Sitting of 5 February 1979

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  ORAL ANSWERS TO QUESTIONS
  Mr. Speaker: I make one further appeal to the House for questions and answers to be as brief as possible. This is only fair to those right hon. and hon. Members who want to be called to ask their questions.
  ENERGY

    Oil Construction Workers (Dispute)
    Mr. Gordon Wilsonasked the Secretary of State for Energy if he will make a statement on the offshore oil construction workers' dispute in so far as it affects oil production and safe working on platforms.
    The Minister of State, Department of Energy (Dr. J. Dickson Mabon): This is
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    a very brief answer Mr. Speaker. I understand that the unofficial industrial action by offshore oil construction workers has so far had virtually no effect on oil production. It has not yet affected safe working on the platforms.
    Mr. Wilson: Does the Minister realise that, while pay is a not unimportant consideration in this dispute, the workers are, nevertheless, concerned at the long hours which they have to work and their conditions of work? Will he take action to secure some form of package that will enable this strike to be settled?
    Dr. Mabon: I agree with that. If the workers were to take the advice of their trade union officials, both local and national, they would return to work and allow negotiations to continue, and I think that if they did that they would find a favourable response from the employers.
    Mr. Gray: Is the Minister of State aware that on 26 January his right hon. Friend the Secretary of State for Energy met some of the striking shop stewards? Does he agree that that was an act of unmitigated irresponsibility, as the strike is unofficial? Was not the Secretary of State in danger of undermining the authority of the official union view?
    Dr. Mabon: On the contrary. Not only did my right hon. Friend do that, but I myself, at the invitation of some of my constituents, met the shop stewards, some of whom were my constituents. I urged them to do exactly what I have said in

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    my reply to the question, that is, to observe the recommendation of their local and national officials to return to work so that fruitful negotiations could continue.

    Electricity Generating Plant
    Mr. Ronald Atkinsasked the Secretary of State for Energy what plans are currently under review for capital expenditure on new electricity generating plant; and how much is to be spent on nuclear power, coal-fired stations, oil-fired stations, and energy from renewable resources, respectively.
    The Secretary of State for Energy (Mr. Anthony Wedgwood Benn): Current plans, together with power stations already under construction, estimate some £2,100 million would be spent by the Central Electricity Generating Board on generation over the next five years: 53·5 per cent. for nuclear plant; 28 per cent. for coal-fired plant; 12 per cent. for oil-fired plant and 6·5 per cent. for pumped storage. The Government have allocated £16 million to research and development on renewable energy sources.
    Mr. Atkins: Does my right hon. Friend agree that there is need for an integrated policy which takes into account possible conservation measures and which steers away from the use of oil at power stations, bearing in mind that the use of oil increased last year compared to other sources of energy?
    Mr. BennA programme costing £320 million for conservation was announced by myself some months ago. I have made it clear that I am not prepared to authorise any more oil-fired stations, though some ordered in the late 1960s are still coming on stream.
    Mr. Hugh Fraser: Will the right hon. Gentleman bear in mind, in both his current and future plans, that because of the enormous danger of over-capacity in the heavy electrical machine manufacturing industry top priority must be given to orders with export potential? Does the right hon. Gentleman agree that unless that is done we shall see the destruction of that industry in this country? Will he give an assurance that on current orders and future plans the main objective will be to get overseas orders?
    Mr. Benn: Yes, Sir. Export orders are very important, and, as the right hon.
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    Gentleman knows, the Chinese have expressed some interest in ordering. We have a need for such orders very much in mind.
    Mr. Palmer: Does my right hon. Friend agree that both the investment and pricing policy of the electricity supply industry are being steadily undermined by the undisciplined import of natural gas into our fuel economy, with serious consequences for both the electricity supply and coal industries?
    Mr. Benn: I do not know whether gas from the North Sea is an import in that sense. It is an indigenous resource, and the problems of integrating the various fuels, one with another, is at the base of our national fuel policy.
    Mr. Macfarlane: Is the Secretary of State aware that the expenditure which he has just announced on the future of the nuclear industry is likely to be hampered because so far he has been reluctant to announce future plans for the restructuring of the British nuclear industry?
    Mr. Benn: I should like to make progress with that, but it does require the consent of the parties concerned.

    Electricity Discount Scheme
    Mr. Maddenasked the Secretary of State for Energy if he is satisfied with the present arrangements for the electricity discount scheme.
    The Under-Secretary of State for Energy (Dr. John Cunningham): I am satisfied that the arrangements for this winter's extended electricity discount scheme will enable many more consumers with low incomes to benefit from the help it offers than was the case previously.
    Mr. Madden: Is my hon. Friend aware that the extension to which he has referred is most welcome? Will he publish in the Official Report the groups which are eligible for discount? In view of the heavy electricity bills that can be expected this winter, will he intensify his efforts to publicise this scheme so that the maximum number of those who are eligible can apply?
    Dr. Cunningham: The answer to all those questions is "Yes ".
    Mr. Viggers: What is unique about the electricity discount scheme that it should cause the Department of Energy, alone among Government Departments, to choose to subsidise the Morning Star by advertising the scheme in that newspaper on 22 January?
    Dr. Cunningham: There is nothing unique about it. The hon. Gentleman is totally wrong. The Morning Star has been used on no fewer than 10 occasions to display such advertisements.
    Dr. McDonald: Is my hon. Friend aware that since the figure of £20 is the minimum requirement before anybody can take advantage of the discount scheme, it will mean that many pensioners will be unable to benefit very much from it? Will he consider removing this requirement?
    Dr. Cunningham: No, and I must correct my hon. Friend. Although she may understand the scheme, I believe that her words may be misleading. Everybody who qualifies for the scheme this winter—that is between 4 million and 5 million people—will receive the £5 payment, except those who are paid in receipt of rent and rate rebates. A significant number of people will get £5. It is only for those with electricity bills in excess of £20 that the additional discount takes effect. We could not possibly alter that. We are already allocating £45 million to the scheme as a whole.
    Mr. Gordon Wilson: Will the Minister undertake to have discussions with the Fuel Poverty Forum and other bodies which have strongly commented on the availability of the scheme as it affects old people and those who require further heating assistance?
    Dr. Cunningham: Yes, Sir. I recently wrote to David Green, the secretary of one of the groups co-ordinating such work, and offered to meet him and similar groups. I await his reply.

    National Coal Board
    Mr. Hannamasked the Secretary of State for Energy when he last met the chairman of the National Coal Board.
    Mr. Benn: On 31 January I chaired a meeting of the Coal Industry Tripartite Group, at which the chairman of the National Coal Board and the national
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    officers of all the mining unions were present.
    Mr. Hannam: Will the right hon. Gentleman confirm that he fully supports Sir Derek Ezra's statement at the opening of the pay negotiations that moderation in this year's settlement is essential if the long-term investment plans of the coal industry are to be successful?
    Mr. Benn: The negotiations are taking place between NCB and the unions. The tripartite group discussed the future of the industry.
    Mr. Ioan Evans: When my right hon. Friend next meets the chairman, will he discuss with him the conclusions of the tripartite group on the development of the South Wales coalfield, in view of the fact that output and productivity there are rising at a higher rate than in any other coalfield in Great Britain?
    Mr. Benn: I am aware of the importance of South Wales. I have chaired two or three of the four meetings. I hope that we shall complete our studies of the South Wales area shortly. I am hopeful about the outcome.
    Mr. Forman: Will the right hon. Gentleman confirm that at a recent meeting at which the Chief Secretary to the Treasury was present he pressed his right hon. Friend to make it possible for the NCB with the NUM to make a settlement outside the Governmnt guidelines?
    Mr. Benn: I think that the hon. Gentleman is misinformed, because we did not discuss the subject of pay at the tripartite meeting.
    Mr. Woodall: When my right hon. Friend next meets Sir Derek, will he have a word with him about the implementation by the Board of the coal mining subsidence legislation? Is my right hon. Friend aware of the widespread concern in my area about the lack of adequate information on subsidence and, secondly, the lack of consideration in providing adequate compensation for suffering caused by stress and strain?
    Mr. Benn: I shall certainly raise those matters with Sir Derek Ezra.
    Mr. Tom King: Why did the right hon. Gentleman not give a straight answer to

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    my hon. Friend the Member for Exeter (Mr. Hannam)? Does the right hon. Gentleman support Sir Derek Ezra's call for moderation in pay claims if the capital investment programme in the coal industry is to be sustained?
    Mr. Benn: Negotiations are between the Coal Board and the NUM. I certainly will not take advice from the Conservative Party about how to handle the mining industry.

    Energy Industries (State Control)
    Mr. Adleyasked the Secretary of State for Energy if he has any plans to increase State control of the energy industries.
    Mr. Benn: A number of the proposals in the White Paper "The Nationalised Industries", (Cmnd. 7131), which dealt with relations with, and control over, the nationalised industries, are being pursued in the energy sector. In addition, the House is aware of the Government proposal for legislation to reorganise the electricity supply industry in England and Wales. Otherwise, I have at present no plans to enact new controls over the energy industries.
    Mr. Adley: That last statement will no doubt be welcomed, but does the right hon. Gentleman agree that in the post-Iranian situation, if I may so describe it, it is important that we do our best to encourage the greatest possible investment, particularly in the oil industry? Does he agree also that, in view of the lessening interest of both Esso and Shell, this might be the time for a little less stick and a little more carrot to encourage investment from the multi-national and private enterprise sectors?
    Mr. Benn: The last round of licences was a great success. I have been guided in my approach by the lead given by Winston Churchill in 1914 when he nationalised the Anglo-Persian Petroleum Company. That was the best public investment that there has ever been. Undoubtedly, the growing public control over the North Sea is the real answer to the uncertainty in the supply of oil world wide.
    Mr. Hardy: I welcome my right hon. Friend's concern to maintain a sensible
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    and amicable relationship with the energy industry. Does he think it reasonable that this House, in view of the most severe weather that this country has experienced for a generation, should offer commendation on the fact that the industry has served the nation particularly well?
    Mr. Benn: I agree with that entirely. Not only has the industry served the country well, but, as we look around the world and see the great uncertainty in parts of the world from which we have drawn oil supplies, we can only conclude that it becomes even more necessary to preserve, develop and expand our indigenous resources.
    Mr. Viggers: Is the right hon. Gentleman aware that one of the industries for which he is responsible is that covered by the NCB? How can he turn his back on discussions between the Board and the mineworkers' leaders, when he must stand behind the Board's chairman unless his absence of support will undermine the negotiations altogether?
    Mr. Benn: Not only have I not turned my back on the discussions, but last week I chaired a meeting—a meeting which is due to be resumed next week—about the future of the mining industry. That is the proper way for a Minister to act. I am not prepared to negotiate with the NUM, which is a task placed by Parliament on the shoulders of the NCB.
    Mr. Stoddart: What are the latest prospects for the introduction of an electricity Bill this Session?
    Mr. Benn: I have been engaged in discussions to see whether I could find a basis for agreement with the Opposition to make such a Bill possible. Those discussions have been taking place for some time. I am in correspondence with the Opposition Front Bench, and I hope that we shall make progress.
    Mr. Gray: With regard to State ownership in certain areas, does the right hon. Gentleman endorse the recent comment by Lord Kearton that the national oil account is unnecessary and should be done away with?
    Mr. Benn: The national oil account was set up by Parliament. I am strongly in favour of chairmen of nationalised

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    industries expressing their views, but I am not of the opinion that they should determine what is in the national interest. The House of Commons should stand by the decision which it took on the advice of the present Government, and myself as Secretary of State.
    Mr. Heffer: Is my right hon. Friend aware that many Labour Members—indeed, I hope all—will warmly welcome the statement that it is not his job to negotiate with the NUM and the NCB? Too many Ministers in the past have made statements on wages matters which they should not have made. Is he also aware that many of us would regard the so-called post-Iranian situation mentioned by the hon. Member for Christchurch and Lymington (Mr. Adley) as precisely the reason why we should have control of our own energy resources and not allow them to get into other hands?
    Mr. Benn: I agree very strongly with my hon. Friend the Member for Liverpool, Walton (Mr. Heffer) on that latter point. The Conservative Party introduced the Fuel and Electricity (Control) Act, which gave it total power over all the energy industries at the time of the OPEC price increase of 1973. We have introduced the Energy Act, and public ownership of our own resources is the best guarantee that we shall have access to them during periods of world emergency.

    Energy (Alternative Sources)
    Mr. Knoxasked the Secretary of State for Energy what discussions he has had with the European Commission regarding alternative sources of energy.
    Mr. Benn: The Commission participates in discussions in Council when its proposals are considered by my European colleagues and myself.
    The Council of Ministers last December discussed support for projects to exploit alternative energy sources under the regulation which it had agreed in June. We were not able to reach agreement on the additional measures which are necessary before such support can be made available. The Council has yet to discuss the Commission's latest proposals for research and development of alternative energy sources.
    Mr. Knox: Will the Secretary of State say when the Council intends to discuss
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    this matter and reach a decision? Does he agree that, in view of the inadequate size of the programme in terms of research into alternative energy sources, it would be much better to pool our resources on an EEC basis?
    Mr. Benn: I do not agree that our programmes are inadequate. The United Kingdom will spend £15·7 million over the next three or four years. The Community is spending only 59 million units of account, which is not much more, for the whole of the Community. I believe that it is important to go for what is cost-effective. I was somewhat surprised to hear, at the last Council of Ministers meeting, that the programme we were then discussing was recommended on the ground that it was easier to get money out of the Community than from national Governments. My opinion is that one should be cost-effective whether one is doing it at home or in conjunction with others. When the scheme is properly worked out and presented, I am sure that it will be agreed by the Council.
    Mr. William Hamilton: Does my right hon. Friend consider that alternative sources of energy are likely to be sufficiently substantial to warrant a decrease in the provision for nuclear fuel, either in Europe or in the United Kingdom?
    Mr. Benn: It is difficult to say. Nuclear fuel is, in part, competing with oil, gas and coal as well as alternative sources and conservation. At the moment the estimate is that alternative sources of fuel will give us only about 10 million tonnes of coal equivalent by the year 2000. It may be that one or other of the areas on which we are now working will become more promising and permit of more development, and that might be able to carry our electricity-bearing load.
    Mr. Grimond: Do I understand from the Secretary of State's previous answer that our programme of investigation into alternative sources of energy is entirely separate from the European programme and that it does not contribute towards what we are doing? May I ask whether we contribute towards the European programme and what benefit we have had from that programme so far?
    Mr. Benn: There are various levels. There is the national programme, which every country has, the EEC programme

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    and the International Energy Agency programme—the fluidised bed burning at Grimethorpe, for example, which is financed not by the EEC but by the IEA. We should pursue matters of alternative energy whenever we get the opportunity, but we must not assume that everything that is more expensive and done internationally is necessarily better than working within our own resources where, as in the case of alternative energy, climatic and other conditions vary according to the country concerned.

    Offshore Operators' Association
    Mr. Viggersasked the Secretary of State for Energy when he last met the director-general of the United Kingdom Offshore Operators' Association.
    Dr. Mabon: My right hon. Friend last met the director-general of the UKOOA on 1 December 1978 at the meeting of the Energy Commission. I last met him on 19 and again on 20 January.
    Mr. Viggers: When will the Government respond to the United Kingdom Offshore Operators' Association's survey of the North Sea which showed a drop in confidence by exploration companies? Would it help for the Government to give a long-term statement, rather on the lines of the so-called Varley assurances of 1974?
    Dr. Mabon: I hope that we shall do that very soon. We are in the process of doing it. I think that the hon. Gentleman's suggestion is helpful. The decline has levelled off. The idea that the changes in exploration were due to the PRT announcements is totally unfounded, since, in time, this is not entirely true. Unfortunately, part of the submission of the UKOOA is that that is the case. I suggest to hon. Gentlemen that they should look for reasons other than those asserted by the UKOOA.

    Coal (Exploration)
    Mr. Patrick McNair-Wilsonasked the Secretary of State for Energy if he is satisfied with the current level of coal exploration.
    The Under-Secretary of State for Energy (Mr. Alex Eadie): Yes, Sir. The National Coal Board's exploration programme under Plan for Coal has proved
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    very successful and is continuing at an intensive level.
    Mr. McNair-Wilson: In view of the large sums of money involved, would the Government be prepared to invite private industry to participate with the National Coal Board, in developing these resources, either on an exclusive or a joint-venture basis?
    Mr. Eadie: No, Sir.
    Mr. Edwin Wainwright: Will my hon. Friend bear in mind that we must never allow private industry to get hold of the best coal seams? As the nation is short of anthracite for domestic purposes, what is he doing to obtain more anthracite so that we can cater for this country's market without importing from abroad—for instance, from Spain?
    Mr. Eadie: My hon. Friend will recall that the National Coal Board has been developing new anthracite capacity. The Bettes colliery in South Wales will come into production soon and when it does it will mean that there will be less need to import anthracite.

    Energy Supplies
    Mr. Greville Jannerasked the Secretary of State for Energy whether he is satisfied with current supplies of energy for industry.
    Dr. Cunningham: Yes, Sir.
    Mr. Janner: To what extent is the United Kingdom self-sufficient in oil? When does my hon. Friend expect us to be totally self-sufficient and not dependent on supplies from Iran or elsewhere overseas?
    Dr. Cunningham-: We produced approximately 60 million tonnes of oil last year. That is approximately half to two-thirds of our requirement. We expect to be self-sufficient in oil by 1980. We are already self-sufficient in coal and natural gas and as we have good nuclear technology the Government's policies will bring this country to a unique position in energy self-sufficiency—something which is the envy of other Western industrial nations.
    Sir Bernard Braine: Is the hon. Gentleman aware of the unique situation confronting my constituents? They alone in the Kingdom face an unacceptably high

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    risk from the concentration of gas, chemical and oil storage. Is he also aware that they are anxious to know what consideration is being given by the Government to ceasing the importation of liquefied gases into this dangerous and vulnerable area?
    Dr. Cunningham: Yes. I shall draw the hon. Gentleman's remarks to the attention of my right hon. Friend the Secretary of State for the Environment.
    Sir Bernard Braine: Do it now.
    Mr. Gwilym Roberts: Does my hon. Friend agree that industry is only at the beginning of its energy-saving programme? Will he encourage industry to look further at methods of energy saving which could drastically change the situation over the next two or three decades?
    Dr. Cunningham: Yes. We are aware that there is great potential for further increases in energy conservation. It is interesting to note in that respect that our recent energy conservation scheme, sponsored by the Department of Industry, has attracted more than 10,000 inquiries from British industry.
    Mr. Rost: If the Minister is confident that supplies of oil will be satisfactory, despite cut-backs from Iran, can he estimate what effect any increased price of fuel oil will have on industry?
    Dr. Cunningham: It is very difficult to make such estimates, as the hon. Member knows. I cannot hazard guesses as to what the outcome of the Iranian situation is likely to be. I am afraid that I cannot give an answer to that question at present.

    Energy Policy
    Mr. Hooleyasked the Secretary of State for Energy if he will invite the Energy Commission to work out in detail a low energy strategy for the United Kingdom.
    Mr. Litterickasked the Secretary of State for Energy what is his Department's estimate of the energy requirements of the British economy in 1990 and 2000, respectively; and what are the basic assumptions underlying those estimates.
    Mr. Benn: Estimates of United Kingdom energy requirements to the end of the century were presented to Parlia-
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    ment in last year's Green Paper on energy policy. The Energy Commission will be discussing my Department's latest forecasts at its next meeting. I intend that it should consider low energy strategies, which are also currently the subject of a special study by the energy technology support unit.
    Mr. Hooley: Does my right hon. Friend agree that steady economic growth can be sustained with static or even diminishing energy consumption, given sensible technology? Will he discourage the Central Electricity Generating Board from a continuing programme of massive two gigawatt power stations, which are likely to be superfluous over the next decade?
    Mr. Benn: My hon. Friend is right in saying that forecasts are the basis of all energy policy. That is why we are having a special meeting of the Commission to look at forecasts. However, we must be sure that the necessary energy is available, and theoretical models of very low energy consumption would have to be tested against the likely outcome by those who have experience of the matter. I am pleased that forecasts have now moved into the centre of public discussion about energy policy.
    Mr. Litterick: Has my right hon. Friend read the report of the International Institute for Environment and Development, which, based on assumptions of a 2 per cent. to 2½ per cent. economic growth rate during the next 20 years, arrives at the conclusion that, using existing energy conservation techniques, the United Kingdom's economy could be consuming the 1 million tonne equivalent of about 130 million tonnes less than the existing energy consumption projection? Can my right hon. Friend enlighten us on the colossal difference between the two estimates of which we now know, this one and that of his own Department?
    Mr. Benn: I think that what my hon. Friend says about the importance of studying the low energy strategy is right. We are not only funding our own work on it, but Dr. Leach's work and that of his colleagues is of great interest. We must be sure before we build upon a low energy forecast, because it may be based upon certain assumptions which are themselves not sustainable, and we must also

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    be careful that we do not look to a continuing slump to solve our energy problems. We must have a proper rate of growth for sustaining our economy.
    Having said all that, however, I am strongly in favour of this work being done. I should like to see more funding done by my Department of alternative strategies and policies, so that we can test them in the general crucible of discussion.
    Mr. Dykes: At the blunt end of the energy-saving problem, is the Secretary of State satisfied that enough is still being done in large buildings, both public and private, to save on heating costs, particularly now, since we appear, at least for the moment, to have passed the very cold spell of weather?
    Mr. Benn: That matter is for the Department of the Environment and not for me. However, I ask the House to consider that conservation takes some time to develop. I ask the House to remember the clean air legislation. If I remember the figures correctly, £70 million spent over 10 years gave us 70 per cent. more sunshine. While that was happening a lot of people thought that nothing was happening, but then they realised that something was happening.
    Conservation is of that order of a programme. I am very keen that we should pursue it, because it has a lot to offer. We have already allowed, I think, for 100 million tonnes of coal equivalent in savings by the year 2000 from conservation measures already undertaken.
    Mr. Madden: Does my right hon. Friend remember outlining important areas of British energy policy where the European Commission was seeking to interfere? Has that desire to interfere quickened or lessened over recent months?
    Mr. Benn: There are six areas in which three Commissioners are bringing their influence to bear on me. One is interest-relief grants; another is full and fair opportunity; another is the landing of gas; another is the landing of oil; and there are two others in the nuclear field. I have made clear in Brussels and elsewhere that I do not think that a European energy policy would be acceptable if it involved seeking to replace the control of Ministers accountable to Parlia-
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    ments in any of the member States concerned.
    Mr. Adley: I note the right hon. Gentleman's continuing hostility to the EEC. However, does he agree that, on the question of pollution, particularly oil pollution, there is a great deal to be said for working as closely as possible with our Community partners? Will the right hon. Gentleman assure the House that he personally is taking an interest in this matter and is co-ordinating the activities on pollution control not only with our EEC partners but with his ministerial colleagues?
    Mr. Benn: I hope that the hon. Gentleman's skilled mind has not somehow associated a defence of our national interests in energy with a preference for polluting the atmosphere by oil-fired power stations, because were he to do so he really would be exaggerating. Of course I am in favour of international agreement on pollution. Indeed, I have recently made it clear that I would not accept an oil-fired power station at Insworke Point. However, I hope that the Conservative Party would give support to any British Government who were trying to see that the House of Commons retained ultimate responsibility in these major areas.
    Mr. Palmer: Does my right hon. Friend agree that whether the energy strategy be high, low or just evangelical, the key to the situation is a rational pricing policy, which is what is lacking?
    Mr. Benn: I agree with my hon. Friend about pricing policy. He has often stressed this. But I think he will recognise that what he is urging is entirely incompatible with the other argument that is often urged, which is that Ministers should not interfere with the policies of nationalised industries. Both cannot be right—that each industry operates entirely as if it were privately owned, as some urge, and, at the same time, that I should be regularly urged to introduce a thermal parity pricing for energy, or whatever may be right. We must work steadily towards this. That is what the Energy Commission is doing and will continue to do.
    Mr. Tom King: May I say how much we on the Conservative Benches welcome

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    the Secretary of State's rather latter-day conversion to the importance of conservation? If he is to continue his interest in this matter, will he lend his authority to trying to resolve some of the interdepartmental rows in the Government, and will he tell the House when he can get some agreement on improved regulations for building standards and on the question of appliance energy efficiency labelling?
    Mr. Benn: I have announced the biggest programme in the whole of the EEC on energy conservation. I remind the House that the Conservative Party's plan for energy conservation was limited to the advice that we should brush our teeth in the dark.

    Atomic Energy Research Establishment Harwell
    Mr. Rookerasked the Secretary of State for Energy if he is satisfied with arrangements for industrial sponsorship of research at the United Kingdom Atomic Energy Research Establishment, Harwell.
    Mr. Eadie: The day-to-day management of this research is primarily a matter for the United Kingdom Atomic Energy Authority, but my understanding is that it is conducted on a sound basis and that Harwell has a reputation for the quality of its work.
    Mr. Rooker: Is my hon. Friend aware that the latest report from the environmental and medical science division at Harwell on lead pollution concerns research at the London Westway wholly funded, 100 per cent., by Octel Limited, and that no mention of that is made on the face of the report? The report is now being used to intimidate three London parents to stop a court action against Octel Limited. Will my hon. Friend give instructions to Harwell that all reports that are funded by industry should clearly state that that is the case, so that people do not gain a false impression that it is public money that has gone into the production of such reports, which are then used for these very dubious purposes?
    Mr. Eadie: On the latter point, any work done by the AEA is not paid for out of the nuclear Vote. The Authority is self-financing and its full costs, includ-
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    ing overheads, are borne by the bodies which sponsor it. The reason why they ask Harwell to do such things is the high reputation and integrity that Harwell has in dealing with these reports.
    I have no information of the details mentioned by my hon. Friend in regard to the families. With regard to the two reports, it is the intention to publish one, and the other will be available shortly from Harwell. A copy will be laid in the Library of the House.

    Euratom Treaty
    Mr. Stoddartasked the Secretary of State for Energy if he is now in a position to make a further statement as to the implications of the ruling of the Court of Justice of the European Communities dated 14 November 1978 in respect of article 103 of the European Atomic Energy Community Treaty.
    Mr. Spearingasked the Secretary of State for Energy what cases are pending at the Court of the European Economic Community concerning the Euratom Treaty; and what significance they have for the control of atomic material and energy in the United Kingdom.
    Mr. Benn: To the best of my knowledge, there are no cases pending at the European Court concerning the Euratom Treaty. A ruling concerning Community participation in the draft IAEA Convention on physical protection was handed down on 14 November 1978. We are still considering its implications, and I am not at present in a position to make a formal statement about it.
    Mr. Stoddart: I hope that my right hon. Friend will shortly be in a position to make such a statement, because there is considerable concern, certainly on the Labour Benches, that this ruling, handed down on 14 November, has serious implications for the ownership and control of our nuclear energy and, indeed, of our nuclear supplies. When can we expect the Government to have completed their consideration of this far-reaching ruling?
    Mr. Benn: The Law Officers will have to consider the far-reaching nature of that ruling. My anxiety is that the Euratom Treaty could be interpreted in such a way as to say that all special fissile materials were the property of the Euratom Agency. If that were held to be the case—and we

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    shall have to wait for the Law Officers to say what the meaning of it is—that would have very serious consequences indeed. I have seen Dr. Brunner and explained that some of his interpretations of chapter 6 of the Euratom Treaty are wholly unrealistic.
    Mr. Hooley: Does my right hon. Friend agree, however, that not only is the question of the ownership of the fissile material called into question by this ruling, but that responsibility for security and policing of nuclear installations would apparently be transferred to Brussels and away from the control of this country? This ruling is quite fantastic in its implications if it is construed literally.
    Mr. Benn: The immediate meaning of the ruling is that member States are not permitted to participate, unless the Commission or the Community itself does, in the physical protection of nuclear materials. But I do not have to tell the House that any interference with the responsibility of member States for the safety or ownership of certain nuclear materials would be very serious indeed. The Government are watching this with very keen interest.

    National Nuclear Corporation
    Mr. Macfarlaneasked the Secretary of State for Energy whether he will now make a statement on the Government's intentions with respect to the National Nuclear Corporation.
    Mr. Palmerasked the Secretary of State for Energy when he hopes to make a statement on the reoganisation of the National Nuclear Corporation and associated design and manufacturing enterprises.
    Mr. Benn: I am still having discussions with the parties involved and am not yet in a position to make a formal statement.
    Mr. Macfarlane: Is the right hon. Gentleman aware that this vacillation, probably on his part, is doing nothing to assist the British nuclear industry, either domestically or overseas? What can he tell the House today about the timing of the future programme? How much pressure can he bring to bear upon these organisations to present their plans, because, as he will understand, the industry is faced with a series of problems if he does not act positively?
    Mr. Benn: I never thought that I would live to hear the Conservative Opposition demand that I should take firm action against the interlocking private shareholdings imposed on the industry by the Conservative Government and which I am trying to unravel. The arrangements made by the Conservative Government were quite unsatisfactory, and I am seeking to proceed by agreement. That is why the process is taking a bit of time. It requires agreement, unless the House is ready to legislate. All I can say is that those groups in the industry, both at Risley and Whetstone, whose views have been taken on the matter formally, are of the view, right up to the highest management level, that a majority holding in the public sector would be the best way to support the NNC.
    Mr. Palmer: Does my right hon. Friend agree that Sir Arnold Weinstock, head of GEC—certainly the man with the greatest power there—is laying down certain demands for the restructuring of the industry? Will my right hon. Friend give an assurance that the Government will make these decisions, and not Sir Arnold Weinstock?
    Mr. Benn: I do not think that it would be fair to reveal in the House discussions that I am having with Sir Arnold Weinstock, who was left, under the arrangements reached by the Conservative Government, with a command ownership role in the industry. I have enjoyed useful discussions with Sir Arnold on this matter, and I am of the view that a decision of this magnitude must be made by the Government. But in the absence of legislative power I have to seek to proceed by agreement, and that is what I am trying to do.
    Mr. Tom King: Quite apart from the role of private sector companies in this matter, have the right hon. Gentleman's proposals had the full support of all the nationalised industries concerned?
    Mr. Benn: I am involved in discussion with the Central Electricity Generating Board and the Atomic Energy Authority. I am trying to reach a consensus, because that is the proper way to proceed. I have no legislative power to operate differently from that. This is a very important industry, and the way in which it has been structured leaves the

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    Government very little scope except to proceed by discussion and agreement. I do not regret that—unless I am criticised for taking a long time to seek an agreement.

    Electricity Council
    Mr. Rostasked the Secretary of State for Energy when he last met the chairman of the Electricity Council.
    Mr. Benn: I keep in close touch with the chairman of the Electricity Council, and saw him last in November.
    Mr. Rost: As there is increasing evidence that electricity is pricing itself out of the energy market because it converts its fuel so wastefully, will the right hon. Gentleman, when he next meets the Electricity Council, explain how the consumer will react to the further increase in electricity prices which must come, particularly if he does not support the chairman of the National Coal Board in the forthcoming wage negotiations?
    Mr. Benn: The hon. Gentleman is a keen supporter of combined heat and power, and so am I. But he will also recognise that where there is a big capital investment in a particular series of large power stations it is not possible to shift overnight from a low percentage utilisation of primary fuel to the high percentage that combined heat and power would provide. I have made it clear on a number of occasions that I and many other people have grave doubts about the early 1960s policy decision that the only thing to go for is massive power stations. Such a station is vulnerable. It can go out of action like Abenthaw B, which, I believe, has operated at only about 40 per cent. capacity since it was built, or Hunterston, where technical trouble led to loss of power for a year. I strongly support the hon. Gentleman's advocacy of combined heat and power, provided he recognises that it takes a little time to shift from one strategy to another and that it cannot be done overnight.
    Mr. Stoddart: When my right hon. Friend met the chairman of the Electricity Council, did the chairman tell him of the increasing frustration of the Council that we have not yet got an electricity reorganisation Bill before the House? If my right hon. Friend did hear that from the chairman, will it help him with the
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    discussions now going on, so that we can get a Bill before the House?
    Mr. Benn: I am keen to get a Bill forward, and so is everyone with whom I have discussed it. The trouble is that there is no agreement about what such a Bill should say. Therefore, I am trying, by discussion with the Opposition—and I pay tribute to the hon. Member for Bridgwater (Mr. King) who has been very cordial in the discussions we have had—to reach an agreement that would permit a Bill to get a Second Reading and go into Committee. But I cannot commit the hon. Gentleman, and I cannot even commit myself at this stage. It is our hope, however, that the Bill will proceed, because it is not in the interest of the industry that it should be a political football when what it needs, and has needed for many years, is a basic Act of Parliament giving it the power to reorganise, subject to general parliamentary supervision.
    Mr. Speaker: Before we turn to the questions to the Minister for Overseas Development I should like to express my gratitude to Ministers and hon. Members for their co-operation, because we have heard a lot more questions and answers.

  OVERSEAS DEVELOPMENT

    Lome Convention (STABEX)
    Mr. Hooleyasked the Minister of Overseas Development if Her Majesty's Government are making any firm proposals for the revision of STABEX in the course of the Lome renegotiations now in progress.
    The Parliamentary Secretary to the Ministry of Overseas Development (Mr. John Tomlinson): We have agreed with our Community partners that in the renegotiation of Lome we should generally seek to consolidate the present scheme, and to define more closely its objectives. We have also suggested or supported certain technical changes which are now being considered in the Community before discussion with the ACP.
    Mr. Hooley: Have the Government considered that it might be more advantageous to put influence and money behind the development of the common fund, with possibly the IMF compensatory financing facility, rather than behind

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    STABEX, which is limited both in resources and in scope?
    Mr. Tomlinson: My hon. Friend raises a very important question. Price stabilisation and earnings stabilisation are clearly related, but they serve different purposes. STABEX may be needed by the producers for reasons unconnected with price stability. It is certainly an important element within Lome, but it is geographically restricted, and the matters that my hon. Friend has raised are important. They should be taken into consideration. Indeed they are being given serious thought as being complementary to some of the work being done by STABEX.
    Mr. Tim Renton: Can the hon. Gentleman explain the paradox that both he and the Minister see the importance of STABEX, wish to expend and improve it, recognise the value of the Lome Convention—all of them EEC initiatives—and yet he and she are so anti-Common Market? Are they not in danger of talking with two tongues, both barbed?
    Mr. Tomlinson: That supplementary question reflects the abysmal ignorance of the hon. Gentleman. If he examines the records of those to whom he has referred he will find that their views do not coincide with the views attributed to them. I make no apology for having been a consistent pro-Marketeer, and I support a number of radical changes from our position inside. If the hon. Gentleman is asking whether there is any conflict the answer is "No". We have given our full support to the arrangements being made within the Community for this very important process in developing an outward-looking Community.

    Zambia
    Mr. Donald Stewartasked the Minister of State for Overseas Development if she will seek to deduct funds owing to United Kingdom nationals from financial assistance to Zambia, either by means of an existing Act or by any other method.
    Mr. Luceasked the Minister of Overseas Development whether, in conjunction with the provision of aid to Zambia, there is an understanding that arrears of remittances to British subjects who have served in Zambia will be paid off.
    The Minister of State for Overseas Development (Mrs. Judith Hart): I apologise if this answer is a shade longer than usual, Mr. Speaker.
    British aid to Zambia is designed to help Zambia's foreign exchange resources by enabling her to pay for essential British imports. These and similar measures by other donors and the International Monetary Fund will make it easier for Zambia to release foreign exchange for remittances to British subjects. The Zambian Government have assured us that part of the foreign exchange made available by the advance payment for copper purchases will be used for this purpose, and I understand that the greater part of the recent International Monetary Fund credits has been used to clear remittance arrears to British firms and individuals. It is not possible to deduct the money owed to United Kingdom nationals, from British aid loans to Zambia, because the money has been voted by Parliament to assist Zambia's economic and social development and cannot be used for other purposes.
    Mr. Stewart: Is the Minister aware that my constituent, a nurse who was in Zambia, is now confined to her wheelchair for the rest of her life and is expected to wait for up to eight years for full payment of the compensation awarded to her against the nationalised insurance industry in Zambia? Is she aware that similar cases have been made known to me from throughout the United Kingdom? In view of the Minister's statement on assistance to Zambia, will she take up the matter with the Zambian Embassy here to ensure that it makes prompt payments of these outstanding debts?
    Mrs. Hart: I am aware of and have great sympathy with the right hon. Gentleman's constituent. I am happy to report that £25,000 of what she is due has already been remitted and that a further amount of nearly £4,000 has been authorised for payment in view of the especially compassionate nature of this case. The rest—the minimum of the amount—will be remitted at the rate of approximately £1,100 annually. I do everything that I can to persuade the Zambian authorities. In the end, the best hope that we have of getting money to British citizens so affected is by giving

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    the assistance to Zambia that we are giving.
    Mr. Luce: Does the Minister agree that her first duty is to seek to ease the financial hardship of the many thousands of British subjects who contributed their skills to Zambia in the past and who face long delays in obtaining their remittances? I welcome the fact that there is at least an implied understanding between Britain and Zambia and that in the provision of economic assistance to the Zambians the Government will seek to speed up the release of frozen assets. Nevertheless, does the Minister accept that the situation remains serious and that delays are extremely long? Will she give top urgency to holding discussions with the Zambian Government about speeding up the matter?
    Mrs. Hart: We shall certainly do that. The hon. Gentleman may be in no doubt about that. The difficulty is that the only way that the Zambians can do it is on the basis of the free foreign exchange that we provide to them through our aid. We are limited. Both the hon. Gentleman and the right hon. Gentleman will appreciate that we are bound by the Overseas Aid Act which provides aid money through the authority of Parliament for the purpose of promoting the development or maintaining the economy of a country or territory outside the United Kingdom, or the welfare of its people. Some constituents, who have been writing to some hon. Members, have not understood that, and that is understandable. There is nothing that we can do under the Overseas Aid Act to use aid money directly to assist people here. However, we hope that the Zambian Government will use the foreign exchange provided to them through our aid to speed up the payments for some of the considerable cases of hardship that arise.
    Mr. Lee: Does my right hon. Friend agree that however sad some of these cases may be—especially the case quoted by the right hon. Gentleman—the Zambian Government are generally sympathetic and sensitive to these matters? Does she agree that everything possible should be done to sustain and nurture the friendship with the Government of
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    Zambia, one of our best friends in Southern Africa?
    Mrs. Hart: I entirely agree with my hon. Friend. This is exactly the point that I seek to make. The more we can provide assistance to Zambia in this critical economic situation that they face the more the Zambians are likely to be able to provide the compensation—the money —that a number of British citizens feel is due to them.
    Mr. Wiggin: One of my constituents has a claim against the now defunct East African Harbours Board. It is an acknowledged claim, which the Governments concerned refused to pay. In the interests of ensuring that British nationals go to these countries to help and assist—as indeed it is our contribution so to do—can the Government do nothing about these logical claims that are acknowledged?
    Mrs. Hart: No, we cannot do so with those claims. We are making a great many efforts—some of which have been partly successful—to restore the relationship within the East African community, which broke up several years ago. That caused many difficulties for many people. However, we cannot pay anything to these people out of aid funds. We can try to ease and restore some relationships. However, one of the members of the East African community is Uganda. It is very difficult. Nor would I wish to persuade either Tanzania or Kenya to enter into the kind of relationships with Uganda that might resolve all the situations.
    Mr. Ioan Evans: Although sympathising with the individuals affected by the decisions taken by the Government of Zambia, will my right hon. Friend be sympathetic to the Zambian Government because of the financial difficulties they are in as a result of maintaining sanctions against the illegal regime in Rhodesia, which we want to put right?
    Mrs. Hart: That is why we have taken exceptional measures to assist the Government of Zambia. There has been the £20 million copper purchase and the £20 million loan programme arrangements. We are entering into project assistance to Zambia. There is no doubt that the Zambian economy needs every help that we can give it.

    Aid Programme
    Mr. Formanasked the Minister of Overseas Development what action her Department is taking to inform the public about the official aid programme and the purposes which it is intended to serve.
    Mr. Tomlinson: In 1978 over 50 speaking engagements were arranged for my right hon. Friend, myself and officials; 268 press notices and 34 publications were issued; and our paper "Overseas Development" was distributed to over 9,000 regular readers. We are now expanding the readership to 30,000.
    Mr. Forman: Is the Minister aware of the recent study commissioned by his Department into public attitudes on overseas development, which showed that about one in five of the sample had neither heard nor read anything about the conditions in developing countries, and that the levels of wealth in those countries were over-estimated by some three-and-a-half times and that when people were told the true facts the proportion of those opposed to overseas aid reduced dramatically? Will he redouble his efforts to see that the information campaign is more successful?
    Mr. Tomlinson: I thoroughly agree with everything that the hon. Gentleman says. My right hon. Friend commissioned this report. It was published on 29 December 1978. It was placed in the Library of the House of Commons. It would be beneficial for a number of hon. Members to read that report.
    Arising from that report, but not directly to publicise what the Government are doing, which was the hon. Gentleman's question, but to publicise what needs to be done, and to create a public awareness of what needs to be done, we have our new programme of development education which will cost £500,000 this year, rising to £2·7 million by 1982.
    Mr. Hooley: Will the Council for International Development be reconvened, or will it be allowed to wither away?
    Mr. Tomlinson: My hon. Friend will be pleased to know that the Council for International Development exists. Plans are now in hand for its next meeting.
    Mr. Blaker: Will the Secretary of State take an early opportunity to clarify a point which might be useful? In administering the aid programme, does the Department regard it as one of its purposes to assist British exporters, including exporters in the private sector? Is the Department prepared to authorise the expenditure of aid on infrastructure projects where such projects may be critical in securing contracts for British exporters?
    Mr. Tomlinson: Although that supplementary question does not arise directly from the main question, I have no doubt that the hon. Gentleman will go out rejoicing and shouting from the rooftops that the bilateral aid programme of this country results in about £290 million worth of exports from British industry. The most reliable estimate we have is that about 50,000 people in employment in the United Kingdom are working on projects financed exclusively from our aid programme.

    India
    Mr. Greville Jannerasked the Minister of Overseas Development how much aid the United Kingdom has given to India during 1978; and how much it is proposed to give during the year 1979.
    Mrs. Hart: Total expenditure in the calendar year 1978 is provisionally estimated at £117 million. I cannot give a firm estimate for expenditure in 1979, but would expect it to be significantly higher.
    Mr. Janner: Whilst I welcome that reply, will my right hon. Friend also encourage in any way she can the giving of voluntary asistance—for example, by the scheme proposed by the Chief Minister of Gujarat, Mr. Babhubai Patel, for the sponsoring or adoption of villages in India by Asian communities or others in this country anxious to help those who are desperately deprived?
    Mrs. Hart: As my hon. and learned Friend may know, we have our pound for pound scheme. If any community organisation in my hon. and learned Friend's constituency wishes to put forward a proposal whereby my Ministry could provide 50 per cent. of the cost of anything that that organisation might wish to do, it must get in touch with the Ministry. We shall be very glad to help. We now have

    29
    a pretty good aid programme to India, involving mobile health clinics and many things that are relevant to the poorest people in India. We are anxious to help with any voluntary scheme that anyone might propose.
    Mr. Rifkind: Does the Minister recall the strong citicism of the Government's decision to supply ships to India out of the aid budget, a form of aid that has nothing to do with helping the needy in India but is helping to subsidise employment in this country? Is a similar deal presently being arranged with the Government of Pakistan?
    Mrs. Hart: That raises another issue, and no doubt the hon. Gentleman will put a question down to me. There is a certain confusion here. We are talking in our aid strategy about poorest countries and poorest people. India is one of the poorest countries. It also contains many of the poorest people. If one of the development priorities of one of the poorest countries is ships, there is nothing irrational and nothing inconsistent with our aid strategy in providing them. We must distinguish between poorest countries and poorest people and see where they fit together.
    Mr. Clemitson: Can my right hon. Friend explain the reasons for the shortfall in the take-up of aid by India, a shortfall that amounts to about £35 million in the past five years, about half of which has arisen in the past financial year?
    Mrs. Hart: My hon. Friend has written to me about this matter and I am in the course of replying to him. I visited India in July 1977, and my right hon. Friends the Prime Minister and the Secretary of State for Trade visited India a little later. There have been problems. I think that we now have most of them sorted out, and I have every expectation that the aid programme to India will be, if not absolutely fully spent, at least much better spent than in the last years.
    Mr. Luce: The Minister has not answered the question put by my hon. Friend the Member for Edinburgh, Pentlands (Mr. Rifkind). What has the provision of £53 million in aid in the years 1978 and 1979 for the construction of six subsidised cargo ships in Sunderland to
    30
    do with the alleviation of poverty in India?
    Mrs. Hart: I must emphasise that India is one of the poorest countries. One of its problems is a shortage of foreign exchange. If India believes that amongst its development priorities having ships will assist its foreign exchange and resources, there is nothing inconsistent in what we are doing.

INDUSTRIAL SITUATION
Mr. Cormack: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the effects of the current industrial unrest in England, Scotland, Wales and Northern Ireland, and in particular the threats presented to the welfare of hospital patients and the disruption of local authority services."
When I made a similar application last Thursday, Mr. Speaker, you were kind enough to indicate that, if I should repeat the submission today and you felt that the circumstances still warranted it, you would grant a debate.
I do not want to detain the House any longer at this juncture, but I wish to say that I believe that the circumstances still warrant a debate. Perhaps I may give merely one illustration. My right hon. Friend the Member for Stafford and Stone (Mr. Fraser) has just told me that news has come through on the tapes of a funeral party being kept waiting at a cemetery. It cannot go through with the funeral. That one horrible, tragic illustration shows the sort of situation we face.
I urge you, Mr. Speaker, to grant this request.
Mr. Speaker: The hon. Member gave me notice this morning that he would seek leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he believes should have urgent consideration. namely,
"the effects of the current industrial unrest in England, Scotland, Wales and Northern Ireland, and in particular the threats presented to the welfare of hospital patients and the disruption of local authority services."

31
The hon. Member is quite right: on Thursday last, I told the House that I would consider his application today. I listened carefully to what he said, and I am satisfied that the matter raised by the hon. Gentleman is proper to be discussed under Standing Order No. 9. Does the hon. Gentleman have the leave of the House?
The leave of the House having been given, the motion stood over, under Standing Order No. 9 (Adjournment on specific and important matter that should have urgent consideration), until Seven o'clock this evening.

BILL PRESENTED
  LOCAL GOVERNMENT FINANCE
  Mr. Secretary Shore, supported by Mrs. Secretary Williams, Mr. Secretary Varley, Mr. Secretary Millan, Mr. Secretary Morris, Mr. Robert Sheldon and Mr. Guy Barnett, presented a Bill to make further provision in respect of rates and in respect of grants to local authorities or to bodies providing services for local authorities; to amend certain enactments relating to fees charged by local authorities; and for connected purposes: And the same was read the First time; and ordered to be read a Second time tomorrow and to he printed [Bill 68].

  STATUTORY INSTRUMENTS, &c.
  Ordered,
  That the draft Export Guarantees (Extension of Period) Order 1979 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Foot.]

ORDERS OF THE DAY

  VACCINE DAMAGE PAYMENTS BILL
  Order for Second Reading read.
  3.37 p.m.
  The Secretary of State for Social Services (Mr. David Ennals): I beg to move, That the Bill be now read a Second Time.
  The Bill is a quite short and, I very much hope, uncontroversial measure. None the less it is important, since its aim is to provide a measure of financial support to people severely disabled as a result of vaccination, and to their families and others involved in looking after them. There can be no doubt that those concerned pay a high price in terms of personal disablement, often at a very early age before their lives have properly begun, and that their families share in that price.
  For most people, vaccination is a beneficial procedure, and it is right for the community to give financial aid and support to those who suffer as the result of vaccinations given as part of the public policy programme. I am sure that the whole House will support the humane motivation of the Bill.
  Hon. Members will recall that on 14 June 1977 I informed the House that we accepted in principle that there should be a Government scheme of payments in respect of vaccine damage once the Pearson Royal Commission's report was published. It then seemed likely that the Commission would make detailed recommendations which we would need to take account of in designing the scheme.
  The report was published in March last year, and included only a general recommendation about strict liability in tort for vaccine-damaged people. It was immediately clear that the Government would need to give detailed consideration to this and the other Pearson recommendations as a whole, which would inevitably take time, and, in view of the urgent need to assist vaccine-damaged children and those who cared for them, we decided on a scheme to provide payment of a lump sum of £10,000 in respect of those severely damaged by vaccination under a routine public policy vaccination programme.

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  The scheme was outlined in my statement to the House on 9 May 1978, and I gave further details in answer to a question by my hon. Friend the Member for Stoke-onTrent, South (Mr. Ashley) on 2 August last year. In referring to my hon. Friend, I should like to say how much I appreciate, and how much those involved have appreciated, the tremendous interest he has taken in this measure and this cause.
  I said on 2 August that a Bill to cover the scheme could be introduced as soon as parliamentary circumstances permitted, but that in view of the urgency of the need arrangements would be made in advance of legislation to ensure that families who had already waited a long time could make their claims as quickly as possible. In fact, I am glad to be able to tell the House that we shall shortly be making payments in some 50 cases in which we have already notified an award to the claimants.
  There have been some beneficial modifications in the details of the scheme that I outlined on 2 August. In particular, the residence qualification has been abandoned, and there is in the Bill a provision for payment in certain additional cases. It now covers damage suffered by a person as a result of vaccination of the mother before birth, vaccination against polio at any age, and any vaccination to anyone given during an outbreak of the disease in question.
  I want to make it clear that the Government remain convinced of the benefits of routine vaccination as part of the public health programme. The massive overall benefits of immunisation against these diseases far outweigh the associated risks, and we must continue to provide this protection to our children and to the community at large, while providing for the tiny minority who suffer disablement as a result.
  Mr. Jack Ashley (Stoke-on-Trent, South): I am glad that my right hon. Friend has made that point. He knows that those of us who have been active in this matter strongly support the immunisation programme, but we are never reported when we make that point. Will he tell the House that all those who are active in this campaign have strongly supported the immunisation programme?
  Mr. Ennals: I am grateful to my hon. Friend for his intervention. What he has said is absolutely true. The more people recognise the value of the vaccination programme and stand up and say so, as my hon. Friend has done, the better it will be for the public at large as well as for individuals.
  The Bill is designed to provide a lump sum payment now for the support of those severely disabled by vaccination. On the wider issue of the Royal Commission's recommendation about strict liability in tort in respect of vaccine damage, I can only repeat what I said in the debate on the Pearson report on 17 November last, that, in consultation with the medical profession, we are studying this recommendation, and we still have a good deal more work to do. But the House will fully take the point that this Bill does not in any event purport to provide a compensation scheme. It follows that a £10,000 payment is not in any way a bar to any subsequent civil proceedings for compensation, and does not prejudice any rights, though it would be taken into account in assessing the amount of any damages.
  Much the most difficult part of a scheme of the sort which this Bill provides for is the method of determining whether a particular disability can be attributed to vaccination. I think that the House would wish me to explain how we approach this matter. Most of the controversy in this area is in relation to cases of brain damage attributed to vaccination against whooping cough, and it will probably be helpful if I relate my remarks most closely to this situation.
  In fact, there is no medical consensus about whether whooping cough vaccination can produce brain damage. Some experts argue that there is no firm evidence that whooping cough vaccine has ever caused any such damage. Others have argued that in a small but definite proportion of cases such damage occurs in consequence of vaccination. I consulted my expert advisory body on the matter, the Joint Committee on Vaccination and Immunisation, and in May 1977 it provided me with a very thorough review of the evidence. This has since been published. From a retrospective analysis of cases involving conditions such as childhood convulsions or encephalopathy, the committee concluded that it

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  was not possible to differentiate between those cases which were and those which were not apparently caused by vaccination. On the other hand, it recognised that the risk that pertussis vaccine induces reactions, sometimes mild, occasionaly severe, and rarely of an extremely serious character, is not negligible.
  The problem of identifying the vaccine damage cases is, therefore, difficult. If we were to insist on proof, in the legal sense, of such damage, very few, if any, would succeed. What we propose, therefore, is that the test of the balance of probability is to apply—and that is what the Bill provides. This will entail looking at each case as a whole, taking into account the medical history and the current condition of the disabled person.
  In some cases there is a clear record of vaccination, closely followed by febrile convulsions, and evidence of brain damage within a week or so. In such a case, unless there is some compelling evidence of another cause, the claim will clearly be accepted. At the other extreme, there are cases where there is a long gap between vaccination and any symptoms, and where there are grounds for assigning some other cause, for example, a congenital condition. But I emphasise that, while, in the first place, my Department's medical officers are looking at cases on this basis, there is no question of the decision on the issue being made finally in my Department. I am sure that that would be wholly wrong. It is, therefore, a two-stage process. In each case there will be a right to have the case considered by an independent expert tribunal. If, on the balance of probability, the tribunal is satisfied that the conditions in the Bill are met, payments will be made. The same general principles apply to claims in respect of damage due to vaccination from diseases other than whooping cough.
  I now turn to the detailed provisions of the Bill. Clauses 1 and 2 provide for a payment of £10,000 to be made for anyone severely disabled as a result of vaccination under a routine public policy vaccination programme. Generally speaking, a payment can be made only to a person who suffers, or has suffered, 80 per cent. or more disablement caused by vaccination against certain specific diseases which was carried out in the United Kingdom or the Isle of Man after
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  the National Health Service came into existence on 5 July 1948 and before those concerned have themselves reached the age of 18.
  Provision is also made for people who have suffered disablement either because their mothers were vaccinated before they were born or because of the vaccination of someone else with whom they were in close contact. I believe that there will be few such cases. In addition, the Bill covers damage due to vaccination at any age against rubella—German measles—or poliomyelitis. The general age-18 rule reflects the fact that, except for these two diseases, the present routine public policy vaccination scheme is for the vaccination of children.
  The establishment of the extent of disablement will be based on well-established social security principles. By fixing 80 per cent., we have, I believe, brought in all those who are really severely disabled. This will ensure that those who receive mobility allowance or attendance allowance in respect of the disability in question will qualify.
  Clause 3 sets out the prescribed manner for claims to be submitted and determined by the Secretary of State in the first instance. The question whether severe disablement has resulted from vaccination will, as I have already said, be decided on the balance of probability. If a claim is disallowed for any reason, the claimant will be notified as soon as possible, and the reasons for disallowance will be given. Where the claim fails because the disabled person is considered not to be severely disabled as a result of vaccination, the procedure for appeal to an independent medical tribunal will be explained in the notification of disallowance.
  Clause 4 provides for the establishment of independent medical tribunals to review cases referred to them which have been disallowed by the Secretary of State because he is not satisfied that the disabled person is severely disabled as a result of vaccination. The details of the appointment and procedure of these tribunals will be dealt with by regulations, and I must add that the Secretary of State will be bound by the decision of the review tribunals.
  Clause 5 permits the Secretary of State to reconsider a determination made on

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  his behalf because of a change of circumstances since the determination, or because of ignorance or mistake in respect of some material fact at the time of determination.
  Clause 6 sets out the proceedure by which payments will be made either direct to the disabled person, if he is over 18 and capable of managing his own affairs, or, if not, to trustees appointed by the Secretary of State. It is envisaged that these trustees will be those responsible for looking after the disabled person, generally his parents or relatives. The terms of the trust deed will be widely drawn to allow trustees considerable discretion in spending money.
  Mrs. Helene Hayman: I should be grateful if the Secretary of State could clarify a matter which arises on clause 6(4). Let us suppose that civil proceedings are taking place and a person already has the payment. It is conceivable that such a claim could be against a drug manufacturer and not the Government, yet the money paid over by the Government would be taken into account by the courts in assessing damages. What would be the position on the £10,000 between the drug company and the Government?
  Mr. Ennals: I have noted the question, but I shall leave it to my right hon. Friend to answer it later.
  Clause 7 makes it possible for those who have claimed before Royal Assent, and who have not been successful, to take their cases to a tribunal after Royal Assent.
  Clauses 8 to 12 are of a technical nature. They cover the provisions for financing the scheme, for making regulations in respect of procedural details and so on.
  Finally, I should like to remind the House that the payments to be made under the Bill are additional to the wider social security provisions for disabled people—part, indeed, of the continuing programme to improve the lives and prospects of disabled people to which my right hon. Friend the Minister responsible for the disabled devotes all his time and energy. Many of the people being helped from the Bill will already benefit from mobility and attendance allowances.
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  I am sure that I am right in assuming that the Bill has wide support in the House as I know it has in the country as a whole. It may not go as far as some hon. Members would like, but I commend it to the House as an immediate measure. As such it goes a long way towards providing relief and support for those who have suffered the tragic consequences of what for the overwhelming part of the community is a vital life and health-saving programme.
  Mr. Robert Boscawen: I apologise for not being here at the beginning of the debate. Could the Secretary of State state the position on supplementary benefit? Is there any disregard of the total sum of £10,000 as opposed to the capital holding of the individual?
  Mr. Ennals: That is another question that I shall specifically ask my right hon. Friend to deal with. We are trying to complete the debate before seven o'clock and I promised to be brief.
  The Bill seeks to alleviate the cruel paradox that, because the great majority benefit, a minority, albeit a very small minority, has suffered. I feel sure that the House will welcome this humane measure.
  3.53 p.m.
  Dr. Gerard Vaughan: I, too, shall be brief. This is a most important Bill, but the debate is to be short and a number of hon. Members wish to speak.
  There will be satisfaction on both sides of the House that the Bill has come before us today. It is rather pleasing to be able to congratulate the Secretary of State—and I do so now—on having presented the Bill in the way that he has. However much the Bill may mean to us, our satisfaction is nothing compared to that felt by Mrs. Rosemary Fox and the parents who formed the Association of Parents of Vaccine-Damaged Children. They have compaigned magnificently on behalf of their own and other children. Looking back on it, one sees that they had to face difficulties of understanding among members of the medical profession, who consistently said that we were concerned with a small number of children, not perhaps of great social importance. They then had to battle against the views of society. We have been through that un-

  39
  fortunate stage where many parents wrongly assumed that it would be a mistake to have, for example, whooping cough vaccination. There was a panic that led to problems for all kinds of vaccination. These parents then had to battle through the difficulties of persuading this House and the Government.
  This is essentially a matter of personal tragedy, not only for the child who is permanently damaged but also for the parents. I well remember the first time I came across one of these children, who was a bright, vivacious, delightfully normal child before the vaccination but a total vegetable afterwards. These are normal children who end up in a totally damaged condition, and that makes these cases so special. It leads not only to great practical burdens for the family but also to enormous guilt and doubts about whether the child should have had the vaccination. It is a stressful condition, as the House realises.
  I thought at one time that the Government were in danger of brushing the problem aside because the numbers were said to be small. We are now aware that we do not know the total numbers. In many cases it is difficult to know whether to attribute the damage to vaccination or to birth disorders and other conditions. There is still an argument about this. One advantage to emerge has been the setting up of the special inquiry, and we shall in the next year have an answer to two questions—and I hope it will be sooner rather than later. First, we shall have some idea of the numbers involved. Secondly, we shall have a better idea of the efficacy of some of the vaccines, particularly the whooping cough vaccine.
  Once the problem was recognised, the next doubt was one about which I feel strongly. It was whether it was right for society to pick out one group of damaged children, in addition to the thalidomide children, for preferential help over other handicapped children. With the attendance allowance we have to a limited extent achieved help for all handicapped children. We on this side of the House recognise that there are special difficulties about this. The hon. Member for Stoke-on-Trent, South (Mr. Ashley) and the hon. Member for Eccles (Mr. Carter-Jones), who is not in
  40
  the Chamber at the moment, recognised from the start that there were special problems about vaccine-damaged children. Right from the start we on this side have put to the Government that there is a special responsibility on the part of society. A child is vaccinated partly for his own protection but also for the sake of society. We need to ensure that there is an adequate number of immunised children in the community to guard against epidemics. Society has asked for children to be vaccinated and the Government, representing society, have endorsed the procedure. It is therefore right that society should shoulder some of the responsibility when the procedure goes wrong. This has been recognised in other countries, particularly West Germany.
  One argument that we shall wish to consider in Committee is whether £10,000 is the right amount. The amount does not seem much, but the Secretary of State has made it quite clear that it is not intended as compensation; it is simply an interim payment. We have already had representations that, as this is only an interim award, something more should be done for the children rather than leaving it to the parents to go to court, if necessary. I do not know what is the right course. My first reaction was that £10,000 was a good start which showed Government recognition of the problem. For many parents who are in the middle of this tragedy, the fact that society will make a contribution to help them will ease some of their burdens.
  There is one other matter about which I feel very strongly. As a result of the thalidomide tragedy I was asked to set up a panel to examine these children objectively and medically. The message that came out of that was that a great deal of unnecessary suffering was caused by delays in the procedure. Those of us involved with the thalidomide children were anxious that there should be some more rapid procedure for dealing with these cases. The Government have recognised this, and I congratulate them. They have set up a procedure giving the benefit of doubt to the children and avoiding the long and harrowing delays that were experienced by the thalidomide children.
  There are a number of points that we shall want to examine in Committee. We

  41
  have already had representations about the interim payment. There is some difference of opinion on what is happening at present. In his letter to me about the Bill, the Secretary of State said that payments were already under way. However, I had a letter dated 18 January from the Association of Parents of Vaccine-Damaged Children which indicated that no payments had yet been made. We have also had queries about families who were resident in this country—in some cases for many years—but who are now overseas. About half a dozen such families are involved. Will they have a claim on the interim payment? Examples like this need examining in Committee.
  The Opposition have some reservations about the detail, but in general this Bill has their full support.
  4.3 p.m.
  Mr. Jack Ashley: I welcome this Bill, which will ease the burden on families whose lives have been devastated as a result of the vaccination of their children. Happy, healthy children have been blinded, deafened and paralysed or mentally retarded after vaccination. Although they can never be fully recompensed, the parents are grateful to the Government for the interim payment outlined in the Bill.
  The hon. Member for Reading, South (Dr. Vaughan) made some very important points in his speech. I am glad to echo his compliment to Mrs. Rosemary Fox, who, virtually alone, has made the nation, the Government and the whole medical profession aware of what only a handful of specialists knew—that, although the immunisation scheme is invaluable, a tiny minority of children can be damaged by vaccination.
  That fact has been recognised by the introduction of compensation schemes in several other countries such as West Germany, France, Denmark, Switzerland, Sweden and Hungary, but despite this there was a conspiracy of silence in Britain. Successive Governments and the medical profession refused to disclose the risks for fear of frightening people away. But, as the Ombudsman pointed out, people have a right to know, however small the risks are, so that they can then decide for themselves. It is to Mrs. Fox's credit that the Government have not only recognised the fact but have also decided
  42
  to give financial help to the families concerned.
  Equally important is fact that as a result of the campaign doctors are now much more cautious, about vaccine procedures. Vaccinations were being done on the conveyor belt principle and we were given evidence from experts in the field that some doctors were vaccinating when there were contra indications, such as fevers, a history of fits and epilepsy, so that children were being damaged unnecessarily by the negligent use of vaccine. The number of children damaged in this way must have fallen as doctors are now much more careful about the children they vaccinate. This is a valuable and underestimated benefit from the campaign.
  Some people have objected to payments to vaccine-damaged children, and these objectors fall into two categories. The first includes those who deny that vaccination can cause any damage at all, notwithstanding the facts that other countries have these schemes in operation, that the Royal Commission accepted that vaccine-damaged children should be helped and that the Government have accepted the case after careful study. This group includes some of the more eccentric doctors, some of whom have been offensive to the parents concerned.
  The other group opposing payment includes some admirable doctors and sociologists, whose views I respect. They believe that all disabled people should be compensated, irrespective of the cause of their disability. Personally I favour a comprehensive disability income, and in an ideal world all disabled people would be compensated for loss of income and normality and for the costs of disability. In our imperfect world some disabled people get more help than others. The outstanding examples are war disabled and industrially disabled people and those proving negligence in the courts. These are special cases.
  Vaccine-damaged children are also a special case because, like the war disabled, their injuries arise from particular circumstances. Although vaccination benefits the individual, it also benefits the community. In the case of whooping cough, young children are vaccinated only partly for their own benefit. They are vaccinated mainly for society's sake, and especially

  43
  for the sake of siblings. It is because they are wounded in the war against disease, a battle fought behalf of the whole community, that this small group of children should be comp ted.
  However, the Government have now introduced this Bill and I congratulate my right hon. Friend the Secretary of State on bringing it forward. Our clashes in the House have been angry at times, but the House should recognise that the Secretary of State has initiated an important step forward in social policy, and moreover he has done so at a time of very great economic difficulty and in the face of strong opposition from some parts of the medical profession. I recognise the problems and I thank my right hon. Friend most warmly for the way in which he has handled the Bill. It is greatly appreciated.
  Although I welcome the Bill, I want to leave the House in no doubt about my criticisms of it. The Pearson Commission recommended strict liability for vaccine-damaged children. On that principle, the children will receive an average of more than £100,000, and not the £10,000 provided for in the Bill. Under the Commission's recommendation, they would get that sum in a court because they were vaccine-damaged. They would not have to prove negligence.
  The payment of £10,000 is clearly inadequate. It represents only about three years' average earnings and it is to go to children who have been damaged for a lifetime. The Bill can be regarded only as a stopgap interim measure until an adequate compensation scheme is prepared. That should be done as soon as possible. There are various ways of establishing such a scheme, and perhaps the best would be to introduce a system based on the war injuries scheme or a system similar to that for industrial injuries.
  The great advantage of such a scheme, compared with the lump sum given by a court, is that it would be properly inflation-proofed and could be adjusted to any changes in the effect of damage on individuals. I hope that the Minister who is responsible for the disabled will be able to announce categorically that the £10,000 is only an interim payment and is not to
  44
  be regarded as discharging the Government's obligations to vaccine-damaged children and that the Pearson Commission recommendations will be urgently considered by the Government.
  When the payments in the Bill and those under any subsequent scheme have to be implemented, I hope that the Government will give the children the benefit of the doubt. The Secretary of State spoke about the "balance of probability", and that is the right attitude. I hope that that tolerant approach will be consistently maintained. I am sure that the families would appreciate that. I hope that it will be recognised that, in the nature of these cases, direct evidence will be hard to find because when the children were damaged neither doctors nor parents were likely to concentrate on the need for careful documentation.
  I also believe that it is wrong to deny payment to children who are 75 per cent. damaged or even 20 per cent. damaged. Why should they be denied payment? The 80 per cent. condition is rigid and arbitrary and should be removed. I suggest that the Government should think again and bring in a two-tier system, perhaps paying the £10,000 to those children who were more than 80 per cent. damaged and £5,000 for the others. That would be rough justice, but it would be less rough than that which excludes a number of deserving cases.
  I wish to make a plea for the families whose children have died. I know that the payment is not for bereavement, but if a child and his family suffered as a result of the State policy on vaccination a payment should be made. I hope that the Government will reconsider their decision not to pay those families.
  The other category to be considered is the children vaccinated before 1948. I realise that vaccination became State policy in 1948, but some vaccinations, including smallpox, were compulsory before then and I have no doubt that Ministers and doctors recommended vaccination in the interests of the community. I hope that the Government will relent on their hitherto inflexible stand on this aspect. I assume that the trust scheme will be a generous one and that the needs of the family, as well as the needs of the child, will be considered. Indeed, I believe that that is one reason why the

  45
  Secretary of State has hastened this payment to help hard-pressed families.
  Today is an important day for the families of vaccine-damaged children. They have been neglected in the past and vilified for daring to mention the plight of their children in case other children took fright. They have borne heavy financial burdens and, above all, have seen their children condemned to suffer a lifetime of pain and disability and be robbed of the magic of childhood.
  The Government should be congratulated, but they should specify that this is an interim payment and should include all vaccine-damaged children, whenever they were damaged, and help the families of children who have died. If they do all that, they will not only deserve congratulation but will earn the gratitude of a group of people whose years of suffering and frustration have bent and nearly broken them.
  4.16 p.m.
  Mr. Robin Hodgson: When one follows in debate the hon. Member for Stoke-on-Trent, South (Mr. Ashley), who has for so long had such an attentive interest in the problems of vaccine damage, one has obviously been listening to an expert. I listened with a great deal of care and attention to what he said and I echo much of it.
  I welcome the Bill. It is almost impossible to find general grounds for opposing it. It would be like opposing motherhood and apple pie, because no sum of money could possibly compensate the children or the families for the suffering, extra work and psychological hardship that they have undergone and are still undergoing.
  However, I wish to make a number of points on which I hope the Minister who is to reply will comment. I start with two small and specific matters. Clause 2 deals with the conditions of entitlement and subsection (5) provides that the inoculation must have been given within the United Kingdom, except in the case of children of serving members of Her Majesty's Armed Forces.
  I have a constituent who was employed in the Diplomatic Service and the inoculation of his child was carried out by a doctor attached to his embassy. He is not strictly a member of the Armed Forces, but I should be grateful for an
  46
  assurance that that fact will not mean his exclusion from the payment. I am sure that there are only a small number of such cases, but they are a great worry to the parents.
  The second specific point concerns the right of appeal. The Secretary of State said that the decision of the tribunal was final and that there was no right of appeal to him. It was not clear from what he said whether there would be a right of appeal to the courts or whether once the tribunal had given its decision that would be the end of the matter.
  I turn now to the major considerations arising from the Bill. My hon. Friend the Member for Wells (Mr. Boscawen) referred to the question of social security benefits. I know that several of my hon. Friends wish to deal with that matter, so I shall not dwell on it for long except to say that it is a key point. It is extraordinary that the Secretary of State should not be prepared to give an answer now and that he should defer a reply to what is the most critical aspect of today's debate—how the overlap of entitlement to existing social security benefits will be affected.
  Paragraph 182, on page 47, of the Pearson report reads:
  "Sixthly, we have found that even well informed witnesses consistently underestimate the present and prospective value of social security benefits. It is possible for a person with family responsibilities to receive £40 or £50 a week, or more, tax free, by way of sickness or invalidity benefits. … A man totally incapacitated early in life through an accident at work could, by the time he is 65, receive in all a total of £150,000 in benefits at current prices. The payments are 'inflation proofed', and most of them free of tax. Except where particularly high earnings have been lost, the overall value of social security benefits, particularly for industrial injuries, compares favourably with lump sum damages which make no allowance for future inflation."
  Much of what is in that paragraph impinges heavily on what we are talking about today. First, there is the question of the present value of future earnings which Pearson says is £150,000 and which is £10,000 in the Bill. Secondly, there is the question of inflation-proofing and freedom from tax of social security benefits. Thirdly, there is the broad assertion by Pearson that the overall value of social security benefits compares favourably with lump sum damages.
  It is critical that we should have a clear guide early in our deliberations about

  47
  how this payment will fit into the overall scheme.
  Mr. Ennals: The Supplementary Benefits Commission has agreed that if the damaged person is a child it will ignore the £10,000 payment. If the damaged person is an adult, the payment will be taken into account and the Commission will give sympathetic consideration to special circumstances. I am sure that the hon. Member will welcome the decision on children.
  Mr. Hodgson: I am grateful to the Secretary of State for that reassurance.
  I now turn to the question how the Bill fits into the overall scheme. I was glad to hear the Secretary of State refer to the debate on the Pearson report. Much of what he said today seemed to contradict what he said on 17 November. This afternoon he talked about the Bill being a first step—I was delighted to hear that—but in the debate last year he said:
  "it is true to say that there is a general feeling that we may have gone about as far as is sensible in the construction of further individual benefits for particular kinds of disablement, with the range of benefits which now exist."
  This afternoon we seem to be discussing another form of benefit. The right hon. Gentleman went on to say:
  "So what we are talking about is not the bringing into benefit of a class of people who are at present without any cover; what is suggested is the provision of benefit at rates which are higher, sometimes a great deal higher, than are available to ordinary beneficiaries."—[Official Report, 17 November 1978; Vol. 958, c. 773–4.]
  That has a considerable impact on today's discussion.
  Mr. Ennals: In that debate I indicated that I had some sympathy for the idea of a general disability benefit which was linked to the extent rather than the nature of the disability. Clearly such a decision would take a considerable time and, if taken, a considerable time to implement. The whole House feels that we should not delay in dealing with vaccine damage. That is why I feel that we must move ahead regardless of the decision taken on the bigger and more fundamental question of a general disability allowance.
  Mr. Hodgson: I am sure that I speak for many in saying that we are delighted
  48
  to have had the opportunity for debate and that the Government have introduced this Bill.
  We are in danger of setting precedents which will have considerable implications for relative payments for different classes of disabled people.
  I am aware that disabled children have particular clout. They are politically attractive. Other categories of disabled people are less attractive and the wave of public sympathy for them is not so great. I worry in case other less politically, socially and publicly attractive groups of disabled people are left behind.
  An elderly constituent of mine was hit by a vehicle driven by an uninsured driver. She is now severely disadvantaged, through no fault of hers. At her time of life she cannot hope to attract the public sympathy that the hon. Member for Stoke-on-Trent, South is able to arouse on behalf of children. I understand that.
  The Bill is worth while, but I am also anxious about the other groups of people who were discussed in the Pearson report and who might be left behind because they cannot engage public sympathy. I was particularly pleased to note that the Secretary of State said that this was a first step in the setting up of a comprehensive scheme to ensure that disabled people are treated even-handedly, whatever their age, experience or relative disablement.
  4.27 p.m.
  Mr. Hugh Jenkins: I apologise to the Secretary of State for not being here when he opened the debate. But he has made it even by leaving the Chamber now. Perhaps we can call it square.
  The Bill indicates the humane nature of my right hon. Friend and of the Government when dealing with these problems. So much for the hysterical abuse to which my right hon. Friend and the Government have been subjected particularly in such wretched journals as the Daily Mail which are not fit to be put to the basest possible use.
  My hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley) deserves to be congratulated. He has brought to the subject a consistency and determination which deserve our praise. It is recognised that he has for these problems a compassion which is in no way dependent

  49
  upon the fact that he himself suffers from a serious disability.
  I wish to discuss the problems of another category of children, the parents of whom believe them to have been seriously damaged by hormone pregnancy tests. There are many such children. The parents have formed an association to try to achieve similar protection for their children.
  There are psychological pressures upon parents of children who have been damaged as a result of hormone pregnancy tests. I accept that there are arguments against the belief that children can be so damaged, but there is a strong case for believing that they can be and have been. Some people say that the case is not proved, but I urge my right hon. Friend to exercise the compassion which he has brought to the wider problem. I hope that my right hon. Friend will not exclude the possibility of amending the Bill in Committee so as to include this additional category of children and thus prevent them from having to wait for more general legislation.
  The circumstances are similar, but the psychological pressures upon the parents are probably even worse than with vaccine-damaged children. At least the parents have the consolation of knowing, if vaccination goes wrong, that it was being done for the benefit of the child. That is denied the parents of children who may have been damaged as a result of hormone pregnancy testing. The pressures on the parents in these circumstances, while not as gravely distressing as the physical damage suffered by the children, are very serious.
  To include this category in the Bill would be in accordance with the fine attitude that the Government have brought to this problem. If my right hon. Friend could make this exception, he would go even further to bring to the Government the appreciation that is their due under the Bill.
  4.33 p.m.
  Mr. David Crouch: Before I deal with the question of vaccine-damaged children, I should like to echo the words and thoughts of other hon. Members, particularly the Secretary of State, who have expressed great concern for the other groups of childen and adults who have suffered grave physical and
  50
  mental damage from causes other than that of vaccination. It is important that we continue to show our concern for these people by doing something for them along the lines of this generous Bill.
  A constituent came to see me recently. Her husband had survived a car crash which killed two others. He had hitherto been successful, and, although he is not now exactly a vegetable, he is in a psychiatric hospital and is allowed out only occasionally. He can no longer manage his own affairs. His wife is required to devote her whole life to looking after a person who now cannot look after her or their family.
  I cite that example to show that there are others who merit our concern, and serious thought should be given to whether we are providing enough to enable them to shoulder an awful burden that results from a tragedy that has hit them.
  Another constituent came to see me 10 years ago. I was very impressed by the man. He told me that he had a son who was severely handicapped. At that time the boy was about four years old. Since then the constituent has returned to see me regularly. We now know that his son suffered damage from an injection of whooping cough vaccine. My constituent will welcome the Bill and the generous payment of £10,000. However, I think that I should explain to the House a little about my constituent and his family.
  The result of this tragedy was that the father had to give up his job and go on to social security. When one first hears that sort of thing, without knowing the background, one tends to think that the man may have been a malingerer, that he may have been searching for an excuse not to work and to get a generous social security payment. One might ask whether his wife could not look after the seriously disabled child. I have discovered that this man is not a malingerer but is something of a hero.
  The man has had to give up the opportunity of pursuing his career and of providing for his family. He has had to forsake that opportunity of pride and must, instead, seek his pride in looking after his wife and his children who include the severely disabled child. Never once has that man, in all his visits to me, complained about his bad luck and

  51
  the tragedy that overtook his family. He has come to see me only to see whether I can help him to find extra aid, or, perhaps, to find a place in a summer home for two weeks for his son so that the wife and husband can enjoy a two-week rest on holiday at home. He has come in search of the difficult type of medical help that is needed for a severely handicapped person who is now becoming a young teenager but who has to be treated like a baby.
  Members of Parliament are sometimes asked what sort of people come to see them at their interview centres. I say that I see all sorts—those with serious criticisms of Government policy or of the Opposition's attitude or of one's own political views. There are those who come to complain of a Member's failure to support a particular course of action that a constituent thinks merits support. Of course, we get many people with cranky ideas and others with serious personal worries about whether they are getting the right pension or whether they are entitled to some social security allowance or other. But the most distressing cases are those of people who have suffered the sorts of tragedies that I have described this afternoon.
  Those cases set one back and make one feel that, whatever else one does as a Member of Parliament, one should do all one can to help these people who come in desperation. They come not with a begging bowl—that is not their way—but merely to ask for any help we can give to ease their lot. They ask a Member to approach the director of social services to take up their case, or to ask the health visitor or the welfare officer to call.
  In the correspondence concerning this constituent which I have had with the Secretary of State for Social Services and the Minister with responsibility for the disabled, I have received nothing but help. However, I still go home, having seen such a person, with a feeling of not having done enough. I shall go home tonight feeling that not enough is being done in this Bill. I do not want to niggle over the compensation figure, but the hon. Member for Stoke-on-Trent, South (Mr. Ashley) said that £10,000 represented peris probably only two years' earnings the haps three years' earnings. I say that it
  52
  way that things are going. My constituent who had to give up working and devote his life to his family is worth more than two or three years' wages.
  Therefore, I welcome the Bill as an interim measure, as a step in the right direction. But when we hear the claims ringing in the ears of the Government, Parliament and the press for more pay by those who say that increases of 5 per cent., 10 per cent. or even 17 per cent. are not enough, and who take vigorous action to get their way, let us think of the people with whom the Bill is concerned. There may be only a few hundred of them, but they are very important people. If we can do right by them, we will show that we intend to do right by all those others who have suffered. We should remember that these people have made a contribution to the betterment of society; a contribution towards the improvement of health in our society, but, because of the tragedies and mistakes that occur—even though the figure may be one in a million—these people have paid a terrible price—a price on a par with that paid by those severely wounded in war. That price is paid not only by the child as it goes through life without any real enjoyment but by noble parents as well. We must remember them and decide whether £10,000 by way of compensation is sufficient.
  We must also consider whether we are providing enough for other people who have suffered tragedy and who need the right to compensation. I was delighted that the Secretary of State assured the House that the payment of £10,000 would not be taken into account in relation to claims on behalf of children for subsequent social security benefit. As a result, we now know where we stand. When the Secretary of State considers claims under the Bill—I hope that it will soon become an Act—he should remember what my hon. Friend the Member for Reading, South (Dr. Vaughan) said, that he hoped that children would be given the benefit of the doubt over claims for compensation. I hope that there will not be too much haggling over claims. If there is a doubt, the benefit of that doubt should go to the children. I hope that the Government will err on the side of generosity. Even in these hard economic times, the Opposition will support the Government if they do so, and, though I

  53
  do not speak for the Opposition Front Bench, I am sure that I echo its sentiments. I wish the Bill speedy success.
  4.45 p.m.
  Mr. Ronald Atkins: I share the feelings of the hon. Member for Canterbury (Mr. Crouch). I have been impressed by the way in which two victims in my constituency came to see me almost apologetically. They sought help but were not demanding it, though they had a right to demand it. Such people need others to fight their battles for them and I am glad that the compaign was established. It is one of the best of our British traditions that we campaign for the rights of people who do not fight for themselves. This is why the Bill came into being.
  I congratulate my right hon. Friend on introducing the Bill without delay. The making of an interim payment is a good method of dealing with compensation, but I hope that it is definitely an interim payment and that it falls far short of the final payment which we should make to these unfortunate people. They suffer distress through no fault of their own.
  I agree with my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley), who believes that a two-tier system is necessary to cater for those families which would be excluded if there were not such a system. Through no fault of their own, they are in the unfortunate position that the happiness of the whole family is affected. I hope that the Minister will think on the words of my hon. Friend the Member for Stoke-on-Trent, South.
  When a parent agrees to vaccination, he does so, I suppose, by way of his duty as a citizen but also as an act of faith in the medical services, and we can imagine his reaction when he is let down. It is not just a matter of measuring our compassion; it is the granting of a right to compensation for people who have been victims of a system which has not worked properly. I am sure that all hon. Members agree that no amount of money can compensate a family for a disability of this kind. The purpose of the National Health Service is to reduce illness and disability, and when, as a result of the methods used in the medical services, illness or disability is increased, generous compensation naturally has to be paid.
  54
  We may imagine the distress of parents, having consented to vaccination, when great disability is subsequently caused. That distress is all the greater if they do not have the financial means to make up for the suffering caused to the child. We must therefore be generous with compensation. Because of the opposition of my father to vaccination, I have over the years taken particular notice of the use of vaccines and the misuse of drugs. I did not agree with him even though some of his arguments were valid, but I get the impression that many of the tragedies following vaccination could have been avoided if there had been more testing and research before the drugs or vaccines were put on the market.
  There may be too much of a hurry to get drugs on the market. Sometimes this flows from compassion, but at other times it flows from an eagerness to make money, although I appreciate that research costs a great deal of money. The National Health Service, as an enormous consumer and with unified controls, is in a strong position to insist on more safeguards in order to reduce these terrible tragedies.
  Dr. Vaughan: The hon. Gentleman mentioned interim payments. What size of payment does he think would be correct? Since this is a difficult area, should one regard this as compensation or as token recognition of the damage done?
  Mr. Atkins: I regard it first as a right. If one seeks to establish a right, it should be related to the amount of damage done. Secondly, there is the question of compassion. I believe that there should be some kind of assessment panel since we are no longer in such a hurry because interim payments are to be made. Such a panel could assess the needs of those affected and the amount of injury inflicted on the victim. I believe that this is possible, because there are not many people involved.
  Dr. Vaughan: It was said earlier in the debate that the Bill covers children with 80 per cent. damage and upwards. What does the hon. Gentleman feel should be done to deal with children who have a lesser degree of damage? Does he feel that they should be included?
  Mr. Atkins: I said earlier that I supported the views of my hon. Friend the

  55
  Member for Stoke-on-Trent, South on a two-tier system.
  My hon. Friend also mentioned an interim payment of at least £5,000. I, too, was thinking on those lines. I did not want to prolong the debate, but I wholeheartedly supported the views of my hon. Friend. I am glad that the hon. Member for Reading, South (Dr. Vaughan) raised that matter in an intervention, and I am happy to know that there is such united feeling on this subject in all parts of the House.
  4.53 p.m.
  Mr. Robert Boscawen: I wholeheartedly agree with the hon. Member for Preston, North (Mr. Atkins) that no amount of money can undo vaccine damage. I wish to echo the remarks of the hon. Member for Stoke-on-Trent, South (Mr. Ashley), who wishes to see prevention rather than cure. I hope that the House will do all it can to prevent this kind of damage, even though it may happen only rarely. Such a course of action is far better than having to discuss compensation after damage has been done. Society, the family concerned and, of course, the child affected all will be thankful if such tragedies can be averted in future.
  We owe a debt of gratitude to Mrs. Fox of the Association of Parents of Vaccine-Damaged Children. I wish to pay full credit to her for the work she has done, and certainly for the way she has brought these matters to the attention of hon. Members in voluminous correspondence. We have all been well served by the many individuals who have done an excellent job on a voluntary basis.
  Two of these cases occurred in my constituency. One case resulted from whooping cough immunisation, and the other was a more difficult case involving a child who was damaged following inoculation for yellow fever or cholera. The child's parents had the child immunised following the taking up of an appointment with a foreign Government. I understand that the inoculation was carried out by a foreign airline. That was a difficult type of case, and I hope that that and other matters will be pursued in Committee to discover whether compensation is payable.
  Next to the child, it is the parents who are most deeply affected by the terrible
  56
  trauma that occurs when it is discovered that a child's brain has been damaged. That trauma does occur and is that much worse because of the voluntary nature of the decision by the parents in agreeing to vaccination. I know from my contacts with a family so affected in my constituency that the effect was devastating. Difficulty arose when relatives almost blamed the mother for allowing the child to be vaccinated and thus for allegedly causing the damage.
  I am wholly in favour of making the £10,000 payment rather than that there should be a weekly benefit in the form of invalidity allowance, or whatever disablement benefit is due. The payment of £10,000 at an early stage is a special, one-off payment and can be easily understood. It is some small compensation to the parents, particularly the mother, that the trauma has been recognised by society.
  This Bill deals with interim payments, but we must look to the future. Where do we go from here? Shall we go for a larger compensatory payment, or shall we take up the interesting suggestions put forward in correspondence by Mrs. Fox? She believes that there should be a lump sum payment to cater for the early years of the child, particularly in the expensive items of education, clothing and transport to special schools. The cost of transport can be particularly difficult for families who find themselves in this predicament.
  We must consider whether we should provide that kind of assistance in the early years, followed by a benefit such as suggested by Mrs. Fox, namely, a war pension type of benefit, presumably based on percentages. That is an interesting suggestion which should be examined in Committee so that the Government's view can be canvassed.
  Furthermore, we must not ignore the position of the family fund. The Minister with responsibility for the disabled—and I congratulate him on his Privy Councillorship—may be able to say a few words about the future of that fund. I believe that it can be used for post-natally brain-damaged children as well as for children who are damaged pre-natally.
  The family fund will help some of the children who do not quite qualify for the 80 per cent. compensation. There

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  are always difficult borderline individuals who do not qualify for the full payment for one reason or another. The family fund, which is not subject to all the rigidities of other State benefits, could be useful in the difficult situation where a child has not quite fallen within the category which vaccine damage compensation will benefit.
  We are beginning to meet the problem of post-natal and pre-natal brain-damaged children, but there is a long way to go. By no means have we got all the answers yet. The Bill is a beginning. I welcome the fact that we are progressing, but I should also welcome a great deal more thought, both inside the House and outside, on where we go from here.
  5.1 p.m.
  Mrs. Helene Hayman: I support this Bill, as every other speaker has done. I do not think than anyone can be anything but grateful to the Government for having acknowledged the need of this particular group of children. The acknowledgment of their need is particularly important to the families concerned, for reasons mentioned by other hon. Members this afternoon.
  A large amount of personal guilt is felt—however wrongly—by the parents who are involved. They feel that they were, somehow, the agent in the process that has resulted in their children being handicapped by their decision to go ahead with vaccination. It is very fitting that through this Bill we should recognise how much we as a society share that responsibility with those parents because of the public policy of an immunisation programme.
  I do not want to undermine the general immunisation programme that has undoubtedly brought enormous benefit to the health of children and adults in this country. However, it would be wrong for us to pretend that decisions do not have to be made by individual parents when they are considering whether to go ahead with vaccination.
  What we must learn from the drop in the number of immunisations under the immunisation programme for diseases other than whooping cough, following the scare which resulted in the linking of whooping cough vaccine with brain damage, is that it is not enough for us
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  simply to say that immunisation is a good thing and, therefore, that parents ought to go ahead with it without giving those parents detailed information on which to base their decisions.
  We know that there is more risk from some vaccines than from others. We know that parents who have concern about whooping cough vaccination should not be deterred from other vaccinations available, as they are at the moment, because they see all vaccinations under a blanket heading. We know also that some children are more at risk than others. That sort of information must be made available to parents when they are making a decision. It is not enough for us to pontificate on the overall value to society of an immunisation programme without accepting that individuals within society must make their own decisions and that they ought to make them based on the best possible information available.
  Within that context, it is fitting that we have singled out this group of children for assistance. The hon. Member for Wells (Mr. Boscawen), when talking about brain damage, referred to circumstances in which children can be brain-damaged other than those covered narrowly by this Bill. There are other vaccinations and immunisations which can have tragic consequences. There are other aspects of pre-natal care and neo-natal care which can, unfortunately, result in far greater numbers of brain-damaged children. Prevention is far better in all these cases than £10,000 or £100,000 after the damage has been done.
  In addition to the present immunisation programme and this Bill, I think that we must look at other measures—expensive and important measures—that can be introduced in our maternity services, the neo-natal services, the general educational programme on planning for parenthood, and the training of people on the needs of women during pregnancy and the needs of very young children in order to prevent handicap of this kind.
  In this Bill we deal with a very narrow group of children but a group of children that I think we can justify picking out for special attention because of the State's involvement in the immunisation programme. However, once one starts picking out groups of children, one inevitably brings in other groups whose needs

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  must be compared. One brain-damaged child looks very like another brain-damaged child to the parents involved, particularly when there has been some intervention through a medical process in which the State has been involved through the National Health Service.
  Only today I had a letter from a constituent whose child is, she believes, brain-damaged because of the use of a hormone pregnancy testing drug during pregnancy. That is another group. Although we can say that the vaccination programme is different, in terms of public policy, from the administration of a hormone pregnancy testing drug, it is a very difficult line to justify in the case of two families who face much the same problem.
  I am not a doctor and I speak from relative ignorance, but we must look at the whole issue of the administration of an influenza vaccine to a pregnant woman, as we looked at the administration of the rubella vaccine to pregnant women.
  An even greater group which inevitably will use this Bill as an example are women who have suffered thrombosis, or other health hazards, from the use of the contraceptive pill. I agree that it does not come within the vaccination programme, but we have a family planning programme. There is certainly a policy of encouraging people to plan their families. Free contraceptives are available through the National Health Service. Women have suffered death and disablement because of the use of the contraceptive pill.
  At present the Bill is narrowly drawn. I think that that is right. It is an important start for the families concerned. However, an enormous number of adults and children are in some way damaged and equally in need of the kind of help which will be given to these children. This measure, important though it is, is limited. We must recognise that we shall have to face the problems of those other groups one by one as they arise.
  5.8 p.m.
  Mr. John Hannam: The hon. Member for Welwyn and Hatfield (Mrs. Hayman) raised some important points about pre-natal care, particularly in her references to the need to educate and inform parents about certain precautions
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  and about the effect of the drugs which they may be taking during pregnancy. I fully concur with her view that we are not doing enough yet in this regard and that we are not sufficiently protecting the unborn child.
  Certainly the information provided by the Office of Health Economics shows that, for example, if we had the same system as Sweden has, some 16,000 children would be prevented from suffering illness and disability at birth. I understand that the French have introduced a new system which requires mothers-to-be to attend a certain percentage of the pre-birth courses and classes, otherwise they do not receive child benefit. That is a pretty strict regime, but it is resulting in well over 90 per cent. attendances at those classes.
  I agree with the hon. Lady that in connection with vaccine-damaged children there is a great deal of fear and ignorance on the part of parents which I do not believe has yet been fully alleviated. Therefore, that must play a full and important part in our approach to the question of compensation for vaccine damage.
  My hon. Friend the Member for Canterbury (Mr. Crouch) related a very moving account to the House of the effect of severe disablement upon a family in his constituency. I think that all of us have come across similar cases in our constituencies. I know a family in mine in similar distressing circumstances. Both parents are severely disabled themselves, and one of the two daughters is also severely disabled. I have got to know that family well and the problems that they face in housing, education, clothing, aids and adaptation and transportation, and medical help itself. The obstacles they face are immense, yet their determination and fortitude in overcoming them has made me proud to know them and determined to help as much as I can.
  Such examples have affected the attitude of many hon. Members, and I therefore give a very warm welcome to the Bill. I echo the congratulations of my hon. Fried the Member for Reading, South (Dr. Vaughan) to Rosemary Fox and her association. I recall the early days in the all-party disablement group when Mrs. Fox and other parents of vaccine-damaged children were coming to the

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  House regularly to try to persuade us of the case for this compensation. I think that all members of the group who attended the meetings quickly accepted the validity of the case, but its success was very much due to the efforts of the hon. Member for Stoke-on-Trent, South (Mr. Ashley). He spearheaded the thalidomide campaign, and followed it up with the campaign for compensation for the vaccine-damaged children. He underwent a great deal of, I would say, abuse from writers and others in the media, and even some difficulties with the Government in exchanges in the House. Nevertheless, he stuck to the campaign and spearheaded it, and he and Rosemary Fox must be feeling proud of the outcome today.
  As my hon. Friend the Member for Reading, South pointed out, the problems of overcoming the medical objections, and also the financial objections inevitably faced in calling for expenditure, could have resulted in damaging delay to the families themselves and the immunisation programme as a whole. I know the agony of parents faced with the decision as to whether to have their babies vaccinated, because at the time when the verbal battle was being waged, both in the press and on radio and television, more and more parents became scared and withdrew from the general whooping cough immunisation programme. Many withdrew from the other programmes as well.
  Two years ago, my wife and I faced this decision ourselves. Our two-year-old daughter was then in the middle of her vaccination programme. The agony of the uncertainty and fear that my wife and I underwent in deciding whether to proceed with whooping cough immunisation caused us many sleepless nights. We know the consequences. There was a sharp drop in the number of children receiving whooping cough immunisation, and since then there has been a sharp increase in the incidence of the illness.
  I therefore support the Bill as an interim measure—and I stress the word "interim"—of compensation. I hope that it will be followed by further action and attempts to ensure that the costs of providing proper care for the severely handicapped children—and grown-ups, as they will be—will be covered throughout their lives, because, although the Bill goes part of the way towards helping them at an early stage, we must remem-
  62
  ber that problems and costs increase as they grow older.
  The Pearson Commission's recommendations showed clearly that substantially higher damages are required for such severe disabilities, and therefore this sum of £10,000 must be regarded as just the beginning rather than the end. I was pleased that the Secretary of State, in answer to questions from my hon. Friends the Member or Wells (Mr. Boscawen) and Walsall, North (Mr. Hodgson) concerning disregards for supplementary benefits, was able to say that this money would in fact be disregarded for that purpose.
  It would indeed be cruel if this payment meant that some benefits were reduced in such a way as to force a family to find some means of disposing of the money at a very early stage in order to restore their rightful benefits. We know that such a situation exists in other areas—we hear about it repeatedly at our advice surgeries from constituents who have had to think in terms of restoring their social security benefits by getting rid of whatever amount of money they have which has been regarded for supplementary benefit purposes.
  This compensation as an interim payment helps in several ways. It gives some confidence back to the whole immunisation programme; it signifies the validity of the parents' campaign and the campaign by hon. Memberes; it also lays the foundation stone for a proper scheme of compensation for all those severely disabled and handicapped in various ways. I hope that we shall indeed regard it as the foundation stone for a much wider scheme. I congratulate the Secretary of State on the Bill. I know that the whole House will wish it a speedy passage, and I have great pleasure in supporting it.
  5.17 p.m.
  Mr. Andrew MacKay: I apologise for not being present throughout the debate, but for personal reasons I was late in arriving at the House. But there is a special reason why I, like my hon. Friend the Member for Exeter (Mr. Hannam), want to speak.
  Until recently, I had taken only a general interest in the problems of vaccine-damaged children, but then I had the

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  case of a constituent whose child had had whooping cough vaccination when only a few months old. That child is now eight years old. I have visited the family on several occasions. The state that that child is in so appalled me that it has shaken me out of what was perhaps a sense of complaceency and almost of disinterest. We in this House have so many problems, both constituency problems and national problems, that it is easy to be blase and uncommitted and to say "It has not happened to me or my family or to any of my constituents; I am sorry, but I have not time to look into it."
  Three particular problems about this family worry me immensely. The first is that the family have not received any aid for eight years from the State, except for an attendance allowance. I believe that that is quite disgraceful. Secondly, I was glad to hear the Secretary of State say that the £10,000 is an interim award, because £10,000 now, bearing in mind not just the suffering of this family but also their future needs, appears quite inadequate.
  When people ask, as a writer in the local press did recently, "What do they need £10,000 for? Are they not cashing in on the misfortune of their child?", I find the question easy to answer. In this case the mother is near a nervous breakdown. She is totally run down. It is obvious even to inexpert eyes that nursing facilities must be made available, because the child is severely brain-damaged and is incapable of looking after itself or coping in any way. It is even unable to go out to a special day nursery. To employ a nurse on a part-time or semi full-time basis is immensely expensive.
  Thirdly, I am also distressed that the family have had no proper holiday in these eight years. The parents could not possibly take the child on holiday with them. It has meant that the other two children have not had a proper holiday either. So the £10,000 will go towards having a nurse in to look after the child full-time while the rest of the family go for the holiday that they so desperately need.
  I hope that the Minister takes on board the fact that the £10,000 is totally inadequate, although those affected will be
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  delighted to accept it. They will appreciate that it is an interim award. Whatever the lump sum, there should be some form of pension made payable at a certain age, presumably after the age of 16 or 18, to a vaccine-damaged child. The parents will not live for ever. I do not think that the other children should have to care for the vaccine-damaged child for the rest of their lives. I know that the parents of such a child would like to think that he would be adequately looked after thereafter. Something along the lines of war disablement pension would be highly appropriate. The Minister received many representations along these lines. He must be looking carefully at the question of what form of pension should be given. It would be interesting to hear about this today or in the near future.
  I am immensely worried about the delay. I appreciate that we must be absolutely certain of the medical facts. We do not shell out money whenever somebody thinks that he should have aid. However, it has been proved without any shadow of doubt in at least my constituents' case, and I assume in many other cases, that the brain damage was caused by the whooping cough vaccine. Local doctors and specialists confirmed that to me. The parents were diligent. They thought they were doing right eight years ago. They read the various pamphlets, many of which were issued by the DHSS. They took careful note of what they should do as parents. They came to the conclusion that it was right and proper to vaccinate their children against whooping cough.
  Therefore, the State has a moral obligation. This is not a matter of whether public money should be spent. This is a special case of, first, compassion and, secondly, a moral obligation on behalf of the State to ensure that these people are properly looked after.
  It is amazing that in eight years these people have not received one penny apart from the attendance allowance. That is disgraceful. I do not blame individual Ministers or bodies. It is a disgrace which reflects on the House. In what we call a civilised, compassionate society we should hold our heads in shame when we see a family such as that in Stechford who suffered so much and received so little compensation.

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  I end on a more optimistic note. I am slightly worried about this matter. Therefore, I should like to hear what the Minister says about it. I refer to a problem that affects many parents. I am a parent. My wife gave birth to a baby daughter in the past week. That is one reason why I was late in coming to the House today.
  Many parents are worried about the word "vaccine". Therefore, vaccination has suddenly become a dirty word. We have not vaccinated our two-year-old son against whooping cough. However, we shall vaccinate him against other diseases. I think immediately of polio. I am worried about this. I speak to many of my constituents who say "We shall not vaccinate our children against anything. We have seen those television programmes and have read the articles in the press." This might do considerable harm.
  The DHSS must introduce a major public relations exercise to explain that the majority of vaccinations carry with them no risk or such a negligible risk that it is well worth taking. Some diseases may kill or cripple for life. It would be sad if we went backwards by risking the health of our children even more by not vaccinating them. Therefore, I ask the Minister to give special consideration to allaying the real fears of parents.
  5.26 p.m.
  Mr. Victor Goodhew: I welcome the Bill. Many Members must have come across the impact on parents and know what it is like to be faced with severely mentally or physically handicapped children. I came across this problem first when I became a Member of Parliament 20 years ago.
  Before the boundary changes my constituency of St. Albans contained four psychiatric hospitals, which I visited. Having two healthy children, my reaction, upon going round and seeing the unfortunate children, was to realise how grateful I should be every morning that I am fortunate to have healthy children who have not suffered, for a reason that no one could have imagined, the terrible backwardness and disablement that come in certain circumstances. When one realises how grateful one should be for not having suffered when confronted with the sight of children who are afflicted in
  66
  this way, one understands all the more that, as a result of a quirk of science, something that was intended to benefit all has been of great disadvantage to a small limited number.
  I doubt whether there is anyone in the House, or indeed in the country, who would not be in favour of a Bill such as this which is designed to recompense those who have suffered as a result of what has basically been good for people as a whole but has turned out to be deeply unfortunate for those who have suffered from this quirk of science, which caused a vaccination to be good for many people but bad for a few.
  When considering a Bill such as this, we must have very much in our minds the feelings of the parents who have this responsibility. They were urged to do this for the benefit of their children. Suddenly the tragedy hit them in the face. We say "Yes, it is right", but then it is heartbreaking for parents to discover that their children suffer as a result. There is nothing that can fully recompense the child or parents in a case such as this. The parents are bound to feel that they had the choice and that if they had not made the choice they did they would have spared their children these problems. As a result, the children are left with disabilities for life and will need help.
  Therefore, when we talk of sums such as £10,000 I am inclined to think that we are being somewhat mean. I do not suggest that the Government are being mean, because they are setting off on a road on which clearly in future we shall have to increase the payments. We live in a time of great inflation. The sum of £10,000 seems large today, but a few years ago £5,000 seemed a large sum and in 10 or 20 years it will appear very small.
  The House will have to watch the matter closely over the years. We are responsible for making sure that our present aims are achieved in the years to come as the children grow older and the problems of life become greater. Who knows whether the children will be fortunate enough to have the support of their parents until the parents reach a great age? Some of us are fortunate enough to have had that support for a long time, but others lose their parents very young. I am one who was lucky and whose parents lived into their eighties. I enjoyed their care for many years, but we cannot

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  assume that that will be so for all children. Therefore, we shall have to be prepared to increase the amount that we pay to those who suffer from the misfortune with which we are dealing.
  Having said that with feeling—and confidence that the House, which is always a compassionate and sympathetic place, will ensure that once we have put the measure on the statute book we continue to look after those who are affected—I add my voice to those who have said that nevertheless the vast majority of people benefit from vaccination. I should hate to say anything that would discourage others from taking advantage of any medical treatment of the sort in question, where the opportunities of its going wrong are so small. Such discouragement could cause others to suffer even worse health than they might if their parents decided to have them treated.
  I welcome the Bill and express gratitude to the House for its attitude. As time goes on and we experiment with other drugs we may, alas, have to face other such cases. But that is no reason why we should not try to prevent illness from spreading amongst our children, seeing that, where necessary, we compensate to the maximum possible, though nothing can really recompense those who suffer and their parents who have taken the decisions that caused that suffering.
  5.33 p.m.
  Mr. Patrick Jenkin: The House has been impressed by the case advanced this afternoon in favour of the Bill. Anyone listening to our debate, brief though it will have been, will have been impressed by the sense of sympathy and the desire to make some form of recompense that has been expressed on both sides of the House.
  This is a fairly long story. It is certainly not finished, but this is an important stage in it. The anxieties and fears that began to be voiced about the effects of certain kinds of vaccination on children stretches back a number of years. The feeling that some recompense should be made to them has grown steadily in force.
  I should like to add my voice to the voices of the Secretary of State, my hon. Friend the Member for Reading, South (Dr. Vaughan) and others who have paid tribute to Mrs. Rosemary Fox and her
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  association for the way in which, always using constitutional and proper means and using them effectively and well, they have brought to the attention of hon. Members the need to do something to meet their grievance.
  As a matter of history, the first Bill on the subject that I have been able to find was presented by my hon. Friend the Member for Christchurch and Lymington (Mr. Adley). It was a Ten-Minute Bill which had its First Reading on 3 February 1977. It was after that, on 14 June, that the Government accepted in principle that there should be some form of payment to families whose children could be established to have been damaged by vaccine.
  I think that the case had been conceded by the Government earlier. It is interesting to note that when it gave evidence to the Pearson Commission the Department of Health and Social Security Standing Medical Advisory Committee said:
  "As vaccination was encouraged by the medical profession and the Department of Health for the benefit not only of the individual but also the community, a reasonable case could be made for paying compensation."
  Those who are familiar with the Whitehall jargon might well have recognised that that was an important step on the path to the decision that was eventually announced to pay some form of compensation.
  The argument in its later stages in recent years had been dominated by the knowledge that the Pearson Commission was sitting, having been set up by my right hon. Friend the Member for Sidcup (Mr. Heath) in the aftermath of the thalidomide disaster. It was natural that Ministers in all Governments should have taken refuge—I do not use that word in any pejorative sense—in the Commission's existence, knowing that the question of vaccine damage to children was firmly within its terms of reference and that it could be expected to report. But the pressure grew, and in the aftermath of the pressure we saw a sharp falling off in the number of children taken for vaccination, not only for whooping cough but for the other, in many ways more serious, diseases against which vaccination is a sure and necessary protection—diseases such as poliomyelitis, diphtheria and tetanus.

  69
  I think that it was the knowledge that public health was being put at risk by the fears that had been aroused, and the fact that in a tiny minority of cases severe personal damage had occurred, coupled with the growing sense of the injustice to families that had done something not only for their own benefit but for the benefit of the community at large, that persuaded the House and the Government that it was essential to do something.
  Here we are today with the Bill and with the process of adjudication and payment well under way. I should like to make it clear that in such circumstances I make no complaint about that. In no way do I want to take a purist stand on financial grounds. I am told that the way in which the matter was dealt with last year in the Estimates was entirely in accordance with precedent. Perhaps we can welcome the fact that that was done, although the Bill has been a little delayed.
  I have a number of questions, picking up questions that have been asked from all parts of the House, which I hope the Minister with special responsibility for the disabled will be able to clarify. The first is the key question: is the proposed payment an interim payment? I have carefully studied all the Secretary of State's statements, from the first on 14 June 1977 through to that on 9 May 1978, when he announced the scheme, and I listened to him carefully today. I do not think that at any stage has the right hon. Gentleman used the phrase "an interim payment". He has been most meticulously careful not to do so. Yet a number of hon. Members throughout the House have seemed to assume that, becauss it clearly falls far short of what, in the kind of circumstances we are considering, a child would be awarded if he could establish a claim before the courts, £10,000 must be an interim payment. But the right hon. Gentleman has been extremely careful at no stage ever to use that expression.
  Mr. Ennals: Quite right.
  Mr. Jenkin: I am grateful to have the right hon. Gentleman's confirmation. I thought that I had read carefully what he said and his comment suggests that I have. He was asked about this on a number of occasions and gave a number of answers, one of which was that
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  this is not a payment of compensation. If this is not compensation, why should it be taken into account if subsequently any of the families succeed in establishing a claim to compensation under an action of tort? Perhaps that is a matter which the Minister with responsibility for the disabled can deal with later. If this is not compensation, should not it perhaps be left out of account?
  One of the other points made by the right hon. Gentleman relates to what he said last year in reply to my hon. Friend the Member for Canterbury (Mr. Crouch). He said:
  "The second point that the hon. Gentleman must recognise is that this is not a compensation scheme, as I made clear. This is not saying, 'This is the end. We are wiping the slate clean'. This is some way in which we can help these people now, and I do not think that anyone ought to say that it is a small sum."—[Official Report, 9 May 1978; Vol. 949, c. 980.]
  There he is making it clear that this is some form of help now. That, I believe, has always been the Government's intention. But the question is, where do we go from here?
  The Pearson report recommended that there should be some such payment. Paragraph 1398 stated:
  "We concluded that there is a special case for paying compensation for vaccine damage where vaccination is recommended by a public authority and is undertaken to protect the community. We had reached this conclusion when we were asked by the Government for our views."
  A little later, in paragraph 1406 under the heading "Our proposals", it said:
  "We do not think it is right to try to distinguish one severely disabled child from another, and to produce a situation where two children have the same needs, but one is compensated and the other is not. We decided, therefore, that vaccine damaged children should be considered with other severely disabled children, irrespective of the cause of disablement. We explain our conclusions in chapter 27."
  The right hon. Gentleman reminded us that chapter 27 recommended that there should be a special disability benefit for disabled children, which, on 1977 figures, should be £4 a week. That was felt to be the average extra cost to a family of bringing up a severely disabled child. But the Secretary of State was pretty clear in his conclusions on that Pearson recommendation—the disability benefit—when he

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  opened the debate on the Pearson report last year. He said:
  "I am sure that the House will agree that it would be difficult to accept this recommendation without knowing what may be the outcome of our long-term consideration of a general disablement allowance."
  A little later he added:
  "Therefore, I must reserve the Government's position on this recommendation until we can announce decisions on the issues that I have been talking about."—[Official Report, 17 November 1978; Vol. 958, c. 777–8.]
  He and I both took part in that debate, and we remember that no conclusions emerged. It was a general, if somewhat brief, exploration of the large and exceedingly complex area covered by the Pearson report.
  Pearson recommended that there should be compensation for vaccine-damaged children, which it saw in the context of a general disablement benefit, whereas under this Bill that is left hanging in the air on its own. As a result, what is happening is precisely what Pearson recommended should not happen —that where two children suffer the same degree of disability one is compensated and the other not. Quite frankly, I do not see the way out of this impasse until, as is agreed on both sides of the House, we can move forward to a more general disability scheme. I think that that is the Secretary of State's view, and that is our view.
  I do not want the Government to be under any illusions. Under this Bill, some families with severely brain-damaged children will get £10,000 whereas others, where damage has been caused by some other accident, perhaps congenital, will not. That is not a state of affairs which any of us can view with equanimity. Therefore, however long it may last, we are in an interim period.
  Mr. Ennals: We are in an interim period in the sense that no decisions have been taken as to what the next stage is. I absolutely recognise that Pearson made the case against having a benefit which, in a sense, would discriminate as between one child and another. I am really trying to explore whether there is any difference between us. I suspect that there is not. Before Pearson reported, this House decided that, regardless of what happened to other disabled children, those who had
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  been disabled from vaccine damage which was public policy had a very special reason for assistance. I am just trying to explore whether there is any difference in philosophy here, because I suspect that there is not.
  Mr. Jenkin: I think that the right hon. Gentleman is right. I believe that I made the point about public policy before he returned to the Chamber. I do not think that there is a lot of difference between us. In fact, all that I am seeking to do is to point out that, although this is not properly described as an interim payment—I see the reasons for that—we are nevertheless in an interim situation which cannot continue indefinitely. That is something to which any Government clearly must address themselves.
  I return to the position facing the families of children who stand to benefit under the Bill.
  Mr. Ashley: The right hon. Gentleman says that we are doing precisely what Pearson said we should not do—because Pearson said that we should help all disabled children—but is it not a fact that Pearson was contradictory, because simultaneously the report said that we should pay vaccine-damaged children? Therefore, we should not really quote Pearson as being against this payment for vaccine-damaged children.
  Mr. Jenkin: I was not quoting Pearson against that. I was pointing out that the Pearson report, having accepted that there was a special case for vaccine-damaged children, then said that it was to be merged with support for all seriously handicapped children. That is a proposal to which as yet, having regard to our economic position, neither side of the House has felt able to commit itself. Therefore, this is an interim situation, and we must recognise that.
  I turn to the problem facing the parents and families of these children. The right to sue is preserved. Nothing affects that. But unless the law is changed to provide for strict liability, and the question upon whom, it must be exceedingly doubtful whether any parent can establish negligence in such a way as to establish a claim for damages. One area where a possibility might be opened up is in relation to the conclusion in the report of the

  73
  Ombudsman which was published in October 1977. He said:
  "I consider that the Departments must accept a large measure of responsibility and I believe that they should have recognised earlier the desirability of alerting parents, as they have now done. I believe the Association"—
  that is, the Fox association—
  "have performed a valuable service in bringing this matter to the attention of the public and the authorities."
  Therefore, there was clearly a finding that the Department—I completely concede the point that this occurred under successive Governments—had fallen short of the standards that the Ombudsman felt were right.
  It is interesting to note that in a statement made on the publication of that by the Secretary of State, a copy of which I have in front of me, he said:
  "On balance I accept that this criticism is justified. Attitudes as to how much information parents should be given on such matters have rightly changed over the years. These days parents want—and in my view they should be given—as much information as possible before taking decisions that affect their children's welfare."
  There may be something there that could found a claim against the Department, but that is a legal matter. I do not expect that the Under-Secretary will be able to say anything about that. But, as for establishing a claim against a doctor or a drug company, the parents face almost insuperable difficulties unless there are special circumstances. I hope that the Minister will mention that briefly in his reply.
  I was out of the Chamber when the Secretary of State finally clarified the position about supplementary benefits. I had been relying on the statement he made on 2 August in which he said:
  "The effect of payment under the scheme on eligibility for supplementary benefit has been carefully considered by the Supplementary Benefits Commission. They have decided that, where the vaccine damaged person is a child, it would be right in assessing the parent's entitlement to supplementary benefit, to disregard the payment to the extent that it is held in trust for the benefit of the child or earmarked for particular major items of expenditure such as adaptations to the home. Where the vaccine damaged person is an adult, the payment will normally remove his or her means for supplementary benefit …"
  He went on to talk of the Commission giving sympathetic consideration to special cases. Does anything that the right hon.
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  Gentleman has said today alter that position?
  Mr. Ennals: I do not think so.
  Mr. Jenkin: I am grateful for that confirmation. My hon. Friends may wish to probe this matter in Committee. There are a number of different aspects which may give rise to questions in particular cases.
  Mr. Crouch: My right hon. Friend was satisfied by the nod or murmur from the Secretary of State, but I am not quite satisfied. The matter concerns a child, and I am wondering when a child is still a child. A child who has suffered vaccine damage at the age of two or three will reach the age of 15 or 16, but could be damaged in such a way as still to be a child. Will the Department consider that person to be still a child?
  Mr. Jenkin: I hope that the Under-Secretary will be able to answer my hon. Friend's question. I was concerned only to discover whether anything different had been said today.
  Mr. Ennals: Nothing has changed. A child is no longer a child after the age of 16.
  Mr. Jenkin: On legal aid, if there is to be any question of parents suing for damages—and it may be possible to get a case on its feet on the basis perhaps of the Ombudsman's report—will the family be entitled to legal aid without taking account of the £10,000 that has been paid? On 2 August the Secretary of State said:
  "The effect of the payment on eligibility for legal aid in matters relating to vaccine damage is being further considered."
  That is an important question, and I hope that the Minister will deal with it today.
  In the Bill it is said that cases will be decided on the balance of probability. A number of hon. Members have interpreted this as meaning that the claimant will be given the benefit of the doubt. Although it is some time since I was involved with the law, I do not think those two phrases mean the same. If the balance lies 50·001 per cent. in favour of the claimant, he is entitled to a decision in his favour on the balance of probability. But if there was not the necessary evidence for a decision although some factors were present, the applicant could be given the benefit of the doubt

  75
  and get the payment under the Bill. But that is not what the Bill says. Perhaps the Minister could deal with this, and it may need to be further explored in Committee.
  On the system of payment, in his statement on 2 August the Secretary of State said:
  "We propose to pay the money to them—
  that is to say, the family—
  "one half in trust for the benefit of the damaged person and the remainder so that it can benefit the family and their needs as a whole."—[Official Report, 2 August 1978; Vol. 955, c. 425.]
  Is it intended that the trusts spelt out in clause 6(3) of the Bill shall provide for that half-and-half split, or is there to be some system whereby the circumstances of the family can be examined and the trust drawn according to their need? If that is so, it will add to the complication and delay. It may be right, but I should like to know what the Government have in mind.
  The courts have always regarded it as perfectly proper for some of the money awarded to a family, one member of which is disabled, to be spent for the benefit of the family as a whole. In a family with a severely disabled child, the other children are in many ways socially handicapped. Some arrangement should be made that the money, or part of it, can be spent for the family as a whole. My hon. Friend the Member for Birmingham, Stechford (Mr. MacKay) mentioned a family with a child of eight years of age which had not had a holiday. The family fund is there to help in such cases, but this kind of money could also be properly used for that purpose.
  The vaccination programme has had a somewhat chequered history. We need to know where we stand following the continued dispute about the need to compensate vaccine-damaged children and the resulting publicity. Even the word "vaccination" came to have an alarming connotation. The numbers of children having all forms of vaccine fell off sharply.
  There followed a difficult period when there appeared to be—although I am assured that there was not—a difference of view between the Joint Committee on Vaccination and Immunisation, under the chairmanship of Sir Charles Stuart-
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  Harris, and the Committee on Safety of Medicines, under the chairmanship of Sir Eric Scowen. Having had full discussions with these eminent gentlemen, I accept that there was in no sense a conflict of view. They were looking at different aspects of the same problem. But it led to the postponement of the campaign envisaged by the right hon. Gentleman. He announced that decision on 21 November 1977, in a written answer to the hon. Member for Eccles (Mr. Carter-Jones). It is a long answer and I shall not attempt to summarise it. But he thought that there was sufficient doubt about the balance between the efficacy of pertussis vaccine and the possible risk to children that it would not be right at that stage to launch a major publicity campaign. In a remarkably short time, however, that difficulty appeared to have been withdrawn. In an answer to my hon. Friend the Member for Manchester, Withington (Mr. Silvester) on 7 February 1978—a little less than three months later—the right hon. Gentleman announced the decision to launch the publicity campaign.
  Mr. Ennnals: There really was a difference. One was a publicity campaign to the effect that on balance one should have one's child vaccinated. It was clear that this was not the advice that I received from the Joint Committee. Therefore, the campaign that we launched was educational, so that people knew what questions to ask and what to say to the doctors in their clinics. What we did was to change the nature of the campaign from one of advocacy to one of inquiry.
  Mr. Jenkin: I do not need to tell the Secretary of State that there are still anxieties and uncertainties. It is true that the medical profession is very much more alerted to the contra indications than it was previously. This point was made earlier in the debate by the hon. Member for Stoke-on-Trent, South (Mr. Ashley), who said that not enough attention had been given to the specific circumstances of vaccinations in the past.
  I remain firmly convinced that it is absolutely essential that the whole programme of pulic vaccination of children should be given every possible encouragement to go ahead. I can think of nothing that would do more to undermine

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  everything that has been said about prevention than if we were to be satisfied with the relatively low levels of vaccination that are currently being achieved. Whereas one may wish to be cautious about whooping cough—and I can understand a parent who will not have a child vaccinated against whooping cough unless there were an epidemic posing an immediate threat—the same is most emphatically not true of diphtheria, tetanus and polio. I hope that none of the anxieties that have surrounded this issue will lead any parent to decide not to have those other most important vaccines.
  A very important paper appeared in the British Medical Journal on 1 April last year. It was by Dr. A. H. Griffith, who is deputy director of research at the Wellcome research laboratories. It is a long paper and I shall not attempt to summarise it, but Dr. Griffith makes two important points. The first is that vaccines differ substantially and one cannot draw from the results of one vaccine conclusions about what might happen with another. His second point was quoted in a leading article in the British Medical Journal, which said:
  "Dr. Griffith's study shows that any manufacturer who accepts his obligation to collect, record, and consider the incidence of reactions to his vaccine faces a frustrating and indeed nearly impossible task."
  If we are trying to develop safer vaccines and refine our understanding of the indications and contra indications of their use, that is a pretty serious statement coming from someone who is personally faced with the problem. I hope that the Government have given serious consideration to how best they can improve this aspect of community medicine, so that we may hope to reduce to the absolute minimum the cases where, in pursuance of a public campaign for vaccination, a tiny number of children become seriously damaged. If there is a gap between the manufacturers trying to assess the value and safety of their vaccine and the information that should be fed back to them, we should take this extremely seriously. It is most important to restore full confidence in the vaccine programme.
  Dr. Alastair Dudgeon made an important statement the other day when he said that there had been a considerable increase in the number of cases of whooping cough. This continues to indicate
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  the need for children to be vaccinated against it. Fortunately, we have had a mild strain during this last wave and mercifully relatively few children have died. But if the next strain turns out to be more serious we would be in a most unhappy position if a significant number of children died from whooping cough because their parents had been frightened off vaccination as a result of the disputes of the last two years.
  I have spoken long enough and I have asked the Minister a number of questions. The Opposition very much welcome the Bill and we shall do what we can to ensure its speedy passage. This is an important new benefit for a very deserving category of people. We wish the Bill well.
  6.6 p.m.
  The Under-Secretary of State for Health and Social Security (Mr. Alfred Morris): This has been a brief and businesslike debate but, in human terms, an important one. It has also been a very well-informed debate. In replying, I should like to express my appreciation of the way in which the Bill has been received by the House. I readily join the hon. Member for Reading, South (Dr. Vaughan) in the tribute he paid to the leaders of the campaign to help those who have been vaccine-damaged. In particular the hon. Member congratulated Mrs. Rosemary Fox and my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley). They have both worked long and hard and with great sincerity to advance this important cause, and they deserve our deepest respect.
  The right hon. Member for Wanstead and Woodford (Mr. Jenkin) seemed to imply that one of his hon. Friends first raised this issue in 1977, following which Government action was promised. In fact, my hon. Friend the Member for Stoke-on-Trent, South raised it as long ago as 1974, and has done so continually since then. He asked for vaccine-damaged children to be regarded as a special case. They are treated as such in this Bill. As my hon. Friend said, the Bill is an important step forward in social policy and we are proposing it at a time of great economic difficulty.
  We should, of course, like to go further than the Bill provides, but no matter how far we went in increasing its scope there would still be a dividing line somewhere

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  between successful and unsuccessful claimants. Although there has been some constructive criticism, there is clearly also the feeling in the House that this Bill strikes a reasonable balance, having regard to its purpose. That purpose is to provide a rapid measure of present and future help for those who have been damaged by public health vaccination programmes and for the families who support them.
  Several hon. Members have made clear their concern about whether the payments under this Bill are all that we hope or intend to do for people who have suffered vaccine damage. As my right hon. Friend made clear in opening the debate, it is still too early to announce the Government's decisions on the recommendations in the report of the Pearson Royal Commission on civil liability and compensation for personal injury.
  The recommendation in the report on vaccine damage was that the Department or local authority concerned should be strictly liable in tort for severe damage suffered by anyone as the result of a vaccination recommended in the interests of the community. That would mean, in effect, that people wishing to pursue claims for compensation in the courts would need to prove the fact of severe damage due to vaccination but would not need to prove negligence. My right hon. Friend has today again made plain that we are studying the recommendation in consultation with the medical profession and that there is still a good deal of work to do. The recommendation has to be considered with others in the report which are also relevant. They include such matters as product liability, medical injury and cover for exceptional risks, all of which have a bearing on vaccine damage. So, too, does the whole question of the assessment of damages, on which the Royal Commission made some far-reaching proposals.
  In this context, the Bill is a particularly valuable measure, because it provides a means of bringing help now and not in the future. Whatever one may think about the amount of compensation which might, in any future scheme, be expected to flow from the courts, the payments under the Bill are available now, without litigation, to all who meet the tests laid down.
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  Even today, £10,000 tax-free is not an inconsiderable sum of money. It will clearly be right that this sum should be taken into account in any assessment of compensatory damages obtained through civil proceedings in the future; and this is provided for in clause 6(4). My hon. Friend the Member for Welwyn and Hatfield (Mrs. Hayman) referred to this matter and I shall return to it later.
  The Government hope that the Bill will be seen as a valuable and practicable step towards alleviating distress. The House will wish to know that about 2,000 claims have so far been received, and we think that that number may well represent the bulk of the total number of claims to be expected. Of the cases so far scrutinised, we have reached the position where, as my right hon. Friend said earlier, some 50 claimants have been notified that payments will be made to them shortly. In those cases, all that remains to be done is for the necessary deeds of trust to be executed.
  The main constraint on processing claims at the moment is the need for each case to be examined in detail by the Department's medical officers, but we are pressing ahead and should have a good many more decisions ready for notification quite soon. Indeed, without wanting to give hostages to fortune, I hope that all cases will have passed through the initial processing stage by the middle of the year.
  All those whose claims has been disallowed will, of course, have the right to ask for their case to be considered by one of the medical review tribunals to which my right hon. Friend referred earlier. The tribunals will, of course, be wholly independent of my Department and their decisions will be binding.
  Mr. Patrick Jenkin: Earlier in this matter, the figures of 700 cases, and £7 million given from the Dispatch Box by the Secretary of State. I appreciate the uncertainties in this matter, but is there any particular reason why the Government should think it right to write into the Bill a reduction in the estimates of 100 cases and £1 million?
  Mr. Morris: I should emphasis again that, in the nature of vaccine damage, the basis of any estimate must be more than usually speculative. As my hon. Friend the Member for Stoke-on-Trent, South

  81
  noted, we are breaking entirely new ground. This is the first time that any Government have proposed special help for vaccine-damaged people. We are conscious of the speculative nature of the estimate and we shall seek to keep the House fully informed of the number of applications and the response to them.
  It must he emphasised, however, that, if a large proportion of claimants who are unsuccessful at the initial stage ask, as they are entitled to do, for a review of their cases by the independent tribunals, there will inevitably be delays. That is because there are not many consultants with the required degree of specialist knowledge to man tribunals dealing with these difficult issues.
  I think that it would be helpful to the House if I make one further point. In the financial memorandum to the Bill, we give an estimate of 600 eligible cases at a possible cost, therefore, of £6 million for the scheme. But in the nature of vaccine damage, the basis for this estimate is more than normally speculative. The figure of 600 was put in merely in order to earmark funds of a broad order of magnitude and, whether the final figure turns out to be more or less than that, we shall of course honour our commitment. But it would be impossible at this stage to attempt to offer any more precise figure when only a quite small proportion of the claims has so far reached full medical scrutiny and when the independent medical tribunals for which the Bill provides have not yet started to function.
  I referred briefly to the deeds of trust, and the House may like me to explain a little more fully what we have in mind in relation to the provisions in clause 6(3), which deals with the trust arrangements which may be declared by the Secretary of State. In the great majority of cases, the disabled persons are living with their families, and our objective is to make the sum of £10,000 available in the most flexible way possible for the general benefit of the family. Ordinarily, the parents themselves will be the trustees, and the trust deed will give the utmost discretion to the trustees. The money can, for example, be spent on buying or extending the family home, buying a car or covering the cost of holidays for the whole family or even for members of the family other than the disabled person.
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  The trust deed will necessarily be a somewhat complex legal document, but we shall be supplying parents, where they agree to act as trustees, with a note which explains the arrangements in simple terms.
  Dr. Vaughan: This is a very important point. Will there be any control on how the money is spent, or will it be left to the parents to spend the money in whatever way they feel is best?
  Mr. Morris: I have said that the arrangements are very broad. I shall he coming back to the question of trust deed arrangements and I hope that what I have to tell the House will be helpful, but what I have said is about as far as I can go at the moment. There will be further opportunities for detailed debate.
  Where the disabled person is not living with his or her family or, for whatever other reasons, parents or other close relatives are not appointed as the trustees, we envisage that normally the Public Trustee will administer the trust. In either case, however, I must stress that, once the trust deed has been fully executed, my right hon. Friend will not be concerned with the disposition of the money. That will be for the trustees to deal with in accordance with the provisions of the trust deed and of normal trust law.
  In a written reply on 2 August, my right hon. Friend the Secretary of State described the arrangements for payments in trust. He said
  "If the damaged person is under 18 and living at home in normal family circumstances, with the parents responsible for his or her care, we propose to pay the money to them, one half in trust for the benefit of the damaged person and the remainder so that it can benefit the family and their needs as a whole".—[Official Report 2 August 1978; Vol. 955, c. 425.]
  The matter has since been reviewed and we have reached the conclusion that it would be better, instead of dividing the payments in two in that way, to make an undivided payment subject to a single trust which enables the entirety of the payment to be spent for the benefit of the family as a whole. This is a more flexible arrangement than that originally envisaged because, under the original proposal, £5,000 of the payment was reserved strictly for the benefit of the disabled person and could not have been used to

  83
  benefit him indirectly by helping with the family situation as a whole.
  We have been in touch about these arrangements with the Association of Parents of Vaccine-Damaged Children and it has expressed misgivings about this aspect. It is particularly concerned about the case where the parents have been caring for the disabled child for a considerable number of years and have had, on this account, to deplete their financial resources, for example, by the constant needs to replace furniture and fittings damaged by a hyper-active or incontinent child. The association apparently construed the original announcement as enabling the £5,000 of the payment to be immediately set aside to make up for the depletion of the parents' resources through such expenditure.
  But this could not have been the case either with the orginal arrangement or with the revised version and it is difficult to see how an express provision of this sort could be fitted into a scheme which is essentially not one for payment of compensation for past expenditure but one for providing some help with the current and future burdens of the family concerned.
  However, my officials are due to meet representatives of the association in the near future, and, if it has any specific proposals to put forward to deal with this matter, we shall look at them sympathetically.
  There is one other important point that I want to emphasise about the subject matter of this important debate. That the Bill deals with vaccine damage should not obscure the fact that the proportion of children and others damaged by vaccination is small. I know that the House as a whole would want to make it clear that nothing that has been said today should be allowed to give any impression that vaccination programmes are to be discouraged. On the contrary, they have the full and unqualified backing and support of the expert bodies which advise my right hon. Friend and, indeed, of the medical profession in general. I want to remind the House of this again and to re-emphasise what my right hon. Friend said earlier.
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  I turn to some other matters which have been raised during the debate. If I am unable to deal with a particular point, I shall be pleased to do so later in writing.
  My hon. Friend the Member for Welwyn and Hatfield has explained to me that she has had to leave the Chamber because of another pressing commitment. She mentioned clause 6(4). The Bill deals only with payments of the £10,000 being taken into account if there is a subsequent award of damages in civil proceedings. The purpose of the Bill is to prevent the total payment in such a case from being greater by £10,000 than it would be if there were no entitlement to the £10,000 but only compensation.
  What might happen subsequent to any successful compensation proceedings is a separate matter which is not dealt with in the Bill. I regret that I cannot speculate on that matter today.
  The hon. Member for Walsall, North (Mr. Hodgson) referred to clause 2(5). That provision does not cover the diplomatic services. The Bill applies to the United Kingdom public vaccination policy. The extension to the Forces takes into account special circumstances, but it would be to go beyond the Bill's stated purposes to cover the diplomatic services.
  The hon. Member for Reading, South referred to the residence test. That is not provided for in the Bill. It was included in the details given in my right hon. Friend's parliamentary reply on 2 August and in the leaflet. The Bill represents an improvement in the original proposals.
  In a few cases claimants were told that they would not qualify because of residence abroad. The House will be glad to know that such claims will now be processed.
  My hon. Friend the Member for Putney (Mr. Jenkins) asked about hormone pregnancy tests. I regret that, because of the long title, such tests could not come within the scope of the Bill. There is no real parallel with vaccine damage because there is no public policy programme for such tests.
  Mr. Robert Adley: I apologise for not being here throughout the debate. Can the Minister deal with the reduction in the numbers involved? He will be aware of

  85
  the grey area of whether certain children are covered by the Bill. Why has the number involved been reduced? Have the Government some information which has caused them to reduce the number.
  Mr. Morris: It is too early to give such detailed information. I shall write to the hon. Member as soon as possible.
  Mr. Hugh Jenkins: My hon. Friend says, rightly, that hormone pregnancy testing is outwith the long title. But there are certain parallels in the consequences felt by families who feel that their children are suffering because of hormone pregnancy testing.
  Do the Government recognise that this matter should become part of the general approach to disability? Are there any plans to give earlier priority to hormone pregnancy testing disability than to a general disability Bill?
  Mr. Morris: As my hon. Friend the Member for Stoke-on-Trent, South said, we are taking an entirely new step forward in social policy. I can give no definite commitment. However, my hon. Friend's remarks will be examined by my Department.
  The hon. Member for Birmingham, Stechford (Mr. MacKay) referred to a vaccine-damaged child who receives no other benefits than the attendance allowance. But that is a valuable form of help. There is also the mobility allowance which is paid to many thousands of handicapped children. As the hon. Member for Wells (Mr. Boscawen) said, there is also the family fund at York. I hold that fund in the highest regard and I shall examine the suggestion sympathetically.
  The right hon. Member for Wanstead and Woodford talked about legal aid. That matter requires further consideration. The legal aid scheme's rules are complex. It would not be advisable for me to be categoric since I might mislead the House. I shall be in touch with the right hon. Member.
  The Bill is the latest in a long series of contributions to the welfare of handicapped children that it has been possible to introduce over recent years. Both sides of the House have participated in examining constructively the measures that we have introduced, some of which have been large and others small. Essen-
  86
  tially, all that we have done starts from the premise that having a handicapped child imposes a severe strain upon a family and that the Government have a duty to improve services and cash benefits to reduce the burden on families.
  The first cash help was the attendance allowance which was originally proposed by Dick Crossman and put into effect by his successor as Secretary of State and which is now being paid to the families of about 47,000 severely handicapped children. There is now also the mobility allowance which is payable to children over the age of five who are unable, or virtually unable, to walk. In addition, there is the family fund, to which I have already referred. Service provision is also essential, and the aid and support that are given to families under section 2 of the Chronically Sick and Disabled Persons Act have been no less important than the provision of cash benefits in enabling handicapped children to remain with their families in the community.
  The Bill is the most recent contribution to helping severely handicapped children. Right hon. and hon. Members have made its importance clear, and I ask the House to give it a Second Reading.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Committee of the whole House.—[Mr. Tinn.]
  Committee tomorrow.

  VACCINE DAMAGE PAYMENTS [MONEY]
  Queen's Recommendation having been signified—
  Resolved,
  That, for the purposes of any Act of the present Session to provide for payments to be made out of public funds in cases where severe disablement occurs as a result of vaccination against certain diseases or of contact with a person who has been vaccinated against any of those diseases, it is expedient to authorise—
  (1) the payment out of moneys provided by Parliament of any expenditure incurred by the Secretary of State—

  (a) in making payments of £10,000 to or for the benefit of persons suffering such disablement, or to their personal representatives;

  87

  (b) in paying remuneration, travelling and other allowances to persons appointed to serve on tribunals under that Act;

  (c) in paying fees to medical practitioners who provide information or other evidence in connection with claims under that Act;

  (d) in paying travelling and other allowances—

  (i) to persons required under that Act to undergo medical examinations,

  (ii) to persons required to attend before tribunals under that Act, and

  (iii) to any person who accompanies a disabled person to such a medical examination or tribunal;

  (2) the payment out of moneys provided by Parliament of any increase in the administrative expenses of the Secretary of State attributable to that Act; and
  (3) the payment into the Consolidated Fund of any sums repaid to the Secretary of State by virtue of that Act.—[Mr. Tinn.]

  LANARKSHIRE AREA HEALTH BOARD
  Motion made, and Question proposed. That this House do now adjourn.—[Mr. Tinn.]
  6.31 p.m.
  Mr. George Robertson: At an unusual hour in the evening I wish to raise on the Adjournment the question of the Lanarkshire health board's ability to administer the area under its jurisdiction. A large number of people in the part of Lanarkshire that I and my right hon. Friend the Member for Lanark (Mrs. Hart) represent have serious misgivings about the ability of the health board in this respect. Our concern arises over two specific aspects. The first is the developing crisis at Stonehouse hospital. The second is the future provision of maternity facilities in Lanarkshire as a whole. I hope that this evening I can show that nothing less than a full inquiry is needed into the way that the health board has conducted itself on these two issues.
  Stonehouse hospital is a large general hospital situated in the village of Stonehouse. It has 435 beds and it is a fine general hospital with a good staff of high morale. It provides a full range of medical services and is situated close to the A74 and the M74. Up until last year it provided a full emergency service. It is a training hospital and it has one of the finest and newest ophthalmic units.
  88
  However, on 31 July last year the services of anaesthetists were withdrawn—temporarily, it was said—from the emergency services at Stonehouse, and no anaesthetic services are now available after 5 p.m. That has caused concern to many people, and it should worry everyone throughout the West of Scotland.
  Stonehouse hospital is now facing a massive rundown of facilities. This can inevitably lead only to a number of eventualities which the local population believe must end with the closure of the hospital.
  The first consideration is that Glasgow University will inevitably fail to recognise the pre-registration training of house officers in posts in Stonehouse hospital. The second consequence of a long-term shortage of anaesthetists will be that nurse training will cease to be recognised by the General Nursing Council. The third consequence has already occurred. The Royal College of Obstetricians and Gynaecologists has already withdrawn its recognition of Stonehouse hospital as a training centre.
  My right hon. Friend the Member for Lanark, my hon. Friend the Member for East Kilbride (Dr. Miller) and I all agree that this continued shortage of anaesthetists can serve only to jeopardise the long-term future of the hospital, thereby robbing that part of Lanarkshire of a major medical facility. Even now the consequence of having no emergency anaesthetic service is that ambulances pass by this fully equipped general hospital, taking emergency patients to Law hospital about 25 miles away.
  Ophthalmic patients, who could benefit from the most modern ophthalmic facilities at Stonehouse, are, after normal working hours, taken 22 miles away for treatment at hospitals in Glasgow. Few people would come to any conclusion other than than ultimately this hospital will close. The widespread concern expressed to all Members of Parliament in that area by the councils, the community councils, the local professional organisations and the local political parties shows that the assurances given so far are belied by the existing situation.
  But perhaps the most disturbing aspect of this alleged temporary withdrawal of emergency anaesthetic services must be the allegations now being made that people are dying as a result of being

  89
  transferred from Stonehouse hospital to Law hospital. Already two cases are being investigated by the Procurator Fiscal in Scotland, and it would not be proper for me to mention either of those cases in the House this evening. However, neither of the cases has been identified, and my right hon. Friend the Member for Lanark and I have had representations indicating that there is at least a possibility that other people have died as a result of being transferred.
  I have a statement signed by the senior consultant surgeon at Stonehouse in which he describes circumstances surrounding one patient. I believe it to be important to put this case before the House this evening. The surgeon writes:
  "I went to theatre to try to arrange operative treatment for her"
  —that is, the patient.
  "The gynaecology list had finished and the theatre was free. I spoke to … the Senior Consultant Anaesthetist from Law and told him the findings. He said that she sounded as if she needed operation. I thought he would have made some arrangement about her but he just left the theatre and hospital with no further word. When I found he had gone I 'phoned Dr. T. Fraser at Law Hospital and he said he would send the Duty Anaesthetists to see her. When I told"
  —the lady—
  "that she might have to be transferred to Law Hospital she was very upset and begged me not to send her. The Duty Anaesthetist … came to see her in the early afternoon and gave the ward staff the impression that she would have been willing to do"
  this lady at Stonehouse hospital
  "but that she had been told not to and accordingly had her transferred to Law Hospital."
  That was one of the patients who died. A senior and eminent surgeon is indicating that in his opinion that death would not have occurred if that individual had remained at Stonehouse hospital.
  Other cases have been quoted to us. The Procurator Fiscal is investigating, but how many more people have to die through being transferred from a fine hospital before urgent action is taken by the health board? I do not believe that enough is being done by the board. How many advertisements has it placed for anaesthetists in Lanarkshire? I am told that "precious few" is the answer. It is possible that there were only two advertisements in the medical press last
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  year. Why does not the board use locums? It is interesting that consultant anaesthetists are available outwith normal working hours at Stonehouse hospital to provide vasectomies—for a fee—to patients willing to attend in the evening. They are not available to provide emergency treatment for patients who might need it.
  I am told that anaesthetists from Law hospital are also available to do locum work at Bellshill maternity hospital, again during the night and again for a fee. Why is it that Lanarkshire area health board does not reorganise the anaesthetists' department at Law hospital to give to Stonehouse hospital the cover presently available at Bellshill, as is presently supplied to anyone needing a vasectomy after five o'clock? Why is it not possible for some emergency measures to be taken to provide this good, comprehensive district hospital with the standards required by the people of the area?
  I believe that the area health board is not doing its job and has not treated this matter with the urgency it deserves or with the urgency that the people of the catchment area of Stonehouse hospital feel that it should receive. The point is emphasised by the fact that a number of local organisations have written to ask for meetings with the health board. They have written to question the assurances given to my right hon. Friend the Member for Lanark and to my hon. Friend the Member for East Kilbride that there is no possibility of Stonehouse hospital being closed as a result of this supposed temporary shortage of anaesthetists.
  Hamilton district council, the authority most concerned, and in whose area the hospital is situated, has, apparently, been told that a meeting would serve no useful purpose. The community council, representing the whole catchment area of Stonehouse hospital, asked for a meeting through the East Kilbride and Hamilton local health council. It was told, as late as this week, that its request for a meeting would be considered by the Lanarkshire area health board at its next meeting—on 22 February.
  I suggest that that indicates the degree of urgency being shown by the Lanarkshire health board. Stonehouse hospital has a valuable contribution to make, not because of the 600 or 700 jobs that it

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  provides in the area but for the valuable medical facilities that it affords. We are not talking about a cottage hospital which has to be protected, nor are we talking about a medical facility which has, perhaps, outgrown the area in which it operates. We are talking about a facility which is apparently being starved of one of its most vital medical components, thus rendering it non-viable and thus making it a prospective candidate for closure.
  The people of Stonehouse and Larkhall, the people of Strathavon and the area served by Stonehouse hospital expect that a full inquiry will be made into the allegation that deaths have occurred and into the long-term future of the hospital.
  However, it is not just the maternity provision with which we are concerned. There is also a very important aspect affecting maternity provision in Lanarkshire. Recently in my constituency, the Lanarkshire area health board closed Beckford Lodge maternity hospital, which dealt with over 200 births during the past year. Yet during a year of maximum controversy, when the Lanarkshire health board closed that hospital, sending another 200 people this year to other maternity hospitals, the board's annual report published this year covering 1977–78 manages only three lines about the closure of Beckford Lodge. It manages not one line about where the extra births in Lanarkshire are to occur. This is at a time when Lanarkshire has the highest perinatal mortality rate in Scotland. In 1971, Lanarkshire had 27 deaths per thousand live births. Scotland had a figure of 25 perinatal deaths per thousand live births. In 1977, Lanarkshire had 25 perinatal deaths per thousand compared with an average in Scotland of 18 per thousand. This is an area with one of the best maternity hospitals and which is facing a potential increase in the birth rate from 7,567 in 1977 to 8,287 in 1980, and to 10,742 in 1984. Yet the area health board is saying nothing about future maternity provision for people in the area.
  Bellshill maternity hospital is now the location for most of the births in my constituency. With the closure of Beckford Lodge, the majority of births in my constituency and those surrounding it will
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  take place in Bellshill, which is the busiest maternity hospital in Scotland and possibly the busiest in Great Britain. It has more deliveries than any other hospital in Scotland and its ratio of 37 births per staffed bed per annum compares with 25 in the rest of the maternity hospitals in the West of Scotland. At the same time as that situation prevails, at a time when the area health board says nothing about long-term maternity provision, 51 beds have been closed for several years in Bellshill maternity hospital as a result of the shortage of midwives and a shortage, yet again, of anaesthetists. What is being done about it? What is being done to find out why midwives will not work at Bellshill? How much consultation has there been with the consultants there and with the unions? What is the area health board doing about the long-term future of anaesthetic cover?
  A letter from the consultants at Bellshill maternity hospital to the Social Services and Employment Sub-Committee of the Expenditure Committee of this House says:
  "Also the emergency/night time anaesthetic cover at Bellshill has been in the past shared with other hospitals, so that when the duty anaesthetist is called elsewhere, Bellshill maternity hospital has had no anaesthetist available. This has recently been responsible for about two perinatal deaths each year."
  Those are the words of the consultants. What is the Lanarkshire health board doing urgently to rectify this position?
  I ask the Minister to answer these questions. Why is there a lack of advertisements for anaesthetists throughout the whole of the area? Why is there no emergency temporary cover for Stone-house hospital, and why is not the same locum service being used as in the past? Why is the health board, apparently, postponing meetings with the people in the area, and why is it, apparently, making no reply to representations and suggestions from the medical staff in the hospital which would help to improve the situation? Why, at the end of the day, does not the board simply instruct the anaesthetists presently on the staff to do the job they were employed to do?
  Why has no study been made by the health board to find out why the hospital cannot get and keep midwives? Is it true that the shortage of anaesthetic cover is causing additional perinatal mortality? Why is there no mention of

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  long-term provision of maternity services, given the increasing birth rate mentioned in the area health board's annual report? Why, above all, has the board produced no reply following the assurance given by my hon. Friend the Under-Secretary of State for Health and Social Security in December last year to the effect that he would obtain from the board the reasons why long-term maternity provision was not mentioned? There must be an answer, and to get an answer I believe that we must have a full and open inquiry. How many other calamities must occur before this board will act?
  6.50 p.m.
  The Minister of State, Scottish Office (Mr. Gregor MacKenzie): I know that my hon. Friend the Under-Secretary of State would have wished to be here tonight to hear the cogent speech made by my hon. Friend the Member for Hamilton (Mr. Robertson). I know that my hon. Friend is most concerned about the health services in Lanarkshire and I am sure that my hon. Friend the Under-Secretary would have liked to have responded to him.
  I apologise on my own behalf in that, as my hon. Friend knows, this is not a subject with which I deal on a day-to-day basis. I shall certainly report the speech made by my hon. Friend to the Under-Secretary, along with other comments, private and public, made to me by my hon. Friend and my right hon. Friend the Member for Lanark (Mrs. Hart) recently.
  I stress to my right hon. Friend and my hon. Friend that the Under-Secretary has said that he is ready to pursue with the Lanarkshire health board those issues which have been raised and which justify further attention. I know that my hon. Friend will take up these matters as quickly as possible. That assurance has been given in recent days.
  I know that my hon. Friend the Under-Secretary would wish me to add that, while he will raise these matters with the health board, it is the Government's view that it would be wrong of Ministers to interfere too frequently. However, I accept that the points raised tonight are important. Before the reorganisation of local government in Scotland I had a much closer link with some of these problems. Many of the people whom I now
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  represent have certain services provided by Lanarkshire.
  It will be realised that many of the problems are not of the board's making. Lanarkshire was a new health area at the time of the 1974 reorganisation, in that hospital services had previously been administered by the Western regional hospital board. Traditionally, a significant part of the population had looked to Glasgow for acute services, although some long-stay beds located in Lanarkshire served, and still serve, a small part of the Glasgow population. Some steps to rationalise the services were already in hand in 1974—for example, the construction of the new Monklands district general hospital which is now in use—but others have still to be faced, such as the redeployment of psychiatric and geriatric beds. Another complication has arisen in recent years with the dramatic fall in the birth rate. One cannot overlook, either, the difficulties being encountered by the Health Service generally at present in recruiting the numbers of qualified staff—particularly nurses and the professions supplementary to medicine—it would like to have This is due not, I should emphasise, to lack of money but essentially to the non-availability of the required personnel. In this situation it is the areas such as Lanarkshire, which are not in a position to provide the same attractions as the major centres of medical training and specialised medicine, such as Glasgow, Edinburgh, Dundee and Aberdeen, which encounter greatest difficulty.
  I do not wish to suggest that Lanarkshire has insuperable problems—quite the reverse, because there have been substantial improvements in the area since 1974. The board's performance should, however, be assessed against this background of change and challenge. Within the short period of its existence the board has probably had to tackle more rationalisation of existing services—arising from the commissioning of the new Monklands hospital and the reduced demand for maternity facilities—than any other health board in Scotland. As we all know, changes which have an effect on existing facilities are prone to give rise to at least some concern, and often quite strong objections.
  My hon. Friend raised an important point when he talked about the question

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  of consultation. The best method of ensuring that proposals for change are properly understood is to make certain that there is adequate consultation about the various options and the factors which should influence decisions. My hon. Friend has suggested that sufficient consultation has not always been undertaken in Lanarkshire. I assure him that I shall raise this point with the Under-Secretary. I am certain that he will investigate the instances referred to by my hon. Friend.
  It is, however, often difficult to determine the appropriate time at which wideranging consultations should be put in hand because boards have, of necessity, to develop their ideas to some degree before proposals can be disseminated if the consultation is to be meaningful. This inevitably creates the impression that decisions have already been taken. Whatever my right hon. and hon. Friends may think, health boards have been advised that such consultation must be undertaken, not only when changes are imminent but at the earliest stages in planning when new facilities are envisaged.
  For example, Lanarkshire health board is planning a new district general hospital, to be built at Motherwell. It is required to develop proposals now for the effect which this will have on existing facilities such as Law and Stonehouse hospitals. Obviously, given the lengthy time scale for a new hospital of this size, any propositions now put forward and approved by the Secretary of State will have to be subject to reconsideration in the years ahead as technology advances and methods of treatments or patients' requirements change.
  I come now to the main point raised by my hon. Friend, namely, the adequacy of anaesthetist staffing in Lanarkshire health board's area and, in particular, the anaesthetic service currently available at Stonehouse hospital. Lanarkshire has encountered difficulty for some time in recruiting the number of anaesthetists it would like and which it considers necessary to provide an adequate service. It should be said, however, that since 1974 the number of consultant anaethetists in the area has risen from seven to 12.
  I am sure that my hon. Friend appreciates that the existence of a major teach-
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  ing centre nearby in Glasgow is an important factor. Despite what my hon. Friend has said, I am assured that continued efforts have been made by the Lanarkshire health board to recruit consultants. I understand that there are now two unfilled consultant anaesthetist posts in Lanarkshire. In addition, in the latter part of 1978, there was a temporary reduction in the number of experienced junior staff. It was this factor which precipitated the recent difficulties at Stonehouse hospital. Since the latter part of last year I understand that the situation among the anaesthetist staff has slightly improved and the number of junior staff in post is now up to establishment. The availability of these extra staff should help to ease the difficulties, but the health board is not able to say when full emergency cover will be restored at Stonehouse.
  The anaesthetist staff in Lanarkshire are organised into two main divisions—one, in the north, based at Monklands district general hospital, and the other in the south, based at Law hospital. The hospitals chiefly covered by the division at Law hospital are Law hospital, the William Smellie maternity hospital, and Stonehouse hospital. The division centred on Monklands covers this hospital and mainly Bellshill maternity hospital. The additional work load created by the new Monklands hospital could utilise all the increased manpower so far recruited. In this situation Lanarkshire health board has had the extremely difficult task of allocating the available staff to achieve the best possible cover for the area as a whole. In the southern division there are two acute hospitals, at Law and Stonehouse, and, with the shortage of consultant anaesthetists, the Lanarkshire health board had little option but to maintain full cover at one of these and accept that only more limited cover would be provided at the other. The health board has made arrangements for emergencies which would in the normal course of things have been admitted to Stone-house to be admitted to other hospitals.
  I can tell my hon. Friend that the chairman of the health board would not, nor would board members or senior officials in Lanarkshire, wish to see this arrangement continuing for any longer than necessary. I am told that they are

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  keeping up their efforts to recruit the additional suitably qualified staff.
  My hon. Friend has raised two or three cases of which he has heard when patients have died. I know that he will not want me to comment on these matters at present.
  I stress my opening remarks. These matters will be reported to the Under-Secretary, who is more than willing to raise these issues, about which he is as much concerned as my right hon. Friend and my hon. Friend.
  It being Seven o'clock, and leave having been given to move the Adjournment of the House under Standing Order No. 9 (Adjournment on specific and important matter that should have urgent consideration), further Proceeding stood postponed.

INDUSTRIAL SITUATION
Mr. Speaker: Before we begin the emergency debate, I should inform the House that, in addition to the application for the emergency debate which I granted, I had received notice of application under Standing Order No. 9 from the hon. Members for Richmond, Surrey (Sir A. Royle), Blackpool, South (Mr. Blaker), Chester-le-Street (Mr. Radice), Newcastle upon Tyne, North (Sir W. Elliott), Chelsea (Mr. Scott), Birmingham, Hall Green (Mr. Eyre) and Gosport (Mr. Viggers). I was grateful to all those hon. Members for not seeking to pursue their points of order once it was clear that I had granted the debate.
Secondly, I should like to inform the House that in this debate I shall seek to the utmost of my ability to ensure that every region in the country is covered. I shall try not to call two hon. Members from the same region until I have covered all the regions. It is a short debate, and therefore I ask hon. Members to bear in mind the fact that, if they are lucky enough to catch my eye, they can prevent another hon. Member from speaking if they go on for too long.
7.1 p.m.
Mr. Patrick Cormack: I beg to move, That this House do now adjourn.
Leave having been given this day under Standing Order No. 9 to discuss:
"The effects of the current industrial unrest in England, Scotland, Wales and Northern Ireland, and in particular the threats presented to the welfare of hospital patients and the disruption of local authority services."
Since I first applied for this debate last week, the situation, as one has come to call it, can be summed up in the immortal words of the Minister for Agriculture:
"There has been an improvement in the deterioration, if you see what I mean".
Although burials in Liverpool have resumed—and we are all thankful for that, at least—and although the immediate threat to London hospitals seems to have been lessened in some degree, a glance at this morning's provincial newspapers shows that we are still facing the mounting chaos which the Prime Minister dismissed as eyewash when he returned from Guadeloupe.
The Western Morning News put the matter as graphically as any when it said:
"Hospitals, schools, dustbins—gloom. Now water threat. South-West strikers to turn screws. The strikes crisis will get worse in the South-West this week."
It goes on to talk of the hospital situation, and so on.
One sees similar stories in The Scotsman and in the East Anglian Daily Times. I shall not quote from all those journals because, Mr. Speaker, you have given us all an injunction to be brief. I hope that hon. Members from the regions will be able to speak for themselves. But it is a sobering experience to look through the provincial newspapers in the Library. There are accident hospitals closed here, emergency facilities withdrawn there, no sterilised equipment beyond a period of 24 hours elsewhere. There is rubbish piling up in the streets, and threats from sewerage workers in the North-East who will not settle for 14 per cent. But underlining all this is the terrible threat to the nation's hospitals and to the Health Service. That is my main concern this evening and it is the subject to which I shall devote most of my remarks.
If one goes into the Library now and reads the London evening papers, one sees that, despite the late-night efforts of the Secretary of State for Social Services, for which we are all grateful, there is still a real and threatening crisis in London.
One sees that a 24-hour strike is threatened in a children's hospital beginning at midnight tonight. One also reads about the disruption of funerals and of mourning relatives being left with a body and no grave in which to put it. These are terrible, macabre stories and we should be thoroughly ashamed that they are happening in this country.
The Scotsman this morning carried the following reassuring headline:
"Callaghan steps in to stop the rot."
I wonder what that means. We also read in the same newspaper that the TUC leaders are due to go to Downing Street today. However, if something is to be done, the Prime Minister should turn to this House. I regret the fact that the right hon. Gentleman is not here, although one appreciates why. Therefore, I hope that the remarks we make in his absence
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will be duly reported to him. But the tragedy is that the Government have forsaken Parliament for their extra-parliamentary special relationship only to find that those upon whom they rely have no power on the ground. In a nutshell, that is what it is all about.
The Secretary of State for Social Services appears to understand what is happening. In a speech yesterday he is reported as saying:
"Enough is enough. Now that negotiations will be taking place this week, the time has come not for escalation but for de-escalation … A small minority have carried their activities beyond what their own trade union leadership accept as tolerable."
He bemoaned the fact that trade union leaders could not always deliver the goods.
Where has all the power gone? We shall not be persuaded later this week if another social contract is cobbled together. The power should reside in this House in a Government answerable to this House. The people should be able to look to Parliament to rely upon it and to believe that decisions taken here will be honoured and obeyed—until a new Parliament is elected.
It is no good relying on this spurious special relationship. It has been shown up to be totally phoney and hollow. It is still less useful for the Prime Minister to rely on a disunited party. Many Labour Members below the Gangway have given the right hon. Gentleman scant support in his efforts in recent months. The Prime Minister is like a eunuch attempting seduction. He is unlikely to succeed unless he comes to this House and asks us to restore his authority.
Mr. J. Enoch Powell: Not even then.
Mr. Cormack: The right hon. Gentleman says "Not even then." But I am a sanguine man, and perhaps one has to be. Perhaps I am a little more charitable than the right hon. Gentleman. Perhaps the iron has not entered quite so far into my soul.
If the Prime Minister does not wish to face the country in a general election, he must come to this House to ask us to assist him in governing the country. What we want is a response to the challenge, and not an explanation of impotence from the Dispatch Box. That is what we have

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had day after day from Minister after Minister in the last three ghastly weeks. Ministers have come, or have been summoned here, to answer private notice questions, but they have waffled and prevaricated and have given no clear lead or definite answers.
There are those in this country who are quite prepared to sink differences in seeking to reach agreement on those subjects that matter. In her speech three weeks ago, my right hon. Friend the Leader of the Opposition threw down a challenge, but she also made an offer which she repeated in a remarkable broadcast a few nights later. Answer came there not from the Prime Minister. Last week the Leader of the Liberal Party made a notable broadcast. One does not have to agree with everything he said to appreciate that at least he tried to be constructive. But again answer came there not from the other side.
In the current dispute, surely it should not be beyond the will and wit of Parliament to come to an agreement on certain basic issues. When we examine the public service dispute that is now taking place, we realise that there are few in this House who are other than ashamed and sickened by what they have read, seen and heard in the last couple of weeks. There should be no strikes in areas where people are at risk. They should not be tolerated. [HON. MEMBERS: "Should they be shot?"] They would certainly be shot behind the Iron Curtain, which certain hon. Members opposite seem to find so attractive. They talk of the Nirvana of Eastern Europe, and some of them even go to Cuba and wax eloquent about what goes on there. Yet they come to this House and lecture us about democracy. It is the Left-wing fellow travellers of the Labour Party who sit below the Gangway who are selling the country short and damaging our democracy—and all for a system in which there will be no freedom, no democracy and no strikes.
Mr. Neil Kinnock: On a point of order, Mr. Speaker. The hon. Member for Staffordshire, South-West (Mr. Cormack) is being as inaccurate as he is stupid—and that is saying something. However, there were phrases in the hon. Gentleman's remarks that transgress against the general custom of the
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House. I hope, Mr. Speaker, that you will draw them to his attention.
Mr. Speaker: I do not want the hon. Gentleman to recite to me what the phrases were. I thought that they were general phrases and were not directed to any individual. In this House many things are said that neither side likes.
Mr. Cormack: There are Labour Members who will willingly write in the Morning Star and address rallies of the Communist Party, and who will come back from good will visits to countries of Eastern Europe and tell us, with great eloquence and fervour, about the beauties and freedoms that they find there.
Mrs. Lena Jeger: On a point of order, Mr. Speaker, I did not understand that the relevance of Standing Order No. 9 included a recital of the politics of Eastern Europe.
Mr. Speaker: We are on the Adjournment and it is a very wide subject—as long as the hon. Gentleman is not asking for legislation.
Mr. Cormack: I was slightly provoked, Mr. Speaker, but I would say that it has everything to do with what we are discussing. Many of us on the Opposition Benches, and many people outside the House, can see that we are moving on a road towards an Eastern Europeantype State. What I am saying should be heard throughout this House and this country. Those Labour Members who hold up the countries of Eastern Europe as being their Nirvana must know that in those places there is no freedom—there is no freedom to strike, there is no freedom to disagree, and there is no freedom in the system such as we enjoy here. I shall not be provoked further. I believe that my remarks are entirely appropriate and in order.
Dealing with the present situation, what I am suggesting is that most hon. Members—in all parts of the House—are agreed on certain basic matters. It is a pity that the Prime Minister cannot come to the House and seek the support of those Members throughout the House—he would have to isolate some of his own Left wing—to enact those measures which will protect the freedoms of the democracy which most of us believe in and wish to see preserved.

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The right to strike is one of the most important and fundamental rights, but the right to work is equally important. What many of us are thoroughly sickened by—and the Prime Minister is one of those who is sickened by it—is the fact that striking has become the weapon of first and not of last resort. When sick people and corpses are used as pawns in industrial battles, we have sunk to a pretty low level. Today there are stories in every newspaper which should make every hon. Member sickened and ashamed.
I should like the Prime Minister to agree that these people—who are badly paid and deserve far more than 5 per cent., this rigid 5 per cent. that has been talked about so often—should be given a fair deal. There should be a proper review body set up for them. But in return the right to indiscriminate striking should not be theirs, any more than it is the right of the police or of the Armed Forces.
One of the tragedies of this Government is that the Prime Minister has alienated so many of those people upon whom we all depend. The police and the Armed Forces were seething with discontent before awards were made. It was too late. The Prime Minister has been guilty time and again of reacting and not anticipating. If he had only anticipated a little more, he could have foreseen this public service strike and done something about it.
Last year there was the same procedure with the firemen. Again, moderate people who would not normally go on strike were driven into the arms of militants because of the action of the Government. This has happened again and again.
Last week the Prime Minister came to the Dispatch Box, as he does every Tuesday and Thursday, and talked about picketing. He said that he would not hesitate to cross a picket line. He was called a scab and a blackleg for saying that by one of the hon. Members for Sheffield this morning. One expects that. But there is a great deal of agreement in the House of Commons on picketing and I should have thought that it would not have been beyond the wit and will of most Members to clarify the law which was made so obscure by the Attorney-
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General when he explained it to us recently.
The country has reached a desperate stage when a picket can say:
"I'd like to see what happened to him"—
this is, the Prime Minister—
"if he tried to cross this line. What James Callaghan says does not mean anything any more".
That is the tragedy of the situation. What the Prime Minister says does not mean anything to those militant hotheads who have taken command of their unions in so many instances.
We have seen this time and again, over the past few weeks, where codes of practice have been hammered out. I am not doubting the good faith of those who have agreed these codes of practice with the unions, but they have been flagrantly disregarded and disobeyed. We must put power back into the hands of responsible trade union leadership. That is what it is all about.
That is why it is so important to consider what my right hon. Friend the Leader of the Opposition has mentioned so often, the secret ballot. No one will pretend that a secret ballot will always produce the right answer—of course not. We shall frequently be disappointed. What are the trade union leaders so afraid of? They are desperate to see laws passed which oblige companies to disclose information but will not have their own rules opened to the slightest scrutiny. Decisions to strike should always follow a secret ballot, supervised impartially and counted without fear or favour. We must work towards that end.
Most hon. Members, in their hearts believe that to be so. There would seem now to be a unique opportunity for the Government to say "Yes, let us work together". If the Prime Minister will not go to the country now, he should use the few months between now and the general election to hammer out a consensus on those important issues of industrial relations, taking them out of party politics. Whoever wins the general election will then have a better bedrock from which to work.
Those are some of the sensible things which the Prime Minister could and should seek to do. However, I fear that he will not do so. These are areas where we should co-operate. There should not

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be any dispute between us about the basic ground rules of democracy in a free society. Yet, day after day, Ministers are unwilling to criticise because they are afraid that it might be said that they are union bashing. In fact, they are protecting the disloyal by not criticising, because the people who are causing most of the trouble at the moment in the Health Service and elsewhere are disloyal to their own unions.
The country is thoroughly perplexed. The Government have wavered over their incomes policy. Is it 5 per cent. now or 10 per cent.? It seemed to be 10 per cent. last night, but I see that that has been contradicted in this evening's newspapers. The Chancellor of the Exchequer has huffed and puffed and said that he could do what was necessary through taxation. We may well have to do so, but if he does it will be the responsible who suffer in the end and not the irresponsible. Those who settled earlier within the Government's guidelines will suffer most of all from whatever action the Government may subsequently take.
It seems to me that it is only this House of Commons which can really help the Prime Minister over the biggest hurdle of all if he is to overcome the consequences of his his own words in 1974, when he opened the floodgates to all this when he went down to Wales and said "A Labour Government will back your claim". There were many scathing references then and afterwards to the three-day week. If we go on as we are at present, we shall have a no-day week for increasing numbers of people.
Coming back to the Health Service and the Secretary of State who will at some stage intervene in this debate—I am very glad to see him here—fine words are not enough. The Government must be absolutely tough. If the current negotiations do not work out as the Government hope, the Secretary of State must make it quite plain that he, as Secretary of State, is responsible for the Health Service and its well-being, will not negotiate under duress and that there will be no question of sitting down at a table with people who are putting patients' lives at risk. That is vitally important. The stories that are coming in daily are dreadful.
There are problems in England, Scotland, Wales and Northern Ireland. That is why I enumerated each country separ-
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ately when I made my application this afternoon. Let us appeal to the Government to try to bring together all those, other than the dissidents, to hammer out a sensible code of industrial practice. It could be carried through this House—there is no question of that—and it would do inestimable good to the future of the country.
If the Government do not respond in a positive and sensible way this evening, I sincerely hope that all my right hon. and hon. Friends will express their disfavour in the Division. I hope too that hon. Members representing Scottish constituencies and the Scottish National Party will desist from supporting the Government as they have recently and show that they are as concerned about the true issues that affect their country and our country.
One has suspected that it has all been a case of waiting for 1 March. But their referendum is not at risk. Whether it takes place on 1 March or has to be postponed because of a general election, the fact is that it will take place. Neither of the major parties has put that at risk. What is at risk, however, is the fundamental freedom and democracy upon which any Assembly which might emerge, as well as the House of Commons, fundamentally depends.
Everything is at risk. I ask SNP members to recognise that when it comes to the vote, though I hope very much that this matter will not come to a vote, because I hope that we shall have a positive and a sensible response from the Secretary of State which will indicate that he is prepared to enlist the good will and support of all those, save a few hon. Members below the Gangway on the Labour Benches, who are really revolted and sickened by what has been going on.
7.20 p.m.
The Secretary of State for Social Services (Mr. David Ennals): I welcome this debate. That was why I rose to my feet earlier in the day when it was decided whether the debate should be held.
The hon. Member for Staffordshire, South-West (Mr. Cormack) has shown an interest only in exploiting for party political purposes a situation which causes grave concern. In all that he said, he showed very little concern for the National Health Service itself. I hope

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that he will not think me discourteous if I deal with the problems of the NHS.
I want to make this intervention early in the debate so that hon. Members can be fully informed of the extent of the troubles in the NHS. The industrial action of the hospital ancillary workers and ambulance men is causing serious disruption. But the situation has not been helped by many parts of the media, and, I regret to say, by some Opposition Members who have, in some cases, indulged in inflammatory exaggeration of the real state of affairs. I thought it right to intervene early on to set the record straight.
Between one-third and one-half of the hospital service—as I reported to the House last Thursday—is providing only essential and emergency services. Hospitals have been hit most seriously in the North of England. But much of the rest of the hospital service has been forced to restrict admissions to a lesser extent. In virtually the whole country, the ambulance service is providing cover for emergencies only. This in itself has restricted the number of patients admitted to hospital or conveyed for treatment. Non-urgent admissions to hospital have been cancelled by the thousands. Out-patient treatment has been equally disrupted. Experience has shown that each time there is industrial action in the Health Service waiting list, which we all acknowledge are already too long, increase yet again.
However, it is not true that ambulance men have left people to die. It is not true that emergency cases have been left untreated. It is not true that hundreds of hospitals have been closed.
The hon. Member for Reading, South (Dr. Vaughan)—I do not see him in his place now—said last week that 200 hospitals were closed. The figure is five. Also, a small number of day hospitals are shut.
But I take no satisfaction at all from the fact that many of our hospitals and most of our ambulance services are providing only essential and emergency services. An emergency service does nothing to help those who have been waiting for non-urgent operations. The operation may not be urgent, but the conditions from which these people suffer are often painful and debilitating. An emergency service does nothing for many of those waiting
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for out-patient appointments or needing treatment as day patients.
The results can only mean more delay, greater uncertainty, more frustration, discomfort and worry. Worse still, there is no clear line between essential services and those where delay will be harmless. Let me give two examples.
First, I mention laundries. In some areas there have been all-out strikes in hospital laundries, lasting a week or more—in Northampton, Nottingham and Lincolnshire, to give but three instances. Fortunately, most of the hospitals are able to cope.
My second example is blood donors. In many parts of the country, drivers and other workers in the blood transfusion service are banning overtime or working to rule. There is, I am happy to say, no immediate shortage of blood. But I am worried that we might lose blood donors who have had their sessions cancelled during this dispute.
These are some of the difficulties which we face and which we are tackling in a practical way all over the country. In spite of this, Opposition Members accuse Ministers of inaction. This charge was made on the radio this morning by the hon. Member for Reading, South—who is still not here. I listened to him with very great interest, because, while he and his right hon Friend the Member for Wanstead and Woodford (Mr. Jenkin) were tucked up in bed, I was engaged in all-night talks on the Westminster hospital group dispute. [An HON. MEMBER: "About time too."] The result of those talks is that 17 hospitals which would have been closed today are still in operation.
The problem at Westminster is just one example of the many local difficulties that exist across the country. I am certain that during this debate hon. Members will take their own examples. In most cases, as I have said, there has been some reduction in services. That is inevitable when industrial action is taken. That is why I deplore such action in the Health Service whenever it comes and from whomsoever it comes.
Several Hon. Members rose—
Mr. Ennals: But I have to remind Opposition Members that, although their shock and indignation make them feel

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better, that does not get patients treated and it does not resolve the dispute.
Mrs. Elaine Kellett-Bowman: I am particularly worried about the pile-up and hazard to health due to the closing of laundries. Can the right hon. Gentleman give the House any estimate of how long disposable supplies will last? My hospitals are now having to use disposable supplies, apart from what is provided by the few patients who can bring in their own sheets. Does he have any figures as to how long even these emergency disposable supplies will be available?
Mr. Ennals: The situation is causing concern in several hospitals. It varies from one hospital to another. Where there is a particular situation of grave concern, if we can help, apart from local management, we shall certainly do so. While industrial action continues, the Government and the health authorities are taking practical steps to preserve services to patients. I say "practical" to distinguish what we are doing from the hysterical and sometimes provocative approach adopted by some Opposition Members.
From the start of the present industrial action, the unions have made it clear that their members should maintain emergency services. They have since given more detailed advice, which has become known as the "code of conduct." I have welcomed this initiative. I applaud it again today. But I believe that it does not go far enough. I have raised with the union general secretaries a number of points of clarification which I shall be discussing with them again tomorrow. But, as a matter of practicality, if industrial action is under way we must do what we can to protect patients from its worst effects.
I am only too well aware that in some places local action has gone beyond the code. To me, that is a matter of great regret. But I think that Opposition Members should show some recognition of the responsibility shown by many members of the unions—including many who are taking limited action—and the very real efforts being made by the leaders and full-time officers of the unions to keep things under control.
Mr. Stephen Hastings (Mid-Bedfordshire): The right hon. Gentleman has
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made no mention yet of telephonic communication. Does he not agree that it is particularly dangerous for a hospital to refuse to connect the telephone? Is he aware that at Fairfield hospital, in my division, anyone who telephoned this morning was told without qualification that no calls would be connected? Will he look into this matter and see whether something can be done to relax it?
Mr. Ennals: There can be no justification whatsoever for action such as that. As hon. Members know, usually when there are problems such as this during this difficult period of industrial action, local management seeks to deal with them because they go beyond what is reasonable. Where a matter cannot be resolved locally, the hot line exists. Sometimes an approach to a regional officer of the union can help, but always we want to find a way in which we can resolve difficulties such as this.
Mr. Ian Lloyd: Will the Minister give way?
Mr. Ennals: I have given way.
For my part, I should like to pay tribute to the very many members of staff who are doing their best in difficult conditions to provide a decent service for patients. I saw something of this when I visited Queen Elizabeth hospital, Hackney, last week and when I visited Westminster hospital today.
I want also to recognise the way in which NHS managers are coping. They have very difficult decisions to make on how best to respond to industrial action and the problems that flow from it. The task of keeping the services going is not easy. To do it, the health authorities must have some flexibility. They must have room to exercise their own judgment in the light of the situation as they know it, and I have given them that flexibility. For the most part they are using it sensibly in the interests of the patients.
Mr. Ian Lloyd: The right hon. Gentleman has now used seven times the phrase "industrial action", to which many of us object. The phenomenon he is describing is "social obstruction". What aura of legitimacy or orthodoxy is he seeking to confer on this activity by describing it inaccurately as "industrial action"?
Mr. Ennals: The right hon. Member for Leeds, North-East (Sir K. Joseph), when he was Secretary of State for Social Services in 1973, used precisely the same term. I do not know to what extent the hon. Member for Havant and Waterloo (Mr. Lloyd) was leaping to his feet then, at a time when there was six weeks' industrial action by ancillaries in the NHS. The Conservatives were in power. It was nine days before the then Secretary of State came to the House and said a word about the industrial action that lasted for six weeks.
We must try to see how local management can be supported in dealing with the interests of patients, to preserve the service to patients. That is the task, not to prove the machismo to the wilder elements on the Tory Benches. That is why I have advised health authorities to deal with their difficulties by local discussion where they can. The union leaders have told me that their full-time officers are ready to be brought into discussions at local level when difficulties arise. I have advised health authorities to be ready to contact full-time officers of the union concerned, especially in cases where staff have taken or threaten to take industrial action which goes beyond the advice given by the union. Where that fails, I have, as I have pointed out, set up a hot line between my Department and the union headquarters to sort out cases where emergency or essential services are threatened.
Mr. Victor Goodhew: Is not the right hon. Gentleman aware that this is a medical service with which we are dealing? Who are the trade unions to decide what clinical decisions shall be taken, what is a real emergency and what is not? What does he mean when he says that unions are being consulted about this? Are they not exactly the wrong people to take the decisions? Should he not be taking his advice from his medical advisers?
Mr. Ennals: I made it clear that there are certain situations in which local organisers have gone beyond the code of conduct set up by their own unions. I have said that it is reasonable that local managers, when trying to deal with such situations, should try to deal through the union officers. I added that we have set up a hot line—there is nothing original
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about that. I notice that the right hon. Member for Leeds, North-East also said in 1973:
"There has been throughout some sort of hot line operating between my Department and the national headquarters, and I have paid tribute to the efforts of the unions."
I am doing the same as was done by the right hon. Gentleman, therefore.
I turn now to the question of volunteers. A large number of volunteers are at work helping to keep the hospital service going. Some are members of staff doing jobs normally done by others; some are voluntary workers who were assisting in hospitals in various ways long before this unfortunate dispute started; others are members of the public who have come forward to help during the present difficulties. Many of them are relatives of patients.
Hon. Members opposite have tried to create the impression that the Government are in some way opposed to volunteers coming to help. That is nonsense, and they know it. The Conservatives are trying to make political capital out of this tragic dispute and are ignoring the practicalities. Let me give a clear statement on the use of volunteers.
"We have taken the view that hospital authorities should not appeal for or employ volunteers as long as essential services are being maintained. The reason for this is that the unions have said that they will not keep to their undertaking to maintain essential services in the event of volunteers being employed. It is in the interests of the patients not to risk total disruption of the services.
"I have made it clear to the hospital authorities that if a safe level of essential services cannot be maintained in a hospital they will have to look to volunteers, but that before any such action is taken we put the position to the union."—[Official Report, 21 March 1973; Vol. 853, c. 459.]
Is that a fair and reasonable decision of policy?
Mr. Jonathan Aitken: Does not that quite extraordinary statement mean that the unions have a veto on whether volunteers come into the hospitals?
Mr. Ennals: The hon. Gentleman interrupted before I finished. The words I have delivered are not mine—they are the precise words used in the House during the 1973 ancillary workers' dispute by the right hon. Member for Leeds, North-East. Last week the Leader of the Opposition leaped to her feet, as did the right hon.

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Member for Wanstead and Woodford, when my right hon. Friend the Prime Minister was answering questions, demanding that we should make some great public appeal. They challenged the view taken by my right hon. Friend and myself that these are matters of judgment by local management.
Mr. Patrick Jenkin: I recognised where the quotation was coming from, but is not the right hon. Gentleman aware that, when my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) made that statement, some 9,000 ancillary workers were on strike—that is, about 5 per cent. of the total? About 300 hospitals were affected by strikes then, whereas well over half the 2,300 hospitals are now affected. My right hon. Friend said that there were nearly 30,000 beds out of use. That compares with the description that the right hon. Gentleman has given of what is happening now. Does not the right hon. Gentleman recognise that this situation is totally different?
Mr. Ennals: The way in which the right hon. Member for Wanstead and Woodford is wriggling is fascinating. I point out to him that in that dispute, about which we have heard so little from hon. Members opposite, over 1 million bed days were lost, thus adding over 100,000 to the waiting list. We have never since been able to catch up with that addition to the waiting list. It is sheer hypocrisy of the Leader of the Opposition and of the right hon. Gentleman to say that somehow or other the Prime Minister and I should be appealing for volunteers to rush their way to the hospitals regardless of the consequences.
The right hon. Gentleman rightly said in 1973 that these were matters that should be left for local judgment. Why should we take irresponsible action if it were to do more harm than good? I do not believe that the decisions about the National Health Service and local situations can be taken simply at the Elephant and Castle.
A set of general principles may be set out. Basically local people must make judgments about local situations. I absolutely endorse the words that I quoted from the speech of the right hon. Member for Leeds, North-East, who has not made any appearance in this debate. Neither
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has he dissociated himself from the position that the Opposition Front Bench have taken in the past 10 days.
Mr. Patrick Jenkin: If the right hon. Gentleman is going to make foolish comments such as that, where is his right hon. Friend the Minister of State? I gave notice that I intended to refer to him in this debate.
Mr. Ennals: Important discussions are proceeding. I do not think that it is necessarily to be expected that every Minister will sit here. That is all right for the Opposition. However, if the right hon. Gentleman wants to make any comments about my right hon. Friend the Minister of State, either the Minister of State or I will be perfectly able to deal with them.
We have seen a totally different point of view presented by the Conservative Party when they were in Government from the position they adopt now in Opposition—when, in a two-faced way, they sought to exploit a situation that affects the welfare of our fellow human beings.
I said that I welcomed the contribution that volunteers made. I am clear that where and when they should be used is a matter for local decision in the light of local circumstances. That is a practical approach.
Mr. Robin Corbett: Will my right hon. Friend make clear, in using the statement of the right hon. Member for Leeds, North-East (Sir K. Joseph), that that referred to extra volunteers? Secondly, will my right hon. Friend lay particular stress on the need for nothing to be done during this dispute involving volunteers which would in any way damage or disturb a relationship which it is important should continue long after this dispute is settled?
Mr. Ennals: Dealing with the second question first, this point was put to me during a long phone-in programme on this question in which I took part yesterday morning. I pointed out that the Health Service was run by all kinds of people working in our hospitals and clinics. When this industrial dispute is over—as I hope it soon will be—they will all need to work together in the interests of the Health Service. Anything that now seeks to increase division and create disruption and upset can do no good.

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I now refer to the first part of my hon. Friend's intervention. It is true that volunteers add enormously to the humanity, the family relationship and feeling that exists for patients in the hospitals. Nothing has been done by the trade unions or others to undermine that valuable role of volunteers in our hospitals.
The whole country is concerned about this dispute and the risks that it poses for patients. It is legitimate for right hon. and hon. Members on both sides of the House to express that concern.
When the right hon. Member for Wanstead and Woodford speaks, the House will judge his contribution to this debate by its practicality. What concrete proposals has he for settling the dispute? What figures does the right hon. Gentleman suggest for the pay rise? What is his party's policy for tackling inflation? How would he contain the industrial action? Those are questions that he never answers. I shall give the answers.
The crucial issue now is how we may arrive at a reasonable settlement of this pay dispute and get the Health Service fully operational again. I say "reasonable settlement" because the Government simply do not have the resources to pay whatever figure is demanded to end the dispute. There have been moments when it seemed to me that some people have simply said "Pay them the money". That is the easy way out. That does not make sense. That would result in leapfrogging pay deals pushing up the rate of inflation and leaving everyone worse off in the end.
What is a reasonable settlement? Some people have said that it should be the "going rate"—a new phrase that they use to mean a settlement equal to the biggest pay settlement they have read about in the newspapers. That is a recipe for disaster. There have been some large pay settlements in this pay round. But the idea that everyone is getting 15 per cent. or 20 per cent. —and that everyone must secure that kind of figure or be left behind—is simply not true. The big settlements are the exceptions and not the rule. When a group of employees settles for 5 per cent. or 8 per cent., including a productivity element, there is little or no publicity. There have
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been many settlements at that level. The average is still below 10 per cent.
I repeat to the local government workers, those in the National Health Service, the ancillary workers, the ambulance men and others, that everyone else is not doing so much better than is proposed for them. The Prime Minister spelt this out in Newcastle on Saturday. There is no such thing as a going rate of 15 per cent. or 20 per cent. Most settlements have been in single figures. It is important that they do not rise above that. That is why my right hon. Friend the Prime Minister made it clear that the Government were not prepared to finance settlements above single figures. If finance is not available, jobs must be lost.
Discussions between the management and staff sides have been taking place over the past week or so in an effort to find a basis for settlement. However, the Government believe that the time is right for a further three-pronged initiative to try to resolve this dispute and end the disruption in this vital public service.
First, I have invited the representatives of the National Health Service management to meet me tomorrow. The aim is to get substantive negotiations going again as quickly as possible against the background set out in my right hon. Friend's speech on Saturday—in particular, the Government's determination not to finance inflationary pay settlements.
Secondly, I am asking the unions to give these negotiations a chance to produce a workable settlement by giving the public a breathing space from industrial action. The unions have made their point. It is not in keeping with the service to prolong the risks to patients. It would be right for the unions now to suspend industrial action while talks take place. I hope that they will respond in a positive way to this appeal.
Thirdly, the Government intend to make rapid progress in setting up a pay comparability inquiry so that we may establish whether National Health Service ancillaries and ambulance men have fallen behind other workers in terms of comparable pay. If they have done so, we can begin to correct the situation next year. The comparability approach is a major step forward. It will help to ensure that Health Service workers are

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dealt with fairly in relation to others. These are practical proposals for resolving this tragic dispute: urgent negotiations for a single-figure settlement in this round, including a better deal for the low-paid, the early establishment on an agreed basis of a body to look into the comparability position, and suspension of industrial action while talks take place. I believe that that is the right way forward. It is in the interests of patients.
Mr. Norman Atkinson: Is my right hon. Friend saying that when the comparability test is understood and the ultimate settlement is made the outcome of those talks will be retrospective to coincide with the single-figure negotiations or settlement that he is talking about?
Mr. Ennals: No. I did not say that at all. I said that I thought that it was of extreme importance that, in their interests, those who work in the public service should now have a proper, established system of ensuring comparability between the work they do and the pay they receive for it and that of people working in the private sector.
I believe that the three points I have made point the right way forward. I believe that they are in the interests of patients, the staff concerned and the country as a whole.
Several Hon. Members rose—
Mr. Speaker: May I make a further appeal to the House. I shall not be able to call hon. Members from all the regions unless hon. Members are very brief.
7.51 p.m.
Mr. Graham Page: When, shortly before this debate started, I telephoned the administrator of my district health authority to ask him for an up-to-date report on the district, he gave me those details but wanted to fill them in after telephoning another area. He said "This may take me a little time as the telephone receptionist is taking emergency calls only." I thought that that was rather humorous until I thought it out.
All the hospitals in the North-West are on an emergency-only system, and the person who decides on the emergency is apparently the telephone receptionist—
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not a consultant, not a hospital registrar, not a ward sister, not even a probationary nurse. When we talk about the hospitals being on an emergency-only system, it sounds all right. The public may think "It's all right. They are dealing with emergencies." But that means that at least 30 per cent. of a hospital is inoperative. In the big hospitals 70 per cent. may be emergency cases. In other hospitals it may be much less, but the hospitals are inoperative to a substantial extent.
One finds similar problems when one inquires how many are on strike in a particular hospital. Let me take the example of the two large hospitals in my own district, Walton and Fazakerley. The only people on strike there are those in the central sterile supply department. That sounds fine. One thinks that the hospitals are entirely operative but for that department. But the modern hospital has no alternative sterilisation to the CSSD, and if that department is out of operation for a week it can bring the hospitals to a standstill.
In the north of my constituency the hospital transport drivers are on strike and the stores workers have put an embargo on the distribution of food or any other supplies from stores. If one inquires, one finds that the hospital is almost operative, except for those people. But if the food and all other hospital stores are not to be distributed to the hospital for a week, the hospital comes to a standstill.
The gravediggers and the crematorium assistants were a dramatic case which hit the public pretty hard. Incidentally, it is said that they are back at work, but they are not back at work in my constituency or in many other areas in the North-West. The Secretary of State has looked only at Liverpool, and even there, where he thought the men were going back last week, they are not back now. Last week those in the north of my constituency were on strike and bodies were not being buried or cremated. Those men went back, and now those in the south of my constituency are out. That is quite a dramatic strike.
What I fear is the danger that, where the strikes in a hospital are not quite so dramatic, the public will think that everything is all right, whereas actually we are being brought within a few days

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of the brink of disaster within the National Health Service.
In my view, the Prime Minister has made three major political blunders in dealing with the present crisis. They are past, present and future. In the past we failed to heed the warnings of the trade unions that they really intended to disrupt the services, not only in the hospital service but, as we saw before, in the supply services—the transport to the docks, and so on. He has shown the sort of foresight and preparation arising out of those warnings that an ostrich might show. He seems to have convinced himself that if he goes on repeating "Five per cent., 5 per cent. and no more" everything will be all right and that the trouble will fade away.
The Prime Minister should have realised in December, if not earlier, that the threats of the Transport and General Workers' Union, the National Union of Public Employees, the Confederation of Health Service Employees and the rest were really meant, that they really had to be taken seriously. Instead, he seems to have prided himself that by doing nothing about the tanker drivers' strike he got them back to work, that by doing nothing about the lorry drivers' strike he got them back to work—but at what sacrifice, what disaster for the country while they were out? Indeed, what a slap in the eye it was to his "5 per cent. and no more" policy. The right hon. Gentleman failed to heed those warnings.
There is no doubt that the Government would have been in a good position to negotiate before the strikes started if they had shown that they had really made preparations for the maintenance of essential supplies, that the Army was deployed and ready to take over essential services, and that voluntary help was organised.
It is my view that almost all those who have gone on strike were entitled to consideration of their claims, entitled to fair negotiation. But the negotiations are not fair if the Government have made no preparations at all for what should happen if those negotiations break down. That is my charge against the Prime Minister, that he has left us in the position of the people feeling that they are held to ransom, that the Government are not
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prepared for what to do in the case of a breakdown and that therefore there is no bargaining position.
So much for what I call the past blunder. That leads me on to the present blunder. By trade union leaders being allowed to make inflammatory speeches about disruption of services for the past two months before the strike started, little Frankenstein monsters were created which were quite out of the control of the unions. I refer to the strike committees, which have almost governed the North-West over the past three weeks. I suppose that the Prime Minister genuinely believed that he could shuffle off responsibility for any action if the trade union leaders concerned produced a code of conduct and told their members "Be good boys. Keep the rules. Play the game", and so on.
In the North-West it has become almost proverbial that the union members have not played the game according to those rules, particularly in my area on Merseyside. We have seen how that plea over codes of conduct has utterly failed. The lorry drivers' strike committees refused to allow goods to pass through, although those goods were specified in the code as being exempt from picketing. We have heard many stories. One that I recollect is that of certain ships' chandlers. Ships' stores were supposed to be exempt if they were being carried on to the ships. The ships' chandlers applied four times for dispensation for one particular load and when they wrote to me they told me that each time they applied they were told in unparliamentary language to something or other off.
In most cases, to apply for the dispensation took four hours—four hours sitting in front of a gentleman appointed by the strike committee to give the dispensation. That had to be repeated daily because the dispensation lasted only one day—the day on which it was dated. In the face of that failure of the code at the time of the lorry drivers' strike, we are now faced with a hospital code and with the Government relying upon a hospital code in order to save lives.
From the information that I have received about the North-West, I do not believe that that code is being any better observed than was the lorry drivers' code. This is an abdication of government. The Government are putting their faith

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in a voluntary code of conduct which it has been proved cannot be enforced by the unions on their members. That is surrendering government, not even to the trade unions but to the strike committees.
In the past the Prime Minister has failed to heed clear warnings of disruption ahead. In the present, for Government rule he has substituted trade union codes which are unenforceable. In the future, he now tells us that he is negotiating a new social contract. The previous thing called a "social contract" disappeared into thin air. Why does he think that the next one will have any greater success? After all, a social contract is a device for deciding outside Parliament the terms of legislation. To be a success, it must undermine the parliamentary process of legislation. But it will eventually disintegrate and we shall again be back in the same sort of crisis as we are facing now.
Surely it is time that this Government resigned, got out and let the electorate decide so that we can cease these continual crises under this Government.
8.2 p.m.
Mr. David Penhaligon: The situation with which we are faced is a total disgrace, and I do not believe that any hon. Member can deny that. The situation in Cornwall seems to be average to most other parts of the country. We have an ambulance service which will answer nothing but 999 calls. Apparently the 999 calls that are accepted are those relating to renal dialysis, radiotherapy and complaints in regard to which immediate curtailment of treatment could lead to possible death. That seems to be the general situation throughout the country. Patients seem to be served with meals and staff seem to be on the diet.
All three laundries in West Cornwall are on half steam, and we are told that on Wednesday two will shut down totally. In addition, on Thursday, in Barncoose and Tehidy hospitals, which on the whole deal with geriatrics in Cornwall, all ancillary workers will stop work. That seems to be the general situation that we face throughout the length and breadth of the country, and no expression other than "a disgrace" can describe it.
I should like to say a few words on the issue that we should be discussing, pay. That is what this is all about. We can
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be outraged at individual behaviour in hospitals—indeed, I am—but the issue that we must discuss is pay. Perhaps the House ought to concentrate its mind a little more on the issue which is the nub of this problem.
The dilemma we are facing is a traditional one—that of differentials as against low pay. In fact, one cannot kowtow to both arguments. The Conservative Opposition have made their position perfectly clear in the last 12 months. Given that argument, they are in favour of increased differentials. That is an argument which can be credibly presented, but one cannot argue for low pay at the same time.
Certainly the Liberal Party argues the low pay case. It would be interesting if the Government were to say which side of the argument they are on, because one can do nothing about low pay unless one is prepared to reduce differentials. The great irony of the present situation is that the people who have driven a coach and horses through the pay policy—the tanker and lorry drivers and the Ford workers—are, within this definition, among the well paid.
Mr. Kinnock: Rubbish.
Mr. Penhaligon: The hon. Gentleman says "Rubbish". I remember asking a series of parliamentary questions so that I could find out where MPs stood in the PAYE league of the well paid. I was amazed to discover that only 5 per cent. of the PAYE population in this country earns more than Members of Parliament. Therefore, if one really wishes to do something for the 56 per cent. of the population which earns less than the national average wage, it is no good looking at those who earn more than Members in order to resolve the problem. One has to look at the bulk of the population, which includes the fairly well paid, by which I mean £110 to £130 a week. That is the dilemma.
An hon. Member tries to represent both arguments, yet one cannot ride both horses at the same time. Either one can do something for the low paid or one can argue for differentials, but it is not a credible proposition to try to argue for both.
Of course, it is the Liberal Party's view that we should have a prices and

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incomes policy. We have stood for that for a long time. I sometimes think that my hon. Friend the Member for Cornwall, North (Mr. Pardoe) has stood for that argument in his own constituency nearly to the point of asking for his own extinction. But the Liberal Party has consistently fought hard for that for a long time.
The Government are now talking about the worst of all possibilities. I am quite prepared to defend a 5 per cent. norm in my constituency so long as it is adhered to. I suppose one could defend an absolute confetti money year in which everyone received 20 per cent. and we landed back where we started. But one cannot defend what the Government are now prophesying as their policy, which is 20 per cent. or 25 per cent. for some of the very powerful and about 10 per cent. for the very weak. That is a totally indefensible policy, and I do not know how Labour Members will be able to defend it to their own electorates at the next election.
Labour Members accuse the Conservative Opposition of exploiting the present situation. Of course they are. In the silly game of politics that we play, that is one of the things that happens. An adage of politics is "Never waste good agony". At the moment, there is plenty of good agony around, and the Conservative Opposition are certainly selling it to the people.
I am a relatively young Member of this House, but my experience is that in Opposition the Labour Party is a little better at exploiting good agony than is the Conservative Party. I regard the fact that they exploit it as obvious, and it is slightly hypocritical for the Labour Party to say that it would not do so if the situations were reversed.
Mr. Ennals: The hon. Gentleman may say that he is a very young Member, but he is becoming very experienced in the art of arguing in two directions at once. Is he about to explain the reason for his vote, and that of his party, against the Government's sanctions policy in order to retain some influence over settlements in the private sector? I look forward to an explanation.
Mr. Penhaligon: As I said, that is all part of the silly game of politics. The right hon. Gentleman knows why we voted
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against sanctions. Unfortunately, this House has not invented a third Lobby. There are times when about 40 hon. Members would love to go into it, because we do not like the silly game of politics that is being played. But a random sanctions pay policy, which is what the Government were propagating, is a non-starter, and the Government know that.
Frankly, even if the sanctions policy had been maintained, I do not believe that we would be in a situation very different from the present. The Secretary of State can pretend that it is all the fault of the Opposition. He might well be able to get away with that argument in Norwich, but he certainly could not get away with it in the West Country, where a little sanity on these issues prevails.
This House should be discussing pay. The situation is clearly a disaster. In Cornwall, because of low wages, anyone who works for the Government regards himself as well off and fortunate to be in a secure job. But even in Cornwall the dispute is as strong as anywhere else in the country. That is a condemnation of the pay policy or lack of pay policy that the Government have pursued over the past four or five years. The Government were elected on a "no pay policy" ticket. After 18 months they had to reverse it, but they have never put before the House a policy that could be voted on and approved. It must be a policy supported by all if we are to get over wage inflation. The Government now have their come-uppance. The Labour movement has clearly achieved power, but they have failed to face the dilemmas presented by that power. We cannot increase differentials and at the same time help the low paid. Which side of the argument does the Minister support?
8.10 p.m.
Mr. Giles Radice: The hon. Member for Staffordshire, South-West (Mr. Cormack), who opened the debate, quoted from the newspapers and the media. I was more impressed by his right hon. Friend the Member for Crosby (Mr. Page). He was quoting from direct knowledge. I was also impressed by what the hon. Member for Truro (Mr. Penhaligon) said.
I understand that the hon. Member for Staffordshire, South-West was endeavouring to appeal across party lines.

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It was an odd and partisan way to do that by pouring scorn on trade union leaders and many of my colleagues. It is all right for me to pour scorn on my colleagues but not for hon. Members opposite to do so, especially when they are trying to appeal across party lines. His appeal did not ring true. I believe, Mr. Speaker, that you said that he was speaking in general phrases. That is an apt summary. It was general phrases, no solutions. The cry that we have heard from the Opposition over the last four weeks is "Do something", but they have not said what.
Mr. John Stokes: Use the troops to start with.
Mr. Radice: I shall try to examine the issues, and I turn first to the problem of pay, like the hon. Member for Truro. The first cause of the dispute in the public sector is low pay. I declare my interest. I am a sponsored member of the General and Municipal Workers Union, many members of which are involved in the current dispute involving workers in the Health Service, water authorities and the local authorities. Other members are awaiting with great interest the outcome of the dispute, for example those in gas and electricity supply.
I believe that everybody in the House agrees that a considerable number of local authority and health ancillary workers are low paid, especially those who do not have the opportunity of earning overtime. Taking 1975 as the base date, the gap between the average earnings of local authority manual workers and the ancillary workers, on the one hand, and national average earnings, on the other, has quite clearly widened. In 1975 the average earnings of local authority manual workers were about 78 per cent. of the national average. Today it is about 75 per cent. Comparable figures for Health Service ancillary workers are 83 per cent. and 76 per cent. It is only fair to point out that 1975 was a good year for public sector pay. In the early seventies, the gap between the local authority manual workers and average earnings was wider than today.
Mr. F. A. Burden: If there are settlements of between 15 per cent. and 20 per cent. and the NUPE workers have a settlement at less than
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10 per cent., their comparative standard of living will be less than today.
Mr. Radice: I shall come to that point.
The second cause of the disputes is the distributional struggle between different groups of public service workers. Take the case of the ambulance men. Their earnings do not class them as low paid; they are about average. However, they have to do a considerable amount of overtime. But that is not the real problem. The real problem is that the firemen got a good deal last year, and the ambulance men want something like it this year. Similarly, the water supply workers want to be more closely attached to gas workers' earnings. One will always have these problems. Particular groups of workers want a special deal of one sort or another.
The third factor is the relationship between public sector pay and private sector pay. Taking the long-term view, one can see that since the early 1970s public sector pay has risen faster than that in the private sector. However, in the past two rounds there has been a slippage, particularly among some groups—though not the miners or the electricity supply workers, who have done well in every round. The reason for the slippage is incomes policy being applied more strictly to the public sector than to the private sector. Also, the norm has been expressed in percentage terms in the last two rounds. These are the underlying causes of the disputes and I draw two implications from them.
I believe that there should be a quick settlement of all the disputes. I deal particularly with the case of the local authority and Health Service workers. The Government's offer is a good one, let us make no mistake about that. It provides the £3·50 underpinning, a slight amount of extra money mentioned by the Prime Minister in his speech in Newcastle on Saturday, and, above all, the comparability studies, which are worth much more than the money on the table. If I worked in a local authority or in the Health Service, I would look at this very carefully.
An early settlement is in everyone's interests. It is in the interests of the community certainly, but it is also in the interests of the workers. It is not just a

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question of the loss of pay that occurs because people are out on dispute. If there is a quick settlement on the basis of the Government's offer, this will be very helpful. On the other hand, if there is a going rate which is uncertain and moving steadily upwards, this must be against the interests of local authority and Health Service workers. The longer the uncertainty continues, the worse for those involved in the strikes. If there is no quick settlement, other more powerful workers will use their muscle to ensure that a local government settlement is a first rung on the ladder upwards to new going rates, with the result that the local authority workers, far from improving their position, will be much worse off than before.
The time has come for the TUC to take the initiative. In early 1974 other affiliated unions said that they were prepared to hold back for the miners if that group were treated as a special case. Now the miners and electricity supply workers, local governement officers, teachers and doctors—who have just put in a large claim—should be prepared to say that they will not use the level of the settlement in the local authorities merely as a first step on the way to a higher level for them.
We have heard a lot about low pay in this House and outside. If people genuinely believe there is a problem of low pay, they should put their money where their mouths are.
There is no way that the serious problems with which we are concerned—low pay, the distributional struggle going on in the public sector, and the relationship between public sector and private sector pay—can be solved within the context of unrestrained collective bargaining. I accept that, in contrast with 1975–76, the pay rounds of 1976–77 and 1977–78 were not particularly helpful to the low paid, but that does not mean that unrestrained collective bargaining would have been better. In fact, it is likely to have been far worse. Under such a system, the rewards go to those with the greatest bargaining power, while the low paid, who are always the weakest, do worse and fall even further behind.
What we need to do is not to abandon an incomes policy but to ensure that an incomes policy always makes provision
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for the low paid, either through flat-rate increases, such as those that we had in 1975–76, or through exceptional treatment for low-paid workers.
Most people accept the case for comparability between the public and the private sectors, but that cannot be achieved without the support of some sort of incomes policy. Unrestrained collective bargaining is no help.
The distributional battles can be left to free collective bargaining if one likes, but at what cost to the community? It is surely much better to sort out these problems through the TUC public services committee, an extremely good innovation which hon. Members should warmly recommend, or, if that does not work, through an anomalies or relativities body on a voluntary basis.
All that has happened in the past three or four weeks has confirmed my belief that it is not possible to run a modern economy without some sort of permanent incomes policy. I only hope that the same message is getting through to those who espouse unrestrained collective bargaining. I hope that the chickens are coming home to roost for those on the Opposition Front Bench who have been espousing that cause in the past three or four years. [HON. MEMBERS: "It is the Government's chickens which are coming home to roost."] No. It is the Opposition's chickens. I know that Conservatives do not like facing facts. They find it unpleasant because it is much more difficult than talking in generalities.
Let us turn to another question that has been raised in the past week or so, namely, trade union power. Some Conservative Members, still smarting from the 1974 general election defeat which they wrongly thought was caused by the miners, have decided that they can get their own back on us and have not been able to resist saying "We told you so". But they have got it wrong. The history of 1974 shows that it was not the miners who beat the Conservatives, but the Conservatives themselves. They went for an election gamble on an anti-union ticket, and it did not come off.
If anything, recent events have shown that trade union organisation is by no means all powerful. Often it is too weak to persuade members to follow union policy. In addition, trade union power

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is of a blocking, negative sort. It can withdraw labour, picket docks and cold storage depots and shut cemeteries, hospitals and even schools, but, as we arrange things at present, it cannot help to create extra jobs or investment or new markets in the world.
I believe that the TUC must ensure that trade unions practise high standards. That is what the TUC is for. We must have high standards of practice in picketing, where there are closed shops, in relations between workers and trade unionists, and in trade union government. But we also now need a decisive move towards industrial democracy so that trade unionists are genuinely involved in all major industrial decisions.
Trade unions have obligations to each other. They have obligations to their industries or services. They have obligations to the community. That sense of obligation will be reinforced if they feel a real sense of commitment to that service or industry.
A number of prominent trade union leaders have recently said that we need a better way of doing things. We need to find a better way to deal with pay negotiations, for the low paid as well as the better off, and for the private as well as the public sector. There is a strong case for annual tripartite discussions on inflation targets and more synchronisation of pay claims. We must have some way of dealing with relativities and anomalies.
But as well as our concern with those immediate problems we must not forget the crucial need, if our industries and services are to recover and prosper, for a real involvement by employees in the running of their industries and services.
8.27 p.m.
Mr. Kenneth Baker: The hon. Member for Chester-le-Street (Mr. Radice) referred to the winter of 1973–74 and said that the then Conservative Government were defeated by themselves. That was not quite the sequence of events that I recall. What I do recall about that winter—which is different from this winter—is that in the wage bargaining round between 6 million and 7 million people had accepted the third phase of the Conservative Government's pay policy. At this stage of the negotiations, fewer than
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1½ million people, including the public and private sector workers, have accepted the policy. That is a small number compared with those involved in settlements in the winter of 1973–74.
Today's debate stands in the shadow of two failures. It is a sad and malancholy debate. We are debating once again the breakdown of our health services. I remember a similar debate in 1974. It was then a matter for censure and regret, as it is tonight, because human suffering was involved.
We are discussing a political failure and a social failure. The political failure rightly can be laid at the door of this Government. The seeds of that political failure were sown in the autumn of last year when some Ministers thought that they could get away with a 5 per cent. limit on wages this winter.
One would not have had to step far away from the Elephant and Castle to realise that that policy was never a runner. How could one say to the mass of working people in both private and public sectors that 5 per cent. was the going rate when inflation was running at 7 per cent.? Everyone involved knows that after tax a 5 per cent. limit really means a 3 per cent. or 3½ per cent. rise.
The political failure was compounded by a slow surrender. A fortnight ago Ministers in the Department of the Environment let it be known that 8.8 per cent. was a negotiable figure. At Newcastle on Friday afternoon the Prime Minister said that we could go to the limit of single figures. The Secretary of State for Social Services was the first to pounce upon that. He said that that meant 9·9 per cent. I interpret what the Secretary of State said then and tonight as meaning that the limit is 9·9 per cent.
That is the political failure of the Government. They began unrealistically and they have had to retreat. They have lacked authority. The Secretary of State has added to that lack of authority. In all his ministerial statements he conveys an aura of limpness. If he says "It will not happen; it is unacceptable", it is a racing certainty that it wil happen and that it is about to be accepted. The Government can be condemned for that political failure.
Mr. Ennals: Presumably the hon. Member, having criticised the Government, plans to say what his pay policy is. I should be most interested to hear it.
Mr. Baker: I was about to conclude my analysis. I shall do that and then I shall come to my suggestions.
Perhaps the Minister will reiterate what his pay policy is for Health Service workers. His authority was totally undermined when he was interrupted by his hon. Friend the Member for Tottenham (Mr. Atkinson) during his statement on his three points. The hon. Member for Tottenham said "It is not acceptable". That underlines the decay of the Government's political authority.
The Government's second failure is a social failure. That goes much deeper than the political failure and the failure of Ministers. It is deeply regrettable that groups of workers are, for whatever reason, prepared to withdraw their labour even if that means that other people suffer. That has happened with growing regularity during this decade. It was not a characteristic of industrial disputes in this country before the 1970s. It is a measure of the impatience and the sense of injustice now felt by groups in our society that they should be prepared to do so. That social failure has very much deeper causes and requires much more fundamental changes to deal with it.
The Secretary of State gave the impression that the position in London was markedly better. It is fair to say that in parts of London it is no worse. The strike that was threatened today for the hospitals in South Westminster has not taken place, and the position is better. In North Westminster the hospitals to which my constituents would turn face a worsening situation. The hospital at Praed Street and the hospital in Harrow Road, which most of my constituents would use, have been the subject of effective picketing.
No volunteers have been allowed into Praed Street today. The hospital is accepting emergencies only. At Harrow Road all the ancillary workers are out and the pickets are on duty. Some 60 volunteers got into the hospital, but I believe that that was unofficial. Tonight we are threatened with the closure of the children's hospital in the same group.
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An emergencies-only service, as the Secretary of State was prepared to recognise, is totally inadequate, particularly for central London. A high proportion of my constituents are elderly. Anybody who represents a city centre seat recognises that the proportion of elderly people in it is much higher than the national average. They call upon the services of the hospitals much more than the younger people. They may not fall into the emergency category, but many of them should still be going to hospital regularly.
The Secretary of State said that waiting lists lengthen. Of course they do, and that means that the old people who are waiting for treatment get put off repeatedly.
The result of all this is that morale in the Health Service today is as low as at any time since 1948. Most Health Service workers want to get on with the job. In London the situation is exacerbated by the fact that we have to put up with the Resource Allocation Working Party. For central London and, I dare say, for the area of the hon. Member for Tottenham, that means simply that there is less money to go round. That makes matters a great deal worse. If the Government are trying to exercise an incomes policy in a period of restraint and restriction while trying to cut services, they are on to a non-starter from the beginning.
The Secretary of State asked what I would recommend. I suggest two things. The first concerns volunteers. The right hon. Gentleman should change his tone about volunteers. I heard the Minister on television or radio over the weekend. He almost said, though not quite, that volunteers were blacklegs. That was the implication of the way that he answered a question on that programme. He said almost the same this afternoon when he suggested that volunteers exacerbated the situation. Most people in this country believe that it is the pickets who are exacerbating the situation.
I do not press him very hard for a clarion call for volunteers, but I believe that his tone concerning volunteers should be changed. St. Mary's hospital, in Harrow Road, would not have operated this afternoon but for 60 volunteers. Is there not a word of thanks to those volunteers from the man who is responsible

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for the Health Service? Would the Minister like to thank those 60 volunteers?
Mr. Ennals: I think that if the hon. Gentleman had listened to the programme in which I took part yesterday he would have heard me express great thanks for the way in which volunteers are providing a service to our hospitals. I said that there had been occasions now and previously when volunteers had made a great contribution. I have no doubt that if I issued an appeal there would be thousands of volunteers wanting to plunge in and help. I ask the hon. Gentleman, does he not agree with the advice given in 1973—which is just as sound today as it was then? If we allow volunteers to pour in and that disrupts the situation, is it a wise thing to do? Does he not believe that this is something best left to local management?
Mr. Baker: I thank the Secretary of State for his thanks to those 60 volunteers at St. Mary's hospital, Harrow Road. I am not suggesting that he should issue a clarion call for volunteers to rush in. He should, however, go out of his way to thank and encourage volunteers where they are allowed into hospitals. In his negotiations with the unions tomorrow, the Minister ought to make it the major point that he wants to see them encouraging volunteers to go in. That is what leadership is all about. It is not about quoting what was said in this House tu quoque five or six years ago.
The right hon. Gentleman asked me what I would do. Perhaps it is starry-eyed of me, but I should like to see strikes in essential services becoming a thing of the past. I am realistic enough to know what happens if we withdraw the fundamental right to strike from a group of workers. We found, when in office, that it was exactly the reverse of the desired objective when we allowed public sector workers the right to strike —something which they had not had previously. We should ask whether certain key groups of workers should get certain guarantees on the lines of guaranteed relativities if they are prepared to surrender their right to strike.
I favour a series of relativity exercises for the public sector because I can see no other way in which we can satisfy
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the anxieties of the workers about being left behind. I believe that this possibility should be urgently examined to see whether we could persuade these very low-paid workers that they will not be left behind. The situation is made much worse by the fact that we are emerging from a period of pay restraint and the people we are talking about think that they have been left behind in the race.
I believe that that is the way forward. It is not an easy way. It is a very hard way, but I believe that that way has been made all the more difficult by the political failure of this Government during negotiations. They began unrealistically and this has led to the present chaos.
Several Hon. Members rose—
Mr. Speaker: Order. May I tell the House that there is less than an hour for all the hon. Members who wish to speak?
8.39 p.m.
Mr. Terry Walker: It is sad that once again we have to discuss this problem. The hon. Member for Staffordshire, South-West (Mr. Cormack), who opened the debate, drew attention to the problems currently facing the National Health Service. It is right that we should be discussing this matter, but I think that by pursuing the party line, which he did by attacking the Prime Minister and other Ministers, the hon. Member was emphasising the attitudes among Opposition Members and candidates throughout the country, without providing an answer to the problems facing the Government. I am sure that the House is grateful to the Secretary of State for the action which he has taken in the past 24 hours. He has taken a practical approach to the problems confronting us. That approach is necessary.
Tory Members have called on the Government to resign. That would not solve the problem. We would still be faced with the difficulty of knowing what to do with the Health Service. Tory Members with any memory will recall that not so long ago they had similar problems. My right, hon. Friends must understand, however, that there are serious reservations about the Government's policy towards low-paid workers in local government and the Health Service. Many of us believe

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that such workers need a substantial increase to give them a better deal. Recalling the ease with which the BBC employees had their claim met, we cannot help wondering whether watching television is more important than maintaining essential services. When we listen to the BBC moralising on present problems, we cannot help but wonder what happened which allowed that claim to go through in 24 hours. Why did my right hon. Friends, and indeed Conservative Members, say nothing about it?
Industrial action is now being taken in local government and in the Health Service by those who have seen what has happened to the BBC staff. They have seen this leapfrogging while they have remained on low wages. What has been proved by these workers taking their present action—regrettable though it is—is that they are essential workers. Yet we are prepared to accept the fact that they do not receive a living wage.
Tory Members have been quick to condemn this industrial action. However, we have seen industrial action practised by the hospital consultants for a long time. My right hon. Friend has spoken of this frequently. We have not had the support of Opposition Members in dealing with that type of industrial action. We want social justice. To achieve it there must be a substantial pay increase for those in local government and in the Health Service. They have proved that their jobs are indeed essential.
We have heard the hypocrisy put forward in the House about the chaos which would be caused in the country. My right hon. Friends have heard repeated calls for states of emergency to be declared, first in connection with the tanker drivers' strike and then the hauliers' strike. What would have happened if the Government had been trigger-happy and had rushed in? What was behind all this? The Opposition were not really interested in solving the disputes. They were interested in creating greater chaos. If we had moved in the troops to deal with the tanker drivers, or the hauliers, other workers would have gone out on strike and there would have been utter chaos. My right hon. Friends have been right to resist the calls for states of
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emergency. Happily, we have overcome some of the disputes.
The question of volunteers within the Health Service has been raised and will no doubt occur again in the debate. The role of volunteers is vital within the Health Service. There will always be a need for them. That being so, it would be most difficult if the role of the volunteers were to be brought into disrepute because of something that happened in the present situation. Therefore, my right hon. Friend is right. We must ensure that these matters are negotiated—and what is wrong with that?
The role of the media has been a bad one throughout these disputes. The irresponsible way in which they have acted has highlighted our difficulties. Friends abroad who have read British newspapers have telephoned people in the United Kingdom to ask whether they could send food parcels. What is patriotic in that kind of nonsense that appears in our newspapers? The newspapers and television have painted a picture of gloom and despondency. I believe that we should deal with these claims as a matter of social justice.
There has been much union-bashing from the Opposition Benches. However, for a period of three years the trade union movement has co-operated with the Government in maintaining an incomes policy. I have not heard many Tories paying tribute to the unions on that score, but that is what has happened.
We have now reached phase 4, and that phase has not been recognised by our friends in the TUC. The unions have undoubtedly made sacrifices, and that certainly applies to low-paid workers whose lot has become worse year by year. Therefore, the Government are right to return to discussions with the TUC in an effort to reach some agreement. Great efforts are now being made by the Government to that end, because that is the only way in which we shall overcome the present difficulties.
Labour is the party of negotiation. On the other hand, the Conservatives have proved themselves to be the party of confrontation. In the meantime, we must recognise the claims of the low paid in local government and in the NHS. For too long those workers have been allowed by successive Governments to lag behind

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to the detriment of themselves and their families. My right hon. Friend has announced that tomorrow he will negotiate on pay comparability, and the whole House will wish him well. It is vital that the present position is resolved.
8.47 p.m.
Sir William Elliott: I shall do my best to adhere to Mr. Speaker's ruling and keep my remarks short. Therefore, I shall resist the strong temptation to take up some of the comments of the hon. Member for Kingswood (Mr. Walker). However, I must deal with his closing words in which he suggested that the Conservatives were the party of confrontation. Who at the moment is confronting whom? Are not the workers who are now on strike confronting the Labour Government?
The hon. Gentleman is wearing rose-tinted spectacles if he seeks to blame the media for exaggerating situations which I believe are the worst that I have experienced since I have been a Member of this House. The Secretary of State for Social Services asked about the Conservatives' answer to inflation. Those of us who listened to an American economist speaking on the radio this morning do not have to be asked that question. He suggested, as every sensible person would agree, that all our problems flow from lack of productivity. The present Government have failed in that regard.
One of these days I shall see a wage claim that is presented asking for a percentage increase but not seeking a shorter working week. What a pleasant change that would make in seeking to solve the basic problem that besets the Health Service and everywhere else—namely, the basic problem of productivity. It would be refreshing to have the suggestion of a wage increase, but with added rather than fewer hours.
I am extremely grateful to be called in this debate because it is an emergency debate. I believe it is the duty of us all to make quite clear how serious a problem the present industrial action in the Health Service is—and elsewhere in those parts of the country we represent.
During the past weekend the Secretary of State visited Newcastle, as did the Prime Minister and the Secretary of State for Transport. They addressed a confer
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ence at Newcastle, to which I was not invited. It was a party conference and I fully understood that omission. However, whilst the conference was progressing in our civic centre, I spent my time, as the only Conservative Member for the city of Newcastle—that is a temporary embarrassment, I assure the Secretary of State—touring the city streets. I should never have believed that I could have seen such sights as I saw this past weekend. Refuse proliferates. Plastic refuse bags had burst open in the back streets. Dogs roamed the lanes. The health hazard is enormous. In the civic centre the Secretary of State for Transport was saying that he feared that Labour's electoral chances had declined. Yet in several speeches in this debate this evening we, the Conservatives, have been accused of making this situation a political issue.
It is right that this debate should take place today. It is far more important that the health of our people and the well-being and health of patients in our hospitals should be considered, rather than the electoral chances of the Labour Party at a conference in Newcastle or anywhere else.
It is my desire to bring to the attention of the House the crisis facing the hospital service in the Newcastle area because it is a very extreme crisis. I suggest to the hon. Member for Kingswood that the situation is very serious indeed. The latest report issued today by a consultant at the Queen Elizabeth hospital in Gateshead—which is not far from the constituency of the hon. Member for Chester-le-Street (Mr. Radice), who has spoken in this debate—said:
"supplies of sterile equipment for emergency operations will dry up within 48 hours because of an indefinite strike by 12 women in the central sterile supply department."
The consultant, Dr. Vickers, is on record as saying:
"If treatments are not carried out at the right time then some patients will suffer and some may die."
What was the response to this serious statement? Mr. Arthur Caley, general administrator for the Gateshead health authority, said:
"This is very serious and it is a disturbing development. The union will object if any other grade of staff or any volunteers are used."
I ask the Secretary of State to take this warning from a senior consultant in the

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Tyneside area very seriously indeed in his general attitude to volunteers. I appeal from this House to the 12 women concerned in that particular department to return to work at the earliest possible moment, in the interests of humanity.
To some degree the crisis in Newcastle's hospitals can be estimated in approximate figures. Again, they illustrate the seriousness of the present situation. In the last two weeks 1,600 outpatients in two hospitals have had appointments postponed, and 1,750 cases for treatment have had their treatment postponed. The number of in-patient entries cancelled in the past two weeks is 300.
The Secretary of State referred to the number of hospitals which had been closed in the past two weeks. I should point out to him that in my area—and, I am sure, in others—sections of hospitals have been closed, which is just as serious.
Mr. Patrick Jenkin: Does my hon. Friend realise that the Secretary of State seriously misled the House when he referred to what had been said by my hon. Friend the Member for Reading, South (Dr. Vaughan)? My hon. Friend for Reading, South referred to 200 hospitals closed or partly closed and the Secretary of State never referred to the words "or partly closed".
Sir W. Elliott: I am very grateful to my right hon. Friend. My hon. Friend the Member for Reading, South (Dr. Vaughan) was absolutely right. It is not just in the Newcastle upon Tyne area, to which I am particularly anxious to refer. I have read of partial closures elsewhere. However, the hard facts with regard to Newcastle are that six wards in critical areas of hospitals. including one children's ward, have been closed in the last two weeks. No one should underestimate the effects of this general holdup. How many cases which are near emergency will become fully so within the next two weeks? I rather think quite a substantial number.
Newcastle upon Tyne, as the Secretary of State well knows and has acknowledged in the House on a previous occasion, has an appallingly long surgical waiting list. It will be made even longer for a great deal of time to come because
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of the present stoppage. It is salutary indeed to attempt to estimate in terms of pain what the effect of strike action will be throughout the country as a whole and my city in particular.
Our hospitals keep going at present—I think that the Secretary of State was quite fair in this section of his speech—certainly in Newcastle, because of the dedication of certain sections of people within the hospital service. The nursing profession is strained to the utmost. I had considerable evidence of that during the past weekend. So are the administration staff, who are doing a very good job and performing many tasks which are outside the bounds of their normal work. I pay tribute to both bodies.
However, I think that one should warn the Secretary of State and the Government, and certainly the House, that, if this dispute continues, breaking point for the nursing profession—indeed, that profession, nationally, has issued a warning about this—will not be not very far away. Certainly those who are administering the hospital services are in some cases quite near breaking point, too.
I should like to quote from a letter that I received today from a senior official of the hospital service in Newcastle upon Tyne. The sentence is simple but very important:
"We cannot go on like this much longer."
So far, I gather that the unions are honouring their pledge to remove from Newcastle's hospitals infectious waste, but it is just as certain that other forms of waste are not being removed. I have it on skilled authority that non-infectious waste can quickly become infectious, and, indeed, without its becoming infectious it is an extremely high vermin risk and a very high fire risk.
In Newcastle, as elsewhere, there is no shortage of offers of voluntary help. It has been suggested from both the Labour Front Bench and the Labour Back Benches that we should not exacerbate the strike situation by allowing volunteers to come in. In the name of maintaining central services threatened if voluntary help is accepted, area officials in Newcastle upon Tyne have agreed not to accept volunteers as yet. But co-operation must be two-sided. Breaking point is near.

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In what I hope is a short intervention, I wish to say only this to the Government. Area officials are honouring the so-called code. I believe, and so do many of them, and so does the Secretary of State, that its terms are inadequate. They are inadequate to ensure a minimum emergency service in our hospitals. Secondly, with regard to those in our hospitals who do not observe the code, hospital authorities should not hesitate, with the backing of the Government, to send them home. The wreckers within the trade union movement must not win the day—and they exist in Newcastle as in other areas.
The most critical area with regard to services in Newcastle—I am sure that this applies to the country as a whole—is that of the laundry service. It was very distressing to hear of the announcement on Friday that there would be, from today, a ban on the treatment of dirty linen in Newcastle's hospitals. When I point out that one of the Newcastle area's hospitals is a very large psychiatric hospital, one cannot underestimate the seriousness of that statement.
I am happy to report that my latest information is that, after long negotiation today, it has been agreed that dirty linen will be treated in certain hospitals, including the psychiatric hospital and the children's hospital. But the problem of linen remains acute. Cleanliness to a safe hygienic level must be maintained, and if it were to fall below tolerable levels we should be running into health problems of enormous magnitude. Refuse of all kinds must, under the code, be removed from all our hospitals.
If a revised code—and that is what I am asking for this evening—is to be brought into being, it should include such provisions. If these guarantees are not forthcoming, the Government must not capitulate; they must stand firm and bring in contractors and volunteers. It is firm Government action that is required at the moment, not the mixture of pleas and bullying which emerged from the Labour Party's local government conference in the civic centre at Newcastle over the weekend.
Gone for ever is the fallacy that only with a Labour Government can there be industrial peace. Never in modern times —and it is with a Labour Government—
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has there been greater industrial unrest in the area I represent. It can be no better summarised than by a letter from a constituent whose children attend West Jesmond school, which has been closed by industrial action. It says:
"We are desperate to save our children from learning little else but how to take industrial action. Is it possible that you could help in any way and make our feelings known to those who could make some efforts to resolve the present disputes?"
That effort I have made today, and I hope that note has been taken.
Several Hon. Members rose—
Mr. Speaker: Order. This is the last time I will appeal to the House, because I had been hoping to call from both sides of the House someone from Wales and Scotland as well as from London. That is still possible, but only if we have six-minute speeches.
9.3 p.m.
Mr. Norman Atkinson: It has already been said that the debate is about wage bargaining in the public sector, and it is towards that end that I wish to address my comments. I want to follow, too, my hon. Friends who have expressed the point of view—against the views of the TUC—that there is growing opinion in support of the reintroduction of a fixed incomes policy. The debate is also about relativities and comparabilities, and about a method of relating income in the public sector with the outcome of wage bargaining in the company sector.
The hon. Member for Staffordshire, South-West (Mr. Cormack) attacked the views which have been expressed over the weekend about the general principle in this matter. The Tory Party has now clearly established that it intends, as the right hon. and learned Member for Surrey, East (Sir G. Howe) said at the weekend, to
"tilt the balance of power away from the trade unions."
I think that it is demonstrated that it is commonly agreed in the Tory Party that that must be one of its major objectives.
The second thing that the Tory Party has said is that, given the opportunity, it would cut public spending. If public spending were cut, it follows that there would be an additional strain upon wage bargaining in the public sector, because there would be an enormous compression

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which must restrict the agreements ultimately made.
I want to relate all those remarks to what my right hon. Friend the Secretary of State for Social Services has said in his negotiating position, offering a maximum, at this stage at any rate, of about 9·9 per cent. increase and comparability at some later stage, some time in the future, when a method can be agreed as to how it can be done, in order to adjust the differences that have appeared between public sector earnings and company sector earnings. I said that that was not on. The trade union leaders representing the four unions that were named and the craft unions said that a settlement of the order of about 9·9 per cent., under 10 per cent., would so distort the existing wage structure differentials—not only the relativities between public and private sectors—that that was not possible at this stage. Therefore, I hope that my right hon. Friend will think again about figures of that kind.
The Minister did not give the relativities. It is understandable that he did not do so at that stage of the negotiations. Presumably he was speaking only for the Health Service and not the wider aspects of local authorities nor even those other public sector workers who have still to settle and who are about to enter a crucial stage in fair wage bargaining. The point is the 9·9 per cent. He did not relate it to a consolidated or unconsolidated base rate that now exists. The rate is 9·9 per cent.—of what? Where would the comparabilities start? What would be the relativities? Perhaps I should make a point about that matter.
I see that my hon. Friend the Member for Chester-le-Street (Mr. Radice) has returned. I may perhaps put to him a point about the incomes policy and why the TUC rejected it last year, and why it will continue to reject the idea of an incomes policy of a fixed kind similar to that which was discussed in the past.
I read with interest the new pamphlet "A Better Way" which appeared recently. It has a lot to offer. It is an admirable contribution to the discussion. The pamphlet says that the Government should make it known year on year how much is in the kitty and how much there is for distribution to top up the existing
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wage structures and perhaps bring about a little redistribution by way of comparability tests and getting the relativities right. That is all that the pamphlet talks about. It misleads people. It does not answer the major question that a voluntary incomes policy is not possible. It means nothing. The only incomes policies that can possibly work are those that are backed by statutory powers.
The great weakness about a statutory incomes policy relative to this debate is that the Government, when introducing a statutory policy, may talk only about maximum percentage increases or give a straight cash increase across the board. They cannot introduce any degree of flexibility that allows any element of plant bargaining or any adjustment between one group of workers and another. It is not possible to do that in a statutory incomes policy. That is its weakness.
There is also a weakness in this sense. Tonight we are speaking about the failure of three phases of incomes policy. It has produced this situation. The public sector workers have fallen behind their counterparts in the private sector precisely as a result of three phases of an incomes policy. Therefore, when the Government now say that the time has come under phase 5 to introduce some comparability tests, and that we should do something about the relativities, that asks too much of phase 5. Perhaps that is their intention. Perhaps they are now saying to the health and other workers "You must now work another year for Britain: let us put off the ultimate adjustments that are demanded in this dispute." Recent history is catching up with us. Therefore, the incomes policy is not on.
There is no such thing as unrestrained collective bargaining. There is always a restraint. There are ceilings in wages bargaining, which are set by the price that the private employer or the public sector can ask the rest of the community to pay for a service. The private employer must put a price on the product. That is the maximum against which wage bargainers have to negotiate. There is no other way.
If there is a pricing strategy that cuts right across the private and the public sector, it is possible by that means to relate the two sectors and to secure some justice between one set of workers and

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another and bring about some redistribution.
Mr. Radice: That is an incomes policy.
Mr. Atkinson: Of course it is an incomes policy. An incomes policy can be achieved in our kind of mixed economy only by having a pricing strategy, by being able freely to bargain against those restraints imposed by negotiated prices, agreed prices, that will come from such a strategy.
People say that it is impossible to get a relationship between the public and private sector—that has particularly come out in the present dispute—but in fact that is not so. When such negotiations are continuing it is possible to take craftsmen doing exactly the same job in both sectors.
Maintenance electricians and maintenance plumbers working in the private sector are doing exactly the same job as electricians or plumbers working in the public sector, particularly in hospitals. Let us say "There is a case. We have a comparability and relativity test at the same time for saying that those workers should earn roughly the same." Then we can start to organise the differentials in the public sector, in the Health Service and in local authority work, relating them to those craftsmen's agreements. We should get the relativities right and then get the differentials right in each industry. The thing then starts to fall into position.
The Government have no chance of succeeding in this long conflict unless they permit trade unionists to start negotiating the amount of resources to be made available in the public sector—not the other way round, saying that at the end of the day negotiators must come up against the restraints of cash limits and so on. Let the trade unions at the very beginning of the talks start to say how much of our nation's resources should be made available for health, housing, education and all the rest of the local authorities' work. Let the trade unions start in the beginning to agree upon the proportions and the allocation. Then they can argue sensibly about how those proportions are distributed within the various groups of workers. That is the more intelligent way of bringing sense into the whole business.
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The questions of global amounts and poverty wages all come into this matter. It is because we have a very low wage economy that we suffer the problems we do. Even Socialists have found no substitute for money. Incentives must be paid for. We all recognise that.
The right hon. Member for Crosby (Mr. Page), who spoke about productivity but was really talking about production, was corrected by my hon. Friend the Member for Liverpool, Walton (Mr. Heffer). My hon. Friend was right to correct him for always complaining about an individual's productivity. That is not the question. The question is one of total output, and that means production.
The incentive of a higher wage society must go with our demands for higher production and greater efficiency in the country. We shall never get them, we shall never solve the problems in the private or the public sector, so long as we have the obsession with paying low wages and imposing the most dreadful conditions upon our workers.
There would be a revolution but for the fact that an enormous amount of overtime is worked and wives go out to work to augment the family income. The present assessment of overtime hours is 35 million a week in the public and private sectors combined. The Government have issued figures for the public sector alone, but the trade unions have done their homework. They have put the two together and have found that the total is the figure I have given.
We shall not be able to reduce the level of overtime, because of the drastic reduction that would mean in overall earnings, until we get decent wage structures in both sectors. That is what this argument is about. In order to make room for job creativity, and in order to avoid the consequences of 2 million unemployed in three years' time, we must offer workers some confidence by building a better wage structure through increasing the base rates so that they do not suffer a massive drop in income each week by a reduction in hours.
Therefore, when 9·9 per cent. is offered it must be put against the demand of public sector workers for a minimum of £60 a week for 35 hours. That is not on, and the negotiators will say that. I hope that we can get some sense and understanding out of these debates so that we

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can build for ourselves a society that recognises responsibility and does not continue to exploit the loyalty of people who empty the bins without complaint, who shift the rubbish, who do all the filthy jobs, who make our society possible and make it work. These are the people upon whom the community depends and upon whom it is built. These are people who do the essential jobs. If we are to reach a more sensible arrangement, we must come to grips with that realisation, and what I have suggested is the only way in which it can be done.
9.16 p.m.
Mr. Michael Roberts: I do not wish to follow too closely the arguments of the hon. Member for Tottenham (Mr. Atkinson), except to say that I agree with him that the collapse of the present wage policy is as one phase follows another. It is totally wrong for the Secretary of State and some Labour Members to blame free collective bargaining at the moment when the Government's guidelines break down. If it is to work, free collective bargaining can work only in a climate of free collective bargaining. It is totally irresponsible to try to blame the people who advocate free collective bargaining for a breakdown of a wage guideline.
I particularly want to say something about the position in South Wales and in Wales generally. All hospitals there are working to rule, and in South Glamorgan there are selected areas for minimal work. We have reached the stage not of being on the pricipice but certainly of fast approaching it. A very serious situation is developing.
From my knowledge of those now engaged in industrial action, I believe that many men and women took that action with extreme reluctance. Many who are at present involved in working to rule have become increasingly alarmed at the consequences of their actions. They have become totally disillusioned with the union formula that only emergencies will be met, because the formula has proved insufficient to safeguard such emergencies.
I believe that the concentration on emergencies only has encouraged many people in the trade unions to adopt industrial action, because they felt that when it came to a matter of life or death they
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could at least ensure that no deaths resulted as a consequence of their action. But more and more people are realising that if routine essential treatment is not adopted this week the case becomes an emergency the following week. Indeed, it can be said that industrial action is creating emergencies which would not otherwise have existed.
Mr. Peter Viggers: Is my hon. Friend aware that the emergencies-only procedure can lead to strange situations? For instance, in the Portsmouth area, because cases are treated on an emergency-only basis, the ambulance drivers decided to deliver to the emergency hospital a legless 75-year-old man who was suffering from diabetes and chronic pneumonia. That hospital had no facilities to receive him whereas another hospital had.
Mr. Roberts: I am grateful to my hon. Friend. I suspect that few hospital workers anticipated the distress, pain and suffering that their actions have inflicted on patients and relatives of patients. Nearly all the hospitals in South Glamorgan are becoming cluttered with patients awaiting discharge who cannot go home because there are no ambulances. Anyone who has been in hospital for any time will know the distress that that can cause to a patient and to relatives. It also causes an additional strain and stress on the nurses and medical staff who have to continue looking after patients who should have been sent home. The ambulances and the ambulance men are available, but they do not regard taking sick people home as an essential service. It is not part of the emergency.
In the hospitals in South Glamorgan there are no telephone communications between the outside world and the wards. If a mother wants to telephone to find out how her child spent the night, she has to go through the emergency post. That is intolerable and something that the hospital workers did not expect.
Last Friday there was a threat that the university hospital, which is the regional and teaching hospital and the largest area hospital in South Wales, would be totally closed unless there was a satisfactory solution to the problem. That would be a disaster for the area and for the whole of Wales. I could give many more illustrations.

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Many of us are asking what the Welsh Office is doing. Last week it decided to call an emergency meeting of area health chairmen. The meeting was called not for last week or today but for next Thursday. That action is not sufficiently urgent in a time of emergency. The Welsh Office should be told that it is facing a crisis in an atmosphere of complacency. When will the Minister show some initiative and call not only a meeting of the area health chairmen but a meeting of the unions and the area health officers? I know of no such plan. It is in the interests of patients and the people of South Glamorgan that the Minister calls the unions and the area health officers together at the earliest opportunity.
The Secretary of State for Wales (Mr. John Morris): On the hon. Gentleman's ancillary remarks about complacency, he will understand that negotiations take place at a national level. It is for the area health authorities to deal with the matters locally. A fortnight ago when there was trouble regarding the ambulance men in Cardiff decisive steps were taken immediately to ensure that there was adequate cover for the Cardiff area.
Mr. Roberts: I am aware that a fortnight ago the Welsh Office took action. I have tried to show by giving one or two catastrophic examples in South Wales that the Minister should call the unions and area health officers together tomorrow or Wednesday. He should not delay giving a lead in these matters.
We should also like to know what guidance is being given to management on the question of volunteers. We accept the difficulties. But, whatever the guidelines, the Minister must indicate to management whether he will back any decision that it makes.
Many of us are concerned to know what will happen if the pay settlement is above 10 per cent. What will happen on the question of cash limits? Will we have an increase in the availability of cash or cuts in the hospital services in our area? Wales wants from the Welsh Office answers, not silence, action, not complacency.
9.25 p.m.
Mr. Neil Kinnock: I shall not follow the line of argument of the hon. Member for Cardiff, North-West
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(Mr. Roberts) except to agree with him that the people engaged in the current Health Service dispute, as in other disputes, are not the callous, selfish maniacs that they are sometimes described. Frequently in our system, especially during the last three or four weeks, people engaged in industrial disputes, particularly those in sensitive areas of public provision, have been described as cruel and anarchic idiots, incapable of looking beyond their own interests. The Health Service is the last place in which we would find such people. They could not do the kind of jobs that they do and they certainly would not have settled for the kind of pay that they get if they had any of those characteristics.
I had hoped that in tonight's debate we would not hear descriptions of these people as "irresponsible" or "selfish" or "concentrating entirely on their own self-interest". But there have been few instances of anything like an acknowledgment, let alone a generous acknowledgment, from Opposition Benches that we are talking about a section of the working class that has been goaded into the current action by years of being considered to be at the bottom of every pay pile. Sooner or later this reaction had to come. It has been spurred forward, naturally, by the fact that the Government have been seeking to operate a 5 per cent. wage policy at the end of three years of various sorts of wage restraint.
That 5 per cent. was unacceptable, is inoperable and will be insupportable because it is too low even to encourage people in the private or public sectors to come to the table to begin productive negotiations. Far from encouraging the idea that in order to compensate for a low basic norm there should be discussions about productivity, this 5 per cent. is the kind of figure that throws negotiators into resentful, unproductive and unco-operative silence.
In these circumstances, there is no point in anyone preaching that we should be able to depend on our workers in this kind of wage bracket to be co-operative and accept restraint. The fact is that we live in a society which victimises the slow and penalises the self-sacrificing. It is stupid for anyone to pretend that in this kind of society organised labour will be idle for long—especially when all around

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in that society they see the riches going to the fast, the fat and the profiteering. Sooner or later they are bound to ask when it will be their turn.
In that kind of society, in a market economy, in a system with a social code which teaches not co-operation and restraint but the law of the jungle, it would be idiotic to presume that, even with the best will in the world towards any Government, organised labour would be prepared to draw its claws all the time. That is why we have our present problems.
The situation is being exacerbated by certain difficulties. We have had the pet themes trotted out. We have had the relativities board trotted out. That is a bit like the boy standing on the burning deck in the middle of the conflagration criticising the design of the ship and the fact that not enough attention had been given to its protection against fire. It is too late in this development of incomes policy for relativities boards to be established with any hope of curing the present malaise.
It is equally stupid and even more destructive to talk about the removal of the right of public sector workers to strike. We will not defeat this essentially economic problem by juggling with the constitution in that fashion. We will not bring about industrial harmony by the withdrawal of civil rights for certain groups of workers. That will not ensure that the problem is resolved, that sick people are looked after or that dead people are buried.
There has been a galaxy of pet themes from all around. One is the proposal for secret ballots. In this country, as in everywhere else, and in our public sector and hospitals, as they have in our coal mining industry and our railways, secret ballots would inevitably and invariably guarantee the full-hearted endorsement of the original proposition for pay claims or industry action. I have no objection to secret ballots except that the time lapse between the original proposition and the publication of the result of the ballot wastes extra days, weeks or even months of precious negotiating time and the consequence of that would be entirely negative.
The Leader of the Opposition and many of her hon. Friends have given their des-
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criptions of the problem. The right hon. Lady is a mistress of innuendo. She has developed to a fine art the ability to give impressions that are later withdrawn or diluted.
Mrs. Kellett-Bowman: Rubbish.
Mr. Kinnock: I agree with the hon. Lady. The impression is invariably one of rubbish. The result of the right hon. Lady's actions is that she has become a predator, especially in these disputes, on misery. I have no objection to political profit being sought in these circumstances. We are accustomed to that, but for an alternative Government to do nothing by way of proposing serious alternatives and to concentrate entirely on that destructive attitude is totally and obviously unacceptable, and will not be commended in the country and can make no contribution to the resolution of disputes.
A contributing factor to the deteriorating situation and a mischievous and malevolent factor in the industrial disputes of the past month has been the totally irresponsible, frenzied, hysterical and sensational British press. I ask Conservative Members to look only at the front pages of the Sun and the Daily Mail. I have seen cartoons in recent weeks in the Daily Express and elsewhere of Hitler and Napoleon rubbing their hands at the prospect of a Britain on its knees. The only parallel in history for what we have seen passing for a free press in the past few weeks is Dr. Goebbels. The press has developed the art of suggestion, deception, misrepresentation and the big lie to a degree that he never managed to achieve.
I say seriously to Conservative Members that my view is not simply of the general paranoia of a party beleaguered by a free press but is a fact. That misrepresentation and exaggeration has contributed to fear, panic and disruption in our society, and Conservative Members should not seek to defend a press which acts in that fashion.
I say to the Government that it is not a question of their being supine in the face of trade union demands. It is a question of reality and of deciding whether it is better to try to secure a reduction of one or two percentage points in the inflation rate at the end of this year or to subject the country and the workers to the inconvenience and possible

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tragedy of the sort of disputes that we are experiencing and those that we can contemplate in future.
That is a decision for the Government. I believe that, even now, the concession of a minimum wage, based on the Government's own figure of £45 a week, the acceptance of the consolidation of the gains made in phases 1, 2 and 3 and the introduction of an 8·8 per cent. pay rise across the board in the public sector, with the finance to back that for the local authorities and hopital employers, could resolve the disputes and make a contribution at the root to overcoming low pay in our society. It would enable those in dispute to return to work to provide the services that civilisation and economic advance demand.
9.35 pm
Mr. Patrick Jenkin: This has been a revealing debate in one sense. We heard four speeches from the Labour Back Benches and we heard four totally different recipes for how to deal with the problem. The hon. Member for Bedwellty (Mr. Kinnock) has decided that it is all whipped up by the press.
My hon. Friends have left the House in no doubt about the grimness of the situation. Over half our hospitals are being hit by strikes, walkouts, blackings, picketing, intimidation and vandalism. We heard about the tyre slashing at Westminster. We did not hear about the porters pouring blood and urine samples down the drain at the "path" lab at the Dulwich hospital.
The Secretary of State took my hon. Friend the Member for Reading, South (Dr. Vaughan) to task because he said that 200 hospitals were closed. It is typical of the Secretary of State that he chose to leave out the last three words of the sentence. My hon. Friend said that 200 hospitals were closed "or partially closed."
My hon. Friends have been describing the effect on the health services in their areas when wards are closed and patients cannot be admitted to hospital. In many areas the situation is out of control.
My right hon. Friend the Member for Crosby (Mr. Page) was right to say that when NUPE called for the maximum dis-
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ruption of services it uncorked a bottle out of which all sorts of evil genii have come and that it cannot put the cork back again.
My hon. Friend the Member for Newcastle upon Tyne, North (Sir W. Elliott) said that the so-called code of conduct is totally inadequate and must be strengthened if there is any pretence of keeping emergency services going. But the House should say something about those who are helping to keep the Health Service going. We should say something about the thousands of staff who are refusing to join the disrupters and to the volunteers who are coming forward in droves to help out. The strikes and the disruption are throwing huge burdens on medical, nursing and administrative staff who are responding magnificently. We should thank them.
Nurses are scrubbing floors, administrative staff are collecting rubbish and soiled laundry, junior doctors and senior nursing officers are removing the bodies of those who die in the wards, medical students are acting as porters in accident and emergency units. I invite the Secretary of State to join me in thanking them for what they are doing.
Ancillary workers who are union members, vulnerable though they are to intimidation and reprisals, are resisting union pressure to strike. Many ambulance men have refused, as have those in Reading, to take action and are maintaining normal services. The same is true of workers in catering, portering, laundry and stores. Here, the Government can do something positive to help. The Secretary of State should state plainly and clearly that nobody who has worked normally during the dispute will lose his job. There must be no victimisation.
The Secretary of State has shifted his ground about volunteers. Last Thursday he was wholly negative. In his reply to my right hon. Friend the Member for Crosby he said:
"Of course there is no opposition from the Government side to the normal work that volunteers can do in a hospital. What is not right is that they should seek to do professional tasks which are carried out by others in the hospital."—[Official Report, 1 February 1979; Vol. 961, c. 1681.]
But today the Secretary of State quoted with approval the words of my right hon.

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Friend the Member for Leeds, North-East (Sir K. Joseph) in 1973 when he said:
"For my part, I have made it clear to the hospital authorities that if a safe level of essential services cannot be maintained in a hospital they will have to look to volunteers."—[Official Report, 21 March 1973; Vol. 853, c. 459.]
We have waited until today before hearing anything like that from the right hon. Gentleman. But the truth is that the circumstances are totally different and infinitely more serious today than they were in 1973. Then only 5 per cent. of the ancillaries were out. Now it is nearer 50 per cent. Then only 300 hospitals were affected, with none of them remotely approaching closure. Today well over 1,000 hospitals are affected, and some are closed while others are nearing it.
Mr. Ennals: Will the right hon. Gentleman give way?
Mr. Jenkin: No. The Secretary of State made a long speech lasting over half an hour.
The risk to patients today is far more serious than it was in 1973, and the need for volunteers is therefore much greater.
Does the Secretary of State recognise that in some areas today volunteers are not being allowed to do even the tasks they undertake in normal times? I have a letter from the co-ordinator of voluntary services at the Banstead hospital which is supposed to be protected because it is for long-stay mental patients. It says
"Our Union and Management Action Committee have now agreed that virtually all voluntary work should cease within the hospital until the end of this dispute."
So not even the normal tasks are being done by the volunteers. What does the Secretary of State say to that, and what is he doing about it?
One of the few cheering aspects of Labour's surly Britain is the readiness of thousands upon thousands of ordinary citizens to come forward and help out in taking care of the sick in hospital. But they get scant support from the Secretary of State.
My right hon. Friend the Member for Crosby complained that there had been no preparations to meet this disruption.
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That is inexcusable. We have known for months exactly what was going to happen. I have here an article from the Financial Times from as long ago as last October. It states:
"The plans are aimed at identifying areas of maximum disruption to the Health Service."
The effects, it said, could be even worse than those of the strikes of the maintenance supervisors. Those are the same words as appeared in the NUPE instructions in December where the union called for the
"maximum possible disruption to services."
There has never been any doubt about what was threatened, yet there have been no preparations.
In the words of one district administrator to whom I spoke, "There was no contingency plan at all. All we have had is belated talk of a hot line. DHSS instructions are so much hot air."
The Secretary of State may have said that this was a matter for individual health authorities, and it may have been, but we looked in vain for a lead from him. If it was to have been a matter for individual health authorities, how far did he help them? Let me quote from one of the instructions that he chose to send out when trouble was threatening. This document is headed "Management in Confidence" and it deals with the "prospective industrial action". This document was addressed to the very difficult question of whether staff who disrupt services should continue to be paid. These are the words of the Secretary of State, who said that things should be left to local management. The document read:
"The Secretary of State wishes to make a judgement on this issue, for application nationally".
So much for taking decisions locally.
"Authorities are therefore asked to await Departmental guidance before suspending staff or withholding pay from those who are taking industrial action"?
so no one was to lose any pay whatever action they took—
"or before 'laying off' staff who are not involved in the dispute and are willing to work normally but are unable to do so in consequence of industrial action by others."
Therefore, nobody likely to be laid off was left with any incentive to ignore union instructions and stay at work.

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The circular gave rise to the deepest anger among NHS management, which found the ground totally cut from under its feet. The document destroyed any chance that it had of persuading staff to stay at work and, perhaps more serious, it undermined what influence moderate and reasonable trade unionists may have had in countering the intimidation of the militants. So there was a row. What does the right hon. Gentleman do the moment there is a row? He backtracks. He sent out a hasty telex which said that the letter of 15 January, to which I have just referred, was
"to refer to industrial action other than strike action".
However, he did not stop there. A few days later the Secretary of State climbed right down. In an absolutely choice piece of officialese, he wrote on 24 January:
"The Secretary of State has considered reports from authorities, and other relevant circumstances, and has decided that local management should now exercise their normal discretion in responding to industrial action short of strike action."
What a deplorable exhibition of feebleness and indecisiveness! I can tell the right hon. Gentleman that it left local managements confused and bewildered, just when they were facing the worst disruption the National Health Service has ever seen.
But the right hon. Gentleman did not stop there. There was the disgraceful episode concerning Mr. William Bond at Birmingham, and the right hon. Gentleman will have to answer for that. The unions, often supported by Labour Members below the Gangway, have tried to accuse distinguished doctors of being willing to put their patients at risk for political ends. What the right hon. Gentleman did when he made that disgraceful attack on Mr. Bond on 25 January—he shakes his head, but I will deal with this—was to lend the authority of his office to that squalid campaign.
Mr. Ennals rose—
Mr. Jenkin: No. I shall not give way until I have finished. In doing so, the Secretary of State ignored the fact that Mr. Bond had been supported by the entire medical staff at the Queen Elizabeth hospital, Birmingham. He ignored the fact that Mr. Bond was supported by the district nursing officer, Mr. Matthew Dalton; he ignored the fact that other
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consultants had had to send patients home because the pickets had cut off supplies; and the Secretary of State further ignored the fact that Mr. Bond had to be persuaded by his fellow consultants before he agreed that his patients should bear their share of the cutback.
Mr. Ennals rose—
Mr. Jenkin: Let me finish and then I will give way. The Secretary of State was perfectly happy to blacken Mr. Bond's name by currying favour with the unions and by trying to pretend that the emergency service was operating. It was even more despicable of him to try to pretend that he had not issued the statement and that it had come from the area health authority.
Mr. Ennals: I am grateful to the right hon. Gentleman for eventually giving way. I hope that he will now withdraw his absolutely unjustified attack on me. The right hon. Gentleman knows perfectly well, and he has only to look up Hansard to ascertain this, that I made no comment at all on the statement that had been made by Mr. Bond. I read a statement issued that day in Birmingham. I did not elaborate on it and I made no judgment. I hope that the right hon. Gentleman will now withdraw.
Mr. Jenkin: I shall give way again if the right hon. Gentleman will now say he dissociates himself from the statement.
Mr. Ennals: The statement was issued by local management. It was put out in the name of the area medical officer and was issued from the hospital as a result of the inquiry that he had made at my request that morning.
Mr. Jenkin: The right hon. Gentleman had one purpose, and one only, in quoting that statement in the House. It was to try to show that the fuss being made by the Opposition was without foundation. He ought to be ashamed. Patients go into hospital to be treated by doctors, and for the Secretary of State to undermine the clinical authority of doctors is a betrayal of his office.
Mr. Andrew MacKay: Is my right hon. Friend aware that the Secretary of State chose not to believe the director of radiotherapy at the Queen Elizabeth hospital—the man

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who knew whether his patients were going to die—and instead chose to believe, first, the NUPE regional officer and, second, members of the area health authority, who were not at the hospital? Is my right hon. Friend further aware that the medical executive member of that team refused to sign the document which is so much flaunted round this House by the Secretary of State?
Mr. Jenkin: My hon. Friend knows a great deal about these matters. The Secretary of State will rue the day that he chose to make that squalid attack.
My hon. Friend mentioned NUPE. The right hon. Gentleman and his colleagues are facing serious difficulties because of the actions of NUPE. Much of this they have brought upon themselves. I understand that the Minister of State is a NUPE-sponsored Member of this House. We read in The Daily Telegraph on Saturday of how he has fearlessly disclosed this fact in the Register of Members' Interests. I will not quote the figures. They are all there. NUPE pays towards his election expenses and his local Labour Party. It is worse than that, because what the right hon. Gentleman has done is to elevate the local NUPE secretaries—those who are now causing the Government the maximum trouble—by plucking them out and having them up to talk to him in his office at the Elephant and Castle.
An example of this is the young man at the Westminster Hospital, Jamie Morris. Not once but several times, he has been to talk to the Minister of State in his office at the Elephant and Castle, bypassing local management and local procedures, even the union hierarchy. It is small wonder that that young man goes back to Westminster Hospital, as it was described to me the other day, on a gigantic ego-trip. That is the kind of person with whom hospital managements are having to grapple. If right hon. Gentlemen find that local unions do not obey the code, they have only themselves to blame.
The Minister of State, Department of Health and Social Security (Mr. Roland Moyle): The right hon. Gentleman was courteous enough to say that he would raise this matter. There is no truth in it at all. If certain people are saying to
160
the right hon. Gentleman what he has repeated in the House, I can only advise him that they are misleading him. If he continues to repeat this, he is misleading the House.
Hon. Members: Withdraw.
Mr. Jenkin: Of course, if the right hon. Gentleman tells me that I have been misinformed, I shall withdraw. I am bound to tell him that the sources of my information are pretty impressive. [HON. MEMBERS: "Name them."] I can, but I think that the right hon. Gentleman would not like it.
Mr. Moyle: I would be grateful if the right hon. Gentleman would name the sources.
Mr. Jenkin: I am not sure how far I am at liberty to disclose conversations in the lobbies of this House. We shall have this out later. The source was the one man who would know.
Will the Secretary of State now change his tone towards volunteers? Will he give a categoric undertaking that no one who works on will be sacked? Will he give an undertaking that no one who disrupts services and refuses to perform his normal work will continue to be paid normally? Such a thing has been agreed at Liverpool and it is an absolute outrage. Will he recognise that his so-called three-pronged initiative has amounted to nothing? There is an agreement to meet mangement. What is the basis of the offer management is to put forward?
The right hon. Gentleman has asked for a breathing space. He no doubt heard what Mr. Colin Barnett of NUPE said about this on the radio this morning. The right hon. Gentleman has asked for a comparability stutdy. Why has nothing been done since the Prime Minister made the statement about comparability studies on 14 January? We must get rid of overmanning in the Health Service and work towards comparabilities and relativities. We have spelt that out.
After five years of Labour Government the nation is facing the worst threat ever known in the National Health Service. There is as grim a picture facing patients as we have ever seen since the last war. I have only one further question to put to the Secretary of State. Will he now resign?
9.55 p.m.
Mr. Ennals: With your permission, Mr. Speaker, and that of the House, I should like to reply to the debate.
We have listened to a typically cheap and squalid attack from the right hon. Member for Wanstead and Woodford (Mr. Jenkin). He was totally negative in his approach. He had half an hour in which to set out his policy. I asked him a few questions when I spoke earlier. I asked what were his policies for settling the dispute. Nothing was said in reply. [HON. MEMBERS: "What are the Minister's policies?"] I asked what figures he would suggest for pay rises. Nothing came back. I asked him how he would deal with the problems of inflation. Nothing came back. I asked how he would contain the problems of industrial action. Again, nothing came back.
The right hon. Gentleman spent his time in making a squalid attack both on myself and on my right hon. Friends. [HON. MEMBERS: "And on the workers."] Yes, and on the workers. If the right hon. Gentleman intends to attack us, he should check his facts first.
Mrs. Kellett-Bowman: Answer our questions.
Mr. Ennals: The right hon. Gentleman should be prepared to state the facts in this House. The Opposition and the right hon. Gentleman in handling this debate have used the present situation, which concerns everybody in this House, purely for party political purposes. He has used this as an opportunity for a further attack on the trade union movement—attacks which we hear constantly from the Conservative Party. Those who work in the NHS will deeply resent the position taken by the right hon. Gentleman.
Let me pay tribute to all those who work in the NHS. I agree with my hon. hon. Friend the Member for Bedwellty (Mr. Kinnock) that the vast majority of those who work in it, whatever their
role, are dedicated to their work. Squalid attacks of the kind we heard this evening can only damage relationships in the service—a service that will have to carry on its work when this industrial dispute is over.
Mrs. Jill Knight: Will the right hon. Gentleman give way?
Mr. Ennals: No, of course I will not give way. The Opposition have jumped on the bandwagon again, this time in relation to a pay dispute.
Why do the Opposition intend to divide the House this evening? I put forward three proposals, and I want to know why they have decided to oppose them. I said that first we intended to have urgent negotiations for a single-figure settlement in this round and that we would enter negotiations now to settle the dispute. If Opposition Front Bench Members disagree, let them state their policy.
I said that the second rung of our policy was the early establishment on an agreed basis of a body to examine the subject of comparability. I believe that we have a special responsibility for those who work in the public service. There is no doubt that many of them feel that they have been outpaced by some who work in the private sector. We have taken this major decision and the Opposition, if they had any understanding of the needs of the public service, should support us in that initiative.
The third rung of our proposals was that we should appeal to the unions for a suspension of industrial action while talks take place. I hope that there will be a positive response from the unions—but if the appeal were to come from the Conservatives I can assure the House that there would be no response at all.
Question put, That this House do now adjourn:—
The House divided: Ayes 262, Noes 270.

Division No.68]

AYES

[10.00 p.m.

Adley, Robert

Bell, Ronald

Bowden, A. (Brighton, Kemptown)

Aitken, Jonathan

Bendall, Vivian

Boyson, Dr Rhodes(Brent)

Alison, Michael

Bennett, Dr Reginald (Fareham)

Braine, Sir Bernard

Amery, Rt Hon Julian

Benyon, W.

Brittan, Leon

Arnold, Tom

Berry, Hon Anthony

Brooke, Hon Peter

Atkins, Rt Hon H. (Spelthorne)

Biffen, John

Brotherton, Michael

Atkinson, David (B'mouth, East)

Biggs-Davison, John

Brown, Sir Edward (Bath)

Awdry, Daniel

Blaker, Peter

Bryan, Sir Paul

Baker, Kenneth

Body, Richard

Buchanan-Smith, Alick

Banks, Robert

Boscawen, Hon Robert

Buck, Antony

Budgen, Nick

Howell, Ralph (North Norfolk)

Pink, R. Bonner

Bulmer, Esmond

Hunt, David (Wirral)

Prentice, Rt Hon Reg

Burden, F. A.

Hunt, John (Ravensbourne)

Price, David (Eastleigh)

Butler, Adam (Bosworth)

Hurd, Douglas

prior, Rt Hon James

Carlisle, Mark

Hutchison, Michael Clark

Pym, Rt Hon Francis

Chalker, Mrs Lynda

Irving, charles (Cheltenham)

Raison, Timothy

Channon, Paul

James, David

Rathbone, Tim

Clark, Alan (Plymouth, sutton)

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

Rees, Peter (Dover & Deal)

Clark, william (Croydon S)

Jessel, Toby

Rees-Davies, W. R.

Clarke, Kenneth (Rishcliffe)

Johnson Smith, G. (E Grinstead)

Renton, Rt Hon Sir D. (Hunts)

Cockcroft, John

Jones, Arthur (Daventry)

Renton, Tim (Mid-Sussex)

Cooke, Robert (Bristol W)

Jopling, Michael

Rhodes James, R.

Cope, John

Joseph, Rt Hon sir Keith

Rhys Williams, Sir Brandon

Cormack, Partrick

Kaberry, Sir Donald

Ridley, Hon Nicholas

Costain, A. P.

Kellett-Bowman, Mrs Elaine

Ridsdale, Julian

Critchley, Julian

Kilfedder, James

Rifkind, Malcolm

Crouch, David

Kimball, Marcus

Roberts, Wyn (Conway)

Crowder, F. P.

King, Evelyn (South Dorset)

Rodgers, sir John (Sevenoaks)

Dodsworth, Geoffrey

King, Tom (Bridgwater)

Ross, Stephen (Isle of Wight)

Douglas-Hamilton, Lord James

Kitson, sir Timothy

Rossi, Hugh (Hornsey)

Drayson, Burnaby

Knight, Mrs Jill

Rost, Peter (SE Derbyshire)

du Cann, Rt Hon Edward

Knox, David

Royle, Sir Anthony

Dunlop, John

Lamont, Norman

Sainsbury, Tim

Durant, Tony

Langford-Holt, Sir John

St. John-Steves, Norman

Dykes, Hugh

Latham, Michael (Melton)

Scott, Nicholas

Eden, Rt Hon Sir John

Lawrence, Ivan

Shaw, Giles (Pudsey)

Edwards, Nicholas (Pembroke)

Lawson, Nigel

Shaw, Michael (Scarborough)

Elliott, Sir William

Lester, Jim (Beeston)

Shelton, William (Streatham)

Emery, Peter

Lewis, Kenneth (Rutland)

Shepherd, Colin

Eyre, Reginald

Lloyd, Ian

Shersby, Michael

Fairbairn, Nicholas

Loveridge, John

Silvester, Fred

Fairgrieve, Russell

Luce, Richard

Sims, Roger

Farr, John

McAdden, Sir Stephen

Sinclair, Sir George

Fell, Anthony

McCrindle, Robert

Smith, Dudley (Warwick)

Fisher, Sir Nigel

Macfariane, Neil

Smith, Timothy John (Ashfield)

Fletcher, Alex (Edinburgh N)

MacGregor, John

Speed, Keith

Fletcher-Cooke, Charles

Mackay, Andrew (Stechford)

Spence, John

Fookes, Miss Janet

Macmillan, Rt Hon M. (Farnham)

Spicer, Jim (W Dorset)

Forman, Nigel

McNair-Wilson, M. (Newbury)

Spicer, Michael (S Worcester)

Fowler, Norman (Sutton C'f'd)

McNair-Wilson, P. (New Forest)

Sproat, Iain

Fox, Marcus

Madel, David

Stainton, Keith

Fraser, Rt Hon H. (Stafford & St)

Marshall, Michael (Arundel)

Stanbrook, Ivor

Freud, Clement

Marten, Neil

Stanley, John

Fry, Peter

Mates, Michael

Steel, Rt Hon David

Galbraith, Hon T. G. D.

Maude, Angus

Steen, Anthony (Wavertree)

Gardner, Edward (S Fylde)

Mawby, Ray

Stewart, Ian (Hitchin)

Gilmour, Rt Hon Sir Ian (Chesham)

Maxwell-Hyslop, Robin

Stradling Thomas, J.

Gilmour, Sir John (East Fife)

Mayhew, Patrick

Stokes, John

Godber, Rt Hon Joseph

Meyer, Sir Anthony

Tapsell, Peter

Goodhart, Philip

Mills, Peter

Taylor, R. (Croydon NW)

Goodhew, Victor

Miscampbell, Norman

Taylor, Teddy (Cathcart)

Gorst, John

Mitchell, David (Basingstoke)

Temple-Morris, Peter

Gow, Ian (Eastbourne)

Moate, Roger

Thatcher, Rt Hon Margaret

Gower, Sir Raymond (Barry)

Monro, Hector

Thomas, Rt Hon P. (Hendon S)

Grant, Anthony (Harrow C)

Montgomery, Fergus

Thorpe, Rt Hon Jeremy (N Devon)

Grey, Hamish

Moore, John (Croydon C)

Townsend, Cyril D.

Grieve, Percy

More, Jasper (Ludlow)

Trotter, Neville

Griffiths, Eldon

Morgan, Geraint

Vaughan, Dr Gerard

Grimond, Rt Hon J.

Morgan-Giles, Rear-Admiral

Viggers, Peter

Gryils, Michael

Morris, Michael (Northampton S)

Wakeham, John

Hall-Davis, A. G. F.

Morrison, Hon charles (Davizes)

Walker, Rt Hon P. (Worcester)

Hamilton, Michael (Salisbury)

Morrison, Hon Peter (Chester)

Walker-smith, Rt Hon Sir Derek

Hampson, Dr Keith

Mudd, David

Wall, Patrick

Hannam, John

Nelson, Anthony

Walters, Dennis

Harrison, Col Sir Harwood (Eye)

Neubert, Michael

Warren, kenneth

Harvie Anderson, Rt Hon Miss

Newton, Tony

Weatherill, Bernard

Haselhurst, Alan

Normanton, Tom

Wells, John

Hastings, Stephen

Nott, John

Whitelaw, Rt Hon William

Havers, Rt Hon Sir Michael

Oppenheim, Mrs Sally

Whitney, Raymond

Hawkins, Paul

Page, John (Harrow West)

Wiggin, Jerry

Hayhoe, Barney

Page, Rt Hon R. Graham (Crosby)

Winterton, Nicholas

Heseltine, Michael

Page, Richard (Workington)

Wood, Rt Hon Richard

Hicks, Robert

Pardoe, John

Young, Sir G. (Ealing, Action)

Hodgson, Robin

Parkinson, Cecil

Younger, Hon George

Holland, Philip

Pattie, Geoffrey

Hooson, Emlyn

Penhaligon, David

TELLERS FOR THE AYES:

Howe, Rt Hon Sir Geoffrey

Percival, Ian

Mr. Spencer Le Marchant and

Howell, David (Guildford)

Peyton, Rt Hon John

Mr. Michael Roberts.

NOES

Abse, Leo

Armstrong, Ernest

Atkins, Ronald (Preston N)

Anderson, Donald

Ashley, Jack

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

Archer, Rt Hon Peter

Ashton, Joe

Bagier, Gordon A. T.

164

165

Barnett, Guy (Greenwich)

Ginsburg, David

Mulley, Rt Hon Frederick

Barnett, Rt Hon Joel (Heywood)

Golding, John

Murray, Rt Hon Ronald King

Bates, Alf

Gould, Bryan

Newens, Stanley

Bean, R. E.

Gourley, Harry

Oakes, Gordon

Benn, Rt Hon Anthony Wedgwood

Graham, Ted

Ogden, Eric

Bennett, Andrew (Stockport N)

Grant, George (Morpeth)

O'Halloran, Michael

Bidwell, Sydney

Grant, John (Islington C)

Orbach, Maurice

Bishop, Rt Hon Edward

Grocott, Bruce

Orme, Rt Hon Stanley

Blenkinsop, Arthur

Hamilton, W. W. (Central Fife)

Ovenden, John

Boardman, H.

Hardy, Peter

Padley, Walter

Booth, Rt Hon Albert

Harrison, Rt Hon Walter

Palmer, Arthur

Boothroyd, Miss Betty

Hart, Rt Hon Judith

Park, George

Bottomley, Rt Hon Arthur

Hattersley, Rt Hon Roy

Parker, John

Boyden, James (Bish Auck)

Hayman, Mrs Helene

Pavitt, Laurie

Bradley, Tom

Healey, Rt Hon Denis

Pendry, Tom

Bray, Dr Jeremy

Heffer, Eric S.

Perry, Ernest

Brown, Hugh D. (Proven)

Home Robertson, John

Phipps, Dr Colin

Brown, Robert C. (Newcastle W)

Horam, John

Price, C. (Lewisham W)

Buchan, Norman

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

Price, William (Rugby)

Buchanan, Richard

Hoyle, Doug (Nelson)

Radice, Giles

Butler, Mrs Joyce (Wood Green)

Huckfield, Les

Rees, Rt Hon Merlyn (Leeds S)

Callaghan, Rt Hon J. (Cardiff SE)

Hughes, Rt Hon C. (Anglesey)

Richardson, Miss Jo

Callaghan, Jim (Middleton & P)

Hughes, Robert (Aberdeen N)

Roberts, Albert (Normanton)

Campbell, Ian

Hughes, Roy (Newport)

Roberts, Gwilyrn (Cannock)

Canavan, Dennis

Hunter, Adam

Robertson, George (Hamilton)

Cant, R. B.

Irving, Rt Hon S. (Dartford)

Robinson, Geoffrey

Carmichael, Neil

Jackson, Colin (Brighouse)

Roderick, Caerwyn

Carter, Ray

Jackson, Miss Margaret (Lincoln)

Rodgers, George (Chorley)

Carter-Jones, Lewis

Janner, Greville

Rodgers, Rt Hon William (Stockton)

Cartwright, John

Jay, Rt Hon Douglas

Rooker, J. W.

Castle, Rt Hon Barbara

Jeger, Mrs Lena

Ross, Rt Hon W. (Kilmarnock)

Clemitson, Ivor

Jenkins, Hugh (Putney)

Rowlands, Ted

Cocks, Rt Hon Michael (Bristol S)

Cohen, Stanley

John, Brynmor

Ryman, John

Colquhoun, Ms Maureen

Johnson, James (Hull West)

Sedgemore, Brian

Concannon, Rt Hon John

Johnson, Walter (Derby S)

Selby, Harry

Cook, Robin F. (Edin C)

Jones, Dan (Burnley)

Sever, John

Corbett, Robin

Kaufman, Rt Hon Gerald

Shaw, Arnold (Ilford South)

Cowans, Harry

Kelley, Richard

Sheldon, Rt Hon Robert

Cox, Thomas (Tooting)

Kerr, Russell

Shore, Rt Hon Peter

Craigen, Jim(Maryhill)

Kllroy-Silk, Robert

Short, Mrs Renée (Wolv NE)

Crawshaw, Richard

Kinnock, Nell

Silkin, Rt Hon S. C. (Dulwich)

Cronin, John

Lamble, David

Silverman, Julius

Crowther, Stan (Rotherham)

Lamborn, Harry

Skinner, Dennis

Cryer, Bob

Lomond, James

Smith, Rt Hon John (N Lanarkshire)

Cunningham, G. (Islington S)

Latham, Arthur (Paddington)

Snape, Peter

Cunningham, Dr J. (Whiteh)

Leadbitter, Ted

Spriggs, Leslie

Dalyell, Tam

Lee, John

Stallard, A. W.

Davidson, Arthur

Lestor, Miss Joan (Eton & Slough)

Stewart, Rt Hon M. (Fulham)

Davies, Bryan (Enfield N)

Lever, Rt Hon Harold

Stoddart, David

Davies, Rt Hon Denzil

Lewis, Ron (Carlisle)

Stott, Roger

Davies, Ifor (Gower)

Litterick, Tom

Strang, Gavin

Davis, Clinton (Hackney C)

Lofthouse, Geoffrey

Strauss, Rt Hon G. R.

Deakins, Eric

Lomas, Kenneth

Summerskill, Hon Dr Shirley

Dean, Joseph (Leeds West)

Luard, Evan

Swain, Thomas

de Freitas, Rt Hon Sir Geoffrey

Lyon, Alexander (York)

Taylor, Mrs Ann (Bolton W)

Dempsey, James

Lyons, Edward (Bradford W)

Thomas, Jeffrey (Abertillery)

Dewar, Donald

Mabon, Rt Hon Dr J. Dickson

Thomas, Mike (Newcastle E)

Doig, Peter

McCartney, Hugh

Thomas, Ron (Bristol NW)

Dormand, J. D.

McDonald, Dr Oonagh

Thorne, Stan (Preston South)

Douglas-Mann, Bruce

McElhone, Frank

Tierney, Sydney

Dunnett, Jack

MacFarquhar, Roderick

Tilley, John

Dunwoody, Mrs Gwyneth

McGuire, Michael (Ince)

Tinn, James

Eadie, Alex

McKay, Allen (Penistone)

Tomilnson, John

Edge, Geoff

MacKenzie, Rt Hon Gregor

Torney, Tom

Edwards, Robert (Wolv SE)

Maclennan, Robert

Tuck, Raphael

Ellis, John (Brig & Scun)

McMillan, Tom (Glasgow C)

Urwin, T. W.

Ennals, Rt Hon David

Madden, Max

Wainwright, Edwin (Dearne V)

Evans, Fred (Caerphilly)

Magee, Bryan

Walker, Harold (Doncaster)

Evans, Ioan (Aberdare)

Mallalieu, J. P. W.

Walker, Terry (Kingswood)

Evans, John (Newton)

Marks, Kenneth

Ward, Michael

Faulds, Andrew

Marshall, Jim (Leicester S)

Watkins, David

Fernyhough, Rt Hon E.

Maynard, Miss Joan

Watkinson, John

Fitch, Alan (Wigan)

Meacher, Michael

Weetch, Ken

Flannery, Martin

Mellish, Rt Hon Robert

Weltzman, David

Fletcher, Ted (Darlington)

Mikardo, Ian

White, Frank R. (Bury)

Foot, Rt Hon Michael

Millan, Rt Hon Bruce

White, James (Pollok)

Ford, Ben

Mitchell, Austin (Grimsby)

Whitehead, Phillip

Forrester, John

Mitchell, R. C. (Soton, Itchen)

Whitlock, William

Fowler, Gerald (The Wrekin)

Molloy, William

Willey, Rt Hon Frederick

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

Moonman, Eric

Williams, Rt Hon Alan (Swansea W)

Freeson, Rt Hon Reginald

Morris, Alfred (Wythenshawe)

Williams, Alan Lee (Hornch'ch)

Garrett, John (Norwich S)

Morris, Rt Hon Charles R.

Williams, Rt Hon Shirley (Hertford)

Garrett, W. E. (Wallsend)

Morris, Rt Hon J. (Aberavon)

Williams, Sir Thomas (Warrington)

George, Bruce

Morton, George

Wilson, Rt Hon Harold (Huyton)

Gilbert, Rt Hon Dr John

Moyle, Rt Hon Roland

Wilson, William (Coventry SE)

166

167

Wise, Mrs Audrey

Wrigglesworth, Ian

TELLERS FOR THE NOES.

Woodall, Alec

Young, David (Bolton E)

Mr. James Hamilton and

Woof Robert

Mr. Donald Coleman

Question accordingly negatived.

PETITION

  High Court Attendances (Officers of the House)
  10.18 p.m.
  Dr. Oonagh McDonald: With your permission, Mr. Speaker, and that of the House, I wish to present a petition from David Frederick Charlton, who seeks leave, in accordance with the practices and principles of our procedure and precedents, to quote in connection with an action that is before the court certain written answers to questions.
  The petition is lengthy. The House might consider it adequate if I supplement the brief but, I hope, clear description that I have given of its contents by reading only the last substantive paragraph of the petition. It states:
  Wherefore your petitioner humbly prays that your Honourable House will be graciously pleased to give leave for reference to be made to the said reports and transcripts and to the proper Officers of the House to attend the hearing and formally to produce and to prove the same according to their competence.
  And you Petitioner, as in duty bound, will ever pray.
  Ordered,
  That leave be given for reference to be made to the said Reports of Debate and Reports and for the proper Officers of this House to attend the trial of the said action and formally to produce and to prove the same according to their competence.—[Dr. McDonald.]

  FISHING INDUSTRY (SCOTLAND)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. John Evans.]
  10.21 p.m.
  Mr. Teddy Taylor: I am very glad to have the unexpected opportunity to raise a few points on a subject about which I think every Scottish Member is very concerned—the problems facing the fishing industry in Scotland. I think that every hon. Member will agree that the industry is vital to Scotland. Although we have only one-tenth of the population of the United Kingdom, about half the total catch in the United Kingdom is by Scottish fishermen.
  170
  There are about 8,000 to 10,000 directly fully employed in the industry as fishermen, but many others are dependent on the industry. For example, about 10,000 are employed in fish processing, and there are many others, from auctioneers to merchants, involved in the industry and concerned about its progress.
  I should like to say how grateful I am to the Minister for agreeing to reply to the debate at such short notice. He will be aware of the concern in the fishing industry about its future. Those involved in the industry are concerned, first, about the lack of progress in the negotiations with the EEC. Until those negotiations are resolved there can be no secure future for the industry in Scotland.
  The anxiety has been increased by the fact that there have been signs of the EEC expressing concern about, and seeking to cancel, some of the conservation measures that this House agreed should be taken to protect our industry while the negotiations were taking place. It is highly regrettable that this action has been taken, bearing in mind that the conservation measures were unanimously agreed.
  The Minister will also be aware of the real concern in the fish processing industry, where there is considerable gloom. As always when we discuss fishing matters, the right hon. Member for Orkney and Shetland (Mr. Grimond) is present. He will confirm that in Orkney and Shetland the numbers employed in the fish processing factories have fallen in one year from over 700 to about 450. Many of the 450 are dependent on the temporary employment subsidy. Therefore, a serious situation faces the fish processors and a great deal of insecurity faces the industry as a whole. We want to know exactly what is happening and what can be done to help the industry.
  There is a serious problem of over-fishing in some areas, because trawlers which have been denied access to Iceland, Faroes, North Norway and the White Sea are looking for somewhere to fish. We have too many vessels chasing too few fish.
  We can all agree on the aim, which is that we want adequate exclusive limits, an adequate share of the total allowable catch which takes account of Britain's contribution to the EEC catch, and proper policing of the catch.

  171
  Having given very short notice to the Minister, I hope that he will be able to say something about three basic questions. First, what is the present state of negotiations? There was an indication that we might have an agreement in the summer. Then it was autumn and then it was by the end of the year. Now there seems to be no sign of an early agreement. Can the Minister give us any indication how the negotiations are proceeding and when he thinks we might have some sign of a settlement? I should like to make it absolutely clear that we are not pressing the Minister to sell out our interests and come to an early agreement, but it would be helpful at this stage to have some indication how the negotiations are going and whether he is optimistic about an early settlement.
  Secondly, we should like some information about the attempts by the EEC to nullify the conservation measures that have been taken to try to protect our stocks in the interim. We have heard about the efforts of the European Court to try to undermine some of these measures. Can the Minister give some indication about the state of play on the conservation measures which we agreed, and which have been implemented with the full support of the British House of Commons?
  My third question relates to the position of the fish processors. The Minister will be aware that many have had to reduce their number of employees. Some have had to close and others are totally dependent on TES, which is being phased out. At a meeting with the Secretary of State, attended by my hon. Friends the Members for Ayr (Mr. Younger) and Edinburgh, North (Mr. Fletcher), an assurance was given that he was looking at the serious problems of the fish processors. Can the Minister give us an indication whether progress has been made and whether a statement can be made?
  It would be useful to take the opportunity to say that if reports of our debates are read, as I am sure they are, by those concerned with Common Market negotiations, and those in the Commission of the EEC, the one thing about which they should have no doubt is that all parties in the House, at a time when we are disunited on so many things, are solidly
  172
  agreed about wanting to get a fair deal for British fishing. We are totally united on that. It is an issue on which all parties will be prepared to battle hard and in a united fashion.
  There is a rising tide of concern about aspects of EEC policy in many areas. I am sure that the Minister will accept, as would most reasonable people who keep in touch with British public opinion, that if we cannot get a fair and just deal on fishing, it will not help strengthen the unity of the EEC or its institutions. I hope that the Minister will make it absolutely clear that he agrees with the negotiating aims, will give us a report on what is happening, and will again make it clear on behalf of the House of Commons as a whole that this is an issue on which we are united and on which we are looking for action and progress.
  Several Hon. Members Several Hon. Members rose—
  Mr. Speaker: Order. It has long been the custom that the last half-hour Adjournment debate belongs to the person who initiated it and to the Minister, unless agreement has been reached between that person and the Minister that another hon. Member can participate. I do not know whether such an agreement has been reached.
  Mr. Hamish Gray: On a point of order, Mr. Speaker.
  The Under-Secretary of State for Scotland (Mr. Hugh D. Brown): On a point of order, Mr. Speaker. This is a rather unusual debate, and I certainly have no objection to other hon. Members taking part.
  Mr. Speaker: Mr. Hamish Gray, on a point of order.
  Mr. Gray: I am grateful to you, Mr. Speaker. I want to start by—
  Mr. Speaker: Order. I was not calling the hon. Gentleman to speak. I shall first call an hon. Member from the Labour Benches.
  10.27 p.m.
  Mr. Robert Hughes: The hon. Member for Glasgow, Cathcart (Mr. Taylor) has used his ingenuity in spotting that the Adjournment debate which was to have taken place now was taken earlier because the business did not

  173
  go its allotted time. In his usual sharp manner, he has raised a topic which is of vital concern to every fishing constituency and to every Member of Parliament who represents Scottish interests.
  I would not quarrel very much with what he said, certainly not about the importance of fishing to so many people in Scotland. I certainly would not quarrel with his statement that we must defend our fishing interests, or with his statement that the processing industry is in difficulty. But, even if only once in his life, I wish that the hon. Gentleman would give credit where credit is due. The one thing lacking in his speech was any appreciation whatever of the work that has been done by my right hon. Friends the Minister of Agriculture, Fisheries and Food and the Secretary of State for Scotland, and by my hon. Friend the Member for Glasgow, Provan (Mr. Brown), who deals with fishing matters at the Scottish Office.
  Had the hon. Gentleman given that credit, he would have accurately reflected the views of the fishing industry, not just in Scotland but in the whole of the United Kingdom, whether they are deep sea fishermen, middle water fishermen, inshore fishermen or herring fishermen. Each and every one to whom one speaks says exactly the same thing—"Thank goodness we have a very strong team that is arguing the case of the fishing industry within the Common Market".
  It is therefore a pity that the hon. Member for Cathcart approached the debate in a carping manner. He should have given credit to the Government. He was, as always, trying to criticise the Government. It is taking time to reach an agreement, but, as the hon. Gentleman and other hon. Gentlemen on the Opposition Front Bench know well, that is because of the problems of obtaining an agreement from the EEC. Any other team of Ministers might have been tempted, as he put it, to sell out the fishing industry in the interests of a quick agreement.
  Mr. George Younger: The hon. Gentleman is being unfair. It may have been what he thought my hon. Friend the Member for Glasgow, Cathcart (Mr. Taylor) would say, but my hon. Friend was careful not to say any of the things attributed to him.
  Mr. Hughes: The hon. Member for Cathcart is careful of what he does and does not say. But he cast aspersions on the Government in referring to the time taken to reach agreement and the mounting concern over the lengthy negotiations. If the hon. Gentleman checks Hansard, he will find that I am right. I accept that there is mounting concern. But the hon. Gentleman should have gone on to say that the reason for the delay is that my right hon. and hon. Friends have refused to accept an agreement that would be detrimental to the fishermen and shore-based processors in Scotland.
  There is concern. The Grampian fisheries committee will be visiting the Secretary of State for Scotland next week. I cannot remember the exact date. It is concerned, if no agreement is reached, that there should be further unilateral action by the Government to tighten up conservation measures.
  The Government should stand firm. I hope that the Minister will confirm that the Government will not allow an agreement to be made to the detriment of the fishing industry.
  There has been concern about the processing industry. The Minister will have received representations about constructing a scheme of aid for fish processors, especially herring processors. The industry has not got what it wanted. The hon. Member for Cathcart mentioned a meeting that he and his hon. Friends had had, and he may have been referring to this. But in a written answer to the hon. Member for Aberdeenshire, East (Mr. Henderson) about 10 days ago it was stated that companies with problems could apply for assistance under section 7 of the Industry Act. It has been interpreted by some people as meaning that the Government were washing their hands of the processing side of the industry and were not concerned about its future. I believe that the offer of section 7 assistance is a genuine attempt to help.
  I had a reply from the Minister of State, Scottish Office about a company with which the Scottish Development Office had been in contact in order to assist it to apply under section 7. I have written to the company to tell it that if there is any delay or difficulty in dealing with the Department I will pursue the matter. A large number of companies

  175
  have written to say that they need assistance, and I hope that they will immediately apply under section 7. If the company-by-company approach does not provide the assistance that the Government intend, I hope the companies will contact their Members of Parliament so that we can ask the Government to see whether something else can be done.
  It is not just a question of the fishing industry having difficulties. I want to raise one or two questions about the reconstruction of the Aberdeen fish market. I have been in correspondence with the Minister on behalf of the Aberdeen Harbour Board on this matter. There is some disquiet about the time taken in processing this application.
  I appreciate that when one is dealing with very large sums the Government cannot just hand out money on the first application. In fact, some of the people who seek such assistance—not the Aberdeen Harbour Board—are the first to complain that money is handed out too readily. Therefore, it is only to be expected that the Government will consider the application very thoroughly to ensure that they are getting value for money and that the facilities are really necessary.
  Sometimes those who speak on behalf of the fishing industry, including hon. Members, give the impression that the position is so bad that the provision of extra facilities and the refurbishing of fishing ports is unnecessary because there will not be the catch or the number of vessels to make it a viable concern. In pointing out the problems of the fishing industry we must not be too pessimistic, otherwise the Government might consider that the pessimistic views hold and that there is no need to put money into the industry. I hope that the Minister will assure me that the Government will look at the application from the Aberdeen Harbour Board for money to refurbish the port, as part of the quay has virtually collapsed overnight. I hope that, if necessary, the Minister will arrange a meeting with the board and myself before the board's next meeting on 23 February.
  10.38 p.m.
  Mr. J. Grimond: I shall be brief because this is a short debate and many of the points that I wished to make have been made in pre-
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  vious fishing debates. The Minister of Agriculture, Fisheries and Food and the Minister of State, Scottish Office have kindly agreed to see a deputation from Shetland and Orkney this week, but I could not let this opportunity pass without putting on record the anxiety felt in my constituency, which is already suffering from the setbacks in the fishing industry. In certain islands, if the fishing industry collapses, there will be nothing else to do. Also, we suffer—or enjoy—the magnetism of oil.
  Not only Common Market boats but British boats are driven back into Orkney and Shetland waters from further afield. This causes difficulties. I hope that the Minister will say something about this matter, and also about fish processing, which has caused great problems in my constituency.
  10.39 p.m.
  Mr. Alick Buchanan-Smith: I congratulate my hon. Friend the Member for Glasgow, Cathcart (Mr. Taylor) on taking the opportunity to initiate this debate tonight. I echo the remarks of the hon. Member for Aberdeen, North (Mr. Hughes) about the middle water and distant water fleets in Scotland. There is no doubt about the concern felt over the need for a long-term renegotiation of fisheries policy. I look forward to the Minister's progress report tonight.
  The important area of the Scottish fishing industry, apart from processing, is that section of the fleet which fishes in middle and distant waters. Their difficulties and the amount of money that the fleet is losing have been put to the Government. The fleet has pulled out of Granton and it will no longer be a fishing port. That is serious and Aberdeen could be threatened with the same prospect, though I hope that it will not.
  The Government gave help for English long and middle distance ports before Christmas. The scheme may not be appropriate to Aberdeen, but I hope that the Minister is aware of the problem there and is conscious of the concern and anxiety caused by what happened at Granton. I shall be grateful if, in addition to telling us what is being done about renegotiation, he will also inform us what help he proposes in the interim period for the middle water and distant water fleets in Scotland.
  10.40 p.m.
  Mr. Hamish Gray: There is not much time left in this debate and I expect that the Minister will write to us with his views on what we have to say. I wish to make some specific points about the intrusion in Scottish waters during the past fishing season of factory ships from Eastern Europe. My constituency and North-West Scotland have suffered greatly.
  I pay tribute to the co-operation I received from the Scottish Office during the summer. I did not have to contact the Ministry of Agriculture, Fisheries and Food, but I had occasion to contact the Scottish Office and I wish to place on record my appreciation of the co-operation that I received from the Under-Secretary and his staff. However, that co-operation did not prevent considerable pollution occurring near the port of Ullapool. That pollution has cause considerable damage to the sea bed, which, at that point, is principally used by the inshore fishermen who fish for smaller species. There is a considerable danger that their livelihood in the coming fishing season will be affected.
  The Ross and Cromarty district council has sought leave to bring in private legislation, but that takes time and it is doubtful whether those proposals will be in operation in time for next season. If they are not, I hope that the Minister will arrange for special conditions to be imposed by the Scottish Office on the factory ships before they enter our waters.
  Apart from the pollution and danger caused by those ships, there is a much wider aspect to be considered. I have little time for the political motives of those who operate those Eastern European ships. We may have innocent merchant seamen coming ashore, but we may also have less desirable and politically motivated people let loose in this country. What steps do the Government intend to take to ensure that those people are not welcomed among us?
  I am very angry with the hon. Member for Aberdeen, North (Mr. Hughes). He took a lot of time and contributed practically nothing to this debate. It is only courteous for me to leave the Minister a few minutes to reply. I thank him and his Department for their co-operation and
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  urge them to further efforts on behalf of Ross and Cromarty and North-West Scotland.
  10.45 p.m.
  The Under-Secretary of State for Scotland (Mr. Hugh D. Brown): I do not know why the hon. Member for Ross and Cromarty (Mr. Gray) needed to spoil a good speech by bringing in what sounded like a script for "The Thirty-Nine Steps". Our catching industry would be in a mess but for the factory ships, of whatever nation, that are willing to buy our mackerel—mainly for human consumption.
  However, I assure the hon. Gentleman that the possibility of pollution is a serious problem, especially in delightful areas such as Ullapool where the ships do not do much for the local fishing industries. Whether from Eastern Europe or anywhere else, the operators of those ships were most co-operative and we have no evidence or complaints of misbehaviour onshore. The hon. Gentleman was a little unfair. We recognise the problem and we shall do what we can. There is a practical problem about giving powers to a local authority in private legislation. That may relate only to one spot and mackerel might be landed somewhere else the next year. The possibility of the river purification board seeking an extension of its powers is being considered. I can assure the House that we treat the matter seriously. I am sure that we shall have the co-operation of all concerned in trying to minimise the pollution.
  This has been a useful debate, but we have missed the collective noise—if not the wisdom—of hon Members of the SNP. I say that with my tongue in my cheek and after the vote because I know that the hon. Member for Galloway (Mr. Thompson) has been here all day and will be reporting to his colleagues.
  The hon. Member for Glasgow, Cathcart (Mr. Taylor), unusually fairly, raised three matters which merit response. He referred to processors. We have volunteered help in encouraging firms to apply for aid under the Industry Act. I regret that we have not been able to find something outwith the existing schemes. The reason for my feeling of frustration is that I know of no other industry which is in difficulty simply because of a lack of raw material.

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  Hon. Members have been fair. They have expressed their anxieties about the industry generally and specifically. But the Government's powers under various Acts to assist industry do not meet the peculiar problems of an industry that is going through a difficult period simply because of a temporary shortage of a raw material—in this case, herring. That is the problem.
  We have had to fall back on the powers of the Industry Act. I cannot divulge confidential matters, but my hon. Friend the Member for Aberdeen, North (Mr. Hughes) has knowledge of one firm which has made an inquiry under the Act. I assure the House that we have given every encouragement and will give help to any firm which thinks that it can benefit from the wide powers available under the Act.
  The powers cover assistance for new projects which can create employment, modernisation and rationalisation, and assistance to firms which are at risk of causing redundancy. Firms that are in difficulty generally can receive help. I am not trying to argue with the Opposition, who are against increased public expenditure to assist private industry. Industry will need help in future and we are ready to consider ways of helping.
  Hon. Members raised the questions of conservation and negotiations. We have
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  had a rejoinder from the Commission about conservation to the effect that one of our conservation measures is of doubtful legality. We are required to make a response, possibly to the European Court. We are considering what case we should submit to the court. We are confident that we were right to take the measures. We had the backing of the House and we shall argue the case as best we can, and with some success, I hope.
  I turn to the state of negotiations. There is likely to be a Council meeting next week. We are aware of the difficulty of achieving agreement which is satisfactory to the fishing industry. We must be realistic. There must be a general election this year. One of the disadvantages of the EEC is that all member States have general elections from time to time. That is not always the best time to make decisions. Perhaps the country preparing for an election does not want a settlement or, more likely, the other countries do not want to come to agreement because there is some advantage—
  The Question having been proposed after Ten o'clock, and the debate having continued for half an hour, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
  Adjourned at nine minutes to Eleven o'clock.

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

CHEMICAL AND BIOLOGICAL WARFARE
Lord ELTON: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they have received reports that units of the East German Army are being trained by the Russians in the offensive use of chemical and biological weapons, what are the nature and number of these weapons, and what steps they and our allies are taking to protect their military personnel and civilian population.
The LORD PRIVY SEAL (Lord Peart): My Lords, Her Majesty's Government are aware of the reports that have appeared in certain journals describing the training of the East German Army by the Soviet Union in chemical warfare. Noble Lords should not, however, accept these reports as wholly accurate. Your Lordships will understand that to indicate the errors in detail would involve the disclosure of classified information. As regards the protection of the civil population of the United Kingdom, we are keeping the position under review. In common with our allies, we have taken measures to protect military personnel against the use of biological and chemical weapons. All personnel in the British Army on the Rhine are equipped with individual protective kit including a respirator, and armoured vehicles have protection against biological and chemical attack where necessary. RAF forces tasked to operate in the Central Region of Europe are, similarly, fully equipped and trained to operate under conditions of chemical and biological warfare.
Lord ELTON: My Lords, I thank the noble Lord for his reply, from which I gather that the activities at Leipzig and Neubrandenburg may not be entirely as sinister as we suppose. Is he aware that, leaving aside any of the satellite countries' forces, upwards of 70,000 Russian troops are employed solely in the use of chemical weapons, and that in particular the stocks of sarin, soman, and VX held by the Soviet forces have been greatly increased, and that these are nerve gases which are persistent in the atmosphere and do not make any distinction between soldiers wearing respirators and civilians wearing none? Does not the noble Lord regard this as a very serious threat indeed?
Lord PEART: My Lords, I am well aware of the dangers of the use of weapons that have been described by the noble Lord. I accept that. But NATO is well aware of this. I cannot go into details. It would be wrong of me to mention classified figures, et cetera. We are well aware of this, and I would only say to the noble Lord that I cannot answer the specific charges for the reasons I gave in my original Answer.
Lord SHINWELL: My Lords, may I ask my noble friend whether he is aware—apart from not going into details, which I can understand—that the East Germans have the strongest conventional military force of any country in Europe? Is he aware of that? That has been well known to some of us for several years. Is it known to the Government? Have they any details? Is NATO taking effective steps in order to circumvent anything of the nature of conflict initiated by the East Germans?
Lord PEART: My Lords, of course Her Majesty's Government are well aware of this. I am too. That is why I believe it is important that we should make our position known with our allies in NATO. Of course we are well aware of it.
Lord HAILSHAM of SAINT MARY-LEBONE: My Lords, while I fully understand the difficulties of the Lord Privy Seal in this matter, is not his original Answer really a very terrible thing indeed? All these weapons are in fact forbidden by treaty, to which I think the Russians and East Germans are both parties, and

445
by international law. Is it not a very terrible thing indeed that the Russians, who are so sensitive to criticism of any kind, treating it always as anti-Soviet propaganda, should be doing that which causes Her Majesty's Government and our NATO allies to have to take protective measures against what ought never to have existed?
Lord PEART: My Lords, I agree with the noble and learned Lord. May I say that the United States and the USSR are currently engaged in bilateral talks aimed at reaching agreement on the elements of a multilateral convention to prohibit the development, production, and stock-piling of chemical weapons. Naturally these talks are confidential, but it is hoped that before long the two Powers will be able to transmit the results of their deliberations to the multilateral disarmament negotiating body in Geneva for the negotiation of such a convention.
Lord W1GG: My Lords, will the noble Lord the Leader of the House be kind enough to publish in the Official Report the treaties of which the noble and learned Lord, Lord Hailsham of Saint Marylebone, alleges the Soviet Union and the East Germans stand in breach? Will he be good enough to publish them in the Official Report so that we can see exactly what has happened and the extent to which these treaties have been broken without anyone being aware of it?
Lord PEART: My Lords, there are many treaties. I will see whether I can do this. For example, the 1972 Biological Weapons Convention, to which the United Kingdom is a party, prohibits our possession of an offensive biological warfare capability. Incidentally, the convention was signed by the previous Administration. I think that the noble Lord, Lord Home of the Hirsel, who was then Foreign Secretary, signed the convention. I think the noble and learned Lord, Lord Hailsham of Saint Marylebone, was quite right in his approach to it; it really is a terrible situation
Lord HANKEY: My Lords, arising out of the supplementary question asked by the noble Lord, Lord Elton, may I ask the Government to consider once more whether the time has come to restart
446
air raid precautions training? Is it not extraordinary, the extremely low level of ARP preparation that exists in this country?
Lord PEART: I do not think we are at that stage, my Lords, but obviously this matter should be carefully watched.
Lord ELTON: My Lords, will the noble Lord accept that we are glad that efforts continue, particularly through the United Nations Disarmament Committee, to find means of monitoring the control of disarmament in this field? We are anxious because this weapon, which is employed tactically, has in fact a major strategic effect which, so far as I can see, is left out of consideration when discussing the SALT balance. And can he not recall—I am sure he can—that in the last war it was quite clear that the reason chemical weapons were not used on either side was that the other thought there was a very strong counter-strike capability? That situation no longer persists, and the Soviet Union are in possession of a means of sidestepping the nuclear threshold with a weapon which does exactly what they said was wrong with the neutron bomb by destroying people and not property.
Lord PEART: My Lords, I hope the noble Lord will appreciate that I cannot answer that. I do not think he should be too pessimistic.

PRIVATE TENANTS: RENTS
2.45 p.m.
Lord JANNER: My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper and, in doing so, I wish to indicate that I live in a flat of the type referred to in the Question and therefore have a personal interest.
The Question was as follows:
To ask Her Majesty's Government what steps they are taking to deal with the situation created by property speculators who refuse to let at a reasonable rent, thus creating a scarcity of flats and causing homelessness to tenants, even to those with over 30 years' occupation.
Baroness DAVID: My Lords, one purpose of the Rent Acts, to which the Government are strongly committed, is, by the system of fair rents, to protect private tenants against extortionate rent increases. The Government took a further step to help private tenants in 1975 when they introduced the phasing of rent increases over three years. All our evidence suggests that fair rents are substantially lower than market rents, particularly in Inner London. It is this system of fair rents that protects tenants against landlords who want to charge market rents. Where tenants have difficulty in paying a particular rent, there is a generous system of rent allowances to help them, with higher maximum levels in certain boroughs.
Lord JANNER: My Lords, may I compliment my noble friend on the new position she holds and on the very interesting reply she gave to my Question? May I also express my hope of forgiveness if I have to pursue the matter on rather different lines'? Is she aware that in the very flats that we occupy the landlords, who are Arabs, bought the property but have no registered office in this country? Is she aware that the property, which was offered at £13/4 million one and a half years ago, was sold to these people for £3 million, that they paid £500,000 to extend the lease, that they are now demanding an estimated £10 million for the property (apart from some of the flats which are not occupied) and that owners are charging as much as £500,000 for one flat? Is my noble friend further aware that the result is that people like, for example, one woman aged 93, who has lived there for 30 years, and who, having become a member of what are now known as the new poor—
Several noble Lords: Question!
Lord JANNER: I am doing my best.
Lord PEART: Do better.
Lord JANNER: I am doing the best I can, my Lords. Is my noble friend aware that this situation prevails and that the result will be exactly the same for the so-called new poor as it was when we were fighting for years to get the Leasehold Reform Act through Parliament? What
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do the Government intend to do to meet the situation?
Baroness DAVID: My Lords, I wish at the outset to thank my noble friend for the kind things he said. So far as foreign buyers are concerned, I think it would be quite unreasonable to discriminate between landlords or anyone else on the grounds of race or nationality. Foreign landlords are subject to British law, including the rent and housing Acts, just like anybody else, and they are also subject to capital gains tax. The tenants of foreign landlords have the same protection as those of British landlords. Existing tenants have security of tenure and, as I have said, are protected against extortionate rent increases. Nevertheless, the Government do not approve of this form of speculation and that is one reason why we are studying ways of helping tenants to buy the freehold of their block collectively in certain circumstances. We are also looking at ways of giving tenants and leaseholders in mansion blocks more control over management, including the standard and cost of services.
Lord HAILSHAM of SAINT MARY-LEBONE: My Lords, has the noble Baroness thought of reporting the Arab landlord of the noble Lord, Lord Janner, to the Arab Boycott Committee for having too much to do with Israel?
Baroness DAVID: Actually, I have not, my Lords.
Lord SANDYS: My Lords, first may I congratulate the noble Baroness upon her masterly debut at the Dispatch Box? Are the Government aware that the remedy for the situation, described at some length by the noble Lord, Lord Janner, is quite simple; namely, to increase the supply of accommodation? Are the Government further aware that the reason that accommodation has dried up is very largely due to their own legislation, the Rent Act 1974?
Baroness DAVID: No, my Lords, I would not agree with the noble Lord.
Lord JANNER: My Lords, is the noble Baroness aware that the provision which was referred to in the latest Rent Acts—that scarcity value has to be taken into

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consideration when fixing rents—is not being carried out? Is she also aware that the position is that scarcity values no longer maintain anything like an ascertainable amount, and that the whole position, according to the manner in which the matter is proceeding at present, creates a scarcity value which is almost practically 100 per cent. of the rent?
Baroness DAVID: My Lords, the rent officer is specifically told in the Rent Act that he may not take scarcity value into account and that he has to assume that the demand and supply for such accommodation are roughly in balance. It seems to me a little far-fetched to argue that the way to persuade more landlords to let accommodation, thus relieving scarcity, is to reduce their rent income. All our evidence suggests that market rents—that is, the rents which do exploit scarcity—would be significantly higher than current fair rent levels.
The Earl of KINNOULL: My Lords, does the noble Baroness agree that the Rent Acts are a particularly unkind subject for her to have to deal with on her first appearance at the Dispatch Box? Does she also agree that the fair rent system under the Acts at present is working satisfactorily, and that the fair rent officers interpret the law as it is intended? Furthermore, does the noble Baroness agree that the problem with Lord Janner's Question is that he is confusing those tenants outside the Rent Act, who do not have the protection of the Rent Act, with those who do? However, if the noble Lord is not, may I ask the noble Baroness how it is that a speculator can apparently charge an unreasonable rent, when in fact all the tenant has to do is refer the matter to the rent officer?
Baroness DAVID: My Lords, of course there are some tenants who do not have protection because the rateable value of the property they occupy is too high. This is a matter which is being looked at at the moment. There is a Rent Act review going on, and this is one of the matters that is being studied.
Lord PARGITER: My Lords, can my noble friend say to what extent rent officers ignore inflated capital values in fixing rents?
Baroness DAVID: I am sorry to say that that is something I do not know, my Lords. I will try to write to my noble friend with an answer.
Lord JANNER: My Lords, will the noble Baroness—
Several noble Lords: Oh, oh!
Lord JANNER: This is a terribly serious matter, my Lords. We are dealing with a problem in which thousands of people are to be put out of their homes—
Lord BOOTHBY: You are having a debate.
Lord JANNER: Will the noble Baroness—
Several noble Lords: Order, order!
Lord PEART: My Lords, I feel that my noble friend, whom I admire so much, is taking liberties. I think that it is the wish of the House that we proceed to my noble friend's next Question.

WAR CRIMES AND STATUTE OF LIMITATIONS
2.54 p.m.
Lord JANNER: My Lords, I beg leave to ask another important Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government how they intend to prevent the proposed limitation of the period in which war criminals can be tried in West Germany.
The MINISTER of STATE, FOREIGN and COMMONWEALTH OFFICE (Lord Goronwy-Roberts): My Lords, responsibility in the Federal Republic of Germany for the prosecution of war crimes and for the question of the application of the Statute of Limitations is a matter for the Government and the courts of the Federal Republic.
Lord JANNER: My Lords, I thank my noble friend for that Answer, but is he aware that Herr Schmidt, the head of the German set-up, has himself called

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upon his neighbours, who include ourselves, to do all possible to stop the Statute coming into force? Does my noble friend agree that the Nazis themselves have utilised Nazi monies in order to protect people and enable them to hide themselves for years, and that as soon as this present prosecution is over, they will come out and increase violence in relation to supporting the neo-Nazi activities?
Lord GORONWY-ROBERTS: My Lords, the second part of my noble friend's supplementary question is of course a comment on the situation, and I doubt whether anyone here would strongly disagree with the merits of what he says. However, with regard to the question he poses, he knows—and I need not assure him—that Her Majesty's Government have consistently supported the view that there should be no time limit on the initiation of legal proceedings or imposition of penalties with respect to war crimes and crimes against humanity. There is no such time limit in the United Kingdom. However, it is the Government's view—properly so—that the whole question of the application of the Statute of Limitations is primarily an internal matter to be determined by individual Governments themselves.
Lord JANNER: My Lords, I thank my noble friend very much.

TANZANIA/UGANDA DISPUTE AND WHISKY EXPORTS
2.56 p.m.
Lord GLADWYN: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether the President of Tanzania, who now appears to be at war with the dictator of Uganda, appreciates what this country is doing to sustain the morale of Amin and his entourage by the lavish exports of Scotch whisky.
The PARLIAMENTARY UNDERSECRETARY of STATE, DEPARTMENT of the ENVIRONMENT (Baroness Stedman): My Lords, I am
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sure that the President of Tanzania is aware that United Kingdom policy on civil trade with Uganda remains as stated by my noble friend Lord Goronwy-Roberts in his reply to my noble friend Lord Brockway on 31st January. Total United Kingdom exports to Uganda in 1978 were £19 million, of which £0·3 million was alcoholic beverages—not all whisky.
Lord GLADWYN: My Lords, I understand what the noble Baroness has said and I should like to ask two supplementary questions. First, do Her Majesty's Government sympathise with the efforts which the President of Tanzania is apparently making to rid the Commonwealth of the appalling monster who now rules Uganda? Secondly, if they do so sympathise, would it not encourage, and be acceptable to, Mr. Julius Nyerere, if they were able to stop all trade between this country and Uganda, which, after all, would not cost this country very much?
Baroness STEDMAN: My Lords, if I may take first the second part of the noble Lord's supplementary question, I should say that we are not happy with the, view that it would be proper to terminate the trade at the moment. We need to keep the trade lines open for various other reasons. With regard to the President of Tanzania, we have always made it quite plain that we believe that the African disputes ought, where possible, to be settled in an African context, and we hope that the situation can be established where these two neighbouring countries can live at peace. Her Majesty's Government have made available to the Government of Tanzania programme aid amounting to about £1 million to be used, subject to the normal conditions attached to such aid, for civilian rehabilitation purposes in the Kagera region. This is additional to the £2·5 million programme which we made available recently for other purposes.
Lord BOOTHBY: My Lords, is the noble Baroness aware that nobody should ever attempt to prevent the export of Scotch whisky to anyone, even to cannibals, because it can have only a soothing and wholly beneficial effect?
Baroness STEDMAN: My Lords, I am sure that the House accepts the noble Lord's free gratis advertisement for the whisky of his homeland.
Lord BROCKWAY: My Lords, is the Minister aware that the President of Tanzania, with whom I discussed this issue only last month, denies that Tanzania is at war with Uganda? Will she consult her own Commission in Nairobi, which I think will inform her that the Ugandans who were found dead in Tanzania were killed by another Ugandan battalion, and that the only action which Tanzania has taken has been to reply by artillery when she has been invaded?
Baroness STEDMAN: My Lords, I note the noble Lord's comments, and I am quite sure that my colleague and noble friend Lord Goronwy-Roberts has also noted them, but they are not really tied up with this particular Question.
Lord HAWKE: My Lords, is the noble Baroness aware that President Amin is by no means unique as a monster in black Africa? There are other rulers who appear to be almost as bad.

ANTIQUITIES BILL [H.L.]
Lord A BINGER: My Lords, I beg to introduce a Bill to provide for the better protection of small antiquities discovered in the ground and elsewhere; to abolish treasure trove; and for connected purposes. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read 1a.—(Lord Abinger.)
On Question, Bill read 1a, and to be printed.

ANCIENT MONUMENTS AND ARCHAEOLOGICAL AREAS BILL [H.L.]
3 p.m.
Baroness STEDMAN: My Lords, I beg to move that this Bill be now read a second time. My Lords, the first legislation in this country which began the process of safeguarding the physical survivals of our past was enacted in 1882, and the
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principal Ancient Monuments Act dates from 1913. There have been amendments and additions in 1931, 1953 and 1972. The legislation is now fragmented and, if I may use the term in this context, is now in need of modernisation. This Bill consolidates, modifies and extends the present provisions, taking account particularly of the increased pace and scale of modern development and the destructive capacity of modern agricultural methods, which together have resulted in the loss of a large proportion of our archaeological inheritance. It also takes account of the great increase in recent years of public interest in monuments, which, welcome as it is, also brings with it new problems of management.
Perhaps I should explain that an ancient monument may be any man-made structure or other work, whether buried or upstanding, of archaeological, historical or architectural importance. In practice, the structures with which this legislation is concerned are usually ruinous, or at any rate no longer of much use for current social or economic purposes. That is the broad distinction between ancient monuments and buildings of special architectural or historic interest which are protected under the Town and Country Planning Acts. Ancient monuments range from pre-historic settlements and burial mounds, through the survivals of Roman military occupation to Norman castles and medieval abbeys. It may not be so well known that ancient monuments in State care also include a number of unoccupied and mostly ruinous country houses of the 16th and 19th centuries, as well as several industrial monuments and fortifications of the 18th to 19th centuries. This illustrates our policy of attempting to preserve a representative sample of our heritage.
In preparing this Bill we have taken account of changes in circumstances since its main predecessors of 1913 and 1931. Since opportunities for major legislation in this field occur very rarely, we have provided for needs which are already on the horizon and have not dealt only with matters that are already pressing. One example is the power to terminate guardianship in certain circumstances with the consent of the owner. So far as the preservation of monuments is concerned, with which Part I of the Bill deals,

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we are retaining the fundamental principles of the present legislation. Part II, which is about rescue archaeology, breaks new ground.
Noble Lords may be interested to know that a copy of the notes on the clauses to the Bill will be deposited in the Printed Paper Office as soon as these are completed. I must here disclaim any personal credit for the Bill, since it awaited me when I took up my present post. My noble friend Lady Birk was in charge during its preparation and was responsible for the Consultative Document of March 1977 which set out the Government's proposals. The Bill reflects those proposals very closely. Some changes have been made in the light of representations and further examination of the subject, but these are mostly procedural.
My Lords, let us consider the main provisions of Part I. The first step towards preservation is to select and identify the monuments it is desired to protect. The process is generally known as "scheduling", because the first statutory list of ancient monuments—still in force—was the Schedule to the Ancient Monuments Act 1882. Each proposal to schedule is considered by the appropriate Ancient Monuments Board, and I should like to record our debt to the distinguished chairmen and members of these boards for the advice they give so devotedly from their unrivalled knowledge about archaeology and architectural history. There are now over 12,000 scheduled monuments in England, over 4,000 in Scotland and just under 3,000 in Wales. The Bill remodels the provisions dealing with scheduling, but the machinery is essentially the same.
The main effect of scheduling at present is that anyone proposing to do works affecting a scheduled monument must give notice to the Secretary of State. This gives an opportunity for advice and persuasion, and in a great many cases harm to the monument is avoided by this means. But if agreement cannot be reached, the Secretary of State has to invoke compulsory preservation powers. This procedure is cumbersome and, even worse, may create a situation of confrontation. The Bill provides, instead, for a consent procedure. This change is
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similar to the one Parliament made in 1968 in respect of buildings of special architectural or historical interest, which has been generally recognised as beneficial. We believe that the consent procedure is no less desirable for ancient monuments and that it will be more effective and more flexible.
Where an application for consent appears unacceptable, the Department will explain the reasons to the applicant and will seek, if possible, to help him achieve his objective in ways which do not harm the monument. Where agreement cannot be reached and the Department feels obliged to maintain opposition to the proposed works, the applicant will have the chance to put his case to an independent person appointed for that purpose. There is provision for compensation for refusal of consent in certain circumstances, particularly in respect of restrictions upon cultivation.
However, legal protection is not enough; there must be positive means of securing preservation. These already exist, firstly in the giving of grants towards the cost of repairing and maintaining monuments and, secondly, in the assumption of responsibility for certain monuments of great importance by the State or a local authority by guardianship or outright acquisition. Guardianship enables the State to maintain and manage a monument while leaving its ownership undisturbed. The appeal of this device to our predecessors in 1913 is understandable. It sometimes complicates life for the guardian, but the device remains useful, so we are retaining it, along with the other provisions I have mentioned. There are now 398 monuments in State care under this legislation in England, 320 in Scotland and 121 in Wales.
Occasionally, the owner of a monument of great importance which is falling into decay will neither accept help in maintaining it nor offer it in guardianship. The only present means of preserving the monument in such cases is to take guardianship compulsorily. This seems to be a somewhat strange application of an arrangement which presupposes goodwill on both sides, and compulsory guardianship has not in fact proved satisfactory in some of the few cases where it has been found necessary. We propose to replace it by a power of

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compulsory acquisition where that is necessary to secure the preservation of the monument. I hope noble Lords will note that limitation, because the power will not be available for any other purpose.
We have also thought it right to reinforce the present power to acquire land by agreement for the management of a monument—for example, for the provision of facilities for visitors—by a power of compulsory purchase for the same purpose. The background to this is that visiting on the scale experienced at many monuments has often raised serious problems. There is a need at such monuments for facilities for visitors in the interests of the locality no less than of the visitors, and these have to be most carefully sited. It may be found that only one site will be satisfactory. There is no problem at all if the owner is a willing seller, but if he is not, or if he is out to exploit his monopoly position, then the Secretary of State cannot at present discharge those responsibilities properly. We are accordingly seeking a compulsory power for the Secretary of State, who would, of course, exercise it only in relation to monuments in public ownership or guardianship. We have done this without eagerness and with no immediate intention of using the power, but we are satisfied that it should be there as a last resort. My Lords, those are the main changes in Part I.
Part II breaks new ground in the interests of rescue archaeology. Many of our cities and towns are situated where settlements have existed since Anglo-Saxon, Roman or even earlier periods. This continuity of settlement produces the superimposition of building remains and occupation material which in certain circumstances can be over 10 feet deep. Consequent rebuilding destroys as well as adds to the archaeological strata and the construction of deep basements from Victorian times onwards has been especially damaging to the archaeological evidence. Redevelopment, particularly comprehensive redevelopment, quickened the pace of destruction. Archaeologists have, in these circumstances, seen the need to concentrate their resources on the investigation and recording of a necessarily small proportion of sites of high archaeological potential before the information they contain is lost for ever. Archaeo-
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logical evidence, like that from historical documents, enables us to understand how our present towns and countryside have evolved. With the rapid destruction of archaeological sites we have a wasting asset and there will increasingly be fewer sites from which our history can be reconstructed. This is not, as I have hinted, solely an urban crisis; there is a need for rescue excavation in the countryside; for example, where minerals are to be extracted or a new road built or where a site is being destroyed by cultivation.
During the last two decades, archaeologists and my Department have responded to this situation by moving from a piecemeal and unco-ordinated response to the establishment of full-time professional archaeological teams drawing upon local and amateur help. These teams or units have been ready to negotiate with local authorities and developers for opportunities to investigate sites before development or redevelopment takes place. They may be based on a university department or a museum or a local authority or an archaeological society or may take the form of an independent trust. The main source of funds of these archaeological teams or investigating bodies is the Exchequer, although substantial help is given in many areas by local authorities and some money is raised from private sources. My Department is able, through the Inspectorate of Ancient Monuments with the advice of the Ancient Monuments Boards, to direct much of this activity so that resources are concentrated on the sites which are likely to be most informative and contribute to a carefully considered research programme.
The need for statutory provisions arises from the fact that there is at present no certain way of ensuring that archaeologists get access to important sites for an adequate period, or indeed at all. Some developers will not give archaeologists access to their sites even for observation; others may be persuaded to do so but only for, say, a few weeks, when a worthwhile excavation would require at least two or three months. I am not attacking developers; many have been very cooperative and have even contributed to the costs of the archaeological excavation. Nor do I wish the archaeological bodies, often assisted by the local planning authority, to desist from seeking oppor-

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tunities by negotiation. A voluntary agreement will often work better for both parties than a statutory right because of the inevitable rigidities of the latter.
The Government have, however, been persuaded that it is necessary to reinforce voluntary arrangements by providing a statutory right for the rescue archaeologist to have access for a limited period to selected areas of special importance. The first reason for this is that there is at present the risk that the developer will deny access to a site of great importance, with the inevitable consequent loss of rapidly diminishing evidence of the past. The second is that where the developer has been persuaded to allow access, the period is sometimes so limited that the work of the archaeologist is so restricted as to be hardly worth attempting or, if it is, does not give as good value as it should for the skills and money expended.
The new powers we are seeking would enable the Secretary of State to designate an area of archaeological importance. He would also be enabled to nominate an investigating authority for the area. This would normally be one of the archaeological bodies I have described. Once the designation of the area has been made after publication of the proposal and after a waiting period of six months before it comes into operation, anyone proposing to carry out operations which would disturb the ground within the area must give at least six weeks' notice to the local authority. The purpose of this notice is to enable the investigating authority to inspect the site and to consider what investigations, if any, it wishes to carry out before the operations take place and to discuss its requirements with the person who gave the notice, whom I will call "the developer".
If the investigating authority wishes to excavate, it may serve a notice on the developer and the local authority requiring access for the purpose for a period not exceeding 43/4 months starting from the end of the six-week period of the operations notice, or from the date when the site is cleared of any buildings which the developer intends to demolish. In short, the maximum delay for archaeological purposes is to be six months of which not less than 4½ months will be available for excavating.
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In practice, I hope that archaeologists and developers will come to agreements to their mutual advantage. For example, it might be possible for the archaeologists to tackle, first, a part of the site which the developer needs as soon as possible and complete their investigation there in a month or two, while the developer might be willing to allow a longer period than is required by statute on another part. I do not expect the archaeologists to ask for the maximum period in every case; many digs need only two or three months and rescue archaeologists have a deserved reputation for achieving their purpose while impeding development as little as possible. Cases may, nevertheless, arise where the requirements of the investigating authority appear unduly to hold up urgently needed development. It will always be open to the developer and the local authority to make representations to the Secretary of State. He will have power to give directions to the investigating authority or to take away the authority's rights in respect of the whole or part of the site. There are supplementary provisions about access by the investigating authority to the site and to any buildings on it for the purposes of observation and recording before and during the development operations, but these contain no provision to hold up the work.
I must say a word about compensation. We take the view that where a site of high potential is to be developed in a manner which will destroy its archaeological value, it is right that the developer should allow an opportunity for rescue investigations and that he should not be paid anything in respect of the delay. In some countries he is required to meet the cost of the excavation, but we do not propose that. We have devised the arrangements in the Bill so as to give prospective developers full opportunity to take account of the archaeological requirement in drawing up their work programmes and thus to minimise extra costs. The archaeological excavation of a site sometimes makes the subsequent development works themselves more expensive. I believe this to be unusual but, where the site is damaged in that way, compensation will be obtainable from the Secretary of State.
There are certain forms of development which cannot readily be fitted into the

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pattern I have described. These include large-scale mineral extraction which is programmed over years rather than months. We have undertaken to exempt such operations by order in return for adherence by the industry to an agreed code of practice which is now being prepared. There are also problems for authorities with powers of compulsory purchase in that for good reasons—for example, to minimise loss of agricultural production—they delay taking possession of land until work is about to begin and they have no right to give earlier access to the archaeologist in order that he may decide what investigation, if any, will be required. In such cases, where acquisition is in prospect under compulsory powers, we are providing that the investigating authority may have access at any reasonable time before the acquiring authority takes possession of the land, for purposes of inspection for a period of one month in order to assess what further investigation may be required before or during the carrying out of the works. Perhaps I should mention here that while the Crown will not be statutorily bound to give notice of Crown development in a designated area, the Crown will comply with the spirit of the legislation, subject to any overriding national needs.
I believe that many developers may be glad to have a statutory indication of what is expected of them to enable the archaeological heritage to be recorded before they destroy it, and that by enacting these provisions Parliament may in practice help to secure that even more is achieved by voluntary means. However, I hardly expect all developers to welcome what I must admit is a further complication and a possible cause of delay. Equally I shall be surprised if some archaeologists do not demand a good deal more than we are proposing here. We have tried to hold a balance. There is no perfect answer to a problem of this sort, and I shall be pleased to consider suggestions for improving our proposals.
I shall not detain the House long over Part III which well deserves its title "Miscellaneous and Supplemental", but some of its provisions are novel and require explanation. Clause 42 forbids the use of a metal detector without consent at protected monuments and archaeological sites. The need for this restriction arises
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from the recent hobby of "treasure hunting" with the aid of electronic detectors. This can be an innocent pastime, but it can lead to irreparable damage and loss of knowledge. It is not, of course, the detector itself that is harmful but where the metal object it locates is below ground, the action of digging up that object is very likely to be harmful to an archaeological site. This is because the removal of the object from its context, that is the stratum of soil in which it was contained, destroys a relationship that would be significant to a scientific understanding of the site.
It has, since 1913, been an offence to damage a scheduled monument, and treasure hunting of this kind constitutes damage; but this sort of damage can be hard to prove. Licences are in fact required for another purpose by the Home Office but this has no bearing on the prevention of archaeological damage. Prosecution is anyway a poor substitute for prevention since the damage cannot be made good. It is for these reasons that we seek to control the use of metal detectors at the sites protected by this Bill.
Clause 54 enables an archaeologist who has made a find in the course of a statutory investigation or inspection to retain it for conservation and recording. This is necessary in order to extract the evidence the find may be capable of providing. The rights of the owner will not be permanently affected. Traditionally, owners of land who have agreed to an excavation further agree to donate any finds to a museum or similar institution where they may be held together with the records of the excavation for the benefit of scholars. This is an admirable tradition and I trust that your Lordships will join me in commending it. Our modest proposal is not to be seen as undermining the tradition but as a minimum precaution, necessary in particular in relation to the new powers involving what I may call the obligatory excavation in designated archaeological areas.
The Bill has also provided the opportunity to introduce some urgently needed historic building legislation. In 1975, as a result of the success of European Architectural Heritage Year, the Government promised to help finance our Architectural Heritage Fund which would

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provide loans to local historic building preservation trusts and other bodies to enable them to renovate buildings of worth. This Fund has now been in operation for some time. Clause 49 regularises our contribution to it. We are also taking the opportunity to introduce in Clause 48 provisions which will enable grants made to historic buildings and conservation areas to be recovered in certain circumstances. Experience has shown that property is sometimes sold at a profit shortly after the grant has been made. It is desirable that the Secretary of State should have power to recover in such cases, although he would of course consider each one on its merits. My Lords, I commend this Bill as a most desirable strengthening of the means of protecting and preserving parts of our heritage, and ask the House to give it a Second Reading. I beg to move.
Moved, That the Bill be now read 2a.—(Baroness Stedman.)
3.26 p.m.
Lord MOWBRAY and STOURTON: My Lords, the noble Baroness has introduced this Bill to us in her usual admirable way and I am sure we are all most grateful to her. The preservation of our heritage for future generations is a duty that we all are agreed upon. Thus from our distant past we have the Iron Age fort at Figsbury, Wiltshire, the famous Broch of Mousa in Shetland; Wideford Hill—that famous cairn—in Orkney, and the Roman theatre at Verulam, and hundreds of other ancient monuments. But there have been some bad examples of ruthless operators damaging and even destroying ancient monuments which have got in their way. This Bill will strengthen the Secretary of State's hand in this sphere, and having all the legislation on ancient monuments, both old and new, all together in one Bill is to be welcomed. On the whole, Part I is unanimously acclaimed.
There are one or two points which I could mention, but as I see that my noble friend Lord Middleton is to speak, I shall leave the agricultural aspects for him to deal with. Clause 15, dealing with the compulsory acquisition of land round an ancient monument could cause
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concern. I was going to ask the noble Baroness to reassure me that the power will be used sparingly, but she ha" already answered that question most admirably. I am very grateful to her for having done so.
I welcome the concept of the areas of archaeological importance set out in Part II of the Bill. When we consider ancient cities like Canterbury or Winchester, it would clearly be absurd to regard them as chance assemblages of individual archaeological sites and ancient monuments. They must be taken as a whole; they must be preserved as a whole. I wish to associate myself with the view of Professor Barry Cunliffe—whose great work at Fishbourne will be well known to all noble Lords—when he says that this Bill provides a proper framework for the study and management of our archaeological heritage for the benefit of generations to come.
There are only two general observations that I want to make. First, the increased popularity of archaeology in recent years is a very heartening development. At the end of the last war, fewer than 50 organisations were affiliated to the Council of British Archaeology. Today there are over 400. Archaeology is the fastest growing extramural course in our universities. Every year thousands of our young people assist as volunteers in archaeological digs and I think that we could all agree that this provides both healthy exercise in the open air and a unique insight into the rediscovery of the past.
However, this growth in interest in archaeology is not without its dangers. There can be no possible harm in archaeological work under proper control and supervision, but the activities of the ill-informed, who believe that archaeology consists merely of treasure hunting, can pose great dangers. In particular, the use of metal detectors can, as the noble Baroness said, threaten the very existence of crucial archaeological sites.
The Bill contains provisions to restrict the use of metal detectors in designated areas. I think it is probably impossible to go further than this in restricting their use, but I wonder whether or not the noble Baroness, perhaps in co-operation with the

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Council for British Archaeology, could suggest methods of discouraging the use of metal detectors outside these areas by pointing out to their users the damage they might do. Obviously, some users of metal detectors are motivated purely by greed. They are concerned solely with finding something they can sell and have no interest whatsoever in the archaeological significance of any finds. For them archaeology is merely the handmaiden of cupidity.
Perhaps the Bill of my noble friend Lord Abinger will assist in this matter, but I am sure that the vast majority of those who use metal detectors would be quite horrified if they knew that their activities could pose a threat to our heritage. I am sure that they would be very happy to lend their energies to proper archaeological work, and it may very well be that organisations such as RESCUE could make good use of their services. I believe that there are in fact organisations of those who use metal detectors and I would hope that they could be persuaded to co-operate. I am sure they would have everything to gain from channelling the energies and enthusiasms of their members in helpful and responsible directions.
As I have said, Part II of this Bill gives the Department of the Environment a whole range of new statutory powers to control building and mining activity in archaeological areas. I have heard it argued by very reasonable and sensible people that in a large number of cases these powers are unnecessary, and that in most instances there is in fact a great deal of co-operation between county archaeological committees, officials from the noble Baroness's Department and any contractors involved. It has indeed been suggested to me that this cooperation might be impaired rather than enhanced by the introduction of these statutory powers. While I understand the anxieties of those who are sceptical of the value of new statutory powers, I think I would take the view that the Part II powers proposed in this Bill are justified and, indeed, that no responsible contractors or mineral extractors would have anything to fear from their operation. It has been put to me that the performance of the responsible operators was admirable and very good, and that they challenge anybody in the noble Baroness's Department to say "Nay." What a fine example.
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However, it was put to me that the exemption from the application of this Bill to the Crown ought perhaps to be looked at because, in the opinion of some people who have spoken to me, this partly nullifies some of the good which would come about, because in the past certain semi-Crown bodies, such as the Post Office, have been bad co-operators with archaeologists. I should be grateful if we could have confirmation that the Minister's Department would be able to bring that home to the Post Office.
Also I should like to query the effects of designating areas on which works have already begun. Will arrangements be made for compensation for the delays which will ensue? I know the noble Baroness said that delays would not normally come into it, but I am referring to works which have already begun, which is a slightly different point. However, I think it is important, and I am sure the noble Baroness will agree with me on this, that where co-operation already exists the emphasis should always be on maintaining and strengthening it rather than resorting to the heavy hand of Statute. I am sure that in practice the departmental officials, who have hitherto conducted their activities on the basis of goodwill, will continue to do so, and I am sure that the noble Baroness can give us full assurance of this: indeed, she has already done so. Incidentally, I had a letter this morning from Professor Cunliffe, particularly commending Part II—and I quote:
"as being a most imaginative and helpful innovation".
Properly used, this Bill should do everything to encourage co-operation between all parties concerned and a responsible attitude towards the conservation of our heritage. I am sure that the noble Baroness will agree with me when I say that in most cases this responsible attitude exists already. Firms such as Lloyds Bank, Debenham, the Laing Group and the Amey Roadstone Corporation have been of great assistance to professional archaeologists and have in many cases been willing to go to some considerable inconvenience and expense to be so. Their attitude is an example to us all, and I am sure that the noble Baroness will join with me in commending it.
My Lords, in any modern society there is no doubt that economic growth and

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archaeological heritage do not naturally co-exist. Methods have to be found to reconcile competing claims. Without new commercial and industrial development we face impoverishment, but if we neglect our heritage from the past we face a spiritual and cultural improverishment which is perhaps even more disabling. A morning's work with a bulldozer can destroy centuries of history. This Bill will help to control the bulldozers and lessen these risks. I commend the Bill to your Lordships and look forward to its Committee stage, after which we shall have a measure of which I hope we shall all be proud.
3.36 p.m.
Earl GREY: My Lords, we on these Benches also welcome a Bill which will help to preserve our ancient monuments and also ensure in this day and age, when progress demands that we have to designate more areas for dwellings and factories, that before this is carried out we are not destroying forever an historical monument or the remains of a past civilisation. I support the provisions in the Bill giving scope for archaeologists to investigate before any decision is made for work to be undertaken in places of archaeological interest. It is important to realise that urban and countryside areas are given the same consideration, and I am glad that this was emphasised by the noble Baroness in her speech. It has been asked of the Department of the Environment that protection of ancient trackways and green lanes of historical interest should also be incorporated into the Bill. While I believe in the safeguarding and welfare of hedges and ancient bridlepaths, I also believe that, because of the scope of operations involving maintenance and accessibility, they should be dealt with under a separate Bill.
There is great worry concerning the destruction and vandalising of ancient monuments. One has seen what has happened to Stonehenge and the measures that have had to be taken, with expense and inconvenience to the general public who have a genuine interest. An article in the Evening News of 1st February, pointed out the problems of increasing numbers of tourists causing these monuments to be eroded. The article men-
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tioned Canterbury Cathedral, where 5-inch floors have apparently been worn down to an inch. Buildings such as the Tower of London, Tower Bridge and Canterbury Cathedral are a vital link with our national heritage and are also important to our economy. I believe they must be protected at any cost. I welcome the measures taken to ensure that private owners of protected monuments are responsible for and have an obligation to maintain and preserve any area that has an archaeological interest. The section in the Bill relating to grants should be an encouragement and an incentive.
I am also pleased that action will be taken regarding the misuse of metal detectors, although their use will be permitted. Too many times in the past, through ignorance and inexperience, amateurs have unwittingly destroyed valuable articles and traces of history. We on these Benches in the main support this Bill and look forward to its reaching the Statute Book.
3.39 p.m.
Lord MIDDLETON: My Lords, as the noble Baroness has said, this Bill consolidates existing law on ancient monuments and makes new provisions. Under the present rules I myself, through having an interest in the surface land, am responsible for the preservation of a number of ancient monuments and sites. I am periodically reminded by the Ancient Monuments Department of the DOE of my statutory duties in respect of a complex of prehistoric remains in the form of earthworks and burial places, and I am consulted when it is desired that a new find should be scheduled.
I am periodically reminded by the DOE of my obligation to preserve a Norman castle; but as it was built of wood and burned down in the early part of the 12th century, this particular burden imposed by the State is not too heavy. I am also a party, with the Secretary of State, to a deed of guardianship in respect of an ancient medieval village site; and, finally, I have a duty to keep in repair a ruined 13th century church. This liability is rather more expensive than the maintenance of the parish church which replaced it and which is in current use. I have therefore some experience of the existing rules. I find the Departments concerned

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fair and reasonable and always helpful, and I believe that this is an experience shared by owners generally.
In regard to the Bill's new provisions, I shall be very brief in asking the noble Baroness whether she will in due course elucidate two matters. The first is the provision in Clause 10 which gives to the Secretary of State compulsory powers to acquire ancient monuments in order to preserve them. At present, as the noble Baroness has just said, the normal procedure is to enter into a guardianship agreement with the owner of the land. I referred just now to the agreement to which I myself am a party, and it works very well.
The Bill retains these arrangements by virtue of Clause 12 and, at present, as the noble Baroness has just reminded us, failing agreement with the owner, the Secretary of State can make a compulsory guardianship order when a preservation notice or order is in force and the monument is liable to fall into decay. The noble Baroness has told us that this is not working very well, but one is always reluctant to see the extension of compulsory purchase powers, as is provided in Clause 10, and, furthermore, it is difficult to reconcile this provision with the statement in the Financial Memorandum of the Bill that,
"Any increased expenditure with respect to ancient monuments is likely to be insignificant".
From what has been said by the noble Baroness, it seems that there have been cases where existing powers have been insufficient and the Government therefore feel that they must introduce compulsory acquisition. We may have to refer to this subject again at a later stage.
The second point that I have in mind relates to consent to carry out works under a general order made under Clause 3 and Clause 60. The Bill introduces a new procedure which is something like the planning procedure. Anyone who wants to do work affecting a scheduled monument would have to get the Secretary of State's consent if the proposed works could damage, destroy or demolish the monument, or if they are works of removal, repair, alteration or additional works of flooding or tipping. I think the noble Baroness reminded us that at present an owner has to give three
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months' notice if he proposes to do any work that would affect a monument, in order to give the Secretary of State a chance to serve a preservation notice.
It appears that this procedure is ineffective; indeed, the noble Baroness has referred to damage by agricultural machinery. But there is a large number of scheduled monuments which lie underneath farm and forest land and which are in no way harmed by normal cultivations or by woodland management. It is important that the new procedure, if it is to be effective, should not be too restrictive. No farmer would wish to damage an ancient monument, but neither would he wish to have to get consent for every act of cultivation. Perhaps the noble Baroness can tell us what kinds of operation will be deemed to have consent under a general order made under Clause 3 and Clause 60.
Clause 35 deals with areas designated under the Bill as of archaeological importance. Clause 37 deals with exemption from offence under Clause 35. Perhaps the noble Baroness can also tell us what kinds of agricultural and forestry operations will be included in a general exemption order under Clause 37.
There is one other point that occurs to me, but I would not ask the noble Baroness to comment on it at this stage, because it is not in the Bill as we now see it. When a highway authority puts into motion the procedure under the National Parks Acts and the Countryside Acts, after a claim that certain footpaths should become public rights of way, then that claim can be opposed and a public inquiry called. If the paths cross a scheduled ancient monument and are likely to damage the sites and render control over the sites by the Ancient Monuments Department either difficult or impossible, then the owner and the department can say so at the inquiry. But the inspector, under present rules which are not altered by this Bill, is not allowed to take such matters into account. In deciding the case, he is restricted solely to consideration of whether the paths were, or were not, used by the general public over a specified period. If a site has recently been scheduled and enclosed and protected, he has to disregard that fact altogether. It is not a satisfactory state of affairs.

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Subject to further information on the points that I have raised and to which we may refer again at a later stage, I am sure that a Bill which seeks to ensure, as this one does, the preservation of our ancient monuments and our archaeological remains must be as welcome to your Lordships as it is to me.
3.47 p.m.
Lord KENNET: My Lords, this is the last in a long series of Bills, a series which was promoted in the closing decades of the last century by the grandfather of the noble Lord, Lord Avebury, and I am delighted to see that the noble Lord is to speak in the debate this afternoon. For 20 years, Mr. Lubbock, as a Member of the House of Commons and then as Lord Avebury in the House of Lords, sought to promote legislation something like this, and failed, so deeply entrenched were feelings, especially in this House, about the sacred laws of property. When, at last, an Act of Parliament was passed in, I think, 1900 or 1901, it merely permitted the State and the owner of an ancient monument to enter into an agreement for the preservation of the ancient monument. It was one of those beneficial Acts of Parliament which permit people to behave well. It is always a good plan to permit people to behave well before you start punishing them for behaving badly.
However, in due course the attitude of the State toughened, and it was in 1913 that the first element of compulsion was introduced into the law for the protection of ancient monuments. It was done by means of the establishment of a class of persons called inspectors of ancient monuments, who had certain closely defined statutory duties and statutory powers which were quite pronounced and advanced. They were allowed to go and look at anything and were also allowed to recommend to the Ancient Monuments Boards that the remain, ruin or whatever it was should be scheduled, from which time State protection bit. These persons figured in the 1913 Act, as large as life. That Act said that the Minister, whoever it was in those days, shall appoint inspectors of ancient monuments.
The Bill before us today, besides providing for many good new things, contains repeal provisions, and one of the things
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which it repeals is the corps of inspectors of ancient monuments. They are silently abolished in the Bill as drafted. Maybe that is a good thing; maybe it is not a good thing—I do not know. I was rather surprised when I saw that that was what was happening: that after 65 years of honourable and useful history there is no longer to be such a thing as an inspector of ancient monuments.
He had his statutory position. He operated directly under statute law himself. Nobody could stop him from doing what he thought was right. He reported to the Ancient Monuments Board and they then scheduled the ruin. The present Bill will have the effect of transferring those functions to the Secretary of State for the Environment, who is, of course, a rather busy man. How will he carry them out, and through what body of persons? He will no longer be bound by law even to employ qualified persons, I think, for this purpose. Will it not just all be lost in general Civil Service action? There could, of course, be a case for abolishing these specialised statutory creatures, but I think that that case ought to be examined by the House alongside the status of other specialised statutory inspectors.
Who are we thinking of? What is the statutory position of the Health and Safety Executive since the amalgamation of all the old health and safety inspectorates? And what is the statutory position of certain local officers? What classes of persons survive who are named in statute law as having certain powers and duties? And so long as any survive, why should we consider removing the inspectors of ancient monuments from that class of persons? Why should we abolish them? I do not say that it is wrong, but I think that we should go into it, and I hope that my noble friend will today give to the House that information so that we can consider it at the Committee stage.
Assuming that the inspectors are abolished and assuming that the House thinks that this is done with good reason, we have to turn to the question of scheduling itself. The power to schedule a ruin, or whatever it may be, rests, and has rested historically, with the Ancient Monuments Boards of England, Scotland and Wales. The Bill transfers away that power from the Ancient Monuments Boards and puts

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it on to the already generously piled plate of the Secretary of State. What, then, will the Ancient Monuments Boards do in the future? Are they abolished, too, by this Bill? I am not quite clear whether or not the legislation setting them up is repealed. Perhaps my noble friend could explain that to us also. If the Boards are not abolished, what remaining functions will they have?
After speaking about the existence of the inspectors, perhaps it is only a point of detail to mention the power of access which they have at present. They can go on to the ground of any ancient monument anywhere and see how it is being maintained. What happens to that power of access if the statutory inspector is abolished? At present, the inspector has the power to inspect ancient monuments which are in State ownership and to see that the State itself is looking after the ancient monuments which it owns. Will that power continue and, if so, who will continue to exercise it, given that under the Bill there will be no more inspectors? All this needs to be clarified. There is a passage in the Bill which suggests that this power is being explicitly abolished. It is the passage which states that nobody shall have the power to go into a State owned ancient monument and see whether it is getting on all right.
So much for the inspectorate. There is another thing which makes my hair stand faintly on end, but perhaps my noble friend will tell us something which will cause it to sit down again; namely, the introduction of the power to terminate guardianship. My noble friend mentioned this point in her opening speech. Guardianship is not ownership. It is when the State takes over the maintenance of an ancient monument and becomes responsible for its upkeep but does not become the owner of the bricks and mortar. Nevertheless, it is virtually the same as ownership. It is all done with public money and it is all done by public employees.
Why should the State wish now, 65 years later, to take the power to terminate the guardianship of this monument or that? What kind of monuments does the Department have it in mind to dispose of? Why should the State be able to dispose of an ancient monument when the National Trust is not able to dispose of its houses
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without coming to Parliament for a special Act in each case? What about the law as it governs national collections in museums? Why is it that ancient monuments are to be singled out for easy disposal when compared with National Trust property and museum property? Prima facie, it would seem that they should have at least the same degree of entrenched protection as do National Trust houses. When she comes to wind up the debate this afternoon, perhaps my noble friend could tell us why that has been put in.
My last point is one of curiosity regarding Section 49. My noble friend introduced Section 49 as being connected with historic buildings legislation, not ancient monuments legislation. The House will remember the difference between ancient monuments, which are almost all ruins, which are not very numerous and which are of immense and obvious value, and historic buildings, which are not ruins at all, which are very numerous and which vary in value from the immensely valuable right down to the merely interesting. Section 49 empowers the Secretary of State to make grants to something called the Architectural Heritage Fund which was established as a charity in 1960. Would I be displaying amazing ignorance if I said that I had not heard of it and that I did really not know what it was, and that when I was administering this branch of the law from the chair where my noble friend now sits in the late 1960s we never used it? We were never aware of the possibility of such a fund coming into play. I am all for empowering the State to make grants to everybody, but perhaps my noble friend could tell the House what this fund is, what are its terms of reference and who administers it. Then I feel sure that the House will welcome the proposals about it.
As to the rest of the Bill, I am as much in favour as earlier speakers have been of the powers it takes regarding archaeological sites. They are clearly overdue. It seems to me as though those powers have been quite rightly devised. Therefore, I wish the Bill an easy passage through the House, subject only to satisfying explanations on the one large and the one small point which I have raised.
3.57 p.m.
Viscount HANWORTH: My Lords, I rise primarily with the object of briefly

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supporting this Bill, but first I must declare an interest. My wife is one of the new field monument wardens visiting scheduled monuments and reporting back to the Department of the Environment. Her parish covers most of Hampshire, the Isle of Wight and some of Berkshire. I immensely enjoy accompanying her, seeing the country and taking a non-active part, except for map reading and holding a levelling staff on what are sometimes the most exposed parts of the country.
Seriously, however, ancient monuments are a part of our national heritage which is being eroded in so many directions. Moreover, archaeology and the history which it records is very far from complete. There have been, and will be, very great improvements in the technology of excavation, and the information which can be obtained from modern excavation is vastly greater than it was even, say, 10 years ago. One might think that because, for example, several barrows in an area have already been dug there is no particular reason for preserving the others. But this is not the case because, if left to posterity, they may be able to learn a great deal more from them than we can, even with our modern techniques. We are only custodians of our heritage and we should not squander it. There may be just a few people who think that the study of the past is unimportant, but to those few I would simply say that, having considered the basic necessities of human life, this applies to almost all ! other human activities.
Returning to the Bill, as has already been said, it is a partial consolidation of all legislation since 1913, but there are differences and some points which I think might receive further consideration. It would seem that the status of the qualified Department of the Environment Inspectorate may have been downgraded in the Bill—I think that this has already been mentioned—in so far as there is now no provision for their opinions to be heard. Guardianship—which again has already been mentioned—is a scheme whereby an owner of, say, a castle can hand it over for the purposes of repair and surveillance in perpetuity. It now seems much more of a transitory nature than it originally was and apparently it could even be voided solely on the fiat of the local authority. It seems to me
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whether one wants to reduce guardianship, or to make it possible for it not to continue, it certainly ought to be at the very highest level and definitely not with the local authority. It would also appear that any Government Department getting possession of a scheduled or listed site could similarly on its own fiat do what it likes. I think the Minister said this and I am quite sure that it really is a mistake, and it would seem that if we are taking these powers to deal with other owners of the land it really is rather bad to say: "Well, we don't trust them but of course no Government Department can ever do any wrong". For that reason alone I think it would be right not to exclude the Government Departments. I simply ask the Government seriously to consider these matters, particularly because the number of experts—and I am certainly not one—who may be available for the Committee stages of this Bill, here and elsewhere, is probably limited.
4.2 p.m.
Viscount MONCKTON of BRENCHLEY: My Lords, first, I must declare a double interest, in that I am an amateur archaeologist, a past president of the Kent Archaelogical Society and a small owner-occupier farmer, so in a matter like this my loyalties are slightly divided. We, the British, are in the state that our ancestors were in about 1,500 years ago and perhaps I may remind the noble Baroness, Lady Stedman, that the downfall of Rome came not by force of arms from outside; it arose from the minting of coins and over-taxation. That was the sole cause of the destruction of Rome; let us pray that our destruction is not achieved in the same way.
It is good that a Lord Avebury should be speaking later in this debate, because his grandfather—I suppose it was—used to come down to my part of the world in Kent to see the result of excavations, and yet one sees the damage that was done by puritanical people and by farmers in the areas where he did his main research and, indeed, round Stonehenge itself and many other megalithic tombs which were themselves originally holy sites and shrines but which were pulled out for religious reasons. The Roman Church, being more wise, usually consecrated the existing megalithic pagan sites to Church use, and many of the early village churches in this country have megaliths built into

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them so that the spot remains sacred or at least undamaged.
Another general point which I should like to make is that excavation itself is for the most part total destruction, and one must be very careful not to push for excavation every time. Equally, the new methods of farming and of deep subsoiling are causing havoc with sites yet undiscovered. This is a problem which I believe comes under this Bill and I believe the Bill to be good.
I am not sure about the idea of altering the system of treasure trove. I have worked archaeologically in other countries where they have a similar system with the State owning everything found in the ground, but not everything found underground gets to the State; it is hidden away and often exported. Look at the case of the Elgin Marbles in London. Another suggestion made by the noble Baroness was that any finds should be given to museums. I would suggest that the word "offered" would be better; there is too much material in most museums. Not far from here, Samian ware pots which were put together from shards have been rebroken in order to be stored because there was not room for them when they were whole. It might be a good thing to put them on view near where they have been found. If churches were safe nowadays (which they are not) that might be a place to exhibit some of the best finds. National Trust houses and places such as Leeds Castle, which is now a separate foundation, could hold finds, but I suggest that for the most part the museums are cluttered up with prehistoric and Roman material.
However, finds by themselves are useless unless they are recorded. Equally, we must make it easy for the man who finds something to report it. As a farmer, I can see that, if I suddenly saw the footing of a Roman wall in my best field which grows the best crop every year, I might not report it. In fact, I should report it because I am very keen on such things, but my neighbour might not. I think it must be made easier for him so to do, even though the place then becomes a site. If he then wants to keep the thing that has been found and recorded and printed, well and good. On our own farm last year we discovered an early second century Roman burial—or, rather, cremation—and the
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vessels that go with it. I then got the Kent Archaeological Rescue Unit with Mr. Brian Philp to come down and do a rescue excavation. He found two more glass vessels, a painted pot and a small poppyhead beaker and guessed rightly which field the occupation site would be in. I then dug a series of trenches with a miniature bulldozer (which was Japanese, I fear) because with that I could see and delineate the area to be excavated. That area is a minimum of two acres. We found over 1,500 shards of first and second century pottery on two acres, in a series of 20 trenches. That will be excavated by the Kent Archaeological Rescue Unit in April. It will take a year to complete—not four months and two weeks, which I think the Bill suggests.
On certain sites, an even longer time will be required. I hope this point can perhaps be looked at. I know it is against my farming interests but it is certainly in the interests of archaeology. The Roman level on our site is at about 3 ft. 6 inches, and it means that we have to move 10,000 tons of soil, mostly by hand, although the modern bulldozer used archaeologically under control is quite good at moving some of the topsoil. The Dover site on which the Rescue Unit have been working, where the famous painted house was found, is at a depth of 20 feet of soil which has to be removed over four acres. They have completed half within five years. Four months and two weeks would not have met that case very easily.
On the other hand, in Schedule I, Part I, paragraph 4, page 60, it says that the owner who wishes to get consent for a change goes to the inspector and he will give notice in due course. No period of time is specified and that is hard, particularly on a developer, as opposed to a farmer. A man is just about to develop a site in Dover and there is another site in the chalk pits at Darenth in Kent where work has been held up for a long time. There is no limit to the time the poor owner has to wait before the decision is given. The man with the Dover site has waited 11 months and the developer has already lost half a million pounds. In the case of the Darenth chalk pit site, the inquiry was held last April and that is a £2 million project. I should have thought that about 90 days would be sufficient if the inspectors were expert; if not, I should get new inspectors.

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My Lords, I am keen on this Bill. I wish it well and I hope that some small amendments may make it better later on.
4.10 p.m.
Lord WILSON of HIGH WRAY: My Lords, I am not a professional archaeologist, but for some reason I have never been able to understand I was for three years President of the Cumberland and Westmorland Antiquarian and Archaeological Society and I was appointed a Fellow of the Society of Antiquaries of London, so I know a little bit about it. I should like to give this Bill my fullest support. I think it is a much needed and an excellent Bill, though possibly some of the modifications which have been suggested by other noble Lords should be made to it.
Your Lordships will be glad to hear that the noble Baroness, the noble Lord, Lord Mowbray and Stourton, and the noble Earl, Lord Grey, have in fact said everything I was going to say about Clause 42, which deals with metal detectors. I should like only to stress what the noble Lord, Lord Mowbray and Stourton, said. I regret that the provisions regarding getting permission for the use of metal detectors are confined to scheduled sites. I agree with him that it would be difficult to do otherwise. I live in the second largest and one of the most sparsely populated counties in the country, and there are a lot of people getting metal detectors and going round on unscheduled sites digging holes in fields. They appear to think that, if they get permission from the farmer who owns the field or from the tenant, they can do as they like. I believe also that very often they do not fill in the holes and that causes agricultural difficulties. There is no need for me to repeat what has already been said, and I wish the Bill well.
4.12 p.m.
Lord AVEBURY: My Lords, unlike the noble Lord who has just spoken, this is not a subject on which I have had occasion to inform myself in the past, nor would I normally have ventured to express an opinion to your Lordships but for the fact that, as the noble Lord, Lord Kennet, remarked, my grandfather was very persistent in seeking legislation
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for the protection of ancient monuments. He started in 1873 with the introduction of a Private Member's Bill which called for the appointment of a National Monuments Commission which would have prepared a schedule of monuments over which it would have been possible to exercise powers of restraint. An owner who wanted to injure a monument would have had to serve a requisition on the Commission and it would then have had to either purchase the monument or consent to the injury. There was a right of appeal against that power to the courts. The Commission was also to be empowered to spend money on preserving scheduled monuments with the consent of the Treasury. I mention these historical details to show that sacred rights of property, as the noble Lord, Lord Kennet, called them, were not so universally respected in the 19th century as some people imagine, and that the Liberal Party, to which my grandfather also belonged, were not in the 19th century the arch exponents of laissez faire and preservation of individual rights, as they are sometimes painted; they did have regard to far wider interests, as this example shows.
My grandfather introduced his Bill no less than nine times before, finally, in 1882 it was taken over by the Government and was successful, but in a rather truncated form. In speaking about the Bill which he had introduced earlier, my grandfather mentioned as a particular example the threatened destruction of the great stone circle at Avebury. Among other acts of vandalism which spurred him on to continue his effort to secure legislation, he mentioned that in 1875 a large number of the stones were in fact broken up for the sake of a few shillings' profit. He wrote in the journal The Nineteenth Century of April 1877 of how a contractor had set bonfires around the stones and when they were sufficiently heated he threw cold water on them so that they were cracked; he then broke them up and used them as rubble for the construction of roads. Then a large part of the site was purchased by a building contractor who proposed to erect a housing estate on it. Fortunately, a rescue operation was mounted in time to prevent that particular act of desecration. My grandfather went on in this article

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to enumerate many other works of outstanding national importance which had been obliterated by speculators for what he called paltry and trifling reasons.
My Lords, today, through such successive legislation, we have had a steady enhancement of the power to stop what I would call criminal acts of that kind, but at the same time the pressures of development have also increased. I do not think, from the speeches we have had so far, that anyone is likely to disagree with the general sense of the legislation which is now before the House. The replacement of existing provisions for giving notice of work on scheduled monuments, interim preservation notices, preservation orders, guardianship orders and agreements under the Field and Monuments Act 1972, which the noble Baroness rightly called cumbersome, by the scheduled monuments consents under Clauses 2 and 3, I have no doubt will be effective and will bring this procedure more into line with the listed buildings applications, except of course that an appeal against refusal is to a person appointed by the Secretary of State since he cannot determine appeals against himself.
On that subject, I may say that I do not like the principle which we find in so much legislation being brought forward now, where Secretaries of State appoint a person to act in a quasi-judicial manner in a cause where the Secretary of State is personally interested. We find that not only in the present Bill but in the immigration law, where the adjudicators are appointed by the Secretary of State for Home Affairs. I would suggest to the noble Baroness—although she may say this is a minor Committee point—that the persons who are to be appointed to hear appeals against decisions of the Secretary of State might perhaps be appointed by the Lord Chancellor instead of by the Secretary of State himself.
I should now like to turn for a few moments to the matters raised by the noble Lord, Lord Kennet, which I think are of great importance, and I hope that the noble Baroness will respond to the invitation which he gave her to explain some of these matters in somewhat greater detail before we proceed to discuss them at Committee stage. I do not think the noble Baroness mentioned the inspectors
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at all in her speech, but it is a more remarkable innovation than even the noble Lord, Lord Kennet, made out, because inspectors have been part of the legislation ever since the first Act of 1882. If I am permitted to quote from the record of another place, this is from Hansard of 11th August 1882, column 1600, where my grandfather himself said:
"As regards the present Bill, while it is no doubt a step in the right direction, especially in providing for the appointment of an inspector …".
He obviously thought that was a very important provision, that the inspector, a corps of inspectors, was an absolutely essential provision, and successive Governments have continued to hold that view right up to the present day. There is no explanation in the Memorandum as to why they have disappeared, why Section 16 of the 1913 Act has been repealed, which mentioned inspectors specifically and gave them certain powers, which presumably they continue to exercise as employees of the Secretary of State, although we do not find any reference to that anywhere in the Bill.
There is the parallel matter which the noble Lord, Lord Kennet, also mentioned, that the act of scheduling has hitherto been the responsibility of the Board and this is now to be transferred to the Secretary of State. Those who have raised this matter with me have pointed out that it undermines, indeed eradicates, the principle of impartial professional judgment which has been enshrined in all the previous legislation. Moreover, it opens the way to the making of decisions by administrators on their own initiative and without any reference to the professions.
I am as anxious as the noble Lord, Lord Kennet, about the provisions as regards the Crown. The exemption of the Crown from entry or from any of the other provisions of the Bill is a rather serious matter because the Crown, of course, is one of the largest developers. The Property Services Agency also, so far as I can make out, has no obligations under the Bill. Although the noble Baroness said that the Crown would abide by the spirit of the provisions of the Bill and I suppose that her remarks extend to the Property Services Agency—I am glad to see her nodding her head—I am not sure that your Lordships would think it satisfactory to rely entirely on an assurance from the Minister, because we all

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know that Governments can change and what a Minister says in either House has no statutory force and could not be tested in the courts. With the greatest respect, at some point during the Committee stage of the Bill, I suggest that we consider restoring an obligation to the Crown.
The noble Lord, Lord Kennet, criticised the provision for the withdrawal of guardianship of a monument and asked in respect of what classes of monuments the Government had it in mind to exercise these powers. I should like to know whether there have been any cases in the past where it has been desired to withdraw guardianship and, because of the lack of any such powers, the Government have been forced to continue acting in that capacity. For if we cannot point to any practical examples, I suggest that the Government have not had reason to come forward with this provision.
Before leaving the question of the inspectors I should like to make a tentative proposal to the Government for their consideration before the Committee stage. This is not a matter which I have discussed with any of the inspectors and therefore I am unable to say that it has their support. However, it occurred to me that, in order to preserve the independence of the profession, one solution which might be adopted would be for them to be employed not by the Secretary of State but by an independent body which could be either the Board or the Royal Commission. It struck me as an anomaly that we have these two parallel organisations: First, there is the Royal Commission—which, incidentally, is mentioned only once in the Bill, in, I think, Clause 40—-which has the function to record and measure monuments which may be liable to destruction through redevelopment, and to compile a national inventory of those monuments of national importance; and secondly, there is the Board, which has the function under the Bill—and this answers one of the questions raised by the noble Lord, Lord Kennet—to advise the Secretary of State in the exercise of any of his functions under the Bill.
Surely the body which collects all the information is in the best position to give the Secretary of State advice. There-
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fore, my proposal is that, either we abolish the Board and transfer its functions to the Commission or, conversely, we abolish the Commission and transfer its functions to the Board, and that we then envisage transferring the inspectors, who are to continue, as I understand it, to be the employees of the Secretary of State, to either the Board or the Royal Commission, whichever continues to exist. In that way we would preserve the professional integrity of the corps of inspectors who have served this nation so well in the past.
Subject to those minor anxieties I join with the rest of those who have spoken in giving a general welcome to the Bill, and express the hope that it will enhance still further the powers that we have for preserving our national heritage.
4.25 p.m.
Lord ABINGER: My Lords, my intervention in this debate will be short, because there are only two matters to which I wish to refer. However, before doing so I should like to say that I also very much welcome the Bill and know, from conversations with them, that many professional archaeologists do so as well. It is clear that the first part of the Bill in effect consolidates and modernises existing ancient monument legislation. I do not think that that legislation was ever very controversial. It was accepted by most people as being sensible, if not necessary, and therefore it can hardly be called controversial now to consolidate legislation which already receives general acceptance. I certainly have no quarrel with Part I of the Bill and I welcome the effort to update the legislation concerned.
Part II of the Bill introduces the entirely new concept in Britain of the designated archaeological area. I welcome that idea too, but I wonder how that concept will work in practice. It is attractive to suggest that it will be possible to designate these areas in much the same way as areas of outstanding natural beauty can be designated under the Town and Country Planning Acts, but I am not sure that the comparison is valid. The trouble might first be how to identify areas of archaeological importance. Areas of outstanding natural beauty can be identified easily and if they are designated the pastoral scene presented by them continues; the

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farming of the land continues without prejudice to the beauty of the area concerned; and industry can be kept away from the area. However, it seems to me that it will be often impossible to identify areas of archaeological importance in advance.
To begin with, in my view the majority of them lie beneath the surfaces of our ancient towns and cities—places like Colchester, York, Chester and even London. In the case of the smaller towns, I suppose that the intention, under the provisions offered by the Bill, might be to designate the whole of the town area; but how will that problem be approached in a large city like Edinburgh, Bristol or London itself? How are we to know what lies beneath the stones of our ancient towns or under which stones archaeological remains lie? The sites tend to be unearthed suddenly and unwittingly in the course of development in the towns. I am sure that archaeologists will welcome the provisions that give them a breathing space of four and a half months to examine the site if it has been designated, although very often I imagine that when these things happen the site will not have been designated at all.
I am not clear from reading the Bill how much notice of designation has to be given. If a site is unexpectedly turned up, is it too late to designate it, or can one, at the very last moment, through local agencies—perhaps local authorities—designate an area in a hurry? I could not make out from reading the Bill what was possible in that respect. It was mentioned earlier in the debate that any delay while the archaeological site is examined can be enormously expensive to the developer and also to a local authority, if a local authority is concerned with the matter at all. Delay could be very unfair to each. In the circumstances, perhaps the requirements of archaeology must take precedence. I do not know, but I think that great practical difficulties will arise from the implementation of that clause. What seems certain is that archaeological sites in towns can seldom expect permanent protection. In four and a half short months at the most they are likely to be buried again, possibly for centuries, possibly for ever.
Finally, what need not be lost for ever are the small archaeological artefacts
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which are found on the sites. In that context I am not altogether happy about Clause 54 of the Bill; nor do I think that the professional archaeologist would be. Among other things, the clause empowers authorised experts to enter sites and designated areas and to take into temporary custody archaeological objects found in them. Of course, that will be of some benefit to archaeological science, but is it enough? Except in the rare instances where the law of treasure trove would apply, these objects must be returned to their owner, who is either the owner of the land or the owner of the property in which they have been found. It is that lack of real protection for the smaller objects and artefacts which worries archaeologists so much.
I should prefer Clause 54 to enable the local authority in whose area the site lies to acquire such objects at a fair price by compulsory purchase. I do not think that property owners would oppose such a provision. The noble Lord, Lord Middleton, who I think speaks for property owners, may disagree with me, but I do not believe that they would get very excited about a provision to acquire archaeological artefacts by compulsory purchase. Frequently these objects are of very small intrinsic worth, but they often have a high scientific value and importance. I agree that it would be absolutely fair that their present owners should receive some compensation if such objects are compulsorily acquired, as indeed I believe almost invariably the finders of treasure trove are now compensated. Those are the few points that I wish to make. In all other respects I welcome the Bill.
4.34 p.m.
Baroness STEDMAN: My Lords, I am very grateful for the interest which noble Lords have taken in this Bill by attending and by making such very well-informed contributions to the debate. I am especially indebted to the constructive approach that all noble Lords have taken in making their speeches on the Bill. It is a complex subject and involves conflicts of interest. The traditional policy of the Departments has been to try to resolve such conflicts by negotiation, and we shall try to continue this policy in the administration of the revised and extended powers under the Bill, if Parliament

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enacts it. I can confidently assure the House that that will be so because it is well appreciated by the Inspectorate of Ancient Monuments and by its administrative colleagues that one gets more done by negotiation and co-operation than by compulsion. Nevertheless, those who are responsible for conserving our already very much diminished archaelogical heritage must have some reserve, reliable powers in order to carry out their job, if it is necessary.
The noble Lord, Lord Mowbray and Stourton, asked whether there would be any compensation for delay where works had begun before designation. The answer is: No. We shall have to publish the proposals, so there will be a period of warning and there will then be a further six months before the designation finally takes effect. In our view, this gives developers all the freedom from those provisions that is necessary at this time. Nothing can be retrospective. If works have started, then we must go through this process of designating the area, the further six months and so on, which ought to enable developers to co-operate with us.
The noble Lords, Lord Mowbray and Stourton, and Lord Wilson of High Wray, and, indeed, other noble Lords are concerned about metal detectors and their use, as we are. I can only refer all noble Lords to the first article of Treasure Hunting's code for thoughtful treasure-hunters, which has been published in its journal and which says:
"Do not interfere with archaeological sites or ancient monuments, but join your local archaeological society if you are interested in ancient history".
The Department is certainly willing to help as much as it can in the education of treasure-hunters, by giving advice or in any other way which is possible. However, we think it is very much better if an independent body, like the British Archaeological Council, would take the lead in this through its various organisations and branches.
This gives me an opportunity to stress a point which arises on the question of metal detectors. What I did not know until I started talking about the contents of the Bill is that the vendors of metal detectors have been asked by the Home Office to give purchasers a leaflet which
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refers to the licensing requirements. The Home Office suspects that many vendors do not comply, and that many of the purchasers who receive the leaflets do not even apply for the licences. However, there are about 80,000 licences already in existence and we understand that about 8,000 applications are in hand at the Home Office at present—I suspect as a result of many Christmas presents in the past couple of months. However, the licensing does not do anything to ensure that detectors are not improperly used on archaeological sites. But it is a point to stress, that if one does have a metal detector, one is still supposed to have a licence before one operates it.
The noble Earl, Lord Grey, raised the question of trackways and green lanes, and I think quite suitably said that this was not something for this particular Bill, although I am sure that, in the light of his interest and that of the noble Lord, Lord Avebury, in the Ridgeway and other places, we have not heard the last of trackways and green lanes and may soon hear something about them. The noble Lord, Lord Middleton, spoke with real authority; he is one of those who suffers or enjoys, as the case may be, being surrounded by so many of our ancient monuments. I am very glad that his experience of co-operation from our Department has been a happy one.
We regard Clause 10, concerning compulsory acquisition powers for the Secretary of State, as only a reserve power. It is something which we believe we must have, but we would use it only where it was necessary for the preservation of the monument, and for no other purpose whatever. On the question of agricultural land and the difficulties which arise when scheduled monuments are on agricultural land, the archaeological objectives there are to prevent the cultivation of monuments, including buried sites, which have never been cultivated, or perhaps not in recent years.
As other noble Lords have said, the intensification of modern agriculture has destroyed many sites and remains a threat to others. We want to keep under observation monuments where cultivation has been tolerated; we want to control and perhaps be able to stop cultivation where there is reason to believe that archaeological damage is being done.

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Cultivation of many scheduled monuments has traditionally been tolerated, but it is now known that in some cases, but not all, continued cultivation, even to the same depth, may be becoming increasingly harmful. For example, where the quantity of topsoil is decreasing by erosion or even from movement on a sloping site.
We are aware of these problems. The class consent will apply to all the monuments which are at present cultivated and have been cultivated in recent years. It will permit cultivation to a specified depth, and is intended to cover normal ploughing but not the exceptionally deep cultivation or drainage works. We are in touch with MAFF and with the NFU), and are having quite long consultations with them. We are reasonably confident that we are going to work out terms of consent in consultation with them that will be acceptable to the farming industry.
The noble Viscount, Lord Hanworth, was delighted to find one of our field management wardens. I understand they are an innovation. We think they are going to be of tremendous help to us. Thirty of them have just been appointed, and they have been given a certain number of monuments within an area to look after and keep an eye on; and I am delighted that the noble Viscount has been raked in by his wife to help in this. I shall certainly consider all the points he has raised and will write to him.
The noble Viscount, Lord Monckton of Brenchley, is a known enthusiast of many years' standing and we know of his deep and abiding interest in archaeology. I note his comments about finds being given or offered, and also that a longer time may be required in some cases to carry out the digs on the larger sites. We shall certainly have a look at that point to see whether we can suggest any strengthening of it, or any other means of negotiating for an extension of time where that is necessary. I will undertake to check on the other specific cases he raised, and will write to the noble Viscount before the next stage of the Bill.
The noble Lords, Lord Kennet and Lord Avebury, raised the question of the inspectorate. May I hastily assure your Lordships that the inspectorate is not to be abolished. The current approach is
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that the Ministers employ whoever is needed to carry out their functions. In the ancient monument field architects are no less needed than inspectors. Section 16 of the 1913 Act gave the inspectors the duty to report on the condition of monuments and the best modes of preserving them. This is an advisory function. It is not comparable to the statutory officials who carry out the executive, or quasi-judicial, duties in their own name. We are maintaining the inspectorate.
The Ancient Monuments Boards are also to be kept. Their specific function is in scheduling certain ancient monuments. That is repealed, but they have the specific function to advise the Secretary of State on this and other key functions under the Bill. This is spelled out in Clause 22, and more generally the Secretary of State will continue to look to them as his principal independent advisers on all matters relating to ancient monuments and archaeology. They have served us very well over the years, and we anticipate that they are going to serve us just as well in the future.
The noble Lord, Lord Kennet, also asked whether we had possible examples of where we might want to introduce the termination of guardianship. One possible example is where one generation of a family owning an estate where there is an ancient monument was perhaps indifferent to the ancestral ruins and the State stepped in and looked after them, but the next generation might very well be as enthusiastic as the noble Viscount, Lord Monckton, and want to look after their own monuments as the noble Lord, Lord Middleton, does, and might want to run them. In that case it might be much better for the Secretary of State, and for the public, to be able to have the powers of termination of guardianship and let them look after them.
There is also the problem which we see arising in the future where the State may be pressed to preserve less enduring monuments than the traditional ones. It may not be possible to predict with any confidence for how long that is going to be practicable, and if the commitment is irrevocable then the State would have to refuse it because we should have to have various safeguards. But the safeguards at the moment are that the owner must agree to the termination. If the owner

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does not agree to the termination of guardianship that is the end of it, and the Ancient Monuments Board must be consulted before we start any of the procedure for termination of guardianship.
I am delighted, as other noble Lords are, that Lord Avebury was able to be with us this afternoon to take part in this Second Reading debate, because his family must claim a great deal of credit for the ancient monuments work that has gone on throughout this century and before. I shall look at the point he raised about the appointment of persons to hear appeals. I know his feelings on this point from other aspects of government that we consulted, and I shall take advice as to whether this is perhaps a field in which those appointees might be appointed by the Lord Chancellor rather than by the Secretary of State. I shall write to him and other noble Lords about that.
The Crown will comply with the spirit of the Act. The present ancient monuments legislation does not bind Government Departments but they, including the PSA, always have good voluntary arrangements with my Department, not only to abide by the spirit of the legislation but, where possible, to do even more than may be statutorily required, as I understand they did on the excavations on the line of the M.3. I am sure this will continue, and it will be the earnest endeavour of my Department that it will do so.
The noble Lord, Lord Avebury, asked whether we had had any cases in the past where we would have wished to terminate guardianship. No, we have not had any cases up to this point of time; but the distinction with the National Trust is that the Trust can be, and is, ruthless in refusing offers in the first instance. The State comes under a different sort of pressure, and it may be right to accept a monument to save it for one or two generations even if permanent preservation may, in the end, prove to be too difficult or disproportionately costly for the maintenance of the monument. That is one of the respects in regard to which we would want to have these powers in reserve.
Lord AVEBURY: My Lords, if the noble Baroness is leaving the question of
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the Crown, could she make a brief reference to the provisions of Clause 50, where it is provided that no power under the Act to enter on any land shall be exercisable in relation to Crown land? In particular, one thinks of the powers of recording and measurement which are provided in cases of development. While the noble Baroness says that the Crown is very ready to comply not only with the spirit but to go beyond the spirit of the Act, the existence of a clause such as this implies that there might be cases where the Crown is developing its land where it would exclude persons who had a legitimate wish to come in and record, or measure, ancient monuments that were in the process of demolition.
Baroness STEDMAN: My Lords, I think, and I hope, that the noble Lord is unduly fearful about this. There are instances in regard to Crown land, particularly where land is being used for defence, where perhaps we would not be able to allow this. We are expecting that the same degree of co-operation will continue. I shall have another look at this point before we come to the next stage of the Bill, but we are reasonably confident that we have the full co-operation of those people who have the right to build on Crown lands with the exception, in certain cases, of national safety or national security, where defence and such matters are concerned. I will have a look at that and see whether we can strengthen it at all before the next stage.
The noble Lord, Lord Abinger, asked about the designation of areas of archaeological importance. Where the actual remains are discovered during development in an area which is not yet designated, an unco-operative developer could, if necessary, be stopped by scheduling with immediate effect. Compensation would then be payable for any loss or damage. The designation procedure takes approximately nine months to become effective, and therefore this is not something that happens overnight.
On the question of the scheduling of the archaeological areas, we all know, or suspect, that our country is very rich in things under the soil from past ages, but in practice we are not going to be able to designate overnight every area where we think there are archaeological treasures.

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The historians and the archaeologists at the moment do know and are able to advise us on the sort of areas in the town and countryside where they would expect to find something, and we know in advance where some major development is expected. We would be able then to designate in advance these areas so that we could safeguard what was still buried under the ground. But there will only be just a few areas a year, and it is not a question of wholesale designation of designated areas of archaelogical importance.
I note the noble Lord's comments on Clause 54 about the temporary custody of archaeological finds. I will have a look at that and consider it and write to him. When his Bill dealing with treasure trove and other things comes to us, I am sure that we are going to have many more complementary things to go with this Bill and with the others.
I hope I have covered most of the points raised. I will check with Hansard tomorrow. On those replies I have not given, or have not expounded in sufficient depth, I shall certainly take the opportunity of writing to noble Lords again, and will send copies to other noble Lords who have taken part, so that everybody knows where we have got to before we reach the Committee stage. My Lords, I beg to move that the Bill be now read a second time
On Question, Bill read 2a, and committed to a Committee of the Whole House.

PRICE COMMISSION (AMENDMENT) BILL
4.50 p.m.
Lord JACQUES: My Lords, I beg to move that this Bill be now read a second time. The basic purpose of the Bill is to amend the Price Commission Act 1977 to remove the provisions in Section 9 of that Act which guarantee companies a certain level of profitability during and following an investigation by the Price Commission into individual price increases, regardless of the Commission's findings. The Bill does not affect the safeguard provisions which apply following examinations by the Commission into whole sectors of industry, as opposed to individual firms. The safeguard provisions which the Bill seeks to abolish or amend were originally introduced into the Price Commission Act 1977 in response to
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concern expressed by industry about the powers granted to the new Price Commission by that Act. The Government always maintained serious reservations about the necessity for such provisions and believed that the Price Commission would be fully able to make provision for the essential requirements of individual companies without needing to be constrained to do so by detailed regulations.
The Price Commission have now been in operation for 18 months and it can be confidently stated, looking at the Commission's record over that period, that those fears which led to the introduction of the safeguards were greatly exaggerated. The Commission have demonstrated in report after report their sensitivity to the particular circumstances of each individual case and to the need for industry overall to maintain a sufficient level of profitability to finance innovations and investment. In almost every report it will be found that the Commission devote a chapter or major part of a chapter to the cash flow position and financial outlook of the company. Often the Commission's conclusions have been strongly influenced by companies' impending requirements for finance to fund capital developments. There is therefore no evidence that the Commission are insensitive to industry's financial needs.
The Commission have, on the other hand, indicated plainly that the existence of the safeguard regulations has proved a considerable handicap on its ability to operate effectively. For example, the safeguards were invoked in 20 of the 31 investigations into pricing by individual enterprises which the Price Commission have now completed. In nine cases, the notified increases were fully safeguarded, while in 11 other cases the increases were partially covered by the safeguards. There is no doubt that the existence of a set of rules which enables prices to be increased automatically, whether or not that increase is justified in all the circumstances, runs counter to the basic principles of the prices policy enshrined in the 1977 Act. For such a policy to be effective, each price increase notified should be examined on its merits and the Commission's recommendations based solely on their findings. The existence of safeguards which guarantee firms certain levels of profitability during and following investigations regardless of the Commission's

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findings about efficiency and competition, seriously narrows the scope for the Commission to make appropriate recommendations.
The passage of this Bill will not allow the Price Commission to restrain price increases indiscriminately with no regard to the company's profitability or plans for investment. The Commission will continue to be guided by the criteria in Section 2 of the 1977 Act in performing their functions. These criteria require the Commission to take account of a range of factors including the following: the need to recover costs; the desirability of making the best use of resources; the need to defray the cost of capital, including the compensation for risk element; the need to take into account changes in prices in determining the value of assets; and the need to finance innovation, improvement and expansion. One would almost have thought those guidelines had been prepared by the CBI, they are so generous and liberal.
The efficient company has nothing to fear from the Price Commission either now or after the passage of this legislation. What the passage of the Bill will secure is that it will no longer be possible for an inefficient company, using the automatic price increase that safeguards allow, to pass costs on to the consumer without even considering the possibility of absorbing some through greater efficiency. If the Bill helps to prevent this sort of action the consumer will benefit, and in the long term so will the company concerned, if, as a result of an investigation by the Price Commission, it is encouraged to adopt more efficient methods.
The Government have never argued that the work of the Price Commission would lead to a massive reduction in the rate of inflation. The work of the Price Commission has certainly made a contribution to the remarkable reduction in the rate of inflation which we saw last year, but it has never been expected that the Price Commission would have a quantifiable effect on the cost of living overall. The Price Commission operate on a selective basis; their role is to prevent unnecessary price increases, but not to act as an agency of control across the board. The Government are seeking through this Bill simply to make this selective control more effective.
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I believe price control as we have it today is modelled on our needs. In our economy we have certain spheres where there is competition which goes a long way to controlling prices. In other spheres we have imperfect competition; we have many instances where the market is dominated by one or two market leaders and there is imperfect competition so far as price control is concerned, so that there is need for an agency. And of course we have, as a third category, absolute monopolies including State monopolies.
In such a mixed economy it is not necessary to have rigid controls across the board. That is costly to administer and is costly to industry. In such a mixed economy we require selective control, and that cannot be expected to have, and will not have, a fundamental influence on the retail price index; it cannot have. It is, alternatively, simply part of the monopoly legislation; it is part of the legislation which tries to prevent unnecessary price increases from being passed on to the consumer and is quite different from rigid, inflexible price control in its effect on the RPI. That is the kind of price control we have now and I should have thought that, because of the liberality behind it and because it is modelled to suit our economy, it would have had all-Party support.
I wish to draw attention to one factor which has been ignored by opponents of the Bill but which is of fundamental importance. This is the matter of the Price Commission's ability to allow price increases apart from the application of the automatic safeguards. While the removal of the automatic safeguards will prevent companies from putting up their prices, the Commission will continue to retain its discretionary power to allow interim increases during the course of an investigation and subsequently. Critics will argue that this is all very well but the Commission is not obliged to use its discretionary power and it is therefore unlikely that interim increases will be granted. To those critics I would merely point out that the Commission has already found that circumstances justified the exercise of this discretionary power on several occasions, and that was done in addition to the provision of the automatic safeguards. There are undoubtedly a number of cases where the discretionary power to grant

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increases would have been used if the price increase under investigation has not been covered in whole or in part by the automatic safeguards. I am confident that the Commission will continue to use its discretion wherever appropriate. This will take more account of the public interest than is taken by the present automatic regulations, over which the Commission has no control.
The Bill has reached this House with the addition of a new clause which relates to the duration of the Bill. The Government accepted the clause, which will limit the life of the Bill to 12 months unless it is renewed annually by Order in Council preceded by an Affirmative Resolution of each House. My right honourable friend the Secretary of State made it perfectly clear in another place that the Government are not entirely happy about this clause. The Government believe that the increased powers which the Bill will give the Price Commission are right and necessary, and that ideally the Commission should be given these powers on a permanent basis. However, the Government are conscious of the support in Parliament for an annual review and have therefore agreed that this clause should be added to the Bill.
This, then, my Lords, is the Price Commission (Amendment) Bill. It has been suggested that the Bill will create a lack of confidence in industry and lead to a lack of investment and to greater unemployment. I believe, that because of the guidelines—the very generous and liberal guidelines—laid down in Section 2 of the 1977 Act it cannot possibly do so. I therefore reject the contention that it will create a lack of confidence, but I should add that if there is irresponsible, ill-informed, or exaggerated criticism of the Bill, that, rather than the Bill itself, will create a lack of confidence. The Price Commission has already shown in its reports that it is operating with distinction, common sense and judgment. The removal of the safeguard provisions will allow it to continue the task that it has begun so well, but with even greater benefit to the consumer and the economy as a whole. My Lords, I commend the Bill to the House, and I beg to move that it be read a second time.
Moved, That the Bill be now read 2a.—(Lord Jacques.)
5.3 p.m.
The Earl of GOWRIE: My Lords, for my part I am glad to welcome the noble Lord, Lord Jacques, back to the Government Front Bench, and I congratulate him upon the fighting spirit which he showed in presenting this invidious little Bill to the House. Since it has been publicised as the last plank in the Government's counter-inflation platform—the others having gone up in flames—it really should, in my view, have been presented by a Member of the Cabinet: say, the noble Lord the Leader of the House, or the noble and learned Lord the Lord Chancellor. But, as always, when there is a thoroughly nasty piece of work to do—it was just the same when we were in office—it is a case of, "Send for the Lords in Waiting." Like the boy in the poem, the noble Lord has stood on the burning deck whence all but he had fled, as I do not notice that any noble Lords from behind him have put down their names to support him this afternoon. Again like the boy in the poem, the noble Lord has acquitted himself with courage and tenacity. We are very glad to see him back, and we are only sorry that it is likely to be for such a short time.
It really is extraordinary that the Government should sandwich this supposedly most important remaining plank of their counter-inflation platform between the Ancient Monuments and Archaeological Areas Bill and the Arbitration Bill. This is surely a Freudian slip on the part of the Whips' Office.
My guess is that this Bill is the last piece of legislation on prices and incomes matters—legislation as against statements of intent, solemn and binding agreements, and the like—that the Government will in fact present to Parliament. It was rushed through the House of Commons entailing an all-night sitting for the Committee and following stages, with a great fanfare of urgency, suggesting that here was in fact a positive response to the industrial crisis and the inflationary consequences of the breakdown of the Government's 5 per cent. pay norm. And yet the Bill is by definition, and deliberately, entirely negative in its intentions. It is designed to remove the present safeguards—that is to say, the safeguards which the earlier Bill, the Government's own Price Commission

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Bill, had contained—which guarantee a minimum level of profitability for companies subject to investigation by the Price Commission.
Your Lordships will be aware that there are two safeguards: one applies during the period of investigation by the Commission, and the other, which I think is less valuable, applies after the Commission has finished its inquiry. The present Bill seeks to abolish both. Yet nothing has changed since the Secretary of State agreed earlier to the safeguards. They were introduced because the CBI and others argued at the time of its passage that the Price Commission Act bestowed an undue amount of discretion on the Commission and on the Secretary of State. This was worrying because the Act contained potentially ruinous powers to freeze prices, even before the Commission had passed judgment on any particular proposed price increase. In view of the threat to profit, and the general uncertainty of this method, industry needed some assurance that there would be a limit to the extent to which the Commission would be able to depress profits. The Secretary of State himself accepted the argument and built in the safeguards.
Since then nothing has changed—or I may be wrong in saying that; if anything has changed, it has surely changed for the worse. Profitability in British industry is still critically low and needs to increase to finance more jobs and investment. The actual performance of the Commission to date has been a cause for concern in industry, so that the uncertainty about the system is as great as, if not greater than, before. I think therefore that the Bill is a real blow to industrial confidence, ! and it is so, even if its effects on prices are certain to be negligible, as I shall argue and as the noble Lord, Lord Jacques, acknowledged.
My real complaint, however, is that everything about this Bill is bogus. That is why it is a nasty piece of work and why it is distasteful even to have to debate it. In the past five years we have had many Bills—surely too many—which we have thought wrong in theory and damaging in practice, and we, and the Liberals, and the Cross Benchers, and sometimes even noble Lords who sit on the Back Benches
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opposite, have tried, sometimes with success, to limit the damage by amending them in Committee. But most such legislation was portrayed by the Government as having some relevance to their counter-inflationary strategy. This I take to be the desire to seek the consent and I co-operation of the TUC in a policy of progressive wage restraints: 10 per cent. one year, 5 per cent. the next, and so on.
The present Bill is bogus in that there is no pretence that the Price Commission can materially affect the rate of inflation. The Secretary of State for Prices and Consumer Protection agreed with his shadow, my honourable friend Mrs. Oppenheim—and the shadow displays an altogether more elegant figure than the substance—in another place on 20th November last that the effect of the Price Commission over last year was to restrain prices by less than half of one per cent. He himself said that the Commission was not an agency for getting prices down. He himself, on the same occasion, as reported at column 890 of the Official Report, acknowledged that removing the safeguards, or changing them, would
"involve some penalties in terms of industrial confidence".
I hope that we shall not hear too much of the argument—it was set out by the noble Lord, Lord Jacques—that the object of the Commission is to encourage competition and to discourage monopoly within industry. The fair trading and anti-monopoly legislation does that, and if the Government wish to strengthen such legislation or its executive arms, let them do so directly. We are ourselves interested in doing so, and we might (who knows?) even support them.
The flurry and fanfare with which the Bill is being introduced is also bogus. If there were a desparate need for the Government to abolish their own safeguards for protecting a firm's profitability during its period of being investigated by the Commission, why was Parliament not recalled to perform this urgent amputation during the first fortnight in January? I do not, I believe, usually trade in gossip, but I believe that, for once, repetition of gossip at the Dispatch Box may be justified. If you spend any time in the lobbies or talking with lobby correspondents, you will discover that the common view within the Labour

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Party is that this Bill is cosmetic, presentational and political. It is not about inflation; it is not even about prices. The Prime Minister himself has said that, where price rises are determined by wage-push, the costs must be passed on. He said it last Saturday: more than 10 per cent. (the officially allowed figure has doubled now, it seems) on the public sector manual workers' claims, and the burden must be taken by the ratepayers. The Prime Minister is quite right, of course. Only, if he believed in his 5 per cent. he should have stuck to it and insisted that costs over 5 per cent. be also passed on.
The Chancellor himself has said that wage increases averaging more than 5 per cent. (or has that figure now changed as well?) must be clawed back in higher prices caused by increased indirect taxes or by lower purchasing power caused by increased direct taxes—and for the ordinary person I think those two amount to the same thing. The Chancellor is quite right as well—if he sticks to it. Last, and surely least, the Secretary of State himself, the sponsor of the Bill, has made a nonsense of the provisions of his own Bill by freeing the road hauliers from price restraint. He is of course right to do so: costs in excess of a minimal level of ploughback profitability must be passed on to the consumer if the firm is not to go out of business; and if the consumer resists or finds an alternative, the firm may later go out of business in any case.
But, my Lords, what cynicism is being displayed here! Politics, surely, in the lowest, in the Tammany Hall sense of the word. The Government know very well, for instance, that, whatever the representations of Mr. Silkin, France and Germany are likely to win around a 2 per cent. increase in farm prices in the EEC Commission. That will put up food prices here. Can the Price Commission freeze these for three months—enough to get over the hump of a General Election, for instance? The motive can only be political, as the Government well know that they have no powers to reduce such price increases.
If the Bill is not about inflation and higher prices, what, then, is it about? It is about giving Labour Members of Parliament something to say in the constituencies. A Bill with "price" anywhere in it—and we on this side have
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been guilty of this in our time—is always cosmetic. Price rises are a symptom of inflation, not a cause. You do not cure a cold by amputating the nose. The Bill is designed to produce the effect of having the Opposition vote against it so that my honourable and right honourable friends can be presented as friends of the bosses, of profiteers, of "them" against "us" in the ancient, damaging and wholly bogus language of class and confrontation. It is this kind of thing, this kind of language and legislation, not seemingly so important in itself, which so terrifyingly dents the confidence of our friends and allies and, above all, of our creditors abroad Were it not for North Sea oil coming on stream and the troubles of the dollar, the pound would probably be now back at S1·60 as a result of the recent crisis—its level when the Callaghan Administration came in.
I have myself been listening to the word from the marginal constituencies. Labour Members and candidates have been saying that the recent troubles—the strikes, the breakdown in services and the crisis—have been due to the combined votes of the Opposition Parties against the Government's proposed sanctions against employers who granted wage rises in excess of 5 per cent. What schizophrenia!, since the accumulation of the unions' negative or disruptive powers over the economy—which has been persistent under all Parties since the war but which the present Government and Mr. Wilson's Government after the miners' election accelerated—makes it impossible for employers to resist inflationary wage claims where they want to and governmental incomes policies, responding to such inflationary wage-push, make it impossible for employers to grant claims for wage increases even when, as in the Ford case, they are able to do so and want to do so. This same schizophrenia is at work in this Bill. Let us combine, it seems to say, the maximum damage to business confidence, and therefore to investment programmes and jobs, with the minimum effect on price increases, which we all know, and which the Bill's sponsor has admitted, will be the consequence of the Bill's becoming an Act. What nonsense this is, and how distasteful !
I do not object to the electoral or the Party argy-bargy. It is inevitable; it is a consequence of democracy. It is perhaps even a safety valve. But I do

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object to its taking place, as it is at the moment, through the medium of legislation. That affects people who are not caught up in the Party argy-bargy but who have lives to get on with, jobs to keep and livings to earn. I do not know what my noble friends feel, or what the Liberal Benches feel, but I am tempted not to fall into the trap, and even to speed this scrap of paper, unamended, on its way to Royal Assent—though not, I hope, unshown-up. I really do not want to give Labour Members in another place the satisfaction of saying to their constituents that the House of Lords was holding up or tampering with a Bill to hold down prices. Not that I think that the constituents would be fooled. This is purely a Muppet Show of a Bill, with the Secretary of State King Canute as played by Miss Piggy. I am tempted to say, "Let him have his cosmetics, his eye-shadow and his false lashes, and much good may they do him".
The sad thing, though, is that we could do so much in Parliament at this time. There is a new spirit around in Britain at the moment. For the first time in years, I think, millions of people, whether Labour, Liberal or Conservative, or of no fixed political allegiance, whether unionised or not unionised, agree that this country's long slide from eminence towards irrelevance will accelerate unless something is done, and will be irrecoverable unless something is done. For the first time since the war there is general agreement that the something which has to be done concerns the labour unions—their freedom from legal restraints, their monopolistic tendencies, their inability to keep to the agreements they make, their economic isolationism and their failure to police their own ranks or to reform their own malpractices from within. If the Government would use this precious second of national consensus to give a lead and bring forward some reforms in this area, it could take industrial relations out of Party politics for the seven or eight years which we need for national recovery. It could restore the balance of power between management and labour, without which collective bargaining is either suicidally inflationary or suicidally destructive of jobs.
There is some evidence, even, that the Prime Minister would like to do this. If he would turn wishing into acting, then
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he might go down in history as a great Prime Minister—and (who knows?) might even win a General Election. But this present and disreputable little Bill puts paid to such fantasies. About the best thing to be said for it is that, far from proving a plank in the Government's platform, it is likely to be a nail in their coffin.
Lord BRUCE of DONINGTON: My Lords, before the noble Earl sits down—I was unable to catch his eye because he was paying such close attention to his papers—would he tell the House what evidence he has in support of his assertion that Mr. Silkin would give way to the pressure from Germany and France for a 2 per cent. increase in agricultural prices in the EEC; and will he state whether his own Party in the European Parliament will be prepared to vote for such an increase when it comes to the point?
The Earl of GOWRIE: My Lords, whether Mr. Silkin gives way or not, such price increases will be agreed between France and Germany, in my view, and will inevitably find their way back here in any case.
Lord BRUCE of DONINGTON: My Lords, will the noble Earl—
Several noble Lords: Order, order!
5.21 p.m.
Baroness SEEAR: My Lords, when the Price Commission Act 1977 was going through Parliament, we on these Benches gave it very full and complete support. This was because it was part of a combined strategy of policy to control both prices and pay. Our support for it was given because it was two-handed, because it was put forward while the Government were operating a seemingly successful policy to control pay. It is a very different matter to ask for support over prices at a time when control over pay has become completely out of hand and is no longer a reality in any shape or form. This is why we here who believe in control over prices and pay are asking—we have repeatedly asked and now ask again—not for tampering with prices with this petty little Bill for but the establishment of a proper Prices and Incomes Board; a Board which

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their predecessors set up and which the Tories in their unwisdom removed. This is the way to deal with the threat to prices; and not to put through at the present time a Bill which it is generally agreed cannot do more (as the noble Earl, Lord Gowrie, has said, as the Minister admitted, and as was admitted in another place) than affect 0·5 per cent. of the level of prices. Something far more thorough and effective to deal with prices is required than this little Bill which we are discussing here today.
When the Price Commission Bill was going through Parliament before it became an Act, we were aware that the safeguard clauses were a matter of great importance to industry—unaware as industry was of how the legislation was going to work, deeply anxious as it was about its ability to invest and about what could happen; and this is true still in many concerns—to their cash flow during the period while investigations are going on. Throughout all the negotiations which took place at that time, the emphasis of the employers on a requirement for safeguards was made very clear and was accepted by the Secretary of State. Of that, there can be no doubt. The assent of industry to this legislation was conditional upon the safeguards.
I can accept that the particular form of safeguards in the 1977 Act needs to be looked at again. For example, and perhaps in particular, the deadline date, the bench-mark date, of July 1977 becomes more and more meaningless as the months pass. It would not have been unreasonable of the Secretary of State to have gone back to industry and said: "While accepting the need for safeguards, the particular safeguards which are in this Act need to be reviewed"—and to have discussed again with industry what kind of safeguards would be appropriate to bring legislation up to date. This I could understand; but knowing, as the Government do, the importance attached to those safeguard clauses, surely it would have been better to try to revise the clauses rather than to abolish them.
The Minister says (and it was said in another place) that there is no need to have the safeguard clauses because the position for industry is safeguarded in two ways. It is safeguarded through Section 2 of the original Act—and the
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Minister read the main items in Section 2. Of course, there are general directions to the Commission as to what they have to take into account when estimating whether or not a price increase is going to be excessive, but in every case this requires the judgment (at the end of the day, inevitably, the subjective judgment) of the Commission as to whether what is being asked by the enterprise is reasonable or not. Nowhere in the legislation, except in the safeguard clauses, is there anything at all of a quantifiable nature. It is purely a matter of the judgment of the Commission. The safeguard clauses give a quantifiable safeguard—and it is in this regard that they are different from Section 2 and give a kind of reliability to the undertaking which none of Section 2 can do.
Again, the Minister said: You can trust the Commission to act reasonably; they are all honourable men. I am not saying they are not all honourable men—and it is to the credit of the Government that they are not even all men. The fact remains that it relies on their judgment. And individuals change. How are we to know who will be on the Commission in a few months' time? All sorts of alterations can take place. It is not good enough in any legislation of this kind, in which the viability of undertakings—and, as a result of that, the existence of jobs—depends on these judgments, that there should be nothing built into the legislation as a safeguard and that it should be left to subjective judgment. This is the objection to the removal of specific safeguard clauses with quantifiable limitations on what the Commission are able to do. It is asking too much to expect people to be so happy with the judgment of any Quango, however honourable and well qualified—as, indeed, I believe they are—the members of this particular Quango at the present time appear to be.
With the noble Earl, Lord Gowrie, I do not believe that this little Bill has really anything to do with price control. I believe it is a sop to the trade unions at this particular moment when the Prime Minister was looking for Danegeld to pay in order to try to win them back into the paths of sanity. This is not good grounds for bringing in a Bill at the present time, and I suspect that the Secretary of State knows this perfectly well. The Secretary

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of State is second to none in this country—and we know this and it is much to his credit—in his determination to try to hold down inflation. Nobody on either side of this House or of the other place has fought harder than he to try to hold down inflation. He cannot believe that this little Bill is going to do anything to hold down inflation.
In the longer run, what will hold down inflation is getting the employers and the unions and the Government together in a spirit of confidence to work out how these appalling problems that we face arc to be handled. If that is what you want, what an extraordinary moment to produce a Bill of this kind, to stick a knife into the employers at a time when they are having the most difficult period they have had since the three-day week—and perhaps it is even more difficult than then. At this moment many of them are not getting their raw materials; they are not able to meet delivery dates; they do not know what is going to happen to their pay bill. They are in a situation of great uncertainty, and if the Government really want to get both sides of industry together, then I say to them and to the Secretary of State—who I believe does want to see a successful solution—drop this shabby little Bill.
5.29 p.m.
Viscount TRENCHARD: My Lords, I have already, a fortnight ago, described this measure as madness in terms of the present crisis, and I do not want to repeat too much. However, 4 per cent. return on capital in inflation-proof terms is the all-industries statistic. One can argue it up to 5 per cent. If one takes oil out of it and looks at manufacturing industry only, currently it is certainly below 4 per cent. return on capital, return on investment, in real terms. What could be more inappropriate in an accumulated long-term crisis for British industry than to bring in an extra price control measure at this time? That 4 per cent. is half the current rate of inflation and, although we all regret it, that current rate is bound to rise. So industry is in a really disastrous position from a profitability and investment point of view. The cost of money is well above even the rate of inflation.
It has already been said by my noble friend and by the noble Baroness, Lady
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Seear, that this is—if I may paraphrase them—an appeasement move. It can only be an appeasement of the trade union position and one gets very depressed about this when one considers a point that has also been discussed in the House in the past week: that the vast bulk of the funds of the Party opposite is supplied by the trade unions, and 130 Members and many Ministers are sponsored by the trade unions. I wish somehow that the moderate element of the Party opposite could disregard this situation, but I cannot see that it can.
A nicer word than "appeasement" which has been used before now is that this is a quid pro quo. If this phrase had only been heard once in a temporary measure lasting a year or two, it might have been all right; but, along with other industrialists, my classical education was not very good, and after 12 years industry is wondering whether the literal meaning of "quid for what?" is not a nearer description. What has happened over these 12 years of price control, dividend control and other things which have made it worthwhile? Almost nothing, my Lords. I personally do not agree with the line taken by the Liberal Party on the need for a permanent statutory incomes policy. I believe such policies can only be applicable on a short-term basis, and we have had this one, as I have said, for too long. The real answers lie—and the Government must know that they lie—in the kind of reforms to balance the bargaining position of which my noble friend Lord Gowrie has spoken.
My Lords, what about the effect of price control? The old style Commission claimed that at the peak, between April 1973 and May 1977, it had had a 3 to 4 per cent. effect on prices. My own feeling, with apologies to my noble friend Lord Cockfield (who is to speak in this debate), is that the effect is not really calculable, because one only knows, on the one hand, the notification for price increases and the actual price changes that take place. One never knows what the position would have been without price control and with the competition and market forces at work. A point which is often badly overlooked is the immense effect of 1 per cent. on the sales value or the retail price index. For British manufacturing industry as a whole, 1 per cent. on the retail price index is the equivalent

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of 16 per cent. of profit. For many firms it is much higher than that: 20 per cent or a quarter. Thus delays—a matter to which I shall return in a moment—can easily knock a big chunk off the profitability and the ability to invest of important companies.
We need profitable companies. If we turn to the case for individual or selective control, we find we need such companies because they are usually the ones which are growing and investing, whether they are in such a position by their skill or by good fortune. And, my goodness, we need jobs! A lot has been said about price leadership and market dominance. I was for four years president of an organisaton called the Institute of Grocery Distribution, which was primarily concerned in research across the whole field of food, food manufacturing, food retailing and the things that go with it in most of the modern stores today. We could find no evidence that price leadership or market dominance where one firm was large weakened the force of competition.
I came very much to the conclusion that there is a great muddle in the minds of some economists and some academics today on the subject of perfect competition, or, as the noble Lord, Lord Jacques, said, imperfect competition. Most of the text books paint a picture of rows of barrow boys selling apples with prices moving a farthing every hour or two in the old-fashioned street markets. The fact that that could have been called cutthroat competition, with no resources for investment and no resources for development, does not ever seem to occur to the writers of these books. The fact that in modern economies the nature of the competition has changed to longer term, often to world wide competition; that it builds in to a much greater extent factors other than price, such as quality, convenience and service, and that the modern, busy housewife is not looking for changing prices by the hour (indeed, they would only confuse her to a very high degree)—these changes in the nature of competition in a modern economy do not mean that competition is any less fierce.
In my past experience I have been both a "big boy" in a market place, and a "small boy" in a market place. I have been in concentrated industries with few firms and in fragmented industries.
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I have not been in a State monopoly; I agree that in terms of State monopolies the Monopolies Commission would seem to be the right agency to deal with the question of pricing where there is a need.
Since it is in the "big boy" areas that many neutral-minded people have criticism of the market place, let me take the case which the right honourable gentleman, in the debate on this subject in the other place, mentioned many times. First, let me declare a past interest. I am no longer a director of Unilever, but I was a director for 10 years. As those who have read Hansard know, the Lever Brothers company has been quoted by the right honourable gentleman on several occasions. Let me start by saying that I get just as irritated as anybody else with the soap advertisements that I see on the television, though I find from market research that, curiously enough, the mass market does not seem to get so irritated. Competition in that highly developed industry consists of some very big international firms: American and German; and Lever Brothers is the English firm. It is an industry where there are a few big advances in technology every now and then, and a great number of small advances which do not get noticed but which, if one looks back over the years, have changed to a major degree the quality and service that the products perform for the housewife.
However, in all my years in that company—and they ended at the beginning of 1977—we knew that if we were to stay in the battle with large American and even German companies, we had to earn in that industry some 8 to 10 per cent. on sales; otherwise one could not make the necessary amount of reinvestment in new methods, do the research and development or have the ability to launch new products in order to keep up with this very strong competition. If you are interested, your Lordships will find on page 31 of the Price Commission's investigation into this company, which was so much quoted by the right honourable gentleman, that between the years 1973 and 1977 the profit as a percentage of sales was reduced from 9·9 to 4·4. What could be the excuse—and he gave this company as an example—to hold up the price application of that company? I feel that many industrial leaders, apart

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from much neutral opinion, have not really studied the mass market and do not have real experience of it. Competition has changed but it is as fierce as it ever was.
The noble Lord, Lord Jacques, has said that we have nothing to fear. The Government spokesmen in the other place have said much the same and that the opportunity to investigate before a price move takes place is the objective of the Bill before us. My noble friend Lord Gowrie has pointed out that both kinds of safeguards—the permanent as well as the temporary—are removed. Let us just take the temporary. First, there has to be 28 days' notification of a price increase, and then the investigations can last three months. It took all 630 staff, supported by many outside firms of accountants and consultants, to do 20 individual price investigations in, I think, 1978: I am not absolutely certain of the exact period. How, then, are they to discharge their work and how are they, if I heard the noble Lord correctly, to follow the purpose of the original legislation as he described it, and investigate each price application?
Lord JACQUES: My Lords, may I interrupt the noble Viscount? The Commission does not investigate each price increase application. The whole basis of the legislation is that it is selective. The Commission have full discretion to decide which they are going to investigate and, in point of fact, up to date they have completed investigations in only 31 cases.
Viscount TRENCHARD: My Lords, I thank the noble Lord for that intervention. I will read Hansard, and I trust he will also, because I think that at one stage he said the purpose had been to investigate each case. But obviously that is not possible and obviously they must be selective. As the noble Baroness, Lady Seear, said, it is a matter of judgment in selection and in how each new team, coming to each new company in different industries, interprets the situation. I cannot help feeling that there is a pretty high degree of arrogance in the assumption that perfect judgments, or even good judgments in the main, can be reached on highly complicated issues like this in the time available.
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We are talking of a four-month delay in any event, and anyone with marketing experience knows jolly well that while price increases in some areas are frequent and in other areas only occasional, there comes a moment when there is a market opportunity, when the right thing to do is to move it, when you can indeed get your profitability nearer to a level at which investments can be found. And you can miss that market opportunity completely with this four months' delay and be unable to tackle it again for another year, during which time, if your return is as the average is at the present moment, or even if it is above average, your cash flow is going to look pretty silly.
The noble Lord, Lord Jacques, has said that the Government regret that this Amendment Bill will last for only a year; but it is a pretty "key" year, with inflationary pressures as they exist and with industry in many cases really on the rocks. The level of bankruptcies is already too high and the level of investments, as we all know, has been much too low. The effect of the dislocation and strikes that have taken place, also mentioned by the noble Baroness, means that there will be more bankruptcies; and now we have a power to delay at least for four months, which can be quite critical, price applications from companies making virtually no profit at all.
I wish I could fully agree with my noble friend that the effect of this measure will be really only cosmetic and therefore the best thing to do is to let the miserable scrap of paper go through, even though it has no relevance. I believe it is more than possible that it can do real harm, that it can add to the total of jobless and that it will do so unless some floor level—whether the old floors under the regulations in the Bill were correct or not is a matter for debate—is established in terms of profitability, to the position wherein a company can increase prices without waiting for a long investigation to take place. I would suggest that floor level should be put at the current rate of inflation, or perhaps at the rate of inflation and move with it; because if a return on capital on a current cost-accounting basis is below 8 per cent. at the moment, that company is already in a very bad way and there is a real risk that a four months' delay, in a year when

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inflationary pressures are building up, could just make the difference.
Will the Commission, with the number of members it has and with the workload it has, be able to use its discretion correctly to let the price go up anyway in cases which are deemed to be really serious? I personally doubt it, and at this stage I should like to hear what the noble Lord has to say about it. I should have liked to give Notice of an Amendment to be raised at Committee stage to bring in a floor at this ridiculously low level, which would at least avoid the risk of causing more unemployment. I have been told that there is a possibility, owing to the rushed timetable and other technicalities which someone so amateur in the political world as I am does not really understand, that any Amendment passed by this House which would send the Bill back would mean that the Bill could not proceed. I do not know whether the noble Lord can explain this matter, perhaps in his winding-up speech today.
5.48 p.m.
Lord COCKFIELD: My Lords, I have been reluctant to address your Lordships before on the question of price control because I have always taken the view, in this and in other fields, that if one has had the responsibility for implementing a policy and then relinquishes that responsibility, one ought to leave one's successors to get on with the job without either fear or expectation of help or criticism from oneself. However, the present Bill does raise a point of constitutional importance, and Í adopt the phrase that was used by the noble and learned Lord, Lord Denning, in his judgment in the case of GEC v the Price Commission—a judgment, if I may say so, which is itself of great constitutional importance. That being so, I feel I must talk to your Lordships about this specific aspect of the matter. I wish to make it clear that I am not attempting at this stage to argue whether or not there ought to be a price control. The Bill in front of us deals with a very narrow issue: namely, the amendment of one particular section of the 1977 Act, and that is the matter to which I will address my remarks.
The control established by the 1973 Act has been the subject of a great deal of
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criticism; indeed, I myself criticised it both during its currency and since Í left the Price Commission. But it did have one great merit, which was that the rights and obligations, both of the Price Commission and of the company which was the subject of the control, were clearly and specifically laid down. The effect of this was that if there was a disagreement between the Commission and the company as to what were their rights and obligations they could always have access to the courts, and indeed on a number of occasions cases were taken to the courts; one of them went as far as the House of Lords. Cases were similarly taken involving the old Pay Board. These judgments were of great assistance both to the companies concerned and to the Commission in interpreting their rights as well as their obligations.
The 1977 Act, however, marked a sharp break with that tradition. It was drafted in a way which made it almost impossible for an aggrieved company to have access to the courts. There are a large number of criteria laid down in Section 2 of the Act, but they are all expressed in the most general terms and—what is perhaps more important than that—the Act itself specifically provides that these considerations are to be taken into account only "so far as the Commission consider them relevant". Attempts to oust the jurisdiction of the courts are not always successful; nevertheless, it is difficult to escape the view that any attempt to go to the courts under this Act would be extremely difficult.
One will no doubt remember that, at the time when this Act was passed, the Government had suffered a series of reverses at the hands of the courts. There was the Jenkins case involving the TV licences, there was the Tameside case and there was the Laker case, and this Act was drafted to ensure that there would not be any more of them so far as this legislation was concerned. But there is another point that I wish to make. Not only, on the face of it, was the legislation written in the hope—I do not say the certainty; I shall be quite clear about that—of excluding the jurisdiction of the courts, but something else was done. The Prices Act 1974, which was an Act passed by a Labour Government, so its parentage is, presumably, beyond reproach, provided that in the case of an order to prevent or

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restrict price increases the power could be exercisable only by Statutory Instrument, which of course was not only debatable in the House if the House so wished, but a vote could be taken on it. The 1977 Act provided, in general, for no such oversight or supervision by Parliament. Therefore, the position we have is that not only has the jurisdiction of the courts been largely excluded, but so has the supervision of Parliament as well.
There was, however, one single bulwark erected to protect a company, and that was the safeguard contained in Section 9 of the Act. This said that however much you held down a company, whatever you did, you could not go beyond a figure to be specified in regulations made by the Secretary of State and in due course approved by Parliament. It would have been a perfectly understandable course of action if the Government had said, "We have now come to the conclusion that the figures contained in those regulations are no longer appropriate, and we want to come along and amend them", which would have meant that we should have had a new set of figures which we could have debated and, if necessary, voted upon. But the Government have not done that. They have said instead, "We wish to sweep away altogether this one final protection which appeared in the 1977 Act."
The result is that the powers which are now possessed by the Price Commission are not only extremely wide, but, in the technical sense of the term, not subject to any constraint or any real control. I know it is argued, and probably correctly argued, that the Price Commission act reasonably and responsibly. It is argued that the Price Commission consists of people who are experienced and knowledgeable, and that their judgment can be relied upon. But from the point of view of the argument that I am putting forward, that is totally irrelevant. You cannot defend despotism on the ground that it is a benevolent despotism. You cannot defend dictatorship on the ground that it is an efficient dictatorship.
May I give your Lordships an example? What would be the reaction, not only in this House but in the country, if we did this kind of thing in the taxing Statutes? Let us suppose that we had a Finance Bill
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which said that the rate of income tax shall be fixed by the Chancellor of the Exchequer after taking into account any of the following list of matters, to none of which he may pay any attention unless he thinks it is relevant. That is not a fanciful example. Your Lordships will be familiar with the case of Rex v.Hampden and the very grave consequences which flowed from that case.
It will, I know, be said that this is a very small Bill, that it is not the kind of thing which represents so major a breach in our traditions or practices that it really supports the kind of argument about the constitutional position, or the worries about the constitutional position, which I have put to your Lordships. But let us always remember that the erosion of our liberties comes not in one sudden cataclysm; it comes in the thousand-and-one small things which erode our liberties. The reduction in the sovereignty of Parliament comes not in one great measure, but in the thousand-and-one little ways which reduce its sovereignty. The reduction in the rule of law comes not in one great step; it comes by erosion over time in a thousand-and-one ways.
May I remind your Lordships of the words which were uttered nearly 200 years ago by Judge John Curran, in times which were just as turbulent and troublesome as they are at present. What he said was this:
"The condition upon which God hath given liberty to man is eternal vigilance, which condition, if he break, servitude is at once a consequence of his crime and the punishment of his guilt".
I commend those words to your Lordships.
5.59 p.m.
Lord MOTTISTONE: My Lords, it is indeed a privilege to follow my noble friend Lord Cockfield, whose views are always to be treated with respect, but on this occasion he has surpassed even himself in the skill with which he put his case. It is a real pleasure once again to find a Government Bill being introduced by the noble Lord, Lord Jacques. I have happy memories of that well-known partnership, Oram and Jacques, which used to keep us fully occupied into the middle of the night some 2½ years ago. But this is not such a happy occasion.

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Apart from giving us memories which are happy, the noble Lord, Lord Jacques, is one of the very few members of the Government who has practical experience of the business world. I think that the Government are extremely lucky to have him to put their case. I therefore listened with particular care to his argument justifying the Bill, and I found it quite impossible to be convinced by his proposition that there is any real need for the Bill on the one hand and any real desire for it by the Price Commission on the other.
It is said that the Price Commissi honave felt frustrated that their decisions have had to be underpinned by the safeguards which are currently available under the Price Commission Act. However, it does not seem to me that when they have finally completed their investigations they have been in any way seriously incommoded by the fact that in some cases but not all, the firms concerned have invoked the safeguard clauses and enabled themselves to put up their prices in advance. It seems to me that the difference, if any, that there would have been if there had been no safeguard clauses would have been minimal.
With that in mind, I should like to turn to two points which were made by the noble Lord, Lord Jacques. The first is that the guidelines are general and liberal; therefore we can rely very well on Section 2 of the Act and be wholly confident that, applied by a wise and sensible, albeit perhaps dictatorial Price Commission, effectively the safeguards will be taken care of through that process. That is absolutely so, provided, of course, that the guidelines are applied in the way that we, as the recipients, might like them to be applied. But we cannot be sure of that.
It has been said that the Price Commission have been in existence for 18 months and that they have a great deal of experience. This may be so but, as the noble Baroness, Lady Seear, said, one cannot be sure that the Price Commission will stay exactly the same, even for a year—the present time limit of this amendment to the Act. So I question whether it is safe enough—and it was here that my noble friend Lord Cockfield made his point so very forcefully—to rely upon broad-brush guidance which can be interpreted by one person in one way and by another person in another. As again
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has been said by my noble friend Lord Trenchard, I suspect that this is a singularly awkward and unfortunate moment to take off the further guidance that the safeguard clauses gave. This is a moment in time when the effects of the recent disturbances on raw material supplies and, hence, on raw material prices are quite beyond the wit of man to be sure about and when we find that the other great variable in the cost to companies—labour cost—is itself going wild in proportion to what the Government required, as from last August. Consequently, from the point of view of companies, this is a particularly unfortunate moment to remove the very reasonable extra guidelines which the safeguard clauses provided.
Turning to the Price Commission themselves, I wonder whether it is fair on the officials of the Price Commission who will have to conduct the investigations, make judgments and advise the Commission on what those judgments might be. When there were safeguards, at least they had some kind of guidelines of a positive nature. Those guidelines enabled them to make the right kind of recommendations to the Commission. Now, however, they will be, as it were, naked in the advising chamber; they will have nothing to rely upon except the very broad-brush requirements of Section 2 of the Act. I suggest that it is unfair not only on companies but also on the officials of the Price Commission.
This leads me to question yet again why it should be necessary to have the Bill. I am not going to suggest that we should go further than my noble friend Lord Gowrie advised and try to reject the Bill, but it seems to me, for practical reasons, to be totally unjustified. As has been said by many noble Lords, the Bill is not going to convince any of the trade union leaders or, more especially, the trade union members whom some people have suggested it is designed to placate. Therefore, I cannot see why the Government feel that it is so necessary to have this particularly measly little Bill and force it through Parliament so terribly fast, as though the results of it were going to be the complete answer to all the country's problems. It just does not make sense.
When he comes to reply, I hope that the noble Lord, Lord Jacques, will be able to give us a real reason. If anyone can give

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us a real reason, if there is one, the noble Lord, Lord Jacques, can. If he cannot, I shall suspect that the Government have lost control—as we learn almost daily from the newspapers that they have—over their art of trying to run this country.
6.8 p.m.
Lord BOYD-CARPENTER: My Lords, I must begin by declaring something of an interest. A company of which I happen to be chairman, the Rugby Portland Cement Company, is at the moment under investigation by the Price Commission, although I am glad to say that the notification in respect of which the investigation is being made was submitted comfortably before 17th January. I declare this interest because noble Lords may feel, understandably, that that interest may bias the views which I seek to express to your Lordships. On the other hand, there is the compensating advantage of immediate and practical experience of what this means.
I am bound to say in that context that I thought the noble Lord, Lord Jacques, shrugged off rather lightheartedly the effect on any company of the mere mechanics of such an investigation. Substantial numbers of young accountants, hired from an outside firm of accountants, descend upon your company. They monopolise a great deal of the time of senior management which otherwise would be devoted to furthering the interests and developing the profitability of the company. They demonstrate an insatiable appetite for statistics, coupled with no very conspicuous indication of knowledge of the problems of this or, indeed, of any industry. Although these are things, like our climate, which fortitude enables one to endure, it is a little bit of a mistake to suggest, as did the noble Lord, that this is rather a nice thing to happen to one.
Having said that, may I say how much sympathy I have been feeling during the last hour and a half for the noble Lord. As he knows, noble Lords in all parts of the House have a great affection for him. Therefore, it must be very disagreeable for the noble Lord to have to sit there, without a word raised in his support, listening to noble Lords who speak not mainly with that ordinary spirit of Party bias and controversy, which is a very healthy thing in itself, but almost without exception with
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direct authority and experience of the subject-matter of his Bill.
I was a Minister for a good many years and I know how lonely one feels when a legislative Chamber is almost unanimously—or, in this case so far, is unanimously—critical of one's measure. When that criticism comes, it comes from people like the noble Viscount, Lord Trenchard, the noble Lord, Lord Cockfield, with his unique experience in this area and others. It must be very uncomfortable for the noble Lord because, being a man of sensitivity and sense, he must have a sneaking feeling in his mind now that they are right and that his masters, who put this Bill into his hands, are wrong.
It is indeed a very curious time at which to bring forward this Bill, as has been pointed out. But, in defence of the noble Lord, I must say that his unhappy situation stirs my remaining flickers of chivalry. It is at least a Bill consistent with this policy of the Government of which he is a member. It is brought forward, as last summer was the Bill to restrict dividends, with no real belief that it will do any good, with no real belief that its consequences will be other than harmful to the economy, but because of the pathetic belief of Ministers that the loyalty and co-operation of the trade union leadership can be obtained by steps which, by imposing misery on the employers, reconcile the trade union leaders to the misery which the Government are inflicting on them. As I have said before in this House, I think that that underrates the wisdom and judgment of the trade union leadership, to think that they are really going to be affected or induced to co-operate by considerations of this sort.
Surely, as thinking men, their concern must be with the continued employment of their membership; surely they must be concerned with whether the companies for which they work will be profitable enough, not only to continue to employ them but to employ more of their members and to be profitable enough to offer a tempting target when the next wage demand comes along. They cannot really believe, any more than I think any noble Lord in this House believes, that a step of this sort taken at this moment will make any contribution whatever to the effective operation of the British economy.

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It has been said before, and I will not weary the House by reiterating it, that it must discourage investment in British industry. Any noble Lord—and there are many here—with experience of investment decisions knows that this is made on a judgment as to the likely profitability of the particular investment: if you install new equipment or if you open a new plant, is it going to be profitable and make a profitable return? But if you induce into the calculation of the viability of an investment (difficult enough as it is) this further consideration that you may be subject to an outside interference by a strengthened Price Commission concerning the price which you calculate should be paid on the product of that investment, are you not simply going to mark that file "Bring forward six months hence" or "Bring forward a year hence"? Are you not going to add to the already excessively low level of investment in British industry and therefore continue to perpetuate the disheartening size of the unemployment total? That surely must be the practical and the consequential effect.
Of course, by taking away the safeguards, which the Bill seeks to do, it is argued that one only defers the price increase for three or four months and that the Commission, in its discretion, may not even grant that deferment. But, as has been said already, those three or four months may be crucial to the year's results of any company. Moreover, there is no certainty whatsoever that the Commission, freed, as it may regard itself, of the incubus of the safeguard provisions, even after three or four months will allow at least the price increase which a proper calculation of the safeguard provisions would cause them to apply. Several times the noble Lord said that it was left to the discretion of the Commission and these are wise, amiable, well disposed, public-spirited citizens. It may so be, but it is not the general policy in this country to rely solely on the amiable character of public functionaries and for that reason to exclude them from any check or control. As I understand it, the Commission, in deciding whether to allow an interim increase in prices during its investigation, acts wholly in its discretion. As I understand it, no Minister is responsible for what it does or does not do in that respect. It is insulated by the legislation from Parliamentary control.
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That is not good enough. Ministers of the Crown are—or so the noble Lord will say—high-minded, public-spirited men of the highest character, and no doubt many of them are, but at their most arrogant they have never argued that for that reason they should not be subject to parliamentary control and questioning. Yet it is that kind of insulation from any measure of public control which this Bill proposes to confer on the Commission during at any rate the three or four months to which otherwise the safeguard provisions would have applied.
What is the significance of those three or four months? A glance at the calendar makes it only too painfully obvious that this is to give the impression, it is not?—and the noble Lord would say so if he was being frank with the House—to the electorate during the next few months, in the period leading up to the election, that price increases are being held. The fact that this is a purely temporary dam over which the waters will surge at the end of the four months will be as easily forgotten as was the real rate of inflation forgotten by Mr. Denis Healey during the election of October 1974 when he told the astonished electors that the rate of inflation was down to 8·5 per cent. That is the explanation of it, and if the noble Lord would only say that I think we would understand that there was a reason, however blatantly political, for this measure.
I want to follow up one aspect of this matter. I have told the House that my own company was subject to one of these examinations and for that reason I naturally regard it as being appropriate and proper to defer, until that operation is concluded, any observations I may desire to offer to this House on the working of the Price Commission. However, I do want to invite the attention of the House to the spirit in this respect in which the Minister in charge of this Bill in another place is bringing it forward. Mr. Hattersley, Secretary of State for Prices and Consumer Protection, in the course of the Second Reading in another place—and if noble Lords wish to look at the reference, it is column 1067 of the House of Commons Hansard of 29th January—was interrupted by one of his honourable friends who suggested to him that there existed cases of underhand price rigging.

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Mr. Hattersley immediately responded, favourably to his honourable friend, by saying that that led him on to a particular case, and he proceeded to refer to the applications made a little time ago by what he described as "Associated Portland Cement"—but which in fact is now called Blue Circle, although Mr. Hattersley does not appear to know that—and by my own company, and he went on to appear to accept the insinuation that the applications put forward by these and other companies in the industry were connected with underhand price rigging.
That extraordinary ministerial observation is made the more extraordinary when I point out two things. First of all, as the Secretary of State apparently did not have time to mention, the common price agreement in the cement industry under which these applications were made has twice been before the Restrictive Practices Court and on both occasions was blessed by that court as being appropriate and in the public interest. I think that if a Minister in charge of this Bill in another place thought fit to cast aspersions in this connection on my own company and on Blue Circle, common fairness surely would have impelled him to point out that, whatever he might think about the arrangement, it had been subjected to impartial review by the body set up by Parliament to undertake that review, and on two occasions. Of course, it may be that Mr. Hattersley did not even know this; nothing in connection with his grasp of affairs would surprise me. But, if he did, I think the House will feel that he behaved extremely badly.
The second point which I think is of some significance is this. When the Price Commission has concluded its investigation it will report to him, if he is still in office, and observations of this sort made in the House of Commons at the moment when the investigation is beginning do not suggest that any report that the Price Commission may send to Mr. Hattersley will be viewed with the objective realism which any citizen is entitled to expect of a Minister of the Crown exercising functions conferred on him by Parliament. I think this particular episode, which I thought it right to mention to your Lordships, indicates, perhaps somewhat unpleasantly, the spirit
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in which in certain circles—and I acquit the noble Lord, Lord Jacques, entirely—these proposals are being brought forward.
There is one other comment I would make, if I may, and it is this. I find the Government's new found enthusiasm for competition rather agreeable. It has all the vigorous freshness of Saint Paul arriving at Damascus. But I wonder if they are going to carry it into the public sector. Are they going to waive the Post Office monopoly and give that enormously overgrown organisation a little healthy competition? Are they going to allow competition in coal, steel, shipbuilding or water? How far does this conversion to the principle of competition go? Or is competition only for the private sector, while, of course, the Government's darlings in the public sector must be sheltered from that cold breeze?
I come back to the central point: the effect on investment, on the morale of industry, on that industrial confidence on which the industrial expansion and the recovery we all want to see in this country depends, will be, and must be, adverse. The fact that the Government have made it clear once again that they will seek to support their policies by knocking employers, by leaving the unions at liberty to do what they want but knocking the employers on the head, must be a discouragement. The prospect for employers of being crushed between the nether millstones of the Price Commission and the trade union movement is not one which is going to encourage investment or enterprise in this country. If I ever knew of an encouragement to invest anywhere but in this country, it is surely a measure of this sort. And worst than this, morally, though not perhaps in its long-term effect, this Bill is designed to cash in on the worries and anxieties of the housewife and the pensioner, who are desperately frightened of inflation, desperately scared of rising prices, and it seeks to prostitute their faith by a measure which the Government know cannot bring about the effects that are being suggested.
6.26 p.m.
Lord JACQUES: My Lords, first of all I want to thank the House for the goodwill which has been expressed, and I will try to be worthy of it. I thought

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that the noble Earl, Lord Gowrie, spoke about anything except the Bill. I do not think the Bill has got any relevance whatever to the present crisis, none at all. I think that anybody on my side who pretended it had would be blind.
Lord BOYD-CARPENTER: My Lords, will the noble Lord allow me to intervene on that point? Can he explain why it was that the intention to introduce this Bill was announced by the Prime Minister in his Statement on the crisis in the House of Commons on 16th January?
Lord JACQUES: Well, my Lords, I know it was announced by the Prime Minister on 16th January, and it was done when he was making a Statement on the crisis. I still do not accept that it had anything to do with the crisis; quite frankly, it has nothing to do with the crisis at all. This Bill and the 1977 Act are part of the monopoly legislation, and all the evidence supports me on this. First of all, it is selective, it is not rigid across the board. Secondly, only the large firms have to submit their price increases, the people who are semi-monopolistic or could be semi-monopolistic.
Baroness SEEAR: My Lords, surely the noble Lord the Minister is not expecting us to believe that because you are large you are necessarily monopolistic?
Lord JACQUES: My Lords, I am not suggesting that because you are large you are necessarily monopolistic. What I am suggesting is that it is part of the monopolies legislation; monopolies are large, and therefore, because of that, only the large firms have to give notice. The noble Baroness is coming to conclusions which do not arise out of what I said.
Viscount TRENCHARD: My Lords—
Lord JACQUES: No, my Lords. When I am finished I will be prepared to answer the noble Viscount's question if I can, and if I cannot I will write to him.
Lord HAILSHAM of SAINT MARY-LEBONE: My Lords, if the noble Lord cannot answer he will not answer.
Lord JACQUES: Furthermore, if anyone looks at the cases which have been investigated by the Commission he will see that many of the firms involved are very large; there could be good grounds for a suspicion of imperfect competition or monopoly. I suggest that all the evidence is there to show that the Bill is part of the monopoly legislation and has nothing whatever to do with the crisis. I certainly would not like to have to use it as if it had something to do with the crisis.
The noble Baroness, Lady Seear, said that we should have a prices and incomes board. I was glad she admitted that we did have it under the 1964 to 1970 Labour Government, and that it was the Opposition when in office who abandoned it. She would like to see it back. I think there is a good deal to be said for what she has in mind. I take the view that so long as there are institutions, whether they be trade union or industrial organisations, who have power to extract monopoly value from the consumer we need institutions to safeguard the community. If it has to be a prices and incomes board, so be it. But I do not think that at the stage we have reached in this Parliament that kind of legislation could be contemplated. As was done in 1964, that is something to be done at the beginning of a Parliament.
The noble Viscount, Lord Trenchard, said that he had found that market leadership did not necessarily mean imperfect competition. That experience is different form mine, and I have been in distribution all my life. I found that the market leaders could afford the advertising necessary to gain the support of the public—to get the name across and to get the goodwill. However, their small competitors could not afford it. Consequently, the small competitors could not compete in advertising. The only way in which they could compete was to try to sell their commodities at a price lower than the advertised price of the market leaders. I know something about that because I was associated with the Co-operative Wholesale Society which had small-scale outputs as regards hundreds of items in competition with market leaders. Indeed, that is still so.
Viscount TRENCHARD: My Lords, does not that mean that the noble Lord did very well as a small man?
Lord JACQUES: My Lords, we did very well, but perhaps that was for the reason that ours was a co-operative organisation, and not for the reasons which the noble Viscount has in mind.
Lord BOYD-CARPENTER: My Lords, he did all right all the same!
Lord JACQUES: My Lords, I wish that your Lordships would let me finish my argument and not butt in. As I was saying, I found that the small man had only one way of competing with the market leader and that was by asking a lower price. It follows that immediately the market leader increases his price all the little people can follow suit whether it is justified or not. That is what I mean by imperfect competition and I challenge anyone to say that that is not the position in practice.
Viscount TRENCHARD: My Lords, may I?
Lord JACQUES: My Lords, in view of the words which I have used, yes.
Viscount TRENCHARD: My Lords, as regards price leadership, if the market leader puts his price up by too much—I have been a market leader and a small man—the small man, on quality as well as on price, will very often nibble his market share and the big man's price will come back. The history of the market place is littered with exactly that type of example.
Lord JACQUES: My Lords, it is so long since we had price reductions that I had forgotten that that ever happened. The noble Viscount, Lord Trenchard, also raised the question of interim increases where there is an investigation pending. As I said in my opening speech, the Commission not only has a discretion in making interim increases but it has shown in its reports that it is sensitive to this practice. For, in several cases, in addition to the automatic increases, it has awarded interim increases and if the automatic increases had not been available there would no doubt have been many more cases where it would have used its discretion.
The noble Lord, Lord Cockfield, raised a legal point which is rather out of my province. However, I am advised that the
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Commission must have regard to the criteria in the section; that a discretion given to it must be exercised reasonably and that if the Commission does not do so the courts will intervene. Therefore, I would submit that, in spite of the wording of Section 2, it would be possible to challenge in the courts the way in which the Commission used the discretion.
Lord COCKFIELD: My Lords, I am sorry to interrupt the noble Lord, but I should like once again to read to him the actual words of the Section. Section 2(1)(a) says:
"to have regard to all matters which appear to the Commission … to be relevant",
and in Section 2(1)(b), it says:
"to have regard … to the matters mentioned … so far as the Commission consider them relevant".
Is the noble Lord suggesting that those words have no effect at all?
Lord JACQUES: My Lords, I am merely suggesting that the Commission must use its discretion reasonably and that if, in the opinion of the court, it had failed to do so, then the court would act not by submitting something different, but by causing the Commission to have another look to see if it could not use its discretion more reasonably.
The noble Lord, Lord Mottistone, raised the question of the automatic safeguards and the reason they should not be abandoned. The Government's view is that we have gone a long way to get rid of rigidity. The inflexible code of the Board has gone. Only one piece of rigidity is left—namely, the automatic safeguards. The Government are of the view that all rigidity should go and not just part of it. Therefore, they have come forward with this Bill.
Lord MOTTISTONE: My Lords, by the same argument, would the noble Lord think it more appropriate for ladies to bathe with no clothes on at all rather than just a bikini?
Lord JACQUES: My Lords, whether I would or would not, my judgment on that particular question has little relevance to the Government's view. If I were Mr "A" I would take one view and if I were Mr. "B" I would take another view. Therefore, I cannot see the relevance of that question.

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The noble Lord, Lord Boyd-Carpenter, accused me of shrugging off the frustration and inconvenience of an investigation. I was not aware that I had done so. I am confident that I did not do so. However, if I did, I would sincerely apologise because I have suffered the inconvenience of that type of investigation and it can be frustrating and costly.
I think that I have covered the principal points raised. I have a note on the question of Royal Assent which might be of interest to the House. This matter was raised by the noble Viscount, Lord Trenchard. Under the existing law, the Price Commission must consider notification of price increases within 28 days. If it does not do so, the applicants may raise their prices. The 28 days expire on Tuesday next, 13th February. According to Press reports certain price increases, including beer and petrol, were notified just after the announcement of my right honourable friend the Prime Minister. The Price Commission meet on Wednesdays and thus would consider these price increases on Wednesday next, 7th February. For that reason we have been seeking to obtain Royal Assent by Thursday of this week to avoid uncertainty. That is much the best outcome. But, it would also be possible—and contingency arrangements have been made against delay in obtaining Royal Assent—for the Price Commission to consider these increases up to Tuesday, 13th February. That, I think, answers the point raised by the noble Viscount, Lord Trenchard.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

ARBITRATION BILL [H.L.]
6.39 p.m.
Report of Amendments received.
Clause 1 [Judicial review of arbitration awards]:
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendment No. 1:
Page 2, line 11, after ("applicant") insert ("paying into court the amount of the award and").
The noble Lord said: My Lords, I beg to move Amendment No. 1 and, with
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the leave of the House, I shall speak to Amendment No. 2. The effect of this short Amendment is to strengthen the position of the High Court in respect of attaching conditions to granting leave to appeal. The object is to avoid frivolous appeals and, rather than leaving the payment of a sum awarded by an arbitrator as discretionary to the court, the proposed Amendment will make the payment mandatory.
It seems to a number of practitioners that the inclusion of this type of clause in the Bill will have a helpful effect in reducing the number of non-meritorious applications for leave to appeal in an award. No doubt the noble and learned Lord on the Woolsack will point out that, of course, the court has power to make such a condition for leave to appeal. But this is an area dealing with commercial matters and to include such an Amendment as I am moving would have, in practice, a useful effect. I beg to move.
The LORD CHANCELLOR (Lord Elwyn-Jones): My Lords, in my submission, these Amendments are unnecessary and I rather apprehend that the noble Lord suspected that that might be my answer. As drafted, the Bill would enable a court to make any leave which it gives conditional upon the applicant paying into court the amount of the award. The High Court should be free to impose such conditions as it may think appropriate. A typical condition would be a requirement that the minimum sum due to the successful party should be paid over to him or that the sum in dispute should be secured.
If the noble Lord will permit me to say so, the difficulty is that an Amendment of this nature might cast doubt on other enactments which give power to the court to impose conditions. I hope that in the light of what I have said the noble Lord will not desire to press this Amendment.
Lord DIPLOCK: My Lords, there is also one other difficulty as regards this Amendment. As often as not the applicant to the court is the plaintiff in the arbitration, and to require him—indeed, to make it mandatory—to pay into court the money that he is claiming will not work.
Lord LLOYD of KILGERRAN: My Lords, I had anticipated what the noble and learned Lord upon the Woolsack would say, but I had not anticipated that the noble and learned Lord, Lord Diplock, would raise that point. We must introduce a certain amount of common sense into the situation arising, and to expect the plaintiff to pay an award into the court would, of course, be foolish. I should have thought that even with an Amendment tabled from these Benches on the Arbitration Bill we would not have heard a comment of that kind, if I may say so with the greatest possible respect.
However, we are dealing with a condition of a commercial arbitration. We are dealing with people who are not accustomed to come into the court. They do not know the rules of the court; they do not know what is within judges' discretion. I believe that if this Amendment were included in the Bill—that there should be payment into court of the amount of the award—that would probably help to reduce the number of frivolous and unmeritorious applications. Having regard to what the noble and learned Lord the Lord Chancellor has said, however, I beg leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
[Amendment No. 2 not moved.]
6.42 p.m.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 3:
Page 2, line 13, at beginning insert ("Subject to subsection (5A) below").
The noble and learned Lord said: My Lords, it may be convenient for us to consider together Amendments Nos. 3, 4 and 5. They share a common purpose—namely, to ensure that the arbitrator has prior notice that the award is required to be reasoned and to make the notice a condition precedent of an order under Clause 1(5) requiring the arbitrator to give his reasons.
I hope noble Lords will think that this Amendment gives substantial effect to suggestions made during the Committee stage—particularly by the noble and learned Lord, Lord Diplock—that a request by a party to the arbitrator during the reference for reasons to be given should be a condition precedent to an order being
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made under Clause 1(5) requiring an arbitrator to give his reasons. In giving effect to that proposal, the Amendment also introduces a degree of flexibility by enabling the court to make an order requiring reasons in the absence of such a request where there is a special reason why the request was not made. Examples of such special reasons would be where there was a genuine misunderstanding and a party relied on a trade practice that reasons are always given, or where he was led to believe, wrongly, that the other party had requested that reasons be given.
The Amendment of the noble Lord, Lord Lloyd of Kilgerran—Amendment No. 4—has a similar purpose to the Government Amendment, but I venture to submit that it is unacceptable: first, because it would often be impracticable to expect the parties to give notice that an appeal was likely, and what the area of law involved was likely to be before the arbitrator had made his award. Often it would not be until the award was made that any grounds for an appeal would become apparent, and it would be undesirable if the right to seek reasons were to be lost by default in such circumstances.
In addition, it would be contrary to principle for an arbitrator, who as such is exercising a quasi-judicial function, to be allowed to express an opinion on the worthiness of the appeal. I venture to submit that that should be a matter for the parties and the court. I beg to move.
Lord LLOYD of KILGERRAN: My Lords, as the noble and learned Lord upon the Woolsack indicated, Amendment No. 5 goes some way towards meeting the points which the noble and learned Lord, Lord Diplock, and I raised on the previous stage. However, as the noble and learned Lord the Lord Chancellor has referred to Amendment No. 4, with the leave of the House perhaps I may also speak to that Amendment and indicate the difference between my Amendment and Amendment No. 5. The main difference is that not only should the arbitrator give reasons, but he should give some views as to the law involved. In commercial arbitrations invariably the arbitrators give the reasons for their award. It should be required that the arbitrator be notified of the likelihood of an appeal and the area of law so concerned. This

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would allow the arbitrator to draft his awards so that he covered as fully as possible the facts and the reasons which are relevant to the potential appeal, thus avoiding as far as possible the court ordering more reasons long after the hearing, as apparently is permitted under Clause 1(5).
The noble and learned Lords the Lord Chancellor and Lord Hailsham of Saint Marylebone, in Committee saw difficulties about my Amendment providing that notification should be given to the arbitrator of an appeal. However, I understand that in practice it is unlikely that such difficulties will occur as, by the end of the hearing, both parties should usually be well aware of the areas of law involved in the dispute. I understand that your Lordships will be well aware that under the present system of the special case it is virtually universal that the special case is requested before the end of the hearing, and the area of law involved is often clearly demarcated, albeit without exact detail, so that all relevant persons are cognisant of the position. It may be that the actual questions of law require to be further sharpened up after the hearing, but this in no way derogates from the usual practice of an arbitrator's knowing the area of law involved before the end of the hearing. If this has been the practice so far for many years, there seems to be no good reason why under the new proposed procedure, the arbitrator should not be informed of the area of law applicable before the end of the hearing.
These questions of appeal are of considerable commercial importance. May I draw your Lordships' attention, for example, to a letter I have received—and no doubt many other Members of this House have received—from the President of the London Maritime Arbitrators Association. Mr. Bishop, the President, has said:
".… we cannot over-emphasise the strength of feeling expressed unanimously by the Committee"
of this Association
"both in regard to the exclusion of London maritime arbitrations from those international cases to which contracting-out privileges at any time are granted by the Bill and also at the proposed appeal procedure which will make London arbitration awards still open to review by the Courts. Such review is not what so many foreign parties intend to have built into their arbitrations and it is this factor which in many
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cases deters such foreign parties from agreeing to London arbitration of their contracts.
"We do feel that in so far as maritime arbitration is concerned the proposed appeal procedure provides no advantages whatsoever over the well-established and understood Special Case procedure under Section 21 of the 1950 Act and has a practical disadvantage in that it will lead to delays and more costly arbitrations".
I have also in my hand a letter from the director and secretary of the Institute of Arbitrators, Mr. V. W. Vigrass. He emphasises the importance of amendments to the proposed appeals procedure in the Act. He tells me that a Mr. Donald Davies referred to proposed amendments concerning the appeals procedure, which I have now moved and,
"Members of the Committee strongly supported an amendment on these lines which would eliminate the difficulties that are envisaged for arbitrators attempting to work within the provisions of the Bill as at present drafted".
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, I do not want to say very much about this matter. I am grateful to the Lord Chancellor for having listened to the argument on Committee. I think that his proposal is a fair attempt to meet the point made by my noble and learned friend Lord Diplock, and it also to some extent meets a point which I made both on Second Reading and at Committee. I have been concerned throughout that these grandees would have it all their own way. A great number of arbitrations are very small and deal purely with quality, or matters of that kind, very largely by inspection. It is not really the practice in such cases to give reasons and to contemplate appeal at all. I feel that the Lord Chancellor's proposals to some extent meet this fact.
It could very well be that in cases where the respondent to an arbitration claim in a small matter wanted to avoid payment that he would go through the appeal procedure as a means of delay. I said this on Second Reading and I say it again now. But now that the Lord Chancellor has introduced his Amendment, I think that that danger is largely safeguarded against. Naturally enough one takes seriously what the maritime arbitrators and others have been saying about this Bill, but I would say two things about it: first, it is of course a matter of policy whether or not you include maritime arbitrations. My own feeling throughout has been that you will not get this piece of

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legislation unless you stick pretty closely to Donaldson, because, as a predecessor of the Lord Chancellor said in the middle of the 19th century, law reform is either by consent or not at all. He was speaking from a lifetime of experience of both Houses (as I know the Lord Chancellor has) in trying to get legislation through. There is a means whereby the area of exclusion agreements can be added to by administrative means subject to the control of Parliament. I think we really ought to be content with that.
The only other thing I would say to them is that I think they have made a big mistake in thinking that the new procedure, whether it was superior or inferior to the old special case procedure which was being superseded, would make the courts more likely to interfere in arbitrations of any kind, whether commercial or not. My reading of the matter is the opposite: the courts will be discouraged from intervening, whereas under the reported authorities under the special case procedure they have tended perhaps to intervene too much. This is taken away from them and the boot, I think, will to some extent be on the other foot, now that the new procedure is being introduced. This is a matter of opinion evidently not shared by everybody, and therefore I put it forward with my customary diffidence.
The LORD CHANCELLOR: My Lords, I am grateful to the noble and learned Lord, Lord Hailsham, for having indicated that we have in the Bill sought to compromise the conflict of approach which has been identified by the noble Lord, Lord Lloyd of Kilgerran. I submit that what is proposed in my Amendments endeavours to meet a point of substance that was made at Committee stage, and it does so with a degree of flexibility. Accordingly, I maintain the first Amendment that I proposed.
On Question, Amendment agreed to.
6.56 p.m.
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN had given Notice of his intention to move Amendment No. 4:
Page 2, line 17, after (''court") insert ("it shall be a condition precedent to the application to the court that the arbitrator or umpire shall
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have been notified prior to the close of the hearing that his award is likely to be the subject of an appeal. In the event of the arbitrator or umpire being given notice that the award may be appealed on a point of law then he shall be notified of the area of law applicable and be permitted to state within his award whether or not he considers the appeal should be allowed. If")
The noble Lord said: My Lords, I shall be brief in this matter, as we have discussed the context of it. Having regard to the fact that the noble and learned Lord, Lord Hailsham, has referred to "grandees" so frequently in the course of these discussions, I wonder whether there is not a danger of looking at many of these matters from an ivory tower. The practitioners in this field have strong exceptions to certain parts of the Bill, particularly on appeal procedure. If, therefore, as we all agreed, the main object of this Bill is to attract arbitration to London, then the question of what should be done when the position is reached of a likelihood of an appeal is important in large cases.
The noble and learned Lord, Lord Hailsham, talked about arbitrations which are concerned with quality. There is usually no law involved in that at all; therefore it would be absurd to introduce mandatory clauses to deal with that kind of arbitration. But a person like myself is always in a difficulty about drafting in proper wording to cover all cases. I am concerned with those cases where there is a likelihood of appeal, where there is a likelihood of law being involved, and that an Amendment of this kind should be introduced. I am grateful to the Lord Chancellor for his Amendment No. 5 which goes some way to meeting the matter. In view of what he has already indicated, I shall not move this Amendment.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 5:
Page 2, line 23, at end insert—
(" (5A) The High Court shall not make an order under subsection (5) above unless it is satisfied—

(a) that before the award was made one of the parties to the reference gave notice to the arbitrator or umpire concerned that a reasoned award would be required; or

(b) that there is some special reason why such a notice was not given.").

On Question, Amendment agreed to.
6.59 p.m.
Lord HACKING Lord HACKING moved Amendment No. 6:
Page 2, line 34, at end insert—
(" (8) No appeal may be brought, nor application made, under this section, by a party to a reference under an arbitration agreement, which is not governed under English law, unless such appeal or application concerns a question or questions of English law.").
The noble Lord said: My Lords, Amendment No. 6 is one of three Amendments which concern foreign declaratory clauses. With your Lordships' approval I shall address the House on Amendments Nos. 6, 9 and 10 at the same time. In tabling these Amendments I am inviting the House to consider one of two ways of incorporating into this Bill foreign declaratory clauses. The first method that I am asking the House to consider is the pure declaratory clause which is set out in Amendment No. 10. This pure declaratory clause is the same in draft as the clause that I tabled in Committee and spoke upon in Committee except that I am not inviting the courts to give rulings when invited on points of foreign law. I have been frightened off by Lord Diplock's views about the Hamburg rules.
The other alternative method I am inviting your Lordships to consider is what I might describe as the restricted declaratory clause—Amendments Nos. 6 and 9—which deals only with a foreign law contract (which was the point raised by the noble and learned Lord, Lord Wilberforce) and which only concerns the specific right under the Bill to appeal under Clause 1 and to make an application under Clause 2.
I must begin by seeking to satisfy the House on the need for a foreign declaratory clause. I do so first on the basis that there is doubt overseas and that it would be of great assistance in the presentation of this measure abroad to clear the doubt. A number of noble Lords will have received a letter from Mr. Mark Littman, QC, a distinguished international arbitrator of immense experience, and will be aware of the argument which he puts in his letter to the noble and learned Lord the Lord Chancellor. Mr. Mark Littman supports without qualification the concept of a foreign declaratory clause and the concept that
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such a clause should be included in the Bill.
As noble Lords will be aware, I have been talking to and seeking opinion of a number of American lawyers who are concerned with international arbitration and, with the leave of the House, I shall read extracts from two letters which support this need overseas for a foreign declaratory clause in the Bill. The first quotation is from a letter from the General Counsel of the American Arbitration Association. It says:
"I understand that, save in exceptional cases, contracts that are governed by a law other than English law would not usually come within this stated case procedure".
Of course, read for that the new appellate procedure—
"It is my further understanding that it is not intended that contracts governed by foreign law would come within the new appeal and reference procedures. It seems to me that from the United States presentational point of view, it would be very desirable that this be made clear in an express provision in the legislation. It is common for example for attorneys to provide for Swiss law to be applicable if the arbitration is to be held in London. Having an express provision in the legislation indicating that in this situation the reference and appellate procedure do not apply would be most helpful".
My second quotation comes from a letter by a very experienced American international arbitrator and a senior partner in a major firm in Washington DC, Mr. Lloyd Cutler:
"My suggestion is that in the course of the legislative process, it be made explicit that no appeal shall lie to a British court on every question of law that is not a question of United Kingdom law. I understand it to be the view of the draftsman that this is already true under existing arbitration Acts and that there is no need to say so explicitly in the Amendment. However, the point is not clear to many non-British lawyers, especially in cases where the governing law of the contract is international law, or Jamaican law, or Israeli law, or Australian law or some other law which is derived from and still has close connections to United Kingdom law. To avoid risk, these lawyers will still decline to arbitrate in England in cases where an opting-out provision does not exist and is not attainable. In our country, where we pay more attention to legislative history than to the words of the statute, the problem could be resolved by an explicit sentence in a committee report or by a Question on the Floor answered by an authoritative spokesman for the Bill. Under British law, which is less respectful of legislative history, some other solution may be required, even an explicit amendment of the Bill.".
Those are the views from overseas, but I should draw to your Lordships'

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attention the fact that there is some doubt in this country. I have given notice to the noble and learned Lords the Lord Chancellor, Lord Hailsham of Saint Marylebone and Lord Diplock, of my intention to mention Oppenheimer v.Cattermole, which was heard by your Lordships' Judicial Committee in 1973, a case which may be familiar to some noble Lords. Lord Hailsham presided over that Judicial Committee and a then distinguished Member of the Bar, Sir Elwyn-Jones, Q.C., appeared for the taxpayer. I think I hear Lord Hailsham say "successfully", in which case we congratulate him.
Lord HAILSHAM of SAINT MARYLEBONE: Unsuccessfully, my Lords, but eloquently.
Lord HACKING: My Lords, can we retain the congratulations? That was a case which, among other things, was considering a foreign tax statute. The opinion of the Judicial Committee was delivered by the noble and learned Lord, Lord Cross of Chelsea, and on page 270 he said:
"The special commissioners preferred the views of Dr. Cohn on both points and since foreign law is a question of fact it might be argued that the view taken by the commissioners was binding on us even if we disagreed with it—unless indeed it was one which we thought no one could reasonably entertain. But in a case of this sort it would, I think, be unfortunate if we were obliged to give effect to a view as to the relevant foreign law which we thought to be wrong …".
Those lawyers from overseas who examine our case law authority may be gravely disturbed as to whether the law is beyond doubt in the United Kingdom.
I should like to recall the discussion thus far because we considered the matter in Committee. On the subject of the pure declaratory clause, there were two principal arguments against it, first that it was not necessary and against legislative practice and, secondly, (Lord Hailsham's point) that there was a danger of throwing doubt on the application of law in other areas. I am not sure that it is really unnecessary; one must remember, with respect, the counterbalance of the presentation advantage. Nor is there any real danger here, in my submission, of throwing doubt in other fields of law.
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In any event, this can all be avoided if Amendments Nos. 6 and 9 are adopted and No. 10 is abandoned. Indeed, that is precisely what I am inviting your Lordships to do; that is, to drop what I have described as the pure declaratory clause in Amendment No. 10 and adopt the more limited form of the proper law contract declaratory clause in Amendments Nos. 6 and 9. These Amendments come twice over because they deal first with the appeal provisions in Clause 1 and secondly with the reference provisions in Clause 2.
Your Lordships will recall that there is still a difficulty here—namely, the difficulty that, even though it is a foreign proper law contract, there still may, in certain circumstances, be questions of English law which arise during the course of the reference; for example, an arbitrator's conclusion on foreign law as against the weight of the evidence or the presumption of English law when no foreign law is pleaded or there is no evidence on that foreign law. One can think of Renvoi and other examples.
I am told by men much more experienced in arbitrations than myself that these situations rarely arise and that nobody need be concerned. However, this is all answered in the form of my Amendments, which would still allow points of English law to be raised, and I need only read Amendment No. 6, because exactly the same concept is followed in Amendment No. 9:
"No appeal may be brought, nor application made, under this section, by a party to a reference under an arbitration agreement, which is not governed under English law, unless such appeal or application concerns a question or questions of English law".
I have received a copy of the letter which the noble and learned Lord wrote recently to the noble and learned Lord Lord Hailsham of Saint Marylebone, following the Committee debates, and I recognise that the other way of dealing with the matter is—to quote the noble and learned Lord—"by education and publicity". Indeed, the noble and learned Lord, Lord Hailsham, gave the flattering suggestion to me that I might write an article in the Harvard Law Review. I am not sure that I have the scholarship to match the scholarship of the editorial board of the Harvard Law Review, but this, in my submission, does not answer the problem.

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We will all do our best to use such appropriate moments as arise for education and publicity, but we shall not be there at the crucial moment when, perhaps late at night in New York City, or in other places in the world, a contract is being negotiated and the lawyers and the parties to the negotiations come to consider the arbitration clause. But what will be there, if the Bill happily passes through both Houses of Parliament, will be the Act, and if that Act expressly states that matters of foreign law are not matters which will give rise to appeal or reference under the new procedures, then the matter will be put beyond any doubt whatsoever. That is precisely what I am seeking from your Lordships. I beg to move.
7.11 p.m.
Lord LLOYD of KILGERRAN: My Lords, I should like, briefly, to support the noble Lord, Lord Hacking, in the proposal that there should be included in the Bill a declaratory clause embodying the concept on foreign law in the way he has put forward. This kind of clause would be welcomed by commerce. The problem is essentially a marketing problem, and I should like to make the appeal that this is a matter considered from a marketing point of view, and not from the point of view of the ivory tower.
The LORD CHANCELLOR: My Lords, I am not sure that I accept the suggestion that I am existing in an ivory tower. We ran over this ground at the Committee stage, and I quite understand the eagerness of the noble Lord, Lord Hacking, that there should be a clear indication to American lawyers of the legal position. However, my experience of American lawyers is that they learn pretty fast, and I should have thought that the process of education which will follow the Bill when it becomes law, by way of the pronouncements of Lord Hacking and others, would soon alert our colleagues across the water to the position, though, with great respect, I should have thought that it was already fairly familiar ground to them.
I am afraid that I adhere to the view expressed at the Committee stage by the noble and learned Lord, Lord Hailsham of Saint Marylebone; namely, that the effect of inserting these clauses—the three
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Amendments seek to achieve the same purpose of being declaratory in their effect—could well be to cast doubt in all other cases not governed by the Bill where there is no Statute containing a declaratory clause. Therefore I believe that there would be a risk of undermining the doctrine of the law in cases other than those in which the Statute applies.
I should have thought that not only is it a well-established principle of English law that questions of foreign law are questions of fact, but that if this is not already known to American lawyers, they would discover that it is the case when they endeavoured to examine the new arrangements for arbitration. I take the view that the potential injury and confusion of the Amendment would more than outweigh the benefits in presenting this package to America and would be too substantial. Therefore, while I share the eagerness of the noble Lord, Lord Hacking, to effect the best presentation of this package, I think that what he proposes would be too high a price to pay.
7.14 p.m.
Lord HAILSHAM of SATNT MARYLEBONE: My Lords, I must say, for the little it is worth, that I agree with the noble and learned Lord on the Woolsack in everything that he has said. There are two quite separate points here, and I think that he has dealt with only one of them. I was rather hoping that he would deal with both of them, and perhaps, by leave of the House, he will do so at a later stage. I have no doubts whatever that he is right about Amendment No. 10. I would say to the noble Lord, Lord Hacking, that we cannot alter the general law of England, which extends over every field, that foreign law is a question of fact, simply to please the New York Commercial Arbitration Panel. If the panel does not know this rule of English law, then I wonder what Lord Hacking is doing, living in New York and advising his American colleagues, if he cannot tell them that. It would also astonish me if that principle were not also American law, for although I am acting now on the presumption, which is very seldom true, that foreign law is the same as English law, I should be rather surprised if the law of Japan is not a question of fact in American law; and the noble Lord, Lord Hacking has certainly not told us to the contrary.

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The noble Lord, Lord Lloyd of Kilgerran, has twice used the term the "ivory tower". The first occasion was when I ventured to say that I had some experience of small arbitrations, having lived in a humbler world than he. The ivory tower is usually associated with those who do not know the facts of life, but the fact is that as Lord Chancellor I played a very considerable part in trying to encourage, for instance, arbitration in the county court. That experience, apart from the fact that I have had many conversations at the Polytechnic of Central London with those who take part, for instance, in what is called the Small Claims Court, (which is in fact a form of arbitration) has convinced me of what I said then. This is not an ivory tower situation; it is based on a wider—not smaller—experience of the facts of life than has the noble Lord, Lord Lloyd of Kilgerran. In this particular Amendment—
Lord LLOYD of KILGERRAN: My Lords, again I am in the difficult position of not being able to use the precise words. An "ivory tower" may not be the right term, but what encouraged me to use it was the rather nonchalant way in which the noble and learned Lord dismissed all the arguments put forward by experienced arbitrators in the field (if that is the correct word). It may be that the noble and learned Lord has been a long time away from the real hurly-burly of arbitrations. I was merely emphasising that we are dealing with problems which many arbitrators have, and which many institutions have wished to be put forward to this House.
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, I was quite aware of what the noble Lord had in mind; I was merely pointing out that his experience ranged over only a limited class of arbitration. I was about to say that the second time the noble Lord used the term "ivory tower" it was about the noble and learned Lord the Lord Chancellor. It is a marketing problem, said the noble Lord, and apparently his contention there was that in order to market the Bill in the American market we have to fiddle about with its draftsmanship. I personally do not take this view at all. Drafting Bills is not an altogether simple matter, and I do not regard the draftsmanship of
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English legislation as being a marketing problem at all. The marketing is done somewhere else, by other people.
I was a little disappointed that the noble and learned Lord the Lord Chancellor did not deal with the second and, to my mind, the far more important point raised by this series of Amendments; namely, the point about the foreign law of contracts and the English law of contracts. The noble and learned Lord, Lord Wilberforce, referred to this at the Committee stage, and the noble Lord, Lord Hacking, in proposing the Amendment under discussion, raised it with the considerable weight given to it by our quadripartite correspondence with Mr. Mark Littman. I was wondering whether, with the leave of the House, the noble and learned Lord might add a word about that.
The LORD CHANCELLOR: My Lords, what I feel about the two Amendments we are discussing now, Nos. 6 and 9, is that they really add nothing to the Bill but merely declare the effect of the Bill—that points of English law, however they arise, are appealable under the Bill. I do not think they have a greater effect than that, and I should have thought that that was not a necessary proposition to establish in this legislation.
Lord DIPLOCK: My Lords, like my noble and learned friend Lord Hailsham, I regret that your Lordships were unable to accept favourably the suggestion made at the Committee stage by my noble and learned friend Lord Wilberforce, supported by myself, which indeed carries out a recommendation of the Commercial Court Committee itself, that if a contract is expressed to be governed by foreign law, such as Swiss law, then there should be a right to exclude reference to the court. It is true that in such case where the proper law is a foreign law, it is only in rare cases that English law will be relevant.Renvoi is one of the obvious ones. But if parties to a contract have chosen Swiss law, then in the ordinary course of events, if they took the matter to the courts, they would be accepting the Swiss view of what the English law is; and if they choose to go to arbitration instead of to the courts, and accept an arbitrator whom they regard as being an appropriate arbitrator for Swiss law, the proper law of the contract, then there seems to me to be no reason

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why they should not accept that Swiss view of what the law of England is, which they would be accepting if they had gone to the Swiss courts, which would have been the natural choice of curial law of the contract.
The Amendment moved by the noble Lord, Lord Hacking, does not deal with that position, which, I would remind your Lordships, was recommended by the Commercial Court Committee. What it would require is something of this kind—and I would invite the noble and learned Lord on the Woolsack to consider the possibility of this at the Third Reading stage. We want to strike out the last two lines, so that it would read (and I am reading from Amendment No. 6):
"No appeal may be brought, nor application made, under this section, by a party to a reference under an arbitration agreement contained in or relating to disputes arising under a contract which is expressed to be governed by a law which is not English law".
It would be of great assistance, I think, in the supranational contracts if a provision of that kind were included. It would very seldom have any effect because, as I say, it is only by such odd doctrines as Renvoi that English law would arise. But I would invite the noble and learned Lord on the Woolsack to consider that possibility, which has considerable support, at the Third Reading stage.
The LORD CHANCELLOR: My Lords, quite frankly, I found this a difficult matter, and I will not conceal that. I ventured to deal with this point in paragraph 8 of my letter to the noble and learned Lord, Lord Hailsham, which has been referred to, when I expressed the view that the Bill had got the dividing line about right by allowing points of English law, however they arise, to be appealed, but impliedly preventing appeals on foreign law. However, in the light of the view which has been expressed by the noble and learned Lords, Lord Diplock and Lord Wilberforce, I am certainly willing to look at it again. I am not sure that it touches directly upon the Amendments we are now discussing, but I should certainly be willing to look at that point and have further discussion on the matter.
Lord DIPLOCK: My Lords, I agree that it does not touch directly on the Amendments we are discussing, but I
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thought it would be a good opportunity to get it in.
The LORD CHANCELLOR: My Lords, I thought I saw a mischievous look in the eyes of the noble and learned Lord, Lord Diplock. I shall willingly do that, but I am afraid that, as at present advised, I cannot meet the wishes of the noble Lord, Lord Hacking, in the wider context of declaratory provisions.
Lord HACKING: My Lords, in a moment I am going to ask your Lordships' leave to withdraw this Amendment, but before I do so I should like to pass a few comments. It is perfectly true that in support of my argument I used opinions which had been expressed to me in New York, for the very good reason that I work there and that I hear opinions expressed to me in New York. But I am not speaking for any sector in the international community; nor, indeed, for any sector in any community. I am just anxious that, where there is a doubt in the law of England, that doubt should be resolved in the clearest possible terms.
As I said in my first submissions to the House on this matter, the vehicle which I described as the pure declaratory clause is clearly not the appropriate vehicle, or at least has such resounding opposition to it as is sufficiently strong to give it no prospect of receiving the assent of this House. Perhaps I have been guilty of loose terminology, because my Amendments Nos. 6 and 9 are not really declaratory Amendments; they merely state the rights of the parties under, first of all, the appeal procedure and, secondly, the reference procedure in Clause 2. It is the rights of those parties that, in my submission to your Lordships' House, have been at least clouded by the decision of the judicial committee which I drew to your Lordships' attention. I find it somewhat surprising, if I may say so to your Lordships, that nobody sought to counter my argument there, when I read from one of the opinions, from the opinion of the noble and learned Lord, Lord Cross, who clearly crossed over, within those few sentences, the frontier between questions of fact and questions of foreign law.
Having made those comments to your Lordships' House, I hope that, in the light of what the noble and learned Lord,

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Lord Diplock, has said, the noble and learned Lord the Lord Chancellor will give further thought to the concept contained in Amendments Nos. 6 and 9. I would never put myself before your Lordships' House as a drafter par excellence of any Parliamentary legislation. It is not my drafting, it is the concept, on which I am seeking to persuade. Having said those words, I beg the leave of the House to withdraw Amendment No. 6.
The LORD CHANCELLOR: My Lords, in response to what the noble Lord has said, I shall certainly look at Amendments Nos. 6 and 9 in the context, although it is a slightly different context, I think, of what the noble and learned Lord, Lord Diplock, has said.
Amendment, by leave, withdrawn.
7.30 p.m.
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendment No. 7:
Page 2, line 34, at end insert—
(" (8) All appeals from awards relating to (a) intellectual property or (b) the Treaties or Community Treaties as defined in the European Communities Act 1972 or (c) Articles 85 or 86 of the Treaty of Rome shall be referred to the Patents Court.").
The noble Lord said: My Lords, this is in the nature of a probing Amendment. It is to the effect that all appeals from award relating, first of all, to intellectual property shall be referred to the Patents Court. It is not quite clear whether intellectual property matters would be referred directly to the Patents Court. It would be preferable, it seems to me, to have such matters referred to a specialist tribunal such as the Patents Court. The expression "intellectual property" covers not only patents, but also trade marks, confidential information, designs; and it is a broad term. It seems to me that it might be helpful if, in the Bill, there was a reference that these appeals would go to the Patents Court. The noble and learned Lord may feel that the problem does not arise in practice, but it would be helpful to have a declaration that intellectual property, as a whole, should go to the Patents Court.
Coming for a moment to the question of an ivory tower, I have been closely concerned over my life with patent
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matters and I remember the great difficulty it was for members of the Patent Bar to get a Patent Judge. I remember the opposition that was made in high circles to the appointment of a Patent Judge. The late Mr. Justice Lloyd-Jacob was the first Patent Judge. We practitioners in this country were the envy of practitioners from all over the world in that at last we were able to put to a distinguished patent practitioner who had been made a Patent Judge these difficult matters of science and law. Therefore, on this aspect I would ask the noble and learned Lord to consider whether a declaratory statement as to intellectual property would not be helpful. As to the two other parts of my Amendment, (b) and (c), the noble and learned Lord has already written me about those matters and therefore I shall not press subparagraphs (b) and (c) in begging to move this Amendment.
The LORD CHANCELLOR: My Lords, to hear the noble Lord, Lord Lloyd of Kilgerran, speaking on patent law and the Patent Court is to be in the presence of an unqualified admirer of both. He and I, and noble and learned Lords who are in the House, achieved, I hope, considerable progress in the patents field in our Patents Act, which I remember so well from last year, having had to learn so much in order to try to understand it. What this Amendment proposes is that patent matters should necessarily be assigned to the Patents Court. The assignment of business within the High Court is usually, but not always, dealt with by Rules of Court. The Patents Court is a part of the Chancery Division and the assignment of business is expressly provided to be a matter for the Rules of Court. If a case was shown for assigning to the Patents Court questions of law arising out of arbitrations relating to intellectual property, the Rule Committee could assign such business to that court. But I think it is important to maintain flexibility in these matters and that it would not be desirable for the question to be determined finally and immutably in the Bill.
Even without any Rule of Court it would be open for an approprite case to be assigned to a Patent Judge sitting as a judge of the Chancery Division; and I think that is what in practice would happen. We now have strengthened the Patents Court and I think, in the new

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situation in which we are, that what the noble Lord would seek to achieve will, in practice, be achieved.
Lord LLOYD of KILGERRAN: My Lords I am grateful to the noble and learned Lord for what he has said. In the circumstances, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 2 [Determination of preliminary point of law by court]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 8:
Page 2, line 36, leave out from ("Court") to ("with") in line 39 and insert ("made by any of the parties to a reference—

(a) with the consent of an arbitrator who has entered on the reference or, if an umpire has entered on the reference, with his consent, or

(b)").

The noble and learned Lord said: This Amendment is a response to the warning given by the noble and learned Lord, Lord Diplock, during the Committee stage that subparagraph (a) of Clause 2(1) could well be a dead letter, as arbitrators would be unwilling to incur the cost and trouble of applying to the High Court for the determination of a preliminary point of law. Accordingly, the Amendment would have the effect of enabling a party, with the arbitrator's consent, rather than the arbitrator himself, to apply to the High Court for the determination of a preliminary point of law. That seems to be the most senbile way of dealing with the matter. I beg to move.
Lord HAILSHAM of SAINT MARY-LEBONE: My Lords, I think that the noble and learned Lord has made an excellent response to my noble and learned friend Lord Diplock. There is only one short point I should like to draw to the attention of the House. If this Amendment is passed, as it will be, I think that perhaps the Rules Committee should be asked to state how the consent of the arbitrator should be signified.
The LORD CHANCELLOR: My Lords, I will see that that is done.
On Question, Amendment agreed to.
[Amendments Nos. 9 and 10 not moved.]
Clause 3 [Exclusion of rights under sections 1 and 2.]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 11:
Page 3, line 20, leave out ("the section") and insert ("this section and section (Exclusion agreements not to apply in certain cases unless entered into after commencement of arbitration)below").
The noble and learned Lord said: My Lords, with this Amendment, it may be convenient to consider Amendments Nos. 28 and 29. Clause 3, as your Lordships will have noticed, is already very lengthy. It consists of no less than nine subsections. The addition of the two further subsections which I propose to insert—Subsections (2A) and (5A)—would make it very unwieldy. Therefore, it is proposed to divide Clause 3 into two clauses in the way indicated at the natural break point after new Subsection (5A). These two minor Amendments which are set out are consequential upon that basic division. I beg to move.
On Question, Amendment agreed to.
Lord HACKING Lord HACKING moved Amendment No. 12:
Page 3, line 28, at end insert ("and
(d) subject to subsection (2) below, no application may be made under subsections 23(1) or 23(2) of the principal Act").
The noble Lord said: My Lords, I would ask your Lordships to consider together Amendments Nos. 12, 13, 14 and 15. Having said that, I would draw your Lordships' attention to this: the noble and learned Lord himself has tabled Amendment No. 17, which covers the same ground as my Amendment No. 13. Therefore, at this stage I do not intend to address the House on Amendment No. 13, although, as I have indicated, it is within the group of Amendments Nos. 12, 13, 14 and 15. Your Lordships will recall from the Committee stage that I have concern that there may be other vehicles of abuse available to the parties once the case-stated procedure, and the other rights to set aside an arbitration award on the grounds of errors of fact on the face of the award, arc abolished.
The purpose, therefore, in moving Amendments Nos. 12, 14 and 15 is to enable parties to international agreements

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to exclude the operation of the misconduct provisions in Section 23(1) and (2) of the Arbitration Act 1950 except when the arbitrator has acted dishonestly, which is a very rare occasion. Mr. Justice Donaldson recalled only one case in 30 years of practice at the Bar or on the Bench. It covers such examples as the arbitrator's acceptance of a bribe. Even though these circumstances are so rare, there should be some power, when and if that occasion arises, to remove an arbitrator. The second exception is when an arbitrator has acted in breach of natural justice. I hope that the noble and learned Lord, Lord Hailsham, will note that the word "gross" has been removed from my Amendment. The third exception is when an arbitrator has acted in excess of his authority. What I am asking therefore is that the misconduct provisions contained in Section 23 should apply to international agreements only when: (1) the arbitrator has been dishonest; (2) he has acted in breach of natural justice; or (3) he has acted in excess of his authority.
So far as Amendment No. 14 is concerned, it is a tidying-up Amendment at the end and I need not address your Lordships on that. I accept again that the terms of my drafting may be found wanting. I am seeking agreement on the concept and not the terms of my draft. I accept also that, as drafted, my provisions affect domestic exclusion agreements made after the commencement of arbitration as well as to international exclusion agreements which are made at the time of the contract or thereafter. I believe this to be a real concern. There are very large sums of money at stake and experience has shown in recent years that parties will seek any means for abuse. Of greater importance, those who examine our law after the passage of this Bill will be looking through the Act, particularly Section 23, and they think that, at the time the contract is made, there is this power to abuse the system.
As the noble and learned Lord who sits on the Woolsack will be aware, I have support from Mr. Justice Donaldson and Lord Justice Megaw. These are two judges of eminent experience in the commercial field. I emphasise this time that I am not seeking generally to alter Section 23(1) and (2) or to disturb the
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settled authorities which have come under those two sections. I am asking the House to fall into line with the practice of other jurisdictions.
It may be helpful for your Lordships to know how the United States Arbitration Act, Section 10, deals with the problem. It is entitled: "Same; Vacation; Grounds; Rehearing". It reads as follows:
"In either of the following cases the United States court in and for the district wherein the award was made may make an order vacating the award upon the application of any party to the arbitration—

(a) Where the award was procured by corruption, fraud, or undue means.

(b) Where there was evident partiality or corruption in the arbitrators, or either of them.

(c) Where the arbitrators were guilty of misconduct in refusing to postpone the hearing, upon sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy; or of any other misbehavior by which the rights of any party have been prejudiced.

(d) Where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made …"

I could quote—but I shall not burden your Lordships—other jurisdictions which follow through on the same concept. I also submit that these Amendments are not out of line with practice in England. I refer to a lecture which Mr. Justice Donaldson gave to the Institute of Arbitrators last summer. This is what he said.
"All systems of law provide that the National Courts shall have a supervisory jurisdiction over arbitrations. This is clearly necessary and I doubt whether any arbitrator would have it otherwise. The biased or fraudulent arbitrator is almost unknown in this country. Certainly I have only heard of one in over 30 years of practice. But there must be some power to remove him when he does appear.
"This jurisdiction also extends so as to enable the Courts to intervene if an arbitrator acts in breach of the rules of natural justice. This is not as heinous an offence as it sounds. Indeed, on the rare occasions when it occurs, it arises largely as a result of mistake or ignorance. For example, an arbitrator may get himself in to the position in which he receives evidence from one side and, thinking that the other side know all about it, fails to give them any opportunity for answering it. These things can happen even in the best regulated arbitrations. And when they do, someone should be able to set the proceedings aside and let the parties start again.
"Finally, the Courts must have power to step in when an arbitrator exceeds his jurisdiction. This, too, sounds to be a heinous offence, but, of course, it is not. An arbitrator's jurisdiction depends upon the consent of the parties and this

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is usually contained in the contract which has given rise to the dispute. Once the existence of that contract is in issue, so is the jurisdiction of the arbitrator and no one can determine his own jurisdiction. The arbitrator must therefore take a view on whether he has or has not jurisdiction. If he thinks that he has jurisdiction and is wrong, a Court must have power to set the award aside.
"So much for the supervisory jurisdiction of the Courts. No one has criticised it and I do not anticipate any changes. However, the Appellate or review jurisdiction of the Courts is a different matter. This has been under close study by the Commercial Court Committee."
On those two grounds—-that my Amendments are consistent with existing practice in England and that they are consistent with the practice in other jurisdiction—T commend them to your Lordships. I beg to move.
7.45 p.m.
The LORD CHANCELLOR: My Lords, in considering Amendments Nos. 12 to 15, it is at any rate pleasing to me that I have been able in regard to Amendment No. 13 at last to go a great deal of the way with the noble Lord. I wish I could have done it in other matters, too. We shall come to the fraud aspect of the matter in a moment and perhaps when I move Amendment No. 17. What remains is the variant, if I may so describe it, of the proposal that the noble Lord, Lord Hacking, made at the Committee stage to Amendments which would have enabled the parties to contract out of the misconduct jurisdiction altogether. Then a separate operation would have narrowed the scope of the jurisdiction generally. Now the Amendment seeks to safeguard the power of the court to intervene where—and I use the word "grosser" without being wedded to it—the grosser forms of misconduct are alleged but not otherwise.
The difficulty that the House must face is that the attempt to distinguish between the various forms of misconduct is inevitably a difficult one and an uncertain one in a field which is governed by a good deal of case law. In my view—and I have said this in my letter to the noble and learned Lord, Lord Hailsham of Saint Marylebone—changes in this area should be contemplated only after thorough consideration of the issues involved. Frankly, there has not been thorough consideration of this difficult field as yet either by the Donaldson Committee or by departments, and I am afraid that as we want to get this Bill on the Statute
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Book there is not time for it now. In any event, the categories of misconduct which Lord Hacking's Amendment would preserve from the right to contract out leave a broad, uncertain and, I submit, potentially elastic field over which the court's jurisdiction would be maintained in any event. I feel that if exceptions of that breadth are needed, the usefulness of the Amendment to contracting parties is greatly reduced. They would leave the extent of the right to contract out far more uncertain than is the position under the Bill as it now stands.
In any event, is not Section 23 and its provision unlikely to prove an alternative source of delay as the court has power under subsection (3) of that section to order that all or part of the award be brought into court? I would have thought that that power should be sufficient to discourage spurious applications under the umbrella of misconduct. I hope accordingly, partly for the avoidance of long delay and further consideration of a very difficult field, that the noble Lord will not press these Amendments.
Lord HACKING: My Lords, I will not press these Amendments and in a moment I will withdraw them. May I say that I was not—I do emphasise this again—seeking to disturb as I did seek to disturb for very good reasons, as I like to think, the wording of Section 23. I was merely moving these Amendments, seeking to define the use of Section 23 as it refers to international agreements. The noble and learned Lord has raised various objections. I, if I may, would like to consider them and in the meantime I beg leave to withdraw the Amendments.
Amendments, by leave, withdrawn.
7.50 p.m.
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendment No. 16:
Page 3, line 34, at end insert—
(" An agreement in writing shall include any agreement in the written or typed form but shall exclude all agreements in printed or clearly in standard form.")
The noble Lord said: My Lords, I beg to move Amendment No. 16 and, with the leave of the House, I should like to speak to Amendments Nos. 21 and 22 in order to try and save some time at this late hour. The effect of these Amendments to

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Clause 3 would be that all international agreements and all domestic arbitrations in relation to intellectual property and EEC competition law will come within the proposed legislation, which allows parties to enter into an exclusion agreement at any time, so long as such an agreement is in the written or typed form.
The clause, as amended, will also allow the Secretary of State to extend the right of exclusion agreements to domestic arbitration if it becomes necessary or expedient, subject to the annulment provisions of Section 3(9). These are of profound significance, I submit, to commercial interests. It seems to me there is no logical case for distinguishing between supranational and special category disputes of an international character, as the Bill now stands. It would appear to me sensible that all international agreements should be treated in the same manner, particularly when the parties appoint the arbitrators and the arbitration proceeds on the usual ad hoc basis. The arbitrators who sit on the international special categories disputes tend to be of a very experienced kind. The noble and learned Lord, Lord Diplock, emphasised this when he gave his views on the appeals procedure during the Committee stage of the Bill. Indeed, he pointed out that he felt there were numbers of experienced arbitrators who would be able to give their views on appeals, which would be helpful.
During the Second Reading of the Bill, no speaker seemed to me to make a valid case for distinguishing between supranational and special category disputes. The only reason for distinguishing between the two came from the noble and learned Lord, Lord Diplock, who stated, as reported in Hansard on 12th December, col. 450:
"There are many branches, or at any rate several branches, of commerce in which it is impossible in practice to trade, or to enter into a transaction, except upon a standard form prepared by a trade association, customarily on the Baltic, or whatever it may be. If you want to enter into that kind of contract, that kind of transaction, at all, you are, for practical purposes, forced to contract upon the standard terms. The danger is that the standard terms will include an exclusion term to which the other party to the contract, or indeed neither party to the contract, has an opportunity of saying, ' No, we want to reserve our normal rights.' That was the reason why I, at any rate, took the view that the special category contract ought to be excluded for the time being."
The objection raised by the noble and learned Lord if, with great respect to him, it could be at all valid, could be removed, it seems to me, by the Amendment relating to type added clauses which ensures that the parties apply their minds to an exclusion agreement, as the noble and learned Lord would have wished.
In the Committee stage, the noble and learned Lord the Lord Chancellor said—I rather think it was more in jest than otherwise—that a party who wished to exclude the new right of appeal would merely have the standard contract typed or written out, if my Amendment were accepted. Again, with great respect, I think he may forget how contracts are negotiated in the commercial world, particularly in respect of international agreements. It is highly unlikely, in my experience and in that of many well-known arbitrators who have written to me, that parties will indulge in the manner suggested by the noble and learned Lord the Lord Chancellor.
In any event, I again find myself in a difficulty about the wording of any amendment and it is the principle, therefore, that I am trying to get across. In the event, my Amendment could be tightened up to take care of the point raised by the noble and learned Lord the Lord Chancellor by stipulating that an exclusion agreement had to be by way of a special addendum to the contract.
All that is necessary in order to deal with the point raised by the noble and learned Lord, Lord Diplock, is really to ensure somehow that the parties have had an opportunity of discussing the whole matter and that the standard form is not imposed directly. With great respect to the noble and learned Lord, I suggest that the Amendment I have put forward, possibly with a slight improvement in words that the noble and learned Lord the Lord Chancellor could no doubt introduce without any difficulty, would be a useful Amendment to introduce into the Bill.
Again, in addition to those points, it is perhaps worth remembering that the parties to all international agreements would only be given the freedom to contract out. There is no question of abolishing judicial review and that question of principle did affect the minds of certain noble and learned Lords during the

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Committee stage. Many parties in the course of practice would not contract out of judicial review and there would be ample simple cases going to the courts to ensure the continuation of the development of English commercial law.
The fear was expressed to your Lordships that there might be built up a "closed shop", as it were, of law developed by arbitrators to the exclusion of the courts. That danger, in my submission, would not arise. However, there is a danger from another point of view: that if the shipping, insurance and commodity contracts—these are special categories—are not allowed to fall within the exclusion agreement provisions, the so-called supranational contracts may well be seriously affected because of those contracts having shipping, insurance or commodity aspects attaching to them, and they would not be brought to arbitration in this country.
It might well be, therefore, so I am advised, that the major aim of this Bill, to attract the supranational to London arbitration, would be lost because of the exclusion of special category international disputes from the special exclusion agreement provisions as at present in the Bill. Uncertainty would arise as to whether or not supranational agreements fall within the exclusion provisions, and thus many foreign organisations would be wary of agreeing to London arbitration for fear that a party might use shipping, insurance or commodity features of the contract in order to use the appeal procedure of judicial review. In this context, the present Bill refers to the "Admiralty jurisdiction of the High Court", rather than to shipping, and this jurisdiction is a very wide one. It covers virtually every aspect of shipping and matters incidental to shipping. Many large organisations which are prolific users of London commercial abritration have indicated that they want the freedom to contract out of judicial review at any time, and failure to give them this freedom would see London being used less and less as an arbitration centre in the future. My Lords, I beg to move.
8. p.m.
The LORD CHANCELLOR: My Lords, we covered some of this ground at the Committee stage. The aim of the
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Amendment, as I understand it, is to prevent exclusion clauses from being forced on unwilling parties in standard form contracts. But I again venture to say what I said at an earlier stage, that the Amendment is impracticable, as the party wishing to exclude the new right of appeal would merely make such modifications to the standard form as were necessary to destroy the standard form of the contract, and would have the standard contract typed or written out with such modifications as were required.
Further, I am advised that while the Amendment appears to be aimed at standard form contracts, it is drafted so that it bites on standard form exclusion agreements. As a result, if an exclusion agreement in a standard form appears as a term of even a one-off contract which has been closely negotiated between the parties, it would still be ineffective. As it is likely that standard form exclusion agreements would be used even in such one-off contracts, the Amendment might have the result, for practical purposes, of rendering the right to exclude applications to the court under the Bill nugatory. In those circumstances, and in the light of those dangers, perhaps the noble Lord will reconsider the Amendment.
Lord HACKING: My Lords, before the noble Lord withdraws his Amendment or takes a different position upon it, I should like to give him support in one area. A likely consequence of the passing of this Bill—as we hope, it will be passed—into an Act, is that arbitration bodies will incorporate the exclusion clause into the rules of those arbitration bodies. That presents a real problem, which I think the noble Lord, Lord Lloyd, was focusing upon when he was moving this Amendment.
Lord DIPLOCK: My Lords, the Explanatory and Financial Memorandum to this Bill starts with the sentence:
"The Bill implements provisions of the report on arbitration by the Commercial Court Committee."
The question of special category disputes was discussed almost interminably in many fora. I myself would have made a slightly different dividing line between special category disputes and the others, though a much more elaborate one than my noble friend Lord Lloyd suggests in these Amendments. The Commercial

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Court Committee, however, came to a different conclusion as to where the dividing line is to be. I accept their conclusion, because I am extremely anxious that a Bill to this effect should come into force as soon as possible, and to try to raise again these controversies, which went on and on, is an infallible recipe for losing the Bill.
Lord LLOYD of KILGERRAN: My Lords, before the noble and learned Lord sits down, may I say that he emphasised that there were interminable discussions upon this point in the Commercial Court Committee. I am advised—and perhaps he could help me on this matter—that the views of certain eminent arbitrators and institutions were not considered in the course of what the noble and learned Lord referred to as "interminable discussions". One of the reasons why I am presuming to raise these matters is that—
Lord HAILSHAM of SAINT MARY-LEBONE: My Lords, this is a second speech. It is the Report stage.
Lord LLOYD of KILGERRAN: My Lords, why I am presuming to interrupt the noble and learned Lord is because these are matters that were put to me, and I should be grateful for his comments.
Lord DIPLOCK: My Lords, I have been subject to the same lobbying as my noble friend Lord Lloyd of Kilgerran. The Commercial Court Committee has a composition which can easily be found, and all the relevant interests are represented there.
The LORD CHANCELLOR: My Lords, I hope that the noble Lord, Lord Lloyd of Kilgerran, will take note of that solemn warning which we have just heard from the noble and learned Lord, Lord Diplock.
Lord LLOYD of KILGERRAN: My Lords, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
8.7 p.m.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 17:
Page 3, line 41, at end insert—
(" ( ) In any case where—

(a) an arbitration agreement, other than a domestic arbitration agreement, provides for disputes between the parties to be referred to arbitration, and

(b) a dispute to which the agreement relates involves the question whether a party has been guilty of fraud, and

(c) the parties have entered into an exclusion agreement which is applicable to any award made on the reference of that dispute,

then, except in so far as the exclusion agreement otherwise provides, the High Court shall not exercise its powers under section 24(2) of the principal Act (to take steps necessary to enable the question to be determined by the High Court) in relation to that dispute.")
The noble and learned Lord said; My Lords, this Amendment would have the effect that where the parties had validly contracted out of the right to apply to the High Court under the Bill, the High Court's power to intervene and assume jurisdiction under Section 24(2) of the Arbitration Act in cases where fraud is alleged against a party would also be excluded, unless the parties otherwise agreed. There is no fundamental objection, as I submit, to allowing the parties to agree that their chosen tribunal should determine questions of fraud as between themselves, and this Amendment would have the advantage of allowing parties to block off that alternative avenue of delay. It is substantially the same as Amendment No. 12, which had been put down by the noble Lord, Lord Hacking, and I hope that it will receive the approval of your Lordships. My Lords, I beg to move.
Lord HACKING: My Lords, I rise to my feet only to express gratitude.
On Question, Amendment agreed to.
8.8 p.m.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 18:
Page 4, line 11, leave out from ("agreement") to ("unless") in line 12.
The noble and learned Lord said The noble and learned Lord said: My Lords, with this Amendment, it may be convenient to deal also with Amendments Nos. 19, 20, 30 and 31. The purpose of both my Amendment and the Amendment of the noble Lord, Lord Hacking, is to ensure that, for the purpose of the right

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to contract out of applications to the court, the domestic or non-domestic character of an arbitration agreement should be determined once and for all at the time when the agreement is made. This Amendment repeats in substance the definition of a domestic arbitration agreement in Section 1(4) of the Arbitration Act 1975, save that it refers to "he time the agreement was entered into" rather than, as in Section 1(4) of the 1959 Act, "the time the proceedings are commenced".
The Amendment of the noble Lord, Lord Hacking, while aimed at the same purpose as my Amendment, would amend the definition of a domestic arbitration agreement in Section 1(4) of the 1950 Act itself. That definition was carefully tailored to enable the United Kingdom to accede to the New York Convention on the enforcement of arbitral awards, and should not therefore be amended for the collateral purpose of this Bill. I hope the noble Lord may think that my Amendment meets the point of substance that he himself was making. My Lords, I beg to move.
Lord DIPLOCK: My Lords, there is a point on Amendment No. 20. Although it meets the point that you can tell whether or not the agreement is an arbitration agreement for the purposes of deciding whether an exclusion agreement can be made, it does not meet the point about the mandatory refusal of a stay under Section 1 of the Arbitration Act 1975. It would be desirable, I suggest, that it should cover also the right to a mandatory stay where there is an exclusion agreement—that is to say, where the parties were foreign or non-foreign at the time that the agreement was made. I thought that I had found a way of doing it, but now that I look at it I am a little doubtful, because there are so many negatives in the definition. I believe that if one inserted:
"In this section ' domestic arbitration agreement ' means and in Section 1 of the Arbitration Act 1975 includes …"
we might get the answer, but I would not bet on it. However, there is a point about the mandatory stay which is not covered by Amendment No. 20 and would be covered by the other Amendments, but they have objections to them of a different kind.
Lord HACKING: My Lords, I should like to express gratitude to the noble and learned Lord for having taken up this matter. If my recollection is correct, this was the only Amendment which I moved during the Committee stage upon which I did not immediately get a cold shower from the noble and learned Lord. Therefore I am grateful to him for having moved this Amendment. There are two problems, one of which has been aired by the noble and learned Lord, Lord Diplock. The first is that the result of this Amendment will be that there will be two definitions of domestic arbitration agreements set at two different times: first, the definition in the 1975 Act—set at the time of commencement of proceedings—and the second under this Bill: set at the time that the contract was made. That is my terminology: the terminology of the noble and learned Lord is "entered into".
The second problem—and this is the point which the noble and learned Lord, Lord Diplock, made—is that this does not deal with the inherent weakness in Section 1(4) of the Arbitration Act 1975; namely, that at the time that the parties contract they do not know whether at a later time that contract will cease to be an international contract and become a domestic contract and that what was a mandatory power in the courts at the time that they made the agreement—namely, the mandatory power to stay any court proceedings once arbitration proceedings have been commenced—may go if the agreement becomes a domestic agreement. Hence, on this matter of stay as well as under this Bill, the parties do not have the assurance at the crucial time of making the contract. It is on those two grounds that I respectfully ask the noble and learned Lord to review this Amendment.
The LORD CHANCELLOR: My Lords, since it is a technical matter I am certainly willing to look at it again, in case we have not got it quite right. Accordingly, I beg leave to withdraw Amendment No. 18.
Amendment, by leave, withdrawn.
[Amendments Nos. 19, 20 and 21 not moved.]
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendment No. 22:
Page 4, line 16, leave out subsections (6) and (7).
The noble Lord said: My Lords, I beg to move Amendment No. 22. Its purpose is to omit subsections (6) and (7). I put forward my arguments in favour of deleting these two subsections when I spoke to Amendment No. 16. I indicated then that there was no logical case for distinguishing between supranational and special category cases of an international nature and that it appeared to be sensible that all international agreements should be treated in the same manner, in particular when the parties appoint the arbitrators and the arbitration proceeds on an ad hoc basis. I did not apprehend that the noble and learned Lord dealt with that point—he dealt very severely but charmingly with my Amendment No. 16. My only reason now for moving Amendment No. 22 is to give the noble and learned Lord an opportunity to pay some direct attention to it. I beg to move.
The LORD CHANCELLOR: My Lords, we have already covered this ground, which relates to one of the more controversial provisions in the Bill. The view that seemed to meet with the approval of the House was that the compromise in the Bill was the best that we could arrive at in order to secure its early passage. Those who attach importance to the uniform development of English commercial law and its contribution to international commercial law—they are the judges and, broadly speaking, the lawyers—favour the court's supervision over the kinds of dispute we are considering here (maritime, insurance and commodity contracts) at least until some experience of the working of the provisions contained in the Bill has been gained.
On the other hand, I appreciate that many interests within the business community wish to have the widest possible powers to exclude by agreement at any time the High Court's supervisory jurisdiction over arbitration. I draw attention to the provision in the Bill giving to the Secretary of State power by order to extend the right to contract out to the special category of disputes that we are speaking of now. I hope that in the circumstances this compromise arrangement will be acceptable so that we may
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see how things work out. When they are shown to work satisfactorily, the matter can then be dealt with by order by the Secretary of State.
Lord HACKING: My Lords, I find this to be a difficult matter. There is absolutely no logic to the creation of the special category of disputes identified in the field of Admiralty, insurance and commodity. The shipping commercial communities feel strongly that the parties ought to be left to contract out of the judicial process, and they are, as recognised in the commercial court committee's report, almost always of "equal bargaining power." These provisions have also brought out criticism from the advisers on supranational contracts.
I have presented one side of my concern, but there are, on the other hand, views that these three categories of contracts have made a massive contribution to English commercial law. It is as a result of this massive contribution to English commercial law that, without any modesty, we can all reflect that this is the reason why so many countries wish to come to England for their arbitration and, indeed, to deal with their commercial disputes. It is because of the strength and experience of English commercial law and English commercial lawyers.
There is another matter which also causes me concern. To cut the bridge between the courts of arbitration and the courts of law could result in the development of an arbitration commercial law different from a court commercial law, as has been the experience in New York. Therefore, I venture to suggest to your Lordships that the question we have to ask ourselves is whether we have reached the right compromise. It is for that reason that I would earnestly ask the noble and learned Lord the Lord Chancellor to think very carefully about the matter.
The LORD CHANCELLOR: My Lords, if I may say so, I have already thought about it very carefully. This recommendation of the commercial court committee seems to be the realistic one to make at this point in time.
Lord HAILSHAM of SAINT MARY-LEBONE: My Lords, I believe that we must stick to the commercial court

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committee or lose the Bill. I may be wrong about this; it is a pure political judgment which has nothing to do with law. However, my judgment of the matter is that we have a better chance of getting this Bill in its present form than in any other.
Lord LLOYD of KILGERRAN: My Lords, I am grateful for the support given to these Amendments by the noble Lord, Lord Hacking, and I fully appreciate the problem which has been adumbrated by the noble and learned Lord, Lord Hailsham. A great deal of information has been put to noble Lords about the practical commercial aspects in relation to these two classes of contracts and in particular relating to subsections (6) and (7). The noble and learned Lord, Lord Diplock, suggested that he had been subject to the same lobbying in these matters as I had been, and I fully appreciate that the noble and learned Lord, Lord Diplock, in referring to the lobbying was not introducing any derogatory atmosphere in relation to the word "lobbying".
Lord DIPLOCK: My Lords, I did not intend to. It is very proper that people should write and express their views to those of us who are Members of either House of Parliament, and are concerned with legislation.
Lord LLOYD of KILGERRAN: My Lords, I am much obliged to the noble and learned Lord for that explanation. But an attitude had been presented to me that the Commercial Court Committee had not been in a position, for a variety of reasons, fully to examine submissions made by eminent arbitrators and eminent institutions. But be that as it may, in these circumstances and having regard to the indications of the noble and learned Lord the Lord Chancellor, I beg leave to Withdraw the Amendment.
Amendment, by leave, withdrawn.
8.22 p.m.
Lord HACKING Lord HACKING moved Amendment No. 23:
Page 4, line 16 leave out ("an arbitration award or")
The noble Lord said: My Lords, in moving this Amendment, I also ask your Lordships to consider Amendment No. 24
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at the same time. I believe that these two Amendments coupled together represent the right position of compromise upon this difficult matter of the special category disputes. The noble and learned Lord, Lord Hailsham, says, with great political experience behind him, that the sensible course is to adopt the Commercial Committee's report. The difficulty here is that this Bill goes one step further: it does not simply adopt the Commercial Committee's report. It creates a second form of judicial review in Clause 2.
Perhaps I may briefly trace the history of this matter because, in view of the comments made by the noble and learned Lord, Lord Hailsham, I believe it is important. The Commercial Court Committee recommended a new form of judicial review to replace the case stated procedure and of course the other common law right which granted the High Court the jurisdiction to set aside an award of arbitration on the ground of error of fact or law on the face of the award by, and only by, an appellate procedure based upon recent awards. That is Clause 1 of the Bill. The Commercial Court Committee recommended that parties to special category disputes—those are the ones under discussion; namely, Admiralty, Commodity and Insurance—should not be entitled to contract out of this judicial review on the grounds—and I am quoting from paragraph 48 of the report—that:
"there is no evidence of any very widespread desire to be able to contract out [and that the entrenched right to judicial review for the parties to these disputes is very important to the maintenance of English law as the first choice of law in international commerce."
The second, and if I may say so, wholly admirable form of judicial review is the reference procedure which is in Clause 2 of the Bill. This was introduced by the drafters of the Bill and I am certain that the noble and learned Lord, Lord Diplock, at the Second Reading, when he referred to the maintenance in this Bill of the case stated procedure, had this clause in mind because it is a modified and swifter and, if I may say so, a much more efficient form to enable, during the course of arbitration proceedings, reference to be made to the courts so that the arbitrator may be assisted when matters of difficulty on law come before him. The result therefore now is that there are now two points of access between English courts

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and arbitrations in England from which the development of English law can continue to feed.
The difficulty is that there is strong opposition to the full judicial review. First, as has already been said in this debate, it comes from the shipping and commercial circles, but there is also strong opposition from the advisers to the so-called supranational contracts. They base their concern upon two grounds. First, they say that the definitions of the special category disputes are too broad. I shall read only very briefly because I have already read several extracts from letters that I have received, but I think it would be helpful. I read from another section of the letter that was sent to me by the General Council of the American Arbitration Association. It reads as follows:
"The first item concerns the three categories of contracts, Admiralty, Insurance or Commodity, to which foreign parties are not permitted to opt out of the new appeal and reference procedures at the time of contracting. This approach appears to add an unnecessary burden to major trading arrangements which, according to the Lord Chancellor quoting from Hansard, form a very large portion of the disputes arbitrated in London, England, each year."
Then he refers to the column in Hansard and the Hansard debate of 12th December, which was the Second Reading.
"The Lord Chancellor said it well when he indicated that the parties should be free to enter into exclusive agreements at the time of negotiating the contract, not only after disputes have arisen. It may be difficult to tell in which category the contracts fall into the three stated classes of exceptions. Take the case, for example, where a Romanian manufacturer of shoes ships them by a foreign vessel to an American purchaser and the shipment is insured and the contract calls for arbitration in London. Is it clear that the parties may avoid the case stated procedure"—
and again he is referring to the appellate procedures—
"by so indicating in their contract or may the Bill's language cause unnecessary litigation over the question of whether the section applies because there may be elements of insurance or Admiralty involved?"
I shall only cite from another letter a reflection of one strongly expressed view from the senior partner, Mr. Robert Clare, of the New York law firm of Shearman and Sterling, which has immense experience in these large supranational contracts. This is what Mr. Robert Clare said in his letter to me:
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"I recognise that the elimination of Admiralty, Insurance and Commodity contracts must be a compromise because logically it cannot be justified. Certainly, the parties to these contracts are every bit as sophisticated as the parties to a pipeline construction contract which could be made subject to the Arbitration Act."
However, the most telling example that I can give your Lordships comes from arbitration proceedings of which the writer of another letter had special experience. This is what he says in reference to Clause 3(6) of the Bill:
"The proposed exclusion of the three special cases in Clause 3(6) might be more finely tuned. As an example of what I mean, I have just settled a very substantial arbitration that would have been held in London under ICC rules between an Asian seller and an American purchaser of sugar under a long-term supply contract. Although sugar is a commodity, regularly dealt with on a commodity market or exchange in England or Wales, this contract had no connection to such a market or exchange and made no reference to any English contractual form. It would seem that either the Bill itself or the order of the Secretary of State contemplated in Clause 3(8) should more narrowly define commodities contracts, as well as Admiralty or Insurance contracts, to encompass only such agreements as have a rational connection with the English forum. Otherwise the definition of 'special cases' in Clause 3(6) will sweep with too broad a brush."
That expresses the concern of those advising in supranational contracts on the grounds that the terms of subsection (6) are too broad.
There is another problem and that is the problem of related contracts. Here is an example which I can quote:
"A United States contractor in Saudi Arabia has a contract with a Saudi Royal Commission for the construction of a town and this contract has an arbitration agreement in it which contains an exclusion agreement. That contractor will in turn with his sub-contractors attempt to get backup agreements with each of the subcontractors".
Then it sets out in further detail how on major projects these large contracts are related to one another, and indeed one can have and often does have a large group of them. If, as part of this group of contracts, there are contracts that fall into the definition of commodity, admiralty or insurance, then difficulties, as I am sure your Lordships will find it plain to see, are bound to arise because of the different treatment which is proposed under this Bill for these separate but related contracts.
On the other hand, the reference procedure in Clause 2 has, in comments to me, been widely welcomed. The

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view that has been expressed to me time and time again is how extremely helpful and useful it will be for parties to have an easy reference to the courts when, during the course of the reference, they or the arbitrator run into difficulties in the construction of a clause. So in these Amendments I am asking your Lordships to recognise the difficulties and to recognise that they can be narrowed and in the main resolved by use only of Clause 2, the reference procedure, and not the full appellate procedure. The fact of the matter is that it is going to be difficult, if not impossible in terms of definition, to resolve the definition problems on these contracts. I share with the noble and learned Lord, Lord Diplock, and others, abiding concern that we should find compromise, so that we can send this Bill to the other place when we are all agreed and when we are satisfied that the major worries of the customers have been met. It would be a tragedy if this Bill was lost because it was subject to excessive lobbying in the Commons. I beg to move.
The LORD CHANCELLOR: My Lords, I do not know what the concept of excessive lobbying is but I have no doubt the lobbying will go on. I repeat the plea that has been made earlier that in the light of the fact that the compromise that is contained in the Bill in regard to the treatment of special category disputes is one which the Commercial Court Committee came to after much consideration of this matter. Quite frankly, I do feel that if we now make substantial changes in the compromise there is a real risk that the thing will be shipwrecked. I think it is common ground that, despite the criticisms that have been made of Clause 3(6), the Bill as it stands will be of great value.
I hope, accordingly, that those who are concerned will be reassured by the provision in the Bill that the Secretary of State has power by order to remove the restrictions on the right of parties to special category disputes to exclude the courts' jurisdiction. The process of making the change by order could, therefore, be a speedy one. Whether it would be desirable to introduce and approve such an order could be judged fairly soon in the light of experience gained after the Bill has been implemented. So I hope that
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not too tragic a view will be taken by those who criticise this provision, and I do appeal to noble Lords to let the matter proceed as it stands in the Bill.
Lord LLOYD of KILGERRAN: My Lords, I was intending to support the noble Lord, Lord Hacking, in trying to reach a compromise on this very difficult question of definition, but in view of the earnest appeal made from the Woolsack now I do not propose to press this matter any further at this stage.
Lord HACKING: My Lords, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 24 to 26 not moved.]
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendment No. 27:
Page 5, line 4, leave out ("either House") and insert ("both Houses").
The noble Lord said: My Lords, I beg to move this Amendment, very briefly. It is a probing Amendment. Is it politically or constitutionally expedient that at this time the annulment should be made by passing through both Houses rather than "either House", in regard to the Statutory Instrument introduced by the Secretary of State. I beg to move.
The LORD CHANCELLOR: My Lords, in my submission, this Amendment makes an unjustified departure from the normal provisions for parliamentary supervision, requiring both Houses to approve the Secretary of State's order. I have commended the provision in the Bill as a useful one so that in the event of experience showing that an order of that kind should be introduced it could be done pretty quickly. I do submit that to make this a requirement of both Houses having to approve would be an unnecessary obstruction to what might need to be done speedily.
Lord LLOYD of KILGERRAN: My Lords, in those circumstances, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 28:
Page 5, line 4, at end insert—

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(" (10) In this section "exclusion agreement" has the same meaning as in section (Exclusion agreements affecting rights under sections 1 and 2) above.")
The noble and learned Lord said: My Lords, we have dealt with this Amendment already. It has been spoken to and approved. I beg to move.
On Question, Amendment agreed to.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 29:
That Clause 3 be divided into 2 clauses the first consisting of subsections (1) to (5A) (Exclusion agreements affecting rights under sections 1 and 2) and the second consisting of subsections (6) to (10) (Exclusion agreements not to apply in certain cases unless entered into after commencement of arbitration).
The noble and learned Lord said: My Lords, this Amendment was discussed at the same time. I beg to move.
On Question, Amendment agreed to.
Lord HACKING Lord HACKING had given Notice of his mention to move Amendments Nos. 30 and 31:
After Clause 3, to insert the following new clause:
Amendment of s. 1(4) of Arbitration Act 1975
(" . In subsection 1(4) of the Arbitration Act 1975 after "is a party" there shall be added the words "to the proceedings".")
After Clause 3, to insert the following new clause:
Amendment of s. 1(4) of Arbitration Act 1975
(" . After subsection 1(4) of the Arbitration Act 1975 there shall be added the words "or was a party to the arbitration agreement at the time the agreement was made".")
The noble Lord said: My Lords, we have discussed Amendments Nos. 30 and 31 and the noble and learned Lord has been kind enough to say that he will give the matter further consideration. In those circumstances I do not move these two Amendments.
[Amendments Nos. 30 and 31 not moved.]
Clause 5 [Minor amendments relating to awards and appointment of arbitrators and umpires]:
8.38 p.m.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 32:
Page 5, line 40, at beginning insert—
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(" (1) In subsection (1) of section 8 of the principal Act (agreements where reference is to two arbitrators deemed to include provision that the arbitrators shall appoint an umpire immediately after their own appointment)—

(a) for the words "shall appoint an umpire immediately there shall be substituted the words" may appoint an umpire at any time"; and

(b) at the end there shall be added the words "and shall do so forthwith if they cannot agree".")

The noble and learned Lord said: My Lords, with this Amendment it is convenient to consider Amendment No. 33, which is proposed by my noble friend Lord Lloyd of Kilgerran. Both these Amendments are intended to ensure that an umpire is not appointed where the arbitrators agree on their award. We went over this ground earlier. As was pointed out during the Committee stage, when two arbitrators are appointed by the parties, Section 8(1) of the Arbitration Act 1950 imposes a duty on the arbitrators to appoint an umpire immediately. Discharge of their duty often results in wasted time and fees. Where the arbitrators eventually agree on an award obviously the umpire is never required to act. The Amendment of the noble Lord, Lord Lloyd of Kilgerran, is, I am advised, technically defective and its purpose is achieved by the Government Amendment which would give the arbitrators a discretion to appoint an umpire at any time but would impose the duty on them to do so where they disagreed. I hope the noble Lord, Lord Lloyd of Kilgerran, thinks that that effectively meets his point.
Lord LLOYD of KILGERRAN: My Lords, I am very grateful to the noble and learned Lord, the Lord Chancellor, for moving Amendment No. 32, which goes a long way towards meeting the point which I raised during the Committee stage and which, of course, had the support of the noble and learned Lord, Lord Denning. I am much obliged to the noble and learned Lord.
On Question, Amendment agreed to.
[Amendment No. 33 not moved.]
Lord HACKING Lord HACKING moved Amendment No. 34.
After Clause 3, to insert the following new clause:
Amendment of section 25 of the principal Act
(" . In section 25 of the principal Act leave out subsections (1) and (2) and insert—
"(1) Where an arbitrator or an umpire is or are removed by the High Court or where the authority of an arbitrator or umpire is revoked by leave of the High Court, any party to the reference may serve on the other parties to the reference, a written notice to appoint, or, as the case may be, to concur in appointing, an arbitrator or umpire in place of the arbitrator or umpire so removed, and if the appointment is not made within seven clear days after the service of the notice, the High Court or a Judge thereof may, on application by the party who gave the notice, appoint an arbitrator or umpire who shall have the like powers to act within the reference and make an award as had the arbitrator or umpire who has been removed or whose authority has been revoked.".")
The noble Lord said: My Lords, I beg to move Amendment No. 34. I can be brief about this matter. In Section 25 of the Arbitration Act 1950, which concerns the replacement powers granted to the court when an arbitrator or umpire is removed or the authorities revoked, there are certain extensive powers, including the power to replace a body of arbitrators by a single arbitrator and the power to order that an arbitration agreement shall cease to have effect. Those are much more extensive powers than the court reserves unto itself in other sections of the Arbitration Act.
I draw your Lordships' attention to Section 9 of the Arbitration Act 1950, as amended in Clause 5(3) of the Bill, and to Section 10 of the Arbitration Act 1950. This Amendment simply seeks to remove those more extensive powers of interference (in particular, the power in the court to order that the arbitration agreement shall cease to have effect) and brings the powers of the court directly into line with those two sections to which I have referred your
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Lordships—namely, Section 9 of the Arbitration Act, as now proposed to be amended under the Bill, and Section 10 of the Arbitration Act 1950 as it now exists. I beg to move.
The LORD CHANCELLOR: My Lords, the effect of the Amendment would be to repeal Sections 25(1) and (2) of the Arbitration Act 1950 and insert in their place the new clause that is set out on the Order Paper. As I understand it, the effect would be that the High Court would no longer have power, on the application of a party to the arbitration agreement, to appoint an arbitrator or umpire in place of the person or persons removed by the court, until a party had served on the other parties a written notice to appoint the arbitrator or umpire, and the appointment was not made within seven days.
I am advised that little would be achieved by this Amendment, and in any case it seems logical that where the court has removed an arbitrator or umpire then the court should have an unfettered power, on the application of a party to the arbitration agreement, to appoint a person to act as arbitrator or umpire in place of the person or persons removed by the court. My advice is that the Amendment would achieve no helpful purpose.
Lord HACKING: My Lords, the hour is late. I have heard the reply of the noble and learned Lord and I am quite happy to rest upon his reply and to withdraw the Amendment.
Amendment, by leave, withdrawn.

  SCHEDULE E TAX: FEES AND EXPENSES RELIEF
  SCHEDULE E TAX: FEES AND EXPENSES RELIEF
  WAGES COUNCILS: WAGE INCREASE AWARDS
  WAGES COUNCILS: WAGE INCREASE AWARDS
  EARLS COURT EXHIBITION CENTRE: PICKETING
  EARLS COURT EXHIBITION CENTRE: PICKETING