continuity now than they could conceivably have if they were subject to the changes of fortune of parties in an Assembly. I would have hoped that we might have an assurance that this power, even as it stands, would be used only in the most extraordinary circumstances. But it appears from the remarks of the hon. Member for Brecon and Radnor that it is very likely that at an early date the Assembly would be disposed to take over these bodies.
      Mr. Roderick: I am afraid that the hon. Gentleman is putting words into my mouth. I said that it must be for the Assembly to decide. I do not know what the Assembly would do. I know what my preferences would be, but who am I to impose my will on the Assembly?
      Sir R. Gower: I accept what the hon. Gentleman says, but it did not sound like that when he was making his speech.
      Mr. Geraint Howells: He was very convincing.
      Sir R. Gower: Yes, he was very convincing about who would take them over.
      I am very impressed by the management of these bodies. I am impressed by the way in which they have started. I believe that they need a long period of stability. They need to have an assurance of stability for a considerable time ahead. I do not think it is desirable that they should be buffeted and exposed to the uncertainties of management by an Assembly, because while an Assembly has the advantage of demo-
      332
      critic management it will also be much more subject to the sort of pressures which are not necessarily an advantage in organisations of this kind. I am thinking of political pressures and so on.
      These bodies should exercise objective rather than subjective judgments. They should not have judgments forced upon them—
      Mr. Wigley: Surey the objectives of the Welsh Development Agency, it being a body in the public sector, must be objectives that are set with a total community and social measuring rod rather than a purely commercial one.
      Sir R. Gower: I do not think for a moment that the bodies as they are today are using purely commercial judgments. I am quite convinced that they go well beyond that. The hon. Gentleman must surely know that they are aware of their remit, which is much wider than ordinary commercial judgment.
      My hon. Friend the Member for Pembroke has expressed our anxieties as well as the undesirability of having in the Bill a clause as loose as Clause 60. It is very necessary to remove this doubt. That is why I support the new clause, which would make the takeover impossible.
      Mr. Dalyell: I resisted the temptation to take part in the last debate on the Welsh language. It would have been embarrassing to have done so. But I am not in the least embarrassed about taking part in this debate, because it is a matter for any United Kingdom Member of Parliament.
      I believe that we are sowing the seeds of very great trouble. This is not a minor matter. It is a deep, pivotal, basic confusion that pervades both the Scotland Bill and the Wales Bill. Indeed, it is once again a geological flaw in the Bill which again shows how its concept is built on shifting sand.
      I am in no mood to be told by anybody that I am making a Second Reading speech, because this is basic to the whole question. The reason why it is basic is that the question has not been answered about the role of these Assemblies. Are they to be involved in economic decision-making or not? This is where a number of pro-devolutionists—not only hon. Friends, but others—are trying to have

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      their cake and eat it or, to be a bit sharper about it, to speak out of both sides of their mouths at the same time.
      At one level we are told "Oh, no, the House of Commons and the whole structure of British Government need not bother, because no economic powers are involved." Yet, whenever they go to a different audience—albeit an audience which is perhaps favourable to the views of the hon. Member for Caernarvon (Mr. Wigley)—these people say that the Assemblies will solve all sorts of problems, especially economic problems. I have just come from the hustings, and very interesting—
      Mr. Deputy Speaker (Mr. Oscar Murton): Order. I must remind the hon. Gentleman that we are not in Committee. I think he will understand what I mean.
      8.15 p.m.
      Mr. Dalyell: In one phrase I would say that you, Mr. Deputy Speaker, should have heard the claims that were made about these Assemblies. Doubtless similar claims will be made in the Coal Exchange. There was very little reticence on the part of pro-devolutionists when they made claims as to how the major problem in the minds of the Scottish people—as it is of the Welsh people—namely, unemployment, will be helped by these Assemblies.
      Someone has got to get it straight precisely what the economic role is. I know there are difficulties about quoting the other place, but during a Division I wandered along there to hear the Lord Vaizey, an Oxford economist, tearing to pieces the Scotland Bill with regard to this matter. There was nothing that my hon. Friends on the Front Bench in the other place could say in answer.
      The truth is that there is a basic, deep confusion about whether the Assemblies are to have an economic role. The one thing that is certain is that one cannot have it both ways. Therefore, I put a very direct question to my hon. Friend the Under-Secretary of State. Can he, on this forty-third day, clear up whether or not the Assemblies are to have an economic role? There is a very simple answer to that. It is either "Yes" or "No". Somehow we have not quite understood it.
      Mr. Wigley: The hon. Gentleman said that in the elections that were held yesterday members of his own party in Scotland were pressing the strong economic powers that the Scottish Assembly will have. Does he ascribe the relative success of his party in those elections to pressing that point, particularly in the context of the situation 12 months ago when the Scotland and Wales Bill was in tatters?
      Mr. Dalyell: I have to report that in my own constituency those candidates who are even more anti-Assembly than I am did extremely well at the polls. I make not too much of that. But my one colleague who was pro-devolution did not do nearly as well as the rest. I do not draw any general conclusions from that. All I suggest is that being very scathing and aggressive about the need for an Assembly did not cost my colleagues votes at the local elections. I shall leave it at that.
      There is, of course, a practical consideration with regard to the Lords. I suspect that my noble Friend Lord Raglan—a Welsh Lord and chairman of a new town development corporation—will have something to say on these matters. I represent part of a new town. The question is whether the Welsh Assembly is to have the kind of economic control over new towns which has previously been associated with the Treasury.
      Mr. Nicholas Edwards: I left out a passage in my speech in which I had originally intended to refer to new towns. Is the hon. Gentleman aware that under Clause 60 the Assembly may take over the functions and dissolve new town corporations?
      Mr. Dalyell: Dissolving or not dissolving new town corporations is an economic act vitally affecting the United Kingdom Treasury. That is, therefore, yet another manhole and another confusion.
      I turn in the friendliest of spirits to my hon. Friend the Member for Brecon and Radnor (Mr. Roderick). If he were a Member of an Assembly—being an active man and a good Member of Parliament—is it conceivable that he would not demand these powers? He tells us that we should emphasise that the Assembly "can". In this context I think that the word "can" is a euphemism, because

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      any Member of Parliament worth his salt—and my hon. Friend is manifestly worth his salt—would assume that. He would not sit down and say "Of course, we should not have these powers." If he did, certain people in his valley would ask what he was doing.
      Mr. Roderick: Does not my hon. Friend acknowledge that every conceivable kind of body puts pressure upon us for more powers? It would not be simply Assemblies that would do so. Councils do it. Pressure groups of all kinds are formed to get more powers, but they are allowed more powers only with the authority of the Secretary of State. [HON. MEMBERS: "Parliament".] The Secretary of State through Parliament. I am not afraid of the Assembly pressing for more powers.
      Mr. Dalyell: I do not think that my hon. Friend is afraid of the Assembly pressing for more powers, because he might want it to do so, but I say to him in a friendly spirit that it might go a great deal further than he wants. Once one concedes certain powers in this area, one has to concede others. The return question is "All right. Where do we draw the line?" The Assembly is not a local authority. Comparisons between the Welsh Assembly and a local authority are misleading because here we are harnessing national aspirations—I do not know what else they are—which makes the Assembly very different, from a local authority.
      Therefore, I stick to my point that Assemblymen, if they have half the energy and drive of my hon. Friend the Minister of State, Foreign and Commonwealth Office, or of my hon. Friend the Member for Brecon and Radnor, would hardly be content to allow a situation in which, when they were able to assume more powers, they did not do so.
      I put one more question to my Front Bench. It has been revealed in another place—I had no notion of it during the passage of the Scotland Bill in this House—that of course these Assemblies can set up committees on any subject they please. When my noble Friend Lord Kirkhill was pressed on the matter—and I make no apology for repeating it—he said that the answer was "Yes". He said that the Scottish Assembly could have
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      a defence committee or a foreign affairs committee—I do not know whether my hon. Friend the Minister of State realises that—and no doubt, if it can have a foreign affairs committee, it can have an economic committee.
      So an economic committee on a non-devolved subject is thus set up. It has to justify itself. It has to have something to do. Is it conceivable that it would do other than press for precisely the kind of powers we are talking about in New Clause No. 5? Therefore, I say that this is a slippery slope stemming from a fundamental confusion in the Bill.
      Mr. Nick Budgen: One of the stranger practices of the House as I observe it is that. whenever the Government of the day appear to be handing out one of their discretionary grants, whether under the regional aid programme or under the Industry Act 1972, there is a tendency for those Members whose constituencies are the direct beneficiaries of the largesse of the taxpayers generally sometimes to thank the Minister, sometimes to complain that it is not enough, while, on the other hand, the broad mass of Members rarely seem to take any part in the discussion of the benefit that is going to any particular part of the United Kingdom.
      Yet that situation seems to me wholly illogical, for a benefit to one part is a disadvantage certainly to the parts immediately around it, and is also a disadvantage to the taxpayers of the United Kingdom and, indeed, to the economy of the United Kingdom. As the hon. Member for West Lothian (Mr. Dalyell) said, New Clause No. 5 goes to the heart of our consideration of the Bill because it decides whether there should be an economic role for the Welsh Assembly.
      If the Assembly is to have an economic role, as the hon. Gentleman says, no doubt it will wish to take on the role of the Welsh Development Agency and the role of the Development Board for Rural Wales. Here, I disagree in part with the emphasis put on this matter by my hon. Friend the Member for Barry (Sir R. Gower). He said that we are talking about the future of these bodies. We are not talking about the bodies themselves—we are talking most of all about the functions that they exercise. That is the thing—not the name, not even the subject, not even the experience. We

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      are talking about their functions in potentially distorting the economy of the United Kingdom in favour of Wales.
      It is their function, for example, to give extra grants to various industries in Wales. It is their function to give extra infrastructure in Wales. It will be for them to think of ways in which they can benefit even individual parts of Wales, or perhaps the whole of Wales. Yet the custom is that the general attitude of other Members in this House ought to be "Lucky old you. You have had a bit of a handout."
      But the reality is that any such hand out at least has to add to the public sector borrowing requirement. If we have an irresponsible Government, that leads to more inflation because the money is printed. If we have, as I concede we have in general at present, a financially responsible Government, it perhaps leads to cuts in public expenditure, although that seems to be less likely, or to increased tax, or to higher interest rates, with all the disincentive that that brings.
      So it is right that hon. Members from all parts of the United Kingdom should considers and consider carefully, any proposal to give economic advantage to a constituent part of the United Kingdom, and indeed it is perhaps right that I should be allowed to say something on behalf of my constituents, for the West Midlands has been gravely disadvantaged over the years by a succession of Governments imposing their regional policies upon it and the South-East.
      It is always thought that policies designed to benefit, let us say, Scotland, or Northumberland or Durham affect only Scotland, or Northumberland or Durham. No such thing. The policy of restricting factory and office development in the West Midlands has been to give a disadvantage to the West Midlands, and, it has been hoped, a compensating advantage to those areas which were formally areas of a higher level of unemployment and a lower level of prosperity than the West Midlands.
      Mr. Gwynfor Evans: Does the hon. Gentleman agree that the West Midlands, while losing as he has suggested, has gained a great deal from Wales, especially through the forced migration of hundreds of thousands of Welsh people, providing the West Midlands with labour
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      —very often the cheapest labour that it had?
      Mr. Budgen: I am a Unionist. I want the Union to continue. I applaud above all the reciprocal advantages that the Union has given to us. Of course what the hon. Gentleman says is true. We have benefited each other in the United Kingdom in peace and war, and in numerous and frequently referred to ways.
      Sir David Renton: In partnership.
      Mr. Budgen: Of course it is a partnership of benefit to us all. We are talking now of an Assembly which is being put forward as a means of placating the forces of separatism. Therefore, if we have to consider this on the basis of a partially separatist philosophy, those areas around Wales that are likely to be disadvantaged by any attempt to give economic advantages to Wales should consider their position.
      My basic proposition is that the West Midlands have been gravely disadvantaged by regional policies in recent years. I make no party point about this. Successive Governments of all variations of political hue have damaged the West Midlands by their regional policies. But it would be even worse—it would be compounding that felony—if the situation arose in which the people of Wales, through their subordinate Parliament, their Assembly, were able to assume an economic role and to give to themselves even greater advantages than would be accorded to them by the United Kingdom Parliament.
      I, as a loyal member of my party, accept that my party has said that it will accept the Welsh Development Agency and the Development Board for Rural Wales on what I hope I can reasonably describe as a provisional basis. After a couple of years we shall have a look and see, on perhaps a more practical than philosophical basis, whether those bodies have performed the functions that their proponents allege they have been set up to do.
      8.30 p.m.
      If those functions—and it is the functions about which I am concerned—are to be exercised at all, in fairness to the United Kingdom taxpayer and in fairness to those once-prosperous regions that are so close to the border of Wales, they

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      should be exercised by the Secretary of State for Wales, responsible to the United Kingdom Parliament, and should ultimately be exercised not in the narrow sectional interests of Wales alone but in the interests of the United Kingdom as a whole. It is for those reasons that I support the new clause.
      Mr. Hooson: The dichotomy of the Conservative Benches is very interesting. As I listen to the hon. Member for Pembroke (Mr. Edwards) and others speaking during these debates I gather that it is their view that Wales will be disadvantaged by the Assembly, and yet the view of the hon. Member for Wolverhampton, South-West (Mr. Budgen) is clearly that Wales has a potentially unfair advantage in having an Assembly. He thinks that the economic benefit that might be derived from the Assembly will be such that it will be unfair to his constituency in Wolverhampton, South-West, which is not very far from the Welsh border. I wish that Conservative Members would make up their minds which viewpoint is the official one on this matter.
      I find this whole problem one of considerable difficulty. I was tempted to support the new clause, until I heard the hon. Member for Pembroke moving it. I tell him frankly that I think there is greater danger of the removal of the Development Board for Rural Wales, which is of great importance to Wales, if the new clause is carried than if it is not.
      The hon. Gentleman said in the Welsh Grand Committee:
      "The third detailed point that I wish to make is that nothing that has happened so far inclines those of us who sit on these benches to change our mind about our belief that the Rural Development Board should not have been separated as it has been from the Agency. Certainly we shall want to look at that again."—[Official Report, Welsh Grand Committee, 23rd January 1978; c. 27.]
      The hon. Gentleman virtually repeated that statement today, using words similar to those that he used in the Welsh Grand Committee; namely, that the matter should be looked at again in two or three years' time. The Development Board for Rural Wales is under direct threat from the hon. Gentleman, and when I interrupted him today I was hoping to have an assurance that that was not so. Had
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      I received that assurance I might have taken a different view about this matter, but no such assurance was given.
      Nothing could be worse than to make the Development Board for Rural Wales as it were a sub-committee of the Welsh Development Agency. The Board is what it sets out to be. It is specifically charged with priming the pump and developing the rural areas, particularly those in Mid Wales that suffered enormously from depopulation. The Welsh Development Agency, on the other hand, has far greater responsibilities for the industrial areas. Its slant is different. Its thrust is different, and I see no case for amalgamating those bodies or for making one a subsidiary or a committee of the other.
      I know that the hon. Gentleman might not do that if he ever had the power to do so, and he has made that clear. On the other hand, he has also made clear from what he said in January and today that he would be minded to do that.
      Mr. Nicholas Edwards: I really do not think that the hon. and learned Gentleman can talk about direct threats when all that I have said is that I would like to see how organisations work in practice, and in the light of their experience, see if any improvements can be made. His accusation is a gross misuse of language.
      Mr. Hooson: If he had no such intention the hon. Member would not have used such generalised words. He would have been more specific. The words "to see what improvements can be made" could mean anything. And when one marries that to the actual words he used in January, that nothing had made him change his mind about the belief that the rural development board should not have been separated, as it has been, from the Agency, what other conclusion could any reasonable person reach?
      Sir Anthony Meyer: Would the hon. and learned Member not concede that there are disadvantages flowing from the fact that the remit of the Development Board for Rural Wales covered only certain parts of rural Wales, whereas the problems of rural Wales cry out to be dealt with as a whole? The problems of industrial Wales are dealt with as a whole by the Development Agency.
      Mr. Hooson: The Development Board for Rural Wales is young. It is all very well for the hon. Member to complain that its remit extends only to a limited area. Had it been left to his party we would not have had a rural development board at all. It is all very well now to say that its area should be larger. That was not the ground on which the Conservative Party opposed the setting up of the Board.
      Mr. Budgen rose—
      Mr. Hooson: I must make some progress, otherwise Mr. Deputy Speaker will be very cross with me.
      I want to look at the problem involved here, because there is a basic problem which has been little masked by what has been said so far. Clause 60 provides the powers, if the Secretary of State agreed with them, for the functions of certain of these bodies to be taken over by the Assembly.
      I believe that the Welsh Development Agency should be responsible to the Assembly. It should be a separate organisation, with its affairs discussed and debated at the Assembly. It is a wrong principle that bodies like the Development Agency should go on in their own sweet way, and that the way in which they carry out their functions should not be generally the subject matter for public debate.
      That is one of the functions that the Assembly could perform. There should be an accountability. Indeed, there are bodies that are accountable to this House, but we do not try to perform their functions. To whom is the Welsh Development Agency responsible? Nobody, really, except the Minister.
      It might be said that it is accountable to this House. But the truth is that we have discussed the Welsh Development Agency only once in the Welsh Grand Committee. We have an annual report, I agree. But there should be at least a couple of debates each year on the functions of the Development Agency. I cannot remember our having a debate on the Development Board for Rural Wales since it was set up. As has already been pointed out, we have only once had a debate on the Arts Council in Wales in the Welsh Grand Committee.
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      This shows that there is a function that the Assembly can perform, and it is a very important function when related to the Welsh Development Agency and the Development Board for Rural Wales. Personally I would like to see the Development Board more accountable to county councils because of the areas in which it functions. Even Cardiff is too remote for the accountability of the Board.
      Presumably, no function of the Development Agency or the Development Board can be taken over without the Secretary of State's consent. I can understand why this power is given, because, if the Welsh Assembly is to develop, it is bound to do so in a certain way. I have no doubt that before long, the Development Board will have its area extended, whatever the political complexion of the Government. These bodies are set up and they grow. When the Secretary of State first had this power he simply took over powers which had been in the hands of the Minister who was responsible for local government at the time, and various functions were added by different Governments. Health functions were added by one Government, educational functions by another and the system evolved in that way. The same will occur with the Development Agency. The fact that its powers will evolve does not mean that it will become an agency for separatism or anything of the kind.
      The House would like to be assured by the Minister that the Government do not intend in the near future to consent to any such takeover of functions. It is a different matter altogether whether it will do so in five, 10 or 15 years' time. It is difficult to return to this House for powers, because one has to join the legislative queue. Therefore, I see nothing wrong in taking powers which may eventually be exercised. If the hon. Member for Pembroke were Secretary of State, I understand that he would have no intention at present of consenting to a takeover of those powers, but the position may be different in 10 or more years' time.
      Sir David Renton: Has the hon. and learned Gentleman understood the full implications of his remarks? Does he not realise that by giving the Secretary of State power to hand over these two important bodies to the Welsh Assembly

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      without having to ask this House for an affirmative resolution or giving the House the opportunity to annul the order, he is creating a situation that the House should not accept because it is this House which, in the last resort, by voting the money, will enable either the Welsh Development Agency or the Development Board for Rural Wales to carry on at all, or to enable the Assembly to carry on on its behalf? If the House is to have the responsibility of voting the money ultimately, it should meanwhile have the responsibility of saying whether such a change should take place at all.
      Mr. Hooson: I understand that view, but if the right hon. and learned Gentleman stops to analyse the matter he will appreciate that we have delegated powers to many non-democratic bodies, to Ministers, their Departments, and so on, and this House never hears about those powers. But in this case we are delegating power to an Assembly. That elected Assembly will be responsible for the exercise of its functions. I know my fellow countrymen and I do not believe that they would elect to the Assembly people who will not discharge their democratic responsibility in a fair and proper way. There may be a difference of political view, but it will be no different from the position in this House. I fail to understand the fears expressed by the right hon. and learned Gentleman. He appears to be arguing against any form of devolution at any time.
      Sir D. Renton: No, that is not so.
      Mr. Hooson: The hon. Member for Wolverhampton, South-West said that his constituents would be at a disadvantage. I thought that he made out an excellent case for devolution to the West Midlands.
      Mr. Budgen: No, I did not.
      Mr. Hooson: I would have a great deal of sympathy with that view. The hon. Member suggested that the West Midlands would be at a disadvantage if Wales were devolved and the West Midlands were not.
      I have said enough to make clear that I intend to vote against the amendment, although I believe the Minister should make clear the Government's view on the discharge of this function and
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      give the Secretary of State's view about the timing of any changeover.
      8.45 p.m.
      Mr. Ioan Evans: I did not intend to participate in this part of the debate but I do so as certain misgivings have been aroused. When the Welsh Development Agency Bill passed through the House, there was a division among the parties. In the early stages, Conservative Members did not accept the idea of a Welsh Development Agency. However, now that the Bill has become an Act, I think that they have been persuaded to recognise that the Agency is performing a first-class function in Wales.
      We should remind ourselves that its functions were

      "(a) to further the economic development of Wales or any part of Wales;

      (b) to promote industrial efficiency and international competitiveness in Wales;

      (c) to provide, maintain or safeguard employment in any part of Wales; and

      (d) to further the improvement of the environment in Wales (having regard to existing amenity)."

      I believe that the Agency has performed a first-class job. It has issued its first report, which covers a period of longer than 18 months.
      We have heard a great deal about nominated bodies and the need for such bodies to be more accountable. The people whom we bring to the board of the Welsh Development Agency should be those with industrial expertise. That should be the qualification. I do not think that it makes the Agency any more democratic to suggest that its board members should be elected or be candidates for election to the Assembly and then be put on the board to run the Agency.
      Mr. Budgen: The element of democratic control is exercised by the Secretary of State, who has ultimate responsibility. The Secretary of State is in turn responsible to the House.
      Mr. Evans: I was about to make that point. I was saying that on the board of the Agency we have people with industrial experience from trade unions, industry and the CBI in Wales. They have expertise. They have acted as a board in the year or so that the Agency has been

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      operating. The Agency has done a first-class job. The Agency is answerable to the Secretary of State, who is in turn answerable to the House. Therefore, there is democratic accountability. If we find that the Secretary of State is exercising his powers by appointing board members whom we think unsuitable, it is up to us as Members of Parliament to let the Secretary of State know on the Floor of the House, in the Welsh Grand Committee or in correspondence that we take the view that he is not putting the best people on the board. In that sense there is accountability.
      I hope that when my hon. Friend the Under-Secretary replies he will be able to give us certain assurances. It has already been suggested that the Agency should be run by the Assembly. As I understand it, it is not one of the powers to be devolved to the Assembly. I understood that the Agency would continue to be administered by the Secretary of State and that it would be answerable to the House.
      Mr. Nicholas Edwards: That was the original proposal in November 1975. However, in May 1976 the Government issued a supplementary White Paper in which they handed over full responsibility for the Agency to the Assembly.
      Mr. Evans: If that is so, it has not been written into the Bill. Clause 37 is headed "Industrial and economic guidelines". I accept that there are industrial and economic guidelines, but there is not the transfer of the power to administer the Agency. The Agency is responsible to the Welsh Office and will continue to be so. It will not be responsible to the Assembly.
      Mr. Edwards: No doubt the Minister will clarify the position, but I think that the hon. Member for Aberdare (Mr. Evans) misunderstands it. As a consequence of this legislation, I believe that the Development Agency will be responsible to the Assembly but that the Secretary of State will still be issuing guidelines under the powers granted in Clause 37.
      Mr. Evans: We need clarification about this. The whole argument has been that we could devolve certain powers to the Welsh Assembly while maintaining the economic and political unity of the
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      United Kingdom. That is the whole purpose of the Bill. It will create a weakness if we put the running of the WDA under the Assembly.
      At the moment, funds are granted to the Agency by the House of Commons. We have been in the happy situation in Wales so far—no doubt due to the good management of the Agency—that not all the funds allocated have been taken up. But in future, if the Agency has to be covered by the block grant to the Assembly, that would be a retrograde step.
      We tend to think of economic and industrial investment in terms of the needs of the regions. Where the need is greater, we say that the investment should be greater. The need is certainly greater in Wales. There is also greater dereliction in Wales because of effects of the industrial revolution, because of the spoil heaps in South Wales and the slate quarries in North Wales. This adds up to a sensible argument in favour of Wales getting a higher proportion than other regions of the money provided to deal with this problem. But if the Agency and similar bodies, such as the Rural Development Board, are to be put under the auspices of the Assembly, does that mean that their financial requirements will have to be satisfied from the Assembly's block grant?
      I understand the desire to make all these nominated bodies democratically accountable, but I believe that that could be done without establishing all the paraphernalia of a Welsh Assembly. The Development Agency has got off to a good start, but if we are to make it responsible to the Asesmbly we shall create unnecessary uncertainties.
      Government money is allocated to Wales according to definite criteria which determine where the assistance should go. When the Assembly is established, will the allocation of funds be determined on the basis of political muscle in the Assembly? After all, the Assembly will be dominated by Glamorgan and Gwent, because that is where the majority of the population in Wales lives. Are we now to have some pressure brought on the Welsh Development Agency rather than leaving it to determine the industrial and economic criteria about where industry is to go? Are such matters now to be determined by the tact that certain

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      people are in a position to exercise more influence on decisions?
      The present arrangement whereby the Welsh Development Agency is answerable to the Government through the House has worked well. We can argue about whether certain powers will be devolved to the Assembly, but, if we are further to devolve economic powers, what financial arrangements should we make? Will it be said that the amount of finance that the Assembly shall receive will not be affected by such a decision? If so, that means that we shall have created a spending body with no ability to raise finance. We are electing people not to raise money but simply to spend it. If we are to give to the Welsh Assembly the power to tell the Welsh Development Agency what to spend, does it mean that there will not be any accountability in regard to the financial demands? This matter needs clarification. I hope that my hon. Friend the Minister can put my mind at rest.
      I believe that the Welsh Development Agency is doing a good job. It would be better if the Agency were to be accountable to the House, where the funds are, just as the National Enterprise Board is accountable to the House and as, I hope, will be the Scottish Development Agency and other development agencies which might be established in other parts of the country. We should not try to constrain and confine the activities of the Welsh Development Agency by tying it to the block grant that is allocated by the House to the work of the Welsh Assembly.
      Mr. Ian Grist: The hon. Member for Aberdare (Mr. Evans), as he often does, has made a sensible speech based on sound common sense—the common sense that will mean that the entire time we have spent on the Bill has been utterly wasted.
      The only thing to be said for the Bill is that it has got in the way of the Government's bringing forward other legislation which might be more damaging to the nation as a whole than that which we are debating. Nevertheless, we shall spend about £500,000 on this wretched referendum, only to arrive at the conclusion about which we all know, anyway.
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      The new clause and the arguments aroused by it have demonstrated why there will be a "No" vote. There is a question of conflict, which runs all the way through the Bill.
      Clause 60 promotes the idea that the Welsh Assembly will be able to take over the powers of the Development Agency and of the Development Board for Rural Wales. In passing, as an indication of lack of common sense, I regret to say that the speech of the hon. and learned Member for Montgomery (Mr. Hopson) took some beating. He complained that we were not debating—at least twice a year it seemed to me—the work of every nominated body in Wales, particularly the Board. When his party had a choice of what we would debate in the Welsh Grand Committee, it chose the Arts Council, for which we have no responsibility, and did not choose to debate the Board.
      As the hon. Member for West Lothian (Mr. Dalyell) said, the Welsh Assembly will demand the right to run these agencies and boards. It will have virtually nothing else to do, that is, unless it is to take over the day-to-day powers of the local authorities. We have been assured time and again that the Welsh Assembly will not take over the powers of the local authorities. What is it to do? Will not such a nationally elected body, with all its prestige, want to take over those nationally appointed bodies that come under it?
      9.0 p.m.
      Will the Assembly not also want to be responsible for the Welsh Development Agency? Of course it will and that will be the first pressure that any Secretary of State for Wales will be coming under.
      What happens then? It is possible that he may agree to give the Assembly the powers of the Agency. We have heard from the hon. Member for Caernarvon (Mr. Wigley) how he would like to see the powers of the Agency used by a politically motivated Assembly rather than an Agency the board of which is manned by industrialists and trade unionists who are appointed for their expertise to use their overall judgment over the whole of Wales, taking note of unemployment, as one of their functions, but not favouring this or that place in Wales.

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      An elected political body is bound to take note of those specifics that accord with the power of individual Assemblymen, the Prime Minister or chief executive and his Ministers. I have no doubt that the power of the Agency will be used to benefit those areas where the greatest influence can be brought to bear by the politicians of the Assembly. If that happens, the question of where the funds come from arises. If the Assembly is seen to be operating in that way, this House, which will be responsible for raising the money for the Assembly, will prove particularly sticky.
      What will be the role of Welsh Members in the House who will be putting forward the demands of the Assembly for money when they can see in their own backyards the misapplication of funds? It may be said that the funds will not be misapplied. If so, why should the Assembly be responsible for the Agency? It is either necessary or it is not. If it is politically necessary, I think that it is politically damaging.
      There is another obvious way in which conflict may arise between the Assembly and this House. Suppose this place had a Conservative Government and the Assembly, which was not Conservative, told the Secretary of State that it wanted to take over the functions of the Welsh Development Agency. The Secretary of State would say "Not on your life. I shall not allow you to operate in the Welsh economy contrary to the economic principles and practices of the Conservative Government."
      What would be the reaction of the Assembly, elected as a national body with all the prestige and power, the newness and excitement of that body? Would it not be to further the aims of nationalism and divisiveness in the United Kingdom? Is that not why, all along, nationalist Members have supported economic powers for the Assemblies in Scotland and Wales?
      Mr. Dalyell: Will the Assemblies not just say that they were insulted by any decision that did not suit their interests?
      Mr. Grist: Of course. That is what both these Bills are about. I believe that when the Wales Bill is put to the people, it will be rejected, and I hope, with increasing optimism, that the same will occur in Scotland. Yesterday's local government election results have set the
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      pattern for what is coming later in the year.
      What a waste of time for us all, and what a peril to the United Kingdom.
      Sir A. Meyer: The debate has been remarkable for one of the rare interventions of the Secretary of State's silent nightingale, the hon. Member for Brecon and Radnor (Mr. Roderick). It is always nice to hear the hon. Gentleman, but we do not hear him very often. Indeed, his interventions are almost as rare as the appearances of the Secretary of State at our debates.
      Of course, after the Secretary of State's bruising experiences when he last attempted to intervene in our debates, perhaps his absence is not so surprising. It may be that that experience accounts for the fact that we have heard little so far about the iniquity of these nominated bodies stuffed with Tory nominees and so on. I agree with the hon. Member for Aberdare (Mr. Evans) about the better way of securing democratic control over these nominated bodies. His sentiments will be echoed from both sides of the House. The way to do this is by strengthening the machinery of the House in its dealings with the activities of these bodies.
      I have few words to say in this debate. The hon. Member for Brecon and Radnor let the cat out of the bag when he made it plain how much he expected the Assembly to extend its economic activities. I try to convince myself that the Assembly, exercising the economic powers which it will clearly attempt to exercise, will be better able than the Welsh Development Agency as at present constituted to uphold the interests of Wales as a whole and to forward the economic development of Wales.
      If people are to be appointed to the board of the Agency on the ground of their acceptability to the Assembly rather than because of their qualifications for the job—and there will be conflicts between qualification for the job and acceptability to the Assembly—will the Agency be better able to ensure maximum development in the creation of jobs for Wales? Will such an Agency thus controlled by the Assembly have more appeal to those foreign investors who are so vital to the future of Wales?

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      A recent authoritative study demonstrated how many jobs in Wales come from foreign investment. Foreign investors are less concerned about whether there is democratic control over the activities of the Agency than whether it functions efficiently. I wonder whether the kind of democratic control which is envisaged by extending the powers of the Assembly will result in the Agency having a greater appeal to foreign investors.
      As the Minister knows, I am also anxious about the current proposal of Hotpoint to extend its activities into my constituency and about the attempt by a number of Merseyside Members to steer this development away from Wales towards Merseyside. In such a situation, would a development agency under the control of the Assembly be better able to withstand this kind of imperialism from across the Mersey than it is now? I have grave misgivings on this score.
      We are embarking on a path which will diminish the ability of the Development Agency to do its job. Like many of my hon. Friends, I have been agreeably surprised about the way in which it has set about its task. But if we do not insert the new clause the Agency will be unable to do its job in the satisfactory way in which it has done it during its brief existence.
      Mr. Gow: All the way through this Bill and all the way through the Scotland Bill, my right hon. and hon. Friends and I have argued that there is a recipe for continuing conflict and disagreement between the Assemblies and the House and for conflicts between the Assemblies and the Secretaries of State. We have argued that there are vast areas of great uncertainty, particularly in the Wales Bill.
      The new clause is, in effect, an amendment to Clause 60. Clause 60 is one of the most obscure and one of the most dangerous in the whole Bill. One of the extraordinary features of Clause 60 is that it does not specify the bodies to which it applies, yet it gives to the Assembly the power to take over the functions of unspecified bodies or to dissolve unspecified bodies, without the consent of this House, by a new statutory instrument not made in the way to which we have become accustomed but made by the Assembly, and the only limited extent
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      to which this House will have control of the exercise of the powers under Clause 60 is that those powers cannot be exercised save with the consent of the Secretary of State.
      It would have been incredible had it not actually been the fact that Clause 60 could have been inserted with no schedule setting out the bodies to which it relates. I tabled a Question for Written Answer to the Minister and he was good enough to answer giving a list of the bodies that might be affected. But we need to be very much more specific than giving a Written Answer in the House when we are debating legislation, and particularly legislation of a constitutional kind. Therefore, the new clause has the merit that it would at least tell us two bodies which are excluded from Clause 60, and that at least gives us some element of certainty. On that ground alone, I welcome the new clause.
      However, it is not only on that ground that I support the new clause. I am no particular friend of agencies or development boards, but for the moment I shall overcome my lack of enthusiasm for organisations of that kind because I want to direct my remarks to the Welsh Development Agency.
      The WDA was set up only three years ago, by the Welsh Development Agency Act 1975. Only last month there was presented to Parliament the first set of accounts of this new Agency, covering the period 1st January 1976 to 31st March 1977. We may note, in passing, that the accounts of that body were not actually presented to Parliament until very nearly 12 months has elapsed from the end of the first financial year, which was not a financial year but a financial 15 months, although I note that in passing.
      However, what are the powers that are conferred by Clause 60? Without recourse to this House, and with the consent of only the Secretary of State, that Agency, set up by Parliament, financed by the consent of this House, could be dissolved or taken over by the new Assembly. These are the powers that the Government are giving to the Assembly—to dissolve the very body which only three years ago the Government told the House was essential for the economic well-being of Wales.
      Within a space of three years, therefore, the Treasury Bench tells the House

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      that that which was regarded as essential to the well-being of Wales three years ago can now be executed, can have its head and its members dismembered. Nor is that all As if to add insult to injury, there is the breathtaking provision of subsection (3) of Clause 60. That provides that before committing an act of murder upon the agency the victim shall be consulted. This is carrying the traditions of 1789 too far.
      9.15 p.m.
      As you will know, Mr. Deputy Speaker, because you will have seen the document, in the report of the Comptroller and Auditor General we are told what are the duties—
      Mr. Deputy Speaker (Sir Myer Galpern): As the hon. Gentleman says, I have glanced at that report, but I fail to see what it has to do with New Clause No. 5.
      Mr. Gow: New Clause No. 5 would prevent the premature death of the Welsh Development Agency.
      Mr. Deputy Speaker: I understand that, but what has the report to do with New Clause No. 5?
      Mr. Gow: We are told in the report what are the functions of the Agency, whose death my hon. Friend the Member for Pembroke (Mr. Edwards) wishes to prevent. What I am now asserting are not the words of an unknown Back Bencher representing a seaside resort but the words in the report of the Comptroller and Auditor General. I am defending the Government's position. The Government should have welcomed this new clause. Since we are not likely to get a very credible answer from the Minister, I was offering not only my support but that of the Comptroller and Auditor General. I was arguing that he believes that the WDA is of great importance because he agrees with the Government. The Government themselves believe that the Agency is important, or they would not have set it up only three years ago.
      Mr. Dalyell: Who will look after the Welsh Development Agency in future—the United Kingdom Comptroller and Auditor General, who is responsible to the Public Accounts Committee, or the Welsh Comptroller and Auditor General?
      Mr. Gow: As ever, the hon. Gentleman has raised an important point. On page 51 of the Bill, in part IX of Schedule 2, there are listed the eight elements in the Welsh Development Agency Act 1975 which are excluded from the purview and responsibility of the Welsh Assembly. So not all the responsibilities under that Act will be devolved to the Assembly. That is another recipe for conflict.
      The Agency's purposes, of which the Government approve, of course, are also approved of by the Comptroller and Auditor General. In his report, he said:
      "The Agency's purposes are to further economic development; the improvement of the environment in Wales; to provide, maintain or safeguard employment there; to promote industrial efficiency and international competitiveness."
      Can the Government really be proposing to destroy, or to give to the Assembly the power to destroy, the very body which is carrying out objectives which on any view are intensely desirable?
      The Minister and I may disagree about whether an agency is the best body to provide, maintain and safeguard employment, but that is the Government's own case. It would be wrong to transfer to the Assembly the power to make an Order in Council under Clause 60 without the consent or approval of this House. For that reason, I shall support the new clause enthusiastically.
      Mr. Nicholas Fairbairn: We have in Scotland the Scottish Development Agency. It is important to appreciate that if we are to have Assemblies, they will have political reasons to demonstrate their strength, their attitudes and their political importance. If we give the Welsh Development Agency to the Welsh Assembly, the WDA will be able artificially to promote new industry, investment, and so on, and will thereby do what the SDA is doing now, in the name and the pretence of political interest.
      It is pretending to create employment, whereas all that it is doing is to move employment from one place to another and to move skilled labour from one place to another. It is bad enough that that should be done by central Government, but if it is to be done by an Assembly which has a political interest in the

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      very pretences in which the Development Agencies are presently indulging, by God, it will reflect upon this House!
      Mr. Dalyell: The hon. and learned Gentleman might reflect on the differences between the Scottish and Welsh Development Agencies. We understood very clearly from the Scotland Bill that, at any rate for the moment, the Scottish Development Agency was to be excluded from the Assembly's clutches. It was emphatically a non-devolved area. I was baffled to learn during the course of this debate how great are the powers of the Welsh Assembly over the Welsh Development Agency. It would be interesting to know the difference.
      Mr. Fairbairn: I am most obliged to the hon. Gentleman for that point. In the Scotland Bill we were wise enough to exclude that—thank goodness, because it would be the most dangerous political lunacy to allow the Scottish Assembly to buy votes, to buy attitudes, by spending its money. If Wales is to be given the alternative, that is bad.
      I am most in favour of the new clause, which would prevent the Welsh Assembly from using a political device, from obtaining an apparent advantage by spending money on a false and pretended political objective.
      Mr. Alec Jones: I was much impressed by the new-found love of the hon. Member for Pembroke (Mr. Edwards) for both the Welsh Development Agency and the Development Board for Rural Wales. It was not a love that found expression in other debates or in the way in which the Conservative Party voted on certain occasions. But I welcome the sinner who repenteth, even at a late hour.
      What the hon. Gentleman did not do—if, indeed, he intended doing it—was to allay the doubts and fears of the House, and certainly those Welsh Members who sat on the last Welsh Grand Committee, over his party's attitude towards the DBRW and the WDA. He clearly failed to give the assurances that the hon. and learned Member for Montgomery (Mr. Hooson) sought, particularly about the DBRW.
      It is true that the hon. Gentleman paid tribute to the Agency's work, but I find it difficult to believe that a Conservative Government would tolerate the existence
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      of a Welsh Development Agency and at the same time use their votes to remove a Scottish Development Agency, which the Press recently reported was the Conservatives' intention. Some of the contributions to today's debate strengthened my suspicions. I think that it can fairly be said that the hon. Member for Wolverhampton, South-West (Mr. Budgen) saw the WDA as giving an unfair advantage, to Wales. I cannot easily believe that a Conservative Government supported by that sort of view could give a strong future for the Agency.
      Mr. Nicholas Edwards: I do not understand why the hon. Gentleman, who is usually a very fair and reasonable debater, thinks that he adds to his case by repeating an assertion about the Scottish Development Agency on the basis of an ill-read Press report that I have already pointed out is wholly untrue. I suggest that the Under-Secretary does not repeat his scare story when it has been officially denied from the Conservative Benches.
      Mr. Jones: It may be said that it was only a Press report, but I recall the words that were used in criticising the idea of a Welsh Development Agency. It was my impression—I do not know whether I am right in this—that the hon. Member for Eastbourne (Mr. Gow) was not a lover of development agencies either, despite his representing a seaside resort.
      Sir Anthony Meyer: The Minister referred to the remarks of my hon. Friend the Member for Wolverhampton. South-West (Mr. Budgen), but did he not listen to any of the speeches of his hon. Friends from constituencies in the North-East and note the views that they held on devolution for Scotland and the way they voted?
      Mr. Jones: I have made a good many notes of what hon. Members have said in today's debate, and it is today's debate that I am specifically answering. I am particularly dealing with the two bodies operating in Wales.
      We are discussing New Clause No. 5 and its proposals for dealing with two of the nominated bodies that are covered by Clause 60, and it is important that to put that clause in its right context. It is a clause that deals with the whole

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      of the bodies which operate on an all-Wales basis. The new clause deals with only two of those bodies.
      It would be a mistake to believe that everyone throughout Wales welcomes with open arms the existence of such large numbers of nominated bodies, and their growth over recent years. There can be very few Members of this House, and certainly very few Welsh Members, who have not criticised those bodies, either individually or collectively, over the past few years. I have heard them criticised sometimes because they have made the wrong decision. Sometimes it has been because the decision did not appear to have been justified by events. Often it has been because the decision was made behind closed doors, without people having the opportunity of knowing about or taking part in the discussions until the decision was made. It is that sort of attitude that has led people to criticise these nominated bodies.
      In the Welsh Grand Committee debate only a few months ago hon. Members on both sides of the House criticised the Arts Council. The Sports Council has been criticised, because it is said that it spends too much money on golf and does not devote sufficient attention to deprived inner areas. Even the Welsh Development Agency, despite all the words of praise that have been uttered about it, has been criticised. I have heard criticisms because it has paid insufficient attention to parts of North Wales. I have heard criticisms because it has paid insufficient attention to Valley communities.
      All these nominated bodies have been criticised, and continue to be criticised. Part of that criticism concerns their very non-democratic nature and the way in which decisions are made. It is no reflection on the members who serve on those bodies to focus attention on that sort of criticism tonight.
      These bodies have considerable powers. Obviously, the powers vary from body to body. The two bodies that we are talking about—the Welsh Development Agency and the Development Board for Rural Wales—have economic powers now—this is part of the answer to my hon. Friend the Member for West Lothian (Mr. Dalyell)—and those economic powers will be exercised by those bodies or by some other person. We are basically concerned
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      with who is to control those powers—whether the control of those powers shall be exercised by the nominated element or whether they will be better controlled by an elected body.
      Mr. Grist: Does the Minister agree that it is he and his departmental colleagues who are responsible for these bodies? Does he feel that he is not democratically elected or is not democratically responsible to this House? Will he say in what way he would seek to improve the running of the Arts Council, for example?
      Mr. Jones: In making appointments to all these various bodies which proliferate throughout Wales, my right hon. Friend and I, and my ministerial colleagues, seek, with the best will in the world, to give them the widest expression and to draw on people who will best fit the job. I would be lying to the House if I were to say that I could give a categorical assurance that we had always picked the right person for the right job. It just is not on that one human being can be infallible in that connection.
      9.30 p.m.
      In Clause 60 we are seeking to allow the Assembly to consider whether the present control of the Welsh Development Agency and the Development Board for Rural Wales is adequate, whether it can be improved, and, whether the Assembly ought to subsume those two bodies. Whatever the decision, that decision will be made only with the approval of the Secretary of State. Even if those bodies were subsumed, those functions would still have to be carried out within the guidelines approved by Parliament.
      What I am saying is that these economic powers of the WDA and the DBRW will be exercised. Another point that I want to make is that the staff that man these bodies will still be doing that work in the future. What we are talking about is the question who shall have control of the way in which these bodies will be exercised. That is the issue that we are now discussing.
      Sir Raymond Gower: Might it be deemed something of an objection that the Minister is saying that power should be democratically exercised by the Assembly although the money provided for these bodies is provided by this

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      House? The Minister is in this House and should answer to this House rather than to someone who does not provide the money.
      Mr. Jones: If the hon. Gentleman had listened, he might have paid more attention to the fact that I referred to the guidelines. The guidelines are very powerful weapons of influence and control. They are approved by this House and will remain in existence, even should those bodies eventually be subsumed.
      Mr. Hooson: I do not think the Minister has quite dealt with the point that is worrying some hon. Members, namely, the interpretation of the word "functions". As I understand it, what he is saying is that bodies such as the Welsh Development Agency should be responsible to the Welsh Assembly. In that I agree with him. But it is a question of the functions now performed by those bodies. It is that word that is giving trouble.
      Mr. Jones: When I develop the point I think the hon. and learned Gentleman will see exactly what I am saying. I hope that it will be of some help, although I am not sure after some of the remarks that were made earlier, but not by the hon. and learned Gentleman. We are trying to devise a scheme that will give better and more democratic control over these all-Wales bodies. These all-Wales bodies will now be able to report, and become accountable, to the Assembly itself.
      What Clause 60 does not say is that the Assembly will subsume these all-Wales bodies. It does not even say that the Assembly ought to subsume them, or that it must subsume them. It can and may. That means that the Assembly can express its wish to take over part or all of the functions of such bodies. In other words, it can express its view about their future management, but always, before any decision can be made, subject to the approval of the Secretary of State.
      Mr. Brittan: Will the Minister explain why it is, within the context of the measures for devolution, when the Scottish Assembly is on the whole given greater powers, that the Welsh Assembly should be able to take over the powers of the Agency whereas the Scottish Assembly is
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      not given that power? Can there be any rational justification for that?
      Mr. Jones: These questions have been asked and I am prepared to answer them. When I come to that point in my speech I shall deal specifically with the reasons for the different treatment, but if hon. Members intervene at every moment I shall never answer any of the questions. I shall be dealing specifically with that point, because it was referred to by several hon. Members.
      Clause 60 gives the Assembly the powers, if it thinks it appropriate to use them, to consider and to initiate the machinery for subsuming as a means of furthering democratic and more efficient control. In my view, this does not mean abolition. It means putting those bodies under more democratic control. The WDA and the DBRW are only two of such bodies which the Welsh Assembly can consider subsuming and can even request it.
      Of course, the Assembly can also decide whether to leave them exactly as they are or to carry out some other minor reforms. But there is no question of any automatic assumption merely because the Assembly would want it. It is important to realise what the Assembly will do. Most hon. Members who support devolution do so on the assumption that the Assembly will consist of responsible men and women representing the best interests of Wales.
      The Assembly will want to devise the most effective tool for administering the powers of the WDA and the DBRW. It will want the most effective powers so that it can look after the interests of the whole of Wales. The first step will be to consider what action should be taken by the Assembly. The Assembly will first consider the possibilities of leaving these bodies in existence, modifying some of them, taking part powers, which the clause provides, or subsuming them.
      Then there is the next step. The Assembly is obliged by the Bill to consult the bodies concerned. One hon. Member referred to consulting the person whom one will murder later in the day. But surely consultation is an important element in our modern society. When we were discussing elements of the WDA and the DBRW upstairs in Committee, the Conservatives thought it desperately important that consultation should take

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      place. Therefore, surely they welcome this sort of consultation even if they disagree with the principle of devolution itself. Thus, consultation is the next step.
      Following the consultations, the Assembly would have to make its decision as to the course of action it wished to take. It could not take that decision in Committee. It would have to take it in plenary session. Then it would have to seek the approval of the Secretary of State. That means that the final decision on whether these two bodies or any other should be subsumed will be the decision of the Government of the day. I am sure that when the Secretary of State comes to make that decision on the subsumption of any of these bodies he will not be short of advice and will not lack knowledge of the views of the bodies concerned or of Members of this House.
      There will have been public debate and discussion in the Assembly. The bodies concerned will have expressed their views to the Secretary of State and to Members of this House—judging by the literature which floods through my mailbox—and because of the public discussion there will be public reaction to it. At the same time, there will be political pressure and questioning by Members in this House.
      Mr. Ioan Evans: On the question of the Welsh Assembly's taking over the running of the WDA, will my hon. Friend touch on the financial arrangements that will flow? Is the financing of the WDA to come through the block grant to the Assembly, or is there to be a special financial arrangement?
      Mr. Jones: We are back to phase I. This is the point that I made to the hon. and learned Member for Montgomery. I cannot answer questions straight off the trot like this. I shall be dealing presently with the point made by my hon. Friend the Member for Aberdare (Mr. Evans) and that made by the hon. and learned Gentleman. They are important.
      As I was saying, even if the order is made and the bodies are to be subsumed, and if the order is approved by the Secretary of State, that does not mean that the Secretary of State or the Government relinquish all control over the WDA and the DBRW.
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      Several important and essential powers are retained. One, which is of considerable importance and is to be found in Part IX of Schedule 2, is the power to provide selective financial assistance under Section 7 of the Industry Act. It is remarkable that Opposition Members who make speeches and ask questions are so unwilling to listen to any of the answers. We are talking about selective financial assistance under Section 7 of the Industry Act. The Welsh Development Agency does not have those powers as of right. It acts only as agent for the Secretary of State. If the Welsh Development Agency were subsumed the Assembly could become the agent of the Secretary of State, but only with the approval of the Secretary of State.
      The major restriction on the powers that will be exercised by the Assembly in the event of any subsumption of these bodies is to be found in the guidelines. The Agency at present operates under guidelines that are produced by the Government and are subject to the negative procedure of the House. Even if the Government were to agree that the Agency could or should be subsumed its operations would still be subject to those Government-provided guidelines. It is important to take into account that the guidelines have the parliamentary procedure attached to them. They are drawn up by the Government, and they will apply even post-devolution.
      When it was suggested that all these tremendous functions could be taken over by the Assembly, insufficient attention was paid to the importance and restrictive nature of the guidelines. Had hon. Members paid greater attention to Clause 37 and the spelling out in that clause of what the guidelines provide they would not have made the somewhat wild accusations that were made today.
      The hon. and learned Member for Montgomery asked whether we envisaged any early subsumption by the Assembly of the Welsh Development Agency and the Development Board for Rural Wales. The initiative will lie with the Assembly, but I am satisfied that a newly established Assembly will have enough on its plate to deal with the powers devolved under Schedule 2 and Clause 10, which were the subject of our previous debate, without wanting, in its early days, to

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      bite off a lot more than it can sensibly chew.
      The hon. and learned Member for Cleveland and Whitby (Mr. Brittan) does not have to accept that view, but it is my opinion, and I am as much entitled to hold my opinion as he or my hon. Friend are entitled to hold theirs. I do not deny their sincerity or integrity, and I do not see why anyone should suggest the opposite for me.
      A point was made about the difference between the Welsh and Scottish Assemblies. I understand that the establishment of the Scottish Development Agency is a reserved issue, because the Scottish Assembly has legislative powers and therefore could do away with that Agency entirely, leaving no organisation to carry out the reserved and executively devolved functions of that body. That situation could not apply in Wales, because the Welsh Assembly does not have the legislative powers to do likewise with its Agency.
      9.45 p.m.
      Mr. Brittan: The fact that the Scottish Development Agency has been set up by statute does not alter the point. It would have been perfectly possible in the Scotland Bill to reserve that aspect of the statute while at the same time enabling the Scottish Assembly to take over the powers of the Scottish Development Agency if it wished to do so. That was not done in the Scotland Bill and it is inconsistent to do it in the Wales Bill and allow the Welsh Assembly to take over those powers. It would have been perfectly possible within our legislative framework to put both bodies on an equal footing.
      Mr. Jones: Of course it would have been possible, but the decision was made early on. We decided at an early stage that there was to be a difference between the Wales Bill and the Scotland Bill. We believe that the whole process of devolution was drafted as necessary in Wales and in Scotland. Of course inconsistencies exist. They exist by the very nature of the fact that we have two different bodies to deal with.
      Sir Raymond Gower: Is the Minister aware that he has not revealed any cogent reason why this should have been done.
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      All he has said is that the decision was taken at an early stage.
      Mr. Jones: I clearly said that because the Scottish Assembly had legislative powers, it could exercise those powers in such a way as to do away completely with the SDA and leave nothing behind to carry out the reserved and effectively devolved functions. That situation cannot apply in Wales because the Welsh Assembly does not have those powers.
      I come to the point about the block grants. The devolved functions of both the Welsh Development Agency and the Development Board for Rural Wales will be financed from the outset from the block grant. The Assembly will decide how much and what share, but the guidelines will provide the protection for the interests of the United Kingdom as a whole. Of course Parliament will approve the total of the block grant.
      The hon. Member for Pembroke referred to Clause 60(2) concerning the power to modify an enactment being limited by the words "consequential, incidental or supplementary". Despite what the hon. Gentleman feared, this modification could not extend the functions taken over by the Assembly. Further, any modifications must appear necessary or expedient or an additional limitation to it.
      Mr. Nicholas Edwards: Only to the Assembly, not to anyone else.
      Mr. Jones: That is so. I am trying to show that we are treating all nominated bodies in Wales in exactly the same way leaving the initiative for action with the Assembly but still keeping considerable powers with the Secretary of State and the Government.
      For the Welsh Development Agency and the Development Board for Rural Wales, the powers reserved to the Secretary of State and the guidelines which are subject to the approval of this House, effectively give us the right mix. The opportunities for more democratic control of these two bodies will be achieved and at the same time there will be the retention by the Government—
      Mr. Deputy Speaker: Order. There is far too much conversation going on in the Chamber.
      Mr. Jones: As I was saying, I believe that the clause as it stands achieves the right mix between democratic control and the retention by central Government of the necessary powers which will prevent actions being taken by the Assembly which might be interpreted as unfair to other parts of the United Kingdom. For these reasons, I ask the House to reject the new clause.
      Mr. Dalyell: Before the Minister sits down—
      Mr. Deputy Speaker: The Minister has already sat down.
      Mr. Dalyell: The Minister, no doubt inadvertently—
      Mr. Deputy Speaker: The House is now on Report. The Minister has sat down, and the hon. Member for West Lothian (Mr. Dalyell) cannot speak twice on a clause.
      Mr. Dalyell: On a point of order, Mr. Deputy Speaker. I think that I rose to my feet before the Minister sat down.
      Mr. Deputy Speaker: I repeat that the Minister had already sat down.
      Question put, That the clause be read a Second time:—
      The House divided: Ayes 225, Noes 243.

      Division No. 197]

      AYES

      [9.50 p.m.

      Adley Robert

      Fairbairn, Nicholas

      Lawson, Nigel

      Aitken, Jonathan

      Fairgrieve, Russell

      Le Merchant, Spencer

      Alison, Michael

      Farr, John

      Lester, Jim (Beeston)

      Amery, Rt Hon Julian

      Fell, Anthony

      Lewis, Kenneth (Rutland)

      Arnold, Tom

      Finsberg, Geoffrey

      Lloyd, Ian

      Atkins, Rt Hon H. (Spelthorne)

      Fletcher, Alex (Edinburgh N)

      Loveridge, John

      Atkinson, David (Bournemouth, East)

      Fookes, Miss Janet

      Luce, Richard

      Awdry, Daniel

      Forman, Nigel

      McAdden, Sir Stephen

      Baker, Kenneth

      Fowler, Norman (Sutton C'f'd)

      McCrindle, Robert

      Banks, Robert

      Fox, Marcus

      Macfarlane, Neil

      Bell, Ronald

      Fraser, Rt Hon H. (Stafford & St)

      MacGregor, John

      Bendall, Vivian (Ilford North)

      Fry, Peter

      MacKay, Andrew (Stechford)

      Bennett, Sir Frederic (Torbay)

      Galbraith, Hon T. G. D.

      Macmillan, Rt Hon M. (Farnham)

      Bennett, Dr Reginald (Fareham)

      Gardiner, George (Reigate)

      Marshall, Michael (Arundel)

      Benyon, W.

      Gardner, Edward (S Fylde)

      Marten, Neil

      Berry, Hon Anthony

      Gilmour, Sir John (East Fife)

      Mates, Michael

      Biffen, John

      Glyn, Dr Alan

      Mather, Carol

      Biggs-Davidson, John

      Goodhart, Philip

      Maude, Angus

      Blaker, Peter

      Goodlad, Alastair

      Maudling, Rt Hon Reginald

      Body, Richard

      Gorst, John

      Mawby, Ray

      Boscawen, Hon Robert

      Gow, Ian (Eastbourne)

      Maxwell-Hyslop, Robin

      Bottomley, Peter

      Gower, Sir Raymond (Barry)

      Mayhew, Patrick

      Bowden, A. (Brighton, Kemptown)

      Grant, Anthony (Harrow C)

      Meyer, Sir Anthony

      Boyson, Dr Rhodes (Brent)

      Griffiths, Eldon

      Miller, Hal (Bromsgrove)

      Brittan, Leon

      Grist, Ian

      Mills, Peter

      Brocklebank-Fowler, C.

      Grylls, Michael

      Miscampbell, Norman

      Brooke, Peter

      Hall-Davis, A. G. F.

      Moate, Roger

      Brotherton, Michael

      Hamilton, Archibald (Epsom & Ewell)

      Molyneaux, James

      Bryan, Sir Paul

      Hamilton, Michael (Salisbury)

      Monro, Hector

      Buchanan-Smith, Alick

      Hampson, Dr Keith

      Montgomery, Fergus

      Buck, Antony

      Harrison, Col Sir Harwood (Eye)

      More, Jasper (Ludlow)

      Budgen, Nick

      Havers, Rt Hon Sir Michael

      Morgan, Geraint

      Bulmer, Esmond

      Hawkins, Paul

      Morris, Michael (Northampton S)

      Burden, F. A.

      Hayhoe, Barney

      Morrison, Hon Peter (Chester)

      Butler, Adam (Bosworth)

      Heath, Rt Hon Edward

      Mudd, David

      Carlisle, Mark

      Hicks, Robert

      Neave, Airey

      Chalker, Mrs Lynda

      Hodgson, Robin

      Neubert, Michael

      Channon, Paul

      Holland, Philip

      Newton, Tony

      Clark, Alan (Plymouth, Sutton)

      Clark, William (Croydon S)

      Hordern, Peter

      Nott, John

      Clarke, Kenneth (Rushcliffe)

      Howell, David (Guildford)

      Onslow, Cranley

      Clegg, Walter

      Hunt, David (Wirral)

      Page, John (Harrow West)

      Cooke, Robert (Bristol W)

      Hunt, John (Ravensbourne)

      Page, Rt Hon R. Graham (Crosby)

      Cope, John

      Hurd, Douglas

      Page, Richard (Workington)

      Cormack, Patrick

      Hutchison, Michael Clark

      Parkinson, Cecil

      Costain, A. P.

      James, David

      Pattie, Geoffrey

      Critchley, Julian

      Jessel, Toby

      Percival, Ian

      Crouch, David

      Johnson Smith, G. (E Grinstead)

      Pink, R. Bonner

      Crowder F. P.

      Joseph, Rt Hon Sir Keith

      Powell, Rt Hon J. Enoch

      Davies, Rt Hon J. (Knutsford)

      Kaberry, Sir Donald

      Prentice, Rt Hon Reg

      Dodsworlh, Geoffrey

      Kimball, Marcus

      Price, David (Eastleigh)

      Drayson, Burnaby

      King, Evelyn (South Dorset)

      Pym, Rt Hon Francis

      du Cann, Rt Hon Edward

      King, Tom (Bridgwater)

      Raison, Timothy

      Dunlop, John

      Knox, David

      Rathbone, Tim

      Edwards, Nicholas (Pembroke)

      Lamont, Norman

      Rees, Peter (Dover & Deal)

      Emery, Peter

      Latham, Michael (Melton)

      Renton, Rt Hon Sir D. (Hunts)

      Eyre, Reginald

      Lawrence, Ivan

      Renton, Tim (Mid-Sussex)

      Rhodes, James R.

      Smith, Dudley (Warwick)

      Vaughan, Dr Gerard

      Ridley, Hon Nicholas

      Smith, Timothy John (Ashfield)

      Viggers, Peter

      Rifkind, Malcolm

      Speed, Keith

      Wakeham, John

      Roberts, Michael (Cardiff NW)

      Spence, John

      Walder, David (Clitheroe)

      Roberts, Wyn (Conway)

      Spicer, Michael (S Worcester)

      Walker, Rt Hon P. (Worcester)

      Rodgers, Sir John (Sevenoaks)

      Sproat, Iain

      Wall, Patrick

      Ross, William (Londonderry)

      Stainton, Keith

      Walters, Dennis

      Rossi, Hugh (Hornsey)

      Stanley, John

      Warren, Kenneth

      Rost, Peter (SE Derbyshire)

      Steen, Anthony (Wavertree)

      Weatherill, Bernard

      Sainsbury, Tim

      Stewart, Ian (Hitchin)

      Wells, John

      St. John-Stevas, Norman

      Stokes, John

      Whilelaw, Rt Hon William

      Scott, Nicholas

      Stradling Thomas, J.

      Whitney, Raymond (Wycombe)

      Shaw, Giles (Pudsey)

      Tapsell, Peter

      Wiggin, Jerry

      Shelton, William (Streatham)

      Taylor, R. (Croydon NW)

      Winterton, Nicholas

      Shepherd, Colin

      Taylor, Teddy (Cathcart)

      Wood, Rt Hon Richard

      Shersby, Michael

      Tebbit, Norman

      Younger, Ron George

      Silvester, Fred

      Temple-Morris, Peter

      Sims, Roger

      Townsend, Cyril D.

      TELLERS FOR THE AYES:

      Sinclair, Sir George

      Trotter, Neville

      Sir George Young and

      Skeet, T. H. H.

      van Straubenzee, W. R.

      Lord James Douglas-Hamilton,

      NOES

      Allaun, Frank

      Duffy, A. E. P.

      Lambie, David

      Anderson, Donald

      Dewar, Donald

      Lamborn, Harry

      Archer, Rt Hon Peter

      Eadie, Alex

      Lamond, James

      Ashton, Joe

      Edge, Geoff

      Lewis, Ron (Carlisle)

      Atkins, Ronald (Preston N)

      Ellis, John (Brigg & Scun)

      Loyden, Eddie

      Bagier, Gordon A. T.

      English, Michael

      Luard, Evan

      Bain, Mrs Margaret

      Ennals, Rt Hon David

      Lyon, Alexander (York)

      Barnelt, Guy (Greenwich)

      Evans, Gwynfor (Carmarthen)

      Lyons, Edward (Bradford W)

      Barnett, Rt Hon Joel (Heywood)

      Evans, John (Newton)

      Mabon, Rt Hon Dr J. Dickson

      Bates, Alf

      Ewing, Harry (Stirling)

      McCartney, Hugh

      Bean, R. E.

      Ewing, Mrs Winifred (Moray)

      MacCormick, Iain

      Beith, A. J.

      Faulds, Andrew

      McDonald, Dr Oonagh

      Benn, Rt Hon Anthony Wedgwood

      Flannery, Martin

      McElhone, Frank

      Bennett, Andrew (Stockport N)

      Fletcher, Ted (Darlington)

      MacFarquhar, Roderick

      Bidwell, Sydney

      Foot, Rt Hon Michael

      MacKenzie, Rt Hon Gregor

      Bishop, Rt Hon Edward

      Forrester, John

      Mackintosh, John P.

      Blenkinsop, Arthur

      Fowler, Gerald (The Wrekin)

      Maclennan, Robert

      Boardman, H.

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

      McMillan, Tom (Glasgow C)

      Booth, Rt Hon Albert

      Freeson, Rt Hon Reginald

      McNamara, Kevin

      Boothroyd, Miss Betty

      Freud, Clement

      Madden, Max

      Boyden, James (Bish Auck)

      Garrett, John (Norwich S)

      Magee, Bryan

      Bradley, Tom

      George, Bruce

      Mallalieu, J. P. W.

      Bray, Dr Jeremy

      Gilbert, Rt Hon Dr John

      Marks, Kenneth

      Brown, Hugh D. (Provan)

      Ginsburg, David

      Marshall, Dr Edmund (Goole)

      Brown, Robert C. (Newcastle W)

      Golding, John

      Marshall, Jim (Leicester S)

      Buchan, Norman

      Gould, Bryan

      Maynard, Miss Joan

      Buchanan, Richard

      Gourlay, Harry

      Mellish, Rt Hon Robert

      Butler, Mrs Joyce (Wood Green)

      Graham, Ted

      Millan, Rt Hon Bruce

      Callaghan, Rt Hon J. (Cardiff SE)

      Grant, George (Morpeth)

      Miller, Dr M. S. (E Kilbride)

      Callaghan, Jim (Middleton & P)

      Grant, John (Islington C)

      Mitchell, Austin

      Campbell, Ian

      Grocott, Bruce

      Molloy, William

      Canavan, Dennis

      Hamilton, W. W. (Central Fife)

      Morris, Alfred (Wythenshawe)

      Cant, R. B.

      Hardy, Peter

      Morris, Rt Hon Charles R.

      Carmichael, Neil

      Harrison, Rt Hon Walter

      Morris, Rt Hon J. (Aberavon)

      Carter, Ray

      Hart, Rt Hon Judith

      Moyle, Roland

      Cartwright, John

      Hattersley, Rt Hon Roy

      Mulley, Rt Hon Frederick

      Castle, Rt Hon Barbara

      Henderson, Douglas

      Murray, Rt Hon Ronald King

      Clemitson, Ivor

      Hooley, Frank

      Newens, Stanley

      Cocks, Rt Hon Michael (Bristol S)

      Hooson, Emlyn

      Noble, Mike

      Cohen, Stanley

      Horam, John

      Oakes, Gordon

      Coleman, Donald

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

      Orme, Rt Hon Stanley

      Cook, Robin F. (Edin C)

      Howells, Geraint (Cardigan)

      Owen, Rt Hon Dr David

      Corbett, Robin

      Hoyle, Doug (Nelson)

      Padley, Walter

      Cox, Thomas (Tooting)

      Huckfield, Les

      Palmer, Arthur

      Craigen, Jim (Maryhill)

      Hughes, Rt Hon C. (Anglesey)

      Park, George

      Crawford, Douglas

      Hughes, Robert (Aberdeen N)

      Parker, John

      Crawshaw, Richard

      Hughes, Roy (Newport)

      Parry, Robert

      Cronin, John

      Hunter, Adam

      Pendry, Tom

      Crowther, Stan (Rotherham)

      Irvine, Rt Hon Sir A. (Edge Hill)

      Penhaligon, David

      Cryer, Bob

      Irving, Rt Hon S. (Dartford)

      Perry, Ernest

      Cunningham, Dr J. (Whiteh)

      Jackson, Colin (Brighouse)

      Price, William (Rugby)

      Davidson, Arthur

      Jackson, Miss Margaret (Lincoln)

      Rees, Rt Hon Merlyn (Leeds S)

      Davies, Bryan (Enfield N)

      Janner, Greville

      Reid, George

      Davies, Rt Hon Denzil

      Jay, Rt Hon Douglas

      Roberts, Albert (Normanton)

      Davies, Ifor (Gower)

      Jenkins, Hugh (Putney)

      Roberts, Gwilym (Cannock)

      Davis, Clinton (Hackney C)

      John, Brynmor

      Robinson, Geoffrey

      Deakins, Eric

      Johnson, Walter (Derby S)

      Roderick, Caerwyn

      Dean, Joseph (Leeds West)

      Jones, Alec (Rhondda)

      Rodgers, George (Chorley)

      Dempsey, James

      Jones, Barry (East Flint)

      Rodgers, Rt Hon William (Stockton)

      Doig, Peter

      Judd, Frank

      Rooker, J. W.

      Dormand, J. D.

      Kerr, Russell

      Roper, John

      Douglas-Mann, Bruce

      Kilroy-Silk, Robert

      Rose, Paul B.

      368

      369

      Ross, Stephen (Isle of Wight)

      Stoddart, David

      Wellbeloved, James

      Ross, Rt Hon W. (Kilmarnock)

      Strang, Gavin

      Welsh, Andrew

      Rowlands, Ted

      Summerskill, Hon Dr Shirley

      White, Frank R. (Bury)

      Sandelson, Neville

      Swain, Thomas

      White, James (Pollok)

      Sedgemore, Brian

      Taylor, Mrs Ann (Bolton W)

      Whitlock, William

      Sever, John

      Thomas, Dafydd (Merioneth)

      Wigley, Dafydd

      Shaw, Arnold (Ilford South)

      Thomas, Jeffrey (Abertillery)

      Willey, Rt Hon Frederick

      Sheldon, Rt Hon Robert

      Thomas, Mike (Newcastle E)

      Williams, Alan Lee (Hornch'ch)

      Shore, Rt Hon Peter

      Thomas, Ron (Bristol NW)

      Wilson, Gordon (Dundee E)

      Short, Mrs Renée (Wolv NE)

      Thompson, George

      Wilson, Rt Hon Sir Harold (Huyton)

      Silkin, Rt Hon John (Deptford)

      Thorne, Stan (Preston South)

      Wilson, William (Coventry SE)

      Silkin, Rt Hon S. C. (Dulwich)

      Tinn, James

      Wise, Mrs Audrey

      Silverman, Julius

      Tomlinson, John

      Woodall, Alec

      Skinner, Dennis

      Torney, Tom

      Woof, Robert

      Smith, John (N Lanarkshire)

      Tilley, John (Lambeth, Central)

      Wrigglesworth, Ian

      Snape, Peter

      Wainwright, Edwin (Dearne V)

      Young, David (Bolton E)

      Spearing, Nigel

      Walker, Terry (Kingswood)

      Spriggs, Leslie

      Watkins, David

      TELLERS FOR THE NOES:

      Stallard, A. W.

      Watt, Hamish

      Mr. Joseph Harper and

      Stewart, Rt Hon Donald

      Weitzman, David

      Mr. James Hamilton.

      Stewart, Rt Hon M. (Fulham)

      Question accordingly negatived.

    New Clause No. 6

      AUDIT OF WELSH COMPTROLLER AND AUDITOR GENERAL
      'In relation to any accounts examined by the Welsh Comptroller and Auditor General in accordance with the provisions of section 52 of this Act, section 161 of the Local Government Act 1972 shall apply as if—

      (a) such examinations were an audit of accounts under Part VIII of the Local Government Act 1972;

      (b)the Welsh Comptroller and Auditor General were a district auditor;

      (c)members of the Assembly were members of a local authority;

      (d)any reference in the said section 161 to a person being disqualified for being a member of a local authority were a reference to that person being disqualified for being a member of the Assembly; and

      (e) subsection (13) of the said section 161 provided as follows:—

      "(13) The Court having jurisdiction for the purpose of this section shall be the High Court."'.)—[Mr. Brittan]
      Brought up, and read the First time.
      Mr. Brittan: I beg to move, That the clause be read a Second time.
      The new clause is designed to provide an effective mechanism to deal with the situation in which the Welsh Assembly exceeds its powers. There is already in the Bill provision for the courts to determine whether and when that has happened, but there is no adequate provision to enforce a court order if it has happened. The clause seeks to adapt the provisions contained in the Local Government Act 1972 and to provide sanctions for use in such a situation. I stress at the outset that, in seeking to move the new clause and to provide sanctions on those lines, we are not in any way suggesting that it is likely to be a frequent occurrence for the Welsh Assembly to act unlawfully or for this sanction to be required to be used.
      None the less, in our view there is a gap that should be filled in important constitutional legislation of this kind. It is unsatisfactory that there should be limitations on the powers of the Welsh Assembly and that there should be machinery for determining whether those limitations have been exceeded but that there should be no means of securing that the limitations do not continue to be
      372
      exceeded once it has been decided that they have been exceeded.
      Clause 70 enables the Attorney-General to institute, and the Assembly to defend, proceedings for the determination of any question whether anything done or proposed to be done by the Assembly is within its powers. The House will recall that when we debated that provision it was suggested from the Conservative Benches that it would be necessary to supplement that provision and to ensure that not only the Attorney-General but an ordinary individual who had the appropriate standing should be able to bring such proceedings and to ensure that proceedings could be brought not only to see whether anything had been done or proposed to be done in excess of the Assembly's powers but to make sure that the Assembly carried out its duties.
      The one aspect of the amendment which was moved from this side of the Committee on that occasion which was not acceptable to the Government, in the person of the Attorney-General, was the suggestion that the court should be entitled to make any sort of order requiring the Assembly to do or not to do something if it was found to have exceeded its powers or to be contemplating exceeding its powers. The Court would be the High Court in England and Wales, according to where it was sitting.
      I found it difficult to be persuaded by the arguments of the Attorney-General as to why that was an inappropriate procedure. On considering the matter, we decided that the appropriate remedy might be that, instead of permitting a court to make an order that would be difficult to enforce against the Assembly, a borrowing should be made from the Local Government Act 1972 to provide a sanction by means of the powers of the district auditor and the court so that the Members of the Assembly would suffer in appropriate circumstances, which, I stress, would be rare, the sanctions that members of local authorities suffer if they wilfully exceed their powers.
      Of course, this is a severe measure if interpreted literally and if all the powers were exercised to the full, but the provisions of Section 161 of the Local Government Act, which the new clause suggests should be applicable to the Assembly, are discretionary and provide

      373
      a wide measure of defences which would prevent their being exercised in an unreasonable way or in circumstances in which they were inappropriate.
      It is appropriate to apply this sanction to the Assembly because it is, perhaps, the only effective sanction to deal with a situation in which the Assembly fails to carry out a duty or exceeds its powers.
      I concede to the Attorney-General that if a court were empowered to make an order requiring the Assembly to do, or to desist from doing, something and the Assembly refused to carry out the order, there is little that the court could do in the face of such resistance. That would clearly be a most unsatisfactory situation.
      I hasten to add that I am not expecting that such a situation will arise, and the inclusion of provisions to deal with it should not be regarded as a reflection on the Assembly or an indication that it is likely to occur. However, it would be incomplete to fail to provide an appropriate way of dealing with such a situation.
      We have therefore suggested an adaptation of the procedure in the Local Government Act, particularly in Section 161, which provides that
      "Where the audit of any accounts under this Part of this Act is carried out by a district auditor and it appears to him that any item of account is contrary to law he may apply to the court for a declaration that the item is contrary to law except where it is sanctioned by the Secretary of State."
      I stress that this applies only if the district auditor believes that the item on which money has been spent is contrary to law. There is the further protection that it is not open to the district auditor to take action of his own. He has to apply to the court. In addition, he is not obliged to apply to the court. It is a permissive provision which says that he may apply to the court for the appropriate declaration.
      Section 161(2) of the Local Government Act states:
      "On an application under subsection (1) above the court may make or refuse to make the declaration asked for".
      It is clear that the court has a discretion, which it will not hesitate to use, against making a declaration if it believes that it is inappropriate to do so. Where the
      374
      makes such a declaration, it may also order that
      "any person responsible for incurring or authorising any expenditure declared unlawful shall repay it in whole or in part to the body in question and, where two or more persons are found to be responsible, that they shall be jointly and severally liable to repay it as aforesaid".
      The court may do that, but it is not obliged to do it, even if it finds that what has been done is contrary to law. It may also decide—but it is not obliged to do so—if any such ependiture exceeds £2,000 and the person responsible for incurring or authorising it is a member of a local authority, to order him to be disqualified from being a member of a local authority for a specified period.
      10.15 p.m.
      When considering the possibility of these penalties—namely, repayment of money and disqualification—it is crucial to take on board the implications of subsection (3) of Section 161, which lays down important limitations. That subsection provides that
      "The court shall not make an order … if the court is satisfied that the person responsible for incurring or authorising any such expenditure acted reasonably or in the belief that the expenditure was authorised by law".
      That makes it clear that either of those situations provides a defence and disentitles the court from making an order. That means that if the person concerned thought that the expenditure was lawful there can be no surcharge or disqualification. Even if that person did not think that the expenditure was lawful and he acted reasonably, there can be no surcharge or disqualification.
      These penalties can arise only if the district auditor has considered the matter and come to the conclusion that it is appropriate to ask for an order, if the court comes to the same conclusion and if the defences are not available.
      The further provision is that in any other case, if the court comes to the conclusion that the person has not acted reasonably or has not acted in the belief that the expenditure was authorised by law, it
      "shall have regard to all the circumstances, including that person's means and ability to repay that expenditure or any part of it."
      I shall not analyse the remainder of Section 161, which deals with other wilful

      375
      defaults and provides a mechanism for an aggrieved individual to raise the issue.
      I hope that I have illustrated the general nature of the power. We are operating under a time limit. The power is discretionary and is hedged in with all types of protections. The effect of it is that there is no risk of its being exercised in a draconian or unfair way. It can be exercised only if there has been a flagrant breach of the law.
      In the new clause those provisions are adapted to the Welsh Assembly so that the audit of accounts referred to in the Local Government Act applies in such a way that the examination provided for by the Welsh Comptroller and Auditor General under Clause 52 is treated in the same way. The Welsh Comptroller and Auditor General is treated as if he were a district auditor and the Members of the Assembly are treated as if they were members of a local authority.
      The important transformation of the provisions ensures that even when small sums are involved the powers can be exercised only by the High Court and not, as with local government, by the county courts.
      We are seeking to provide a means of ensuring that, in the rare case of the Assembly failing to act according to the law and refusing to comply with it, there shall in the last resort be a means of taking the only action that would have any effect on the Members who wilfully act against the law—that is, surcharge and disqualification.
      The only argument that I can think of—I dare say that the Minister will think of others—that could be raised against the provision of such powers is that in this respect it is in some sense inappropriate to treat the Assembly as if it were a local authority. Here again, as in so many cases, we come to one of the central features of the debates on the Bill—namely, that in some respects the Government wish the Assembly to be treated as a local authority and in other respects they shy away from that.
      All that I can say is that, without seeking to anticipate arguments that may be put forward on this point, it is not sufficient to say that the Assembly is not the same as a local authority and ought not for these purposes to be treated as a local authority Those who seek to make
      376
      that case must explain what the difference is that makes it inappropriate that the Assembly should be treated as a local authority in this respect. For my part, I can think of none.
      It is not in any sense an affront to the dignity of the Assembly, because I would have hoped that local authorities were bodies which the House would wish to regard and treat as bodies of considerable authority and dignity. It is not meant in that sense as in any way a denigration.
      It remains the fact that without provisions of this kind, and with the Attorney-General resisting our amendment to Clause 70, in the rare but not impossible case of the Assembly refusing to obey the law this House would be powerless. That is a situation which we do not think should remain. It is not a state in which the Bill ought to leave this House, if it leaves it at all. It is for that reason that I move the new clause.
      Mr. Dalyell: I should like first to ask a direct question of my hon. Friend the Under-Secretary which was not cleared up in the previous context. In relation to the Welsh Development Agency, will the audit be done by the Comptroller and Auditor-General for the United Kingdom or by the Welsh Comptroller and Auditor General? This is not a pernickety point. It is a point of some substance and importance. If my hon. Friend does not know the answer from the top of his head, I should be grateful if he would get an answer from the Box, because this subject raises the whole question of the authority and economic powers of the Assembly.
      Secondly—and here I speak with some diffidence because I am not a lawyer, but with the exception of yourself, Mr. Speaker, and the Minister, being the only Welsh Lebaur Members present, perhaps I speak for the unanimous opinion of the Labour Back Benches yet again—I draw my hon. Friend's attention to the issue of the High Court. As I say, I speak with some diffidence, but with rather less diffidence having studied the speeches of the Law Lords in another place. I quote part of the speech made on 18th April by Lord Wilberforce. I admit that there are differences that we have gone over endlessly between the Scotland Bill and the Wales Bill, but I think that this applies to the situation that we are discussing.

      377
      The noble Lord said:
      "First, they are very complicated and technical "—
      those are the decisions—
      "and require for their decision an expert body, inevitably of lawyers, and preferably an expert body of a permanent character. Secondly, since they are likely to give rise to friction between Scotland and the rest of the United Kingdom"—
      and for Scotland one could read "Wales" here—
      "The decision must be in the hands of a body which has the confidence of both the citizens of Scotland and the citizens of the rest of the United Kingdom. Thirdly and most important, the questions which have to be decided are questions of a constitutional character such as in Europe would come before a so-called constitutional court, in Canada, Australia and the United States would come before a body set up to decide constitutional questions, and the system of law by which they are to be judged and decided I should think would be unquestionably constitutional law."
      I do not want to go on with this argument but wish to turn briefly to the arguments of Lord Scarman, who said:
      "Why not have the courage to say that this calls for a new constitutional bottle, a new constitutional judicial body? We shall begin by calling it a Council. That is the British way of concealing the truth behind euphemistic terms like, for instance, the term 'devolution'. That is one very nice way of doing it. But sooner or later we are coming to a court as, perhaps sooner rather than later, we are coming to a federation."—[Official Report, House of Lords, 18th April 1978; Vol. 390, cc 1089, 1112–13.]
      I agree that there were differences of opinion, that Lord Morris and Lord Dip-lock took somewhat different views in another context, but when the heavy-weight Law Lords of this country express such deep dissatisfaction, what is the Government's answer to the question of whether the High Court is a suitable place to resolve these matters?
      It is late and I have truncated my speech. I let it rest on that question, but I hope that it gets an answer.
      Mr. A. P. Costain: As an English Member one hesitates to take part in a Welsh debate, but as a member of the Public Accounts Committee I am particularly interested in the new clause—especially since today we have had the extraordinary experience of the chairman of the National Enterprise Board expressing doubt whether the Comptroller and Auditor General
      378
      has the right to reveiw the NEB's accounts.
      Therefore, is my hon. and learned Friend the Member for Cleveland and Whitby (Mr. Brittan) satisfied about the relationship under this new clause between the Comptroller and Auditor General of the United Kingdom and the holder of the Welsh Office? Will the Welsh one be above or below the United Kingdom one? How will accounts be considered between the two?
      We are giving the Comptroller and Auditor General the powers of the district auditor, which basically involve more power to deal with the individual than the Comptroller and Auditor General has. Although in theory the latter has the power to surcharge an accounting officer, he has never done so, at least during this century. The same cannot be said of the district auditor.
      Therefore, can these additional powers be enforced in reality. In practice, few accounting officers in this century or the last could afford to pay the surcharge which could be applied to them under the possible sanctions. Therefore we need to know whether the powers in the new clause, which I support, are practicable and whether they can be enforced in the ordinary course of parliamentary business.
      If we refer to the law as having been broken will we be referring to Common Market regulations, the law of this Parliament or the law of the Welsh Assembly? Which would have priority? Answers to these questions would be helpful.
      Sir David Renton: The points made by my hon. and learned Friend the Member for Cleveland and Whitby (Mr. Brittan) deserve very careful attention. We are in a strange position, because we are brought into the realm of the twilight. The Welsh Assembly is neither a local authority, with the statutory disciplines that Parliament imposes upon a local authority, nor a Secretary of State with answerability to this House.
      The Government have done their best in almost impossible circumstances to create something to shed a little light upon that twilight area by inventing and—if the Bill ever by misfortune becomes law—appointing the Welsh Comptroller and Auditor General. But, in order that be may know how he is to exercise his

      379
      functions, it is essential that he should be given some kind of guidance.
      10.30 p.m.
      My hon. and learned Friend, in putting forward the new clause, had to adopt an unusual and rather difficult drafting contrivance in order that the position to which he has drawn attention could be brought into statutory form. Not everybody would agree that the provisions of a statute should be held to apply to another statute merely "as if". The purists in matters of drafting would indeed have a good deal to complain about in some circumstances if that were done. But in the circumstances with which we are faced this is one of the exceptions when a contrivance of the kind proposed is justified.
      Although this is a twilight area, the analogy with the way in which the district auditor performs his duties in relation to local authorities could well be thought accurately to apply to the Welsh Comptroller and Auditor General when he is auditing the accounts of the Welsh Assembly. Therefore, there is a justification for paragraphs (a) and (b) of the clause, and it follows of necessity that, whether they like it or not, the Members of the Assembly would have to be treated for the purposes of the audit as though they were members of a local authority.
      If I may say so in passing, I trust without going out of order, I think that the Members will be somewhat over-alert to usurp the functions of local authorities. The temptations will be great. At any rate, for the purpose of the audit I think it is perfectly fair that they should be treated as though they were members of a local authority.
      One hates in Parliament to have to assume that people might not come up to scratch, but it has been known for members of local authorities to incur disqualification through one misfeasance or another, and so, alas, we must have paragraph (d) in the new clause. It says:
      "any reference in the said section 161",
      which I need not repeat, because my hon. and learned Friend has already described it,
      "to a person being disqualified for being a member of a local authority were a reference to that person being disqualified for being a member of the Assembly".
      Mr. Dalyell: The right hon. and learned Gentleman will recall that he was a member of the Kilbrandon Commission, which had a great deal to say on the subject of how the Assemblies, if they were to come into being, were not to be treated as and not to be aligned with local authorities. Is not this a bit different?
      Sir D. Renton: The hon. Member for West Lothian (Mr. Dalyell) has underlined a matter which is very much in the minds of every Member of the House, I should have thought, because it is an ambivalent situation. There is no doubt whatever about that. I have already referred to the temptation that there will be on the part of some Assembly Members—one would hope not the majority, but it might sometimes be the majority—to usurp the functions of local authorities in a state of almost subconscious empire building.
      Mr. Dalyell: What the heck are they to do if they do not usurp the work of the local authorities? Here we are with an Assembly, which apparently is to sit 37 weeks in the year, without all these powers. Unless it meddles in local authority matters, it will be twiddling its proverbial thumbs.
      Sir D. Renton: I think that there is a very grave danger of that. The hon. Gentleman is perhaps politically even more courageous than I for many years have tried to be. I am very grateful to him for pointing that out.
      Mr. Dalyell: Not politically courageous but politically wise, as the election results in Scotland yesterday seem to show.
      Sir D. Renton: I am not a Scottish Member, although I have some Scottish ancestry. But, as the hon. Gentleman, who is a Scottish Member—and who is paying very close attention indeed, I have no doubt, to the results of the elections in Scotland—has pointed out, there is a lesson to be learnt in relation to the Principality of Wales.
      I do not propose, just for the moment—if I may give notice of this, Mr. Speaker—to yield any further to the hon. Gentleman, if he should wish me to give way, because I have other things, perhaps more pertinent to the new clause which I feel obliged to say. My next point, in

      381
      fact, follows up the speech of the hon. Gentleman, and I hope that he will not ask me to give way yet again. He said, in relation to sub-paragraph (e) of the new clause—I must call it that because it is not a subsection—that in another place eminent Law Lords had suggested that any question of interpretation that arises under these devolution Bills should be decided by a new kind of court, a constitutional court.
      I have the misfortune, Mr. Speaker, to disagree with those great Law Lords. I consider that those members of my profession who have reached the High Court bench after years of arduous toil at the Bar, and generally with very varied practices, are in as good a position, once they reach the High Court bench—and perhaps the Court of Appeal, and eventually the House of Lords—to decide on questions of interpretation of Acts of Parliament as the Members of any more specialised court would be.
      Moreover, I think that if we were to establish a more specialised court we should have to face up to the fact that the judges upon it would have had the same sort of experience as High Court judges would have had before reaching the bench but that once they were members of that specialised court they would have the disadvantage, which High Court judges do not suffer, of having to confine themselves to constitutional matters and the interpretation of the administrative provisions of statutes, as happens on the Continent.
      I do not think that that is a good evolution of our judicial tradition. I think that it is better that we should fasten upon the High Court in Scotland and in England and Wales the responsibility of determining all statutes which Parliament gives them the opportunity of interpreting. Sometimes, of course, Parliament deprives them of that opportunity. But, rather than creating separate courts, the new clause is right in saying that
      "The Court having jurisdiction for the purpose of this section shall be the High Court."
      To that extent I disagree with those eminent Law Lords. However, it is a good thing that the hon. Member for West Lothian drew attention to what they had said. I hope that we shall not give too much encouragement to it.
      382
      Having said that, I feel that the Opposition Front Bench is right to have moved the new clause, both for the removal of doubt and for the inherent advantages which it would confer if by some misfortune the Welsh Assembly ever came into existence.
      The Under-Secretary of State for Wales (Mr. Barry Jones): I have listened with interest to the clever and ingenious case that the hon. and learned Member for Cleveland and Whitby (Mr. Brittan) made to promote the new clause. I have heard the interesting and complex contributions from hon. Members on both sides of the House. As ever, I shall reply briefly, bluntly and most simply. I frequently find myself at the Dispatch Box at a late hour answering complex new clauses on legal matters.
      For the information of the House, I should say that the Welsh Assembly will be exercising central Government functions. We feel that arrangements for the audit of its accounts should be based on those presently in operation for Government accounts. That is why we have Clause 49 of the Bill, which creates the Welsh Comptroller and Auditor General. Clause 59 provides for access by him to the Assembly's books and other papers. It is Clause 52 which provides for him to audit the Assembly's accounts. In Clause 53 there is the provision for the Welsh Comptroller and Auditor General's report to be laid before the Assembly and for the Assembly's Accounts Committee to scrutinise the report and itself to report to the Assembly. In Clause 54 there is the very important provision for publication of the accounts as well as the reports of the Welsh Comptroller and Auditor General and the Accounts Committee. It is as well to inform the House again of those provisions, because they are very important.
      I should like to assure hon. Members who have posed their questions that these procedures are adapted from the long-established and well-tried system whereby the Government are accountable to Parliament for their expenditure.
      In one sense the position of the Welsh Assembly will be different, in that there is no separate Executive. But the Bill provides for a separate Executive Committee and an Accounts Committee. I want to reassure the House that financial

      383
      initiatives may be made only on the recommendation of the Executive Committee. It is the Executive Committee which prepares the accounts of payments in and out of the Welsh consolidated and loans funds. I think that these are important points to make because, clearly, hon. Members have doubts and seek information, and I wish to give the background so that they get a better understanding of why the Government's case is that the new clause should be rejected.
      10.45 p.m.
      The Accounts Committee may include only one member of the Executive Committee and will reflect the party balance in the Assembly. It is an important provision that all political parties in the Assembly should be represented on that very important committee. The Accounts Committee, which will be very important, will be the Assembly's watchdog over the way the block grant is spent, and it can be counted upon to bring any irregularity to the notice of both the Assembly and the public.
      The Executive Committee, or the individuals on it, will have to face all the resulting political pressures and justify its behaviour to the Assembly. It is fair to say that these pressures are not to be taken lightly, because the Assembly will be directly elected; it will be a directly elected political institution.
      The Government regard it as important that the arrangements for accounts and audit should operate in a way that encourages the development of a powerful Back Bench watchdog on the lines of the Westminster Public Accounts Committee. I hope that the House will accept that in the Assembly there will be every conceivable safeguard with regard to some of the doubts that hon. Members are raising.
      Sir David Renton: It would help the House a great deal and clarify the whole situation if the hon. Gentleman could tell us to whom the Welsh Comptroller and Auditor General will be answerable. Obviously he cannot be answerable to the Assembly because he is to be its watchdog.
      Mr. Jones: I think that the immediate and speedy answer I would wish to give is that as long as the Comptroller and
      384
      Auditor General is doing his job properly and is ascertaining that things are being run well, that is the basic assurance that the right hon. and learned Gentleman would seek to have from me at this time of the day in this important debate.
      Mr. W. Benyon: Surely local government committees, which are directly elected and which are all-party, still act ultra vires. Why should not the same situation apply in this case?
      Mr. Jones: There is every certainty in my mind, as there was when I gave my previous reply to the right hon. and learned Member for Huntingdonshire (Sir D. Renton), that the Comptroller and Auditor General will be responsible to the Welsh Assembly. I note the disappointment of Opposition Members. They would like to have a less clear answer at this time of night, but they will have to be satisfied with the correct answer that I am giving, which I am stating in as courteous a tone as possible to the right hon. and learned Gentleman.
      Mr. Brittan: The objection is not to the courtesy but to the lack of relevancy. If a local authority can be subject to surcharge if its members wilfully and deliberately act contrary to the law—a local authority which is an elected body responsible to its electorate—why should not the Welsh Assembly be subject to the same procedure?
      Mr. Jones: The Assembly is not a local authority, but I hope that I can come in a little more detail and in a little more time to the point made by the hon. and learned Gentleman.
      Before I was interrupted, I was about to say that I did not think that these pressures should be taken lightly in a directly elected political institution. It is important that the arrangements for accounts and audit should operate in a way that encourages the development of this powerful Back Bench watchdog committee, on the lines of the Westminster Public Accounts Committee. The Government wish, and in many ways expect, to see an Assembly is confident, which is mature and which will be responsible in handling such matters as we are debating tonight.
      I now wish to say something about the new clause. I noticed that in the ingenious way in which the hon. and

      385
      learned Member for Cleveland and Whitby proposed the new clause he said that he does not wish the powers that it provides to be exercised to the full. He wants discretion to be applied. He does not want the powers in the new clause to be exercised inappropriately and unreasonably. The hon. and learned Gentleman implied that he and his hon. Friends think that there is a gap and that the new clause is the solution to that, but I think that to a degree he undermined his argument by saying "Do not place too much relevance on the new clause. In fact, do not use all the powers that we are proposing."
      Mr. Brittan: That is not what was said. Nothing of that kind was said. I said that by adopting the procedure of the 1972 Local Government Act the new clause adopted a procedure that was not a blunderbuss automatically applied whenever there was an accidental breach of the law but was a careful instrument, with an abundance of safeguards, to ensure that the drastic powers of surcharge and disqualification were used only in the case of a flagrant breach. What the Minister has said is a misrepresentation of what the new clause says and what I said in support of it.
      Mr. Jones: I think not. I stand by what I said. Perhaps I have stung the hon. and learned Gentleman a little by quoting directly in part what he said. I said that he does not want to exercise the powers in the new clause to the full. He wants discretion to be exercised. By saying those things, he is to a degree drawing back from the solution that he proposes in the new clause. At this late hour I do not propose to dally overlong on the complexity of some of the points that the hon. and learned Gentleman put forward from the Opposition Front Bench.
      I was about to say that such an attitude can hardly be expected to be encouraged by the new clause, because it seems to me that its purpose is to treat the Assembly as a local authority. I think that to seize on the aspects of local government audit which deal with irregularities shows a misplaced mistrust of the Assembly and of the integrity of the Members whom the Welsh people will choose to represent them. The hon. and learned Gentleman somewhat slid over
      386
      that aspect of the matter. He was slightly shamefaced in the manner in which he made his points.
      The procedures under Section 161 of the 1972 Act are entirely unsuitable for a central Government institution. If the Assembly is to be a flourishing and responsible political body—and it will be, notwithstanding the disagreement of the hon. Member for Pembroke (Mr. Edwards)—it is far better for it to devise its own way of dealing with any irregularities that are uncovered by the Welsh Comptroller and Auditor General and the Accounts Committee.
      Mr. Costain: Will the Minister have the courtesy to reply to the points that I made in the debate? How does the Comptroller and Welsh Auditor General stand in relation to the British Comptroller and Auditor General, and why is the Welsh Assembly given more power than this Parliament to sack the Comptroller and Auditor General?
      Mr. Jones: I listened with great care to the hon. Member's remarks. I think that he has raised a number of false points. He was rather mistakenly referring to the EEC. I would have thought that he would have been pleased, just as I am, that the Comptroller and Auditor General for Wales has substantial powers. Perhaps he is envious that such a situation will exist in the Welsh Assembly.
      Before time runs out, I want to deal with the complex points raised by my hon. Friend the Member for West Lothian (Mr. Dalyell) and the right hon. and learned Member for Huntingdonshire with regard to the Law Lords. None of the arguments apply in Wales. The powers to be exercised by the Assembly are set out in the Bill, and there can be little or no room—[Hon. Members: "Oh."] Even at this late hour, Conservative Members should pay attention to the answers that the Government are giving to the important points raised in this brief debate.
      Mr. D. E. Thomas: Will the Minister reflect that the attitude of the Conservative Opposition throughout the Bill has been to impede progress, with destructive amendments? Now that we are debating the essential issue of control of public expenditure in the Assembly, they are indulging in hysterics rather than listening to the Minister's response.
      Sir Raymond Gower: In view of the very serious constitutional significance of the fact that only new clauses have been dealt with and not a single amendment has been reached, is it not an appalling situation to suggest that we should have discussed amendments when they have not been reached? The Government, even now, should relent and give us extra time.
      Mr. Jones: The attitude of the official Opposition leaves a lot to be desired, particularly when one is attempting to give as good a reply as one can at this late hour.
      The powers to be exercised by the Assembly in Wales are set out in the Bill, and there can be little or no room for argument whether a particular power is exercisable by the Secretary of State or the Assembly.
      My hon. Friend the Member for West Lothian, in another of his pertinacious interventions, mentioned the funding of the Welsh Development Agency. The funding of the Agency will be from the block fund—
      Mr. Pym: On a point of order, Mr. Speaker. Since many of us feel that the Minister's reply, if such it can be called, is nothing less than an insult to Parliament, with 30 seconds to go I wish to move, That the Question be now put.
      It being Eleven o'clock, Mr. SPEAKER proceeded, pursuant to the Order [16 th November] and the Resolution this day, to put forthwith the Question already proposed from the Chair.
      Question put, That the clause be read a Second time:—
      The House divided: Ayes 228, Noes 252.

      Division No. 198]

      AYES

      [11.0 p.m.

      Adley Robert

      Crouch, David

      Hicks, Robert

      Aitken, Jonathan

      Crowder F. P.

      Higgins, Terence L.

      Alison, Michael

      Davies, Rt Hon J. (Knutsford)

      Hodgson, Robin

      Amery, Rt Hon Julian

      Dean, Paul (N Somerset)

      Holland, Philip

      Arnold, Tom

      Dodsworth, Geoffrey

      Hordern, Peter

      Atkins, Rt Hon H. (Spelthorne)

      Douglas-Hamilton, Lord James

      Hunt, David (Wirral)

      Atkinson, David (Bournemouth, East)

      Drayson, Burnaby

      Hunt, John (Ravensbourne)

      Awdry, Daniel

      du Cann, Rt Hon Edward

      Hurd, Douglas

      Baker, Kenneth

      Dunlop, John

      Hutchison, Michael Clark

      Banks, Robert

      Dykes, Hugh

      Hamilton, Archibald (Epsom & Ewell)

      Bell, Ronald

      Edwards, Nicholas (Pembroke)

      Irving, Charles (Cheltenham)

      Bendall, Vivian (Ilford North)

      Emery, Peter

      James, David

      Bennett, Sir Frederic (Torbay)

      Eyre, Reginald

      Jessel, Toby

      Bennett, Dr Reginald (Fareham)

      Fairbairn, Nicholas

      Johnson Smith, G. (E Grinstead)

      Benyon, W.

      Fairgrieve, Russell

      Joseph, Rt Hon Sir Keith

      Berry, Hon Anthony

      Farr, John

      Kaberry, Sir Donald

      Biffen, John

      Fell, Anthony

      Kimball, Marcus

      Biggs-Davison, John

      Finsberg, Geoffrey

      King, Tom (Bridgwater)

      Blaker, Peter

      Fisher, Sir Nigel

      Knox, David

      Body, Richard

      Fletcher, Alex (Edinburgh N)

      Lamont, Norman

      Boscawen, Hon Robert

      Fookes, Miss Janet

      Latham, Michael (Melton)

      Bottomley, Peter

      Forman, Nigel

      Lawrence, Ivan

      Bowden, A. (Brighton, Kemptown)

      Fowler, Norman (Sutton C'f'd)

      Lawson, Nigel

      Boyson, Dr Rhodes (Brent)

      Fox, Marcus

      Le Marchant, Spencer

      Braine, Sir Bernard

      Fraser, Rt Hon H. (Stafford & St)

      Lester, Jim (Beeston)

      Brittan, Leon

      Fry, Peter

      Lewis, Kenneth (Rutland)

      Brocklebank-Fowler, C.

      Galbraith, Hon T. G. D.

      Lloyd, Ian

      Brooke, Peter

      Gardiner, George (Reigate)

      Loveridge, John

      Brotherton, Michael

      Gardner, Edward (S Fylde)

      Luce, Richard

      Bryan, Sir Paul

      Gilmour, Sir John (East Fife)

      McAdden, Sir Stephen

      Buchanan-Smith, Alick

      Glyn, Dr Alan

      McCrindle, Robert

      Buck, Antony

      Goodhart, Philip

      Macfarlane, Neil

      Budgen, Nick

      Goodhew, Victor

      MacGregor, John

      Bulmer, Esmond

      Goodlad, Alastair

      MacKay, Andrew (Stechford)

      Burden, F. A.

      Gorst, John

      Macmillan, Rt Hon M. (Farnham)

      Butler, Adam (Bosworth)

      Gow, Ian (Eastbourne)

      McNair-Wilson, P. (New Forest)

      Carlisle, Mark

      Gower, Sir Raymond (Barry)

      Marshall, Michael (Arundel)

      Chalker, Mrs Lynda

      Grant, Anthony (Harrow C)

      Marten, Neil

      Channon, Paul

      Griffiths, Eldon

      Mates, Michael

      Churchill, W. S.

      Grist, Ian

      Mather, Carol

      Clark, Alan (Plymouth, Sutton)

      Hall-Davis, A. G. F.

      Maude, Angus

      Clarke, Kenneth (Rushcliffe)

      Hamilton, Michael (Salisbury)

      Mawby, Ray

      Clegg, Walter

      Hampson, Dr Keith

      Maxwell-Hyslop, Robin

      Cooke, Robert (Bristol W)

      Harrison, Col Sir Harwood (Eye)

      Mayhew, Patrick

      Cope, John

      Haselhurst, Alan

      Meyer, Sir Anthony

      Cormack, Patrick

      Havers, Rt Hon Sir Michael

      Miller, Hal (Bromsgrove)

      Costain, A. P.

      Hawkins, Paul

      Mills, Peter

      Critchley, Julian

      Hayhoe, Barney

      Miscampbell, Norman

      Moate, Roger

      Ridley, Hon Nicholas

      Stewart, Ian (Hitchin)

      Molyneaux, James

      Rifkind, Malcolm

      Stokes, John

      Monro, Hector

      Roberts, Michael (Cardiff NW)

      Stradling Thomas, J.

      Montgomery, Fergus

      Roberts, Wyn (Conway)

      Tapsell, Peter

      More, Jasper (Ludlow)

      Rodgers, Sir John (Sevenoaks)

      Taylor, R. (Croydon NW)

      Morgan, Geraint

      Ross, William (Londonderry)

      Taylor, Teddy (Cathcart)

      Morris, Michael (Northampton S)

      Rossi, Hugh (Hornsey)

      Tebbit, Norman

      Mudd, David

      Rost, Peter (SE Derbyshire)

      Temple-Morris, Peter

      Neave, Airey

      Royle, Sir Anthony

      Townsend, Cyril D.

      Neubert, Michael

      Sainsbury, Tim

      Trotter, Neville

      Newton, Tony

      St. John-Stevas, Norman

      van Straubenzee, W. R.

      Nott, John

      Scott, Nicholas

      Vaughan, Dr Gerard

      Onslow, Cranley

      Shaw, Giles (Pudsey)

      Viggers, Peter

      Page, John (Harrow West)

      Shelton, William (Streatham)

      Wakeham, John

      Page, Rt Hon R. Graham (Crosby)

      Shepherd, Colin

      Walder, David (Clitheroe)

      Page, Richard (Workington)

      Shersby, Michael

      Wall, Patrick

      Parkinson, Cecil

      Silvester, Fred

      Walters, Dennis

      Pattie, Geoffrey

      Sims, Roger

      Warren, Kenneth

      Percival, Ian

      Sinclair, Sir George

      Weatherill, Bernard

      Pink, R. Bonner

      Skeet, T. H. H.

      Wells, John

      Powell, Rt Hon J. Enoch

      Smith, Dudley (Warwick)

      Wiggin, Jerry

      Prentice, Rt Hon Reg

      Smith, Timothy John (Ashfield)

      Winterton, Nicholas

      Price, David (Eastleigh)

      Speed, Keith

      Wood, Rt Hon Richard

      Pym, Rt Hon Francis

      Spence, John

      Whitney, Raymond (Wycombe)

      Raison, Timothy

      Spicer, Michael (S Worcester)

      Younger, Hon George

      Rathbone, Tim

      Sproat, Iain

      Rees, Peter (Dover & Deal)

      Stanbrook, Ivor

      TELLERS FOR THE AYES:

      Renton, Rt Hon Sir D. (Hunts)

      Stanley, John

      Sir George Young and

      Renton, Tim (Mid-Sussex)

      Steen, Anthony (Wavertree)

      Mr. Peter Morrison.

      Rhodes, James R.

      NOES

      Allaun, Frank

      Davidson, Arthur

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

      Anderson, Donald

      Davies, Bryan (Enfield N)

      Howells, Geraint (Cardigan)

      Archer, Rt Hon Peter

      Davies, Rt Hon Denzil

      Hoyle, Doug (Nelson)

      Ashton, Joe

      Davies, Ifor (Gower)

      Huckfield, Les

      Atkins, Ronald (Preston N)

      Davis, Clinton (Hackney C)

      Hughes, Rt Hon C. (Anglesey)

      Bagier, Gordon A. T.

      Deakins, Eric

      Hughes, Robert (Aberdeen N)

      Bain, Mrs Margaret

      Dean, Joseph (Leeds West)

      Hughes, Roy (Newport)

      Barnett, Guy (Greenwich)

      Dell, Rt Hon Edmund

      Hunter, Adam

      Barnett, Rt Hon Joel (Heywood)

      Dempsey, James

      Irving, Rt Hon S. (Dartford)

      Bates, Alf

      Dewar, Donald

      Jackson, Colin (Brighouse)

      Bean, R. E.

      Doig, Peter

      Jackson, Miss Margaret (Lincoln)

      Beith, A. J.

      Dormand, J. D.

      Janner, Greville

      Benn, Rt Hon Anthony Wedgwood

      Douglas-Mann, Bruce

      Jay, Rt Hon Douglas

      Bennett, Andrew (Stockport N)

      Duffy, A. E. P.

      Jenkins, Hugh (Putney)

      Bidwell, Sydney

      Eadle, Alex

      John, Brynmor

      Bishop, Rt Hon Edward

      Edge, Geoff

      Johnson, James (Hull West)

      Blenkinsop, Arthur

      Ellis, John (Brigg & Scun)

      Johnson, Walter (Derby S)

      Boardman, H.

      English, Michael

      Jones, Alec (Rhondda)

      Booth, Rt Hon Albert

      Ennals, Rt Hon David

      Jones, Barry (East Flint)

      Boothroyd, Miss Betty

      Evans, Gwynfor (Carmarthen)

      Judd, Frank

      Bottomley, Rt Hon Arthur

      Evans, Ioan (Aberdare)

      Kilroy-Silk, Robert

      Boyden, James (Bish Auck)

      Evans, John (Newton)

      Lambie, David

      Bradley, Tom

      Ewing, Harry (Stirling)

      Lamond, James

      Bray, Dr Jeremy

      Faulds, Andrew

      Lestor, Miss Joan (Eton & Slough)

      Brown, Hugh D. (Provan)

      Flannery, Martin

      Lewis, Ron (Carlisle)

      Brown, Robert C. (Newcastle W)

      Fletcher, Ted (Darlington)

      Luard, Evan

      Buchan, Norman

      Foot, Rt Hon Michael

      Lyon, Alexander (York)

      Buchanan, Richard

      Forrester, John

      Lyons, Edward (Bradford W)

      Butler, Mrs Joyce (Wood Green)

      Fowler, Gerald (The Wrekin)

      Mabon, Rt Hon Dr J. Dickson

      Callaghan, Rt Hon J. (Cardiff SE)

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

      McCartney, Hugh

      Callaghan, Jim (Middleton & P)

      Freeson, Rt Hon Reginald

      MacCormick, Iain

      Campbell, Ian

      Freud, Clement

      McDonald, Dr Oonagh

      Canavan, Dennis

      Garrett, John (Norwich S)

      McElhone, Frank

      Cant, R. B.

      George, Bruce

      MacFarquhar, Roderick

      Carmichael, Neil

      Gilbert, Rt Hon Dr John

      MacKenzie, Rt Hon Gregor

      Carter, Ray

      Ginsburg, David

      Mackintosh, John P.

      Cartwright, John

      Golding, John

      Maclennan, Robert

      Castle, Rt Hon Barbara

      Gould, Bryan

      McMillan, Tom (Glasgow C)

      Clemitson, Ivor

      Gourlay, Harry

      McNamara, Kevin

      Cocks, Rt Hon Michael (Bristol S)

      Grant, George (Morpeth)

      Madden, Max

      Cohen, Stanley

      Grant, John (Islington C)

      Magee, Bryan

      Coleman, Donald

      Grocott, Bruce

      Mallalieu, J. P. W.

      Cook, Robin F. (Edin C)

      Hamilton, James (Bothwell)

      Marks, Kenneth

      Corbett, Robin

      Hardy, Peter

      Marshall, Dr Edmund (Goole)

      Cox, Thomas (Tooting)

      Harrison, Rt Hon Walter

      Marshall, Jim (Leicester S)

      Craigen, Jim (Maryhill)

      Hart, Rt Hon Judith

      Maynard, Miss Joan

      Crawford, Douglas

      Hattersley, Rt Hon Roy

      Meacher, Michael

      Crawshaw, Richard

      Hayman, Mrs Helene

      Mellish, Rt Hon Robert

      Cronin, John

      Henderson, Douglas

      Mendelson, John

      Crowther, Stan (Rotherham)

      Hooley, Frank

      Millan, Rt Hon Bruce

      Cryer, Bob

      Hooson, Emlyn

      Miller, Dr M. S. (E Kilbride)

      Cunningham, Dr J. (Whiteh)

      Horam John

      Mitchell, Austin

      Molloy, William

      Ross, Rt Hon W. (Kilmarnock)

      Tilley, John (Lambeth, Central)

      Morris, Alfred (Wythenshawe)

      Rowlands, Ted

      Tinn, James

      Morris, Charles R. (Openshaw)

      Ryman, John

      Tomlinson, John

      Morris, Rt Hon J. (Aberavon)

      Sandelson, Neville

      Torney, Tom

      Moyle, Roland

      Sedgemore, Brian

      Varley, Rt Hon Eric G.

      Mulley, Rt Hon Frederick

      Sever, John

      Wainwright, Edwin (Dearne V)

      Murray, Rt Hon Ronald King

      Shaw, Arnold (Ilford South)

      Walker, Terry (Kingswood)

      Newens, Stanley

      Sheldon, Rt Hon Robert

      Ward, Michael

      Noble, Mike

      Shore, Rt Hon Peter

      Watkins, David

      Oakes, Gordon

      Short, Mrs Renée (Wolv NE)

      Watt, Hamish

      O'Halloran, Michael

      Silkin, Rt Hon John (Deptford)

      Weitzman, David

      Orme, Rt Hon Stanley

      Silkin, Rt Hon S. C. (Dulwich)

      Wellbeloved, James

      Owen, Rt Hon Dr David

      Silverman, Julius

      Welsh, Andrew

      Padley, Walter

      Skinner, Dennis

      White, Frank R. (Bury)

      Palmer, Arthur

      Smith, John (N Lanarkshire)

      White, James (Pollock)

      Park, George

      Snape, Peter

      Whitlock, William

      Parry, Robert

      Spearing, Nigel

      Wigley, Dafydd

      Pavitt, Laurie

      Spriggs, Leslie

      Willey, Rt Hon Frederick

      Pendry, Tom

      Stallard, A. W.

      Willams, Rt Hon Alan (Swansea W)

      Penhaligon, David

      Stewart, Rt Hon Donald

      Williams, Alan Lee (Hornch'ch)

      Perry, Ernest

      Stewart, Rt Hon M. (Fulham)

      Williams, Rt Hon Shirley (Hertford)

      Price, William (Rugby)

      Stoddart, David

      Wilson, Gordon (Dundee E)

      Radice, Giles

      Strang, Gavin

      Wilson, Rt Hon Sir Harold (Huyton)

      Rees, Rt Hon Merlyn (Leeds S)

      Summerskill, Hon Dr Shirley

      Wilson, William (Coventry SE)

      Reid, George

      Swain, Thomas

      Wise, Mrs Audrey

      Roberts, Albert (Normanton)

      Taylor, Mrs Ann (Bolton W)

      Woodall, Alec

      Robinson, Geoffrey

      Thomas, Dafydd (Merioneth)

      Woof, Robert

      Roderick, Caerwyn

      Thomas, Jeffrey (Abertillery)

      Wrigglesworth, Ian

      Rodbers, George (Chorley)

      Thomas, Mike (Newcastle E)

      Young, David (Bolton E)

      Rodgers, Rt Hon William (Stockton)

      Thomas, Ron (Bristol NW)

      Rooker, J. W.

      Thompson, George

      TELLERS FOR THE NOES:

      Roper, John

      Thorne, Stan (Preston South)

      Mr. Joseph Harper and

      Rose, Paul B.

      Thorpe, Rt Hon Jeremy (N Devon)

      Mr. Ted Graham.

      Ross, Stephen (Isle of Wight)

      Question accordingly negatived.
      Mr. Speaker: Order. I am now required by the terms of the Allocation of Time Order to put the Question on any amendment moved by a member of the Government. The Government amendments standing on the Amendment Paper to which this applies are Amendments Nos. 7, 13 to 16, 18, 40, 45, 47, 49, 51, 53 to 58, 62, 67, 70, 74 to 81, and 99 to 107. If there is no objection, I propose to put the Questions en bloc.

    Clause 8

      JUDICIAL PROCEEDINGS AS TO DISQUALIFICATION
      Amendment made: No. 7, in page 5, line 40, at end insert—
      '; and the applicant shall give such security for the costs of the proceedings, not exceeding £200, as the court may direct.'.—[Mr. John South.]

    Clause 15

      STANDING ORDERS
      Amendments made: No. 13, in page 7, line 15, leave out 'may' and insert 'shall'.
      No. 14, in page 7, line 16, leave out 'including' and insert
      'and any standing order made by virtue of this subsection may include'.—[Mr. John Smith.]

    Clause 18
      THE EXECUTIVE COMMITTEE
      Amendment made: No. 15, in page 8, line 18, after 'members' insert 'of the Assembly'.—[Mr. John Smith.]
    Clause 20

      EXERCISE OF CERTAIN POWERS OF SUBORDINATE LEGISLATION
      Amendment made: No. 16, in page 8, line 40, after 'by' insert
      'or in pursuance of a resolution of'.—[Mr. John Smith.]

    Clause 23

      DEFAMATION
      Amendment made: No. 18, in page 10, line 6, after 'it' insert
      'which is fair and accurate'.—[Mr. John Smith.]

    Clause 76

      STATUTORY REFERENCES TO PARLIAMENT IN CONNECTION WITH SUBORDINATE LEGISLATION.
      Amendment made: No. 40, in page 30, line 24, after 'by' insert
      'or in pursuance of a resolution of'.—[Mr John Smith.]

  Clase 80
    REFERENDUM
    Amendment made: No. 45, in page 32, line 29, leave out from 'House' to 'Her' in line 31.—[Mr. John Smith.]
  Schedule 2

    EXISTING STATUTORY FUNCTIONS
    Amendments made: No. 47, in page 39, leave out lines 44 and 45.
    No. 49, in page 41, line 23, at end insert—
    'The Rentcharges Act 1977 (c.30). The powers under that Act so far as exercisable in relation to any rentcharge (or legally apportioned part) that affects both land in England and land in Wales'.
    No. 51, in page 42, leave out lines 44 and 45.
    No. 53, in page 44, columne 2, leave out lines 3 to 17 and insert—
    'The functions under sections 31 and 32.
    The functions under section 34 except the function of providing by regulations for the making and determination of appeals to the Assembly under section 33 and for persons to be informed of decisions on those appeals'.
    No. 54, in page 44, line 20, column 2, at end insert—
    'The powers under section 57'.
    No. 55, in page 44, column 2, leave out lines 40 to 47 and insert—
    'The powers under section 100.
    The powers under section 102 so far as exercisable in relation to the bodies referred to in subsection (1)(a)'.
    No. 56, in page 44, line 50, column 2, leave out from '108' to end of line 51.
    No. 57, in page 45, colunm 2, leave out lines 2 to 22 and insert—
    'The functions under section 119.
    The power under section 124(6).
    The power of the Treasury under section 126(2) so far as relating to any power which remains exercisable by the Secretary of State.
    The functions under section 127 so far as their exercise is incidental to functions which remain exercisable by a Minister of the Crown or relates to the bodies referred to in section 5(4) and 102(1)(a).
    The powers under paragraph 10(1) of Schedule 5 and, so far as incidental to those powers, the functions under paragraph 11(1) of that Schedule.
    The power under paragraph 5 of Schedule 7 and, so far as exercisable in connection with
    394
    any body established under that paragraph, the power under paragraph 6 of that Schedule'.
    No. 58, in page 45, line 24, column 2, at end insert—
    'The powers under Schedule 13.
    The power under paragraph 8 of Schedule 14'.
    No. 62, in page 51, line 15, leave out 'section' and insert 'sections 13(4) and'.
    No. 67, in page 54, leave out lines 26 and 27.
    No. 70, in page 56, column 2, leave out lines 44 and 45 and insert—
    'The functions under Part II and, so far as they relate to grants or loans under that Part, sections 19 and 20.'.
    No. 74, in page 57, column 2, leave out line 27 and insert—
    'The functions under sections 17(3) and 20(6).
    The powers under section 112 so far as exercisable in relation to a canal forming part of a harbour.
    The powers under section 113 so far as exercisable in relation to a waterway forming part of a harbour or owned or managed by excepted statutory undertakers.'.
    No. 75, in page 57, line 28, column 1, after '57', insert '112, 113'.
    No. 76, in page 60, line 11, column 2, at beginning insert—
    'The power to concur in regulations not exclusively made in connection with burials in Wales or the notification of registrars in Wales.'.
    No. 77, in page 60, line 15, column 2, at beginning insert—
    'The power to approve regulations not exclusively made in connection with marriages in Wales or notices given to, or certificates or licences issued by, persons in Wales.'.
    No. 78, in page 60, line 17, column 2, at beginning insert—
    'The power to approve regulations made for the purposes of section 3A or 14 and regulations not exclusively made in connection with births or deaths in Wales or registration in Wales.'.
    No. 79, in page 60, line 20, column 2, at beginning insert—
    'The power under section 20 to approve regulations not exclusively made in connection with the registration service in Wales.'.
    No. 80, in page 60, leave out lines 23 and 24.
    No. 81, in page 60, line 25, column 2, at beginning insert—
    'The power to approve regulations not exclusively made in connection with marriages in Wales.'.—[Mr. John Smith.]

  Schedule 10

    POWERS OF ASSEMBLY TO MAKE OR CONFIRM ORDERS SUBJECT TO SPECIAL PARLIAMENTARY PROCEDURE
    Amendments made: No. 99, in page 68, line 39, column 1 after '2' insert '18'.
    No. 100, in page 69, line 36, at end insert—
    'The Town and Country Planning Act 1971 (c. 78) Schedule 20 paragraph 3.
    If objection is made by excepted statutory undertakers.'—[Mr. John Smith.]

  Schedule 11

    AMENDMENTS OF ENACTMENTS
    Amendments made: No. 101, in page 70, line 28, at end insert—
    'THE BIRTHS AND DEATHS REGISTRATION ACT 1926
    2A. In prescribing anything for the purposes of section 1 of the Births and Deaths Registration Act 1926, the Registrar General may make separate provision in connection with burials in Wales and burials in England; and in prescribing anything for the purposes of section 3 of that Act he may make separate provision in relation to the notification of registrars in Wales and the notification of registrars in England.'.
    No. 102, in page 71, line 3, at end insert—
    'THE MARRIAGE ACT 1949
    6A. At the end of section 74 of the Marriage Act 1949 there shall be added the words" and may make separate provision in connection with marriages in Wales or notices given to, or certificates or licences issued by, persons in Wales".'.
    No. 103, in page 72, line 21, at end insert—
    THE BIRTHS AND DEATHS REGISTRATION ACT 1953
    11A. Section 39 of the Births and Deaths Registration Act 1953 shall become section 39 (1) and at the end of it there shall be added—
    "(2) The power to make regulations under this section includes power to make separate provision in connection with births or deaths in Wales or registration in Wales."
    THE REGISTRATION SERVICE ACT 1953
    11B. The Registrar General shall for the purposes of section 19 of the Registration Service Act 1953 prepare separate general abstracts relating to registrations in England and registrations in Wales; and so much of that section
    396
    as provides for an abstract to be laid before each House of Parliament shall not apply to an abstract relating to registrations in Wales.
    11C. At the end of section 20 of that Act there shall be added the words "and the power to make regulations under this section includes power to make separate provision in connection with the registration service in Wales."'.
    No. 104, in page 75, line 30, leave out 'and'.
    No. 105, in page 75, line 35, at end add '; and
    (e) after subsection (6) there shall be added—
    "(7) The Welsh Assembly shall not charge a committee with the exercise of its power to make orders under this section ".'.
    No. 106, in page 76, line 5, at end insert—
    'THE MARRIAGE (REGISTRAR GENERAL'S LICENCE) ACT 1970
    29A. At the end of section 18(2) of the Marriage (Registrar General's Licence) Act 1970 there shall be added the words "and power to make separate provision in connection with marriages in Wales."'.
    No. 107, in page 84, leave out line 2 and insert—
    '88.—(1) The Secretary of State may give directions to the Assembly as to the exercise of any of its functions under sections 29 and 34 to 43 of the National Health Service Act 1977, and the Assembly shall give effect to any such directions.
    (2) The power of the Secretary of State under this paragraph includes power to require functions to be conferred on him by or under regulations made by the Assembly.
    88A. In section 111(1) of that Act, for'.—[Mr. John Smith.]
    Bill to be read the Third time tomorrow and to be printed [Bill 122].

  COLONSAY (ELECTRICITY SUPPLY)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Snape.]
  11.15 p.m.
  Mr. Ian MacCormick: When I originally hoped to have a debate on the electricity supply on the Isle of Colonsay, I could not have anticipated the events of yesterday—chiefly the fact that the SNP candidate who will represent Colonsay on the Strathclyde Regional Council was successful in defeating

  397
  the Conservatives and putting the Labour Party into a poor third place.
  Lest it be said that I am being unfair to the Government, I should like to pay a tribute to the forebears of the present holders of ministerial office. The Hydro-Electric Development (Scotland) Act 1943 was the brainchild of the late Tom Jackson, M.P., and was supposed to take electricity to every part of the Highlands and to every small village and island. I greatly support that Act, which was one of the fine things that the Labour Party of those days decided to do.
  There is a second thing that I admire the Labour Party for doing, namely, for creating the Highlands and Islands Development Board in more recent times. It is significant that between them the Hydro-Electric Board and the Highlands and Islands Development Board, with the valuable assistance of the British Army, set up a scheme to give the people of the Isle of Colonsay some sort of electricity supply. It is not a perfect electricity supply. For most people it is available for only 12 hours a day, but it provides one of the staffs of life to the people there.
  As the Member for the constituency with most islands in it, certainly on the western side of the country, I wonder how one compares one island with another. On Tiree all the electricity consumed is produced on the island by a diesel-powered station. Clearly there is no way in which the people of Tiree are being supplied with electricity at what we would call an economic rate, but the Hydro-Electric Board has made plain that the people of Tiree, Islay, Mull and all the other islands in my constituency where all or part of the electricity is generated by diesel power on the islands will pay comparable tariffs to those paid by those of us on the mainland who are more fortunate.
  I feel strongly that one of the things that should inspire any Government with any feeling for small communities is the determination to decide to create conditions on islands such as Colonsay so that people can live there and young people can be encouraged to stay.
  For 10 years I was a schoolmaster at Oban High School and I taught many of the children from Colonsay. I felt sad that the more we taught those children, the more likely it was that they
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  would leave and make their living elsewhere. I remain convinced that, if it had been more easy for them to make their living on Colonsay and if conditions there had been more easily balanced with those elsewhere, it would have been easier for them to decide to stay where they had been brought up and where they belonged.
  If I may touch the Minister of State at all on any raw mark, I should ask: would not provision of the sum which would be necessary to equalise Colonsay's charges which are four times the amount that I pay in the town of Oban for my electricity, be a tremendous step in the right direction for the young and, indeed, the old people of Colonsay?
  The Minister of State must be well aware that in communities such as Colonsay—this is mirrored elsewhere throughout the Western Isles—one of the hardships that people have to face is that they are living in ageing communities. It is all very well to thank the North of Scotland Hydro-Electric Board, the Highlands and Islands Development Board and the Army for providing a scheme. But is it enough to thank them? Is it not more to the point to look carefully into how these people will pay the tariffs which are now charged? As I have said, the tariffs charged on the island of Colonsay are by and large four times greater than those charged on the mainland. They are four times the tariffs charged on the islands of Tiree, Mull and Islay, all of which have similar arrangements for the generation of electricity.
  I know that the people of Colonsay are highly subsidised in other ways. For example, I know that, through the transport system, the MacBrayne Company, which runs the steamer to Colonsay, if asked to charge a reasonable or economic fare, would have to ask £120 for every person who travelled to Colonsay. That means local people as well as any tourists who might care to visit the island.
  If, on the one hand, we are prepared to supply that kind of subsidy to the people who live there and to those who visit the island, ought we not also, in view of the relatively paltry sums involved, to think of making up the difference between what the Minister of State, myself and everyone else, even in Argyll, pays and what the people of the island of Colonsay pay? After all, only 50

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  households are involved—about 100 people—and that would not break the nation's purse.
  11.23 p.m.
  The Minister of State, Scottish Office (Mr. Gregor MacKenzie): I do not want to begin my speech tonight by making a grudging comment on the opening remarks made by the hon. Member for Argyll (Mr. MacCormick). Far be it from me to do so, since obviously on a day such as today I am possessed of the spirit of Christian charity, enthusiasm or whatever one might call it. I am delighted if the hon. Gentleman is pleased with his little game in the Strathclyde Region. I note only that there are now more Members on the Scottish National Party Bench in this House—all three of them—than will sit in the Strathclyde Regional Council.
  But that is not the purpose of the debate. It is to discuss the hon. Gentleman's proposition that the Hydro Board should in some way subsidise the people who live on Colonsay. I think that the hon. Gentleman put the points fairly, but if I go over some of them again I hope that he will excuse me as I want to get them on the record.
  The hon. Gentleman said that many who live on the mainland of Scotland take for granted the supply of electricity which has always been available to us. I am conscious that it is not available on Colonsay. But the Colonsay Community Electricity Association is to be congratulated on the steps which it has taken, albeit with a considerable range of assistance from public bodies—I shall come to them later—to create a generating and distribution system for the island.
  There is one thing that I want to make crystal clear in this Adjournment debate. I think that the House knows exactly the extent of my personal responsibility and that of the Secretary of State in this matter.
  As the hon. Member knows, responsibility for the supply of electricity in the Highlands and Islands rests fairly and squarely with the North of Scotland Hydro-Electric Board. The choice of areas which can be given a supply of electricity and the determination of priorities for connecting areas which have no public supply are matters for the
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  Board. This is a management matter and it would not be appropriate for me to intervene. The hon. Member wrote to the Board on 26th April. That was only a few days ago. He should wait until the chairman of the Board and his colleagues decide what to do.
  It might be helpful if I summarise the difficulties. I am grateful for the kindly references that the hon. Member made to the Board. Since the vesting date in 1948, the Hydro Board has provided a supply to an additional 330,000 customers. The total of 520,000 now connected represents 98·5 per cent. of potential consumers in the Board's district, and of this total some 115,000 consumers who cannot be provided with a supply economically have been connected in rural areas at a capital cost of about £27 million and a continuing annual loss.
  The remaining potential consumers are mostly in areas where access is difficult and the costs of connection are extremely high. It is the Board's intention to provide most of these potential consumers with a mains supply as quickly as possible, having regard to the constraints involved. To this end, the Board has embarked on a five-year rural development programme by the end of which, in 1982, a further 1,400 consumers will have been connected at a cost of nearly £6 million. By that date, 99 per cent. of potential consumers will have been connected to a mains supply. The magnitude of this achievement is brought into perspective when one takes into account the fact that the Board's district covers about one-quarter of the land area of the United Kingdom but has only some 2 per cent. of its population. That is to the Board's credit.
  Mr. MacCormick: Can the Minister confirm that the 99 per cent. does not include the people of Colonsay?
  Mr. MacKenzie: That is right, but I have dealt already with the problem. I shall return to it. I have stressed my responsibility. All that I am doing is setting the proper scene for an Adjournment debate.
  Before the Colonsay Community Electricity Association was established, there were four small local electricity schemes on the island. In 1975, Highlands and Islands Development Board staff examined the electricity supply situation as a

  401
  whole on Colonsay and concluded, following discussions with the Hydro Board, that a community generating and distribution scheme would be a practical and sensible replacement for the four existing schemes. The Highlands Board then organised a series of public meetings on Colonsay at which the community indicated its support for the idea of a locally managed electrification scheme.
  The possible unit costs of the electricity supply were discussed at many of these meetings on the island and it was always stressed that, while units costs of 7p or 8p were being talked about, those figures were provisional and, with several other considerations, it could not be assumed that the unit costs would in practice be of that level. I have been assured by the Highlands Board that these considerations were understood and accepted by the hon. Member's constituents.
  The hon. Member would wish to give credit to the HIDB for deciding to provide considerable financial assistance for the construction of the scheme. He said that it was churlish not to provide more support for the scheme. It is worth noting, however, that by the beginning of 1977 a scheme involving capital expenditure of £22,000 had been decided upon. The Highlands Board offered a grant of £12,500 towards the construction of the scheme. Strathclyde Regional Council, which is a good authority which looks after the interests of the people of Strathclyde well and will do so even better in future, provided £5,000. The Argyll and Bute District Council provided £2,500.
  The Hydro Board itself contributed some £4,250 through the Highlands Board, together with technical assistance and help with the procurement of materials. The Hydro Board made it clear, however, that this contribution implied no responsibility on its part for the establishment and maintenance of the scheme and that no further financial assistance would be made available. The Colonsay Community Electricity Association was required to provide £1,000 towards the capital cost of the scheme, to be raised by means of a levy on subscribers.
  The hon. Member referred to the fact that we are all very grateful to the Army for arranging a training exercise on Colonsay in 1977, during which most of
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  the work involved in installing equipment for the generating station and overhauling the distribution system was carried out. The HIDB and the local association would, like the hon. Member and myself, wish to express, I think, their very genuine appreciation to the soldiers who carried out that work.
  Actual expenditure involved turned out to be considerably in excess of the sums contributed. The HIDB therefore decided, in March of this year, to increase its contribution to the association by some £12,000 to cover these increased costs.
  I mention these various sums because I think it important to record that, far from being complacent about small communities such as Colonsay, the HIDB, the regional council, the district authority and the Hydro Board have made very substantial contributions to the capital costs involved.
  I know, as the hon. Member has said, that the price of electricity produced is high. The cost is about 11p per unit as compared with the 2p or 3p which we pay on the mainland. But, although costs are high, the community electricity scheme represents a bargain for the people of the island in respect of the cost of connection. I have already mentioned the contribution to the capital cost made by the community, which amounted to about £1,000. On average, that represents about £20 per consumer. By contrast, the current standard charge for new connections to the public supply applied throughout the Hydro Board's district amounts to about £90, which is a very much higher connection charge than may be required from individual consumers in remote parts of the mainland.
  The Highlands Board and all the other public bodies involved have ensured that the capital costs of installing the local system have not placed a burden on the Colonsay community. As I said earlier, I think that the various organisations concerned have been very generous to the people who live there. The hon. Member has mentioned that there are about 50 possible consumers and that there is a population of about 100. I do not deny that they have a right to these things, but I am bound to say that I think that the various authorities have been very helpful to the people of Colonsay.

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  Whilst I should like to give a more positive response, I can only say in conclusion that which I said at the beginning of my comments. We have a Hydro-Electric Board. It has certain responsibilities. It is no part of my duty and obligation as a Minister of the Crown to tell it how to do its job. I think that it
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  would be in the best interests of all concerned if the hon. Member awaited the reply to the letter that he wrote on 26th April to the chairman of the North of Scotland Hydro-Electric Board.
  Question put and agreed to.
  Adjourned accordingly at twenty-six minutes to Twelve o'clock.

  Second Reading Committee
  Wednesday 3rd May 1978

  The Committee consisted of the following Members:

  Mr. John Spence (in the Chair)

  Archer, Mr. Peter (Solicitor-General)

  Miscampbell, Mr. Norman (Blackpool, North)

  Bell, Mr. Ronald (Beaconsfield)

  Berry, Mr. Anthony (Southgate)

  Price, Mr. Christopher (Lewisham, West)

  Buck, Mr. Antony (Colchester)

  Ryman, Mr. John (Blyth)

  Crowder, Mr. F. P. (Ruislip-Northwood)

  Sandelson, Mr. Neville (Hayes and Harlington)

  Ewing, Mrs. Winifred (Moray and Nairn)

  Havers, Sir Michael (Wimbledon)

  Sever, Mr. John (Birmingham, Ladywood)

  Kershaw, Mr. Anthony (Stroud)

  White, Mr. Frank R. (Bury and Radcliffe)

  Lyons, Mr. Edward (Bradford, West)

  Wilson, Mr. William (Coventry, South-East)

  STATE IMMUNITY BILL [Lords]
  10.32 a.m.
  The Solicitor-General (Mr. Peter Archer): I beg to move,
  That the Chairman do now report to the House that the Committee recommend that the State Immunity Bill [Lords] ought to be read a Second time.
  If someone were told that the Bill was being taken in Second Reading Committee and that the Committee consisted almost entirely of practising lawyers, he might be forgiven for concluding that it was a technical measure of no practical consequence. He would be right about its being a technical measure, but its practical consequences are real, and are of two kinds.
  First, the Bill may help to ensure that individuals who have claims against foreign States may obtain redress in circumstances where previously they would have had no redress. Second, it has a part to play in building a body of international law relevant to the needs of the 1970s and 1980s, commanding a wide measure of agreement and with a real prospect of being applied across a wide sector of the world.
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  The primary purpose of the Bill is to prescribe in statutory form the immunity from suit which foreign States shall be entitled to claim from the jurisdiction of the courts in the United Kingdom. The present rules are embodied in the common law, and originally the rule was simple and absolute. It can, perhaps, best be summarised in the words of Lord Atkin in the case of "The Cristina" in 1938, which were quoted by my noble Friend in the other place on Second Reading—this is column 52 of the Official Report, 17th January, Lord Atkin said that there were two basic elements: first,
  "that the courts of a country will not implead a foreign Sovereign, that is, that they will not by their process make him against his will a party to legal proceedings where the proceedings involve proceedings against his person or seek to recover from him specific property or damages";
  and second,
  "that they will not by their process, whether the Sovereign is a party to the proceedings or not, seize or detain property which is his."
  That doctrine arose as a matter of reciprocal respect, when it was felt that

  407
  for one State to assume jurisdiction over another was inconsistent with sovereign equality between States.
  But the rule attracted criticism at least as long ago as 1873 when another great commercial judge, Sir Robert Phillimore, in the case of the "Charkieh", said:
  "No principle of international law, and no decided case, and no dictum of jurists of which I am aware, has gone so far as to authorise a sovereign prince to assume the character of a trader, when it is for his benefit; and when he incurs an obligation to a private subject to throw off, if I may so speak, his disguise, and appear as a sovereign, claiming for his own benefit, and to the injury of a private person, … all the attributes of that character."
  How far the common law on the matter is capable of changing, and how far it has in fact changed, was recently discussed at some length in the court of Appeal in the case of Trendtex Corporation v. Central Bank of Nigeria. In another place there was some discussion about how much light would be shed on the debates relating to this Bill when that decision was considered by the Appellate Committee in the other place. I am now informed that the case has been settled and that, consequently, we shall be denied what would certainly have been a constructive and a fascinating decision.
  What is certain is that in this generation, when States engage widely in commercial activities and generally do many things which in earlier times would not have been associated with the jus imperii, Sir Robert Phillimore's pronouncement is increasingly frequently of practical application. In the Trendtex case, the Master of the Rolls said:
  "In the last 50 years there has been a complete transformation in the functions of a sovereign State. Nearly every country now engaged in commercial activities. It has its departments of State—or creates its own legal entities—which go into the market places of the world. They charter ships. They buy commodities. They issue letters of credit. This transformation has changed the rules of international law relating to sovereign immunity. Many countries have now departed from the rule of absolute immunity. So many have departed from it that it can no longer be considered a rule of international law. It has been replaced by a doctrine of restrictive immunity."
  The immunity of States is not a matter which ought long to be left in an area of doubt. It affects the rights and duties
  408
  of individuals, and it has important effects on international trade and finance.
  The first internationally agreed move away from absolute immunity occurred in relation to maritime law. A diplomatic conference in Brussels produced in 1926 a convention on State owned ships which, broadly speaking, sought to place commercial ships operated by States in the same position as if they were privately owned. It was supplemented by a protocol in 1934. The United Kingdom participated in the discussions and signed the 1926 convention in that year.
  The Convention and Protocol have now been ratified by a large number of maritime countries, but plans to implement its provisions in this country were overtaken by the outbreak of war. For one reason or another, we have never been able to ratify. This Bill will now, at last, bring our law into line with the provisions of that convention and the protocol and enable the United Kingdom to ratify them. The relevant provisions are found in Clause 10 and parts of Clause 13.
  There may be hon. Members who remember the concern expressed in both Houses in 1949 when the Tass Agency was sued for defamation, and the Court of Appeal stayed the proceedings on the ground that the agency was a department of the Soviet State and entitled to immunity.
  An interdepartmental committee under the chairmanship of the late Lord Somervell was then appointed to examine whether our law accorded the organs of foreign States immunity wider than was desirable or than was strictly required by international law. But the committee's report was somewhat inconclusive as to what international law required, and it was troubled by the problem of drawing a sufficiently precise distinction between sovereign activities, on the one hand, and trading, commercial or industrial activities, on the other.
  The Government of the day did not feel justified in taking any action, and the rule of absolute immunity continued to be followed in the courts of this country, while in the rest of the world it began increasingly to give way to practices denying immunity in respect of commercial activities. Probably the most significant change came in 1952, when

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  the State Department of the United States declared, in the Tate letter, that it had examined contemporary State practice and had reached the conclusion that immunity should not be granted, inter alia, in respect of a foreign State's commercial activities.
  The rule of absolute immunity followed by the courts of the United Kingdom has been widely criticised, and it was against this background that in the early 1960s the Lord Chancellor and the Law Officers of the day encouraged an examination of the current international law and practice, and the possibility of an international convention on State immunity, by the member States of the Council of Europe. This led to the European Convention on State Immunity, which was opened for signature in May 1972. One of the objectives of the Bill is to enable the United Kingdom to ratify that convention.
  Although parts of the Bill are modelled on the convention, its provisions are more radical than the convention. Initially, the Bill followed the convention in most respects, but it was pointed out in another place, particularly by Lord Wilberforce and Lord Denning, that in restricting itself in that way the Bill might lead to a situation where the United Kingdom courts continue to recognise immunity in circumstances where it would not be generally recognised in international law. My noble Friend listened carefully to what was said, as might be expected of him, and he was persuaded.
  I wish, therefore, to spend a few moments explaining the background, and why we have gone substantially further in removing immunity than the European convention would require us to do.
  Hon. Members will recognise that there are three distinct legal concepts which we shall consider in our proceedings on the Bill. First, there are grounds on which the courts of this country will assume jurisdiction over a dispute. If the dispute has nothing to do with this country or any of its citizens, the courts will normally not entertain proceedings and the question of claiming immunity will not arise.
  Second, there are the rules governing State and diplomatic immunity once the courts have accepted jurisdiction. Third, there are the rules relating to the enforce-
  410
  ment of judgments once the court has proceeded to deliver judgment.
  A basic feature of the convention is that contracting States assume an obligation to give effect to judgments given against them in the courts of other contracting States. A convention which simply sets out the cases in which the courts of a State could assume jurisdiction over other States, overruling claims to immunity, would have had little interest for those States which, unlike the United Kingdom, already assumed jurisdiction very extensively. For them, the interest of a convention lay in securing the recognition and enforcement of judgments given against the foreign State.
  A consequence of this basic feature is that, broadly, the convention provides that claims to immunity will be rejected only where the territorial connection with the court which assumes jurisdiction is sufficient to warrant recognition and enforcement of its judgment by other convention States.
  It is our intention to apply the principles of the Bill to all States, whether parties to the convention or not. In relation to those not parties to the convention, there is, of course, no need to restrict our courts in that way. For example, we do not need to say that immunity in relation to commercial activities shall depend on whether an obligation falls to be performed in the United Kingdom. But we can say that it is not to be accorded in relation to any such activities where our courts accept jurisdiction.
  Again, the convention embodies the principle that execution may not be levied against the property of a State without its consent. This is a corollary of the basic features that each contracting State accepts an obligation to give effect to judgements given against it by the courts of another contracting State where the case falls within the catalogue of cases where immunity is not to be accorded. As the defendant State will give effect to the judgment, there is no need for execution to be levied.
  But there is far less cause for affording foreign States immunity from execution if they are not under any binding obligation to comply with our judgments. Consequently, Clause 13 removes immunity from execution to the full extent to which we believe it is permissible to

  411
  do so under current international law and practice.
  While introducing this far-reaching curtailment of State immunity, we can still ratify the European convention. Article 24 of the convention permits a contracting State to declare that its courts shall be entitled to entertain proceedings against a contracting State, even where the case does not fall within the express provisions limiting immunity, to the extent that they are entitled to entertain them in relation to States that are not parties to the convention.
  Between contracting States that make declarations under Article 24 there is then an obligation to give effect to judgments on that wider basis, while other States which have made no such declaration are freed of their obligations to recognise and enforce the wider category of judgments, so it would thus be reciprocal.
  I began by referring to the case of Trendtex Corporation v. Central Bank of Nigeria. In that case the Court of Appeal, by a majority, declined to follow the older authorities and rejected a claim to sovereign immunity by the defendants where the matter in dispute concerned commercial transactions. It declared that the common law must follow the movement of international law and practice and that, on the research available to the court, the rules of international law had changed significantly.
  Similarly, the Privy Council, in the case of the "Philippine Admiral" in 1976 held that in actions in rem against ships, immunity will not be accorded to a vessel owned by a foreign Government if it is being used either by the Government itself, or by a third party, for trading purposes and is not intended to be used for public purposes.
  The line adopted by the Bill accords generally with the doctrine developed in those cases. Indeed, the fact that the Court of Appeal arrived at its conclusions in Trendtex after an extensive examination of recent decisions in Belgium, Germany, the Netherlands and the United States will offer the House some reassurance that what the Bill seeks to do accords with the current state of international practice.
  It may be suggested that these recent decisions remove the necessity for
  412
  legislation in this field and that it may be left to the courts to develop the law. The Government believe that that would not be right. There is always the possibility that one day these questions may fall to be decided judicially in another place, and it may there be held that the courts ought to follow the older line of established precedence.
  The law ought now to be firmly established by statute. Furthermore, the recent cases relate only to commercial transactions, whereas the Bill, following the European convention, removes immunity over a wider area of other activities where the State may not be acting commercially. Clauses 4 to 9 and 11 remove immunity in respect of many important matters which the recent cases do not touch.
  There is a further important consideration which, in the Government's view, adds an element of urgency to this legislation. In 1976, the United States Congress passed the Foreign Sovereign Immunities Act, which renders foreign States amenable to the jurisdiction of the United States courts in respect of practically all non-sovereign activities and permits execution to be levied against their commercial assets.
  The position now obtaining in the courts of the United States accords with the interests of all those who, in commerce or finance, engage in transactions with foreign States. Unless we change our law, much of the work connected with these transactions—an important invisible export—could be lost to this country. I believe that, for these reasons, the Bill will be welcomed in all parts of the Committee and of the House.
  I shall now briefly draw attention to some of the major changes which the Bill is intended to bring about. Clause 2 provides that a State is not to be immune in respect of proceedings where it has submitted to the jurisdiction of the court. It specifically provides that such submission may be contained in a prior written agreement. Under the common law, a State could disregard any prior written agreement and it would be bound only by a submission to jurisdiction made in the course of the proceedings before the court.
  Clause 3, as amended in the other place, provides that a State shall not be

  413
  immune in respect of any acts in a commercial or similar capacity, and it singles out two particular activities where it is not always possible to determine whether the subject matter is commercial or not. In any event, the term "commercial transaction" is given a very wide meaning. It will cover all commercial, industrial, financial, professional, or similar activities—in short, almost anything that a State may do outside its sovereign authority.
  Clause 13 permits execution against property used, or intended for use, for commercial purposes. Judgments given against the Crown in the courts of contracting States to the European convention will have to be recognised here; that is the result of Clause 18, and it corresponds with the obligation assumed by other contracting States to give effect to judgments given against them in the courts of the United Kingdom.
  In respect of the rest of the world, we shall, of course, assume no such obligation. Indeed, we want to remain free to reduce their immunity still further should we find that they do not accord corresponding immunity to the United Kingdom. That is achieved by Clause 15, which also allows immunity to be extended where there is an international commitment to do so.
  The Bill also provides an opportunity to clarify one or two other areas of uncertainty. The exact extent of the privileges and immunities of foreign Heads of State in their private capacity is difficult to ascertain from the decided cases. Clause 20 would equate the position of a Head of State with the position of an ambassador.
  There is a degree of uncertainty about the ability of our authorities to sue foreign States for taxes, customs and other duties. We are taking the opportunity in Clause 11 to resolve those doubts.
  I hope that the Bill commends itself to the Committee and the House as a useful measure of reform to codify and, I think, to clarify an area where clear guidance is needed. It will provide remedies in cases where they are sometimes at present unjustly denied, and it will bring our law on the immunity of foreign States more into line with current international practice. Those of us who discuss the Bill are unlikely to earn
  414
  wide coverage in the news media, but we may merit a footnote in the law books of the future.
  10.52 a.m.
  Sir Michael Havers: I thank the Solicitor-General for his helpful explanation of the Bill. May I offer congratulations, too, to the noble Lords Lord Denning and Lord Wilberforce, and to Baroness Elles, who in the other place did so much to improve the Bill. Also, while in a congratulating mood, may I congratulate the noble Lord the Lord Chancellor, and particularly his officials, who responded to the various amendments and did so much to improve the Bill between the time it was first put before the other place and its presentation to us. It is now a very much better Bill.
  It is astonishing to see, from a reading of the Committee stage in the other House, how the proceedings ended up with five people right on top of their subject and all determined that this should be the best possible Bill to remove a difficulty which even I, as a lawyer, had not understood existed—this not being one of my specialities—that if a State entered into a contract with you, Mr. Spence, for example, on behalf of some large company, or as an individual, and in that contract the State had agreed to waive any right to immunity which it might subsequently have, that was an absolutely worthless paragraph in the contract and could not be binding upon that State at all—which seems a ridiculous situation.
  That difficulty has now become of great importance, as the Solicitor-General has told us, because our law is now out of date in relation to recent legislation in the United States. Certainty now applies there, and this has had its effect upon the two great financial centres which have been dealing with these contracts because of the efficiency of their law and the lawyers and the ability to get a whole team of people together in one place, either in the City of London or in New York. The fact that a contracting party feels that in this country there may be some uncertainty about whether he can proceed against the State as the other contracting party or about whether a plea of immunity may be successful has already caused a great deal of the work that used to be

  415
  done in the City of London to go to New York.
  Therefore, speed is essential. This is a substantial part of the work of the City and a substantial source of invisible earnings for our balance of payments. As was emphasised in the other place, and as the learned Solicitor-General has impressed upon us today, speed is of great importance in this matter.
  I hope, therefore, that it will be thought right if on Second Reading I indicate certain matters which we consider could be further improved. It will be helpful to those who are assisting the learned Solicitor-General if, when the Bill goes into Committee, these matters are not raised for the first time when the amendments are seen but everybody is alerted today to the few important matters which need to be looked at and, if possible, further improved to make the Bill even better.
  Clause 3 is virtually a new clause compared with the original. Its basic principle is that where a State has not expressly or impliedly submitted to the jurisdiction of a United Kingdom court under Clause 2, it will still lose its immunity in respect of commercial, industrial, financial or other similar activities provided that it has not entered into them
  "in the exercise of sovereign authority".
  By virtue of paragraphs (a) and (b) of subsection (3), it is not necessary to decide whether in the cases there covered there was an exercise of sovereign authority, but in other cases it may be so. This has been one of the very difficult problems about which lawyers have had to advise their clients over the years. The law is by no means clear. I shall spare the Committee the technical details, but there are occasions when it is very difficult to advise somebody on the law. We may find yet again that lack of certainty could arise in those special cases in this country, again creating the result which exists at the moment—that people would prefer to go to New York where there is absolute certainty.
  Those who had argued that the Bill was premature because of the Trendtex case pending in the Appellate Committee of the House of Lords have now, of course, had that objection struck from under them. I am rather sad about that. I should have liked to see what the
  416
  Appellate Committee made of Trendtex, because it is one of the most interesting cases in international law that there has been for a long time.
  To summarise our views on Clause 3, we consider either that there should be a suitable definition—if it can be devised—of what is meant by
  "in the exercise of sovereign authority"
  or we might consider whether those words could be taken out altogether, though I appreciate that that would be a substantial step.
  Many loans are made not directly to a State but to a Government agency and guaranteed by the State. This goes back to the case where "the exercise of sovereign authority" cannot arise directly. If the State is not immune in respect of a loan raised by it, regardless of its purpose, as at present provided, it would seem entirely logical that the State should be similarly not immune in respect of a lesser liability. It should not therefore have an immunity when it is merely acting as guarantor when it has no immunity when it is the borrower. I hope that that point will be taken on board and considered.
  I think that that could be covered by an amendment on these lines—
  "… any guarantee given by a State in respect of any financial obligation, irrespective of the purposes for which the obligation was incurred"—
  or something of that kind. The learned Solicitor-General and I were brought up on the old principle that the greater includes the lesser. On that principle, it must logically do so here, though I think that at the moment it might be excluded.
  Clause 13 is very important. It involves the remedies which can be granted by the courts, including interlocutory relief in certain cases. I shall avoid the technicalities of what a Mareva injunction is. I believe that the noble Lord Lord Denning is our greatest expert on the Mareva injunction. But it seems that the position left by the present drafting is as follows. It is possible for a judgment to be enforced against the property of a State, other than central bank funds, without its consent if such property is used for commercial purposes, but it is not possible to obtain without the consent of the State interlocutory relief by way,

  417
  for example, of a Mareva injunction in respect of such property.
  In Committee in the other place, on 16th March, Lord Wilberforce and Lord Denning both emphasised the need for interlocutory relief in respect of assets used for commercial purposes. Obeying the rule, I shall not directly quote what Lord Wilberforce said, but I shall summarise its effect. He said that it was important, if English courts are to have jurisdiction over assets used for commercial purposes and are to be able ultimately to lay hands on them at the suit of a British company, that in a suitable case, subject, of course, to reservations, jurisdiction should exist to grant injunctions.
  Therefore, one of the matters we shall be considering in Committee is whether interlocutory relief should be available against a State without its consent in respect of property—other than central bank funds, which have always had to be treated separately which is in use or intended for use for commercial purposes.
  It has always been accepted that for the purposes of enforcement of judgments the funds belonging to a State's central bank are regarded as the property of that State, but they are not so regarded for the purposes of interlocutory relief, which, again, is a slightly curious result. This means that a central bank as a separate entity, within the meaning of Clause 14 as it stands, would not normally be immune from interlocutory proceedings but its assets would be immune for the purpose of enforcement proceedings unless the State concerned had consented.
  In those circumstances, it would seem to us to be more logical if funds belonging to a central bank were deemed to be the property of the State both for purposes of interlocutory relief and for purposes of enforcement proceedings. If the principle applies in relation to enforcement proceedings, it seems difficult to understand why there should be a different principle when one is dealing with interlocutory relief.
  Central banks always occupy a curious position. They are very independent—certainly our Bank of England is—and one knows of a number of central banks of foreign States which are very jealous of their independence, which they carefully guard. We believe that problems
  418
  could arise under local law with regard to the capacity of a State to consent on behalf of a central bank to proceedings being taken against funds.
  Therefore, it seems to us certaintly to be a matter for consideration that it might be preferable for Clause 13 to be modified to provide that neither interlocutory relief nor enforcement proceedings should be available against the funds of a central bank without written consent, such consent—perhaps adopting the United States legislation to be given either by the central bank or by the State on its behalf.
  Clause 23 was an attempt to avoid any retrospection. This was the result of speeches in the other place, because originally there had been a degree of retrospection which, quite apart from the natural repugnance that all parliamentarians hold about retrospection, also had the difficulty that it might lead to a loss of trust and faith in our English system if a State had entered into a contractual liability, relying upon the law as it then stood, and then suddenly found, having chosen the law of England as the law of the contract, that English law had changed retrospectively. That could well destroy such faith. I believe that there will be very few occasions which would be so affected, but it could destroy the faith of such a contracting country, which is the one thing that we are most anxious should not happen.
  It is quite clear that in the other place there was a determination to avoid retrospection, and that, I believe, is why Clause 23 was amended in that sense. Subsection (3) provides that the Bill
  "does not apply to proceedings in respect of matters that occurred before the coming into force of this Act; and section 9 above applies only where the arbitration agreement is made after the coming into force of this Act."
  I do not want to go into technicalities—I have already had a word with the learned Solicitor-General and I believe that he accepts this but we believe that there are occasions when retrospection could, unintentionally, apply. The noble Lord, Lord O'Brien—representing, one might say, the City interests in the other place—pointed out the dangers that would follow from any form of retrospection. I believe that this is a matter under consideration by those advising the Lord Chancellor, so I merely say that we also

  419
  are anxious about it and hope that a tightening-up amendment can be achieved before we reach Committee.
  I apologise for the detail. I hope that it has been helpful to those who are preparing for the passage of the Bill through the House. We welcome the Bill and look forward to its becoming the law of the land as soon as possible.
  11.3 a.m.
  The Solicitor-General: I am grateful to the right hon. and learned Gentleman both for his kind words and for his constructive approach to the Bill. It is clear that we are agreed on the urgency of the Bill reaching the statute book and that we share a concern that it shall be as effective as possible for its purpose.
  I am grateful to the right hon. and learned Gentleman, too, for the indications which he gave in advance of the Committee stage of the matters which he proposes to raise so that I may consider them, together with my noble Friend the Lord Chancellor. Clearly, no useful purpose would be served by my commenting on them at this stage, except to say, on the question of retrospection, that I had it in mind to table an amendment in Committee. In respect of both that and the other matters raised by the right hon. and learned Gentleman, some consultations between us in advance of the Committee

  THE FOLLOWING MEMBERS ATTENDED THE COMMITTEE:

  Spence, Mr. John (Chairman)

  Price, Mr. Christopher

  Berry, Mr.

  Ryman, Mr.

  Buck, Mr.

  Sever, Mr.

  Havers, Sir M.

  Solicitor-General, The

  Miscampbell, Mr.

  White, Mr. Frank R.

  may spare the Committee a certain amount of time when the day comes.
  It was suggested to me a few moments ago by my hon. Friend the Lord Commissioner that we might proceed to the Committee stage this morning, but I think that that would be a little too optimistic. Clearly, the amendments will have to be drafted and we shall have to discuss them with my noble Friend. But one may hope that the Committee will not be delayed unduly when the times comes, especially since I understand that no other hon. Member has any particular views on any of the matters that have been raised.
  I think that we need not trouble the Committee any further this morning, unless any of my hon. Friends wish to raise any matter. I hope that in due course, when the Bill reaches the statute book, the outcome will be, as a consequence of the contributions made to it by a number of legal minds in both Houses, something of which we shall all have reason to be satisfied.
  Question put and agreed to.
  Ordered,
  That the Chairman do now report to the House that the Committee recommend that the State Immunity Bill [Lords] ought to be read a Second time.
  Committee rose at seven minutes past Eleven o'clock.

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

LORD HOWIE OF TROON
William Howie, Esquire, having been created Baron Howie of Troon, of Troon in the District of Kyle and Carrick, for life—Was, in his robes, introduced between the Lord Kirkhill and the Lord Peart, and made the solemn Affirmation.
BARONESS DAVID
Nora Ratcliffe David, having been created Baroness David, of Romsey in the City of Cambridge, for life—Was, in her robes, introduced between the Baroness Llewelyn-Davies of Hastoe and the Lord Ashby.

SOUTHEND PROBATION PROJECT
2.42 p.m.
Lord BEAUMONT of WHITLEY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what steps are being taken to ensure that the work done in the Southend probation project for the rehabilitation of persistent sexual offenders is not wasted.
The MINISTER of STATE, HOME OFFICE (Lord Harris of Greenwich): My Lords, I understand that this small-scale experiment involved two offenders and was undertaken by a single officer over a six-month period. The method consisted partly of medical treatment with a libido-suppressing drug, and partly of group therapy. Conclusions could not be drawn from such a limited project, and
172
I am informed that when the officer moved to another area the responsible chief probation officer decided not to devote further effort to it.
Lord BEAUMONT of WHITLEY: My Lords, while thanking the Minister for that Answer, may I ask whether it is true that one of the main reasons for the project not being continued was not that it had proved in any way unsatisfactory—because, as the Minister says, there have not yet been sufficient results—but that there was a shortage of available staff? If worthwhile experiments like this—and I believe that this is worth while—are carried out, is it not worth the while of the Government to keep an eye on what is going on in order to ensure that such experiments can be fully followed up?
Lord HARRIS of GREENWICH: My Lords, resources have been made available to the Probation Service over the past two or three years for a number of projects of an experimental character, and, in particular, of course, for the extension of community service. However, so far as this project is concerned, I understand that it was not regarded as especially desirable to devote efforts to this particular task. The probation officers in the area had plenty of other things to do and the chief probation officer, of course, decides about these matters; they are not matters for the Home Office.
Lord LEATHERLAND: My Lords, is my noble friend aware that in France during the First World War there was a strong belief in the minds of the soldiers that their morning tea had been doped with bromide, the intention being to make them less attracted to the civilian population in the neighbourhood?

OSMOND REPORT
2.44 p.m.
Lord INGLEWOOD: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will give the date of the first irregularities listed in the Osmond Report on the conduct of the late chief

173
constable of Lancashire, and the date of the first effective action by the Lancashire police authority in regard thereto.
Lord HARRIS of GREENWICH: My Lords, the earliest specific incident mentioned in the Osmond Report occurred in February 1970, when Mr. Parr was deputy chief constable. The allegations against Mr. Parr were brought to the notice of the Home Office in July 1976 and notified by the Home Office to the Lancashire police authority in August. Sir Douglas Osmond was appointed by the police authority to carry out an investigation on 1st September 1976: they received his report in December 1976. As the noble Lord will be aware, my right honourable friend the Home Secretary recently announced in another place that there are to be further and wider police inquiries into allegations of corruption in Blackpool.
Lord INGLEWOOD: My Lords, while I thank the noble Lord for that frank and very disturbing reply, does he not agree that a time lag of nearly six years gives grounds for concern that the system of checks and balances between the Home Office, the police authorities and chief constables for the control of police forces has broken down, at least in Lancashire? Can he say whether the police authority was in fact ignorant of what was going on and therefore was out of touch, or whether the authority knew certain things, but did nothing about them, in which case it was negligent?
Lord HARRIS of GREENWICH: My Lords, I obviously cannot speak on behalf of the police authority in a matter of this sort. All I can say is that, in July 1976, a sergeant of the Lancashire Constabulary made representations to Her Majesty's Inspectorate of Constabulary and that within one month this matter had been referred by the Home Office to the Lancashire Police Authority, with the consequences which I have outlined.

OVERSEAS PENSIONS OF EXPATRIATE OFFICERS
2.46 p.m.
Lord GRIDLEY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government when they will be able to announce completion of the takeover of overseas pensions of expatriate officers from former dependent territories.
Baroness LLEWELYN-DAVIES of HASTOE: My Lords, my right h onourable friend the Minister for Overseas Development hopes that the takeover of overseas pensions will be substantially completed by the end of this year. Arrangements have been completed for 24 out of the 39 countries concerned. I will circulate a detailed list in the Official Report. Formal agreements have been concluded with Antigua, Guyana and Malaysia.
Following is the detailed list referred to:

Countries for which arrangements have been completed:

Sudan

Fiji

Gambia

Malta

Burma

Ghana

Lesotho

Seychelles

Dominica

Botswana

Mauritius

Tanzania

Swaziland

Sierra Leone

Grenada

Jamaica

St. Lucia

Solomon Islands

St. Vincent

Gilbert Islands

Malawi

Kenya

St. Kitts

Singapore

Expatriate pensions not vet taken over:

Antigua

Guyana

Malaysia

Barbados

Cyprus

East African Community

India

Nigeria

Pakistan

Peoples Democratic Republic of Yemen

Somali Democratic Republic

Sri Lanka

Trinidad

Uganda

Zambia

Lord GRIDLEY: My Lords, while thanking the noble Baroness for that Answer, may I ask whether she considers the situation entirely satisfactory? Are the Government aware that, in pursuance of a policy laid down by them seven years ago to take over responsibility for these pensions, to date only 17,000 have actually been taken over and 25,000 remain to be taken over? Will the noble Baroness give me an assurance and some information as regards the plans which the Government might implement to expedite that situation and to complete the taking over of the remaining 25,000 pensions?
Baroness LLEWELYN-DAVIES of HASTOE: My Lords, I am afraid that nothing in life is entirely satisfactory. Her Majesty's Government are well aware of the very noble efforts that the noble Lord has made on behalf of the overseas pensioners. We are very grateful to him indeed for the trouble he has taken. I can give him an assurance that every possible means of expediting the takeover is being taken and will continue to be taken.
Baroness GAITSKELL: My Lords, I should like to ask the Chief Whip whether her remarks apply to the British who have lived in Rhodesia for some years, because I have recently received an appeal from a man about this particular aspect of pensions.
Baroness LLEWELYN-DAVIES of HASTOE: My Lords, the Question which was tabled by the noble Lord, Lord Gridley, was not to do with Rhodesia. The situation is extremely complicated in that country, but I will gladly talk to the noble Baroness or write to her about it.
Lord ORAM: My Lords, can my noble friend say whether the transfer of responsibility for the payment of these pensions brings to an end an anomaly—namely, that in aid statistics pensions paid to superannuated colonial servants now living in the United Kingdom still counted as aid to the overseas country in which they formerly served? I hope that that situation will be brought to an end. If my noble friend is not in a position to answer, will she include the information in the note which she promised to circulate in the Official Report in answer to the noble Lord, Lord Gridley?
Baroness LLEWELYN-DAVIES of HASTOE: My Lords, if not on this occasion, certainly on a later one.
Lord GRIDLEY: My Lords, I should like to put one final question to the noble Baroness. If the difficulties overseas are administrative—and to a certain extent I have sympathy for the Government as regards that—has not the time now come when it might be considered appropriate to bring this question up at ministerial level (that is to say, from Minister in this country to Minister in the independent country) and in that way try to get some assistance towards expediting the situation?
Baroness LLEWELYN-DAVIES of HASTOE: My Lords, of course. When my right honourable friend the Minister for Overseas Development goes abroad she, personally, always deals with this if there is a difficulty in the country in question. I can give the noble Lord that particular assurance. As I think the noble Lord appreciates, there are legislative difficulties which are very real in some countries. However, wherever we can, we try to help them and we keep in constant touch with the High Commissions.
Lord BOWDEN: My Lords, can my noble friend tell me whether these pensions will be properly indexed, as they should be?
Baroness LLEWELYN-DAVIES of HASTOE: My Lords, yes.

GOVERNMENT BODIES: PAYMENT OF MEMBERS
2.51 p.m.
Baroness SHARPLES: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will provide an up-to-date list of all Government and quasi-Government boards, indicating how many chairmen and other members are paid from public funds.
The LORD PRIVY SEAL (Lord Peart): My Lords, the Directory of Paid Public Appointments, first published in 1976, lists the Government bodies of which chairmen or any of the members are paid from public funds. The Civil Service Department is at present preparing, in consultation with appointing Departments, a revised edition of the Directory which will be published later this year.
Baroness SHARPLES: My Lords, I thank the noble Lord the Leader of the House, for that reply. Please can he tell us the ratio of men to women appointed to these boards?
Lord PEART: My Lords, I cannot give that information. Appointments are made only on ability. There is no sex differentiation in that sense.
Lord BALFOUR of INCHRYE: My Lords, can the Government add to the list the figure of total cost to public funds of these various bodies?
Lord PEART: My Lords, I do not have the figure. I shall certainly look at that to see whether we can assess it. However, it would be a very complicated task and expensive to compile.
Lord BALFOUR of INCHRYE: My Lords, I only want a total figure.
Lord PEART: My Lords, I shall try to obtain it.
Lord AVEBURY: My Lords, since the date when the list was last published, can the noble Lord say whether the number of these appointments has increased or diminished? Assuming that it is the former, does it not frequently happen that, when the purposes for which these organisations were first established cease to apply, instead of being dissolved, they find something else to do?—as was the case with the Location of Offices Bureau, which was set up to move jobs out of London but which is now moving them back in.
Lord PEART: My Lords, I think that the noble Lord will accept that it is important to have this information. The Directory is a very useful document, and I recommend the noble Lord on the Liberal Benches to read it very carefully. We hope that the new edition will be published during the Summer Recess; it will contain a great deal of valuable information.
Lord ORR-EWING: My Lords, will the noble Lord also consider publishing the cost of administration? In a body such as the Equal Opportunities Commission, the cost of administration has steadily risen as a percentage of the total outgoings. For the assistance of research students, will he put an asterisk against those names who are not known Labour supporters?
Lord PEART: My Lords, I do not think that the noble Lord is his usual self today; he is getting rather finicky. Let us wait and see what the Directory looks like. In fact, I shall try to have a copy sent to him, even though it may cost something!
Lord ANNAN: My Lords, can the noble Lord the Leader of the House say whether, in fact, a review is to be undertaken of the amounts of pay given to such chairmen and member; of committees? Will he not agree that the time has come to review some of these emoluments, in view of the fact that they have not been changed for years and that chairmen of many important concerns, although nominally called part-time, sometimes work full-time in the sense that their week-ends are very often not their own?
Lord PEART: My Lords, I accept what the noble Lord has said. The Top Salaries Review Board covers part of this and it will be reporting very soon.

DINNER
Baroness LLEWELYN-DAVIES of HASTOE: My Lords, with the leave of the House, may I remind the House that dinners will be available this evening and tomorrow evening.

ADOPTION (SCOTLAND) BILL [H.L.]
The LORD CHANCELLOR (Lord Elwyn-Jones): My Lords, I beg to introduce a Bill to consolidate the e lactments relating to adoption in Scotland with Amendments to give effect to recommendations of the Scottish Law Co remission. My Lords, I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read 1ª—(The Lord Chancellor.)
On Question, Bill read 1ª, and to be printed.

SCOTLAND BILL
2.55 p.m.
The LORD CHANCELLOR: 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.—(The Lord Chancellor.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD NUGENT OF GUILDFORD in the Chair.]
Clause 38 [Industrial and economic guidelines]:
Lord DRUMALBYN Lord DRUMALBYN moved Amendment No. 149:
Page 20, line 19, leave out subsection (4).
The noble Lord said: In this clause we are dealing with the industrial and economic guidelines. Subsection (4) says:
"A Scottish Secretary shall exercise the powers with respect to which guidelines are prepared under this section so as to give effect to the guidelines".
The purpose of Amendment No. 149 is to leave out that subsection and to substitute the three subsections set out in Amendment No. 151 in the Marshalled List. This Amendment was designed to cover the contingency that the guidelines are not complied with by the Scottish Secretary. The noble Lord, Lord Kirkhill, told your Lordships on Tuesday night—and I see him in his place now—that the Bill already deals with that Dntingency in Clause 36, which empowers the Secretary of State to direct a Scottish Secretary not to do something which he proposes to do or to do something that he was not intending to do, if the Secretary of State thinks that it would be in the public interest to give such a direction. However, he can do so only if the action he wants taken or not taken, as the case may be, would or might affect a reserved matter.
Therefore, I pose this question: Is the Minister who will reply satisfied that any action at variance with the guidelines, or going beyond the guidelines, would necessarily affect a reserved matter? if not, there is obviously a loophole in the subsection. Secondly, what would happen if there were a difference of opinion on the interpretation of the guidelines? Thirdly, what would happen if the Scottish Secretary, disregarding the guidelines, committed the Scottish Executive before any directive was given to him not to do so? There are bound to be marginal cases in the provision of industrial assistance and it seems to me that a Scottish Secretary may easily misinterpret the directives or the guidelines and in consequence do something which the Secretary of State will consider to be outwith the powers of the Scottish Secretary.
The noble Lord may well say that all this means that, if there is any shadow of doubt whether some action which a Scottish Secretary may intend to take falls within the guidelines, he will have to refer to the Secretary of State and obtain his consent. I am not at all certain how willing Scottish Secretaries will be to be constantly on the doorstep of the Secretary of State. But at any rate Amendment No. 151 makes the position quite clear because the Secretary of State is there enabled to give a directive if, in his opinion, the Scottish Secretary acts beyond the guidelines. If the Scottish Secretary has already taken the action in question, the Secretary of State may give him a directive and, under the subsection, that is subject to annulment by either House of Parliament.
What I am anxious to find out is what sort of control is to be exercised here. If there is a difference of opinion between the Scottish Secretary and the Secretary of State how is this to be resolved? It is all very well to say that the Scottish Secretary can just give a directive or a direction. What happens if the direction is disregarded? Is the Secretary of State going to invite the First Secretary to dismiss the Scottish Secretary? If the First Secretary is of the same opinion as the Scottish Secretary, what then? It seems to me that the Amendment that I have put down at least gives a clearer idea of the way the matter should work. As I have often said before, it is valuable to have as much as possible in the same section where it is dealing with the same set of circumstances. I beg to move.
3.1 p.m.
The MINISTER of STATE, SCOTTISH OFFICE (Lord Kirkhill): I wonder whether it would be helpful to your Lordships' Committee if I explained the Government's position as I see it, and our view of Lord Drumalbyn's Amendments which, I readily agree, are pertinent and should occasion us thought. He himself has explained that Amendments Nos. 149 and 151 are intended to provide a better procedure for enforcing guidelines. But in the Government's view the procedure already provided in the Bill is entirely adequate. I was saying, I think late on Tuesday night, and I feel I must repeat it again this afternoon, that Clause 38(4) requires a Scottish

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Secretary to give effect to the guidelines, and if he does not do so the Secretary of State will be able to direct him to do so under the general reserve power in Clause 36.
The noble Lord, Lord Drumalbyn, poses the question to me that if the Scottish Secretary does not choose to obey a directive, what then? My reply is that I do not see the adversarial difficulties which the noble Lord, Lord Drumalbyn, envisages. I see instead an alternative scenario. I think that the Scottish Secretary will engage in dialogue with the Secretary of State for the day. May I give an example of the present position as the Scottish Office deals with local authority rate support grant? There are a series of meetings, and the local authority representatives meet with the Secretary of State of the day, or his representatives. One cannot always say that total accord prevails but neither, on the other hand, could one say that an adversarial difficulty sustains in any permanent way. In my view, the inherent authority of a Secretary of State will certainly be a very important factor in that kind of on-going relationship.
Might I explain how the Government see the position regarding Amendments Nos. 149 and 151. We think that they are less suitable for two reasons. First, the proposed new subsection (7) of Clause 38, which recasts the duty of a Scottish Secretary in relation to the guidelines, uses the expression "conform with" rather than "give effect to" as in the current subsection (4), which of course is deleted by Amendment No. 149. The words "give effect to" were carefully chosen. They reflect the fact that the guidelines will not be given by the Secretary of State direct to the SDA, or the HIDB, but to the Scottish Secretary. It will then be necessary for the Scottish Secretary to translate these guidelines into directions to the bodies concerned. A positive action by the Scottish Secretary is therefore required and, in the Government's view, this is better expressed by the words "give effect to" than the more passive words, "conform with". The words "give effect to" are also in common usage in other legislation—including, for instance, Section 4 of the Scottish Development Agency Act, which relates to the existing arrangements for giving directions to the Scottish Development Agency.
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The second reason why Lord Drumalbyn's Amendment seems to us to be less suitable is that the procedure in the new subsections (7) and (8) for directions by the Secretary of State to enforce the guidelines is less satisfactory than the procedure provided by Clause 36. Directions under Clause 36 are, like those proposed in the Amendment, subject to an Affirmative Resolution procedure. But Clause 36 arrangements are subject, one might say, to an expedited procedure whicii enables the Secretary of State to act immediately, if necessary before the directions are approved; the direction would t yen lapse after 28 days if not approved by Parliament. The Government think that this is important because enforcement often requires rapid action and could be thwarted by the procedure under Anendment No. 151, which we really have touched upon at this time.
I think I might just re-emphasise the point that I mentioned at the outset of my remarks. I do not foresee the real difficulties and differences of opinion emerging in the way that the noble Lord, Lord Drumalbyn, does, but I can say to the noble Lord that the view of the Government and Parliament will prevail in that sort of extreme situation. I suppose that if one carries Lord Drumalbyn's point to the ultimate, as I think he himself did in one sense, then presumably Westminster would legislate.
Lord DRUMALBYN: I think that perhaps the noble Lord will have realised that my Amendment was drafted before I was aware that Clause 36 was intended to apply to these circumstances. The only point that he has not answered is, what happens if there was not merely a case of the Secretary of State proposing to take action but of his already having taken action which is at variance with the wishes of the Secretary of State or at variance with the guidelines? Can the noble Lord answer that point?
Lord KIRKHILL: I can readily conceive of that type of situation occasionally occurring. I do not think there is any point in denying that this is at least a possibility. I believe that the Secretary of State would ask the Scottish Secretary to reconsider a position which le had adopted which was at variance with a direction. I think that that is all I can say at this stage.
3.9 p.m.
Lord MACKIE of BENSHIE: I am pleased that the noble Lord the Minister has said that the term will be "conform with" instead of "give effect to", which appears to me to give a little latitude. I hope that the Government do not intend to lay down the guidelines for the Scottish Secretary so tightly that he will be unable to vary the total amount of money—which, I accept, should be in conformity with the rest of the United Kingdom—even to suit local conditions. I hope the guidelines will not be so tightly drawn as to allow no room for Scottish initiative.
Lord KIRKHILL: I should mention a point to which I perhaps did not give sufficient emphasis, having read the Official Report, last Tuesday evening. The present guidelines are in the Library and noble Lords might find it interesting to read them; one is not envisaging any substantial departure from the present area of guidelines.
Lord DRUMALBYN: Can the Minister confirm that the guidelines about which he is talking are the guidelines given at the present time by the Secretary of State to the Scottish Development Agency? If so, why should it be for the Scottish Secretary to interpret those guidelines—the guidelines which he will receive and which the noble Lord says will be very much along the same lines—into the form of directions? If the Scottish Development Agency is already receiving these guidelines direct, why cannot the Scottish Secretary simply pass them on?
Lord KIRKHILL: Because the intervening factor is the whole question of devolution. From the Government there is the view that the devolved Assembly must be encouraged to assume its responsibilities and the Scottish Secretary will be in a relationship with the Scottish Development Agency.
Baroness ELLIOT of HARWOOD: If the guidelines are to be drawn up by the Secretary of State and the administration of the guidelines will be by the Secretary in Edinburgh, what will happen if they belong to different Parties? Supposing one is a Conservative and the other a Socialist and they do not agree at all about the guidelines; what will happen
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then? Who will have the authority? I presume it will be the United Kingdom Secretary of State. It will not work if the Secretary in Edinburgh is not prepared to carry out what the Secretary in Whitehall says.
Lord KIRKHILL: The Secretary of State has the last word. I do not mean this in any unkind sense, but we have been over this ground substantially. There is a question of policy at stake here and that question is this: do we draw up everything so tightly that the Assembly operates at the end of an apron string, or do we say to the Assembly, " You are a responsible elected body. Carry out your responsibilities in an informed manner "? The policy choice at this point in my view, but particularly in the Government's view, lies in the second area.
Lord SHINWELL: I am rather puzzled by the argument that my noble friend Lord Kirkhill is using, because it seems that this whole matter can be considered only in relation to the general body of guidelines referred to in the whole provision, and those guidelines cover a great deal of ground. Indeed, I am surprised to find so many points covered by them; I refer to Clause 38, and the Amendment is in relation to that.
I am glad to see the noble Lord, Lord Drumalbyn, nodding in agreement. That being so, let us consider what the functions of the Scottish Secretary are likely to be, whether on matters of industrial development, the provision of funds for the Highlands or any other part of Scotland and a variety of other items which I need not relate because they are mentioned in the Bill. What will happen if the Scottish Secretary wants to take action and discovers that he can take it only under the aegis of the Secretary of State? And what are the functions of the Assembly to be? I regret having to use the term, but it seems that the Secretary of the Scottish Assembly will be a stooge for the Secretary of State; he must not move an inch without the consent and endorsement of the Secretary of State. On Second Reading, I said that one defect in the Bill was that it did not clearly define what the functions of the Scottish Assembly were to be, and I have not since had an answer to that question.

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As we proceed I discover that the functions are very much in the clouds; there is a good deal of crystal gazing about this.
I see my noble and learned friend Lord McCluskey shaking his head in disagreement; he had better be careful lest his head falls off if he shakes it too much. Apart from that, I am not overwhelmed by the learned gentlemen who sit on the Front Bench, with the exception of course of my noble and learned friend the Lord Chancellor.
Lord BROWN: May I—
Lord SHINWELL: I am not quite finished; indeed, I have only just started. I have been off for a few days and have not been able to pay attention to what has been going on in these debates, but I suspect that a great many defects in the Bill have been illuminated during those debates. It is time we had a clear answer to the question of what the Secretary of the Scottish Assembly will be allowed to do. I could not express it more simply and with greater clarity than that. Is it necessary for me to repeat the question? I simply want to know what this gentleman will be allowed to do on behalf of the people of Scotland in matters relating predominantly to industrial development, the disposal or acquisition of industrial premises and so on.
The Scottish Assembly might take a decision to provide more new factories for the purposes of expansion, a very desirable project indeed; but along may come the Secretary of State and say, "You cannot do that". The Assembly Secretary will ask, "Why not?" and the answer will be, "Because you have no right to do it". He may respond by asking, "In that case why did you create this Assembly and why did you go through all the procedure in connection with this Bill?" He would obviously ask many questions and, frankly, I cannot imagine anybody in Scotland—knowing how independent and forthright the Scottish people are and how determined they are to take their own line whenever they think it necessary—being prepared to take on the job.
On the other hand, it may have been settled by now and perhaps we could be given some information about that.
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Perhaps Lord Kirkhill, who deals in this House with Scottish matters, is to be promoted. If so, he has my sympathy because he will have a terrible job—I almost said a hell of a job, but I must not use that language in your Lordships' Committee, so I withdraw the remark immediately. I want it to be established as clearly as possible what the functions of this gentleman are to be. Will he be harassed and embarrassed and pushed around? If so, I hope nobody in Scotland will take the job on.
Lord KIRKHILL: My noble friend Lord Shinwell asks a specific and direct question, but before I reply I hasten to assure him that I am neither being promoted nor as of this moment demoted, although perhaps as the Bill goes on demotion is a distinct possibility. I can tell him that a wide range of devolved matters will be the responsibility of the Scottish Secretary, and I would direct my noble friend's attention to Schedule 10, which refers to legislative matters which will be devolved, and to Schedules 10 and 11, which refer to Executive matters which will be devolved.
3.20 p.m.
Lord HARMAR-NICHOLLS: What bothers me about replies from the Government Front Bench to these points is that when we get to the crunch, to where the real problem is clear, they write it off with an airy phrase that "we have been over this ground before". It is true that we have been over this ground before, but we have had no answer. The problem that we have been over is still unresolved. It bothers me that when we come to specific items like this, the reply is that we have been over the matter before, and that because we have discussed it an answer has been found, and all is well. That simply is not true on this particular issue.
There is another point which I find very worrying, and this has been my fear right from Second Reading. When my noble friend wants to write into the Bill a provision which can be understood, and which would have to be adhered to because it can be understood, the noble Lord speaking for the Government then says, "No, we do not want to do it as specifically as that. We want to rely on constructive dialogue." I have a note of the term "constructive dialogue" as used by the

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noble Lord. That is all very well if one can be certain that the people who will have the dialogue will each want to be constructive. But I have produced sufficient evidence so far, as have many of my noble friends, to show that there are many people in this scenario who have made it clear that they do not want to be constructive. They do not want this plan to be the ultimate; to some extent they do not want it to be a success.
I recall the supposedly amusing story about the chap in the Midlands pub. He said, " I am going home now, and if my supper isn't ready there'll be hell to pay, and if it is ready I shan't bloody eat it." If we get people approaching this problem with which we are now concerned in that spirit—and I assure your Lordships that this possibility is abroad; they are not trying to hide it; they make their feelings perfectly clear—then it is Parliament's duty, in anticipation of that possibility, to be as specific as it can be in order to remove the reliance upon a constructive dialogue, which is not likely to be possible. Instead, Parliament should spell it out in the beginning so that people will know where they stand.
It is because of those risks that the guidelines must be fairly specific. This may well help the Secretary of State and the Scottish Secretaries because they would then be administering a provision which Parliament had put into the Bill. They would not have to withstand the charge that they as persons were being difficult. If the guidelines were fairly specific it would also get over the problem in which, if there was a nationalist majority or a socialist majority in the Assembly, and a Conservative Prime Minister at Number 10, it would be said that one person or another was being ideological about what he wanted to do, instead of being impartial and objective. It is because all those matters I have mentioned are very real risks that I believe we must be more specific than the Government want to be, judging from the impression given by the noble Lord.
I expect that the noble Lord, Lord Brown, is to speak in a minute. The other day he was speaking on what he thought people in industry do when faced with the kind of dilemma I have just described. I think that the noble Lord, Lord Brown,
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will confirm, when he speaks, that in industry when one insures against fire one does not insure expecting fire but because there is a possibility that it will break out and one wants to be covered. I assure the noble Lord on the Government Front Bench that there is a real risk that fire will break out, and I urge him to arrange all the protection he can by way of getting himself insured against the bigger explosion that will flow from it.
Lord MACKIE of BENSHIE: I should like to ask the Minister to pay close attention to the noble Lord, Lord Harmar-Nicholls, because there is no one who knows more about the spirit and the mechanics of obstruction than he does.
Lord BROWN: With great respect, I think we are making a bit of a meal of this. I am a member of the Industrial Development Advisory Board, which is a statutory body which advises the Secretary of State for Industry under the 1972 Industry Act. So I have a little insight into the operation of that Act. Much of the money which we are talking about, which will come within the aegis of the Scottish Assembly when it is set up, will come through that Act. At the moment there is a Scottish Advisory Committee helping the Secretary of State for Industry under the Industry Act and it operates on guidelines, as do other regional advisory bodies and the Industrial Development Advisory Board. Am I not right in assuming that the real intention of all that appears in this Bill, with reference to the money which will arise under the 1972 Industry Act, is to maintain the existing guidelines as they have been operated for two or three years now, and simply transfer the authority that at present rests in the Secretary of State for Industry vis-à-vis Scotland to the Secretary of State for Scotland?
Parliamentary draftsmen have to spell this matter out at enormous length; we know that it is necessary. The full meaning of what is said is simply to put the Secretary of State for Scotland in the same role as that occupied at present by the Secretary of State for Industry, and for the moment, at any rate, the guidelines will be exactly as they have been for the past two years. If we want to see what is likely to happen in Scotland we had better have a look at current practice.

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That seems to me to be the full intention of these clauses, and I think that the debate is being excessively complex.
Baroness ELLIOT of HARWOOD: I should like to interrupt here. I perfectly understand what the noble Lord, Lord Brown, has said. The present situation is perfectly simple. There is one United Kingdom Government, there is one Department, and there is one Minister for Industry (or whichever Minister is giving the guidelines), and there is one company, or one industrial situation, being governed by one Parliament. But what we are talking about here is quite different. We are talking about two authorities. The difficulty lies in how to reconcile what is happening in Whitehall with what is happening in Edinburgh, when there is a different set-up, with a Parliament on the one hand and an Assembly on the other, and different people dealing with the matter. Today the situation can be handled easily. For years I have operated things in Scotland with directions mostly from St. Andrew's House, not from anywhere else. That is quite easy because there is only one authority. Now we are talking about two, and this is the complication.
Lord KIRKHILL: I do not know whether the noble Lord, Lord Campbell of Croy, wishes to take part in the debate, but as it appears to me that we are discussing the question of guidelines in considerable depth, I should, for the record, say to my noble friend Lord Brown that, while he is quite correct in saying that guidelines meantime exist—and I have been saying that earlier this afternoon—I do not think that it is absolutely correct to say to the Committee that the guidelines presently in force can be seen as comparable to those which exist in relation to, for instance, the Industry Act. I think it is probably necessary to be clear about that at this stage, in case we have confusion on the point. I should say that the Scottish Development Agency is not now, and will not be after devolution, in the business of giving selective financial assistance to industry under the terms of Section 7 of the Industry Act 1972. This is a matter for the Government, and it is now, and will continue after devolution to be, administered in Scotland by my right honourable friend the Sec-
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retary of State for Scotland. I thought it worthwhile to say that at this stage.
3.29 p.m.
Lord CAMPBELL of CROY: This has been an interesting debate. I take issue with the noble Lord, Lord Kirkhill, if he did at one point say that we had been over this ground before. It could have been only a part of what we have been discussing. We have not been over the question of guidelines before, for the simple reason that late on our last Committee day—at 10.40 p.m., which is comparatively late for this Committee—the noble Lord, Lord Kirkhill, gave a long and very carefully considered statement (which he told us was such) on the guidelines, and what the Government's views were as to the form these guidelines would take and how they would operate. Today, in his first or second intervention, I think he said that with the Scottish Development Agency (the SDA) the guidelines could be expected to be very similar to the present guidelines. That again was an interesting piece of new information, and I am sure that all those who were going to take part in today's debate have studied—as the noble Lord encouraged us to do—exactly the words he used in his statement last Tuesday.
I took part in the various stages of the Bill which set up the Scottish Development Agency and I remember our talking about its guidelines. Since then its guidelines have appeared and are available and can be seen in the Library. We now know that that is the sort of guidelines which, under this Bill, the Secretary of State for Scotland would issue in relation to that Agency. The statement which the noble Lord made on Tuesday evening was not only new, in as much as it was the first time, because of the effect of the guillotine in another place, that the Government had an opportunity of stating its opposition under this clause, but we had also been waiting for it. We had been wondering how the Government were proposing, in the way in which they are suggesting that devolution should take place, to reconcile the unity and the central control of the economy of the United Kingdom, efficiency, devolving certain decisions to the new Executive and at the same time maintaining fair competition with full allowance for regional incentives and industrial development.

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The formula which the noble Lord has given to us shows that there will not be very much difference so far as the SDA is concerned, and in his statement in column 1782 of Tuesday evening he stated—and it confirms what those of us who have been trying to interpret the Bill have thought—that in any case the Secretary of State is going to have powers of direction, because he said that Clause 36(1) empowers—
"the Secretary of State to direct the Scottish Administration to use their powers to secure compliance of the guidelines".
So if there is going to be a serious argument the guidelines are going to amount to a direction from the Secretary of State.
All this arises because of the attempt to divide responsibility, and where the SDA is concerned—I shall give one example—it is going to be the Assembly and its Executive who are going to be able to appoint the members of the SDA; but it is the Secretary of State who, through these guidelines, which are tantamount to directives, is going to say what will happen. It is that kind of extraordinary division of responsibility for the SDA which is bound to cause confusion. It will certainly be very difficult for members of the public in Scotland to understand, and I believe it will also be difficult for those who are trying to operate this Bill to understand.
More and more am I coming to the conclusion that a great many people, and not only on this side of the House, will be somewhat relieved if this Bill never has to be carried out, because they can come forward and say to the people of Scotland, "We made an effort, we put forward some proposals, but the fact is that the proposals are almost unworkable and certainly extremely confusing, and they might not be understood by the man in the street". There could be relief in many parts of your Lordships' Committee if the Bill in this form did not survive the referendum and never had to be carried out.
The noble Lord, Lord Brown, made a very good point. He pointed out that the system of the advisory boards, of which he is a member, is a simple, straightforward one. That, as the noble Lord, Lord Kirkhill, said when he followed, does not apply to what the SDA does;
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that is, giving advice to the Secretary of State for Industry on certain kinds of assistance to firms. I would point out that in fact the Secretary of State has not always accepted the advice. There have been some notable occasions when Secretaries of State have gone ahead—I think in almost every case disastrously, with grants and loans, against the advice of the advisory board. Not only does the Secretary of State not have to follow the advice given by the board; he does not even have to give reasons. We understand the reason for that; it is because of the confidentiality of companies' financial situations and so on.
The root of this trouble is the way in which the Government are proposing to divide responsibilities in this system of devolution. It is not just a matter of decentralisation. If it were just decentralisation that would be different. It is devolving to a new legislative body, and at the same time having two Executives, and it is the confusion between what the two Executives are supposed to do, which is apparent not only in your Lordships' Committee now, when we are trying to interpret this clause, but I am sure would in practice cause not only confusion but clashes between the new Executive and the Assembly on the one hand, and the Westminster Parliament and the Government of the United Kingdom on the other. I return to what I said, that everything we are discussing under Clause 38 is subject to Clause 36, so that the overriding powers of the Secretary of State appear to mean that he will not only give guidelines but will enforce them.
3.36 p.m.
Lord KIRKHILL: I seem to have said something which I did not think I had said—and that is not a remark which I am fond of making. When I was speaking earlier of the fact that we had been over this ground before, I certainly did not mean to suggest that we had thought at any great length on the question of guidelines. It was really an attempt to pick up the point on the question of whether we shall tie up the Assembly absolutely tightly at each point or whether it will have a very loose operating rein. It was at that point that I used the phrase, so I should just like to re-emphasise that at this stage.

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I think we have strayed significantly from guidelines in the course of our debate. Although I spoke at length the other evening, it might be helpful to the Committee if very quickly I pinpointed again the functions of the SDA. These functions are split broadly into three groups. In the first group there is the factor of environmental and factory building functions. These include the powers to provide sites and premises for industry and to develop and improve the environment, the power to rehabilitate derelict land and the power to acquire and dispose of land.
In the second group there are the industrial investment functions of the Agency. In the third group we have powers to give selective financial assistance to industry as the agent of the Secretary of State under his direction, and I would refer the Committee to Section 5 of the Scottish Development Agency Act 1975. In fact, this power has not been used so far. In addition, the Agency has certain powers in relation to statutory undertakers and Crown lands. While I do not want again to expand these points, as I thought I dealt with them in depth last week, I think it is perhaps useful to remind your Lordships' Committee that these are the broad functions of the Scottish Development Agency.
Lord O'NEILL of the MAINE: I wonder whether someone who has had a little experience of devolution might say a word or two on this important matter of industrial development. When some people have suggested that there would be great difficulties if you had a Party of one colour in power in London and a Party of another colour in power in Edinburgh, might I say that when 13 years of Tory rule was coming to an end I must admit that, having had a very pleasant relationship with the noble Lord, Lord Home of the Hirsel, I was worried about the future. But, for the record, might I say that when the Labour Party came to power I had nothing but the greatest co-operation, particularly from the noble Lord, Lord George-Brown, in the Department of Economic Affairs. Unemployment knows no Party differences. I forecast that, when the Assembly comes into being in Edinburgh, the Party in power in London, be it Labour, Conservative or Liberal, will be falling over itself to try to deal with
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unemployment in Scotland; and, if it does not, it will suffer.
So might I very briefly plead with your Lordships? It could be argued that we should have no Assembly in Scotland at all; but, if we are going to have an Assembly, then for heaven's sake give it some power to do some good for Scotland. It should not be cribbed, cabined and confined: it should be given an opportunity to succeed. I remember so well, when the British Industrial Development Office was set uh in New York with a Scottish chairman and a Northern Ireland vice-chairman, the marvellous work it did in attracting American industries to Scotland and Northern Ireland, and indeed to other parts of the United Kingdom. This Bill must be made to work, and I do so hope that we shall not dispute over too mar y details, because the whole essence of the British character is to make something work. I feel sure that this will happen, and I am merely saying these words because I have had this experience and I know that, when it comes to the point, all British people will want to try to deal with unemployment—and this is what we are in effect talking about today.
Lord SHINWELL: The noble Lord, Lord O'Neill of the Maine, has pinpointed the whole issue, and it is that, i' there is to be a Scottish Assembly, it must be vested with power. That is what I understand the noble Lord to have said. But how can we argue that in the context of the Bill or of the clause which is now under review? How can we argue that the Scottish Assembly, when created, will be vested with power if, first, guidelines are to be prepared by the Secretary of State and, secondly, the guidelines can be operated satisfactorily only within the decision of the Secretary of State, which may be in conflict with the views of the people in Scotland and which, therefore, the Secretary of the Scottish Assembly will have no power to operate? Is that not the position? I agree that, if there is to be a Scottish Assembly, it should be vested with power. The question which I ventured to pose—perhaps I did not pose it with the clarity required, but I am now posing it—is: If there is to be a Scottish Assembly, is it going to be vested with power or is it going to operate under the direction, generally speaking, of the Secretary of State?
Lord HARMAR-NICHOLLS: I come back because I think the contribution made by my noble friend Lord O'Neill is possibly the most dangerous we have had, because it is the most effective. It was reasonable, it was based upon practical experience of a devolved Parliament and it carried with it all the weight that goes with those two attributes. But would remind your Lordships and my noble friend, too, that I do not think we are living in the same world that existed when my noble friend was the Prime Minister of Ulster, and I think we must take into account the fact that it is a different world. My noble friend put on the record how he found that he was able to work just as amicably and just as effectively with a Labour Government as he had previously worked with a Conservative Government, who were more in line with his thinking. I understand that; but I wonder if my noble friend could now say, bearing in mind the people who are seeking power in Ulster, the views that they have expressed and the outlook that they have today, which is there and seems to be growing, that they would be able to work with the same amicable, constructive and objective outlook as he found when he was there.
I do not believe we ought to approach this vital Bill on the basis that it is in 1945 or 1950, or even 1960. We are producing this Bill in 1978, when a variety of extremist, dangerous, distorted outlooks are abroad. I believe that, in the light of the situation for which we are now legislating—we must take into account, of course, my noble friend's experience, but we must also take into account the fact that it is a different era, in different times—and in order to avoid the kind of conflicts which can grow, we have got to write into this Bill so far as we can, if we are to have it, something which will avoid the conflict which will come from people on the spot making decisions which may be in conflict with the views of the people in charge at a particular time.
Lord DRUMALBYN: This Amendment has gone a very long way beyond what I had intended. I should like to make only two remarks at this point. The first is that I hope we get a First Secretary of Scotland of the calibre of my noble friend Lord O'Neill of the Maine. I think things will go very much
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better if we do. The second is that I think the rest of the debate can easily be left to the Question, Whether the clause shall stand part? There are matters which will arise, obviously, on that, because I regard this as the central economic clause in the whole Bill. It is the only one in which you can gather together, as the noble Lord, Lord Kirkhill, has already done in one speech, all the various economic elements affecting devolution. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
3.46 p.m.
Lord DRUMALBYN Lord DRUMALBYN moved Amendment No. 150:
Page 20, line 23, at end insert (" and the Secretary of State shall not appoint the Scottish Secretaries until such an order or such orders have been made in relation to the exercise by a Scottish Secretary of the powers referred to in subsection (1)(a), (b) and (c) of this section ").
The noble Lord said: This is an Amendment which I can move with speed and brevity. It is simply to the effect that at the end of line 23 there should be inserted the words:
"and the Secretary of State shall not appoint the Scottish Secretaries until such an order or such orders have been made in relation to the exercise by a Scottish Secretary of the powers referred to in subsection (1)(a), (b) and (c) of this section".
This seems to me mere common sense. The fact that guidelines are already in existence gives me every confidence that it will in fact happen that the guidelines will be available before the Scottish Secretaries are appointed, and the only question is whether it is a good thing to put it into the Bill. I beg to move.
Lord KIRKHILL: The Government think that this Amendment, moved by the noble Lord, Lord Drumalbyn, is a rather extreme remedy. It would indeed be quite unworkable, as Scottish Secretaries will need to be appointed in the run-in period following the elections and before the actual transfer of executive powers takes place, including the powers in relation to the HIDB and the SDA which are set out in Schedule 11. Moreover, it would not be sensible to pick out guidelines among all the various preparatory steps which have to be taken before devolution can be implemented effectively as a statutory prerequisite to appointing Scottish Secretaries. The Government may well find it desirable—indeed, that

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is not a strong enough assertion: the Government would find it desirable—to have some consultation with the shadow Scottish Administration before final details of the guidelines are established. But I give the noble Lord, Lord Drumalbyn, this assurance, and I think the Government fully accept this position: that there will be absolutely no danger of an initial period during which Scottish Secretaries are able to act unfettered by guidelines. I give that formal assurance to your Lordships' Committee.
Lord DRUMALBYN: I regard the noble Lord's answer as highly satisfactory, because it at least implies that there will be consultation with the Scottish Executive before the guidelines are actually given. If that is so, that is all to the good. I had envisaged a situation where the same guidelines would be handed out as are handed out to other parts of the Kingdom on similar matters, but if there is going to be a possibility of consultation and modification, and not mere explanation to the Secretaries of State of what their job is going to be, that is fine. But I see the noble Lord is not so sure.
Lord KIRKHILL: I do not wish in any way to mislead your Lordships' Committee; nor would I wish the noble Lord, Lord Drumalbyn, perhaps to take the wrong nuance from my remarks. Quite a lot of work has already been done on the guidelines, and I believe—indeed, I affirm—that there will be consultation. I am not prepared to state that that would necessarily lead to modification. It will certainly lead to explanation, but I do not think that I would wish to go further than that at this point.
Lord DRUMALBYN: This was obviously a probing Amendment. I find the noble Lord's explanation reasonably satisfactory, and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
[Amendment No. 151 not moved.]
3.50 p.m.
On Question, Whether Clause 38 shall stand part of the Bill?
Lord DRUMALBYN: As I have said, I regard this as the central economic
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clause and I think one must make some observations on it. May I start by referring to what the noble Lord, Lord Kirkhill, said on Tuesday night. He said:
"If these functions,"—
and he was referring to the functions of the Scottish Development Agency—
"were carried out in such a way as to provide assistance to industry on more generous terms than those available elsewhere it would undermine the Government's regional policies and adversely affect industry in other parts of tle country. The guidelines will ensure that this does not happen. The wording of the subsection covers these three functions in the constituting enactment".
The observation that I should like to make on that is that it seems to close the door to any sort of special treatment for Scotland. I would not deny that, as one of the main objectives of this Bill is to maintain the essential economic
unity of the country, giving the Scottish Executive discretion within the same rules as apply to the rest of the country—always excepting Northern Ireland—seems perfectly reasonable. But the fact remains that many Scots, whether in favour of devolution or not, strongly believe that Scotland needs special treatment, even to hold her place in the economy of the United Kingdom. That means developing new industries, regenerating old ones and so forth.
In that regard, what the noble Lord, Lord Kirkhill, said on Tuesday night will act as something of a cold douche upon the economic aspirations of Scotland. I do not think that the Scottish people understand the close constraints that are to be laid on them and, at this stage, perhaps, I may say to the noble Lord, Lord Shinwell, that on this whole question of the guidelines—this whole question of the Scottish Development Agency—it is entirely outside the capacity of the Assembly to legislate or even, I imagine, to make statutory orders and instruments. What we are talking about here are guidelines to be given by the Secretary of State to the Scottish Secretary. There may, because of the structure of this clause, be different Scottish Secretaries for different guidelines to, let us say, the Scottish Executive.
There are a number of special points that one ought to ask about in connection with those guidelines. I wonder whether the noble Lord will tell us how

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the distribution of industry policies will be administered so far as Scotland is concerned. Can the noble Lord give an assurance that the Departments of Trade and Industry in London will continue to encourage industries to open up or to expand in Scotland with at least no less encouragement than is given them to go to the disadvantaged and depressed parts of England? I take it that the Departments of Trade and Industry will still be in charge of the distribution of industry even though they will work through the Secretary of State so far as Scotland is concerned.
The advantage of having a Scottish Secretary at all to deal with Scottish industrial problems is that he will, we hope, be able to give the matter his undivided attention without having to respond to three-line Whips at Westminster and attend Committees in Whitehall; but there are difficulties in transferring powers from the Secretary of State to a Scottish Secretary without making the Scottish Secretary responsible to the Assembly in the exercise of those powers. He becomes, as it were, the independent agent of the Secretary of State. The Assembly has no legislative power over the Scottish Development Agency or over the Highlands and Islands Development Board, if I understand the matter correctly. If I interpret the Bill aright, the Assembly cannot even approve orders made by the Scottish Secretary in regard to those bodies.
What influence will the Scottish Secretary have, then, over the Scottish Development Agency? The Scottish Development Agency sets itself the task of uplifting and regenerating Scottish industry. It is worth recording from its last year's report—the present year is not yet available—that, in the year just ended, the agency was expecting to spend or to commit some £15 million on investment, £22 million on factory sites and buildings and £14 million on land renewal. The Scottish Development Agency is essentially a hived-off agency of Government dealing with the promotion of industry and the provision of factories and services for industry as well as urban and land renewal. It is not subject to the day-to-day control of Parliament. It inherited the work of the Scottish Industrial Estates Corporation and developed it further. It now
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acquires sites and builds both advance and bespoke factories, modernises, and sometimes subdivides, existing premises and acts as the building agency of the Highlands and Islands Development Board. It is expected to maintain rentals in line with rentals in other parts of the United Kingdom. But its report says that it is now empowered, at its own discretion, to grant rent-free periods of up to two years to new tenants. It appears also that longer periods of up to five years may now be granted with the approval of the Secretary of State.
Perhaps I may ask whether it is the Secretary of State or the Scottish Secretary who is to give this approval for further rent-free periods to tenants of the Scottish Development Agency in the future. It seems that the functions of the Scottish Development Agency (which used to be functions of the Scottish Industrial Estates Corporation) are devolved functions which are conferred on the Assembly under Schedule 10, Part III. Whether this means that it will come under the day-to-day scrutiny of the Assembly, I do not know. I take it that that will be for the Assembly to decide.
Then there are the functions transferred to the Scottish Executive under Paragraph 7 of Schedule 11. These manifestly include the appointment of the members of the Scottish Development Agency and the other powers listed under that paragraph. Schedule 11, I should mention, deals with matters within the powers of the Scottish Executive but not within the legislative powers of the Assembly. There are, in addition, the activities of the National Enterprise Board and the distribution of industry activities. No doubt all these will impinge upon the Scottish Development Agency. I am not certain that the Scottish Development Agency is going to be happy with the amount of guidance that is going to come to it from various quarters.
One conception, I take it, of the Scottish Development Agency was that it would act more or less as an independent body exercising its own judgment—as an investment bank, if you like, and a development and construction agency. I found it so difficult to construe Schedule 11, Paragraph 7 that I have put down Amendments Nos. 269 to 277 inclusive in order to get an explanation of them. If the

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noble Lord cares to let me have a copy of his "Notes on the clauses" or otherwise help me in this way, it will certainly save a good deal of time. For example, I do not intend to go through all the 11 linears of paragraph 7 on page 69, but let me quote one of them as an example. Linear (iii) says:
"the powers under section 2(7) so far as exercisable in relation to the functions specified in section 2(2)(a) to (c)"
I will pass by Section 2(7). The point I am making here is that the Bill itself is exceedingly difficult to construe. The various provisions are divided up in a most strange manner and it is difficult to see how the Bill will operate in any particular circumstances. Presumably the relevant Scottish Secretary will take the place of the Secretary of State in authorising drafts—that was the matter I was referring to. But, if your Lordships will look at paragraph 47 of Schedule 16, you will find that the Scottish Development Agency does not have to submit its annual report to the relevant Scottish Secretary in pursuit of Section 5, which contains the power to give selective financial assistance. That seems to me wholly wrong. Admittedly, the Scottish Development Agency has not got control of this—does the noble Lord wish to intervene?
Lord KIRKHILL: No, I do not think so, because the noble Lord is just coming on to that point: Section 5 stands reserved.
Lord DRUMALBYN: But how is the Scottish Secretary or, for that matter, the Assembly to have a supervisory role over the Scottish Development Agency in its entirety? It must do so: how is it to reach appropriate decisions if it does not even know what special financial assistance is being given from other quarters?
This is the sort of thing one finds so extraordinary—there is no cohesion in the whole thing. That brings me back to Clause 22(3) and the powers to be exercised by both the Secretary of State and the Scottish Secretary. On some matters under the Scottish Development Act, the Secretary of State alone is to exercise power—that is on selective financial assistance and promoting industrial democracy—and other matters are stated to be within the powers of the Scottish Executive. There is, for example, the power to make
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grants or loans; but these powers can be exercised both by the Secretary of State and by the Scottish Secretary—or is the Secretary of State going to deprive himself of the powers by way of the guidelines and transfer them entirely to the Scottish Executive? Perhaps the Minister will tell us that.
What about the money to finance these activities? The guidelines no doubt will have a good deal to say about that as well as imposing limits. Will the Scottish Industrial Estates side of the Scottish Development Agency continue to be financed by a separate Vote in the Estimates, like the corresponding English and Welsh bodies, or will it be financed through the Assembly?
Section 12 provides for the Secretary of State to determine, with the approval of the Treasury, the financial duties of the Agency and different determinations may be made in relation to different functions and activities of the Agency. Is that still to he done by the Secretary of State or will it be done by the Scottish Secretary with the approval of the Treasury? The whole thing is a most extraordinary muddle. Will it be the Assembly which will decide how quickly the £200 million, which is the present limit on borrowing, is to be drawn down?— that again relates to the Scottish Development Agency. If more is needed, it will certainly have to be voted by Parliament before it can be increased to £300 million.
Amid all this confusion and division, do the Government really think this is going to work? This is the reason why I am speaking at this time, because we are talking here about guidelines coming from one direction, but there are guidelines coming from other directions and there is overlapping of functions. One thing is quite certain: an extra tier is being inserted in the echelons of Government and it is very difficult to see exactly what that extra tier is going to do.
I shall say just two things about the Highlands and Islands Development Board provisions. The provisions are relatively simple because the activities of the Board are restricted and the population that it covers is relatively small. I would only emphasise once more that it is quite unreasonable that the financial assistance which section 8 of the Act empowers the

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Board to give in accordance with arrangements approved by the Secretary of State and the Treasury should be on the same scale— if there is a scale— as that which applies in other parts of the United Kingdom. That was not what the Highlands and Islands Development Board was set up for. It was specifically set up in order to enable it to get preferential treatment.
Perhaps the noble Lord can tell us what the guidelines now are in respect of the Highlands and Islands Development Board. It would he a pity if the purpose of the Highlands and Islands Development (Scotland) Act was frustrated. That purpose was undoubtedly to secure special treatment for the Highlands and Islands. I hope that these remarks of mine give some indication of how difficult. It is, in a clause which merely deals with giving guidelines, to bring together—and it is the only opportunity in the Bill to bring them together—the economic impact of this Bill on the Scottish Assembly, the Scottish Executive and Scotland itself.
4.5 p.m.
Lord VAIZEY: I have listened with great care to the Front Bench and to the Opposition throughout this Bill. I have always thought that this clause and Clause 40 are central to the Bill, because it seems to me this is likely to be the real area of dispute if the Assembly is set up. There may well be debates between the lawyers as to whether or not one can appeal to this, that or the other court; but I should have thought that for the ordinary citizen that is going to be rather esoteric. This area really represents the central question, because undoubtedly the pressure for some form of home rule for Scotland has had a great deal to do with the pressure for some resettlement of the economic condition of Scotland, and Clauses 38 and 40 deal specifically with the economic situation.
I agree with the noble Lord who has just spoken that Clause 38 is central, and I should have thought that Clause 40 was equally central. If I may speak with due reference and respect, I think that in Clause 38 the Government have probably got it right. But I say so with a certain amount of hesitation because if this is to be the beginning, as one supposes it is,
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of a whole series of Bills which are likely to come before Parliament dealing with the devolution of various parts of the Kingdom and with the resettlement of our Consitutution, I suspect that we may be on the beginning of a slope which is a little dangerous.
The reason I say that—and if I am here when Clause 40 is discussed I shall have a similar remark to pass then—is that I am slightly alarmed by the fact that the guidelines, as I understand it, are going to be drawn up in very general terms. They are subject to some forms of resolution in the other place and in this Chamber, and we all know what that means: this is to be largely drawn up within the Civil Service, to be settled entirely within the Whitehall machine as to the economic development of Scotland.
I would ask your Lordships to consider this position. There are going to be three major sets of elections in Scotland: one will be for the European Parliament, whatever that may do; the second will be for Westminster, and the third for Edinburgh. It is quite clear that Edinburgh is concerned with health, housing, planning and education, except for the universities. Therefore the only job which is of domestic interest that the MPs elected from Scotland will have to do in Westminster will be concerned with the economic powers of Westminster with respect to Scotland and the rest of the United Kingdom.
The trouble with this clause is that it leaves the matter rather fuzzy, because some of these powers are within the power of the Executive and the Executive is not answerable to the Assembly. That is the first area of fuzziness where one can imagine there will be conflict between the Assembly Members and the Members of Parliament from Scotland in the other place. Secondly, these powers will be exercised quite largely "privately", if I may say so; that is to say, they will be within the authority of the Civil Service and the Treasury. In other words, the economic powers with respect to Scotland which the Scottish people are very agitated about and which are the basis for the demand for this sort of home rule, will in fact fall between two stools. The Scottish MPs will not be able to question adequately in another place; and the

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Members of the Assembly will not be adequately empowered to question within the Assembly.
One listens with great respect to the extraordinary brilliance of the noble Lord on the Front Bench, but, if I may say so, he made a mistake early on when he said that the Assembly could discuss what it liked. I listened with great interest at that stage, because Clause 38 is precisely the area where the Assembly will have Motion after Motion put down, certainly by the minority Party, the Scottish National Party, and occasionally by the majority Party, about the extraordinarily bad economic conditions of Scotland, which will have to be redressed by the other place exercising its powers under the Constitution, which, quite rightly, this Bill leaves in the hands of the other place. This seems to me to be a built-in recipe for conflict.
There are two possible solutions. One is to give economic powers to the
Assembly, to which I should be opposed. The other is to draw these lines much more clearly, in such a way that the Scottish Assembly cannot discuss issues of this kind. I think that Clause 38 gets it right, which is why I, a non-Scot, am venturing to speak at this stage, almost without any qualifications whatsoever, when, so far as I can discover, everyone who has already spoken has been of impeccable Scottish origin. Nevertheless, I see that this will be the cause of immense practical difficulty throughout the next 10 or 15 years, once the Assembly comes into existence. The ordinary electors in Scotland—the ordinary businessmen and trade unionists will not know whether to go to their Assembly man or to their Member of Parliament, to complain about the problems which are faced in Scotland.
I shall have roughly the same kind of point to make in respect of Clause 40, which raises similar difficulties. But I honestly feel that, in this area, the Government would be right—if they chose to amend this Bill in any respect whatsoever—to draw the line somewhat tighter, rather than more widely. Moreover, so far as I know, the term "guidelines" is a new one in an Act of Parliament, certainly in a major constitutional Act of Parliament, and the Government ought to be a little more specific and the procedure
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should be more formal, if we are to get this right and avoid conflict in the future.
Baroness WARD of NORTH TYNESIDE: I feel, as a very ordinary English woman, that I really ought not to be taking part in this debate, but I certainly want this devolution Bill to be as helpful and as satisfactory as it can be to the Scots. My noble friend seemed to be moving an Amendment, about which I did not understand a word because I could not hear what he said. He went on talking and talking, and I came to the conclusion that, as an English woman, I had better get up and say something.
I quite agree about the difficulties of unemployment, both in Scotland and also in my own part of the world, the North-East coast. But if it is true that what we are discussing is giving extra money to Scotland and perhaps depriving my part of the world of help—I think that one of the noble Lords on the Front Bench opposite said that this might be so —then I certainly would not support that. We in this House must try to De as fair as possible about the terrible unemployment situation, both in Scotland and in my part of the world. But when my noble friend introduced this very complicated Amendment he said, so far as I could understand it, that Scotland wanted preferential treatment. I am not in favour of that. I want fair treatment for Scotland and for my part of the world, as well as for England as a whole.
It is very worrying when an English Member, like myself, has to rely on Conservatives speaking from safe Conservative seats, with no real unemployment. I could not possibly let Scotland get preferential treatment without anybody speaking up for my part of the world. I may be quite wrong but, to me, what we are discussing is absolutely unbelievable. I want to know specifically, before anything happens to my noble friend's difficult Amendment, whether the Minister who is to reply will give an assistance that economic assistance shall not go to Scotland, to the disadvantage of my part of the world. I certainly would not stand for that.
Thank goodness, I have never had anything to do with local government! I have always been on the political side in another place. But I want to know quite directly

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from the Minister whether the Government are to give more money to Scotland—to the Assembly, to Edinburgh or whatever it may be in Scotland—to the disadvantage of Northumberland or Durham, because if that is intended I shall get up and make a row, and, believe me, when I start to make a row I can make a real row.
So I just want to know quite specifically from the Minister, who I think said that if one of these Amendments was passed it would be to the disadvantage of some other areas, and to have it in black and white in Hansard, that my part of the world will not have money taken away from it so that it can be handed over to Scotland. I do not think I should go on, because I am probably getting in a frightful muddle. But I always want to stand up for my part of the world, and that is what I am doing now.
4.18 p.m.
Lord WIGG: I have the greatest sympathy with the noble Baroness in fighting for her part of the world, because, in my own time, I have done a bit of fighting for my part of the world. My part of the world is the West Midlands and it has suffered from the same grievous unemployment as her part of the world, and I regret to say that it is still suffering. But, of course, when she says that she wants help for her part of the world, regardless of the consequences to anyone else's part of the world, then I part company, if I may be forgiven for saying so, because the truth of the matter, whether we like it or not—and I emphasise, "whether we like it or not"—is that the United Kingdom, economically and politically, is one or it is nothing.
That is my basic objection to this Bill. I regard it as a piece of political nonsense devised by Sir Harold Wilson, and, later on, by the present Prime Minister, in order to cover up a political difficulty, which may even have passed—that is a possibility here—of the Labour Party being put to rout in Scotland, which would make any possibility of a majority in the other place impossible. I am by nature an optimist, and I thought this morning, when I listened to the local government results in Scotland, that I might come down here to find that there was no meeting this afternoon, because the Government had decided
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to take away this piece of nonsense and strangle it. But pending that, I am going to do my best to play my part in bringing it to a nullity. It cannot be improved. It is a piece of political nonsense and it cannot be expressed better than in this clause.
If one accepts for the moment part of my argument—that the United Kingdom economy has to be looked at as a whole rather than tampered with seriatim on a local basis—then one must take into account a little economic history. Mine is not very deep, having been learned in my adult years as best I could from my own reading, helped by WEA tutors. As I see it, this country's economic decline started just over 100 years ago when, without our noticing it, the United States passed us in the struggle for markets and productive capacity. It was perfectly clear by the end of the 19th century that not only had we been passed by the United States but that we had also been passed by Germany. That process has continued. It has been halted temporarily by periods of prosperity during wars and immediately after those wars, but the inexorable decline has gone on and on, measure it where you like: shipbuilding, the arms race, boot production, textiles.
Therefore we are brought face to face with the ultimate economic reality. Either we can become once again a pastoral country—which is what awaits us if we follow the advice of our friends who have taken us into the Common Market with our hands tied behind our backs, because that has always been the endeavour of our Continental friends—or we can start to rebuild our industries, not in historic terms but in terms that make common sense. Indeed, we must produce goods for markets that can absorb those goods. If we, however, concentrate, under pressure from the noble Baroness and her friends, on building ships, those ships will be tied up from the day that they are launched. They will fetch half the price that they cost to build.
I could give examples of industry after industry. The reason why our economy has not expanded and why productivity has not increased is because often we are producing the wrong things; and often we are producing the right things by out-of-date methods. In order to get it right, we must build up new industries,

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and they can be built up only behind a tariff wall. That is the plain issue which faces this country. If we do not face up to that issue, then, as sure as night follows day, we shall face economic bankruptcy. That bankruptcy might express itself either militarily, which is a distinct possibility, or diplomatically—perhaps that is slightly more " odds on "—or through economic decline, which will result in increasing unemployment, with all the inevitable political instability that that must bring. The noble Baroness knows just as well as I do that a permanent force of unemployed people, particularly young people and especially the young immigrants in this country, will ultimately lead to economic instability.
This Bill does nothing to tackle that problem. Instead it lays down guidelines to be discussed between the Secretary of State for Scotland and the Treasury. It is a contest between Mr. Millan on the one hand and Mr. Healey on the other.I wish that I were so sure of the winner as I am of the winner of the One Thousand Guineas tomorrow. If I were, I should be a lot richer! as I say, the contest lies between Mr. Millan on the one hand and Mr. Healey on the other. Indeed, if the personalities concerned were not as they are, there is another factor. This clause is a typical British clause. It has been designed by the Civil Service. What the Civil Service mandarins want is quite simple: the more you pretend to give away power, the more you make absolutely sure that that power is held even tighter in the hands of the Permanent Secretaries. That is what this clause is about.
So far as the guidelines to be laid down are concerned, not the slightest indication has been given of the form that they are to take. Economic planning is not even a starter. We are going to leave it to the higgling of the market. And what form will that take? Again I come back to the noble Baroness. She is absolutely right; her instinct is fundamentally sound. If Scotland is to be helped—I am not thinking of cash handouts—and the pressures for this Bill, as my noble friend has said, stem from the fact that Scotland wants to be helped because of the gravity of her economic situation, then—I will not say inevitably but the possibility exists that the consequences of that help being given will be found on the North-East Coast, in Liverpool and in the West Midlands.
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Unless those issues are faced up to on a national basis, then I believe that this Bill will become even more disruptive than I thought it would in the first instance.
Therefore on every occasion that she can I hope the noble Baroness will join me in hamstringing this Bill. If she and I were eventually to be Tellers in a Division and were to put paid for ever to the clause, I should be highly delighted.
4.28 p.m.
The Earl of PERTH: I agree very much with what the noble Lords, Lord Drumalbyn and Lord Vaizey, and others who have spoken, have said on the Question that the clause stand part. for it is a clause of enormous importance. I think I am right in saying that in the original Scottish and Welsh Bill, the Scottish Development Agency and the Highlands and Islands Development Board did not form part of the powers of the Scottish Assembly. When that Bill was defeated, considerable pressures developed for the Scottish Assembly to have economic powers, and the sequel was Clause 38. However, we all know that Clause 38, which gives certain economic opportunities to the Assembly, is subject to guidelines laid down by the Secretary of State with the approval of the Treasury.
In the discussion last Tuesday on an Amendment which I moved late in the day, in which I asked that the words "after consultation with the First Secretary" should he inserted, the noble Lord, Lord Kirkhill, gave an extremely full explanation of the content of the guidelines. I am grateful to the noble Lord, and I know that all Members of the Committee will also be grateful to him, for that explanation. The noble Lord made great play on the point—and this, in a sense, takes up what was said by the noble Lord, Lord Wigg, and the noble Baroness, Lady Ward of North Tyneside—that the guidelines should be fair vis-à-vis the rest of the United Kingdom. The noble Lord went on to say that the aim of the guidelines was:
…to avoid unfair distortions of competition by ensuring that assistance to industries is provided on comparable terms throughout Great Britain, …".—[Official Report; 25/4/78, col. 1782.]
That sounds both reasonable and right, but it is very easy to use words. Our view of fairness, particularly having

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regard to what has happened over the last few years, is very different, when we look at it through Scottish eyes, from just the question of whether or not money is being granted to a particular industry.
Let me give noble Lords one or two examples. I will quote three examples of what I have in mind. I could quote 33 examples but time does not allow. Quite often I go from my home to St. Andrew's —not, I am afraid, to play golf but to the university. As I pass the town of Cupar, on my right I see some very large buildings which are more or less derelict. I recall that those buildings were the sugar beet factories of Scotland. What happened? Some five years or so ago the British Sugar Corporation decided that they wanted to close that factory. It was not very profitable for them because, although it had been doing better, it was operating under some handicap. More important, they realised that if they took the quota for the sugar to the English factories it would be a profitable operation for them. So the decision was taken that they would close the factory.
At that moment various Scottish farmers and Scottish industrialists got together and said, "We will make a bid for this factory. We will go on with the job, providing we can have some sugar quota". The British Sugar Corporation—and it really should now be called the English Sugar Corporation—said, "Oh, no. We have a monopoly of the sugar beet in this country granted to us by the Westminster Parliament". So it is out now so far as we in Scotland are concerned. We did not feel it was fair and we realised that the measures had been decided by the Westminster Parliament. That could hardly be called a comparable basis throughout Great Britain.
To give another example, that of forestry, here—like many other noble Lords—I have an interest to declare. Your Lordships will all know that one of Scotland's great potential assets is the land which is available for forestry, and with the development of that asset of course goes great employment. Since the end of the war we have been making slow but steady progress in building up forestry in Scotland. About five years ago, thanks to certain tax concessions and subsidies, it looked as though there was going to be
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a great spurt in the plantings in Scotland. What happened? We did not reckon with the Treasury. The Treasury said, "Oh, look! By doing this you can get certain advantages for future generations, so you must stop it". What did they do? They produced a Paper—I have forgotten whether it was a White Paper or a Green Paper—pointing out how all this forestry was not an economic thing, whether for the Forestry Commission or for others.
Shortly after that we had a debate in this House and in fact it was shown that the whole thing was nonsense; that between the time when the report was written and the time when we held the debate the price of timber had risen and all the economic calculations—and here I go along with the noble Lord, Lord Wigg—the civil servants had done all the sums wrong and the whole process was a nonsense. But the damage had been done; that is to say, the confidence of those engaged in forestry was shaken. Subsidies were reduced and the tax concessions were done away with.
What was the sequel to that? Forestry dropped by some 50 per cent. or 60 per cent. in the next two years of planting and millions and millions of trees which were almost all in Scottish nurseries had to be destroyed. Now there have been some second thoughts on this and forestry is beginning to develop again. That was just another case, and this time it was more the Treasury than the Westminster Parliament which did grievous harm to a natural asset of Scotland. We did not think that was treating us fairly; we did not think that was comparable treatment for the industries of the country.
I think it is important that people should understand these things, and my last example is this. When I go up from Edinburgh to the North I come to the Forth Bridge and there I pay a toll, and every lorry pays a toll, and it is a considerable toll. It is 50p per lorry, so that hundreds of thousands of pounds go into the Exchequer, I suppose, in the last analysis for the benefit of one and all; but it is quite a handicap for Scottish industry to have to carry. Is the position the same, for example, in London? No; what happens in London and the London industry?
Lord KIRK HILL: I regret intervening, which I would not normally do, but I

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think the noble Earl has to accept that there are five estuarial crossings in England where tolls have to be paid.
The Earl of PERTH: I know that there is one in Liverpool and I know that there is one in the South-West, but both of those make my point; namely, what happens to London industry?—which is perhaps where the votes are. Far from having to pay tolls of any kind they get enormous subsidies of tens of millions of pounds from the Government, be they Conservative or Labour, to help them. Is that comparable treatment throughout the United Kingdom?
A noble Lord: Has the noble Earl forgotten the Dartford Tunnel which has quite a considerable toll?
The Earl of PERTH: There may be one exception, but the point I am making is generally right: that tens of millions of pounds go to London subsidies whereas the outskirts of the country, if I may put it in that way, have to pay for I know not what.
Viscount MASSEREENE and FERRARD: I think I am right in saying that per capita the people in Scotland get more from the British Exchequer than the people in England. I do not think the noble Earl is being quite fair.
The Earl of PERTH: That may well be the case, but I am speaking of industry and employment. I am not speaking about the handicaps that we have at a distance on health or education or anything else. That may well be right, but after all South-East England and other parts are much more prosperous and do not have the kind of unemployment that I am speaking about in Scotland.
Having given those examples, as some of your Lordships will know I moved an Amendment that the guidelines should be only after consultations with the First Secretary of the Assembly. As I have already said, the noble Lord, Lord Kirkhill, went into great detail about what the guidelines should be, but he used these words. Having explained what the guidelines were, he said:
"This will, I think, demonstrate that there is no room for effective consultation between the Government and the Scottish Executive about the essential contents of the guidelines".
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Those were his words; that is, that there is no room for effective consultation between the Government and the Scottish Executive about the contents of the guidelines. Having given the examples, I really think that, as an example of how the Government view this, it is tragic. What is the Assembly? A mere creature under those conditions, a puppet of the Secretary of State for Scotland and of the Treasury, and I have shown you how disastrous that can be.
It is quite true that the noble Lord, Lord Kirkhill, went on to qualify what he had said in some degree by saying that in practice there might be some forms of consultation but the words as they stand were, "No room for effective consultation". During the debate today on the Amendment moved by the noble Lord, Lord Drumalbyn, we have heard various qualifications, or something which might give us a little more hope in this regard. The noble Lord, Lord O'Neill of the Maine, told us of his experience in Northern Ireland, but I also agree that there is a considerable degree of muddle about it. On the one hand, people say that they want it tougher, and they include the noble Lord, Lord Wigg, the noble Lord, Lord Vaizey, and the noble Lord, Lord Harmar-Nicholls. They want to put us in a strait-jacket. Others are more understanding, and perhaps the Government, although they have said what they have, may be feeling a little more ready to accept consultation. I hope so.
However, I feel I must say to one and all of your Lordships that this clause is vital, and I believe that the fate of the Assembly depends on how this clause operates. If the Assembly is to have virtually no say in how the Scottish Development Agency and the Highlands and Islands Development Board are to operate, ther I see the day when the Assembly will fight by all means in its power, and I think quite rightly, to achieve something of economic power in those areas. If, on the other hand, it turns out in practice that there is consultation between the Assembly and the Westminster Parliament, which is the Secretary of State for Scotland and the Treasury, and that the Assembly, the Scottish Development Agency and the Highlands and Islands Development Board are allowed their head within reason, then I hope it will be another story.
4.42 p.m.
Lord HARMAR-NICHOLLS: Every speech that is made on each of the clauses confirms the point that the noble Lord, Lord Wigg, and I myself on occasions, have tried to make, that this Bill just does not seem to be on. But I think one ought to treat it as a debate. It was very interesting to listen to the noble Earl, Lord Perth, and he chose three examples to make his point; he said he could have produced 33. The other 30 would have had to have a better base than the three he chose, if he does not mind me saying so. He spoke, first, about the derelict sugar beet factory on his way through St. Andrew's, and he suggested that was because Scotland had had a raw deal. But during that period the sugar beets were being restricted in England too. I had the unenviable task of having to negotiate, through the other place, the Commonwealth Sugar Agreement, whereby as a nation we were committed to a certain quota of sugar from the sugar producing parts of the world. Everybody wanted to do it. But as a result of honouring the obligation we entered into with the Commonwealth sugar producers we had to restrict our sugar beet production, and all producers had to suffer.
The reason I take issue with the noble Earl is that he was suggesting that vis-é-vis the Scotland Bill some way ought to be found which would exclude Scotland from the problems of the United Kingdom policy on Commonwealth sugar. If they had been the only ones who had suffered, his example would have had point, but in implementing a policy which was considered the right one overall, in the interests of our general United Kingdom and Commonwealth policy, both sides of the Border had to make their contribution.
Lord MACKIE of BENSHIE: I do not want to prolong this debate, but there is a slight difference. When you talk about a 100 per cent. cut of all the sugar beet production in Scotland as against a cut of a few per cent. in England, it is an entirely different matter.
Lord HARMAR-NICHOLLS: I know the noble Lord, Lord Mackie, does not want to extend the debate; indeed he accepted this Bill so completely that he would have liked no debate at all; he would have liked it on the Statute Book
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as it was printed, and we see, from the compliments paid to it, what a mistake that would have been. But dealing with the very sound evidence which the noble Earl, Lord Perth, was producing, if it could not be questioned, then it ought to be taken into account. What I am saying —and sugar beet is only one example—is that they had to suffer, if suffer is the word, no more than the English sugar beet factories had to suffer.
Lord HUGHES: If I may intervene, the noble Lord is ignoring the point made by the noble Lord, Lord Mackie of Benshie, that in England sugar beet was reduced, in Scotland it was eliminated.
Lord HARMAR-NICHOLLS: But the point I am trying to make is that, if you give power to the Sugar Beet Corporation —or indeed to the development organisation we are considering setting up now—you give them instructions to deal with it economically and on sound economic grounds. You do not say, "You can do it and make it part of a social service". In eliminating whichever ones they did eliminate, whether in Scotland or in England, they were eliminating the ones which kept them within the bounds of their remit. When that happens both sides are bound to suffer. I am not at all deviating from the sorrow expressed by the noble Earl, Lord Perth, but I am saying that he is giving the impression that when this Bill has passed such things as sugar beet legislation will exclude the pain from Scotland. That cannot be done. That would cause unnecessary dissatisfaction when it was discovered, and there you would get the conflict that some of us have tried to warn your Lordships against. Could I take the second example?
The Earl of PERTH: I should like to deal with the first example, because the noble Lord really does not take the point, although it is made by Lord Mackie and Lord Hughes. The fact of the matter was that the quota was taken away from Scotland and added to the British factories.
Lord HARMAR-NICHOLLS: But the noble Earl will not take my point. I do not deny that in proportion it could be that Scotland gave up a greater amount than pro rata England did.
The Earl of PERTH: They were giving up the whole amount, entirely.
Lord HARMAR-NICHOLLS: But if the noble Earl will try to take my point, in order to make a decision which is uneconomic the noble Earl is asking that legislation should be brought in which will allow, under the guise of it being industrial help, a social service contribution to be given, in this case to Scotland. I should like them to have it. I am merely saying that if, against the economic argument, because it happens to be the major part of the Scottish sugar beet, or indeed the whole of it, you are asking them to make an uneconomic decision, you will not sell that to the English. That was the point made by my noble friend Lady Ward. She said, "I do not mind you being fair on economic grounds, but if you do it on social service grounds I shall want it for my part, too".
It is exactly the same with forestry, of which the noble Earl gave us an example. It was not only Scottish forestry that suffered from the stupid decision the Labour Government made; it was the whole United Kingdom, everybody had to suffer. If the noble Earl is suggesting that under this Bill in some magical way we shall be able to answer the problem for Scotland without creating the conflict that my noble friend Lady Ward spoke about, then I believe he is approaching this the wrong way. The whole of my arguments are not to put Scotland in a strait-jacket, as was suggested by the noble Earl and by the noble Lord, Lord Mackie. I am arguing that in toto this Bill is no good for Scotland. This Bill, as is written, will be dangerous for Scotland. This Bill, as it has been presented to us, will create the conflict that ought not to exist. That is the whole point.
I hope the noble Earl, if he is not prepared to pay heed to the evidence we give, because sometimes some of us talk too much, will pay heed to the evidence he got from the noble Lord, Lord Vaizey, on his own side of the House, who comes here with the reputation of being something of an economist who ought to be listened to. If being on different sides of the House weakens our arguments, I hope that argument will be taken into account. Through the mouth of an economist, whose standing is very high indeed, were
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presented the precise arguments my noble friend Lady Ward and indeed the noble Lord, Lord Wigg, are trying to present. It is not strait-jacketing Scotland; it is not being anti-Scottish. This Bill will not work. I hope, as regards this particular clause, the noble Lord has had enough evidence from all parts of the House that by the time we get to Report some thought will have been given to how it will eventually figure in the final Bill, if indeed we are to have one.
Lord BURTON: I think one of the most relevant points was made by the noble Lord, Lord Shinwell, that this clause and the Schedules confuse him. He was referred to Schedule 10, but I can find no mention of the Scottish Development Agency, nor the Highlands and Islands Development Board, in Part I of Schedule 10. If you go to Part III, there is specific exclusion of the Highlands and Islands Development (Scotland) Acts 1965 and 1968, which were the Acts setting up the Board. In another place, there was an Amendment seeking to insert a new group, to include industrial promotion, in Part I of Schedule 10. So it appears that there was confusion there as well.
My noble friend Lord Campbell of Croy has emphasised the difficulty. My noble friend Lord Drumalbyn appears to have mastered the Government's intentions, but I think he most undoubtedly found them very faulty. The noble Lord, Lord Kirkhill, has battled to clarify the matter. Even if he was not previously aware of the fact, he must now fully realise how complicated is the drafting of this Bill. Surely the Government must take a long and searching look at these important matters and come back to us on Report with some major Amendments.
4.51 p.m.
Lord GLENKINGLAS: I wish to mention only one or two matters. I do not think that this is the right moment to discuss the whole of the distribution of industry, although I have had a good deal to do with it. I beg my noble friends Lord Harmar-Nicholls and Lady Ward to remember that it is absolutely impossible in political terms ever to do more justice to the more difficult parts of the country if one goes on the principle of the law of equal misery or absolute fairness, or whatever other name we like to

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give it. The fact of the matter is that over a very large number of years the economy has become overheated almost entirely as a result of the pressure of employment in the South-East. When that happens, more and more labour is sucked down and more and more problems arise on Tyneside and in Scotland.
Having promised that I would not go into those matters in depth, I would say just this. If a Scottish Assembly does arrive, and if the Government are able to clear up in their minds—which they are obviously having a good deal of difficulty in doing in the clause that we are discussing —what the Assembly can and cannot do, there is only one fact of which I am absolutely certain. The Assembly will debate, and will debate very fiercely, the whole subject of the Scottish Highlands and Islands Development Board, the SDA and everything else. Nothing that the Secretary of State for Scotland says in the guidelines will stop them doing that.
The Earl of ONSLOW: There is one comment I should like to make on what the noble Earl, Lord Perth, said. He complained that a lorry carrying, say, either £1,600 worth of wheat or £20,000 worth of cigarettes, must pay 50p to cross a bridge. The Scots cannot have it both ways. They cannot complain that vehicles using bridges must pay tolls, and still then receive a greater percentage of the gross national product per head than do the English. This w ill produce an English backlash. I never want to see that. The Scots cannot have it both ways. They cannot be dog-in-the-manger on one side of the Border, expect the English to pay the bill, and not expect the English to get cross and, finally, to say: "Go away with it".
Lord WIGG: I shall not keep the Committee for more than a moment. However, I cannot let this pass. One has been charged, first of all, with wanting to put the economy into a straitjacket; and, finally, that one is tied to a gospel of equal misery. Nothing could be further from the truth. The question is one of simple arithmetic. The sum total of the parts cannot exceed the sum of the whole. It seems to me inevitably that that should be recognised as a political reality. If, therefore, as a result of this Bill, we
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dangle in front of Scotland the idea that generating political pressure will solve economic problems—that we may give to A without taking it away from B—that seems to me not only dishonest but a recipe for utter political disaster.
I agree absolutely with the noble Lord, Lord Harmer-Nicholls. This is a political "conning" operation, not only of England. We are used to it, and to coming through it; but the Scots are not. It is a "Conning" operation as far as Scotland is concerned. The Government cannot deliver the goods, because it is impossible to deliver them. I would add something else. Lord Harmar-Nicholls said that if we gave to Scotland there would be a reaction in the noble Baroness's area. But that is not all. This is a recipe for disruption. If, in actual fact, we give to Scotland and we have to take away from the North-East, the pressures will not stop in the North-East. The North-East will want to take it from Wales; Wales will want to take it from Merseyside. So we go on.
The whole concept to which the British people have responded for the past 300 years is this. Face them with a disaster, never mind how grievous, and they have never run away from the consequences. If you like, they have muddled through. But this will set A against B, and B against Z. That is my reason—not because I want a political straitjacket, not because I am pleading for economic planning, although I happen to believe in it, not because I want to hear that we shall all be miserable together, but because the Government are putting on the Statute Book a piece of political chicanery which I am absolutely certain will not work.
4.57 p.m.
Lord KIRKHILL: I think I may say with complete confidence, and without disagreement, that this has indeed been a wide-ranging debate this afternoon. I should like to say at the outset to my noble friend Lord Vaizey that he should pay serious heed to the remarks of the noble Lord, Lord Glenkinglas, because there is little doubt that the Scottish Assembly will discuss almost anything. I think that I have made that point before now from this Dispatch Box. It should be emphasised, however, that the Scottish Assembly cannot legislate upon

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everything. However, it will certainly discuss that which it chooses to discuss; there can be little doubt about that.
I also say to Lord Vaizey that it is worth keeping in mind that the Scottish Development Agency at the present moment does operate under a form of guidelines. Those guidelines were formulated after considerable debate in the other place, particularly when the honourable friends of noble Lords opposite made many pertinent points which the Government at the time accepted. There is that background to the discussion on the guidelines which it is as well to make clear.
As it is almost 5 o'clock I do not think that I need to particularise on every political nuance that has emerged in the past couple of hours. Certainly one point has emerged clearly. I thought that I had rather long-windedly—as I admitted at the time, but with as much clarity as I thought I could comprehend—indicated Government thinking as to the detail of the guidelines and the function of the Scottish Development Agency. I agree with the point made by many noble Lords, that in many regards this is the point of economic teeth, as it will relate to the Scottish Assembly.
I suggested earlier this afternoon that there were three broad functions for the Scottish Development Agency. I did not expand on those functions at the time. I spoke about them last week. But it is obviously correct for me yet again at least to direct your Lordships' attention to the three broad functions—but not at elaborate length. The first group is environmental and factory-building functions. This will interest the noble Lord, Lord Burton. I agree with him. It is even more confusing for me than for the noble Lord. I agree with him that it is indeed a complicated Bill. However, I would direct the noble Lord, Lord Burton, first of all to Group I. We might say that these are the environmental and factory building functions. They will be devolved both executively and legislatively. That is the crucial point for your Lordships to understand.
This is achieved by the inclusion of the matters of town and country planning, industrial sites arid improvement of derelict land contained in Group 6 in Part I of Schedule 10. It brings these
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matters within the legislative competence of the Scottish Assembly and the powers of the Scottish Executive. Thus the Scottish Assembly, as I have said, can legislate to alter these functions in any way that it thinks fit and the Scottish Secretary will exercise the powers presently exercised by the Secretary of State in relation to the SDA's functions in this group. The Scottish Secretary will also be able to give directions to the SDA in relation to these functions.
The second group, the industrial investment functions, are not devolved by any of the groups in Part I of Schedule 10 and are not mentioned in the entry against the Scottish Development Agency Act 1975 in Part III of Schedule 10. I direct your Lordships' attention to pages 65 and 67. However, of course, they do feature in Schedule 11. Again, I fully understand the difficulty of the noble Lord, Lord Drumalbyn, and I shall give synpathetic consideration to his suggestion that I might pass across to him Notes on Clauses which might help the noble Lord to wend his way through the tortuous labyrinth of Schedule 11. I am not in any way minded to think that that is an impossible suggestion.
The Schedule transfers an executive competence only. Paragraph 7 of Group D of Schedule 11 enumerates the powers in the 1975 Act which are to be devolved to the Executive. Those include Section I which deals with the constitution and membership of the Agency. As the noble Lord, Lord Campbell of Croy, indicated earlier, it means in practice that the power to appoint all the Members will pass to a Scottish Secretary.
Among other powers in the 1975 Act to be devolved are the powers to give specific and general directions to the Agency in relation to its industrial investment functions—that is, Section 4; the powers to determine financial duties for the Agency in relation to those functions —Section 12; the power to approve certain acquisitions of share capital by the Agency—Section 14; and the powers in relation to the financing of the Agency and control of its borrowing powers in Schedule 2 to the 1975 Act so far as it relates to the industrial investment functions of the Agency. Those powers are not—and I must repeat "not"—within the legislative competence of the Assembly.
Lord VAIZEY: I should like to raise one matter because I am trying to help the Committee to understand what my noble friend is saying. If this is within the Executive power of the Scottish Assembly, am I right in saying that if one were a Member of the Assembly one could ask a question of the Secretary, but one could not propose a change? Is not that precisely what we are trying to get at? It is precisely where the feeling of impotence will affect the Members of the Assembly. On the whole, I am sympathetic and shall support the Government if there is a Division on this particular issue, but it seems to me that the Minister ought to try to explain a little further—I am sure that he will do so a little later in his speech—why there is this division between the Executive and the legislative powers.
Lord KIRKHILL: For one moment I was hoping to conclude my speech quickly from this point on. As I see it, it is a question as to where we draw the line. My view is that because there must be fairness as between all sections of the United Kingdom economy—a point which the noble Baroness, Lady Ward of North Tyneside, made much of, and I think properly so— it seems to me absolutely correct that environmental factors stand totally devolved within the legislative competence of the Assembly. The area of industrial function stands within the Executive competence of the Assembly, but not within the legislative competence of the Assembly. The noble Lord, Lord Vaizey, is correct in that interpretation. He may think that that is the wrong point at which to draw the line but I can only say that that is the line at which the Government stand at this time.
The third group stand reserved. These relate to the ability of the Secretary of State to provide selective financial assistance. Part I of Schedule 10 is explicitly omitted from devolution by the entries against the SDA Act in Part III of Schedule 10 and, of course, those matters do not appear in Schedule 11. That means that the Agency will continue to be responsible to the Secretary of State for the exercise of these powers.
The noble Lord, Lord Drumalbyn, who opened the debate on the Question, Whether the clause shall stand part? put to me a number of specific questions. As
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I understood them, and there were several, the first question concerned the relationship between the Secretary of State for Scotland, on the one hand, and the Secretaries of State for Trade and Industry, on the other. I can certainly affirm that they will not be affected by devolution.
Lord DRUMALBYN: I was mainly asking whether the Distribution of Industry Act would continue to work no less favourably for Scotland in the future as it has in the past.
Lord KIRKHILL: Obviously, in the light of what the noble Lord has said I had misunderstood the point of his question. I think that that is a reasonable assertion which can be made from the Dispatch Box. It is certainly intended that the Act will operate in an equable manner in the future, as it has in the past.
The noble Lord, Lord Drumalbyn, asked me a specific question as regards the situation anent rent free periods. Approval will be given by the Scottish Secretary within the guidelines which will ensure, as I have been trying to emphasise this afternoon, fair play with other regions of the United Kingdom, but will be appropriate to Scottish conditions. As far as guidance to the Scottish Development Agency is concerned, the guidance really comes only from one quarter, the Scottish Secretary; and that point was also raised by the noble Lord, Lord Drumalbyn. The main concern for regional and industrial policies will remain with the Secretary of State. The guidelines will be a part of the Secretary of State's range of measures for carrying out his policies and they will relate only to the limited range of matters within the industrial economic area to be dealt with by the public bodies which are mentioned within the clause. I suggest that there is no reason to suppose that after devolution the Secretary of State will become indifferent to Scottish unemployment. In my view, it is not a political reality that he will in any way seek to impose rigid and inflexible conditions—something which he does not do at the moment. I could not foresee that as a political possibility.
The noble Lord, Lord Drumalbyn, also asked from whence will the money to finance the SDA's activities emerge. Of course, the monies will come from the Scottish Consolidated and Scottish Loans

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Funds. The amount will be decided by the Scottish Administration. I have taken on board his suggestion that I might think about Votes on clauses as regards Schedule 11. I could point out to the noble Lord, Lord Drumalbyn, and to other noble Lords who are interested, that guidelines as far as I know, as they relate to the HIDB, can be seen. It is not a question of a closed area.
I can only say in conclusion that the Government may not have the package in Clause 38 exactly right. Does any Government ever quite achieve perfection? However, in view of all that has been said in a very useful debate, it is worth keeping in mind a point to which I frequently return—the Scottish Assembly must be as unfettered as possible to take its own mature decisions. In my view, the political realities of the Scottish scene, as they stand today, will ensure that those who are elected to the Scottish Assembly will behave in a responsible political fashion and that whoever is the Secretary of State for Scotland for the day will be a man charged with supporting the economic regeneration of that country.
The Earl of SELKIRK: I should like to ask one question before the noble Lord sits down. If he looks at Part III of Schedule 10 he will see under the Scottish Development Agency Act a long list of matters which presumably are included—that is to say they are excepted from being not included. I cannot conceive that they really are subject to amendment in the Assembly. In other words, it seems to me that these are powers which the Executive has and I do not understand why they are not in Schedule 11. I simply cannot believe that we shall have the Scottish Development Agency Act amended in little bits—paragraph by paragraph. I find that very hard to believe. Therefore, I do not know why it does not come under Schedule 11.
The noble Lord then said, in regard to the powers which are set out under paragraph 7 of Schedule 11, that the Scottish Secretary is responsible to the Secretary of State. Did I understand the noble Lord correctly? Is the Scottish Secretary not responsible to the Assembly? If what the noble Lord said is so, it reverses the whole situation. When a Scottish Secretary takes powers under, say, Section 1 of the Scottish Development Agency Act
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is he responsible to the Secretary of State or to the Assembly? This is a fundamental matter the answer to which we must know.
Lord KIRKHILL: As to the first matter which the noble Earl has raised with me, he must read that part of Schedule 10 with Group 6 on page 48 and then consider those two with Schedule 11. I think that that reply is as helpful as I can be in a quick, off-the-cuff reply. As to the second part of his remarks, he heard me quite correctly.
Clause 38 agreed to.
Schedule 7 agreed to.
5.12 p.m.
Lord HARMAR-NICHOLLS Lord HARMAR-NICHOLLS moved Amendment No. 360:
Before Clause 39, insert the following new clause:
National Pay Policy
(". In exercising his powers, a Scottish Secretary shall be bound by such considerations of national pay policy as may be specifically brought to his attention by a Minister of the Crown.").
The noble Lord said: There is no question of pushing this new clause to a vote this evening, whatever views noble Lords may take of the argument. However, I want to pose a question, and later on, during the process of developing the Bill, we can decide what to do with it. This new clause standing in my name and that of my noble friend Lord Morris, is almost identical to Clause 40 which appeared in the original Government Bill dealing with both Scotland and Wales. The only difference between what the Government then included and what is in my new clause is that the original Bill said:
"In exercising his powers, a Scottish Secretary shall pay regard to national pay policy".
My clause, instead of merely paying regard, says that a Scottish Secretary shall be bound by national pay policy. This clause was thrown out from the original Bill without any debate, so I should be interested to hear from the noble and learned Lord, Lord McCluskey, why it was included in the first place—what were the reasons for removing it later? As I see the situation, it looks as though the original decision to include it was a very wise one.
We all know from experience over recent years that one of the touchiest problems in the economic life of this country is concerned with pay policy. Whether or not one agrees that a Government ought to have a pay policy, no one doubts that it is a very touchy subject which brings with it all sorts of disruptions if it is not considered to be right, in particular by the trade unions or by breakaway members of trade unions. If such a clause was important enough to be included in the first place, why have the Government made no attempt to restore it on this occasion? Indeed, why was the corresponding clause removed from the Wales Bill—which I presume we shall discuss eventually—without even a fight?
Naturally, I have looked into the possible reasons in order to avoid wasting your Lordships' time. It may be that the Government consider that Clause 36(1) is broad enough and strong enough to meet the case of an Assembly ignoring a national pay policy. Clause 36 says that if any action proposed to be taken might affect a reserved matter, and if the Secretary of State thinks that it is against public interest, he may direct that it is not taken. It may well be that the noble and learned Lord, Lord McCluskey, will say that in the Government's view that is a strong enough protection against the sort of problem that could arise if, on a pay policy matter, Scotland tries to do something contrary to what is happening in the rest of the United Kingdom.
I do not think that Clause 36(1) will cover that. That subsection merely seems to cover a situation where any proposed action is seen to be against an EEC decision or against an international agreement that is laid down. However, the loose wording of Clause 36(1) does not seem to cover a pay policy alone. Furthermore, it does not appear that the Schedule, which purports to spell out these matters, does that either. It does not specifically reserve all matters which would cover pay policy.
For example, education is a devolved subject. If we give the Assembly power on educational matters, we could presume that that means it has power to decide what it pays its teachers, that it has the power to decide the sort of wage rates and salaries generally in education in order
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to meet what it considers to be its educational needs. Therefore, teachers' salaries are not specifically exempt from the devolved power. If, as a result of a pay policy in the United Kingdom as a whole, there was a restriction on teachers' salaries, what sort of a problem would we have if Scotland has the power, through its Assembly and Executive Council, not to adhere to the same pay policy as England and Wales? That is a conflict which would bring many problems. If a pay policy was the right one, the very existence of the special dispensation given to Scotland may affect the pay policy working at all. Therefore, we should like it spelled out a little more clearly in words than at the moment Clause 36(1) or (2) seem to do.
However, on broader issues, bearing in mind all that has been opened up, we see very many more problems arising. For example, if the Scottish Assembly was anxious to attract more firemen, nurses or, as I have said, teachers, and in order to do so it decided to pay them more, presumably that could infringe any pay policy that happened to be in force in the United Kingdom. However, if any conflict arose, where would the fight take place? Would such people be objecting to the Assembly not giving them the extra money, which they had satisfied the Assembly they should have; or would they be fighting Whitehall, who were directing the national pay policy and trying to stop this happening? Unless this is spelled out more clearly, we shall be building into this vital and explosive subject of a pay policy either dissatisfaction with the Assembly, which would result in conflict, or dissatisfaction with Parliament, which has kept the reserved powers concerning finance generally.
The problem here is quite enormous. It is inherent in a Bill such as this, which either gives away too much or gives away much too little. If the Assembly is not obliged to conform with national pay policy, then it will drive a coach and horses through any pay policy that may exist in the United Kingdom. If it is obliged to conform, then there is a lack of freedom of action, which will mean that you are going to have friction because the Westminster Parliament will be denying the Assembly things which it thinks it ought to have.
What do the Government think about it all? Is the truth—and it looks this way

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unless the noble and learned Lord can dispel it—that the Government want Scotland to conform to a pay policy (I imagine they would, otherwise it would wreck it) or that they will ignore answering the question I am now putting because there is not an answer? That is the question that applies to so many clauses in this Bill.
As regards this matter, they have put the clause in and taken it out; and it looks as though they cannot make up their mind as to the answer because they do not know the answer. I do not believe that a Bill should be presented when there is that sort of conflict. On the face of it, it would seem that a national pay policy would not be affected in a Bill which is as detailed as this one. But if you have given a loophole whereby one part of the United Kingdom will be able to break away from a national policy laid down by a Westminster Government, or force the Westminster Government into a position where they have to appear to go against the elected Assembly representing Scotland there again we have the conflict.
Having got that on the record, which is merely a repeat of what one has said so often up to now, the question I am really putting to the noble and learned Lord is, why have the Government not tried to restore this clause when they put it in in the first place? What are their reasons for thinking that it was a good thing to remove it, and to rely upon what I think is a very weak Clause 36(1) and (2), and to say that the point is covered thereby? I beg to move.
5.22 p.m.
Lord BROWN: May I make a short comment on the form of argument which the noble Lord, Lord Harmar-Nicholls, has used, and which, indeed, has frequently been used in the earlier debate on the Question, That Clause 38 stand part? Really, what people are tending to say is that devolution is not possible.
Lord HARMAR-NICHOLLS: Yes.
Lord BROWN: This means that no federal state can exist appropriately anywhere in the world. This is what people are saying; that you cannot devolve. That is a piece of nonsense.
Lord HARMAR-NICHOLLS: May I answer that?
Lord BROWN: No, let me make my point. The noble Lord can rise in a moment. What he is saying is that relations between this country and the EEC are nonsense, because there are overriding rules which we in this country have to observe. The authority of this country is now exercised within guidelines, or directives, and other legislative instruments agreed by the EEC, in the same way as the Scottish Assembly will exercise a certain authority within the policies, legislation, guidelines, call them what you like, set up by the United Kingdom Parliament.
We all know that these are difficult matters, and to set out all the fine points as to where decisions shall be made and where they shall not is excessively difficult. But devolution is something that we are going to have to face in this country. Ours happens to be the largest population in the world today which is centrally governed. Perhaps noble Lords have not appreciated that point. France comes next, but of course France has a great deal of devolution through its Executive that we have not got. Germany is federal; Canada is federal; the United States is federal; Australia is federal; Italy has gone federal. We cannot carry on with a growing population with all authority and power being exercised from the centre. We have to work out how to devolve authority. The arguments being used are intended to show that it is impossible. Well, it is not impossible. It has been done elsewhere, aid it will have to be done in this country.
Viscount MASSEREENE and FERRARD: Scottish devolution is not creating a federal state; it is something quite different.
Lord HARMAR-NICHOLLS: If the noble Lord's remarks were addressed to what I have said, may I say that I have not said, and none of my noble friends has said, that devolution is not possible? What I am saying is that if devolution is possible this Bill is not the way to devolve. What we are saying is that, even if devolution is possible—and it may well be for the reason that the noble Lord gave—this particular Bill is not the way to do it,

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because it carries with it more conflict than it brings about settlement, whether the result be federation or otherwise.
I do not think that our arguments ought to be presented on the basis that one is a dog in the manger wanting to kill the whole of the Bill. What we said on Second Reading (and it is a principle on which I still stand) is that much more thought must be given to it; there must be a meeting of all the Parties. That is what my right honourable friend in another place, Mr. Francis Pym, undertook to do; to call all the interested people together in order to give more thought to the sort of Bill which will be presented and which might be able to make a devolved Parliament possible.
This is not such a Bill, and I do not think that the criticisms of this Bill ought to be lost behind a smoke-screen of suggestions that we are saying that on no account can there ever be any sort of devolution of authority, or even a step towards federation. This is the Bill that we are discussing. This is what is in front of us, and this is what ought to be put into the dustbin, although, for the purpose of getting it to an end, we are suggesting improvements that might possibly be made in order to make it slightly less dangerous than it is in its present state.
5.25 p.m.
Lord VAIZEY: I happen not to support Lord Harmar-Nicholls's Amendment, but I think I follow the gist of his argument. May I say with respect to my noble friend Lord Brown that I think he has got it wrong. The fact that a man of Lord Brown's great intelligence and experience has got it wrong suggests that other Scottish people may get it wrong. First of all, this is not the largest unitary state in the world. There is China, and there is the Russian Soviet Republic inside the USSR, both of which are much bigger than the United Kingdom.
Secondly, the result of this Bill is not federalism. That is the whole point. If it were federalism then of course it would be perfectly easy to conceive of a way in which a Bill could be devised to make the division clear. The Government have got a Bill which is as complex
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as this precisely because this is not federalism. If I may interpolate, I think I mentioned in the debate on Clause 38 stand part that I thought Clause 40 was also crucial, but I meant to say Clause 44, which is certainly the one which is very important.
The question to which Lord Harmar-Nicholls has addressed the minds of the Committee is where the line is drawn. I absolutely agreed with Lord Harmar-Nicholls; I thought all the instances which the noble Earl, Lord Perth, drew to the attention of the Committee made his own case far worse. It is certainly true that the United Kingdom has spent more per head on the Scots than it has on the English. Therefore, if they are going for Home Rule, they have to go for Home Rule on their own resources and they will be a jolly sight worse off than they are now if that is the line they want to follow. The argument for Home Rule has largely been—and I have read most of the literature on this which has been put before the Scottish people and most of the arguments—on the grounds of the economic powers that are to be devolved to Edinburgh. It is quite clear that the economic powers are not going to be devolved to Edinburgh.
What worries me is that so much of the argument in the Assembly will be about economic power. This is why I was alarmed early on in the Bill when the noble Lord on the Front Bench conceded so much of the right of the Assembly to debate what it liked. I am assured by my Scottish friends that you cannot stop Scottish people discussing anything. At the parochial church council they will get up and talk about this, that and the other. But the alarming thing is that, in what is a legislative Assembly which will inevitably become called a Parliament, they will be discussing matters over which they have no authority whatsoever.
The Government have drawn the line very carefully, and on the whole I agree absolutely with their choice of where to draw the line. It has been done extremely skilfully. But they have left this residual situation in which the Assembly can argue but it cannot legislate. This is a recipe for a great dissatisfaction. There is a feeling of impotence and alarm which, in periods of economic difficulty, will cause a strain between Scotland and the rest of

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the United Kingdom. If this became a model for the other devolution Bills which I agree with the noble Lord, Lord Brown, will follow—at least we hope they will follow, for example, for various areas of England—then it is alarming. I am sorry to delay the Committee by discussing this, but these are the crucial economic clauses and it is worth while the Committee taking a little time to think whether or not, after calm consideration, it agrees with the Government. On the whole, I agree with the Government—I am persuaded by their argument and I agree that the Bill has been carefully and skilfully drawn—but I echo the warning of the noble Lord, Lord Harmar-Nicholls, that it is in this area that difficulties will arise.
Lord MORRIS: I was delighted to see the noble Lords, Lord Brown and Lord Vaizey, taking part in this debate. That there are now four Back-Bench Socialist noble Lords contributing in Committee to Conservative Amendments to the Scotland Bill shows clearly the immense enthusiasm noble Lords opposite have for the Bill and how well they support their lonely colleagues on the Front Bench.
I speak to support the Amendment which stands in the name of my noble friend Lord Harmar-Nicholls and myself. It was patent that it was the Government's original intention that Scotland should be bound to head a national pay policy, presumably because the Government then, as now, are of the opinion that the United Kingdom is one nation. It is clear to me that without this clause the Scottish Assembly could blandly ignore consideration of national pay policies in devolved matters. The resentment that would be caused if the Scottish Executive could settle an industrial dispute in terms more favourable than for those affected in England, Wales and Northern Ireland would be considerable and would prove to be yet another wedge driven between Edinburgh and Westminster; more division, more resentment and more acrimony.
In the absence of this clause, the Government might consider that they could rely on the provisions of Clause 36(1) and (2), as mentioned by Lord Harmar-Nicholls, which empower the Secretary of State to intervene if the Assembly resolves some-
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thing to the national detriment. Imagine, should Westminster act ex post facto, the outcry from those celebrating a wage award in excess of the national guidelines. Like Lord Harmar-Nicholls, I ask the Minister why the Government have failed to restore this clause and have also taken the corresponding clause out of the Wales Bill, again without debate. Without this clause, the Bill would patently be divisive and I beg the Minister to consider the matter with care and precision.
The Earl of ONSLOW: I totally agree with what my noble friends Lord Harmar—Nicholls and Lord Morris said about the necessity for this clause or something like it to be put in the Bill, but now, like Cassandra, one must utter another word of warning. It gives the Scottish Assembly a chance to say, "The Scottish economy is doing all right because we have all this oil"—which is what the Scottish Nationalists have been talking about; that it is Scottish oil and they have it all—"We cannot settle this industrial dispute. We know you have a very good case, but it is the chaps in Westminster who are stopping us" That is an argument against it, or it goes to underline yet again the dissension, quarrelling and unhappiness that this particular form of devolution will produce. We are either giving too much or we are not giving enough.
5.34 p.m.
The SOLICITOR-GENERAL for SCOTLAND (Lord McCluskey): I hope the Committee will forgive me if I do not follow the example of my seniors and make a Second Reading speech but, rather, address myself to the matters about which I have been asked by the noble Lord, Lord Harmar-Nicholls. When the Scotland Bill first appeared, it contained the clause in approximately the words he quoted—I do not think he was pretending to accuracy—but the words were "to have regard". That derived from paragraph 161 of the original White Paper of November 1975, where such a clause was foreshadowed, but of course it was never intended—and the original Bill did not contain a provision to carry out any such intention—that the Secretary of State or Westminster should be able to direct the Scottish Secretary to conform. The new clause moved by

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Lord Harmar-Nicholls is really a world away from that original clause. It has this advantage, however, that it makes the fundamental point here that either you have a statutory policy or you have one which rests on consent. I think that that is the fundamental difference, and the rewording of the clause by Lord Harmar-Nicholls makes that point clear.
I will look briefly at the history of this matter. The clause appeared in the Bill in the words I have indicated. It was defeated by 161 votes to 160 in Committee in another place—the circumstances of that are not such that I should go into them deeply—and the Government took the view that the clause, while desirable as an indication to the Scottish Secretaries about how they might exercise their powers, was not essential. Indeed, it was not couched in words which would enable Westminster to direct the Scottish Secretaries to do this or not to do that. Accordingly, on the view that it was not essential and on the view that the other place in Committee had decided by a majority that the clause should not be restored, the Government accepted that position. Indeed, that was the position in relation to the Wales Bill as well; it was decided that the Wales Bill should not be different from the Scotland Bill in that regard.
Lord Harmar-Nicholls referred in his remarks to Clause 36 but I think he really had in mind Clause 36(1) rather than Clause 36(2), and the wording of that makes it clear:
"If it appears to the Secretary of State … that any action proposed to be taken by or on behalf of a Scottish Secretary would or might affect a reserved matter"
—then he can step in and stop that action. Pay policy is not a devolved matter and, because of the structure of the Bill, those matters which are not devolved are reserved, and of course within the context of these clauses, particularly Clause 36, there is some definition of what is meant by "reserved matter" for the purposes of the exercise of these override powers. Thus, if the conditions which require to be fulfilled in. Clause 36 were met, then the Secretary of State could step in and use the powers which that clause confers on him.
If there is to be a statutory policy in relation to incomes—and neither of the
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major Parties espouses such a policy—that would have to be brought in by Westminster; it would not be brought in in this form and apply only to Scotland. I should make it clear that Lord Harmar-Nicholls was quite right in saying that the Scottish Secretary has responsibilities in relation to pay, and he gave an example about education. He is right of course that the Scottish Secretary has control over teachers' pay and, accordingly, it is at least possible that teachers' pay may come to differ in Scotland from teachers' pay in England. In fact, it does so at the present time without causing any great harm.
Lord VAIZEY: It differs because the structure of the teaching force in Scotland differs from the teaching force in England and Wales. Nevertheless, we are all subject to the guidelines laid down by the Government and of course they may at any time become statutory should the economic situation deteriorate. With respect to the Minister, I think he is being a little reckless in saying this could not cause difficulties because if the economic powers remain with Westminster, views with respect to wages are bound to be the responsibility of Westminster. If so and if a settlement is reached in Scotland and then has to be overridden, the precise difficulties which have been drawn to the attention of the Committee will arise, and that is a serious problem about which the Government should think more.
Lord McCLUSKEY: I hope I was not reckless. I was merely confirming that powers existed under Clause 36; I had not yet come to the possibility that they might be exercised. In relation to the general matter, as I said, both the major Parties have rejected any statutory approach to pay policy and the present Government have accepted a pay policy which rests on consent, and I think the Committee would agree that that policy has been seen to be successful since 1975.
When one compares the failure of a statutory policy with the success of a voluntary policy, one sees that it is perhaps an object lesson in how these matters work. If there was to be pay restraint on some future occasion, and pressure had to be brought upon Scottish Secretaries to follow the same lines as were being followed elsewhere, that,

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again, would have to rest upon their consent. In my submission, there is no good reason to suppose that the Scottish Executive, as an elected body open to the scrutiny of public opinion in Scotland, and to the scrutiny of the Scottish electorate, would act to ignore such a basis of consent.
Apart from that, a great many people in Scotland—certainly the majority, one would have thought—will, after devolution, still look to have their pay and conditions of employment determined by agreement nationally in both the public and private sectors. I would also remind the Committee that on a previous occasion when we looked at, I think, Clause 22, we saw, in relation to that clause and Schedule 4, that the second column of Schedule 4 includes a number of entries relating to where the consent of a Minister is required for terms and conditions of service; for example, in regard to the National Health Service.
Clause 62 makes officers and servants of Scottish Secretaries civil servants in the ordinary way, and their terms and conditions will continue to be agreed nationally. Local authority employees will remain in the employment of their authorities. At the present time the Government have no statutory control over the pay policy of local authorities, but the pay policy has been observed by local authorities—not all of them of the same political persuasion as the Government. One has no reason to suppose that that would be any different under a Scottish Assembly.
I invite your Lordships to look at the terms of the Amendment. I know that the noble Lord is not proposing that the Amendment be included in the Bill. But to return to a point I made earlier, if your Lordships look at the terms of the Amendment you will see that they throw into relief the point that either there is a voluntary policy or a statutory policy. There cannot be a statutory policy which applies only to Scotland. Accordingly, the policy must rest upon the basis of consent. That is what the Bill allows for, and in my submission the Bill should stand as it is.
5.43 p.m.
Lord HARMAR-NICHOLLS: I wish to take up one point arising from what the noble and learned Lord has said.
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One has to concede at once that if there is never a statutory wages policy, the protection that I want to include would not need to be used. But that is rather like saying that because one has not had a fire so far, there is no need to have insurance. In the past all Parties have tried a statutory policy, and who is to say that such a policy will not return at some time in the future? I am not in favour of it, as I understand the general economic thinking at the moment, but since this is a possibility which may arise, I do not see that we ought to do other than try to protect ourselves against any ill-effects which may arise from it if it occurs.
With regard to the matter in question being turned down in another place, I think that the impression which the noble and learned Lord gave was perhaps not completely accurate. The proposal was lost by one vote. It did net involve turning down the necessity for a clause such as this. It was a question of whether the phrase should be "pay regard", or "be bound by". Some of my honourable friends who think as I do wanted the phrase that I have here—" shall be bound by"—as the Amendment showed. I think that their proposal came under the guillotine, like others, and it was turned down on the narrow issue of whether—am I wrong on that? Does the noble and learned Lord wish to intervene?
Lord McCLUSKEY: With respect, I should correct the noble Lord. First, when I spoke earlier, I gave the actual figures. The voting was 161 to 160, from which one might readily deduce that the majority was one. Secondly, the Amendments to which the noble Lord refers, put down by his honourable friends, were not in fact reached, and the clause was defeated on clause stand part.
Lord HARMAR-NICHOLLS: But it was the old story; it was not debated as a separate item—not to the extent that we are doing it today. Having listened to the explanation of the noble and learned Lord, I hope that he will give some thought to whether Clause 36(l) and (2) really do give the powers for the provision to cover the whole of the United Kingdom without causing conflict. I thought that the point made by the noble Lard, Lord

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Vaizey, was very sound, and it ought to be taken into account by Report stage, or even later.
Lord McCLUSKEY: Before the noble Lord withdraws the Amendment, I should like to try to make clear a point which obviously I have not got across. If in fact a statutory incomes policy were to be introduced in circumstances which we do not foresee, and he does not foresee, (though we must allow for the possibility) that would be in a non-devolved area. The Statute which introduced such a statutory wages policy would contain provisions which would make that policy bite both in Scotland and in relation to the employees of bodies for whom the Scottish Secretary was responsible. So there is no difficulty about that. One does not have to provide in this Bill that if a United Kingdom Statute on pay policy is passed, it shall be binding upon a Scottish Secretary. That is not necessary.
Lord HARMAR-NICHOLLS: I take the noble and learned Lord's view on that, but as I read them, neither Schedule 10 nor Clause 36 (1) and (2), give the complete clearance which he has suggested. Complete clearance is given on European and international matters, but I do not think that the complete clearance that he has suggested is given on home policies, such as a statutory incomes policy, which does not affect either the European Community or international affairs. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 39 [Minister's consent to terms and conditions of service of certain persons]:
On Question, Whether Clause 39 shall stand part of the Bill?
5.46 p.m.
The Earl of SELKIRK: I should like to draw attention to the use in this clause of the phrase "a Minister of the Crown". The clause says that:
"A Minister of the Crown may from time to time by notice given to a Scottish Secretary …".
As I read this, when a Minister of the Crown gives notice to a Scottish Secretary
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that action is complete. There is no qualification of any kind. From that moment the Scottish Secretary is entitled to act as if this were an authoritative notice.
The position of a Minister of the Crown is extremely vague. All the noble Lords and noble Baronesses on the Front Bench opposite are Ministers of the Crown. If your Lordships look at the Ministerial and other Salaries Act 1975, you will see that the Prime Minister has authority to create —I think I am right in saying—171 Ministers of the Crown. They are the chaps who form the Government, to put it in the bluntest language. In this case one is referring to the Secretary of State for Health and Social Security; here Mr. Ennals is the man concerned. This provision is complete in itself, and if a Scottish Secretary receives a notice from any Minister of the Crown that would be adequate authority for him to act.
Secondly, I do not think that the use of this term in a Whitehall context would cause any bother. I say this because all the Whitehall Departments are very jealous of their frontiers, and if anyone stepped over a departmental frontier immediately there would be a row. Therefore, I do not think that using this phrase in a Whitehall context would matter. In this case, however, the matter does not relate to Whitehall, but to an Assembly in Edinburgh. Therefore, it would be quite possible for an error to arise as to whether the person giving the notice had in fact proper authority to do so.
Finally, I should like to say that this is by way of being a constitutional document. Can the Government not make it as simple and as straightforward as possible? The use of the term "Minister of the Crown" in this context is pure "Whitehallese". It is a term which is understood in Whitehall, but would not be understood in an Assembly elsewhere. I do not ask for an answer on this point at the moment as it will arise on another occasion, but in this clause the vagueness of the term is particularly obvious, and so I venture to draw it to the attention of the Government. But I do not press the matter at all or ask for an answer.
Clause 39 agreed to.
Schedule 8 [Terms and Conditions of Service—Descriptions of Persons Referred to in Section 39]:
The DEPUTY CHAIRMAN of COMMITTEES (Lord Jacques): I have to point out to the Committee that if Amendment No. 361 is agreed to, I cannot call Amendment No. 153.
5.50 p.m.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 361:
Page 47, line 5, leave out ("Medical or dental practitioners").
The noble Lord said: In moving this Amendment I think the one which has just been referred to, No. 153, in the name of my noble friend Lord Selkirk, might be discussed at the same time. The clause we have just been discussing, Clause No. 39, and Schedule 8 go together. One effect is that within the categories of person described in Schedule 8—and they are all connected with health or hospitals—the Assembly and its Executive can be given a free hand to decide on the salaries, pay and conditions of service without needing the consent of the Secretary of State for Scotland or another central Government Minister. After what my noble friend has just been saying about the ambiguity of the term "Minister of the Crown" I shall not describe the authority as more than that.
My Amendment seeks to delete medical and dental practitioners from this effect, that is to say, medical and dental practitioners working under contract with the health authorities in Scotland. At this stage we are not dealing with that part of the Bill to devolve some of the health services to the Scottish Executive and the Assembly—we come to that later in Schedule 10. This debate is limited to responsibility for pay and conditions of service. My reason for raising this question—and I am sure that the Government are aware of this—is that the representatives of the doctors, surgeons and dentists in the United Kingdom as a whole are very worried about these matters being determined separately in Scotland and South of the Border. They believe that it would be unsettling if salaries and conditions of service became different in Scotland from those South of the Border and no doubt, depending in which direction the difference was, it might be considered by the practitioners on one side of the Border that the
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result was unfair. Whether the salaries and conditions appear to be better or worse in Scotland it could lead to doctors, surgeons and dentists being attracted to move South or North.
The British Medical Association as a whole would prefer the remuneration and conditions of service to continue to be settled on a United Kingdom basis through the review body, and the BMA Scottish office in Edinburgh are firmly of this view and are opposed to including medical and dental practitioners as proposed in the Bill. They are not concerned with the political arguments about devolution or constitutional matters which we have spent so much time discussing in Committee. Their comments are directed only towards keeping what they think are sensible working arrangements for their professions, and in this way efficient health services and the best possible medical care for patients and for the country. I am satisfied that the BMA are not concerned with the actual question of devolution, whether it is a good or a bad thing and how it should be done. All they are concerned with on this point is that medical care and the professions will suffer if it is not a reserved subject.
I would just remind your Lordships that the review body was set up after the report in 1960 of the Royal Commission the Pay of the Medical Professions, and as a result the machinery has worked smoothly. On the dental side, the Dental Rates Study Group which was set up fixes a scale of fees every year in accordance with the recommendations of the review body. The professions cannot see any advantage in devolving this. They cannot see any advantage to the Scottish Executive or the Assembly, which will have quite enough to do in other directions, and all they see is the danger of differences arising which could be prejudicial to their professions. Therefore, I move this Amendment and hope that the Government will agree to it.
Baroness ELLIOT of HARWOOD: I should like to support this Amendment because when local government committees advertise for any of the medical professions they get responses from different parts of the United Kingdom, not necessarily just Scotland, and the qualifications which are asked for are identical. There is no question of getting anybody less well trained if they are taken from

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another part of the United Kingdom rather than Scotland. It would be a great mistake if this matter, which is so obviously a United Kingdom matter, were devolved. I agree with the noble Lord that it is nothing to do with anything political; it is wholly practical. These are standards set up on a United Kingdom basis, and those who have got the qualifications according to those standards might come from any part of the United Kingdom. They should be free to go to any part of the United Kingdom, if they want to, when a health authority wants to engage a doctor or a dentist. I hope very much that the Government will see the wisdom of this Amendment and will accept it.
5.57 p.m.
Lord COLWYN: I also should like to support the Amendment moved by the noble Lord, Lord Campbell of Croy. Health matters must be considered from the professional rather than the political point of view. The Scotland Bill must be tailored to the day-to-day running of the National Health Service. If this Amendment is not accepted I envisage the setting up of a separate health committee from the Scottish Assembly which would be yet another tier of administration in a service that is already over-administered. At present Scotland is effectively devolved, with a Health Act and a Scottish Home Health Department which is responsible for administration and for its own financial allocation.
The reasons for supporting the Amendment moved by the noble Lord, Lord Campbell of Croy, stem, as he said, from the acceptance of the Royal Commission's report in 1960. As a result, the review body was set up on a United Kingdom basis, and its recommendations refer to all practitioners in the United Kingdom, whichever country they practice in. Following acceptance of this review body the Dental Rates Study Group was set up. It fixes fees on an annual basis for the ensuing year. Apart from difficulties in 1976 and this year, due to the financil problems, the system works well and my colleagues and I wish it to continue, and that is also the view in Scotland.
I feel that in a devolved situation it would be wrong that the Scottish Secretary
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might be able to act on terms of service without the consent of a Minister of the Crown. As a result the terms might be different in Scotland from those in other parts of the United Kingdom, although the review body may have made recommendations and the Dental Rates Study Group already set a scale for people providing the same service in different parts of the country.
I also suspect that the block grant to Scotland from Westminster may be restricted when compared with its present size. It also may be further reduced by a Scottish Assembly giving a smaller amount to the Scottish National Health Service. I notice that the control of drugs is not to be devolved, nor is the university staff who effectively man the greater part of the Scottish National Health Service. For this reason, I would ask the Government to leave matters as they stand at the moment.
Viscount THURSO: I am afraid I take a view totally opposite to that of the noble Lord, Lord Campbell of Croy. It is perfectly possible, by legislation, to make everybody's salary scale the same, but it is totally impossible to make all their conditions the same. The thing is that in Scotland there has always been a tradition of a different system in particular for the different conditions in the Highlands and Islands; and in many other parts of Scotland, too, the conditions are totally different from those in other parts of the United Kingdom. It is only sensible, if we consider it sensible for Scotland to have an Assembly and to control its own domestic affairs in relation to the other things that affect people in their daily lives, for it also to be able to control matters which are important to their health. It should be able to offer doctors conditions of employment that will suit the conditions in which the doctors will have to work, and, indeed, suit the diseases and conditions of the sort with which the doctors and dentists will have to compete.
It is a well-known fact that dental caries, for instance, has a totally different impact in Scotland from the way in which it impinges upon the population of other parts of the United Kingdom. That might be blamed on eating too many sweets or it might be blamed on the Scottish high tea, but fact is that the incidence is

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different, and it may well be that the needs of the service are different in this connection. It may be due to the soft water that forms the public water supply in Glasgow. This may also be why there is a different incidence of heart disease in Scotland, and so on.
One could go on for ever talking about these things, but the fact is that there are differences. These differences have to be overcome, and, in overcoming them, it is only sensible that the people who live within the area and who have close knowledge of the local conditions should be those who make the arrangements that provide the conditions under which the doctors and the dentists will serve. Therefore, I take a view totally opposite to that taken in the Amendment here proposed.
Lord HOME of the HIRSEL: I could give a very easy answer to the noble Viscount, Lord Thurso, about soft water and how to change that for the benefit of people's health; but of course there can be a case for small differences as between the Highlands of Scotland and, let us say, the South of England. I do not think anybody would argue about that; but I am quite sure that the doctors and the dental profession are right to be worried about the possibility of a marked difference between the salaries and conditions of the services as between England and Scotland as a whole. That could really create some very unfortunate distortions; and I think the consumers—the patients—ought to be anxious, too. The case is so plain that I have no more to add, but I hope the Government will consider the Amendment moved by my noble friend.
Lord FLETCHER: I am not particularly interested in the merits or otherwise of this Amendment, and I rise merely for the purpose of drawing attention to a matter which I ought perhaps to have raised during the previous debate, and it is this. Schedule 8, an Amendment to which we are considering, is, as I understand it, governed by Clause 39 of the Bill, and the Bill provides, as we heard just now, that a Minister of the Crown may give notice to the Scottish Secretary. We have had some discussion as to what is meant by a Minister of the Crown, and in that context, I rise merely to observe that, if your Lordships will look at
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Clause 77, where there is an attempt to define "Minister of the Crown", your Lordships will see that it provides that,
"Minister of the Crown' includes the Treasury".
That seems to me a very odd provision to make in a constitutional Bill of this importance, and I want to give notice that I hope that, when we come to consider Clause 77 of the Bill, we shall have some explanation from the Government as to why the Treasury is, for the first time, as I understand it, elevated to the position of a Minister of the Crown.
Lord PLATT: I really was not going to join in the discussion, but as one of the few medical men at present in the Committee perhaps I ought to say something. I think the case has been so admirably put by the noble Lord, Lord Campbell of Croy, and other speakers that I hope the Government will be willing to accept this Amendment, which seems to me such a very sensible one.
As to the noble Viscount, Lord Thurso, and his objections to the Amendment, with respect, I do not think that they hold water, or that Scotland's water comes into it. You see, you could devolve the coal mining districts of Yorkshire, could you not, because the conditions under which doctors work there are considerably different from those in, for instance, Bournemouth. The Review Body has been set up to take all these things into account, and if there should be some particular reason why, for instance, it is almost impossible to attract doctors to some part of Scotland, England or Wales, and if the review body, in its wisdom, felt that some special reward should be offered to people prepared to serve in those districts, it could recommend it and the Government could accept it. Unless as I say, we are going to devolve every district and county in Britain, I see no force in the argument.
Lord BALERNO: I wish most strongly to support my noble friend Lord Campbell of Croy, and I should like to draw your Lordships' attention to the fact that it is very strongly felt among the medical and dental practitioners in Scotland that they should not, as the Bill at present suggests, be separated out into a different service. I have one other point to make, and I am not going to go over the arguments which have been made, which are

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already convincing. The one other point is that the universities are not being devolved, and the medical profession in Scotland looks towards the universities where it has been trained, it goes back to them for guidance and it is virtually part of the corpus of the universities. Therefore, if the universities and the medical schools are not devolved, neither should the doctors or the dentists be devolved.
6.8 p.m.
Baroness STEDMAN: May I say at the outset that we are aware of the concern of the BMA; we are aware, as the noble Lord, Lord Colwyn, has reminded us today, of the concern of the dentists about this particular provision; and we share the concern of the mover of this Amendment, Lord Campbell of Croy, to retain some similarity in terms and conditions of service for the medical professions throughout the whole of the United Kingdom. We wish to do nothing which will weaken the unity of the professions or discourage mobility within them. It is the consent provision in Schedule 4 which we have to look at, and that should be viewed for what it is: the maintenance of a control by the Government of terms and conditions of service in Scotland as in the rest of the United Kingdom, to be exercised in the interests of the health professions throughout the United Kingdom.
However, some flexibility could prove desirable; for example, over matters which do not directly affect pay (that is, different aspects of conditions of service) but which nevertheless have a relationship to the terms of service; and also to meet the special needs of health provision and to fix the pay of those small groups which are not covered by negotiated agreements—and these are more likely to be the ancillary workers than the professionals. Any waivers which are likely to be given under Clause 39 can be withdrawn or modified by notice in the light of the experience of their effect. It is not intended that the power to waive consent should lead to substantial differences North and South of the Border. There would be clear disadvantages in that for all concerned—for the Government, for the Scottish administration, for the medical professions and, not least of all, for the patients.
It is necessary now to give some inducement payments to doctors. For example,
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they have the same terms and conditions as other general practitioners except that they are in receipt of special payments for practising in the remote areas, where it is more difficult to get doctors. My understanding is that there are about 76 practices in Scotland at the moment in receipt of such payments and also a few practices in England and Wales. I believe they are probably about 10 in total. There are also a large number of doctors who need living accommodation or surgery provision in the more remote areas and many of these premises have been provided throughout the Highlands and Islands in recent years. They are normally rented by the doctors in practice from the appropriate health board who provided the premises. At present, because most practices have now been established we not see more than a few new premises of this type being required in any year. The Review Body will still be able to continue to operate as at present, and doubtless the Scottish Executive will be associated with the discussions following the review body's recommendations. So far as Lord Colwyn's suggestion about the block grant is concerned, there is no suggestion anywhere—I have heard of no suggestion—that it should be restricted in any way. I think I can give him that assurance.
It is Clauses 20 and 21 which confer the executive power of the devolved matters on to the Scottish Executive and Clause 59 which defines the devolved matters. These matters embrace the powers to fix the pay and pensions of groups of employees in the devolved fields either by identification of existing powers or because devolution of any matter includes all aspects of that matter, including the pay and pensions of persons concerned with it. Therefore, Group 1 of Schedule 10 (Health) carries with it the ability to fix the pay and pensions and related conditions of the people employed or under contract in this field. The Government feel that there should be some curb on the ability of the Scottish Administration to deal with pay in the field of health since it is important—and we recognise this—to retain the similarity in terms and conditions of service of doctors and others throughout the whole of the United Kingdom.
We want to do nothing which will weaken the unity of the profession or act as a bar to the mobility of employment, so the consent provision should be

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viewed as a necessary constraint to be exercised in the interests of the health professions throughout the United Kingdom. We believe this is a necessary power which we should have in the Bill but we believe also that we have the safeguards in that, if it is not being properly used, the waiver will be able to be withdrawn by the Government here.
Lord CAMPBELL of CROY: I am grateful to the other noble Lords who have taken part in this debate. My noble friend Lord Colwyn is himself a practising dentist; and I only hope that some of his patients have not suffered pain because of his arrangements to be here. The noble Lord, Lord Platt, too, spoke as a distinguished member of the medical profession. The noble Baroness, in replying, referred to other parts of the Bill that I know about; but what is worrying in subsection (3) of this clause is that there are the words
"notwithstanding anything in this Act".
That means that the consent can be given in such a way that, whatever else is in this Bill when it is passed, the question of salaries and terms of service for doctors, surgeons and dentists could be handled by the new Scottish Executive and Assembly separately from the central system which now exists.
The noble Viscount, Lord Thurso, raised a matter which I do not argue with at all; that is to say, there are different conditions for doctors working in different parts of the country. But that appears to be well looked after by the present system and taken into account. I think that there are probably more similarities between moorland and mountain areas in
Wales and Scotland than between the highlands of Scotland and its central urban areas. These differences of circumstances in which doctors and dentists practise are apparently well taken into account in the present system based upon the Review Body.
The noble Baroness said that it is the aim of the Government to try to achieve similarity still and that the review body would continue. But the fears of the medical professions are that, none the less, as drafted in this Bill, consent could be given so that their salaries and conditions of service were dealt with quite separately in Scotland. That is clearly written into the Bill. It is not just a question of undoing the work of the Royal Commission. Its report in 1960 led to the present situation, which is accepted and satisfactory. It means that the confidence in the system which has been built up around the Review Body as a result of the work of that Royal Commission would crumble. I believe, having attained this situation where there are no longer arguments of a major kind about the pay of doctors and dentists and it is working properly, that it is almost vandalism now to upset it. I feel very strongly about this, and the Government do not appear to be prepared to accept it. Therefore, I would ask my noble friends, and all Members of the Committee who agree with me, not to withdraw the Amendment.
6.16 p.m.
On Question, Whether the said Amendment (No. 361) shall be agreed to?
Their Lordships divided: Contents, 109; Not-Contents, 62.

CONTENTS

Alport, L.

Cork and Orrery, E.

Gridley, L.

Amory, V.

Craigavon, V.

Haig, E.

Auckland, L.

Craigmyle, L.

Hemphill, L.

Balerno, L.

Crawford and Balcarres, E.

Hertford, M.

Belstead, L.

Cromartie, E.

Home of the Hirsel, L.

Birdwood, L.

Cullen of Ashbourne, L.

Hylton-Foster, B.

Bradford, E.

Daventry, V.

Inglewood, L.

Bridgeman, V.

Dormer, L.

Killearn, L.

Burton, L.

Drumalbyn, L.

Kilmany, L.

Caccia, L.

Dundee, E.

Kimberley, E.

Campbell of Croy, L.

Ellenborough, L.

Kinloss, Ly.

Carr of Hadley, L.

Elles, B.

Kinnoull, E.

Carrington, L.

Elliot of Harwood, B.

Kinross, L.

Cathcart, E.

Faithfull, B.

Linlithgow, M.

Chesham, L.

Fortescue, E.

Long, V.

Clifford of Chudleigh, L.

Gisborough, L.

Lucas of Chilworth, L.

Cockfield, L.

Glenkinglas, L.

Luke, L.

Colwyn, L.

Gray, L.

Lyell, L.

McFadzean, L.

Perth, E.

Stuart of Findhorn, V.

Mancroft, L.

Platt, L.

Sudeley, L.

Margadale, L.

Rawlinson of Ewell, L.

Swansea, L.

Masham of Ilton, B.

Redesdale, L.

Swinfen, L.

Massereene and Ferrard, V.

Reigate, L.

Tenby, V.

Merrivale, L.

Rochdale, V.

Teviot, L.

Middleton, L.

Ruthen of Freeland, Ly.

Thurlow, L.

Mills, V.

St. Davids, V.

Torphichen, L.

Minto, E.

Saint Oswald, L.

Tranmire, L.

Monck, V.

Sandford, L.

Trenchard, V.

Monk Bretton, L.

Sandys, L. [Teller.]

Vernon, L.

Morris, L.

Selkirk, E.

Vickers, B.

Mottistone, L.

Sempill, Ly.

Vivian, L.

Mowbray and Stourton, L. [Teller.]

Skelmersdale, L.

Wakefield of Kendal, L.

Southwark, Bp.

Ward of North Tyneside, B.

Newall, L.

Stamp, L.

Wilson of Langside, L.

Northchurch, B.

Strathclyde, L.

Wise, L.

O'Hagan, L.

Strathcona and Mount Royal, L.

Young, B.

Onslow, E.

Strathspey, L.

NOT-CONTENTS

Aberdeen and Temair, M.

Hanworth, V.

Ponsonby of Shulbrede, L.

Allen of Abbeydale, L.

Henderson, L.

Rhodes, L.

Aylestone, L.

Houghton of Sowerby, L.

Shackleton, L.

Beaumont of Whitley, L.

Jacques, L.

Shepherd, L.

Blyton, L.

Janner, L.

Shinwell, L.

Brockway, L.

Kilmarnock, L.

Snow, L.

Brown, L.

Kirkhill, L.

Stedman, B.

Champion, L.

Llewelyn-Davies of Hastoe, B. [Teller.]

Strabolgi, L.

Chitnis, L.

Tanlaw, L.

Crook, L.

Lloyd of Hampstead, L.

Taylor of Gryfe, L.

Davies of Penrhys, L.

Lloyd of Kilgerran, L.

Taylor of Mansfield, L.

Douglas of Barloch, L.

Longford, E.

Thurso, V.

Elwyn-Jones, L. (L. Chancellor.)

McCluskey, L.

Vaizey, L.

Fisher of Camden, L.

McGregor of Durris, L.

Wade, L.

Foot, L.

McNair, L.

Wall, L.

Glenamara, L.

Maelor, L.

Wallace of Coslany, L.

Gordon-Walker, L.

Murray of Gravesend, L.

Walston, L.

Goronwy-Roberts, L.

Noel-Baker, L.

Wells-Pestell, L.

Hale, L.

Oram, L.

Willis, L.

Hall, V.

Paget of Northampton, L.

Wilson of Radcliffe, L.

Hampton, L.

Peart, L. (L Privy Seal.)

Winterbottom, L. [Teller.]

Wynne-Jones, L.

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

Resolved in the affirmative, and Amendment agreed to accordingly.
6.25 p.m.
[Amendments Nos. 153 to 155 not moved.]
Schedule 8 agreed to.
Clause 40 agreed to.
Clause 41 [Payments out of Scottish Consolidated Fund]:
The Earl of SELKIRK The Earl of SELKIRK moved Amendment No. 229:
>Page 21, line 21, leave out ("Act of Parliament or").
The noble Earl said: Clause 47 deals with payments out of the Scottish Consolidated Fund. The Scottish Comptroller and Auditor General may permit payments or credits to be drawn from it under three headings: a Scottish Assembly
252
Act, an order made by the Scottish Secretary or an Act of Parliament. I am asking here: Why is an Act of Parliament included under these headings as one of the grounds on which the Scottish Comptroller and Auditor General can allow payments to be made? I take it that these are specific payments for specific purposes by an Act passed at Westminster, and I presume they include a large number of things such as salaries, housing subsidies, National Health Service payments and, probably, education.
As I understand it the payments made under an Act of Parliament will be completely controlled by the terms of that Act. That means, in effect, that there will be no discretion whatever by the Assembly as to how that payment shall be used. In other words, this is simply taking the Scottish Executive to be something a little like the Paymaster-General;

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that is to say, he is a figurehead to whom payments are made for a variety of purposes. I want to make that quite clear, because we have been told sometimes that the Scottish Executive can do what they like with the money they are given. I thought that was the position and that the Scottish Secretary, with a Scottish Assembly Act would be the sole source from which money could be given from the block grant or indeed from the rates grant. I take it that it is not so. Would the noble Lord then confirm that in fact through the Scottish Secretary quite substantial monies will be paid over which he has no discretion and for which the conditions of payment are entirely laid down by Westminster? If that is not the case, then I think the words" Act of Parliament" should be taken out of Clause 41(2)(a). I beg to move.
Lord KIRKHILL: The noble Earl, in his usual most friendly manner, frequently assures me that I am less than helpful to him, but in an attempt to remedy the implied criticism (although very kindly uttered on all occasions) I can tell the noble Earl that on the Government's side we can appreciate the reasoning behind the Amendment. On the face of it, it is unreasonable that the Scottish Consolidated Fund should be burdened with expenditure arising from Acts passed by the United Kingdom Parliament. However, so far as existing United Kingdom Acts of Parliament are concerned, the clauses as presently drafted, I am advised, simply ensure that certain expenditures on devolved matters which fall on the United Kingdom Consolidated Fund will, after devolution, fall on the Scottish Consolidated Fund. Examples are the salary of the Commissioner of the Health Service in Scotland and certain sums relating to Civil Service pensions. The effect of the Amendment would be for such payments, after devolution, to continue to fall on the United Kingdom Consolidated Fund and I think your Lordships would agree with me if I make the point that that seems insupportable as a proposition.
So far as future Acts of Parliament are concerned—I realise the noble Earl did not touch on this point, but perhaps it is relevant to bring it to your Lordships' attention—any imposition of direct charges on the Scottish Consolidated Fund would have to be provided for in the Act con-
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cerned, and Parliament would be required to take a view on the provisions in question. The Amendment would not prevent Parliament from framing such legislative proposals if it thought fit to do so. I think that is as full an explanation as I can give of the Government's position on the noble Earl's Amendment.
The Earl of SELKIRK: I take it, then, that over parts of the block grant the Assembly will have no discretion at all. Clause 44 refers to a statement of the considerations leading to the determination of the block grant. Will those considerations say quite clearly over which part of the block grant the Scottish Assembly has no discretion whatever? I wonder whether that is in mind. Perhaps the noble Lord will give his views on that. But it seems to me that it makes the block grant rather empty, if the Scottish Assembly has no say whatever about the way in which that money is expended.
Lord KIRKHILL: Perhaps an element of confusion has arisen—purely on my side, I hasten to add. I shook my head as the noble Earl was speaking. But, clearly, I misunderstood the middle part of his remarks, because he then went on to ask me whether or not discretion would attend the Scottish Assembly when it considered the whole question of support grant. Undoubtedly, discretion will attend the Scottish Assembly at this point and, when the block grant is linked to the question of rate support grant and so on, long discussion and much dialogue will ensue. There can be no doubt about that.
The Earl of SELKIRK: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 41 agreed to.
Clauses 42 and 43 agreed to.
Clause 44 [Payments into Scottish Consolidated Fund out of moneys provided by Parliament]:
6.34 p.m.
Lord STRATHCONA and MOUNT ROYAL Lord STRATHCONA and MOUNT ROYAL moved Amendment No. 156:
Page 22, line 25, leave out ("from time to time") and insert ("every four years").
The noble Lord said: We are now moving into the purely financial section

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of the Bill and, at first sight, this Amendment may appear to be rather a narrow one. We are suggesting that we should take out the words, "from time to time" and insert "every four years". May I start by saying that this is purely a probing Amendment, and its terms have been taken from the White Paper Devolution: Financing the Devolved Services, of July 1977, where it was suggested that the allocation, the argument or the settling of the level of the block grant might reasonably go with the Assembly elections.
I should first like to ask the Government whether that is still their thinking. In any case, it seems to me that the expression "from time to time" is one of the most gloriously vague ones that we have had, and if we cannot be more specific it might be just as well to leave the words out altogether. But that is not the principal point that I am trying to make. In the White Paper, the Government went into some detail as to what they had in mind in July 1977, and our purpose is to try to entice them into letting us into their thinking a little more; how they think the arguments about the block grant might be expected to work.
I do not think that very many of these arguments are great issues of principle. However, I suppose it is fair to say that it is difficult to distinguish in this context between matters of principle and matters of practice; but I am mainly taking purely practical points here. I can see that when one starts to find out how this will work in practice, one may find oneself getting back to issues of principle. I suppose it is fair to say that this is not a unique situation, and it has been known to happen once or twice earlier on in this Bill. But I am not in any way attempting to make a Second Reading speech. I think it is generally agreed that to have an annual hassle has certain disadvantages. I have already explained why the time of four years has been chosen; simply because it was the one tentatively put forward by the Government in their White Paper. Whatever happens, it seems to me to be rather important that we should not end up with some kind of hiatus at the end of the period that we choose.
I have had no experience of local government, but I think that many noble
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Lords are aware of the ridiculous situations which sometimes arise, when local authorities are very busy trying to spend like mad in the last few weeks before the financial year comes to an end. Most of us have also had experience of the moments when local authorities completely run out of money. Not so long ago, there was a classic example in what was then called the County of Argyll, which could not issue fire certificates for hotels because it had run out of money with which to buy paper on which to print the certificates. That is a slightly extreme example, but many of us know that there are moments when either money runs short or there is a scramble to spend. Either way, it is a ridiculous situation which we do not want to perpetuate on a larger scale as between Westminster and the Scottish Assembly.
Certainly, I should have thought that, as regards capital spending—and I do not think there is very much distinction in the Bill between money allocated for capital purposes and money allocated for what one might call revenue purposes—it is extremely important to have some kind of rolling programme. I recall that this is a point which the noble Lord, Lord Goodman, used to make about Arts Council grants; that it is hopelessly unsatisfactory not to know for some fairly continuous period ahead what level of grant one can expect, and it is very important to be sure that the variations are not too sudden and unexpected.
If you work this through a little further, it is clearly important that the Assembly should have credibility with anybody with whom it will be dealing as a customer; for example, a contractor. If it is entering into a long-term project which might take some years, and there are to be progress payments spread over some years, it is important that everybody should have confidence that the Assembly will have the money to pay year by year, and that it will not suddenly be chopped. Any firm entering into a contract with the Government has to accept the fact that unfortunately Government contracts can be made meaningless by the power of Governments to abrogate contracts if they so please. Happily this is not something which very often happens. However, one can envisage the possibility of the Assembly committing itself to a line

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of capital expenditure and the Westminster Government then declining to continue to assist it in financing that line of expenditure. I am not suggesting that the Westminster Government would necessarily pick on a particular project, but they might say, "If you go on doing what you are doing and spending money in the way that you are, we shall not wish to continue to make it possible for you to do that, and we shall do our best to reduce the grant".
There is a further aspect. If money is spent in one year on, say, building a hospital, it is quite possible that one is then committing oneself to an annual expenditure in order to look after the place and run it thereafter. Therefore, the distinction between capital expenditure in one year and what then becomes a revenue outgoing in a subsequent year frequently is not all that clear. We are also moving into the dangerous situation, which has been alluded to so often, of Governments of different complexions being in office on each side of the Border. There could be a Socialist Government in Edinburgh and a Tory Government in the United Kingdom, and that Tory Government might wish to starve the Socialist Government. Tories are very generous chaps. Nevertheless, it could happen that they would wish to limit the activities of a Socialist Government in Edinburgh. In the opposite situation, there could be a Tory Government in Edinburgh and a Socialist Government in the United Kingdom. The Tory Government in Edinburgh would have no incentive to save because they would feel that any savings that they made would only make life easier for their opponents at Westminster. This would end up as a formula for profligacy, which I am sure would be totally unlikely to appeal to any Tory Government.
The White Paper of November 1975 postulated an annual bargaining session and spoke of information gathering without further defining exactly what organisation was envisaged for that purpose. The White Paper foresaw conflict as early as November 1975 by rather naively prefacing one of its paragraphs with the words, "With understanding". That was a very nice, hopeful idea, but I think that it would be unwise of us to legislate on the assumption that we can always rely on there being perfect understanding
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between the Government at Westminster and the Assembly in Scotland. So the Government have agreed, under pressure, to amend the system to cover a longer period.
The Government recognise the possibilities of argument in their White Paper of July 1977. In paragraph 2 they put forward the suggestion, and here I quote from page 15:
"of an independent advisory body which would collect such information and advise the Government and the devolved Administrations on its implications".
May I ask whether that is still the Government's plan? And if it is, would they like to tell us a little more about the kind of organisation they envisage and how it will operate?
I said that this was a question of practice rather than principle, and so it is. Really it comes better under the subsequent Amendment to make the point that, although it has been said that the block grant does not give to the Assembly any tax-raising powers, there is a slightly complicated way—and I might as well mention it now because it is relevant to the consideration of how the block grant is fixed—in which, in effect, the Assembly could find itself with a tax-raising power.
It would work something like this. Perhaps I ought to put it in the form of a question. Am I right in thinking that local authorities in Scotland will draw their rate support grants from the Assembly? I believe that I am right. And if I am correct, it postulates that in practice the Assembly could say to local authorities, "We are very sorry, but we cannot give you the kind of money which you need and hope to receive and that we all accept that you need. What, therefore, you will have to do is to go out and raise additional money, perhaps by increasing the rates". In a rather convoluted way, then, may I suggest that we are possibly giving a tax-raising power to the Assembly. This is an example of the kind of unhappiness that is created by the Bill, and it is very difficult to see how we are going to get away from it.
Having strayed slightly into the next Amendment, may I come back for a moment to the matter of the time-scale. If we adopt a four-year time-scale, bringing the negotiation of the block grant into phase with the Assembly elections—in passing, one ought to consider what happens if there is a special Assembly

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election, but I suppose that will not matter because the regular four-year cycle would continue and the extra Assembly election would not affect that problem—will create, I foresee, two further slight problems. Is there not a danger that Westminster might exert undue pressure upon the Scottish electorate during the Scottish Assembly elections by saying, "If you want us to be helpful about the kind of block grant we are going to give you when you get the new Assembly, you had better vote in the way that we should like to see you vote"?
A variant of the same idea is the situation in which people say, "Westminster does not much like the complexion of the new Government which has appeared in the Assembly. Look at what they have done to the block grant! Just out of pique they have chopped it". Alternatively they could say, "Westminster is delighted with the complexion of the new Assembly and they are going to give it a whacking great handout". This would not be a very happy situation, and one can see it being used as a lever of a rather improper kind in the Assembly elections.
The other point I wish to make is that possibly a four-year fixing of the block grant might be unduly restrictive upon the central Government's flexibility and speed of reaction. The noble and learned Lord will probably tell us that this is taken care of in the White Paper, again in paragraph 76, where it is suggested that the way in which the block grant would be fixed would in any case be in relation to the overall rate of expenditure in the United Kingdom as a whole. Therefore, if it were decided to have a major cutback, this would work through the system and automatically engulf the block grant as well. If I am right, that is perhaps not a very major objection. Nevertheless, I think that it is an objection. In moving this Amendment, therefore, I should be very interested to hear the comments which the Government have to make on some of the points I have raised. I beg to move.
6.50 p.m.
Lord SHINWELL: I must confess to some surprise that the noble Lord, Lord Strathcona and Mount Royal, should
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have taken the trouble and occupied so much time to discuss such a minor Amendment. I should have thought that by a close examination of the clause he would have discovered practically all he wanted to know. I entirely agree with him that the words "from time to time" are not altogether desirable. They are not up to the standard of literacy that one expects from those responsible for drafting Amendments, or even drafting the provisions of this Bill. But, on the other hand, to suggest that money should not be provided except in periods of four years would be to put a brake on the activities of the Assembly and I am quite sure that was not his intention.
Lord McCLUSKEY: I wonder whether my noble friend would allow me to say that I heard the noble Lord, Lord Strathcona and Mount Royal, say that this was simply a probing Amendment. Of course, although the wording of the Amendment suggests it, the noble Lord does not suggest that there should be a payment only every four years. I am quite prepared to deal with the questions that I was asked.
Lord SHINWELL: I accept the implied rebuke, but I understand that it is part of the tradition of this House, so long as democracy remains in this country, that one should be permitted to express one's opinions. It does not always satisfy those who sit, either temporarily or permanently, on the Front Bench, but we will let that pass. Except that I shall recall it on some future occasion and perhaps indulge in a little retaliation. In the meantime I just wanted to say, having heard the noble Lord, Lord Strathcona and Mount Royal, posing a number of questions, that I think that asking for a four-year lapse is asking a little too much. All I intended to do was to suggest that all that he requires could be met by excluding the words "from time to time" and letting the clause read as follows, if I may be permitted—with the consent of my noble and learned friend—to mention the matter:
"The Secretary of State shall make out of monies provided by Parliament payments into the Scottish Consolidated Fund of such sums as he may determine by order made with the consent of the Treasury".
That is all that is required. That would serve the purposes of the Scottish Assembly

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it would serve the purpose of the noble Lord, Lord Strathcona and Mount Royal, and it would make it unnecessary to indulge in much probing. Of course it may well he that my noble and learned friend intended to indulge in those observations himself. Perhaps I have anticipated him. To suggest that such a thing might happen is perhaps going a bit too far, and I say it with my characteristic modesty. We will leave it at that. I suggest that the words "from time to time" are undesirable and do not sound well in a Bill of this character.
This Bill contains many defects in vocabulary, in purposes and in many of its provisions, but this Amendment is certainly unnecessary. On the other hand, I believe that all that is required is provided in the language that I have used and is contained in the clause and that all we have to do is to accept it and then I think we should all be quite satisfied. I understand the time is coming when we may indulge in gastronomic exercise instead of indulging in this unnecessary debate.
Viscount MASSEREENE and FERRARD: I completely agree with the noble Lord, Lord Shinwell, that the words "from time to time" seem to be completely unnecessary and I suggest that they should be left out. I also thought that my noble friend was suggesting that the Scottish Secretary should pay the Consolidated Fund only every four years. I was amazed at that because I wondered how on earth the Scottish Secretary of State could know, when the first Assembly was elected, how much money would be needed for four years. He would have to be a clairvoyant. We do not want to get into the situation which sometimes happens with the Road Fund, where the county councils are allocated so much every year and then find that they cannot spend it all and they look round desperately for corners to cut in order to spend the money so that they do not get less next year.
Lord MIDDLETON: The trouble is that there is no satisfactory method whereby Parliament can provide the money for a Scottish Assembly to perform the functions given it in this Bill. The reasons behind the Government's preference for an expenditure-based system for
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financing and their rejection of a revenue-based system are set out in the White Paper. On the other hand, a system as in the Bill, whereby the devolved services are to be financed by block grants and handed over by Parliament from time to time (whatever that may mean), and whereby the Assembly has no money-raising powers of its own, is bound to lead to trouble of one kind or another.
I fear the divisive effect of a periodical wrangle in Parliament over the size of the block grant, because not only will that remind the English taxpayers that a sizeable proportion of any grant will come out of their pockets but it will also be only too easy for Members of the Scottish Assembly to whip up a feeling of injustice among their Scottish electors by blaming an English majority in Parliament for not providing large enough grants to finance the devolved services which are intended to make life better for the Scots. I hope it will not be an annual wrangle, but I really do believe that this would be putting too much of a strain on the unity of the United Kingdom.
6.58 p.m.
Lord McCLUSKEY: Until my noble friend Lord Shinwell spoke after I intervened I had not appreciated that dinner was so near, otherwise I would not, by intervening, have tempted him to go on even longer than he had intended. Turning to this particular matter and accepting the Amendment on the basis which was put forward by the noble Lord, Lord Strathcona and Mount Royal, if I may first take the words "from time to time" they are well precedented and I have been furnished with examples in 1965 and 1975. Of course, in the context of Clause 44 as one sees it they relate to payment and surely it is not too extraordinary, in order to emphasise the periodicity of the payment, to use the words "the Secretary of State shall from time to time make payments". So I would defend them in the context in which they appear in Clause 44.
Turning to the wider issues, the Government explained in the White Paper which has been referred to, Devolution: Financing the Devolved Services, their reasons for preferring an expenditure-based system to a revenue-based system for financing the devolved administration in Scotland.

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Under such a system all United Kingdom revenues continue to be pooled and are then allocated to different parts of the United Kingdom in accordance with relative needs. I want to emphasise this matter of relative needs because that goes to the heart of the whole thing and when the noble Lord, Lord Strathcona and Mount Royal, talks about the Westminster Administration punishing or rewarding the voters of Scotland because of the way they have voted in electing Members to the Assembly, I think he is ignoring the fact that the whole basis of the system is that an assessment is made of relative needs.
When he asks me, are the Government still thinking in terms of some independent body of the kind that was foreshadowed in paragraph 72 of the same White Paper, yes, the Government are thinking of that. I do not take the matter any further because, of course, this is a matter which ought properly to be discussed with the Scottish Assembly and Executive when the Executive is formed. We ought to discuss with them what form such a body should take, what its range of interests should be, what kind of staffing it should have and so on and so forth. So that is left over, but it is still very much in the mind of the Government that that system should be followed.
There is one other matter I might mention arising out of what the noble Lord, Lord Strathcona, said. He spoke of rolling programmes and the possibility that money might be surplus at the end of a period of time or that money might be short. Of course, so far as surplus monies are concerned the Government at Westminster have no concern with that. They assess what the block grant ought to be in terms of what the needs are, and will have no regard to the fact that there may, over a particular period of time, for accidental or deliberate reasons, have been some kind of surplus. So far as shortages are concerned, of course, the Government at Westminster will play no part whatsoever in determining the allocation of the block fund between the different votes, as it were, on which the Scottish Secretaries will have to pay out money, the different services that have to be financed out of the block grant. That is not a matter for the Government at Westminster at all. Of course, there
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is the possibility, under Clause 46, of short-term borrowing if the situation arose where they could not afford to print the paper, such as the noble Lord, Lord Strathcona, mentioned.
In relation to the general point, that there are opportunities for confrontation and disputes, one acknowledges that, and both the White Papers, the one referred to and the one of November 1975, acknowledged that. For reasons which were explained in the latter White Paper, the Government do not regard dispute as inevitable. The White Paper put forward three ways in which, in the Government's view, the working of the arrangements might be facilitated. By their nature we think that none of these proposals is suitable for incorporation in the Bill itself, for the same reason that I gave, that they are all dependent on the outcome of discussions with the devolved Administration in due course.
May I turn to the proposal which lies behind this Amendment, the proposal that there should be possibly a formula under which devolved expenditure, expenditure on devolved matters in Scotland, would be settled for a period of four years ahead as a percentage of comparable expenditure in the country as a whole. The Amendment—even accepting it on the basis put forward by the noble Lord, Lord Strathcona appears to derive from a misreading of the discussion which he will find in paragraphs 74 to 78 of that White Paper. The White Paper proposals concern a means of settling total public expenditure on devolved services, and that comprises rate-borne expenditure and capital expenditure met by borrowing as well as block fund expenditure. So all these elements go into the total public expenditure on devolved services. Whether block fund expenditure could also be fixed by a formula is a different issue, and that would have to be pursued perhaps with the Scottish Administration.
The type of formula envisaged in these paragraphs in the White Paper would, moreover, not fix an amount of money but merely a relationship between the total expenditure on the devolved services and comparable expenditure in the country as a whole; that is to say, the Government and the Scottish Administration would agree that for a coming period of years the total of public expenditure for devolved

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purposes each year would be X per cent. of the corresponding total elsewhere, whatever that total elsewhere might actually be. The Scottish total for each year as a sum would fall to be fixed separately each year by the operation of the formula, and the block fund component within it would he fixed separately each year by the House of Commons.
Lord STRATHCONA and MOUNT ROYAL: May I interrupt the noble and learned Lord, because I am not finding this terribly easy to follow? Is he suggesting that there will be certain sorts of expenditure which are not devolved but on which the Assembly will have a view, that they will be items of expenditure to be met by Westminster which they will discuss with the Assembly; then there will be a separate listing of those, and they will be added back to the block grant, and it is that final figure which is the one which we are talking about here?
Lord McCLUSKEY: The short answer to that is, No. What I am suggesting is that the block grant is only one part of the public expenditure which is being discussed in paragraphs 74 to 78 of the White Paper. What is under discussion in the White Paper is the total public expenditure on devolved services; that includes the block grant; it also includes borrowings; it also includes rate-borne expenditure in Scotland, because the block grant is only one part of that. I think perhaps this emerges more clearly from the discussion of the matter in the December 1975 White Paper, where there is a very full discussion of these particular matters.
As I say, the total of public expenditure on devolved matters, to try and answer it in another way, also involves other forms of expenditure. They are capital expenditure of local authorities and other public bodies which is met by borrowing; secondly, current expenditure of local authorities net of grant which has to be met by the levying of local rates; and, thirdly, of course, there is expenditure on devolved services which is met from the internal resources of public corporations. An example that comes to mind is a public corporation like MacBrayne's, who have an income, and of course that money falls to be spent; it is not in the block grant and it is additional to the block grant. So the block fund is only
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part of the money to be spent on devolved services in Scotland.
If I may go back to the questions I was asked, in so far as I have not already dealt with them, the noble Lord, Lord Strathcona, referred to the words "with understanding" which appeared in paragraph 105 of the White Paper of July 1977. I hope there will be understanding, but the White Paper was not as naive as he would have had us believe, because what was said was:
"With understanding on both sides agreement should usually be reached".
It went on:
"If agreement is not reached the matter will have to be settled by the Government, answerable to Parliament".
That is one of the reasons why one has to have proper representation of Scottish Members of Parliament at Westminster, so that the Government may be answerable to them as well as to the other Members on matters of this kind. The noble Lord also referred to tax-raising matters. I wonder if he would agree with me that perhaps we should look at that when we come to the appropriate Amendments. I think I have endeavoured to answer all the questions I have been asked.
The Earl of SELKIRK: Might I ask the noble and learned Lord one question. He has emphasised relative need, but he seems to have made no provision for supplementary estimates. Every year one or other of the Departments at Westminster demands a supplementary estimate. This is not necessarily due to excess expenditure. It may well be due to the fact that work is completed more quickly and therefore has to be paid for—materials and wages. I wonder whether the Government have in mind any consideration for that. That will inevitably arise, and I wonder how in the Government's mind it is proposed that that should be dealt with.
Lord McCLUSKEY: I am delighted to answer that. The wording of Clause 44, in our view, allows the payment of supplementary sums. Looking at Clause 44 we see:
"The Secretary of State shall from time to time make…payments into the Scottish Consolidated Fund".
He is entitled to make such payments as are approved in the way envisaged in the

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Bill. So, as we see it, what will happen will be that there will be negotiation on the block fund, whether it takes place once every 12 months or every 4 years, or whatever period may be agreed between Westminster and the Executive, but the payments that may be made are covered by Clause 44. If circumstances arise in which it is desired to make supplementary payments, they may be made under Clause 44.
Lord STRATHCONA and MOUNT ROYAL: The noble and learned Lord is being extremely enlightening and helpful. I do not know that I understood exactly what he told us, but I shall read it with great interest tomorrow morning in Hansard.
It is with some trepidation that I allow MacBrayne's to come between me and my dinner, since I am highly dependent upon that noble company, as the noble and learned Lord probably knows. However, I should like to ask him one further question. I quite see that there is the income side of MacBrayne's. To take MacBrayne's, or any other organisation of that sort which has to be subsidised and which therefore requires some money to be put into it somewhere, I had imagined that the Assembly, if it were responsible for something like MacBrayne's, would, when it came to ask for its block grants each year, produce a list of items on which it thought it would have to spend money, and would end up by saying "So you see, Westminster Treasury, we shall require X millions". I should have expected them simply to say, "MacBrayne, deficit".
If I understood the noble and learned Lord correctly, he said that he wanted to see both sides of the balance sheet. He will want to see the income from MacBrayne. That will be part of the fact-finding activity that will go on. This is where I got into some difficulty about the whole area that was going to be covered. If we are simply talking about totting up the various items which will cost money, that is what I imagine the process would look like. Now he has apparently led us into saying, "No, we shall go further and talk about the various forms of income which the Assembly will have as well". Clearly, in Scotland as a whole, there will be income to the Govern
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ment, from rates, for example. There will be income from Government-controlled services. I fully appreciate that. It may well be that I have not listened carefully enough to what the noble and learned Lord said, in which case I apologise.
The other matter as regards which I wished to draw him on slightly was this. I accept that he is not going to write into the Bill how often the block grant negotiations will take place. But I did understand him to suggest that he would imagine that this was normally an annual function like any other Treasury Department negotiation, or was he going to say that it would literally be like any Treasury matter which crops up from time to time, as it says in the Bill?
Lord McCLUSKEY: If I heard the noble Lord, Lord Strathcona and Mount Royal, correctly on the last point, the timing of these matters will be resolved after negotiations with the Scottish Administration. It may be that it would start off as a 12-month negotiation. It may be that experience would demonstrate that that was far too frequent. But these are matters for discussion.
In relation to the first point raised by the noble Lord, I should like to refer him to paragraph 111 of the November 1975 White Paper, Command Paper 6348, where there is some reference to other sources of finance. However, I hope that he has not been misled by any reference I have made to MacBrayne's. I think that he will find upon consideration of what I have said and of the passages in the White Paper dealing with other sources of finance, that what I said is correct.
Lord STRATHCONA and MOUNT ROYAL: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord WALLACE of COSLANY: My Lords, I beg to move that this House do now resume.
House resumed.

CONSUMER SAFETY BILL
Brought from the Commons; read 1ª, and to be printed.

MEDICINES (RADIOACTIVE SUBSTANCES) ORDER 1978
7.14 p.m.
Lord WELLS-PESTELL Lord WELLS-PESTELL rose to move, That the draft Medicines (Radioactive Substances) Order 1978, laid before the House on 11th April, be approved. The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper. In the wake of Mr. Justice Parker's Inquiry into the proposed processing of nuclear waste at Windscale it is perhaps appropriate that I should ask your Lordships to consider this draft Statutory Instrument. Like most nuclear matters the subject is somewhat technical and complex, and I must ask your Lordships' forbearance for going into some necessary detail.
Let me be perfectly frank. This order is extremely difficult to understand. I would not presume to feel that I have mastered it in its entirety. The order is one of three Statutory Instruments required to implement Article 5(a) of Directive 76/579/Euratom adopted by the Council of the European Communities on 1st June 1976. I shall return to the other two Instruments at a later stage.
The Euratom Directive lays down the revised basic safety standards for the health protection of the general public and workers against the dangers of ionising radiation. Most of the Directive is concerned with the reporting and authorisation of he production, processing use and disposal of radioactive substances, the limitation of radiation doses to exposed workers and other persons, and measure for the medical surveillance of radiation workers and the protection of the health of the population. Member States of the European Community, including the United Kingdom, are required to put into effect the necessary measures to conform to the relevant parts of the Directive within two years; that is, by the middle of this year. In so far as legislative action to implement the rest of the Directive is necessary, this will he introduced in due course by the appropriate
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Departments of State, but my concern in respect of the present order is solely with Article 5(a) of the Directive.
Article 5(a) reads as follows:
"Apart from the prohibitions provided for by national law, and irrespective of the degree of danger involved, a system of prior authorisation must be applied in respect of:
a. the administration of radioactive substances to persons for the purposes of diagnosis, treatment or research".
We are thus concerned with the use of radioactive substances for medical, including medical research, purposes. That is what Article 5(a) is all about—medical, including medical research purposes.
The present system, as many of your Lordships may well he aware, is that there is already a voluntary system of application for approval to undertake the administration of radioactive substances, mainly for research purposes, which was originally set up by the Medical Research Council and is now operated by the Department of Health and Social Security on the advice of its Isotope Advisory Panel. It is not at present obligatory for practitioners either to seek approval or advice, or if it is sought, to act upon it.
If I may come to the proposed regulations, since a voluntary system of approval is insufficient to implement the provisions of Article 5(a) of the Directive, it is necessary to introduce an obligatory system. After careful consideration and discussion with appropriate professional organisations we propose to follow the customary course by, as far as possible, making use of powers which are already available under existing legislation.
Section 60 of the Medicines Act 1968 enables regulations to be made prohibiting the administration and the sale and supply of specified medicinal products or classes of such products, except by registered doctors or dentists holding a certificate issued for the purpose of Section 60. Such regulations, which are subject to Negative Resolution in both Houses of Parliament, will therefore be laid before this House in the near future. I am now dealing with the order; the regulations exile later. They are the second of the three associated Instruments to which I have referred.
As the text of these regulations refers to the order which is now before your Lordships, it is not yet possible formally

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to lay the regulations which, as I said a moment ago, will be made under Section 60 of the Medicines Act, in this House but draft copies of them are available for consultation in your Lordships' House. I think that it is right to draw your Lordships' attention to these draft regulations as their existence is the main reason for the introduction of the order which is now before the House.
I should like to turn to the necessity for the present order. We have been at some pains to try to make it understandable for me, if not for your Lordships. The reasons for this order are somewhat involved. I shall therefore tabulate them in order to be of some assistance to the House: 1. The Euratom Directive requires radioactive substances which are administered to be subject to prior authorisation; 2. The Medicines Act which is being used to provide such authorisation applies to "medicinal products"; 3. Not all the radioactive substances which are to be authorised are "medicinal products" within the meaning of the Medicines Act; 4. Section 104(1) of the Medicines Act allows specified provisions of the Act to apply to substances or articles which are not medicinal products; 5. The present order specifies those substances and articles and the provisions of the Act to which they are to be subject.
I turn to the specified provisions of the Articles which I shall take under four separate headings. The specified provisions of the Act are principally those contained in Section 60 under which the regulations, to which I have already referred, are to be made. The specified articles or substances are as follows: First, appliances which already contain or are to contain a radioactive substance and are designed to he placed in the human body or body cavities; secondly, applicators which already contain or are to contain a radioactive substance and are designed to be placed on the surface of the human body.
Then, thirdly, apparatus used for the diagnostic technique known as "neutron activation analysis". This technique is used to determine the elements making up parts of the body. The elements are exposed to neutrons generated by a machine and so become radioactive and emit gamma rays. These rays are measured and thus make it possible to identify
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the elements emitting them. Since the technique requires the exposure of the body to the emission of neutrons from apparatus, the definition of "administration" in the Medicines Act has to be extended by Article 2(2) of the order to include this particular process. Fourthly and lastly, radioactive substances used for research rather than diagnostic or therapeutic purposes.
Your Lordships will note that teletherapy sources, particle accelerators and X-ray apparatus are not included in the Schedule to the order and consequently will not come within the scope of the regulations. The main reason for this is that we interpret Article 5(a) to refer to radioactive substances which can be retained within the body either biologically or mechanically, and thus to exclude radiation from machines where the radiation ceases as soon as the machine is stopped or turned off.
I should perhaps for completeness mention to your Lordships that the third of the Statutory Instruments is an order made by the Health Ministers under Section 4 of the Medicines Act 1968. The order provides for the establishment of a Committee on Radiation from Radioactive Medicinal Products to provide advice on the radiation aspects of medicinal products to the licensing authority responsible for granting product and manufacturers' licences under other provisions laid down in the Medicines Act 1968. The order does not have to be laid before this House, but a copy is available in the Library should your Lordships wish to examine it.
I should like to recap for a moment because I think that the matter may be becoming rather confusing. The present order is the matter before your Lordships which will require your Lordships' approval. The order will require regulations to be made. They will be made under Section 60 of the Medicines Act —which already provides the machinery to allow regulations to be prepared—and they will be subject to the Negative Resolution procedure. I have already said that the third of the Statutory Instruments dealing with the Committee on Radiation from Radioactive Medicinal Products does not have to be laid before your Lordships' House. However, as I have said, a copy is available in the Library.
In view of the seriousness of this matter I should like to say something about the consultations which have taken place. I shall deal with the matter in a general way, but I shall be specific if I am asked. I should like to assure your Lordships that this order and the other two associated Instruments have been the subject of widespread consultation with the Medicines Commission, and all the professional organisations and institutions representing the dental and medical practitioners and other scientists who are likely to be affected both within and outside the National Health Service. This consultation has been continuing since the Directive was issued and has included the circulation of the draft documents on two occasions. Indeed, the submission of the documents for Parliamentary approval has been delayed in order to take account of further recent representations made to my Department. We now consider that the draft order is in a form which is acceptable to the main professions and organisations who will be affected by it, and will intrude as little as possible into the freedom of clinical practice, while at the same time fulfilling the United Kingdom's obligations under the Euratom Directive.
Your Lordships may wish to know the timetable proposed by Health Ministers for the implementation of the provisions in this order and the regulations to which I have referred. The present order will be made as soon as the necessary Resolutions have been passed by both Houses, and it is expected to come into effect in July of this year. The regulations will be made at the same time as the order and, once approved, will require all medical and dental practitioners wishing to administer radioactive medicinal products—including the items covered by the present order—after 1st January 1979 to hold a certificate authorising them to do so.
I do not think that I can say anything more that is likely to be useful. I have tried to set matters out in as much detail as possible. I commend the draft Medicines (Radioactive Substances) Order to your Lordships for approval.
Lord DAVIES of LEEK: My Lords, before my noble friend sits down I should like to ask him one question. I did not hear him mention veterinary surgeons.
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The use of radioactive isotopes, is extending. Does the order include veterinary surgeons?
Lord WELLS-PESTELL: My Lords, my understanding is that the order deals only with doctors and dentists.
Lord DAVIES of LEEK: My Lords, radioactive isotopes are now also used in the treatment of animal health.
Lord WELLS-PESTELL: My Lords, there are other ways in which they can be brought in, but they are not involved in this particular order.
Moved, That the draft Medicines (Radioactive Substances) Order 1978, laid before the House on 11th April, be approved.—(Lord Wells-Pestell)
7.32 p.m.
Lord SANDYS: My Lords, the House will be grateful to the noble Lord, Lord Wells-Pestell, for explaining this very complicated order, which will have the object of completing the United Kingdom's obligation under the Euratom Treaty. I am not surprised that the noble Lord, Lord Davies of Leek, had a number of questions to ask prior to the noble Lord, Lord Wells-Pestell, sitting down because the order gives rise to a great number of inquiries. However, first, naturally, as we have been told, the order requires regulations to be made under Section 60 of the Medicines Act. The more detailed matters will come forward in these regulations. This follows upon a voluntary system which has been in operation for some years. It must be a matter of pride to us all that one very prominent hospital—the Hammersmith Hospital—has been using radioactive isotopes for medical therapeutic reasons for more than 25 years. Of course, that has been subject to an existing system of control.
The necessity for the present order we know, but there is one matter about which I should like to ask the Government—that is, whether the consultation has been concluded with the Health and Safety Executive Committee in regard to the question of the regulations. I hope that as the draft order has been stated to be acceptable to the professional bodies involved. we may have Government confirmation that, among the other bodies

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concerned, the Health and Safety Executive Committee has been fully consulted. It is, of course, a matter of considerable concern to Departments other than the Department of Health. As the noble Lord rightly pointed out, the inquiry at Windscale has given rise to great public anxiety on this whole matter, about which I hope the Government will be able to reassure us in the reply which we now await.
The Marquess of LINLITHGOW: My Lords, I should like to ask a simple question because the complications of this are way over my head. The very last sentence of the noble Lord, Lord Wells-Pestell, was that under the new regulations the users of these various complicated chemical compounds will require a certificate. There is a great deal of paper around nowadays. Can the noble Lord assure us that the ability to obtain a certificate and the actual obtaining of it will be simplified as much as possible? —because at the moment, from hearing what the noble Lord said, one does not know how a certificate is obtained and where it is to be obtained. Perhaps the Minister can assure us on that basis.
Lord WYNNE-JONES: My Lords, there is one question which I should like to put to my noble friend—namely, whether the societies which are concerned with the exact definition, and not simply with the ultimate purpose of something, have been consulted. Have the Chemical Society and the Royal Institute of Chemistry been consulted? There is an expression here which I cannot believe any chemist would accept: that is, "radioactive substance" means:
"any substance that contains one or more radionuclides".
The definition of a "substance" in chemistry is absolutely precise; there is no ambiguity about it at all. It does not mean a mixture; it means one substance, a chemical compound. To use the word "substance" in any order, any Act of Parliament or in any other way, I would submit is an abuse of language. Here it is suggested that any mixture of radionuclides can be called a "substance". But chemically that is absolutely unacceptable. I hope that when the Government introduce any order, they take the advice of those who are competent in this
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field. It is perfectly true that medical societies are competent to advise as to doses of radioactive materials, but they are not competent to decide whether any particular material is a "substance". This is something which is clearly a matter of definition. The definition is that a "substance" is something which is made of one or more chemical elements and has a defined chemical constitution; otherwise it is not a chemical substance.
Therefore, I should like to ask my noble friend whether the advice of competent chemical authorities—among which I would include the Chemical Society and the Royal Institute of Chemistry—has been taken in this matter. If it has not, I would suggest that the word "substance" be replaced by the word "material".
7.39 p.m.
Lord WELLS-PESTELL: My Lords, first, I should like to attempt to answer the question put to me by the noble Lord, Lord Sandys. Consultation has extended over the widest area I have yet met, something like 51 organisations, including the Medicines Commission, the Isotope Advisory Panel, the British Medical Association, The Standing Medical Advisory Committee, the Medical Research Council, the five Royal Colleges which would he involved, 13 other professional bodies—I shall not go through them all, but they include the Association of Clinical Biochemists, the College of Radiographers, and so on—five of the leading pharmaceutical organisations, the Dental Association and the dental radiologists making another two, and then exactly 20 other bodies, including the Health and Safety Executive.
Lord SANDYS: My Lords, I wonder whether it would be for the benefit of the House, and also the public at large, if the Government were willing to publish the full list in Hansard? It might enable the noble Lord, Lord Wynne-Jones, to know a little more about where the Government had directed their consultations.
Lord WELLS-PESTELL: My Lords, like any other Minister, I am always in the hands of your Lordships' House. If this is the wish of your Lordships then of course we shall see that it is implemented. I do not know that I can satisfy

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my noble friend Lord Wynne-Jones about the particular professional association to which he referred, but he will be able to see the organisations that we have consulted.
I have to say that we have no jurisdiction or control over the terminology. This is laid down in the Directive of Euratom, and this is something we have to accept and cannot do anything about. It is not a very satisfactory answer to him, but that is the situation. With regard to forms, we do not like them any more than the people to whom we have to distribute them. It makes a lot of work for Government Departments. We are anxious to see that the most simple form is available. We have to send out things to doctors and dentists in the ordinary way and we do not envisage that this is going to be a major job either for them or for us. We are very conscious of the fact that we do not really want to add more forms unless it is absolutely essential.
7.43 p.m.
Lord O'HAGAN: My Lords, before the noble Lord finally sits down, may I say that I understand that his answer to his noble friend Lord Wynne-Jones, who is an acknowledged authority on chemistry, was that the fault lay not in Her Majesty's Government's order now before the House but in the parent legislation, as it were, that was coming from the EEC. Therefore, as it was something that flowed from Community legislation, nothing could be done about it in the order now before your Lordships, or by Her Majesty's Government, because the time had gone. Would the noble Lord be prepared to say that, if this Instrument we are now discussing is part and parcel of a defective Directive which has been agreed in the Council of Ministers, the Government will do something about correcting that Directive itself?
If it is wrong for us—and I am no authority on the chemistry in question; I have the massive intellectual resources demonstrated by an O-level in biology—could it not be taken up by the Government with our partners in the Community and the Commission be asked to bring in a new Directive using the correct terminology? I am not trying to be awkward, I can assure the noble Lord; I am simply saying that, if that is where the fault lies, let us get it right at the Community level.
Lord WELLS-PESTELL: My Lords, I do not know to what extent it is of great significance. I have the experience of my noble friend behind me who is undoubtedly well qualified in this field, and r think that most people know his reputation. This is a matter that I would obviously take back and look into, but if we take some action in the matter I do not know to what extent it will affect the timetable of this order. It has to be brought in within two years. We have only a comparatively short space of time, until about July, and then it has to become effective in January. I do not know to what extent it will threaten the order itself.
I should hope that your Lordships would feel that you could accept the order because the order itself is important. It is going to do an important task. It is going to control things that I think every one of us would agree need to be controlled. If you can accept it on that basis I shall certainly see whether an inquiry could be made into the validity of doing something about the terminology.
Lord WYNNE-JONES: My Lords, before my noble friend sits down, may I ask him whether it is possible for an inquiry on this matter to be made of competent chemical authorities? I agree with him entirely that it is highly undesirable to hold up any order of this sort, and I would not for one moment propose that. However, I feel that it is a pity if we use wrong terminology because this may have repercussions in the future.
Lord WELLS-PESTELL: I can only give the assurance that I have already given; that is, that I shall certainly take it back and discuss it with my rigat honourable friend to see whether there is something of very great significance in this. However, I am anxious that the order, which is an important one, should not be held up.
Lord WALLACE of COSLANY: My Lords, I beg to move that the House do now adjourn during pleasure until 8.15 p.m.
[Sitting suspended from 7.45 p.m. until 8.15 p.m.]

SCOTLAND BILL
House again in Committee on Clause 44.
The Earl of SELKIRK The Earl of SELKIRK moved Amendment No. 298:
Page 22, line 27, after ("sums") insert (", including grants under section 63 below.").
The noble Earl said: We continue to deal with what are called the financial provisions of the Bill. This part of the measure was not examined at all by the other place. We are therefore entitled to ask for as much information as possible on how the financial side of these proposals is to be handled. I should like to know, first, why the rate support grant, which is in Clause 63, is not in the financial part of the Bill but among the miscellaneous provisions. Surely this is closely connected with the other financial provisions, and indeed is an integral and vital part of them?
I am wondering, too, why it is not dealt with on the same basis as what we have previously been discussing as the block grant. In fact, does the rate support grant form part of the block grant? If so, what part? I note that the rate support grant is made under certain local government provisions—the 1966 Act and the 1975 Act. That seems to be dealt with in an entirely different way, and, so far as I can see, is not covered by the rather slender conditions which are provided for in Clause 44.
In that clause the block grant has to be accompanied by a statement of the considerations which have led the Secretary of State to set the block grant at that figure. There is no such provision in Clause 63. There is no provision as to whether the Secretary of State states the considerations; and there is no suggestion, as it stands, that it should be subject to an order in the other place. It would seem important that these should be taken together. I suppose the rate support grant is about £1 billion—I am not certain of the figure—and I daresay it represents a substantial percentage of the block grant. Why are they not taken together and what are the considerations involved in their having to be taken separately?
There is a further question in this connection. Admittedly, there are differ-
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ent considerations applying to both, except that the funds must be provided by Parliament; yet they both—certainly the rate support grant—will inevitably cover a substantial number of reserved subjects. As can be seen from Schedule 15, there is a list of reserved subjects—the reserved functions of local authorities and other bodies—and they are all covered by the rate support grant. Many of the 25 or so subjects are in fact reserved functions, yet they will be paid for by the Scottish Secretary, and presumably after a discussion in the Assembly. How is it proposed that that should work? Is it to be handled entirely separately? I presume that it will be an annual grant. We do not yet know whether the block grant will be annual, but I must assume that the local authorities will need to have their rate support every year. It seems to me integral to Parliament that they should know that funds are being made available to the Scottish Assembly under both headings.
I take it that the rate support grant will be paid into the Scottish Consolidated Fund, and that those in charge of the fund will then be responsible for disbursing it. What discretion, if any, will there be in the allocation of those funds? Many of these functions are extremely important. The first on the list in Schedule 15 is "police (including police houses)", and there are a number of others which I need not go into here. All these have to be supplied, so far as I know, by the Scottish Secretary. I suppose that they will be allocated for different purposes. The Scottish Secretary will have to make his case to the Treasury on behalf of the local authorities on exactly what payments are to be made, and he will have to justify the requests for the amount required.
Why is this matter not included in the financial provisions? It is one of the most important financial aspects of the Bill, and is an integral part of the financial arrangements which are to be made. Is this matter intended to be dealt with together with the block grant, or are these two items to be dealt with separately? If they are to be dealt with separately, can we please be told how the rate support is to be dealt with, if it is not equally well to be dealt with under Clause 44, which seems to me the right place to deal with it. I beg to move.
8.22 p.m.
Lord KIRKHILL: I want to respond initially to the first and principal question put by the noble Earl. He is asking—perhaps I might paraphrase—why is Clause 63 where it is? The answer to that is that rate support grant is not part of the arrangements for funding the Scottish Administration through the block fund. It arises as part of the spending of the block fund. It is thus a miscellaneous matter arising from the devolved matter in Group 5 of Part I of Schedule 10.
But the block fund will include provision for the payment of rate support grant, and it will be open to the Scottish Administration to decide to give financial assistance to local authorities from some future date in some other way than through the medium of the present rate support grant system. But certainly to begin with they will have to operate the present system. However, no matter how they decide to do it, the need to give subvention to local authorities' current expenditure will continue to be a major consideration in the determination of the block fund. Your Lordships will know about this because the matter has been discussed on a previous Amendment when the discussion at one point ranged between my noble and learned friend Lord McCluskey and the noble Lord, Lord Strathcona and Mount Royal.
The total of devolved public expenditure, and the amount of the block fund will be negotiated between the United Kingdom Government and the Scottish Administration. The method of determining the block fund will have to be discussed and agreed with the Administration, but it may be possible to devise a formula approach to this also. It is the Government's intention that the consultations with the Scottish Administration will take place on a virtually continuous basis, and not as a series of disconnected, highly political confrontations.
With regard to expenditure by local authorities on reserved functions, as my right honourable friend the Secretary of State for Scotland said in another place, there are certain functions—and the noble Earl has just touched upon this—listed in Schedule 15 which will remain with the United Kingdom Government, but which will have to be financially supported in the same way as they are supported at present.
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The rate support grant is of course a general, and not a specific, gra it. Once the grant is paid, individual local authorities are free to use it in any way they wish. This is the essence of the grant and something to which local authorities rightly attach considerable importance.
Support for the reserved services, therefore, in common with that for devolved services, must come from the general support given through the rate support grant system. Since reserved functions as a whole amount to rather less than 10 per cent. of total local authority expenditure —and most of it is on police and traffic wardens, as the noble Earl has just mentioned—the Government consider it unlikely that any significant differences will arise with the Scottish Administration, or the Convention of Scottish Local Authorities, over the allowance to be made for reserved functions when the rate support grant is fixed.
Finally, there is the provision in Clause 63(2) which obliges a Scottish Secretary to have regard to such considerations affecting reserved functions as the Secretary of State for Scotland brings to his notice after consultation with local authority associations. I hope that that answers the points put to me by the noble Earl.
The Earl of SELKIRK: In that case the noble Lord should accept my Amendment. That is the simple answer to this. I am concerned that it is made clear that the rate support grant is included. I, in my ignorance, reading the Bill, seeing two separate paragraphs in totally different parts of the Bill, imagined that they were not connected. I cannot see why what I propose should not be included. It would make the Bill clearer, simpler and comprehensible. It would not injure the Government, or anybody. I am all for comprehensibility in Acts of Parliament. There is another point on which I should like to press the noble Lord. He says that there is no specific grant at all. This is a radical change, because there have been specific grants—
Lord KIRKHILL: Perhaps I expressed myself in a less clear manner than I intended. I was suggesting to the noble Earl that the rate support grant is not a specific grant. It never has been. It is a general grant. That is the point I was trying to make.
The Earl of SELKIRK: With great respect, is that true? Certain items in the rate support grant are specific. I always understood, subject to correction, that police grant was specific. There are one or two others with which I am not familiar. Is the noble Lord saying that this is a general grant covering devolved and reserved subjects, and that the Assembly, and indeed the local authorities, are perfectly free to spend as much or as little as they like? Is that really the position? If it is, it undermines the whole concept of reserved and devolved subjects in local government.
Lord KIRKHILL: The present position is that rate support grant is a general grant. Within the calculation authorities are thereafter free to determine their own priorities. That is the present position, and it certainly will be the position as the Assembly gets under way, no matter what may happen in the end.
Lord HARMAR-NICHOLLS: Does the grant go direct to the local authorities, or does it go through the Assembly or the Executive?
Lord KIRKHILL: I am sorry; I do not quite understand the point the noble Lord is making.
Lord HARMAR-NICHOLLS: Does the rate support grant go direct to whoever is to spend it, or does it go through the machinery of the Assembly?
Lord KIRKHILL: It will go through the machinery of the Assembly to the local authorities concerned.
Lord HARMAR-NICHOLLS: So the more the local authority gets, the less the Assembly gets on the block grant? Is that really what the noble Lord is saying?
Lord KIRKHILL: The Assembly will be discussing with local authorities the extent of rate support grant, as, for instance, at the present moment the Secretary of State so discusses with local authorities.
Lord CAMPBELL of CROY: I might be able to help overcome a misunderstanding which I think may have arisen between my noble friend Lord Selkirk and the noble Lord. As the noble Lord said, once the local authorities have
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received the rate support grant, they are able to allocate it between different services. But the process of calculation of the grant is such that the Government go into protracted negotiations in Scotland —through the Scottish Office—with the local authority representatives (now the Convention which represents them all) and they work out very carefully exactly how much they are to spend on education and their other services as the justification for the resulting figure that is determined. In practice, it is not easy for them to depart greatly from the allocation because that has been the basis of the negotiation which has arrived at the total sum. I hope I have been able to assist what appears to me to have been a misunderstanding.
Lord KIRKHILL: I can understand what the noble Lord, Lord Campbell of Croy, from his vast experience is saying, and can only re-emphasise that no change is being proposed; it is a continuance of an ongoing process.
Baroness ELLIOT of HARWOOD: May I ask the noble Lord a question? I remember over very many years of my life in local government having meetings of all the committees in about January or February and putting in the amounts we wanted from the general fund. That went to the Scottish Office for negotiation. It took three or four months in order to get what one wanted. I cannot believe that that will take place without any relation to what is required. It must take place.
The real point is, will it be with the Assembly or with the Secretary of State? If it is to take place with the Secretary of State it remains very much the same sort of thing that has been done for years and years. If it is to be with the Assembly, and then in the end has to be approved by the Secretary of State, we are inserting another tier of people who have to be involved, which, in my opinion, is quite unnecessary. The noble Lord keeps saying that this is a grant with which one can do anything. Frankly, it is nothing of the kind. It is a grant that one gets because one has put up what one hopes are extremely good schemes. One then gets the money for them. One cannot get a large sum of money without going into every detail of every single committee.
Lord KIRKHILL: In response to the noble Baroness, Lady Elliot, as she will know, the present position is that the Secretary of State for Scotland negotiates in a number of different consultations with the Convention of Scottish Local Authorities in determining the extent of rate support grant. When a Scottish Assembly gets under way, it is envisaged that the rate support will be part of the devolved consideration, and of course the new Scottish Administration will be involved in that type of discussion. There can be no question of the discussion ceasing.
Baroness ELLIOT of HARWOOD: The money will still come from Westminster.
Lord KIRKHILL: The Secretary of State will make arrangements under Clause 44.
Lord DRUMALBYN: The answer to my noble friend Lord Selkirk is, I venture to suggest, that Clause 44 in general is just an enabling clause conferring power upon the Secretary of State, with the consent of the Treasury, to make payments. How those payments are made up is as may be determined by order made with the consent of the Treasury. It is a normal empowering provision which is always necessary if the Treasury is to make payments.
Lord KIRKHILL: I agree with what the noble Lord, Lord Drumalbyn, has said. In my reply to the noble Earl I was attempting to explain how I saw the thing working. This was my attempt to open the door, as it were, to indicate how it works at the moment and how it will work.
Lord MACKIE of BENSHIE: Is the Minister saying that the Secretary of State will negotiate the block grant with the Treasury and that the Assembly will not negotiate with the Treasury for the block grant? Is it that negotiations will be done with the Secretary of State?
Lord KIRKHILL: I do not understand the difficulty expressed by the noble Lord, Lord Mackie of Benshie. I thought I had explained the position fairly and clearly. Can he elaborate his point to me?
Lord MACKIE of BENSHIE: I should have thought that the Assembly itself should have some say in the negotiations over a period, taking into account the historical condition of Scotland and the amount of money that has been paid in the past, the burden they will have to bear in the future and the per capita situation in the rest of the United Kingdom. This must be a subject of negotiation in which the Government of Scotland will be involved for the block grant. The whole purpose of the block grant was that, after reasonable negotiation, responsibility would be borne by the Assembly for the amount of money. I misunderstood the Minister if he said that these negotiations would be carried out by the Secretary of State.
Lord KIRKHILL: I cannot recall my exact phraseology of a few moments ago but there can be no question but that the Scottish Executive will be very much involved in these negotiations. There can be no question of setting the Executive on one side. I hope I did not convey that impression and, if I did so, of course I withdraw.
Lord HARMAR-NICHOLLS: This does not clear away the problem. My noble friend Lord Selkirk has clarified my mind in saying that the rate support grant has got to come out of the block grant.
Lord McCLUSKEY: The mover of the Amendment has failed to grasp the fact that sums are paid out of the Scottish Consolidated Fund. The noble Lord, Lord Drumalbyn, stated it correctly when he said that sums are paid into the Scottish Consolidated Fund and sums are paid out of the Scottish Consolidated Fund, but when they go into the Fund they lose their identity and just become part of the Fund.
Lord HARMAR - NICHOLLS: Although they eventually lose their identity, at the point of going in, one is a grant and the other is a rate support grant. I have had a little experience of this. I remember that, when I was head of a local authority, we used to have de-rating of industry. We used to have the rate support grant to cover the de-rating of industry because industry was a very important rate-producer in the

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area with which I was involved. But one did that direct with the Treasury. Now I gather—and the noble Lord, Lord Mackie of Benshie, seemed to bring this out—that, whereas the rate support grant used to come direct from the Treasury, it now comes through the Assembly, and that the amount that they have to pass on as the support grant will affect the amount of the block grant with which they are left. This is the point of conflict which I should like to be clear on. If for some special reason the Assembly want to keep a bigger part of the general grant for its purposes it could well be tougher on the local authorities. My noble friend may look bewildered. I am bewildered by the whole shooting-match, but, having now set out to try to understand it—and he must not get irritated with me—I should like to know whether the local authority, as well as having to satisfy the Treasury on the block grant, will have to satisfy a possibly avaricious Assembly. I should like to have an answer.
Lord KIRKHILL: May I direct the noble Lord's thoughts along these lines? At the present time, Central Government can alter the percentage of the rate support grant. If a policy decision so to do is taken, this will of course throw an additional burden upon the local authorities if they wish to maintain the present level of services. They will have the alternative of cutting back or raising rates. In exactly the same way, the Scottish Executive will have that area of choice. Before I resume my seat I may say that the nogotiations we have been talking about earlier are clearly—and this is mostly directed to the noble Lord, Lord Mackie—between the United Kingdom Government, which, in practical terms, means the Secretary of State for Scotland and the Treasury, and the Scottish Administration. If I in any way obfuscated that issue earlier, I hope that sets the record clear.
The Earl of SELKIRK: I am grateful for such information as we have had. May I try to summarise it? I am not greatly impressed with this argument about "at the present time", because we are, after all, examining a wholly new situation. If I understand the noble Lord, Lord Kirkhill, correctly, the block grant is the
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sole source of funds for the Scottish Consolidated Fund—is that right?—and it covers all the expenditure for which they will be responsible in the health services, in housing and in education. Is this correct? I am not clear whether or not it is correct. This money is received into the Consolidated Fund, and, as has been said, the identity is lost. What are not lost are the items of expenditure which have been submitted to justify it. They are not lost; they are still there. Does the noble Lord want to say something?
Lord KIRKHILL: Again to try to be helpful, I revert in one sense to an earlier point, but it also takes in the later point which the noble Earl is making. There are specific grants.
The Earl of SELKIRK: There are specific grants?
Lord KIRKHILL: Yes, but I did not say that there were not specific grants. I said that the rate support grant was not a specific grant, but that it was a general grant; and that is a statement of fact. But there are specific grants, and certain services—the police, as an example, and housing to a certain extent—enjoy support in that way. But the rate support grant is general, providing assistance for a whole range of services, which includes leisure, recreation, roads, transport and so on. It is for each local authority to decide the services upon which the rate support grant should be spent. This is a point I made earlier, and I can only re-emphasise it. The block fund will contain an element which takes account of the need to pay rate support grant to local authorities, and it will be for the devolved Administration to decide, after consultation, as I was saying earlier, with the Convention of Scottish Local Authorities, how the rate support grant should be distributed between the authorities. I honestly cannot add anything to that. That is the picture as I know it.
8.43 p.m.
Lord HARMAR-NICHOLLS: I wonder whether the noble Lord could explain this to me. Is it going to be a way —and I am not putting this politically; I just want to know—of giving a side-door authority to raise rates, which are, to me, the same as taxes? If it is that the rate

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support grant that they get coming through the Assembly is not as much as it would be if they had it as it goes now, that would mean that the local authorities would have to raise their rates in order to make up for what they were not getting now that it was coming through the Assembly. Is that a possibility? Because if that is so, then I reckon that ought to be made clear so that the people who are eventually to be asked to vote on the referendum will know what they are voting for. If it is that they are told that they are not voting for an increase in rates or an increase in taxes, whereas the way it is being administered means that they are, I think they are entitled to know, if that is what the situation is going to be.
Lord KIRKHILL: I responded to exactly the same point, which the noble Lord made earlier, as explicitly as could. I cannot add anything to that which I said just moments ago.
Lord MACKIE of BENSHIE: Perhaps I could say that the noble Lord, Lord Harmar-Nicholls, has been one of the most subjected Members of Parliament in history to the closeness of the electoral system; and if he was lucky enough to be a Scotsman instead of a poor East Anglian, and if he was in the Assembly and backed a Party which put up the rates, then he would not last in any shape or form as long as he lasted in the other place, and no one should know that better than he himself.
The Earl of SELKIRK: We have elicited a new and important fact, and that is specific grants, which I thought were always there. I must make the point that this was specifically denied—and, I may say, from both Front Benches —and it just was not true. There are specific grants.
Lord KIRKHILL: With respect, I did not deny that there were specific grants. I said that the rate support grant was a general grant. That is a statement of fact.
The Earl of SELKIRK: We have been told that there are specific grants. I wonder whether we could be told in due course what specific grants there are. I say that for this reason. We are told that, in theory, both the Assembly and the local authority have complete discretion.
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In practice, they have not. That seems to he the result. Would the noble Lord agree to this Amendment, because it makes it quite clear that this is the sole source of finance? I think it is desirable that it should be made clear. I see no reason why this should not be done, and I should have thought that it would help to make it clear that this is where all the money will come from. Can the noble Lord see any objection to this course being taken? I think it would make it much clearer to anyone reading this Bill.
Lord DRUMALBYN: Before the noble Lord answers, may I ask a question which may help to clarify this, at any rate for the future if not now? In Clause 44(2) provision is made for orders to be laid before the House of Commons. Presumably, such an order has to be meaningful to the House of Commons; and, that being so, presumably it will be broken down to some extent, and itemised. Presumably, also, the order may cover several sums to be paid—let us say, so much on such-and-such a date, which I believe is the practice already in some cases. Would this not help, if the global amount was itemised and there was then set out so many payments each month, each quarter or whatever it may be? This would cover all the payments, as I understand it, which are going to be made into the Scottish Consolidated Fund. Would this not help to make the matter clear for the future, even if it is difficult to make it clear for the present?
Lord KIRKHILL: That is a helpful elucidation of how I see the situation evolving. I am not in any disagreement with that indication.
The Earl of PERTH: I have listened to all of this, and I must confess that I remain extremely confused. I should like to suggest that perhaps it is possible for us to read the whole of this debate quietly at our leisure, and perhaps come back to it again on Clause 63, because they are related and they have been part of the same discussion all the way through. Then, if there arises, after looking through it again, something that we wart to raise at that time, we can do so. If, then, the sequel to that exercise is that the point made in the Amendment of my noble friend Lord Selkirk is a good one, we can move it again at Report stage.
The Earl of SELKIRK: I must say that the noble Lord has given no answer whatsoever as to why this should not be clarified in this Bill. I think it is quite clear. What is intended is not all that clear. This, I think I am right in saying, is intended to be the sole source of money for the Scottish Consolidated Fund. Am I correct in that? If I am, then I think it should be made clear that that is the case, and that there is not a separate thing called the rate support fund.
I should like the noble Lord to think about this. It is really rather important that we should eludicate this point, because it was never reached in the other place. I think the people concerned are entitled to know as fully as possible how this money which is going to be provided by the Westminster Parliament is intended to be used by the Government. The manner in which it is handled here is in many ways very loose, very untidy, and all that can be said is, "We have done this in the past". I am not interested in the past. This is a new system of government; it should be as fully explained as it can be, and I do not think the Government are trying very hard. Will the noble Lord think about this and try to elucidate this just a trifle further?
Lord KIRKHILL: My difficulty is that it appears to me that the noble Earl's Amendment is somewhat unnecessary, because the rate support grant will fall, as he has been saying, to be paid out of the Scottish Consolidated Fund. It follows that it will be one of the purposes to be financed from the block fund. Does that not seem reasonably straightforward?
The Earl of SELKIRK: No.
Baroness ELLIOT of HARWOOD: I think the noble Lord does not understand how obscure what he is saying really is to us. While none of us on this side, I dare say, may be exceedingly intelligent, yet all of us have had great experience in local government. We know what we are saying when we are thinking about getting money, spending money, putting in estimates and all sorts of things like that. Believe me, this is just one complete muddle. Will noble Lords opposite be prepared to take it back and to look at it?—they can tell those who draft it that we are all stupid on this side and do not
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understand. If you do not think we are stupid—and I hope you do not—then I may say that we are trying to do something to make it perfectly clear to the public, to Members of Parliament, and which does not alter it in any way. We are not altering anything; we are only saying to noble Lords opposite that you must put into the Bill words which are clear, understandable and cover everything. If you do that and think about it again—fine! We will leave it. Otherwise at Report stage I shall urge my noble friend Lord Selkirk to bring this question up again and vote on it.
Lord MACKIE of BENSHIE: Is it not a fact that the rate support grant will be paid out of the Consolidated Fund but that the non-devolved rate support grant, such as the police, will be paid direct to the local authorities? Is that correct?
Lord KIRKHILL: That is something that I think I have got to consider carefully before making an off-the-cuff reply. I must be frank and say that I will want to look at that. I shall certainly think about it and let the noble Lord have my observations.
Lord VAIZEY: I do not quite see what the difficulty is. It arises, surely, from the fact that the Bill establishes a new consolidated fund which is the Scottish Consolidated Fund. The money is voted by the other place and will be paid into the Scottish Consolidated Fund on the authority of the Secretary of State for Scotland. The Consolidated Fund in Scotland will, in turn, pay rate support grant to the local authorities in Scotland which hitherto has been paid out of the United Kingdom Consolidated Fund. I cannot see the difficulty, except that the same words are used in two separate bits of the Bill to mean different things. I should have thought that the substantive issues comes up on a subsequent Amendment.
I do not find this obscure. It is clear that the intention of the Bill is that virtually the only source of revenue for the Scottish Executive to spend will be through this grant from Parliament. It may be that odd things will be passed in the United Kingdom Parliament by subsequent legislation which gives them, say, the revenue from dog licences; but

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it is quite clear this Bill's intention is that the whole of the money spent by the Scottish Executive on the authority of the Assembly is to be in this block vote by Westminster. The central issue is on a subsequent Amendment: whether this is a correct principle or not. It is not whether they have used the same language in Clauses 44 and 63, with great respect to the other side. I am sympathetic towards them; for I am convinced that muddles will exist in a Bill of this complexity but I did not think that this was an overpoweringly difficult muddle.
The Earl of PERTH: It is all very well for the noble Lord, Lord Vaizey, to say that this is clear. I am not on the other side; I am a Cross-Bencher. To me, it is not clear. I cannot understand why, if what he says is correct, we cannot include the words used by the noble Earl, Lord Selkirk. Then we get a question raised by Lord Mackie and Lord Kirkhill cannot answer it, and the confusion then becomes greater to me. I think that we ought to be allowed to look at this again, to relate it to Clause 63, and when considering that clause, if the need arises, to debate it further and, as the noble Baroness, Lady Elliot, has said, if we are not satisfied at that time we can always move an Amendment at Report stage. To me, it is not as easy as Lord Vaizey says it is; but I am only a Cross-Bencher.
Lord MOTTISTONE: I wonder whether the noble Lord, Lord Kirkhill, will let us all into the secret. He said that he will tell Lord Mackie the answer to his question. It might be as well if we all knew the answer to that question. Perhaps somehow he will convey it to us all and not just to Lord Mackie.
Lord STRATHCONA and MOUNT ROYAL: I got into a certain amount of trouble on this problem before dinner. When I get into the macro-economics of the various funds I sometimes try to bring it down to the domestic level. I do not know whether this is a good analogy or not or whether it will create more confusion. Is the Consolidated Fund a kind of housekeeping account? And is the husband—Westminster—going to agree to pay a certain monthly allowance into the housekeeping fund? But, in addition, the lodger is also paying some rent and out of
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that the wife is paying various outgoings. But every now and again she comes along and says, "I need something special—a washing machine". The husband says, "Here is £150 for the washing machine." She may be cunning and get it for £125, but she does not have to account for the difference. The fact is that the special thing is negotiated in that way.
I think that the problem we are in is a purely factual one: of what is put into the fund, how it is negotiated, what is going to go in and, then, how it is disbursed again. I think of it in this way in order to clarify for me the way it is topped up and paid out. I hope that my analogy may be a fair one.
Lord KIRKHILL: I do not know whether the analogy helps noble Lords. I do not know if it helps me. Perhaps I am now beginning to become more confused than usual. I should point out that the noble Lord, Lord Campbell of Croy, very fairly described the practical workings of the situation as it is at present. Certainly, I cannot see that the Bill will change the practical workings of this sort of situation except that some of the principals will alter—and I mean by "principals" not principles but persons.
Lord CAMPBELL of CROY: As I have been mentioned, I must say that all I did was at one point to try tc assist by reminding your Lordships of how the rateable grant total amount was negotiated. I did not get on to the question of specific grants. I thought that my noble friend said that something was mid about specific grants from both Front Benches, but I realise that he said "Benchers". I know that the police and other services are paid by specific grants. It was not for me to deal with that, but for the Government. I was reminding your Lordships of how the negotiations for the total sum take place between the Government and the representatives of the local authorities and that because they then have to make pretty accurate estimates of what the expenditure is going to be under different headings, they carrot later depart very far from the expenditure that they foresaw under those heads. I cannot try to explain this Bill. I am still trying to learn from what the Government are saying how these various clauses interact with one another. I think that Lord

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Vaizey has put it in a very simple form; but, for that very reason, I cannot see why my noble friend's Amendment cannot be accepted.
Lord KIRKHILL: If, at some personal risk, I can return to the question of specific grants, I am able to affirm that these may be paid for devolved services or for non-devolved services; and to let each one know (as I was requested to do) that the former will be paid by the Scottish Administration and the latter will continue to be paid by the Government.
Lord HARMAR-NICHOLLS: I thought I had got it reasonably straight. Is the position this? I will use an analogy. At this minute, the arts do not get their grant direct from the Government in the United Kingdom. What we have done (and, I think, sensibly) is to set up an Arts Council and we have said that all the money that the Exchequer is going to give for any kind of art—painting, theatre, museums—will go to the Arts Council. The Arts Council will decide, from the global sum of, say, £40 million, what goes to the various branches. That, I gather, is how the rate support grant and the block grant will be dealt with.
The point that I am making is that if, until now, instead of it having to go through the equivalent of the Arts Council, the various sections have it direct, it is going to mean that there is a different procedure so far as they are concerned. If the sieve that it goes through—in this case the Assembly—is tough (for reasons outside Party reasons) they will be forced to put up their own rates. Is my analogy of the Arts Council grant the right one, or is the housekeeping analogy of my noble friend better? I do not know.
Lord KIRKHILL: I would not like to opine about either analogy, but I would re-emphasise the point I made earlier to the noble Lord, Lord Harmar-Nicholls. If he will think of the present position, we could, for example, be in a period of crisis. Then the Government of the day might seek to adjust the percentage rate support grant. This, in turn, as I tried to explain earlier, would mean that the local authorities concerned
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got less. If they want to retain services as they are then the rates would be higher than they otherwise would be. On the other hand, they might cut services. I do not think I can say anything more about it.
The Earl of SELKIRK: May I make two points about this? It is quite clear from Section 63 that all rate support grant is made from the Scottish Consolidated Fund, and that includes the police. That must include a lot of reserved subjects. I did try to elucidate that and I have failed. May I just say now to the noble Lord, Lord Vaizey, that if Section 63 had followed 44 I would agree, but there are 20 sections in between and I wanted to be quite clear whether they were connected or disconnected. I do not think that is altogether unreasonable. I will not press your Lordships any more on this. May I hope that the noble Lord will look at this again and try to help stupid people who find it so hard to understand what this Bill means?
Lord KIRKHILL: Before the noble Earl resumes his seat, I must say just this. At no time have I ever suggested, surely, that anyone was in any way stupid—
The Earl of SELKIRK: No.
Lord KIRKHILL: At no point did I ever make such a base assertion. I always look at what your Lordships say, if only as a means of self-protection and self-preservation. I am not in a position at this stage to accept the noble Earl's Amendment.
The Earl of SELKIRK: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
9.2 p.m.
Lord STRATHCONA and MOUNT ROYAL Lord STRATHCONA and MOUNT ROYAL moved Amendment No. 157:
Page 22, line 33, at end insert ("and a calculation setting out a comparison of the proposed resources per capita for the year in question which would be available as a result of the approval of the draft order for expenditure by the Scottish Executive for purposes falling within devolved matters, with the resources per capita provided for that year for such purposes in England and Wales.").
The noble Lord said: After what we have just been through, it is with some trepidation that I rise to move an Amendment which contains the word "calculation"! However, what we are doing here is something which is not only fairly simply but fairly self-evident. Subsection (2) speaks of a statement of the considerations leading to the determinations to be made by the order; and all we are really doing here is spelling out what might be considered to be one of the considerations.
This, again, is based on the July 1977 White Paper, which suggested that this might be a reasonable approach to arriving at these kinds of figures. Also, I think that to some extent this Amendment addresses itself to a problem raised earlier by my noble friend Lady Ward, although it does not go quite so far as to suggest that the comparative figures should be spelled out on a region by region basis.
I think that what we have to recognise here is that Scotland is currently getting something like £120 per capita for every £100 spent in the United Kingdom as a whole, and perhaps I might make the Party point that I believe it has gone as high as 30 per cent. extra in the halcyon days of Tory Governments! However, I understand that at the present time it is something of the order of 20 per cent. higher. Against this, the average rate of tax paid by taxpayers in Scotland is something like £50 per head lower than in England. I have also seen a calculation which suggests that there is an overall budget deficit in Scotland of the order of £400 million. I do not know whether any of those figures are anywhere near correct, but I believe them to be in the right general area.
We talked earlier about allocating expenditure according to need. I could say "Amen" to that. It is clearly a sensible way to go about it. Here you are a country with a sparse population, with difficult communications, with a bad reputation, at any rate, for their weather, which I sometimes think is perhaps not wholly undeserved, and with considerable areas of less-than-satisfactory land. In other words, this is a country with certain natural disadvantages as compared with England. I think all of us feel that it is totally reasonable for this to be
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recognised and for extra payments to be made in respect of it.
The fact is that these payments are currently being made and, on the whole, people in the United Kingdom accept that we have to make special arrangements to help the Scottish electricity supply, the Scottish roads, the difficulties of Scottish education, and so on. We are always fearful of the possibilities of the English backlash and it seems sensible, at least—and this is alluded to in the White Paper—to try to make some attempt to get at some of the facts and spell them out. It may be said that this is not the sort of thing one should put into an Act of Parliament. Nevertheless, I think it gives us the excuse to ask the Government whether they think this is a proper way to approach arriving at what is clearly going to be, in any case, a difficult negotiation. I beg to move Amendment No. 157.
9.7 p.m.
Lord MIDDLETON: It is so essential to try to maintain the unity of the United Kingdom that we should, I am sure, look at any means, however unsatisfactory, that can reduce the divisive effect of Clause 44, to which I referred earlier this evening. The White Paper on expenditure suggests—and it has been suggested also by Ministers in another place—that after devolution the Government intend to explore with the devolved Administration the scope for an independent body and for a formula under which devolved expenditure will be settled.
It is not just the devolved Administration that should be consulted. The size of the block grant affects every region in England. At present the Scots are receiving per head of population 20 or 25 per cent—whatever it may be—more in identifiable public expenditure than the English. I agree with my noble friend Lord Strathcona that this disproportionate allocation is accepted in England at present.
As the noble and learned Lord, Lord McCluskey, reminded us earlier this evening, the system of public expenditure based upon need is well established and the poorer English regions, having similar problems of unemployment, dereliction, decaying industries and so on, benefit in the same way as do the Scots. I do not think that these regions are at present

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resentful of the Scots. They accept the differential system administered from the centre by what appears to be a reasonably fair process, and where there is no undue political pressure from north of the Border.
After devolution, the share-out as between England and Scotland will be high-lighted every time the block grants come before Parliament. There will inevitably be great political pressure from Scotland and this may well build up strong resistance in England. It is essential that Parliament should be fully informed as to the relative level of expenditure per head in England and in Scotland, and, if it is seen in Parliament that the Scots are to remain in relatively the same advantageous position, then I believe that this will be, as now, perfectly acceptable in England. If, however, there were to be Scottish demands for an increased amount, relatively, of expenditure per head, then the figures provided would show whether this was fair or whether it was greedy.
One is tempted to go further than this Amendment—this possibility has been referred to earlier this evening—by legislating that figures should be provided for Parliament showing the breakdown of expenditure per head on the devolved services, as between all the English regions. I suppose that you would define them by reference to the boundaries of the present Economic Planning Councils. It would then probably be found that the more disadvantaged regions of England, such as those of the North and the North-West, were being treated as well as, if not better than, Scotland, and that might go a long way towards curbing any feeling that they, having many of the problems of Scotland, and very often in a more acute form, were being treated relatively worse.
This might mitigate the divisive effect of the periodical dispute as between the North of England and Scotland, but it would also raise problems as between the English regions and for that reason I prefer this Amendment and I support it. A vague promise, to consult a Scottish Assembly about how to allocate public expenditure throughout the United Kingdom, takes no account of the legitimate concern of the English regions, and does nothing to mitigate the possible divisive effect of Clause 44. I very much
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hope that the Government will accept this Amendment, in view of their desire to provide a Bill that will strengthen and not weaken the United Kingdom.
Lord TANLAW: I wonder whether the noble Lord, Lord Strathcona, could help me on a point. Can he explain whether, if his Amendment is successful, the Scots will get more than the Goschen formula, or approximately 11/18ths of the national Consolidated Fund, or less? I am afraid that I am not very clear.
Lord STRATHCONA and MOUNT ROYAL: I am in some difficulties, because I am not familiar with the Goschen formula, which I do not think we use any more.
9.11 p.m.
Lord VAIZEY: I must confess that I think this Amendment comes fairly near to the heart of the Bill. It is rather interesting that we had bevies of law Lords (if "bevies" is the right word to use about a collectivity of law Lords) speaking about the rather abstruse problems of which court people should appeal to. Presumably it will be quite a large item in Scotland. But Clause 44 and this Amendment are likely to be the central point of debate every year about the position of Scotland in expenditure terms, which is really what the Bill is all about.
The noble Lord, Lord Strathcona, was perfectly correct. Since Dr. McCrone first did these calculations about 20 years ago it has been well known that the expenditure per capita on the services in Scotland is higher than it is in England. This is partly because, on average, the Scots are poorer than the English, but it is also because the level of public services, despite what the noble Earl on the Cross-Benches would aver, is generally rather higher in Scotland than in the rest of the United Kingdom, as various indices show.
The trouble with this Amendment is that it refers only to one possible index of the way in which the clause will operate, and I should have thought that the real defect of the clause—to which I shall want to speak when we debate, Whether the clause shall stand part of the Bill?—is the absence of any formula, such as the Goshen formula, from the Bill. As I

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understand it, this is to be left to a periodic haggle between the Scottish Executive and the United Kingdom Government, which will be a continuing source of irritation.
If I may just spell out why I am slightly dubious about what the noble Lord, Lord Strathcona, has suggested—though I think it is an important point and one which bears close consideration—if you think back in more general terms about the Bill, what it is really doing is what we all like to do; that is, to have our cake and eat it, too. What the people of Scotland want is parity of services with England, and by "parity" they mean slightly better; that is to say, if you fall down and break your leg in Inverness or in Southend, there will be a free hospital for you to go to. The basic principle is that your children should be at schools which are roughly equal. That is the reason why the Government have not given power to the Scottish Assembly to levy taxes and why, broadly speaking, they have not given to the Scottish Assembly power to do very much.
The Government have not allowed any real power over the economy to be given to the Assembly. However, the Government have allowed power to the Scottish Assembly to vary expenditure between housing, health and education. Those are the three principal subjects which are devolved. It follows therefore that if the Scottish Assembly says, "We will build an extra new hospital in Glasgow", they will not be spending so much on education as they would have spent if the United Kingdom Government had built their hospital. That is the necessary corollary. Therefore the Amendment moved by the noble Lord, Lord Strathcona, will not show the net effect on each service. It will show only the total volume of expenditure which is directed towards Scotland divided by the population of Scotland.
This is not a very good index of the level of services provided. Therefore it will not give the noble Lord, Lord Strathcona and Mount Royal, the information that he wants. For example, if the Scots had twice as many children per head as the English, the expenditure on education in Scotland would be much larger. Therefore the whole basis of comparison would not have much statistical validity.
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I shall listen with great interest to what the noble Lord has to say in reply to the points which have been made on his Amendment. If I had more courage and more familiarity with the practices of your Lordships' House, I should have moved a series of Amendments designed to draw attention to the absence of any formula on taxation. These clauses were not very much debated in the other place, and the general level of debate so far has been pretty low; yet this is the area where there will undoubtedly be an annual fight of a very substantial kind.
9.16 p.m.
Lord MACKIE of BENSHIE: I am afraid that I cannot allow a number of points which have been made by the noble Lord, Lord Vaizey, go by without comment. This is a very useful probing Amendment. Of course it is not necessary for any Government to publish the facts and say how much more is being paid to one section than to another, and the reasons why. Nobody has mentioned the reasons why. I am surprised that the noble Lord, Lord Vaizey, who I understand is an economist of enormous distinction, did not go a little further into the reasons for the higher expenditure in Scotland.
The fact is that round about 1900 the income per head in Scotland was higher than in England and, far from paying £50 a year less in income tax, the Scots were earning higher incomes. At that time, and even before that time, there was a large migration of able Englishmen into Scotland to work in those industries which were founded on coal and steel but which have since largely died out. May I also mention that during two world wars the heavy industries of Central Scotland received an artificial fillip which deprived them of the chance to develop the new industries which brought enormous prosperity to the Midlands of England.
We have the situation in Scotland that services are much more expensive to maintain. Nobody who wants an Assembly has ever denied that there is more coming into the kitty in Scotland than is being received in the form of taxes. The reasons for this state of affairs are perfectly plain. We cannot say that we have had union with England and unitary power for 270 years and that

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now we have a situation in Scotland where income per head is less while expenditure on public services is much more and then be told, "If you want a devolved Parliament you must pay for exactly what you have. You will receive exactly what you pay for and nothing more". It would be reasonable to say this after 30 years of devolution. Then the Scots could take the blame for their own mistakes. In the meantime, while I agree entirely with the noble Lord, Lord Strathcona and Mount Royal, that the per capita entitlement or grants to various regions should be set out for the information of all concerned, I believe that the regions in Scotland which have the highest need should also have a per capita grant.
The Earl of PERTH: I find it difficult to understand why just this one Amendment is made to the clause and why it is said to be a special factor. There are any number of other factors involved. All of us know the degree of unemployment in Scotland which has to be set against the degree of unemployment, if not in England then in the Regions. We have seen the figures. My worry is that statistics are enormously misleading. This may be one factor, but when I read the Bill I find that Clause 44(2) says:
"a statement of the considerations leading to the determinations to be made by the order".
I should have thought that the whole was very much better than the part. All I see in this Amendment is the choosing of just one small part. Both the noble Lord, Lord Vaizey, and the noble Lord, Lord Mackie of Benshie, have made the point that there are other considerations. Surely those are covered by the Bill as it stands. If we focus on just this one calculation, it may do more harm than good.
Lord DRUMALBYN: May I make a short observation? I merely want to ask a question. So far as the acceptability of the statement being made before Parliament is concerned, a very great deal would depend upon the detail of that statement. I would agree with my noble friend Lord Middleton—and I think the noble Lord, Lord Vaizey, also made the point—that if one starkly compared the figures per capita in Scotland with the
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figures per capita in England one would be throwing into relief something that some English people might wish to be thrown into relief in order to reduce the wrath of Scotland. If, on the other hand, one added in the various regions of England which were much more comparable to Scotland one might be accused of being selective.
Therefore, it seems to me that if one did this at all one would be bound to show the complete picture for the United Kingdom and indeed it might be a very good opportunity to do so; it might become one of the major debates of the year on this subject in another place. But we should have to know in advance the kind of detail that the Government at present have in mind in regard to the statement of the considerations leading to the determinations to be made by the order. If the noble Lord would give us some inkling about that it would go a long way towards satisfying us at the present time.
Baroness WARD of NORTH TYNESIDE: I should like to support this Amendment. I do not know whether it is absolutely the best Amendment that we could get, but I am grateful to the two Members of my own Front Bench who have decided to table it. I think it is a move in the right direction and I never like to lose an opportunity of supporting something which at any rate is on the right road. Quite a number of noble Lords may be in favour of the Amendment but think that perhaps it is not the best wording; however that does not prevent us from accepting the Amendment and if, before the Report stage, we can improve the wording, so much the better. It goes a little way towards helping something that I mind very much about; namely, that in the region which I represented in the other place, and other regions where there is high unemployment, we shall have a chance of getting support.
I wish to make only one observation. When I first was elected to another place in 1931, 84 per cent. of the employable population in my constituency were unemployed, and I spent a great many years trying to bring special industry to my part of the country. Very few areas had such high unemployment. So I am grateful for this Amendment and I hope that we shall divide on it. I do not mind

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whether we win or lose but a Division is very important so that people who read Hansard can see that at any rate some members of my own Party—of my own Front Bench—realise the problems of high unemployment that my area and others have to deal with.
9.24 p.m.
Lord KIRKHILL: A similar Amendment to this was debated in the other place and my right honourable friend the Secretary of State for Scotland said, among other things,
"It would be misleading … to single out this piece of information as being of such special significance that it must specifically be written into the Bill when none of the other matters that the House will in due course expect to have before it will be particularised in the Bill as it stands. However, all the information is already comprehended in the wording of Clause 44(2)".
And, of course, at that point the noble Lord, Lord Drumalbyn, asked me whether I could give him greater detail as to the kind of information which would be included in the draft.
I cannot as of now give him a detailed reply, but I will undertake to think about the point he has made because I think it is an important point; I recognise that. I will reflect upon it and, if I can help him in this, then I shall arrange for that to be done, either by my speaking of this on a future occasion or by some other method. It may be that I am not able at this stage to give him the details, but I will examine the point because I think it is a useful point he has made and one to which I should certainly respond.
Lord DRUMALBYN: May I intervene before the noble Lord leaves that. It would not, of course, be unknown to have a schedule or an appendix indicating the kind of considerations that would be taken into account without purporting to be in any way comprehensive.
Lord KIRKHILL: I think my difficulty, to be absolutely frank about it, is that it is difficult exactly to bring this into a detailed format, because this matter is going to stand before the other place and be examined there in detail. I should be surprised if they were to pass an order there, which they must do, unless they had closely examined the details underpinning that order. That is really my difficulty. I do not want to go too far in relation to a
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matter which will stand very clearly before the other place. But I am going to turn over in my mind what the noble Lord has said about that.
For the reasons that I have been quoting, which my Secretary of State enunciated in the other place relative to a debate of a very similar character, the Government do not consider that it would be appropriate to single out per head comparisons as an essential element in the information the House of Commons will require in order to judge the reasonableness of a block fund order. The Bill already provides, as we have been saying, for a statement of considerations, and as the block fund order requires an Affirmative Resolution honourable Members in the other place will be able to ensure that they are provided, as I have just been saying, with such information as they consider relevant to the decision the House will have to reach.
As the noble Lord, Lord Strathcona, was saying, indeed as the noble Lord, Lord Vaizey, mentioned, and indeed as the noble Lord, Lord Middleton, averred, it is certainly the case that for many years public expenditure per head in Scotland—and, I might add, also in Wales, and even more so in Northern Ireland—has been much higher than in England as a whole, and this situation may be expected to continue for a number of years at least. This is because it is the British practice to allocate expenditure where it is most needed.
The noble Lord, Lord Mackie of Benshie, touched on some historical factors, and I agree with what he said about that matter. In addition, one can talk about larger numbers relatively of children and old people, sparsity of population over wide areas, as the noble Lord, Lord Strathcona, mentioned, severe urban problems in the older industrial areas and so on. I think these are self-evident. Scotland's higher public spending per head arises from the operation of such demographic, historical and geographical causes. It is not a matter of principle, and to lay exclusive stress on per head comparisons is, in the Government's view, misleading. It is also potentially divisive since it focuses attention on a manner of expressing expenditure which fails to reveal the differing relative needs to which the figures relate. Noble Lords have mentioned this themselves.

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In any case, comparisons of expenditure per head in Scotland and in England as a whole are largely meaningless because of differences within the two countries, and particularly within England. Detailed figures for individual regions are not available, but we might perhaps look forward in the future, as Lord Drumalbyn was suggesting, to debate in the other place if it becomes a standard annual practice to publish comparisons. But differences between them might well turn out to be as great as, or greater than, those between the two countries taken as a whole, The Government have adopted an expenditure-based system of finance for the devolved services. Such a system requires the continued pooling of all the resources of the United Kingdom and their allocation to different parts in accordance with their relative needs for public expenditure.
The Government believe that the right approach in these matters is that set out in the White Paper, which is gradually to improve methods of establishing comparative standards and needs so that public expenditure allocations can be determined in a more fully informed way. The Government hope that, as methods are improved, the character of the information that it will be practicable to make available to Parliament, and which Parliament will expect to be provided, will change also. If an independent advisory body is established—that, as noble Lords will remember, is discussed in the White Paper—its reports may be particularly relevant and helpful to the other place in the judgments it will have to make. It is for those reasons that the Government would have difficulty in accepting the Amendment to which the noble Lord, Lord Strathcona and Mount Royal, has spoken.
9.32 p.m.
Earl FERRERS: This is an important part of the Bill, as it determines how much money is being given by the United Kingdom Parliament to the Scottish Assembly. The noble Lord, Lord Kirkhill, said he did not think that this Amendment would be necessary because its contents appeared in Clause 44(2). However, he then said that he was not certain exactly what Clause 42(2) would provide in the way of information.
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The noble Earl, Lord Perth, said that too many statistics would be confusing. I agree. Presumably, what will be put in the order is the fact that so much money was allocated for the purposes of education, or for the purposes of health, even though the Scottish Assembly might not use it that way once it had the money. The lump sums which will be put on the order will be relatively meaningless unless they are reflected against an item. If the draft order is to say, for instance, that £42 million have been allocated for this and £36 million for that, it will be relatively meaningless unless it is either related to population, or per head, or per local authority. It must be related to something. I should have thought that, as a simple statistic, this could have been understood by the people if it was related per capita.
We all know that people in Scotland receive more per capita, for all the reasons explained. No one would object to that. I should have thought that there would be some people who would like to know how much more per capita Scotland is getting than England.
The noble Lord, Lord Mackie of Benshie, said that Scotland had had a difficult time because two World Wars had knocked about its heavy industry, and that the Scots had not been able to refurbish their industry as they have in central England. That is true. However, industry in the North of England was also hammered. Scotland will, on the noble Lord, Lord Mackie's basis, be receiving a larger proportion per capita because it was hammered about during the war, whereas the North of England, which will be receiving a less amount per capita, was equally hammered about during the war. The noble and learned Lord, Lord McCluskey, shakes his head. If I am wrong about that, I should be grateful to know. It seems to me that we must have some kind of comparison. If it is not done on a per capita basis then there should be something else.
Lord KIRKHILL: The Government, for reasons that I have just explained, do not think that the per capita explanation is the best that could be encompassed within whatever order is eventually discussed in the other place. The Government are convinced that the other place will want considerable detail and, as we

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have been talking about the advisory body, we are hopeful that we shall be able to draw comparisons over a wider range. That was the point that I was trying to emphasise. The Government are not anxious to isolate on its own, as it were, the per capita comparison.
Earl FERRERS: Will the noble Lord give us some indication as to what types of comparison the Government have in mind? He says that they will not use the per capita comparison and that there will be a wider basis of comparison. I do not want to push the noble Lord or make it difficult for him, but, on the other hand, this matter is important. After all, this is new legislation that we are discussing. It is all very fine for the noble Lord to say, "Well, the House of Commons will want a certain amount of information". We are suggesting that it should be a little more specific than that and that we should know that certain information will certainly be available, even if other information which is not written into the Bill may be available later on.
Lord MACKIE of BENSHIE: Before the noble Lord, Lord Kirkhill, replies may I state our position for the record. I entirely agree with the noble Earl, Lord Ferrers, that any other disadvantaged area such as Tyneside, which has exactly the same record of having to expand its old industries during time of war, should be on a similar basis—not per capita but per need of the area. We should like to make that perfectly clear.
Baroness WARD of NORTH TYNESIDE: I should like to raise one matter because it must be stated. Part of the problem of the mining industry on Tyneside is that that area, with the exception of one or two big collieries, has nearly used up all of its coal because it is a very old coal field. The Northumberland and Durham coal fields were almost the oldest coal fields to be developed. I have followed the argument with very great interest, but it should be on record that we are faced with a declining mining area because we have worked most of our coal. I think that that matter should also be taken into consideration.
Lord VAIZEY: What my noble friend Lord Kirkhill has said is so reasonable, and what he has quoted the Secretary of
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State as saying in the other place sounds so reasonable, that one can do little but agree with him, except in one respect. I gathered that my noble friend quoted the Secretary of State and I think that the Secretary of State made a rather excessive claim. It is perfectly true, as I think all noble Lords who have spoken so far have said, that comparisons on a per capita basis are misleading. However, they are comparisons and in my view it would be unfair to say that they were meaningless. They should, of course, be taken into account with other data and we are perfectly well aware of that.
It is perfectly true that if we take the average of Scottish expenditure and compare it with the average of English expenditure—the Minister quoted the Secretary of State in this regard—it is perhaps not so meaningful. The differences within England, say between the North-West and South-West, may be even greater than the differences between the average of England and the average of Scotland. We are not proposing in this Bill to give devolved governments to South-West or North-West England; we are proposing to give devolved government to Scotland.
In my view the noble Earl, Lord Ferrers, put his finger centrally on the point. We know that the money which is now given to the Secretary of State for Scotland to spend is determined, broadly speaking, by a formula which exists in the Treasury. That formula will be the same as applies to similar services in England plus a bit more because Scottish political weight is higher in the House of Commons than elsewhere, and also its needs are greater. It depends which side of the fence one is which kind of argument one finds more attractive, but that undoubtedly is the way it is done.
Assuming that the Bill becomes an Act and is put into operation and approved by the referendum, then as we depart from the bench mark, assuming the Assembly does its job, the differentiation of services offered as between England, on the one hand, and Scotland, on the other, will grow—that is to say, there will be marked differences. If there are not going to be marked differences, what is the point of the Bill? It will just be a question of people sitting in Edinburgh saying, "Let's keep everything exactly the same as it is in England", which would be a pointless

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exercise. As we get further away from the bench mark of parity of services, which is broadly speaking the present bench mark, we have no formula for the allocation of money to the Secretary of State for the Secretary of State to allocate to the Scottish Assembly. That is the point that I am trying to make.
One could perfectly well say that it will be spelled out under the second part of the clause, but it does not say how it will be spelled out. I should have thought—there was some debate on this in another place, but it was not a very effective debate—that it was slightly irresponsible of Parliament to pass legislation of this importance for one of the major nations of the United Kingdom without saying on what basis the money which this subsidiary Parliament will get will be determined. That is the point which the noble Earl, Lord Ferrers, was making. I do not find it wholly convincing to say that this might be discussed by some hypothetical advisory body which might be set up if all goes well.
Lord KIRKHILL: Perhaps I might respond to the noble Earl, Lord Ferrers, and indeed to my noble friend Lord Vaizey, because I completely failed to satisfy them both. I cannot go much beyond my earlier comments. What the order will contain will be determined by the Government of the day as a result of whatever considerations Members in the other place decide upon, pursued by the questions which undoubtedly will be asked there and will obviously be raised in your Lordships' House, as noble Lords will be fully entitled to do. I cannot be more specific about the actual detail at this stage, and I shall not prevaricate and say that I can.
Lord MORRIS: As I understand it, this Amendment attempts to entrench an admirable practice which was started in the Government White Paper entitled, Devolution—Financing the Devolved Services, where there is a very excellent table which expresses the identifiable public expenditure for 1975–76 on a per capita basis across England, Scotland, Wales and Northern Ireland, and the United Kingdom, expressed as a percentage of the whole of the United Kingdom over 12 separate heads. It is absolutely
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marvellous. I cannot understand why the noble Lord, Lord Kirkhill, is so churlish about not continuing this admirable practice in the future.
Lord KIRKHILL: I do apologise to the noble Lord; but I failed to catch the latter part of his remark. Would he care to repeat it?
Lord MORRIS: I was wondering why the noble Lord is so reluctant to continue with this splendid practice, as is set out in this White Paper of July 1977.
Lord KIRKHILL: There is, I think, a question of the determination which the other place may make about a matter of this kind, which at this stage at least precludes me from going further.
Earl FERRERS: I certainly do not wish to continue this debate for much longer. However, I should like to make one point which is, I think, of cardinal importance, The noble Lord, Lord Kirkhill, has said that he cannot go any further or give us any more information. We appreciate his difficulty, but he will also appreciate our concern that here we are dealing with a Bill and when we ask the Government what is intended and anticipated—and this has happened several times in the past —we are always told, "We do not know; we shall have to see what happens". We had this only the other night, when I believe we discussed standing orders, when we were told, "Leave it; it will be all right." I hope that the Government spokesmen will be able to address their minds more specifically to some of these points. I really think that when something of huge importance like this comes through Parliament—and financial powers have not been greatly discussed in another place—we should be able to have some answers as to what the Government intend.
Lord KIRKHILL: Before the noble Earl, Lord Ferrers, resumes his seat, perhaps I might point out that in response to matters put to me earlier by the noble Lord, Lord Drumalbyn, I said that I would turn over in my mind that which he had put to me, which was on the same issue as this. I do not know whether I can come back to the noble Lord with specifics, but I have said that I shall look at the point. It may be that I am

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inhibited from going further, but I have said that I will look at it.
9.44 p.m.
Lord STRATHCONA and MOUNT ROYAL: The noble Lord, Lord Kirkhill, has tried very hard to help us. I had the impression that he was not being quite so helpful at the end as he was at the beginning, which I thought was rather a sinister sign. This, of course, is a flushing out Amendment. I am very grateful to those noble Lords who have spoken and who have supported us on it. I am afraid that I am going to disappoint my noble friend Lady Ward by not pressing this Amendment, although I am bound to say that her proposed technique of pressing it and saying to the noble Lord, Lord Kirkhill, "You think up a better one" is rather an attractive idea.
The noble Lord, Lord Vaizey, immediately understood the underlying purpose behind what I freely admit is a slightly inadequate Amendment, and, as the noble Earl, Lord Perth, said, why single out this single statistic? I think that the noble Lord, Lord Drumalbyn, had it absolutely right; what we are talking about is a matter of presentation and acceptability when it comes to getting the order through the other place. I suppose in a sense that the Government could say, "You leave our public relations to us because we know very well how to handle them". But we are trying to suggest to them that many of us would feel happier if the Government convinced us that they had done their homework.
Knowing that the noble Lord, Lord Kirkhill, has nothing else whatever to address his mind to in the next couple of weeks except this matter, I am hopeful that he may conceivably be able to suggest some kind of a Schedule. I think it was the noble Lord, Lord Drumalbyn, who
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said that it is perfectly common practice to list the kind of relevant considerations which might be put into a Schedule. I think I understand, even if I do not condone, the evasiveness of the noble Lord who is anxious not, as they say in the West Country, to convict himself. He is not going to commit himself to doing something that he might find embarrassing.
Anybody who has ever participated in defence debates gets a little nervous about the per capita argument, which we have pursued exhaustively in this House. It is used as a justification of our splendid efforts in defence. The percentage GNP argument is the argument that is used; the per capita argument is the rather devastating one when you try to justify this country's defence effort.
I merely say this to indicate, as the noble Lord, Lord Vaizey, was saying, that one statistic taken on its own can be dangerous and positively misleading. However, the Government have laid themselves open. They have said in the Bill that a statement of considerations will be produced, and all we really have been saying to them is, "Is it not about time that you satisfied us by going a little further and saying what sort of considerations you had in mind when you wrote that down? If you did not have any considerations in mind, then you should not have said it in the first place."
Having said that, I think I should let us all off the hook for this evening and see what we can do at a later stage. I invite the noble Lord to produce a Government Amendment, which I can assure him we shall accept with alacrity. In the meantime, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
9.48 p.m.
Lord HARMAR-NICHOLLS Lord HARMAR-NICHOLLS moved Amendment No. 362:
Page 22, line 33, at end insert—
("(3) At the request of the Scottish Executive in pursuance of a resolution by the Assembly, the Chancellor of the Exchequer shall in so far as is consistent with Community obligations and other criteria laid down by the Secretary of State cause the rate of any tax or taxes broadly based and general throughout Scotland to be raised by up to but not more than 25 per cent. of the rate obtaining elsewhere in the United Kingdom, provided that the total amount so raised be not more than 10 per cent. of the amount transferred under subsection (1) of this section; and the Secretary of State shall thereafter by order cause a sum equivalent to the net balance raised to be transferred to the Scottish Consolidated Fund in addition to those sums transferred under subsection (1) of the section.")
The noble Lord said: This Amendment takes us into a completely new line of country compared with the discussions we have had so far today. So far all the Amendments have been on matters of detail, and intricate matters of detail too. I do not think that the Government Front Bench have really understood what they have been saying, and I do not think that our Front Bench and certainly the Back-Benchers have altogether understood what has been said to them. But there it is. The type of Amendment that they have had to deal with has caused that sort of problem. I know that the noble Lord, Lord Mackie of Benshie, understood both sides with absolute ease, and that the Bill to him is superb, and we need not bother much about it.
My line of country is facing up to something which is not in the Bill yet; but if we are going to have the Bill—and I do not want the Bill; my position is perfectly clear—there ought to be something completely new. We ought to have that meeting of all sides to see whether we can start from something more workable and more acceptable than this Bill can be. If we are to have this Bill, I really come down on the side of what Lord Vaizey has been saying from the first. Indeed, I think we both put this point of view forward on Second Reading. What he has said, and what I think is the fact, is that for this Bill to be of any use at all to minimise the conflicts that will arise—it will certainly not eliminate them—we have to give financial powers to the Assembly.
The Amendment is in anticipation of what, if the Bill is passed, I believe is inevitable. It is designed to limit what they can do with the powers which they will eventually get—that is, unless the Bill can be killed. My Amendment says, in effect, that when the time comes for them to have these powers they shall be restricted to being able to raise extra taxes to the tune of no more than 10 per cent. of the block grant. They would be limited on extra taxes to no more than £190 million—10 per cent. of the total sum—and it goes on to say that no one item—they might use several items to get that 10 per cent., including perhaps additional petrol or cigarette tax—shall cost more than 25 per cent. more in Scotland than it does in England. That, in a nutshell, is what my Amendment seeks to achieve.
Am I right in anticipating the possibility of these financial powers having to be given? I believe that there is ample evidence to show that we should prepare in anticipation of that happening. In the 1975 White Paper, the Government said:
"Some powers for the devolved Administration to levy additional taxation would give them greater freedom and give them a useful degree of discretion".
They have shown that they attach some importance to that by giving the proposed surcharge powers on the Scottish rates. That was their 1975 White Paper, and in the 1977 White Paper they said in paragraph 23:
"As was made clear in the November 1975 White Paper, the Government would see no difficulty in principle, and certain advantages in practice, if the devolved Administrations were to have power to raise limited additional revenue to supplement the block funds".
The Earl of PERTH: From which Command Paper was the noble Lord quoting?
Lord HARMAR-NICHOLLS: I quoted from Financing the Devolved Services, Cmnd. 6890 of 1977. They made it perfectly clear there that they anticipated and welcomed it, and therefore we should be silly to ignore that. Indeed, speaking on Second Reading on 14th December, the Secretary of State for Scotland set out eight criteria against which any supplementary tax would have to be judged. He said that the tax—anticipating this tax which will have to come—must

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be operable as a marginal supplement capable of being turned on and off as needed; it must be cheap to collect in relation to the revenue to be raised; it should fall on Scotland and Wales only and not be paid directly or indirectly by English tax-payers; conversely, it should not permit evasion by a change of business location; it must be compatible with European Community requirements; it must be broadly based and not restricted to special groups; and it should not significantly affect the management of the United Kingdom economy.
Those were all clear anticipations of what, if we accept this Bill or anything like it, will be inevitable. Those being the facts as I see them—my Amendment is not tilting at windmills but is a very clear anticipation—I suggest that when they get these powers there should be a restriction to the effect that they can increase any individual item of tax by up to 25 per cent. and that the total must not be more than 10 per cent. of the total block grant.
In addition to what was anticipated in those Government publications, we must bear in mind the view expressed by Scottish Nationalists, who, despite the local government elections of a couple of days ago, are still a force to be reckoned with and who intend to go on fighting. I cannot put out of my mind that Margaret Bain, the Nationalist MP for Dunbartonshire East, said in the debates on this Bill in another place that the Nationalists stood for full independence within the Commonwealth, that she did not join the SNP to work for devolution, that she had to use a British passport but that she looked forward to the day when she had a Scottish one.
In the Commons all the Amendments put down were attempts by the Scottish Nationalists, and some Members of the Government Party, to give Scotland not just the trappings of reality, but all the powers of being an economic sovereign State. That is the situation as it exists, and it is right that we should recognise that, if the Bill eventually goes through in anything like its present form; they will be driving wedges into it and eventually getting everything.
I have to argue, or appear to argue, against what I said in the past. The
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block grant will not work. The block grant will bring with it so many of the conflicts to which I have referred in the past that the lesser of evils will be to give them power to raise their own taxation. The reason the block grant will not work is that it is based on a notional sum and on what are notional needs, and bears no relation to the real hard facts of living today. For example, they are constrained within the block grant as to what they can spend. So the reality is this. If the Assembly decided to spend more on education, they are restricted within the bounds of their own block grant. If they spend more on education, it could only be at the expense of having less to spend on housing or on health. Then there would be the situation where the Scottish Assembly were justifying their extra expenditure on education and blaming Whitehall because they had no money left to spend on vital housing and health matters which would be very much in the minds of the ordinary citizens of Scotland.
The only other alternative— and this is what will happen unless we give them powers to raise some extra taxation—is that they will ask for the block grant to be increased again and again. We have just been discussing the per capita situation in which at present the people of Scotland are receiving about £360 per head, as against £280 per head that goes from the Exchequer to the British people. When one realises that one can see that nothing but aggravation could flow from not replacing the block grant with some form of tax arrangement.
The Government know this. There are two circles that must be squared, and so far the Government have shied away from both of them. But the Bill cannot become an Act until the Government have faced up to squaring the circles. The first is the West Lothian situation. The situation must be so arranged that if Scottish Assembly Members are to prevent British Members of Parliament from talking about the devolved matters, then they must have less membership in the Westminster Parliament, or they must be restricted to talking only on matters that have not been devolved. That is the first circle that has to be squared. It must be done, otherwise the Bill will not become an Act.

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The other circle which has to be squared involves the question of where the money is to come from to meet the needs. Which is most likely—extra block grants which cannot be given without causing conflict, or giving powers to raise taxation? The Government know this, because they have said this in many of their publications, but they do not know how to administer their tax powers if they get them. They have examined all of them. They have said, "We cannot have income tax because it is too expensive to collect, and it would need another 2,000 staff to administer it". The 2,000 staff would be based upon Scotland, and for every extra tax official there has to be an extra person on the bureaucratic side of industry itself which makes the employment possibilities that much worse. So they cannot use income tax.
They cannot use VAT. To try to use VAT to get the extra money would be illegal under EEC regulations. There must not be a higher rate in Scotland than in the rest of Britain, otherwise there would be an infringement of our European commitments. They cannot have a general sales tax for the same reason. They thought of a rate supplement, but the local authorities will not have it. All these things go to show that this circle which has to be squared is not capable of being squared, on the admission of the Government themselves.
So I believe that we have now got to anticipate that, sooner rather than later, if this Bill or anything like it is to become an Act, they are going to have powers to levy taxes. At this stage, and so that it can be clearly understood on all sides, I believe that my Amendment, which limits the amount of extra tax they can implant in the interests of both Scotland and England and indeed in the interests of the unity of the United Kingdom, ought to be written into the Bill now. I hope that some indication will come from the Government Front Bench that they are prepared to consider this. Without the squaring of this one of the two vital circles this is a nonsense and it will not work. The conflict which I have foreshadowed in almost every speech I have made will be almost certain. The possible effects of this Amendment will not be to remove the conflict, but it might possibly minimise the
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effect of some of it. It is in the confidence that that will bring forward something like a favourable response from the Government Front Bench that I move the Amendment.
Viscount MASSEREENE and FERRARD: What my noble friend behind me is saying perhaps I might say in a shorter way than he has. He is saying that if this Amendment is written into the Bill, and if the people of Scotland understand the Bill—which, with due respect, I very much doubt—then of course in the referendum they will vote against it. I would not particularly worry about that eventuality. I should be quite happy if that happened. But as a property owner in Scotland I would view with great trepidation the idea of having to pay 25 per cent. more tax than the tax which is broadly based throughout England. Having said that, I will say no more. I do not think this Amendment is practical, but I would not object if the Scottish people threw this Bill out when the referendum comes before them.
10.2 p.m.
Lord VAIZEY: I find this an ingenious and attractive Amendment and I think it deserves serious consideration. The noble Lord, Lord Harmar-Nicholls, drew attention to the fact that the Government in their White Papers asked for ideas on this subject and their mind is certainly not closed on the subject. I agree with the noble Lord, Lord Harmar-Nicholls, and, as I said on Second Reading, I am convinced that if it is not included in this Bill it will be included in an amending Bill which will come before Parliament. I have thought that this was the central issue on which devolution stands or falls.
Having said that, I should like to reassure the Committee that this is the last speech that I shall make at the Committee stage because after this we leave the vexed subject of finance. It is rather amazing that there are only two clauses dealing with finance in a Bill of this length which is mainly about finance. Although I am not a Scotsman, I feel obliged to speak to this Amendment. There are few Professors of Economics in your Lordships' House, and as I am the only one under 50, at this time of night

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I think it is my duty to stand up and say that my profession ought to inform your Lordships what they think about this issue. Among the enormous volume of stuff which came out in the preparation for the Bill there was a not very good discussion paper on taxation which included a number of highly controversial statements like the one the noble Lord, Lord Harmar-Nicholls, has referred to, on the cost of collecting income tax in Scotland. It seemed perfectly preposterous. It was put forward as though no one had ever suggested before that income tax could be collected by any other body than the present body which collects it.
In 1922 when the 26 Southern Irish counties became virtually independent, all the powers were transferred overnight to the Southern Irish Parliament, and as far as I know the collection of taxes went on as usual without any relation whatsoever to the number of tax collectors in the Southern Irish State. So I do not think this is beyond the realm of practicality, which was really the ground upon which it was declined to put these clauses into the Bill as it was presented to another place.
Without wearying your Lordships, I hope, perhaps I may briefly take your Lordships through the certain stages in the argument which I think persuade me that the Amendment moved by the noble Lord, Lord Harmar-Nicholls, not only deserves serious consideration but might be acceptable to the Government. The problem, as we said earlier on when debating other Amendments, is that at the moment we have parity of services in the United Kingdom. That is the principle upon which we have hitherto operated, though it is slightly tilted in favour of Scotland, for reasons which we fully understand. The basis upon which the revenue is allocated to Scotland for expenditure is quite clearly spelt out within the Treasury. The amount which will be given to the Assembly is also perfectly clear: it is the amount which now appears on the Scottish Vote minus the expenditure on the powers which are reserved to the Secretary of State for Scotland. That is perfectly simple; so that what you have is the present sum—say £1,000 million—minus, let us say, £200 million which is set aside to the
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Secretary of State for himself or herself to spend direct. That is perfectly sensible.
However, there is no reason to suppose that any amount of tax which is collected in Scotland will meet this sum. There is no reason that one can think of in logic why the amount of taxes pad by the Scots should equal the amount of money which is spent by the devolved Assembly. That is the crucial problem of logic which faces the Government. So the Government have got out of this, as they have perfectly candidly explained throughout the whole debate, by saying, "That is very simple; we shall therefore give no taxation powers at all to the Assembly". Quite candidly, I think that not only is this highly conducive to irresponsibility in the Assembly, in the pure sense of the word—this is representation without taxation, which is exactly the reverse of the American revolutionary position—but, secondly, that it is, as the noble Lord, Lord Harmar-Nicholls, has said throughout, the major basis upon which there will be conflict between, on the one hand, the English and Welsh representatives in the Parliament of Westminster, and, on the other, the Scottish representatives. The conflict is absolutely inherently built in.
Therefore, it seems to me that one will either have to have an Amendment which is not before the Committee—that is to say, an Amendment spelling out the actual allocation of money according to a formula which could be alterable only by an Act of Parliament; in other words, it would be a big business to get it changed, which would remove it from practical politics as an annual debate or, alternatively, one will have to put some brake on the Assembly by giving them taxing powers. It will be a brake because they will then get the unpopularity for spending extra money on the services which they tell the electors they are going to provide them with if they are fortunate enough to be elected; but unless we put on some brake of that kind we shall be in exactly the position which the noble Lord, Lord Harmar-Nicholls, has mentioned, which is that the excellence of the Scottish educational service will be attributed to Edinburgh and the poorness (if that is the case) of the Scottish health service will be blamed on Westminster.

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Therefore, for reasons along these lines, which is the way that the whole reasoning in the White Papers has gone, I find myself driven to the conclusion that an Amendment of this kind ought to find some sort of favour among your Lordships tonight, or at least perhaps at Report stage.
Lord MOTTISTONE: Perhaps I may intervene at this point to say that I very much agree with the noble Lord, Lord Vaizey. It seems to me somewhat unusual that we in Westminster—perhaps not ourselves, but our friends in another place--should have taxation powers, and that rates are raised by all the local authorities, yet here we have a body of people who are in the middle, in a sort of way, who have not got that authority. I do not hold any brief for this particular Amendment, but it seems to me that, as the noble Lord, Lord Vaizey, has been saying, it is something which will come, and perhaps it would be wise of the Government to anticipate the wish to exercise this authority and to give rather greater care to devising some means by which powers of taxation could be given to the Assembly. The noble Lord, Lord Vaizey, said, as far as I could gather, that the South of Ireland happily went on taxing regardless of what the United Kingdom Government said. I think that it would be most undesirable if the Scottish Assembly, after perhaps a year or two, were to take the bit in its teeth and say, "We will jolly well do not only taxing but some other thing against the Act", as it then might be. How are we going to discipline them? Are we to withhold the block grant? We should have to be very careful about that.
When we come to a point which could be a fundamental issue of this nature, we in the United Kingdom Parliament would be wise to anticipate the issue rather than to try to sweep it under the carpet. I should have thought that the Government could usefully consider this as something to which they perhaps might have a better solution than that of my noble friend; but something which gave the authority for taxation to what is to be a Parliament which will think itself superior to local government, observing that local government has a method of taxation of its own.
10.12 p.m.
Lord MORRIS: I must persuade Lord Vaizey not to go—he suggested that he might do so—because the financial clauses do not finish at this stage; they go on from Clause 40 to Clause 58. They are very important and I should be sad if he were to go. It is very important to stress that in the House of Commons, the 19 financial clauses, with Schedule 9, were allotted only a single day under the timetable. The only discussion on them was in respect of two Amendments to Clause 40. There was no "Stand part" Motion on any financial clause at all, or in respect of Schedule 9.
Since no "Stand part" Motion was put on Clause 40, let alone on this clause (Clause 44) the Minister in another place was able to confine his response to the narrow matter raised by the first Amendment and in criticising details of the second. Before he allowed himself to consider any of the fundamental matters raised, the guillotine cut him short in mid-sentence after the words:
"an exercise in an on-going Government decentralisation of power".
This was an unhappy phrase, but one that reflects the Government's evasiveness generally on a financial problem no one has been able to solve—not least the White Paper of July 1977. Thus, the arguments in another place about the financial provisions have gone not an inch further than they were under the July 1977 White Paper. The question of how to provide the essential independent tax-raising powers for the Assembly is entirely unsolved. The Commons were loud in their denunciation of this. Mr. Tarn Dalyell said in column 1681 of the Commons Hansard:
"I think that the House of Commons is not carrying out"—
Lord MOTTISTONE: I have a feeling that there is a Rule of the House by which individual Members of another place cannot be quoted by name for the speeches that they may make in that place.
Several noble Lords: Hear, hear!
Lord MORRIS: I must aplogise for that. I was not aware of it. I have heard

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several noble Lords quoting names before. I thought this was the practice.
A noble Lord: Paraphrase!
Earl FERRERS: A noble Lord is entitled to quote a Minister of another place or to paraphrase a Member.
Lord HARMAR-NICHOLLS: If we could not quote Enoch Powell, Mr. David Steel and one or two other people, there would be no speeches to make, I think!
Lord MORRIS: There should be no question, in my opinion, of the necessity for independently-raised revenue if the Assembly is set up. The failure of both White Papers of 1975 and 1977 to acknowledge the sine qua non nature of the principle merely reflects the equal failure to find an answer. The Secretary of State for Scotland is known to be deeply unhappy about it. Indeed, speaking to an international meeting of economists in Edinburgh last year, he said:
"I frankly admit the Government are not satisfied with the block grant system we have arrived at".
The 1977 White Paper, Financing Devolved Services, saw no difficulty in principle and certain advantages in practice if the devolved Administration was to have the power to raise additional revenue. It was seeking a tax which would make it easier for the devolved Administration to vary the level of public expenditure in the devolved services, and to make it accountable to the electorate for raising the revenue concerned.
All this acknowledges the worries that were at least openly admitted in the anodyne paragraph, No. 69, of the same White Paper, that the financial arrangements could be a lasting cause of argument and disagreement and they could threaten political stability.
By proposing this method and this amount of legislative devolution, and without giving to the Assembly even the financial accountability of a local authority to its own electors, the Government have posed an impossible problem, to which they have no solution, while admitting that one must be found. If Scotland is to have tax-raising powers, clearly the
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extra tax burden should fall on the beneficiaries of the extra expenditure resulting —the more so since Scotland is already receiving per head a much greater proportion of national expenditure than the average. The Government have accepted the need for separate tax-raising powers beyond the block grant. The White Paper of 1974 proposed a rate surcharge, as your Lordships may recall. but that was too unpopular, making the regions the tax collectors; and anyway the unfairness of the rating system is certainly questioned.
The powers, then, exist in principle; the problem is only about method—which problem has stymied everybody. However, since the necessity for those powers is regarded by most people as paramount if there is to be a stable Assembly at all, the least that must be done is to place on record, through provisions in the Bill, what those powers are to be. It would be entirely improper to offer in a referendum a Bill which necessitates the transfer of a tax-raising power, accepted in principle by the Government, but which by admission conceals what lies in store for Scottish taxpayers. There is also some constitutional impropriety in the Government's offering discussions to future devolved administrations about tax matters which have received no Parliamentary sanction.
There is the strongest argument, moral as well as political, for providing in the Bill for some form of devolution of some tax-raising power, with due limits as to amount and the sources. Indeed, only this afternoon the noble Lord, Lord Kirkhill, said, while speaking on another Amendment, that the Assembly should not be fettered or tied to the apron strings of Westminster. This Amendment would loosen the bow and allow the Assembly a measure of financial accountability and responsibility.
10.19 p.m.
Lord WILSON of LANGSIDE: I am bound to say that I am much impressed by the arguments which have been presented to your Lordships on this Amendment by those noble Lords who have spoken in favour of it, particularly the noble Lords, Lord Harmar-Nicholls and Lord Vaizey. I am bound to confess that beyond that I do not think I can add in this particular area to the collective

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wisdom of your Lordships. Indeed, as we approach the financial clauses of this regrettable Bill, I had anticipated a certain amount of confusion in my own celebration. I have some difficulty with my own financial arrangements and I never imagine I could make a substantial contribution to the arrangements of my own country in this particular area.
However, the state of confusion to which I have been reduced by some of the answers which we have had from the Government Front Bench this evening is of a rich and rare quality which has surpassed my wildest expectations. I rise mainly for one purpose; that is, to ask the noble Lord, Lord Vaizey, as I think the noble Lord, Lord Morris, has done already, not to leave us just yet, because he is very helpful to a simple, humble lawyer like myself. Furthermore, I am able to understand him, whatever may be my difficulties with those who occupy the Government Front Bench.
Lord DRUMALBYN: I wonder whether I could put a slightly different point of view. I listened with fascination to the noble Lord, Lord Vaizey, but what he seemed to me to be saying was that, if you stand for election, you make certain promises of improvements. But, mark you, those who are standing for election in other Parliaments may be promising similar improvements at the same time, so that these may cancel out. But what, so far as I can see, is being suggested is that if you are standing for the Assembly in Scotland, and your Party makes certain promises which involve expenditure, you have at the same time to say, "Of course, this will cost money, and if you agree to this we shall go to the Chancellor of the Exchequer, not the Assembly, and ask him to put a tax on Scotland, in order to cover the expenditure that I am suggesting". This is what is called an economic model and it is a political non-starter.
We all understand that this is a crucial question, but surely, for the time being, we have to maintain the main resolve, which is to maintain the unity of the United Kingdom. That means, in general terms, taxation unity, unless and until you can suggest particular taxes for Scotland—or for any part of the country, if it comes to that. But to propose that now, at this stage, would be an error.
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I agree that, from the point of view of those who want to do their best to ensure that the referendum goes against the Bill, it is a very good idea to say, "Of course it will cost you extra, and, what is more, there will be a differential tax in Scotland compared with the taxation in England and Wales". That will mean that people tend to go away from Scotland; the per capita contribution will be reduced, more people will go away from Scotland and so on. I do not think that that makes sense at the present stage.
I feel that the Government's offer to listen to proposals should be considered first. As we all know, proposals of this kind take a long time to examine, and after the Government have accepted that a certain tax can be imposed, it generally takes quite a long time before it can come into effect. So this is surely a long way off at the present time. The noble Lord, Lord Vaizey, shakes his head and wants to fix it right away. I accept the logic of what he says, but the practicality of it I would heartily deny.
Lord HARMAR-NICHOLLS: Before my noble friend sits down, did he say that, if we genuinely think that what is likely to flow from this Bill is extra taxes, we ought not to let the people know before we have the referendum? I should have thought that common decency, apart from good sense, would insist that if you think that there is a reasonable chance—and there is more than that—that this will happen, it ought to be said in advance so that people know what they are doing.
The argument that my noble friend used, saying that this may be a long time ahead, was very much in line with what was said by my noble and learned friend Lord Hailsham of Saint Marylebone. When I was speaking about dynamite my noble and learned friend said that dynamite has a long fuse. However, the length of the fuse on dynamite does not alter the fact that dynamite can be damaging. I should like my noble friend to make it quite clear that he is not suggesting that those of us who think that this might happen do not have a duty, much more than a sense of decency, to put it on record so that people know what they are voting for.
Lord DRUMALBYN: My noble friend has asked me a question which I shall answer right away by saying that I do not think that additional expenditure in Scotland is necessarily required. One cannot envisage this immediately. If one continues to treat the United Kingdom as a whole and to make rate support grants and so on in relation to the need of the separate parts of the United Kingdom, whether they are in Scotland or in other parts of the United Kingdom, I do not see that there is an urgent necessity for taxation. I see the political argument about responsibility for one's actions and promises when one stands for Parliament, but I think that we must wait a little to see whether any such steps to curb wild and extravagant promises that are postulated by people who stand for the Assembly in Scotland are realised in any way.
Lord MACKIE of BENSHIE: Is not the noble Lord, Lord Harmar-Nicholls, failing in his duty? Apparently he wants to point out to the Scottish people during the referendum every single possible factor which may arise from this Bill. In this Amendment he should also postulate the fact that the Assembly may be so competent that it will be able to reduce expenditure and be able to ask the United Kingdom tax authority to reduce income tax by 10 per cent. The noble Lord would need to do that; it is quite a possibility. If the noble Lord would like me to do so, I could give to him many other fairy stories which he could postulate for the Scottish people. However, I do not want to provoke him any further, in case he goes on even longer.
Lord VAIZEY: The reason why I was rather rudely shaking my head, if I may answer the point made by the noble Lord, Lord Drumalbyn, was because I thought that the Amendments were seeking, with the support of the arguments which the Government have brought out in their White Paper, to avoid an annual wrangle. That is the central question. An example which I might give to the noble Lord is that council house rents in Scotland are, as we know, phenomenally low. If the Scots wish to improve their health service—and goodness knows! the health service has deteriorated throughout the whole of the United Kingdom since
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the so-called reform in 1974—and if they say that they want a better health service, which would be a perfectly reasonable thing for anybody to say, under the Bill the only way that they could pay for it would be by putting up council house rents.
Nobody in his senses would stand for the Assembly and say, "I am standing on the basis of switching expenditure from housing to hospital services". That is what the Government want him to say, but he will not say it. What he will say is that he will come to Westminster and say that he wants to change the formula. The Bill says that the formula may be changed every year, with reasons. That is precisely the point on which the row will take place.
Lord HYLTON: I should have thought that an annual wrangle was completely unavoidable, whether or not one has the Amendment. This is borne out by what has gone on in Canada for a very long time between the Federal Government and the Provinces.
Lord DRUMALBYN: There has been an annual wrangle so far as Northern Ireland is concerned for a great number of years. I admit that this argument is a little tendentious because there are special circumstances affecting Northern Ireland. I take entirely the point which the noble Lord has made about the lowness of council house rents in Scotland. He will know very well that this is an historical fact, dating from before the First World War, and that it ought to have been remedied many years ago.
Lord O'NEILL of the MAINE: If I understood the noble Lord, Lord Drumalbyn, correctly he said that there had been an annual wrangle about the finances of Northern Ireland for many years. Certainly at the time of Northern Ireland devolution, as opposed to the present system, there was no annual wrangle whatsoever. I was Minister of Finance for seven years and I should like the noble Lord to know that I had the friendliest relations with the British Treasury. There was no annual wrangle whatsoever.
Lord DRUMALBYN: I accept that entirely, but the words, "annual wrangle"

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were used for discussions on finance, and that was the sense in which I was using the term.
10.30 p.m.
Lord McCLUSKEY: The problem may be in the use of words. Some people might describe what we have been having for the last hour or two as a wrangle, but I would not dream of using such a term. I thought I understood the purpose of this Amendment until I heard the noble Lord, Lord Vaizey, say that the purpose of it was to avoid an annual wrangle and the noble Lord, Lord Harmar-Nicholls, shook his head in agreement. That astonished me because I understood that the purpose of this Amendment was to reflect the conclusions which the Government had set forth in the White Paper of 1977 and to put them in the form of words into the Bill. Furthermore, I thought the clear purpose of the Amendment was to try to pave the way to providing a tax-raising power supplementary to the fundamental financing which was by means of the block fund. If I have misunderstood him, I ought to sit down in case I confuse further the noble and learned Lord, Lord Wilson of Langside, who is apparently already confused.
Lord WILSON of LANGSIDE: The noble and learned Lord has confused me a little because I would have thought that if the noble Lord, Lord Harmar-Nicholls, was shaking his head he was expressing disagreement and not agreement.
Lord HARMAR-NICHOLLS: The noble and learned Lord has described the position perfectly, except that he did not listen to the whole of my speech and I do not blame him for that. What I said was that if what was anticipated did not happen then there would be applications for an increased block grant. So the sword that I was trying to describe to the noble and learned Lord is two-edged: if you do not do what I anticipate and allow for it, you have one problem; if you do it, then you have another.
Lord McCLUSKEY: I have a well-calibrated ear; I only hear the parts that I want to hear. Having said that and having looked carefully at the Amend-
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ment, we would certainly use the same word as was used by the noble Lord, Lord Vaizey: it is an ingenious Amendment and what the proposers have done is to produce a form of words which reflects many of the conclusions which the Government have themselves reached on this question of devolved tax powers; and in particular the wording here incorporates several features which the Government have repeatedly stressed are important. First, the devolved tax would not be a primary source of revenue but a supplementary source of revenue—supplementary to a block fund provided as outlined in the Bill—and a devolved Administration would decide when the supplement was to be charged. That is a good feature.
Secondly, the total to be raised in this fashion would be limited in the way prescribed clearly in the Amendment. Thirdly, the tax would be an addition to a tax raised nationally and would have to be broadly based and general throughout Scotland. Fourthly, the additional administrative costs would fall on the Scottish Administration. These are not the only features and I should mention others to make it quite clear. There would have to be a resolution in the Assembly, asking the Chancellor to apply a supplement of up to 25 per cent. to certain taxes. I mention that because one of the features of a tax, if there is to be a tax, is that it must be politically possible. I think one has to set that aspect of the matter against political possibility. There has to be a decision by the Secretary of State as to whether this resolution was acceptable in the light of Community obligations and other criteria to be laid down by him; and then there must be a transfer of the net balance, after meeting administrative costs, to the Scottish Administration.
I hope I have understood the bones of the Amendment and properly described them. On analysis, it appears to us that the reference to Community obligations would certainly rule out a surcharge on value added tax. What we should be left with as broadly-based taxes would be income tax, corporation tax and the local rates, although it seems rather doubtful whether the noble Lords in whose names this Amendment stands had the third of these in mind. Did they really suppose that it would be the local rates which

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would be surcharged in this way? And do they, in fact, therefore intend that the Assembly should be able to demand a 25 per cent. surcharge on income tax or corporation tax or the rates? I am going to ask the noble Lord, Lord Harmar-Nicholls, which tax he has in mind; perhaps he will address himself to that when he comes to reply.
The Amendment puts a ceiling on the amount of extra tax to be raised. In total, it must not be more than 10 per cent. of the block fund and the increase in any tax must not be more than 25 per cent. of the rate otherwise obtaining. I must give some figures to make the position clear. It is estimated—and one sees this in the White Paper, Table 3—that, in 1975–76, 10 per cent. of the block fund would have been about £187 million, and estimates have been obtained of the proceeds of the principal taxes in Scotland in that year. £187 million would have represented about 14½ per cent. of the proceeds of income tax, about 45½ per cent. of the proceeds of local rates, and about 134 per cent. of the proceeds of corporation tax. In effect, therefore, the Amendment is really talking about a surcharge on income tax alone, or perhaps in combination with substantial surcharges on some other tax or taxes.
Under the Amendment, the final decisions as to what extra rates of tax should be imposed on people in Scotland would rest with two Ministers, the Secretary of State and the Chancellor, and they could under the Amendment, without any further need for legislation approved by the people's representatives in Parliament, impose an increase of over 14 per cent. in the rates of income tax in Scotland. I should have thought that an odd conclusion for the noble Lord to drive us to, for he belongs to a Party which constantly says it wants to reduce income tax, yet here is a proposal which effectively means that it can be raised by 14 per cent. without scrutiny by the Westminster Parliament.
Surely the noble Lord, Lord Drumalbyn, is right—and I hope I do not embarrass him by constantly welcoming his positive contribution to these debates—in saying that this kind of provision has got to be looked at in detail in primary legislation at Westminster, and not by the kind of route that would be taken if one followed the Amendment. It is the Government's
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view that such primary legislation would have to be put through Westminster after the most careful consultation with the Scottish Administration.
I do not seek to conceal the fact that this is a problem which has worried the Government from the start, and all the published documents have shown the Government's concern, have shown that the Government would have liked to produce a solution and have not been able to produce a solution which they can put into the Bill. I do not run away from that, and I could not, seeing what appears in the various White Papers. But I do implore noble Lords who have spoken, if they are not familiar with the two White Papers, to look at them very carefully, and in particular to look at the White Paper published in 1977, where, as I think I mentioned in my wind-up speech at Second Reading, the arguments about taxation are set forth with great clarity. The noble Lord, Lord Harmar-Nicholls, has got to produce an answer to those arguments if he is to persuade us that this kind of Amendment is worth putting into the Bill.
In the White Paper, having reviewed all the possibilities in what I believe is convincing detail, the relevant factors are all set out. The Government decided:
"On balance, and taking into account the general practicability and likely public acceptability of each tax method examined, the disadvantages outweigh the advantages".
That was said after a careful examination of the pros and cons of each of the individual taxes. The Government have not changed their conclusion on that, and indeed since the publication of the White Paper, along with the evidence on which it was based, there has been very little serious challenge as to its wisdom, as to its analysis, or as to its conclusion. The Government's conclusion was indeed supported by a very large and broadly based majority in a Division in the other place.
As I say, we have attempted to face this problem over a period of years, for we believe that, in this matter, as indeed in all other matters, honesty is the best policy. We have sought to make it clear that we are ready to accept and agree to a supplementary tax if an acceptable basis can be found. We have set out the difficulties. If an acceptable basis

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can be found, we hope to agree it with the Scottish Administration and come to Parliament with a view to legislation to give tax powers. At the moment they are prohibited by Schedule 2, paragraph 4.
In conclusion, I submit that this is a reasonable and honest position for the Government to adopt. I would respectfully suggest that it is more straightforward than the position adopted in the Amendment, because the Amendment implies that there is available somewhere a choice of broadly-based taxes which are general throughout Scotland and about which the Assembly and the Ministers need only make up their minds. We all know that this is not so. The White Paper demonstrated that it is not so.
As I sought to demonstrate, the Amendment, in practice, relates to a major surcharge on income tax, which is not politically possible. The Government, having stated their views so clearly in the White Paper, could not now credibly accept an Amendment based on an assumption as to the range of options—an assumption that they have shown to be, and now believe to be, mistaken. The Government believe that the only proper and honest course is to hold back these matters for discussion with the Scottish Administration, once it is there. Then, if the tax powers are to be devolved, it would be made clear what these powers are to be and what constraints must be applied in their use. Then we shall not deceive ourselves simply by thinking that we have solved the problem by using the form of words to restate it—a form of words which implies that the difficulties, which are real, do not exist.
The ingenuity which lies behind this Amendment is the ingenuity of the conjuror. The blandness of the assumptions disarms the critics. But the assumptions are there. If I may, I should like to ask Lord Harmar-Nicholls, through the Committee, what does he have in mind? What tax will fulfil all these assumptions and be politically possible? If he will answer that question, he will do me a great service.
Lord HARMAR-NICHOLLS: It is common form, and a tactic as old as the hills, for a Government, who have not got an answer to a question that they
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know is there, to ask somebody else what his answer would be. This is an occasion where the noble and learned Lord has been completely honest. He made it perfectly clear that this is a vital problem. It is a vital weakness in the Bill. The Government have no answer to it. That is what he made perfectly clear. He said, "We have looked at all sorts of alternatives and we cannot find an answer". Therefore I have achieved what I wanted in putting down this Amendment.
I wanted to disclose that this is a phoney Bill—a Bill with no real base—because the one outstanding question from which all the problems will flow is incapable of being answered. The Government have made that perfectly clear. Of course I do not know which particular taxes would have to be put on to meet the words in my Amendment. I said that when I proposed the Amendment. That is what the Assembly would have to do, if there is an answer. The whole purpose of the Amendment—the whole purpose of my argument, a purpose confirmed by the words of the noble and learned Lord himself—is that this is a fundamental weakness in the Bill to which there is no answer.
If there is a conjuror in this House, it is the Government because the impression they are giving is "Pass the Bill. We know that this fundamental question has not been answered, but once the Bill becomes legislation, once it is an Act, and all the powers are there, we shall produce a rabbit out of a hat"—just like Dick Barton makes the change and says, "That will solve the problem". It is a cheating conjuror's trick. This Bill depends at the end of the day upon a referendum decision by ordinary people who can be cheated by sleight of hand. It is not a Government's job to do that. I believe that, before this Bill is put in the form of a question at a referendum, this question must be answered, not by those who, like me, oppose the Bill, but by people who are foisting this Bill to try to make it an Act which people must support.
I think that the point has been made. I hope that, in all the other debates that we have both in Committee and on Report, this sleight of hand by the Government, this conjuror's trick of theirs, which they try to hide by calling somebody else the

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conjuror, will be seen. I hope that many people, who, to begin with, may have had some sympathy as regards solving the Scottish problem by this Bill, will see that they are taking on more trouble than they thought they had in the first place. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 44 shall stand part of the Bill?
10.46 p.m.
Lord MACKIE of BENSHIE: I shall not detain your Lordships for long, but I should like to say that the question of taxation is one which has exercised my collegues and I, and obviously the Government, greatly. It is perfectly true that anybody who draws his money in the form of a grant, tends to blame the giver of the grant for any shortage which he may occasion himself. That is really why we support the fact of a formula being used to determine the grant and to determine it over a period, because at least in those circumstances we shall not have an annual wrangle with the Treasury over particular projects. In other words, the responsibility will lie with the Assembly within the regions defined by the block grant, and it is possible to do a great deal within that. It is true that in modern administration it is very difficult to move expenditure beyond about 2 per cent.—in fact that is extremely good. However, 2 per cent. on £2,000 million is, of course, £20 million a year. We think that the Assembly will be able to exercise responsibility and very much so for the first four years.
The Assembly has a tremendous amount to do in settling down, arranging its procedures and as regards the devolved subjects of immense importance to Scotland, such as health and education, to mention just two. In that respect we are perfectly certain that the first four years will be enormously important. The Government have said in the White Paper that they will consider any suggestion that the Assembly may make as regards taxation after that. Therefore, by and large, I am sure that it is for the health of the Assembly and the future of Scotland that the block grant system is adopted, at least for the first four years until a great deal of experience is gained.
Clause 44 agreed to.
[Amendment No. 363 not moved.]
Clause 45 agreed to.
Clause 46 [Short term borrowing by Scottish Executive]:
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 158:
Page 23, line 15, after ("may") insert ("with the consent of the Treasury.")
The noble Lord said: Amendment No. 158 and the following two Amendments are simple probing Amendments. Therefore, I beg to move Amendment No. 158 on behalf of my two noble friends and suggest that Amendments Nos. 159 and 160 be discussed at the same time. We have not probed Clause 45 with Amendments or spoken on the Question, Whether the clause shall stand part?
The Amendments enable us to ask the Government to give us, if they can, briefly the thinking behind these two clauses on loans. Clause 4:5 provides what one would expect for a Bill where large sums of money are to be advanced, in this case to the Scottish Loans Fund. The consent of the Treasury is required at various stages and the provision at the end of the clause states that an order has to be passed by the Affirmative Resolution procedure.
However, as regards Clause 46, we have drawn attention to the fact that the consent of the Treasury is not required at all and that the procedure for an order to be made is the Negative Resolution procedure. Our other Amendment is simply to discover why the Government have chosen £75 million; what has prompted them to consider that to be the limit? Clause 46, to which these Amendments apply, is for the short-term borrowing—overdrafts, and so on. Clause 45, which is clearly for larger sums of money, is for times which are not stated. It simply says:
"… such times and with interest at such rates as may be determined by the Treasury".
Therefore, I should be grateful if the noble Lord could give us an explanation why the terms of the short-term borrowing clause are so different and what prompted the Government to choose £75 million as the maximum. I beg to move.
Lord KIRKHILL: As noble Lords will know—and, indeed, as the noble Lord, Lord Campbell of Croy, has been pointing out to us—Clause 46 empowers the Scottish Administration to borrow short-term in order to cover temporary deficits on the Scottish Consolidated and Loans Funds. The power will always be used as a last resort, because it will clearly be in the financial interests of the Administration to fund its expenditure to the greatest extent possible without recourse to borrowing, which entails payment of interest. The very nature of the power implies that the need to use it will arise suddenly and fortuitously. In these circumstances it would be impracticable to require the Administration to obtain the consent of the Treasury before borrowing, as the Amendment proposes.
I hope that your Lordships will agree—and I refer to Amendment No. 158 when I speak of the Amendment proposed—that, as I have explained, it will be in the financial interests of the devolved Administration to use the powers as little as possible because of the fact that there is an absolute limit on the amount of borrowing. Finally, because of the practical difficulties upon which I have touched, it would be difficult to accept the Amendment. I know that it is a probing Amendment and that it is linked to Amendment No. 159.
The noble Lord, Lord Campbell of Croy, asked me why the Government have chosen the figure of £75 million. That figure represents the best estimate which the Government can make of the sum which might be involved in the cash flow in the Scottish Consolidated Fund over about 10 working days. Therefore, we can say no more than that it is a rough yardstick. The clause provides for the amount to be increased by order made by the Secretary of State. However, the important point is that the flexibility in managing cash flows given to the Scottish Administration by Clause 46 must not be frustrated by having an unduly low limit laid down. As I have just said with regard to Amendment No. 158, it is self-evident that it is in the Administration's own financial interests to keep its borrowing to a minimum. That is the reasoning behind the £75 million.
I do not think that I can add anything on Amendment No. 160. I do not think that the clause needs strengthening because
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I do not think that the Administration would act in a profligate manner. As I have said, it certainly would not be in its own financial interests so to do, and I should have thought that that was an excellent constraint on any profligate tendencies it may have.
Lord CAMPBELL of CROY: It would seem to boil down to a question of the magnitude of the sums involved. Much larger sums will be involved in Clause 45, and presumably that was why the Affirmative Resolution procedure was to be used there and not in Clause 46. I am grateful to the noble Lord for his explanation of the Government's thinking and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 159 and 160 not moved.]
Clause 46 agreed to.
Clauses 47 to 49 agreed to.
10.55 p.m.
Lord DRUMALBYN Lord DRUMALBYN moved Amendment No. 326:
Before Clause 50, insert the following new clause:
Scottish National Lotteries
("(1) Sections 1 and 2 of the Lotteries and Amusements Act 1976 shall not apply to any lottery promoted under an Act of the Scottish Assembly, the proceeds of which are or are to be paid into the Scottish Consolidated Fund and used to finance or help to finance any project or activity falling within the devolved matters mentioned in the following subsection.
(2) The matters referred to in subsection (1) above are—

(a) the prevention, treatment and alleviation of disease or illness;

(b) education, the arts, crafts, cultural and recreative activities;

(c) development of tourism;

(d) charities other than those whose purposes include the matters contained in paragraphs (a) to (c) of this subsection.

(3) Nothing in this Act shall prevent the sale, offering for sale or despatch to persons, whether within or outside Scotland, of any tickets or chances in any such lottery as is referred to in subsection (1) above.
(4) Sections 35 to 37 above shall not apply to any Bill passed by the Assembly under this section.
(5) In determining what payments are, with the consent of the Treasury, to be paid into the Scottish Consolidated Fund out of moneys provided by Parliament under section 44 above or into the Scottish Loans Fund under section 45 above, the Secretary of State shall take no account of any funds raised under this section.")
The noble Lord said: This is a joyful little Amendment. The Government have invited suggestions for Scotland raising additional revenue for herself, and this Amendment indicates one possible way; namely, by Scottish national lotteries. Lotteries, I know, are included as a devolved matter under Group 21 (Miscellaneous) in Schedule 10, although I rather suspect that it is included there for the Assembly to regulate rather than to run.
I am only too well aware that not all Scots or, for that matter, all English or Welsh folk look favourably on lotteries, however good the causes they are to serve may be. That was not considered as sufficient reason for rejecting the idea of premium bonds. I know the bonds are repayable and the private gains incidental, but the gains on lotteries for charities are also incidental to the sustaining of the charities. Admittedly, the contributions to lotteries are not repayable, but neither are taxes which are supposed to be exacted mainly in aid of good causes.
To ensure that the lotteries under the Amendment are devoted to good causes, we have picked out—my noble friend Lord Glenkinglas is not here—appropriate devolved matters from Schedule 10, in particular from Group 1 (Health), Group 3 (Education), which includes the arts, sports, libraries, museums and art galleries, and we have picked out charities from Group 21, including all charities whether or not included in Groups I and 3. This definition would cover charities related to Group 2 (Social welfare). The money raised could be used to finance, or to help to finance, any project or activity covered by any of these groups. We put in development of tourism because of its importance to remoter and poorer areas, although we would not mind much if it were omitted as not being of the same character as charities in Groups 1 and 3. We put it there mainly because Scotland has found it particularly difficult to get enough money to support the tourist industry in the past.
There are, of course, other countries which run lotteries for all sorts of purposes—for hospitals, even for air forces, and other necessities of life. Subsection (3) follows as closely as possible the Lotteries and Amusements Act. It would, of course, he impossible to stop lottery
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tickets or advertising material about the lotteries from being sent by post outside Scotland, and across the Border, if it comes to that. Of course people in England would not wish them to be stopped, I am sure. If they did the reputation for being mean would quickly cross the Border too. Still less would Parliament want to exercise the powers conferred in Clauses 35, 36 and 37 to prevent Bills and Statutory Instruments establishing lotteries in Scotland, as otherwise they might be able to do on the flimsy and inadequate ground that a reserved matter might be affected. That is the purpose of subsection (4).
Finally, the whole purpose of finding a means of raising additional revenue to meet Scotland's needs would be defeated if the Treasury were to treat the revenue from Scottish national lotteries as the Department of Health and Social Security treats income above a certain level earned by pensioners up to the age of 70. Hence we see subsection (5). Obviously there would be no point in raising this revenue unless it was considered as additional to the revenue put into the Consolidated Fund by the Secretary of State with the consent of the Treasury. I put this forward as an idea, I hope a wholesome one, which should commend itself to Parliament. However, I daresay that if Parliament does not like it now, the Assembly can consider the matter for itself later on.
Lord MOTTISTONE: I support my noble friend's initiative in this matter. If there are any objections in Scotland to lotteries in any form, the fact that he proposes it should be as the result of an Act of the Scottish Assembly would give the Scots an opportunity to debate it among themselves before it came into being. In my view, my noble friend's proposal should be entirely applauded and I hope the Government will give it great support.
Viscount THURSO: This is an entirely excellent and refreshing idea which is meant to be, and I believe is, helpful. It is interesting to note that nearly all the objects for which these lotteries might be held are already the recipients of funds from smaller lotteries, raffles and so on, throughout Scotland. Obviously, if these

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facets of Scottish life are to be helped by the Assembly, it would be perfectly appropriate that they should be helped by a well-run lottery, and in any event that would give some muscle to the Assembly which it will not receive from the Consolidated Fund. My noble friends on these Benches would certainly back this excellent suggestion, and we hope the Government will consider it.
Viscount MASSEREENE and FERRARD: While I, too, support my noble friend's suggestion, I should have thought it would be allowed under the Bill as drafted. Surely such matters would be covered by Schedule 10, Groups 21 and 26, so making the Amendment—which, as I say, is excellent and has my support—unnecessary. Apart perhaps from the Elders of the Kirk, I cannot imagine anybody objecting to the Amendment.
The Earl of PERTH: I also support the Amendment and congratulate the noble Lords in whose names it stands for coming up with an idea which the Government have been seeking; namely, a means—not necessarily by lotteries—of raising revenue by the Assembly. The Amendment has two important features. The first is that it is an entirely voluntary affair; those who do not approve of lotteries—and I know that applies to many people as a matter of principle—need not take part. The second is that these lotteries would be used for admirable purposes, mostly, as the noble Viscount, Lord Thurso, pointed out, for charities which can already be helped in a small way.
It is worth recalling the extraordinary success that Ireland has had in relation to its hospitals by this means; it has been one of the great success stories of the Irish hospitals and I do not see why, if the Assembly so agreed, we should not follow the same pattern in Scotland. Because it is subject to the approval of the Assembly, it is only permissive, and to that extent I fully back it.
Baroness STEDMAN: I am sure the Amendment is meant to be helpful and I acknowledge the support the noble Lord, Lord Drumalbyn, has had for it tonight; but the inclusion of the entry of betting, gaming and lotteries in Group 21 under the miscellaneous head confers a very wide competence on the Assembly to
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legislate in the matter of lotteries. As the Bill stands, the Assembly could pass legislation providing for the establishment of a Scottish national lottery, either with the limited purposes specified in the new clause, or with any others (within devolved matters) which the legislation itself chose to specify.
Lotteries are a form of activity on which very strong views are held by public opinion. The Government take the view that if the Assembly (on the Motion either of the Scottish Administration, or of a Back-Bencher) chose to legislate on the subject, it is desirable that they should have the maximum discretion as to the contents of that legislation. They should, for example, be free to modify, or to apply, Sections I and 2 of the 1976 Act, to the extent they considered expedient. They should also have maximum freedom to apply, as they saw fit, the proceeds of any lottery to be conducted by the Scottish Administration, or by a body set up for the purpose. Parliament should not appear to be dictating to the Assembly what view they are to take on such matters.
Subsections (1) and (2) of the new clause proposed by the noble Lord, Lord Drumalbyn, we think are not only unnecessarily but probably also undesirably restrictive to the Scottish Assembly. In effect, they derogate from the competence conferred by the Bill as it stands at present. The Government see no reason why these restrictions should be imposed: such restrictions as those limiting the purposes for which proceeds can be applied. Why should we rule out the application of proceeds to, for example, the purchase or upkeep of ancient monuments and historic buildings (in Group 19), or the provision of facilities for public enjoyment of the countryside (under Group 9)? Why should we specify in the Bill that they can use their money only for these certain objects?
Subsection (3) seeks to enable the sale of tickets outside Scotland if a Scottish national lottery is set up. Here again, the provision is unnecessary. There is nothing in the Bill at all to prevent a Scottish Assembly Act from enabling people outside Scotland to participate in a Scottish lottery. The voluntary participation of people outside Scotland would not alter the fact one iota that the legislation

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related to the setting up and regulation of a lottery would be conducted within Scotland.
Subsection (4) relates not to the content of the application of Assembly legislation but to the exercise in relation to it of the Secretary of State's intervention powers under Clauses 35 to 37. The intention seems to he to prevent the Secretary of State from moving the rejection of the Assembly's Lotteries Bill (under Clause 35), from directing action to be taken or not to be taken under it (under Clause 36), or from revoking any subordinate Instrument made under it (in Clause 37).
It is difficult to understand why Assembly legislation on lotteries should be regarded as of such a unique character that it alone should be exempt from any ministerial intervention. Such intervention is possible only if the Bill, executive action or subordinate Instrument, would, or might, affect a reserved matter, and if the intervention is considered desirable in the public interest. It may be thought unlikely that such circumstances would arise in the context of Assembly legislation on lotteries. But if they did, why should the Government be, exceptionally, prevented from taking action to protect the reserved interest? From the Government's point of view, this constraint must be unacceptable.
Subsection (5) provides that no account should be taken by the Secretary of State of the proceeds of a Scottish national lottery when he came to determine payments into the Scottish Consolidated and Loans Funds. In other words, such proceeds would be treated similarly to the proceeds of a supplementary tax, such as the Government have expressed readiness to consider providing for if the Scottish Administration so wish. In principle, this is not unreasonable. But it makes little sense to make statutory provision on the matter. The amounts to be paid into the two funds, and the manner in which they are to be determined, are entirely discretionary. The Bill in no way indicates what factors the Secretary of State is to take into account. It cannot, therefore, with any effectiveness specify a factor which he is not to take into account. I am sure that the Amendment was intended to be helpful to the Scottish Assembly, but in view of what I have said about the very wide competence conferred
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upon the Assembly by the Bill, as it stands at the moment, and in view of the difficulties created by the later subsections, I hope that the noble Lord might care to consider the matter, and withdraw his Amendment.
Lord DRUMALBYN: I should like to thank the noble Baroness for considering each of the subsections of the Amendment one by one. When I saw lotteries down in Group 21 of Schedule 10, I thought this meant the regulation of, and legislation about, lotteries; but of course I cannot see into the minds of those who devise these things. I accept that it is intended to cover any kind of lottery over which the Assembly has jurisdiction. Had I realised that, it might have led me not to pursue the matter in the first place. It is quite a surprise to me that the reason for rejecting this Amendment is that it is too restrictive. I shall have to go a little further next time.
As for subsections (4) and (5), it seemed to me that if one is to raise money especially in Scotland by the Assembly, this is something over which the Secretary of State should not have any jurisdiction. I am not sure that I agree with the noble Baroness that this is of so unique a character as to warrant excluding intervention by the Secretary of State. It happens to be the only Amendment of this kind that has come along, and if it is the first one to exclude intervention by the Secretary of State, of course it is unique until the next one comes along. I do not really see that that provides any objection to having at least one provision which is left to Scotland alone. As to the argument that this is a matter which should be left to the Assembly to legislate on, as this is within the power of the Assembly I am bound to confess that I must find that a valid argument, and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord STRABOLGI: I think this is really a good moment to halt the Committee, and I beg to move that the House do now resume.
House resumed.

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