Sitting of 21 June 1979

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS

  WEST MIDLANDS CONTY COUNCIL BILL [Lords] (By Order)
  Order for consideration, as amended, read.
  To be considered upon Thursday next at Seven o'clock.

  BRITISH RAILWAYS (No. 2) BILL (By Order)
  Order for Second Reading read.
  To be read a Second time upon Tuesday next at Seven o'clock.

  EAST KILBRIDE DISTRICT CONCIL BILL (By Order)
  Orders for Second Reading read.
  To be read a Second time upon Thursday next.

ORAL ANSWERS TO QUESTIONS
  NATIONAL FINANCE

    Inflation
    Mr. Greville Jannerasked the Chancellor of the Exchequer what is his estimate of the likely rate of inflation for the next six months.
    Mr. Winnickasked the Chancellor of the Exchequer what is the estimated annual rate of inflation from May 1979 to the following May.
    The Chancellor of the Exchequer (Sir Geoffrey Howe): I expect the annual rate of inflation to increase to above 17½ per cent. by the year end before falling to about 13½ per cent. by the third quarter of 1980.
    Mr. Janner: Is it not right that, when coming to any such estimate, one must allow for a margin of error of at least 2 per cent., so that it is quite possible that inflation by the end of this year will reach 20 per cent?
    Sir G. Howe: There are always margins of error in any forecasts, but the hon. and learned Gentleman would be ill advised to make his presumption in that direction in this case. The House must recognise that the kind of change I have described in my expectation is the kind of change which would have followed from a Budget introduced by the right hon. Member for Leeds, East (Mr. Healey).
    Mr. Winnick: Is it not clear that over the next 12 months the rate of inflation will be well above 20 per cent? What possible moral authority have the Government to ask for restraint from working people when the Budget has well rewarded the rich and the privileged, and all forms of price restraint have been abolished by the Government?
    Sir G. Howe: The hon. Gentleman should not continue enthusiastically to expect and hope for and, indeed, encourage the worst expectations. He should recognise, as most people in the country do, that the Budget produces very substantial reductions in direct taxation for taxpayers at every level, that it releases

    1475
    1,300,000 people from the obligation to pay tax, and that for those dependent on social benefits it produces very substantial increases—the largest in money and real terms ever given.
    Mr. Bruce-Gardyne: Does not my right hon. and learned Friend agree that the rate of inflation this winter will reflect to a considerable extent the rate of growth in the money supply 18 months previously and changes in the exchange rate up to six months previously? If that is the case, does it not follow that the figures in the Red Book are really worth very little more than the estimates of Old Moore's Almanack, a cheap production of private enterprise? In those circumstances, what in God's name is the point of publishing it?
    Sir G. Howe: My hon. Friend is right to draw attention to the impact of the money supply on the likely outlook for inflation. It is right to underline the qualification plainly set out in the Red Book about the very wide margin of error contained in that document.
    Mr. Alfred Morris: Even before this further shocking increase in inflation, is the right hon. and learned Gentleman aware that already there have been some tragic victims of his increases in value added tax and the minimum lending rate? Is he aware that Motability, the organisation which exists to help disabled people have cars, has now ceased to trade? Is this not disgraceful and scandalous? What does he intend to do to save an enterprise of which the Prime Minister herself is a patron?
    Sir G. Howe: The right hon. Gentleman must understand that the prospect for inflation in the light of what was happening to the money supply and the control of the money supply when this Government came into office was set on a bad course anyway. We inherited a very substantial difficulty. The House knows that Motability was supported by my right hon. Friend the Prime Minister and, indeed, by right hon. and hon. Members on both sides of the House. Certainly, the hazards referred to by the right hon. Gentleman are under examination, and we want to examine the prospects as sympathetically as we can.
    Mr. Latham: Will my right hon. and learned Friend confirm that in
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    August 1975, after 16 months of Labour Government, the inflation rate was 26·9 per cent.? Why should any housewife listen to grumbles from the Labour Party in this matter?
    Sir G. Howe: My hon. Friend is entirely right to underline the disastrous record of the last Administration. I remind the House yet again of the extent to which this incoming Government inherited substantial difficulties created by the last Administration.
    Mr. Healey: Does not the right hon. and learned Gentleman agree that he told us himself last Tuesday that his Budget measures—the increases in indirect taxation, the increase in mortgage rate and the increase in rents, rates and public sector charges as a direct result of the Budget—would increase the retail price index by 5 per cent.? Was it not insane, if he believes that inflation is set on a rising course, to produce a Budget of this nature to finance tax cuts which benefit mainly the better off?
    Sir G. Howe: The right hon. Gentleman protests too much and protests in vain. He knows that the direct effects of the Budget did not produce price changes on anything like that scale. More important, he knows that if he was to achieve his own target for the public sector borrowing requirement he would have had to introduce increases in indirect taxation and increases in nationalised industry prices that would have produced at least equivalent increases in prices without any offsetting advantage in the form of lower taxes.
    Mr. Rookerasked the Chancellor of the Exchequer what is the latest rate of inflation as measured by the retail price index.
    Mr. Neubertasked the Chancellor of the Exchequer what is the latest annual rate of inflation.
    Mr. Knoxasked the Chancellor of the Exchequer what is the annual rate of inflation.
    Sir Geoffrey Howe: The retail price index rose by 10·3 per cent. over the 12 months to May 1979.
    Mr. Rooker: Does the Chancellor realise that if the increase continues, as forecast, to 17 per cent. or 18 per cent., the cost of indexing personal allowances, when he comes to draw up his Budget next April, will be more than £2 billion, which exactly matches the extra VAT, or will he adopt, as an excuse, the fact that the Government raised personal allowances more than required this year and use the Lawson part of the Rooker-Wise amendment to get out of their obligations, so imposing a worse burden on working people?
    Sir G. Howe: The hon. Gentleman should not make the worst assumptions about the way in which the rate is likely to move. The rest of the Government's policies are designed to secure a reduction in the rate of inflation. I have already indicated the expectation that one can have for a year beyond that. The success of that policy in securing a reduction in inflation, together with a sensible outcome in terms of employment, depends to a considerable extent on the way in which people are prepared to bargain pay responsibly during the year which lies ahead.
    Mr. Neubert: While I commend my right hon. and learned Friend for his evident intention not to be deterred from taking the right decisions for the economy by the prospect of a rise in the RPI, may I point out that there remains a serious problem of presentation to the public? Will he consider publishing, in addition to the cost of living index, a standard of living index which would, for example, present the increases in VAT in the perspective of reductions of tax at all levels?
    Sir G. Howe: My hon. Friend's point is of course important. It is important for people to understand the offsetting effect of the substantial reductions in personal taxation and the extent to which the change in the retail price index is a change once for all, while those income tax cuts are taking place. We shall give consideration—indeed, we are already doing so—to the suggestion my hon. Friend makes.
    Mr. Knox: Does my right hon. and learned Friend agree that the figure that he has given shows how false were the
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    claims made in the election campaign by the Labour Party that the then Government had inflation under control? By how much does he expect prices to rise in the next 12 months as a direct consequence of the policies of the former Chancellor of the Exchequer?
    Sir G. Howe: My hon. Friend is right to remind the House of that. The former Chancellor had forecast that price inflation could be rising by 13 per cent. now as a result of what had happened so far, and that that could be increased by changes in the price of oil. As I have already said, the plans which would inevitably have been contained in the Budget which, to his relief no doubt, the right hon. Gentleman never had to introduce would have involved an increase in the RPI at least comparable to that which I announced last week.
    Mr. Healey: The right hon. and learned Gentleman really cannot get away with that. The fact is that he will spend £2,000 million in the coming year in cutting the standard rate of tax and giving £600 million worth of relief to those on the higher rates. It is because he has to finance that £10,000 million—[HON. MEMBERS: "Ask a question."] Is it not the case that this is the reason why he is increasing the RPI at a stroke by 5 per cent. in his Budget?
    Sir G. Howe: The right hon. Gentleman, characteristically, underlines the folly of his own position. The reality about the Budget that he would have had to introduce is that he would have been making increases in indirect taxation to produce these increases in the RPI, without any reductions in the burden of income tax corresponding to those that I have made. The greater part of the reductions go in the improvement of thresholds and the reduction of the basic rate.
    Mr. Hordern: Since the most important part of the Financial Statement is that dealing with economic forecasts, and since the forecasts say that past errors should not be treated as a guide for future errors, what is the purpose of publishing these inflation forecasts anyway?
    Sir G. Howe: My hon. Friend will recollect that there is a legal obligation to publish the document and those forecasts

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    in this way. However, I agree with him that the increasing experience about the margin of error of forecasts of that kind casts some doubt on the value of making them.
    Mr. Ashley: Since the poor suffer most from inflation, has the right hon. and learned Gentleman's attention been drawn to the statement of the chairman of the Supplementary Benefits Commission, in which he said that people living in poverty will have their standards reduced unless £200 million is found for them? Will he comment on that statement please?
    Sir G. Howe: It is for my right hon. Friend the Secretary of State for Social Services to comment on that specific matter, but I remind the right hon. Member that, as a result of the changes announced last week, benefits are being increased by substantial sums and a large number of the poorer lower paid are being taken out of the tax system altogether. No doubt my right hon. Friend will give further consideration in due course to the report produced by the SBC.

    National Debt
    Mr. David Priceasked the Chancellor of the Exchequer what was the increase in the National Debt between April 1974 and April 1979; and what is the annual cost of servicing that debt.
    The Chief Secretary to the Treasury (Mr. John Biffen): Between 31 March 1974 and 31 March 1979, the outstanding National Debt increased by some £46,526 million. The cost of servicing the outstanding National Debt in the last financial year, 1978–79, was £6,458 million. For the current year, 1979–80, the cost is estimated to be £8,150 million.
    Mr. Price: Would my right hon. Friend care to indicate what the servicing of that enormous debt means in terms of taxation? Does he not agree that it comes to more than the whole of the cost of income tax and the consequential tax which might be called the Healey head tax and must be ranked along with scutage, Morton's fork, ship money and the window tax as some of the more outrageous impositions placed by bad or evil British Governments upon the people of this benighted country?
    Mr. Biffen: If I may be a little more prosaic in answer to my hon. Friend, it is true that the servicing figure of £8,150 million exceeds what is now spent on health and nearly matches what is spent on education.
    Mr. Cormack: If it had not been for the financial incontinence of the previous Chancellor, by how much could VAT have been reduced?
    Mr. Biffen: That depends upon the incontinence.
    Mr. Robert Sheldon: Given that the cost of servicing the debt is so high, is it not true that the 14 per cent. minimum lending rate will not reduce the cost of servicing that debt? Will the Chief Secretary comment on views held in financial circles in this country and elsewhere that the 14 per cent. minimum lending rate is not likely to be the rate for a few weeks but could be the rate for a few months or even longer?
    Mr. Biffen: As the right hon. Gentleman knows, no one from this Dispatch Box will postulate when expected changes shall take place in minimum lending rate. He should also know that a 14 per cent. minimum lending rate was a necessity arising from our poisoned inheritance from the previous Administration.

    Mileage Allowances (Health Service Workers)
    Mr. Hal Millerasked the Chancellor of the Exchequer whether he will review the present arrangements under which nurses, health visitors, midwives, radiographers and others are assessed for tax on their mileage allowances which are reimbursement for expenses incurred in carrying out their duties; and if he will make a statement.
    The Financial Secretary to the Treasury (Mr. Nigel Lawson): Nurses, health visitors, midwives and radiographers, like all other employees, are assessed to tax on their mileage allowances only to the extent that these exceed the reimbursement of expenses necessarily incurred in the performance of their duties. I see no reason to review the arrangements recently entered into between the Inland Revenue and the National Health Service as to the tax treatment of these allowances.
    Mr. Miller: Will my hon. Friend reflect on the widespread resentment of those working in the Health Service that their mileage allowances, particularly when they are called out at night, should be taxed? Would it not be more sensible to arrange that the mileage allowance should cover expenses? How did the mileage allowance come to include a profit element that the Inland Revenue thought fit to tax? How can that be substantiated, in view of the recent increases in motoring costs?
    Mr. Lawson: As I explained in my original answer, there is no special discrimination against health workers. The law applies equally to all workers. The agreement between the Inland Revenue and the National Health Service was that a taxable surplus would normally arise only when fewer than 3,000 miles were travelled. Round figures are negotiated for tax liability in those circumstances. This is meant to assist the workers concerned. If they think that it is wrong and that they would benefit from individual arrangements, they can contest the agreement.
    Mr. Michael Morris: Does the Minister accept that members of the Health Service, especially those who go out in the middle of the night, have made a substantial protest over the last year to 18 months since the change was made? Will he have conversations with National Health Service representatives to see if a more satisfactory arrangement can be made?
    Mr. Lawson: This is a very complicated question. Taxation of the emergency call-out payment is separate from the taxation of car allowances. The expenses of travelling from home to work, whether in normal hours or during an emergency call-out, do not normally qualify for tax relief because they are regarded as being incurred to put the employee in a position to perform his duties rather than in their performance. In an emergency, to which my hon. Friend refers, when an employee has actually embarked on his duties before starting his journey to work and is then travelling in the performance of those duties, he is entitled to relief for those expenses. A simplified procedure has been negotiated to which I have referred.
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    I hope that my hon. Friend is now fully satisfied.

    National Savings Certificates
    Mr. Michael Spicerasked the Chancellor of the Exchequer whether the Government will reimburse individuals for interest charges incurred as a result of their having to take out loans whilst unable to cash national savings certificates because of industrial action.
    Mr. Lawson: I have already made clear that we will honour the commitment of the previous Government to recompense those affected by the industrial action by computer staff at the Department for National Savings. This, of course, includes holders of national savings certificates who may have had to borrow because they were unable to encash the certificates during the strike. The precise terms on which the recompense is to be offered and the necessary administrative arrangements are still under consideration, but I hope to be able to make an announcement soon.
    Mr. Spicer: I welcome that reply so far as it goes, but will the Financial Secretary give an assurance that this matter will be treated with the utmost urgency? A lot of people are affected.
    Mr. Lawson: I agree entirely with my hon. Friend: I treat this as a serious matter. It is being dealt with with the utmost urgency. The question is extremely complicated, and I hope very much that I shall be able to make an announcement soon. It is important to get it right and to see that justice is done.

    Tax yields
    Mr. Meacherasked the Chancellor of the Exchequer what are the latest figures for the yield of corporation tax and income tax, respectively.
    Mr. Lawson: Receipts in 1978–79 were—corporation tax, £3,938 million; income tax, £18,776 million. The estimates for 1979–80, after the Budget changes, are £4,850 million and £19,655 million, respectively.
    Mr. Meacher: How can it be right for the average low-paid worker to have to pay about 15 per cent. of his gross income in income tax while in the last company accounting year BP paid literally

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    nil corporation tax out of profits of £1,800 million and 11 others of the top 20 companies also paid nil corporation tax? What is the hon. Gentleman doing to rectify that massive under-taxation of top companies?
    Mr. Lawson: The average rate of tax over trading profits is 24 per cent. for companies as a whole—not nil. However, the hon. Gentleman should realise that the economy would be a great deal healthier and that the living standards of the poor, about whom he professes such concern, would be a great deal better if British companies made bigger profits—if they were more profitable rather than less.
    Mr. David Price: Does not my hon. Friend agree that the figures that he has just given prove my point that, if it were not for the "Healey head tax", the Chancellor would have been able to reduce income tax to 16p in the pound and not only to 30p?
    Mr. Lawson: I congratulate my hon. Friend on having been called a second time so soon. Once again, he has made a good point.
    Mr. Richard Wainwright: Bearing in mind the low and declining rate of growth bequeathed by the previous Government, and the measures in the Budget, when does the Financial Secretary expect the rate for corporation tax to be positively buoyant?
    Mr. Lawson: I am not in the business of giving forecasts, but it is certainly our hope that there will be a recovery in corporate profits. I am glad to have the support of the Liberal Party to this end, even if not of the main Opposition party.
    Mr. Denzil Davies: The hon. Gentleman says that he is not in the business of giving forecasts. Will he confirm that the 9 per cent. figure for money supply in the Red Book is a target and not just one of the vague forecasts that he seems to like to put in the rest of the Red Book?
    Mr. Lawson: I am glad that the right hon. Gentleman raised that. Indeed it is a firm target, and we shall attempt to hit that target.
    Mr. Cormack: Can my hon. Friend arrange for every taxpayer to be informed
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    that a third of his income tax is spent on servicing the debt incurred by the last Government?
    Mr. Lawson: My hon. Friend is absolutely right that the last Government succeeded in an event unparalleled in history—getting at the same time a massive depreciation of the currency and an increase in real terms in the National Debt. I do not think that that double had ever been achieved before.
    Mr. George Robertsonasked the Chancellor of the Exchequer what was the total revenue in each of the last four fiscal years from (a) capital gains tax, (b) capital transfer tax, and (c) estate duty, respectively.
    Mr. Lawson: Since the answer contains a number of figures, I hope that the hon. Gentleman will forgive me if, with permission, I circulate it in the Official Report.
    Mr. Robertson: Since I have a good idea that the figures will show that we in this country are still raising a smaller proportion of the total tax take from taxes on capital than is done even in the very un-Socialist United States, will the Treasury consider increasing the amount taken in taxes on capital and reducing taxes on expenditure among the weakest and poorest in the community?
    Mr. Lawson: If the hon. Gentleman had already had the figures, I should have been surprised at his asking that question. What he fails to recognise is that capital taxation in this country at the present level, which is very high by international comparisons, is having a damaging effect on enterprise and initiative, and particularly on small businesses, agriculture and our national heritage. This is not, of course, reflected in the absolute figures at present, but we see it reflected in the yield of capital taxes at the end of the day, and the truth is that, because of the transitional arrangements, the full yield of capital transfer tax has not yet been felt. This is why we intend to introduce relieving measures.
    Following are the figures:

    £ million

    1975–76

    (a) Capital gains tax

    386·7

    (b) Capital transfer tax

    117·6

    (c) Estate duty

    212·3

    1485

    1976–77

    (a) Capital gains tax

    323·4

    (b) Capital transfer tax

    259·2

    (c) Estate duty

    124·4

    1977–78

    (a) Capital gains tax

    339·9

    (b) Capital transfer tax

    331·2

    (c) Estate duty

    86·4

    1978–79

    (a) Capital gains tax

    352·9

    (b) Capital transfer tax

    323·2

    (c) Estate duty

    46·1

    Money Supply
    Mr. Bruce-Gardyneasked the Chancellor of the Exchequer what was the annualised rate of growth in the money supply, according to the M1 and M3 definitions respectively, in the latest period of three months for which the figures are available; and whether this was in accord with the monetary policy of Her Majesty's Government.
    Mr. Lawson: In the three months to mid-May, M1 grew at an annual rate of 12·9 per cent. and £M3 grew at an annual rate of 7·9 per cent. However, in the last six months £M3 had grown at an annual rate of nearly 14 per cent., which was above the upper end of the target range of the previous Government, and there were signs that the rate of growth was increasing. My right hon. and learned Friend accordingly raised MLR to 14 per cent. in order to help bring the rate of growth of £M3 into line with the new target range which has already been referred to of an annual rate of 7 per cent. 11 per cent. for the next 10 months.
    Mr. Bruce-Gardyne: Is it not painfully apparent that the reins of monetary control had slipped from the palsied hands of the right hon. Member for Leeds, East (Mr. Healey)? May I congratulate my right hon. and hon. Friends on vigorously recovering them? Can my hon. Friend assure the House that his right hon. and learned Friend will not be dissuaded by any recidivist neo-Keynesians in Great George Street from his professed intention of publishing rather longer-term objectives for money supply, going on into the next financial year?
    Mr. Lawson: I am sure that my right hon. and learned Friend is well able to look after himself when it comes to dealing with recidivist neo-Keynesians or any
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    one else. The issue of publishing longer-term monetary forecasts raises complicated matters. This point is under review and the idea has not been ruled out.
    Mr. Denzil Davies: Since it has been suggested that there has been a certain amount of double counting in the PSBR forecasts and since we have been told that the money supply is now running at 14 per cent., may I ask whether the hon. Gentleman is satisfied that interest rates will not have to go higher to bring the money supply down to the target of 9 per cent. announced by the Chancellor?
    Mr. Lawson: My right hon. and learned Friend has pointed out already the unwisdom of making forecasts of the interest rates. The previous Chancellor did this and was proved wrong time after time. We do not intend that to happen. If the right hon. Gentleman is worried about the public sector borrowing requirement and possible double counting—I assure him that there is none—let him look at the public sector financial deficit. He will find there that, as a proportion of GDP, it is projected this year to be at its lowest level for seven years—lower than at any time under the previous Administration.
    Mr. Healey: Is the hon. Gentleman rebuking the Governor of the Bank of England for suggesting in his speech to the Leasing Association two days ago that MLR will have to stay at 14 per cent. throughout the summer?
    Mr. Lawson: No. I was making no comment on the Governor of the Bank of England whatsoever.

    Public Sector Borrowing Requirement
    Mr. Jim Marshallasked the Chancellor of the Exchequer what is the latest estimate for the public sector borrowing requirement.
    Mr. Cryerasked the Chancellor of the Exchequer what is his forecast of the public sector borrowing requirement for 1979–80.
    Mr. Biffen: I refer the hon. Members to my right hon. and learned Friend's Budget Statement.
    Mr. Marshall: Will the right hon. Gentleman refer to the article written by

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    his hon. Friend the Financial Secretary headed:
    "The Economic Perils of Thinking for the Moment"
    in which I presume the economic policies of the Government are outlined? Is he aware that one of the basic aims put forward in that article is the introduction of a long-term stabilisation programme to defeat inflation and increase public confidence? Can he outline to the House and the country how that proposed scenario fits in with rip-roaring inflation, increasing unemployment, an increasing balance of payments deficit and zero economic growth?
    Mr. Biffen: I always pay the closest attention to the views of my hon. Friend the Financial Secretary, certainly to his thinking on long-term economic matters. The public sector borrowing requirement is the centrepiece of the Government's economic policy. We attach the greatest importance to its being reduced from 5½ per cent., expressed as the gross domestic product last year, to 4½ per cent. for the gross domestic product for the year in question. We regard that as being a major part of our attack upon inflation.
    Mr. Cryer: Does the right hon. Gentleman agree that there will be much hardship as a result of this attempt to cut the PSBR by a savage attack on public expenditure, upon which the Government are about to embark? Would it not be more meaningful if the Government were determined to tax the big multinational corporations properly and so get their yield of corporation tax nearer to the level of income tax yield, at around £20 billion per annum? Does he not agree further that if cuts in public expenditure are required anywhere, our contribution to the Common Market could be one likely area? Will he also contemplate a savage cut in the amount of money spent on defence, which reaches almost £10 billion?
    Mr. Biffen: We have always made it clear that we understand that there will be severe strain involved in the public expenditure cuts that have been presented to the House, both at the time of the Budget and in the Gracious Speech. There is no disposition on the Government Benches towards heavier corporate taxation. We believe that a revival of profitability in the private sector is essen-
    1488
    tial to national economic regeneration. My right hon. and learned Friend the Chancellor has made the most robust speeches about the necessity of reducing Britain's net contribution to the European Community. To deal with the hon. Gentleman's fourth point, we have made it clear, and we are happy to stand by our declaration, that we believe that this country's defences need restoring rather than further undermining.
    Mr. Speaker: Order. I hope that Ministers will not feel obliged to answer four supplementary questions in future, because they should not be asked in the first place. One supplementary question is the custom in the House, and it is unfair to other hon. Members for an hon. Member to push in questions which amount to his making a speech.
    Mr. Emery: Will my right hon. Friend tell the House what policy the Government have decided upon to control foreign borrowing by nationalised industries? Has any directive been given on this, or do the Government wish to encourage a further amount of that type of borrowing?
    Mr. Biffen: No directive has been issued.
    Mr. Mike Thomas: Is the right hon. Gentleman aware of the impact the cuts in the PSBR will have on the low paid? Is he aware further that, on the strength of answers given to me by the Financial Secretary to the Treasury, the taxpayer with £2,000 taxable a year will be better off by less than 5p a week as a result of the last Budget? Does the right hon. Gentleman realise that when we take into account increases in council rents and in mortgage repayments, such a person will be worse off while his standard of living will be cut as a result of the cuts in public expenditure?
    Mr. Biffen: It is easy to make the assertion that the standard of living of the lower paid is being cut as a result of the public expenditure cuts, but I have seen no evidence to sustain that assertion

    Public Expenditure
    Mr. Canavanasked the Chancellor of the Exchequer whether he will now give details of the Government's policy on public expenditure.
    Mr. Biffen: I refer the hon. Member to my right hon. and learned Friend's Budget Statement.
    Mr. Canavan: What estimate has been made of the effect of the public expenditure cuts on unemployment in view of the reports that the Treasury has secret forecasts of unemployment running at the level of 2 million at the turn of the year, due partly to the savage cutback in public expenditure? Is the Minister afraid to come clean and tell the truth because of the possible social and political repercussions of his Government's disastrous economic policies?
    Mr. Biffen: I simply do not believe that it would be possible to forecast with any degree of precision the increase in unemployment that might arise from the package of spending cuts announced at the time of the Budget.
    Mr. Budgen: Does my right hon. Friend agree with the economic commentary in yesterday's Bank of England Quarterly Review on page 112, where it is said that sales of public assets are to some extent in competition with sales of gilts? Does my right hon. Friend go on to conclude that sales of public assets could not properly be described as a reduction of the public sector borrowing requirement?
    Mr. Biffen: I have not had the benefit of reading the Bank of England Quarterly Review to which my hon. Friend refers, but I would not endorse what is stated there.

    Development Land Tax
    Mr. Lathamasked the Chancellor of the Exchequer whether he will make a statement on his proposals for development land tax.
    Mr. Lawson: As I am sure my hon. Friend was glad to see, my right hon. and learned Friend the Chancellor of the Exchequer did so in his Budget Statement.
    Mr. Latham: Now that many small transactions will be exempt from this tax, will my hon. Friend turn his attention to the gross overstaffing of the development land tax office, on which there was a critical Inland Revenue report to the Labour Government but on which no action has been taken?
    Mr. Lawson: I am well aware of the close interest my hon. Friend has been taking over a long period in the development land tax office. It is too soon to settle the future staffing needs of that office. For one thing, as a result of the removal, by the measures introduced in the Budget, of the major uncertainties that have been hanging over the development land market, I expect that there will be an increase in the number of disposals. We have this matter closely under review.
    Mr. Denzil Davies: Is the hon. Gentleman aware that any benefit—and the Opposition dispute that there will be any—which might come to the building industry as a result of cuts in development land tax will be far outweighed by the damage caused by the Budget, especially the public expenditure cuts and the punitive rates of interest?
    Mr. Lawson: The right hon. Gentleman characteristically seems to assume that the building and construction industry is concerned solely with the public sector. What he fails to appreciate is that, as a result of the Budget measures and the long-term strategy of the Government, we expect over the coming years a revival in the private sector, which will give a lot of business to builders and to the construction industry generally.

    Gross Domestic Product
    Mr. Richard Wainwrightasked the Chancellor of the Exchequer what, at the present time, is the estimated annual rate of growth of gross domestic product.
    Sir Geoffrey Howe: The economic forecast published last week in the Financial Statement and Budget Report suggested that gross domestic product in the first half of 1979 was more than 1 per cent. higher than a year earlier.
    Mr. Wainwright: In view of that only modest improvement, and in order that enterprising people may see some light at the end of the tunnel, will the Chancellor say in what year he aims to see a substantial upturn in the rate of growth of gross domestic product?
    Sir G. Howe: I am grateful to the hon. Gentleman for his emphasis on the need for enterprising people to see some light at the end of the tunnel, since it must be understood plainly that it is beyond the

    1491
    power of any Government, by expansion or contraction of money supply or demand, to guarantee the delivery of any forecasts of output growth at all. What the Government are seeking to do in the Budget is to change the tax environment, to improve incentives for the enterprising, to whom the hon. Gentleman refers, and to examine and remove regulations and obstructions which stand in the way of enterprise. Only when we secure improvements of that kind in the performance of the supply side of the economy is there any real prospect of expansion of output, prosperity and employment.
    Mr. Stoddart: At the Heads of Government meeting now taking place, at which the Prime Minister is in attendance, will the response to the Commission's concern about unemployment and the decline in growth in the EEC countries be to put forward the same ridiculous policies for solving this problem as have been put to the House and the country by this Government?
    Sir G. Howe: It is my plain impression from discussions with Finance Ministers in other countries, and it clearly emerged, for example, at the OECD meeting last week, that throughout the world economy attention is focusing increasingly on the need to improve the supply side of the economy. Indeed, the Secretary for the Treasury in the United States, speaking in London last Wednesday, drew attention to the failure in that economy of persistent reliance on short-term demand management as an answer to economic problems and emphasised exactly the same diagnosis and prescription as I gave in my Budget speech the day before.
    Mr. Robert Sheldon: But is not the Chancellor aware that one of the most serious consequences of his Budget will be in the investment intentions of manufacturing industry? Since the worrying forecasts that we are now hearing about manufacturing industry's investment intentions give cause for great concern, will the right hon. and learned Gentleman give to industry generally at least the modest assurance that he has no intention whatever of reducing the capital allowances?
    Sir G. Howe: The outlook for manufacturing investment depends essentially on the long-term prospect for economic
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    success and prosperity, and depends therefore upon the measures that I announced in the Budget. I made plain also in my Budget Statement that it would be wrong to contemplate any substantial change in the structure of corporate taxation without consultation, and I have no such intention at present.

    Widows (Taxation)
    Mr. Dalyellasked the Chancellor of the Exchequer what examination he is making of the taxation treatment of working widows.
    Mr. Lawson: All widows who are liable to tax will benefit from the very substantial reductions in income tax which my right hon. and learned Friend has proposed in his Budget; but we shall, of course, keep the effects of the tax system on widows under careful review.
    Mr. Dalyell: What does "under careful review" mean to the Financial Secretary?
    Mr. Lawson: It means under careful review.

  WISBECH
  Mr. Freudasked the Prime Minister if she will visit Wisbech.
  The Secretary of State for the Home Department (Mr. William Whitelaw): I have been asked to reply.
  My right hon. Friend has no plans to visit Wisbech.
  Mr. Freud: Is the right hon. Gentleman aware that during the election campaign the Conservative candidate for Isle of Ely distributed tens of thousands of leaflets which stated that the right hon. Lady, now Prime Minister, had reaffirmed
  "her promise to Dr. Stuttaford that a Conservative Government will save the Bowthorpe hospital"?
  If the Prime Minister is unable to come to Wisbech, will she at least announce the date of the ministerial reprieve so that celebrations may begin and staff recruitment recommence?
  Mr. Whitelaw: In fact, my right hon. Friend said that she would like to see the hospital kept open if possible. My hon. Friend the Minister for Health has said

  1493
  that we would want to retain Bowthorpe hospital but only if it were practicable and if matters had not gone too far. He is now considering the case in detail. As for Dr. Stuttaford, whose failure to get back to the House I deeply regret, he can well speak for himself.
  Mr. Brocklebank-Fowler:Will my right hon. Friend take it that many of my constituents were pleased by the sympathy which the Prime Minister showed towards small hospitals and wish her to urge her right hon. Friend the Secretary of State for Social Services to review this decision and to save Bowthorpe hospital, which is a valuable and much-liked local hospital?
  Mr. Whitelaw:I can certainly confirm that my right hon. Friend wishes to keep small local hospitals open, and I assure my hon. Friend that I shall convey his remarks to her.
  Mr. Ennals:I did visit Wisbech during the course of the election campaign as a result of this squalid Tory vote-catching effort. When the right hon. Lady has the opportunity to visit Wisbech, will she give some explanation to the people there why, after an assurance was given that the National Health Service would not suffer from public expenditure cuts, they now find that, as a result of the increase in VAT and the application of cash limits, their Health Service is being threatened with a 3 per cent. cut in revenue expenditure?
  Mr. Whitelaw:I do not accept the right hon. Gentleman's ideas.
  Mr. Eldon Griffiths:Will my right hon. Friend convey to the Prime Minister that the time she gains by not visiting Wisbech or Bowthorpe hospital might be better devoted to dealing with the threat now being made to certain hospitals in East Anglia that the National Union of Public Employees will take industrial action against the policy of this Government, endorsed by the British electorate, that we shall not permit a vendetta to be pursued against pay beds? Will he make clear that it would be wholly wrong and against this country's constitutional proprieties that NUPE should do any such thing?
  Mr. Whitelaw:I entirely agree that any such action, if it were taken, would be highly regrettable.

  TUC AND CBI
  Mr. Mike Thomasasked the Prime Minister when last she met the Trades Union Congress.
  Mr. Whitelaw:I have been asked to reply.
  My right hon. Friend met the general secretary of the TUC on 31 May. She will be meeting the economic committee next Monday.
  Mr. Thomas:As the Financial Secretary has confirmed the fact to me in parliamentary answers, will the Prime Minister tell the TUC when she next meets it that what she refused to admit to the House on 14 June in reply to me is true—namely, that no taxpayer earning less than £10,000 a year will benefit from the Budget?
  Mr. Whitelaw:I do not accept what the hon. Gentleman says, and I have nothing to add to what my right hon. Friend said previously.
  Mr. Adley:Is my right hon. Friend aware that many trade unionists in my constituency, who are not privy to the meetings between members of Her Majesty's Government and the TUC, are none the less anxious to hear proposals from the Government for the introduction of secret ballots and for some curb on secondary picketing? Will he give an assurance that these measures will be put before the House at the earliest possible moment?
  Mr. Whitelaw:As my hon. Friend knows, they were promised in the Queen's Speech. I assure him that they will be put before the House at the earliest opportunity.
  Mr. Wrigglesworth:When the right hon. Gentleman and members of the Government meet the TUC next time, will they give it further details about the economic forum that is to be established as announced by the Prime Minister on Tuesday? Will the forum be considering the implications of 17½ per cent. price increases and the effect that these will have upon wages? What will it be discussing, and who will be part of it?
  Mr. Whitelaw:Whether there should be a forum and what it should discuss

  1495
  will be among the matters considered at the meeting.
  Mr. McCrindle:When my right hon. Friend the Prime Minister next meets the TUC, will she tell it that, while the Government will be prepared to discuss matters with it, as with any other important body which has a responsibility for the economy, as often as is necessary, it was the Government and the Government alone who on 3 May were returned to run the country?
  Mr. Whitelaw:Yes, of course. As my hon. Friend knows, the electorate, after years of decline under a Labour Administration, voted for a new start and a new opportunity for Britain, and that is what it is getting.
  Mr. Russell Kerr:When does it start?
  Mr. Kilroy-Silk:When the Prime Minister meets the economic committee of the TUC, will she explain to it why she used the Budget to launch an attack upon the sick, the poor, the pensioners and the unemployed?
  Mr. Whitelaw:Considering many of the provisions in the Budget, including large increases for retirement pensioners, I am amazed by the hon. Gentleman's remarks.

  MINISTER FOR LONDON
  Mr. John Huntasked the Prime Minister if she will appoint a Minister for London.
  Mr. Whitelaw:I have been asked to reply.
  No, Sir.
  Mr. Hunt:Modesty precludes me from suggesting any names for the job, but may I ask whether my right hon. Friend agrees that Greater London, which has a population almost as large as Wales and Scotland put together, has especially acute problems in housing, transport and tourism? As London is the capital city, does it not have a special claim for a direct voice at ministerial level?
  Mr. Whitelaw:I recognise the problems of London, but I am bound to say as a Member representing a constituency in the North of England that I have always felt that London speaks with a pretty strong voice already.
  Mr. Christopher Price:Is the right hon. Gentleman aware that London's housing problems are much more acute than those in any other part of the country? Is he aware further that the ability of London local authorities to carry out satisfactory repairs to the housing stock has been made almost impossible by measures in the Budget against local authorities? Is he able to give any comfort to the old and the infirm in my constituency, who under present measures must look forward to another winter with leaking roofs and houses that do not keep out the weather?
  Mr. Whitelaw:It seems that the hon. Gentleman is making a strong condemnation of many of the London boroughs that are under Labour control and of the previous Labour Government.
  Mr. Thomas Cox:Is the right hon. Gentleman aware, whatever political points he is trying to score, that there are real problems existing in London? Will he pay attention to the comments that are being made by those in industry and commerce in London, who are asking for the very things that the hon. Member for Ravensbourne (Mr. Hunt) has been requesting—namely, the allocation of time in the House for the problems and issues of London to be discussed?
  Mr. Whitelaw:The GLC, under Conservative control, is doing an extremely good job. As for discussions in the House, I remind the hon. Gentleman that last week, for example, the House considered giving a Second Reading to the Greater London Council (General Powers) Bill. That provided a perfectly good opportunity to discuss London matters.

  CHANCELLOR OF THE DUCHY OF LANCASTER
  Mr. Dalyellasked the Prime Minister if she will define the duties of the Chancellor of the Duchy of Lancaster.
  Mr. Whitelaw:I have been asked to reply.
  The Chancellor of the Duchy of Lancaster has a personal responsibility to the Queen for the management of the Duchy's estates. He appoints some justices of the peace in the north-west of

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  England. The Chancellor of the Duchy of Lancaster is also Leader of the House and has responsibility for the arts.
  Mr. Dalyell:May I ask the right hon. Gentleman a question of which I gave his office notice in the hope of a considered reply—namely, whether, in the all-party talks, the Chancellor of the Duchy of Lancaster will be putting forward proposals for rules of referendums if we are to have referendums in future?
  Mr. Whitelaw:I am grateful to the hon. Gentleman for his courtesy in giving me notice of what he intended to ask. I hope that my reply will be regarded as a considered one. The proposed talks are intended to deal with the government of Scotland, although they will have to take account of the wider implications of some suggested improvements. It would be inappropriate to include on the agenda rules for referendums, which would obviously have to apply throughout the United Kingdom.
  Mr. Latham:Is my right hon. Friend aware that there has long been strong support in the art world for the attitudes of the Chancellor of the Duchy of Lancaster towards the National Land Fund and the need to reform it? May we have the Cabinet's proposals on the matter as soon as possilbe?
  Mr. Whitelaw:I am grateful to my hon. Friend for what he says about the Chancellor of the Duchy of Lancaster. It will be for my right hon. Friend to bring the matter forward. I have no doubt that he will do so in the near future.
  Mr. Maclennan:In view of the pressure from Government Back Benchers, especially from the hon. Member for Ravensbourne (Mr. Hunt), for a Minister for London, will the right hon. Gentleman include the subject of devolution to England and London on the agenda for the inter-party talks?
  Mr. Whitelaw:I understand that the talks that have been arranged will be to consider the affairs of Scotland.

  PRIME MINISTER (ENGAGEMENTS)
  Mr. Joseph Deanasked the Prime Minister if she will list her public engagements for 21 June.
  Mr. Whitelaw:I have been asked to reply.
  Today my right hon. Friend is attending a meeting of the European Council in Strasbourg.
  Mr. Dean:Will the right hon. Gentleman ask his right hon. Friend the Prime Minister to take time off today to consider the effect of the cuts that the Secretary of State for Education and Science has announced in nursery provision and primary school rebuilding programmes, bearing in mind that my constituency still has to suffer primary schools that are over 100 years old, to ascertain whether there can be any alteration of the savage cuts and the adverse effects that they will have?
  Mr. Whitelaw:I shall ensure that the hon. Gentleman's remarks are conveyed to my right hon. and learned Friend the Secretary of State for Education and Science. My right hon. Friend will carefully consider what he has said.
  Mr. Strang:Will the right hon. Gentleman take the opportunity to deny reports coming from Brussels that his right hon. Friend the Minister of Agriculture, Fisheries and Food is preparing the ground for a sell-out in the current EEC farm price negotiations? Does he agree that the policy of his right hon. Friend the Prime Minister of securing a real reduction in Britain's disproportionate contribution to the EEC budget will be undermined if the Minister of Agriculture, Fisheries and Food does not insist on the previous Labour Government's policy of a complete EEC common farm price freeze?
  Mr. Whitelaw:I do not regard it as possible in any circumstances that my right hon. Friend the Minister of Agriculture, Fisheries and Food will ever be engaged in a sell-out. Obviously my right hon. Friend will make a statement to the House when he returns. I ask the hon. Gentleman to await that statement.
  Mr. Concannon:Bearing in mind the Prime Minister's known sympathy with efforts to try to keep open hospitals, will the right hon. Gentleman draw to her attention the Adjournment debate that took place on Monday evening? As the right hon. Lady cannot go to Wisbech, will she find time to come to Mansfield

  1499
  to help me keep open two or three local hospitals?
  Mr. Whitelaw:My right hon. Friend will not be able to go to Mansfield on Monday.
  Mr. Concannon:Why not?
  Mr. Whitelaw:I understand that she will be making a statement about her visit to Strasbourg. As the House will know, she is leaving the United Kingdom on Tuesday to attend a summit meeting in Tokyo.
  Miss Richardson:Will the right hon. Gentleman ask his right hon. Friend the Prime Minister, when she returns from Strasbourg, to pop into her local launderette with her weekly wash, where she will find that because of VAT being increased to 15 per cent. the cost of using a machine has increased by 10p? Will he ask her to bear in mind that launderettes are used by 2½ million consumers who, generally speaking, are one-parent families and poorer families who cannot afford washing machines?
  Mr. Whitelaw:Without endorsing what the hon. Lady said, I shall certainly ensure that her comments are passed on to my right hon. Friend.
  Mr. Gummer:Does my right hon. Friend agree that the Prime Minister is more likely to get a good deal for Britain in the Common Market because she demonstrated her support of the European Community—more so than her predecessor, who showed himself unwilling to stand up for our place in Europe?
  Mr. Whitelaw:The position of the Government on Europe is widely respected and regarded throughout the European Community.

BUSINESS OF THE HOUSE
Mr. James Callaghan:Will the Leader of the House state the business for next week?
The Chancellor of the Duchy of Lancaster and Leader of the House of Commons (Mr. Norman St. John-Stevas):Yes, Sir. The business for next week will be as follows:
MONDAY 25 JUNE—Debate on the motion on Select Committees related to Government Departments.
Motion on the Industrial Training Levy (Engineering) Order.
TUESDAY 26 JUNE—Motions on the Wales Act 1978 (Repeal) Order and on the Select Committee on Welsh Affairs.
Motion on the Iron Casting Industry (Scientific Research Levy) (Amendment) Order.
At seven o'clock, the Chairman of Ways and Means has named opposed private business for consideration.
WEDNESDAY 27 JUNE—Second Reading of the Finance Bill.
Motions on the Pool Competitions Act 1971 (Continuance) Order and on the Social Security Revaluation of Earnings Factors Order.
THURSDAY 28 JUNE—Motion on the Army, Air Force and Naval Discipline Acts (Continuation) Order.
At seven o'clock, the Chairman of Ways and Means has named opposed private business for consideration.
FRIDAY 29 JUNE—Proceedings on the Pensioners' Payments and Social Security Bill.
Debate on the multilateral trade negotiations, on a motion for the Adjournment.
MONDAY 2 JULY—Motions on the Northern Ireland Act 1974 (Interim Period Extension) Order and on the Northern Ireland (Emergency Provisions) Act 1978 (Continuance) Order.
Mr. Callaghan:I note that Friday's business will be the proceedings on the Pensioners' Payments and Social Security Bill. We have not yet been able to see a copy of the Bill. May I have an assurance from the Leader of the House that

1501
it will be concerned only with the increase in pensions and not with the miserable proposal to take away the right to increase them by reference to earnings increases as opposed to price increases?
Mr. St. John-Stevas:Although dissenting from the right hon. Gentleman's adjective, I give that assurance.
Mr. Peter Bottomley:Do I understand that the debate on the pay of Members of Parliament will be taken in more than one week's time, so that the Government may have time in which to reconsider whatever decision will be announced here in a few minutes?
Mr. St. John-Stevas:We shall take that into consideration.
Mr. J. Enoch Powell:Does the Leader of the House expect that we shall have the usual facility of the Official Report next week?
Mr. St. John-Stevas:There are some troubles in printing the reports of the proceedings of the House. We are doing what we can to see that those are resolved. In these delicate matters it is best to say as little as possible at a moment like this. However, I have expectations and hopes for next week.
Mr. Jay:When shall we have a report from the Minister of Agriculture on his activities in Brussels this week?
Mr. St. John-Stevas:My right hon. Friend will report to the House as soon as he returns.
Mr. Eldon Griffiths:As the hay and pea harvests are now starting, and farmers are encountering shortages of diesel fuel, will my right hon. Friend make representations to the Secretary of State for Energy to the effect that another statement on the availability of diesel fuel for tractors would be welcome to many Members of Parliament representing agricultural constituencies?
Mr. St. John-Stevas:I shall certainly convey that important point to my right hon. Friend. He is keeping the situation under continuous review.
Mr. William Hamilton:Will the right hon. Gentleman say whether the debate on Monday will be open-ended?
Mr. St. John-Stevas:It is the intention that the debate on Monday will come to an end at 10 o'clock, whereupon all the votes on the amendments that have been selected by Mr. Speaker will be taken.
Mr. Renton:I am pleased to hear that there will be a debate on multilateral trade negotiations next Friday. Will the Leader of the House ensure that there is adequate time for that? It would be unsatisfactory if only half an hour were available for debating that important subject.
Mr. St. John-Stevas:I have considerable sympathy with the point made by my hon. Friend. I cannot give a categorical assurance in those terms. The length of the debate that occurs before the multilateral trade debate is not within my control. Unless there is time for a debate of approximately two hours, after the proceedings on the Pensioners' Payments and Social Security Bill, it is my intention that the House should proceed to the normal half-hour Adjournment debate.
Mr. Kaufman:As a result of the culpable negligence of the Secretary of State for Industry in failing to lay the necessary orders, the shipbuilding redundancy payments scheme will lapse on Saturday of next week. That will cause great uncertainty among shipbuilding workers. Will the right hon. Gentleman give a categorical assurance that the orders will be laid as soon as possible and that when they are laid they will be made retrospective so that there will be no gap in benefit?
Mr. St. John-Stevas:The right hon. Gentleman has been his usual agile self. He raised a point and then answered it. The effects of the orders will be retroactive, so that the business about which the right hon. Gentleman is concerned will not be in jeopardy.
Mr. Merlyn Rees:As the Leader of the House called the Select Committee reforms to be put to the House on Monday the greatest reforms for 100 years, and as there are five pages of amendments, surely he cannot stop the debate at 10 o'clock.
Mr. St. John-Stevas:That is the present intention. There are large numbers of votes, subject to Mr. Speaker, to be taken. I do not think it desirable that the House should take those votes and make those

1503
most important decisions at a late hour. However, if it is the general wish of hon. Members that we revise the arrangements and take the votes at a later hour, I shall listen to the representations.
Mr. Dalyell:At business questions a fortnight ago the Leader of the House promised to look at the system of ticket allocation. At 3 o'clock the Visitors' Gallery is usually almost half empty. Has the right hon. Gentleman been able to consider the situation?
Mr. St. John-Stevas:Today must be unusual. Perhaps the Gallery filled up rapidly today.
I will consider the hon. Gentleman's point. However, now that the Services Committee has been appointed, this will be an early item on its agenda. That is the appropriate body to follow up the hon. Gentleman's suggestion.
Sir Derek Walker-Smith:If further time is required in which to debate these important matters on Monday, would not it be better to follow the precedent of the previous procedure debate and extend it into a two-day debate?
Mr. St. John-Stevas:The fact that there was that two-day debate should be taken into consideration when we debate the issue next. What is most important now is not steamrollering through measures and further debate but the opportunity to take decisons.
Mr. Alfred Morris:Is the Leader of the House aware of all the humane work of Motability, which exists to provide cars for severely disabled people? Is he also aware that Motability, of which the Prime Minister is a patron, ceased to trade as a result of the increases in VAT and MLR? This is an important matter. Will the Leader of the House ensure that we shall have a statement next week either from the Chancellor of the Exchequer or from the Secretary of State for Social Services to inform us what the Government intend to do to help this enterprise?
Mr. St. John-Stevas:I cannot guarantee a statement. However, I shall certainly ask my right hon. Friend to consider this matter. I shall be in communication with the right hon. Gentleman, as I know that he is an expert on it.
Dr. McDonald:Before the Government take any measures to curtail employees' job protection rights, details of which are at present circulating among trade unions, will the right hon. Gentleman guarantee a full debate on the matter?
Mr. St. John-Stevas:I shall certainly look into the suggestion made by the hon. Lady, but the time for debate on a whole variety of subjects is becoming increasingly limited.
Mr. Ashley:Is the Leader of the House aware of the serious and ominous warning by the chairman of the Supplementary Benefits Commission that the standard of living of the poorest will fall unless £200 million is urgently found, and that the Chancellor this afternoon gave a pedantic, point-scoring, party political answer to a question on this matter? Can we discuss this matter next week?
Mr. St. John-Stevas:I gather from what the right hon. Gentleman said that my right hon. and learned Friend gave him an effective reply. I shall certainly look into the question, but I cannot guarantee a debate next week.
Mr. Speaker:I propose to call those hon. Members who have been standing, if they will be brief. If not, we shall have to move on.
Mr. Canavan:Will the Government provide time for a debate on early-day motion No. 57 to allow the House to come to a decision on the outrageous proposals of the Secretary of State for Scotland to allow the SNP-controlled district council of Cumbernauld and Kilsyth to go ahead with a savage rent increase of 40 per cent.?
[That an humble address be presented to Her Majesty, praying that the Housing (Limitation of Rent Income Increases) (Cumbernauld and Kilsyth District) (Scotland) Revocation Order 1979 (S.I., 1979, No. 669), dated 13th June 1979, a copy of which was laid before this House on 20th June, be annulled.]
This would be an unwarranted attack on the living standards of thousands of my constituents.
Mr. St. John-Stevas:I appreciate the hon. Gentleman's concern for his constituents. I suggest that we should have discussions through the usual channels

1505
about the possibility of finding time for a debate on the subject.
Mr. Field:Given that this week we expect a report on pay for Members of Parliament, would the right hon. Gentleman also find time, before Parliament goes into recess, for a debate on the Supplementary Benefits Commission review of Government proposals to reform the benefit system for the 5 million poor of this country? Would he go further and express the wish that as many Members attend that debate as attend the debate on the pay of Members of Parliament?
Mr. Speaker:Order. The hon. Member must not argue a case now. He must ask a question.
Mr. St. John-Stevas:I am grateful to the hon. Gentleman for raising that point. The report on salaries for Members of Parliament and Ministers has already been published. I fully agree that we must consider this report not in isolation but in relation to social needs of others in the community. I shall consider the suggestion that the hon. Member made.
Mr. Cryer:Will the Leader of the House consider giving time to debating two reports that have been placed in the Vote Office and have been published? They are Department of Trade reports, one on Keyser Ullmann Limited and the extraordinary dealings of that company. Can the right hon. Gentleman assure the House that he will give serious consideration to allowing the House to debate this important report, stemming as it does from the property speculation period which looks as though it will raise its head again? Can the right hon. Gentleman assure the House that he is not involved in any kind of cover-up?
Mr. St. John-Stevas:I certainly give the assurance that I am not involved in any sort of cover-up. I have nothing to cover up and I would not be very good at that sort of operation if I tried it. The report on Keyser Ullmann is a matter that is being considered by my right hon. Friend the Secretary of State for Trade.
Mr. Rooker:With regard to the second motion on Monday, if the Leader of the House intends to shut down business at 10 o'clock, will that be only on the motion
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to set up Select Committees? What about the second motion on the Committee of Selection? Will we have proper time to debate that?
Mr. St. John-Stevas:I hope that it will be for the convenience of the House if the substance of all these matters is debated together. The votes will then be taken individually on the amendments and the motions which Mr. Speaker selects. [HON. MEMBERS: "No."]
Mr. Thomas Cox:Is the Leader of the House aware that the uncertainty about the date when the Summer Recess commences presents real problems to many hon. Members, especially those with young families? When does he think that he may be able to give this year's date?
Mr. St. John-Stevas:I am aware of the importance of that point, particularly for Members who have young children and who need to make plans. I cannot give any undertaking, but I hope that we shall rise at about the usual time.
Mr. Stoddart:May I press the right hon. Gentleman further regarding Monday's debate and put it to him that it really is not good enough to have a one-day debate on this important subject, bearing in mind that the debate that we had previously was in the old Parliament, and was a debate on principle? In this Parliament there are many new Members, who may wish to express their view. Also, we have many amendments that are worthy of proper debate and consideration.
Mr. St. John-Stevas:I am aware of the importance of the point that the hon. Gentleman raised, and that this is indeed a new Parliament. However, it is essential to arrive at an early decision on these matters so that the House can proceed with the appointment of Committees. I shall certainly consider the point that the hon. Gentleman raised.
Mr. James Callaghan:I am grateful to the Leader of the House for saying that he will consider this matter. It must be quite clear to him that there is a lot of dissatisfaction with his present proposal. Therefore, perhaps the usual channels could be used to discuss whether we should debate these issues for two days and take a decision at the end of the second day. I fully accept that we could not have a ragged debate on every amendment, but the right hon. Gentleman might

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get himself into a bit of trouble, because people will be entitled to speak on amendments if they are moved, and it is important that we should come to an agreement to deal with this matter in an orderly way and reach decisions at the end of the second day.
Mr. St. John-Stevas:I respond to that suggestion by the Leader of the Opposition in the spirit in which it was offered. We shall discuss the matter through the usual channels.
Mr. Kilroy-Silk:Can the Leader of the House say when legislation will be brought before the House to fulfil the commitment made in the Queen's Speech to repeal section 2 of the Official Secrets Act, and whether that will be coupled with legislation on an official freedom of information Act?
Mr. St. John-Stevas:We shall certainly have an opportunity, at an early date—though I cannot guarantee that it will be before the Summer Recess—to debate the important matters to which the hon. Gentleman referred.

MEMBERS OF PARLIAMENT AND MINISTERS (PAY)
The Chancellor of the Duchy of Lancaster and Leader of the House of Commons (Mr. Norman St. John-Stevas):The Top Salaries Review Body, under the chairmanship of Lord Boyle, submitted to the Prime Minister on 11 June its twelfth report, which deals with the pay of Members of Parliament, Ministers and office holders of the House of Lords, and with certain allowances. The Government are most grateful to Lord Boyle and his colleagues for their thorough review and clear recommendations. The report was published today and copies are available in the Vote Office.
The Review Body draws attention to the fact that the parliamentary salary has not been brought properly up to date for seven years. It recommends a revised figure of £12,000 with effect from the due date of 13 June 1979. It also recommends that the parliamentary salary of Ministers and other paid office holders who are Members of the House of Commons should be increased from their present level to £7,000. The Review Body makes a series of detailed recommendations about the pay of Ministers and of office holders, of which the most significant are an increase in the pay of Cabinet Ministers from £14,300 to £25,000, and of Parliamentary Secretaries from £6,050 to £13,000, excluding in both cases the relevant part of their parliamentary salary. The other increases it proposes are set out clearly in the report. These increases are large, although this is in part the result of action taken by previous Governments in holding back the recommended rates in earlier reviews.
The Government accept the sums recommended. However, both sides of the House will recognise that it would be entirely wrong if we in this House were to treat ourselves more favourably than others. We have therefore decided to recommend to the House that the full parliamentary increases should not be brought in immediately, but in three equal stages, the first in the present month, the second in June 1980 and the third in June 1981. That is over a two-year period—[HON. MEMBERS: "Three years."]—and not, as reported in some newspapers, a three-year one.

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The Government also propose that the full recommended salary rates should be adopted for pension purposes from the appropriate date this summer. This, too, follows the treatment agreed for other groups covered by the Review Body.
The Review Body also recommends increases in the secretarial allowance for Members of Parliament from £4,200 to £4,600 as an interim measure, pending a final recommendation in the second part of its report, which is due shortly. It proposes increases in the peers' expenses allowance, together with certain changes in the definition of eligible expenditure.
The Government propose that the increases in allowances, including peers' expenses allowances, should be introduced in full immediately. The Government have asked the Review Body to consider urgently the question of secretarial and other necessary expenses incurred by Ministers and other office holders in the House of Lords in the course of their parliamentary duties.
The Review Body considered how its recommended salaries should be kept up to date. Its view was that for Members of Parliament and for Ministers alike, the proper course is regular, independent review. It recognised, however, the practical advantage of finding a suitable way of keeping the salary of Members up to date between reviews and described in detail the comparative advantages and disadvantages of some of the different forms of link that had been suggested to it. This is a difficult issue and there are arguments for and against a link of this kind. The Government prefer, therefore, to reserve judgment until we have had further opportunities to take account of the views of the House.
The rates recommended by the TSRB for the Prime Minister and the Lord Chancellor are, as in the past, higher than those for other Cabinet Ministers. The Prime Minister is unable to be in the House today because she is attending the European Council in Strasbourg. She has, however, authorised me to say that, while she and the Lord Chancellor have agreed that the proposed rates are appropriate for their respective offices and should apply after the next election, they have decided not to accept any increase which would put their ministerial salary above the amount recommended for their
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Cabinet colleagues. Consequently, they will take no increase in ministerial salary until 1981. They have decided to take this course on the clear understanding that all other ministerial increases are accepted, subject only to staging.
The House will have an early opportunity to debate and decide upon these matters.
Mr. Foot:May I ask the right hon. Gentleman, first, what consultations he had, before the Government decided to make these recommendations, with other parties in the House and representatives of Back Benchers who have made representations on these matters over a number of years? What were those consultations and what was their outcome?
Will the right hon. Gentleman also take account of the fact that one of the matters that the House will wish to discuss is the question of the linkage of Members' salaries, as has been proposed previously? Does he recall, as I am sure the House recalls, that the House of Commons itself passed a motion on this matter some years ago, and that the previous Government recommended to the Review Body that it should take special account of that resolution and the recommendation? Therefore, will not the Government come forward with a recommendation on that subject after we have been able to consider it?
Will the right hon. Gentleman also take account of the fact that many of us do not accept for a moment the statement that he makes that what he is proposing about phasing is treating Members of Parliament equally favourably with others, because a very different treatment has been proposed by the present Government for dealing with other questions?
Will the right hon. Gentleman also take account of the fact that the House of Commons now has to decide the matter—it may be that in future we should have some system of linkage, and many of us believe that that would be the right course—and it may be that the House of Commons will wish to insist that the Boyle recommendations should be carried out—not merely the general recommendations but also the recommendations about the phasing, which for some reason the Government apparently have rejected?
Mr. St. John-Stevas:With great respect to the right hon. Member for Ebbw Vale (Mr. Foot), I must say that on the question of consultations he has got his remarks into the wrong context. The context of all our discussions is this House. We have the present report before us, thanks to the efforts of the Back Benchers of the House, including my right hon. Friend the Member for Taunton (Mr. du Cann) and the former chairman of the Parliamentary Labour Party, Mr. Cledwyn Hughes. I take this opportunity to pay tribute to the work that they did. When the Review Body, appointed as a result of their efforts, reported, the Government's duty was to take a view. We have done so.
As a matter of proper courtesy, the Prime Minister conveyed the Government's proposals in advance to the right hon. Gentleman. I did so myself to the leaders of the various minority parties in the House. No doubt the Leader of the Opposition will express the Opposition view and supplement anything that has been said by the right hon. Member for Ebbw Vale. But I must stress that this is not a matter for consultations in the sense implied by the right hon. Member for Ebbw Vale. [HON. MEMBERS: "Why not?"] Because this is not a matter to be settled by discussion through the usual channels; it is a matter to be settled through and by decision of the House of Commons.
The right hon. Gentleman referred, secondly, to the question of the linkage of salaries in this House to some other criterion. This is an extremely complex question, because it raises social questions of other people's standing and their needs throughout the country. We have to decide what Members' salaries should be linked to. The Boyle report recommended against any form of linkage [HON. MEMBERS: "It did not."] Yes, it did, but it recognised that there might be political reasons, and so on, why a Government might have to adopt this course, and it recommended links with an index, the new earnings review. But that is quite a different link from that suggested by the House of Commons itself when it last discussed this matter.
That conflict alone should show the House that it is a difficult issue and cannot be decided within a few days of the receipt of the report. Having taken
1512
account of all the considerations and debated the issues, it is for the House to reach a decision.
The right hon. Member for Ebbw Vale said that different people had been differently treated by the Government. That is not true as far as the three review bodies are concerned. With the exception of the police and defence forces, all the salary increases recommended by those bodies have been spread over two years.
Mr. Foot:Of course I am not suggesting that the matter should be settled by consultations through the usual channels or with representative bodies of Back Bench opinion. I am suggesting that if if only the right hon. Gentleman had taken the same course as previous Governments he might not have come forward with recommendations that the House will regard as unfair to hon. Members.
Mr. St. John-Stevas::I can only express my disagreement with the right hon. Gentleman.
Mr. du Cann:I agree with my right hon. Friend that such decisions ultimately must be for the House, but will he, as Leader, follow the example of his predecessor which led to the establishment of Boyle and be good enough, before we discuss the matter, to receive representations about the numerous issues that flow from his statement and that have given obvious concern to us all? Phasing is one of those issues. Secondly, and more important, is the need to discover a method by which the British House of Commons can be saved from such embarrassments in future. Finally, will my right hon. Friend explain why we read about these matters in the newspapers or hear about them on the radio before hon. Members are themselves informed?
Mr. St. John-Stevas:We take all the precautions that we can to ensure that leaks do not occur, but unfortunately they happen from time to time. I cannot say where they came from. I certainly regret the leaking of frequently inaccurate information before issues are brought before this House.
I am in the greatest sympathy with my right hon. Friend's second point. These matters are embarrassing to all hon. Members and should be dealt with in a

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dignified and reasonable manner. I shall be grateful for representations from my right hon. Friend and other hon. Members on that.
Mr. David Steel: Is the Leader of the House aware that I was one of those who accepted, in the 1975 Division, that we should reject the recommendations of Boyle and accept a lower salary? With the benefit of hindsight, I think that that decision was wrong. Does the right hon. Gentleman accept that Boyle put in italics the point that our salaries now—four years later—are still lower than was recommended four years ago? Will he note that Boyle specifically said that if there were to be staging it should be done in two stages by no later than June 1980?
Will the right hon. Gentleman assure us that in the debate we shall have the opportunity to vote for that option? Finally, will he recall specifically that in 1975 the House actually had a vote and decided that it was in favour of the principle of linking? It urged that that be done by the new Government within three months of the election, and we regarded that as binding on whichever Government came to power.
Mr. St. John-Stevas: I agree that salaries of Members of Parliament—and even more of Ministers—have fallen dramatically behind. That was due to the anomaly of the last decision not to implement the £8,000 recommendation, which, as the right hon. Gentleman candidly admitted, he supported. That is the difference between this recommendation of the Government and that on the previous occasion. We have accepted that figure, but have said that it should be phased—[HON. MEMBERS: "Three years."]—No, it is not three years. It is two years. We have said that it should be phased over the period that I have outlined.
It is the Government's duty to see that justice is done to hon. Members. It is equally the duty of the Government in particular and the Leader of the House to see that our proposals do not undermine the position of this House in the country. This House rests ultimately on the good will and respect of the electorate. We should forfeit that respect if we treated ourselves more favourably than other groups in society.
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Whatever propositions the Government put forward on these matters, it is for the House, having considered carefully the issues on a free vote, to decide what should be done.
Mr. James Callaghan: I am grateful for the Prime Minister's courtesy in giving me prior information. As far as I know, I am not responsible for the leak. I should have preferred some consultation instead of just being asked to go and hear the Government's decision. However, I make no further point on that.
Our Government and the Government before us must accept responsibility for the position in which the House and hon. Members find themselves. We should not seek to make party advantage out of that—and so far no one has done so.
Boyle is independent and comprises a number of people who have made recommendations for other groups. That is precisely to avoid the embarrassment to which the right hon. Member for Taunton (Mr. du Cann) refers. The way to avoid that embarrassment and the invidious fact that hon. Members may feel that they have to vote against the Government to increase their salaries is to accept the Boyle report.
Boyle proposed initially—and it is clear that that was his real view—that because hon. Members had fallen so far behind there should not be staging. He then concluded that it would be right to stage in such a way that half should be paid on 1 June 1979 and the remainder on 1 June 1980 or, if linkage or updating was introduced, that the second instalment should be paid in November 1980.
The right hon. Gentleman has seen the turbulence in the House. Speaking for myself, I believe that there would be overwhelming support in the House for the proposition that Boyle should be accepted in one of those two forms. If that were so, both sides of the House would have to accept equal responsibility for what was done. We should have to account for ourselves to our electors and constituents. Most of us would have no difficulty in that, in view of the past record on the matter.
Mr. St. John-Stevas: I am grateful to the Leader of the Opposition for that constructive intervention. We have accepted the principal recommendation of Lord Boyle's report that the salaries of

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Members of Parliament should be raised to £12,000. It is true that the report recommended against staging, but, recognising certain political difficulties, it went on to suggest a form of staging as a reluctant alternative. I have outlined to the House why that time scale is not acceptable to the Government. The House must now consider the matter and see whether it takes a different view.
The Leader of the Opposition said that we must follow the Boyle report on linkage. If we do, it means that we must come out against linkage. But again, in a second thought, the Boyle report recommended linkage with an index. This is a complex matter, and the House has made another recommendation. However, I assure the House that in this matter the House of Commons is sovereign. If the House, by whatever means, indicates clearly that it wants a particular form of linkage after it has had time to reflect on the issues, of course the Government will accept that decision.
Mr. Callaghan: I am grateful to the right hon. Gentleman for indicating that this would be a matter for individual hon. Members to take their decisions upon, but will he please reconsider the issue and not put us in the position of saying that we must differ from the Government on this matter? We do not necessarily wish to differ from the Government. Instead of hon. Members reconsidering the matter, will the Government, who have had no previous consultations, take the matter back and reconsider it to see whether, on the basis of the arguments in Boyle and on the basis of the expression of the feeling in the House this afternoon, they cannot come forward with a resolution based on Boyle? Then, if hon. Members disagree and want to take a more restricted view, they may vote against that proposition. I suggest that the Government should reconsider the matter, bring forward Boyle and then let the House, in its sovereign responsibility, take a decision on that.
Mr. St. John-Stevas: The Leader of the Opposition has had a full response from myself on the essential points. I have said that the Government will accept the decision of this House. That is the major issue. How this recommendation on linkage comes forward is a minor matter, and there are a number of ways in which it can be pursued.
Mr. Emery: Does my right hon. Friend accept that this was a very difficult statement to make and that it is obvious from the submissions that have been put to him that a large number of hon. Members believe that Members of Parliament deserve to be paid the full amount that has been recommended by Boyle? However, if linkage were to be put into that recommendation, I believe that hon. Members would be more than willing to accept the staging. Without the matter of linking, the acceptance of the staging may well mean that at the end of three years Members of Parliament would again be 30 per cent. or 40 per cent. out of kilter with the rest of the economy. Therefore, I believe that it is important that if linkage is put in in the manner suggested by Boyle it will ensure that the Government obtain staging, which they feel is necessary.
Mr. St. John-Stevas: I do not necessarily agree with everything that my hon. Friend said. However, he made a very important and constructive contribution to what I hope all Members will recognise is an extremely difficult situation to resolve. I shall take full account of that consideration, along with others that are made in the course of these questions.
Mr. Molyneaux: As there does not appear to be any shortage of volunteers to come to this place, can the hardship really be as great as we are led to believe? Secondly, does the Leader of the House agree that the status and standing of, and respect for, Members of Parliament would be further diminished if we were to award ourselves, from public funds, vast immediate increases at a time when we are preaching restraint to others?
Mr. St. John-Stevas: I am extremely grateful to the hon. Gentleman for that contribution. Of course it is a privilege to serve as a Member of this House. I accept that. I accept also that labourers are worthy of their hire. I accept also the point that the hon. Gentleman made that we must take account of feeling and opinion in the country, which is not always the same as the opinion expressed by reporters and newspaper editorials.
Several Hon.rose—
Mr. Speaker: Order. May I appeal to hon. Members not to argue the case but

1517
to ask a question? I must be mindful that a half-day Supply debate follows and hon. Members are deeply interested in it. That debate will end at 7 pm. I shall include as many hon. Members as I can.
Sir Derek Walker-Smith: Is not my right hon. Friend, like Clive of old, astonished at his own moderation? Is it not a fact that assistant secretaries in the Civil Service—not a very exalted grade—with whom it has been suggested Members of Parliament might be linked for pay purposes, will receive an increase from about £13,000 to £17,000, or perhaps £18,000 taking account of the London weighting allowance, to take effect no later than 1 January? Will not my right hon. Friend reconsider the long phasing proposed for Members' pay? With great respect, I do not agree with his assessment of the public's reaction. Will he do his best to make clear to the public, in which he will be assisted by hon. Members of this House, that this is at best a tardy and partial act of justice?
Mr. St. John-Stevas: I am grateful to my right hon. and learned Friend for pointing out in a practical and restrained way one of the difficulties of linkage. If we had a straight linkage of the kind that the House wished, we would be advancing the salary far beyond £12,000 to the ultimate £17,000 to which my right hon. and learned Friend has referred. We must avoid that. I am extremely grateful to the Leader of the Opposition for the statesmanlike way in which he approached this difficult matter. We must recognise that we are in a difficult situation and we must resolve it in accordance with justice to Members and the good standing of this House in the country.
Mr. Mike Thomas: Is the right hon. Gentleman aware that in paragraph 21 of the Boyle report it is recommended not only that staging, which Boyle was basically against, should be completed by June 1980, but also, if staging were contemplated, that the increase in Members' salaries should be accordingly updated in the intervening period? Will he give a firm commitment that in the event of any staging—I do not concede that the House will accept that—he will suitably update the pay in the interim?
Mr. St. John-Stevas: I must point out that the hon. Member's argument, and, indeed, the argument of Lord Boyle's report, would be absolutely true if we were living in an abstract world of logic and justice. But, in fact, we are not. We are returned here by our constituents, who have great financial problems and who are looking to us to be fair to ourselves, but also to set an example to others.
Mr. William Clark: Does my right hon. Friend agree that, whether it was the fault of the previous Government or the Government before that, it is never the right time to increase the salaries of Members of Parliament? This is the dilemma that any Government face. Will my right hon. Friend give an assurance—as there is a lot of feeling about this matter on all sides of the House—that when the issue is debated in the House, if the House decides that phasing is not on and that the £12,000 should come immediately, and, indeed, that there should be some form of linkage, the Government will then accept the decision of the House and not put the matter to any other committee?
Mr. St. John-Stevas: I have already made it clear that the Government will be bound by the decision of this House. Members must consider not only their interests but the long-term interests of the House as a corporate body. We are not here solely for ourselves; we are here as part of this House of Commons, representative of the nation. We must consider both sides of the coin in order to reach a just and reasonable solution that is acceptable to the country.
Mr. Ashley: As the Donnison recommendations were published before the Boyle report, may we take it that this House will discuss those recommendations, on poor people's pay, before the report relating to the pay of hon. Members?
Mr. St. John-Stevas: I cannot give that undertaking, but I welcome the point made by the right hon. Gentleman in drawing attention to the social and economic condition of the entire country of which we are a part.
Mr. George Gardiner: I am sure that my right hon. Friend will agree that Members of this House have for a long

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time received adjustment of their salaries towards the end of the annual pay review. Therefore, does he accept that an award that is paid in three stages, the last stage of which is in June 1981, is a three-stage rather than a two-stage payment? For the enlightenment of the House, will he point to any other occupational group which has had its pay award phased over a similarly long period?
Mr. St. John-Stevas: If I may correct my hon. Friend, I believe that there is a difference between the staging and the period over which it is staged. Before there is a great storm again, I remind the House that this is a three-stage award over a two-year period. [HON. MEMBERS: "No."] I know that none of us in this House is a professor of mathematics, but if the first stage of the award is made on 13 June 1979 and the last stage is made in June 1981, the period is two years.
Let me give my hon. Friend other examples of those who have had similar three-stage awards over a two-year period—if I may dare use those offending words again. I refer to civil servants, senior members of the Armed Forces, the judiciary, the senior managers of the nationalised industries who were referred to the Top Salaries Review Body, and the doctors and dentists who were referred to that body. The only exception was the reference of the Armed Forces and the police. Therefore, it is against that background of principle that this recommendation is made.
Mr. Ashton: Has the right hon. Gentleman seen that part of the Boyle report which says that since the last Boyle report in 1975, which was not implemented, the national average wage has risen by 60 per cent. when the pay of Members of Parliament has risen by only 17 per cent.? Is it not, in all fairness, time that we caught up?
Mr. St. John-Stevas: That is a most telling figure, and I hope that it will be noted by those who comment on and publicise this matter. Indeed, if the increase that has been reported by Lord Boyle's committee had been based on the pension figure of £8,000, as uprated, the increase proposed today would be 28 per cent. That figure, taken with the figure given by the hon. Member for Bassetlaw (Mr. Ashton), gives a reason-
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able picture of the situation. We have accepted a £5,000 rise. I do not think that it would have been acceptable if we had paid ourselves that all at once.
Mr. James Callaghan: I apologise for intervening again, but may I put a clear question to the right hon. Gentleman? In the light of the views expressed in the form of questions from both sides of the House this afternoon, will he report back to the Cabinet what has taken place in the House and invite the Cabinet to reconsider its decision and ask it to come forward with recommendations based on the Boyle stages, leaving it to hon. Members—if they take the view of the Leader of the House—to impose a more restrictive condition if they think fit?
Mr. St. John-Stevas: The Cabinet has thought very carefully about these matters and has given its view to the House. I, as Leader of the House, am most willing to receive representations—[HON. MEMBERS: "When?"] I have had representations. It is not always those who make the most noise who are the most representative. There may be others in this House who take a different view. I am open to all representations, so that we can reach a satisfactory solution to this problem in the interests of the House and the country that we represent.
Several Hon. Members rose—
Mr. Speaker: Order. I propose to call two more hon. Members from either side.
Mr. Nicholas Winterton: Is my right hon. Friend aware that his statement this afternoon is both deplorable and disgraceful to many Members on both sides of the House? Will he take seriously the request made, in a moderate and responsible fashion, by the right hon. Gentleman the Leader of the Opposition and reconsider the proposals that have been put to the House this afternoon? Will he also give an assurance that there will be a free vote in this House on the subject, including Ministers, so that the House can come to a proper decision? Furthermore, will he say how hon. Members are to be able to contain and manage the bureaucracy if the people who comprise it are given much better facilities and far higher salaries than Members of this House?
Mr. St. John-Stevas: On the question of a free vote, I must point out that the proposals that have been put before the House are Government proposals. Since they are Government proposals, they will be supported by the Government. [HON. MEMBERS: "Oh."] Yes, of course, they must be. It is no good hon. Gentlemen shouting. That is the most elementary rule in our constitution. There is a Government recommendation before the House, but hon. Members who are not members of the Government will be free to vote according to their interests. I cannot speak for members of the Opposition. I am saying, I hope as clearly and as openly as I can, what the situation is from the Government's point of view.
I have already expressed my appreciation of the attitude taken by the right hon. Gentleman the Leader of the Opposition. I am sure that he will be delighted that that support has now been backed by my hon. Friend the Member for Macclesfield (Mr. Winterton). However, I cannot agree that these proposals are deplorable and disgraceful.
Mr. Winterton: They are.
Mr. St. John-Stevas: That is my hon. Friend's view. I believe that they are a responsible attempt to put forward proposals that reconcile a number of conflicting interests. There is no proposal before the House on the question of linkage. It is a matter for the House to decide and not a matter for Government proposals.
Mr. Cohen: Does the right hon. Gentleman regard Ministers as Members of the House? He said that eventually the House will decide what is to happen on the matter. In reply to the question from his hon. Friend the Member for Macclesfield (Mr. Winterton) he stated clearly that Government Ministers will not be entitled to the privilege of a free vote. I should like to ask the right hon. Gentleman three questions and I like succinct and short answers to them.
Mr. St. John-Stevas: I hope that the hon. Gentleman's questions will be short.
Mr. Cohen: They will be short. First, will time be provided to debate the matter? Secondly, will the debate be
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on the basis of either "Yes" or "No" to the Government's proposals or will there be the right to introduce amendments? Thirdly, in the light of what has happened here today, will the right of Ministers and all Members of the House to have a free vote be reconsidered? It is not a political matter, and there will be support across the Chamber. The Government will be well advised to take account of the strength of feeling in the House.
Mr. St. John-Stevas: I appreciate the hon. Gentleman's argument. However, it is a contradictory proposal for the Government, as the Government, to put proposals before the House and not to support them. If a Government Minister does not wish to support the recommendations and he wishes to exercise his right as a Back Bencher, he is free to do so. In reply to the question "Will the Government provide time for the matter to be debated?" the answer is "Yes". In reply to the question "Will it be possible for Members of the House to vote either 'Yes' or 'No' or to table amendments?", the answer is "Yes". I cannot be more succinct than that.
Sir Raymond Gower: Does my right hon. Friend recall that when the House last considered the matter the question of linkage was debated at considerable length and in great detail? The House reached a certain conclusion. Is it not remarkable that my right hon. Friend is speaking about linkage as if it were a novel idea upon which he would like to ascertain hon. Members' views? All hon. Members take a certain amount of stick on the issue—it is invidious—and there is a certain degree of opprobrium expressed. Does my right hon. Friend recognise that the formula commended by the Government, through him, is one that ensures maximum opprobrium, staggered over three years?
Mr. St. John-Stevas: I shall resist the temptation to resume the three year-two year argument. I wish that there was an independent review body to which the matter could be referred. I am not saying that the idea of linking is novel; I am saying something quite different—that it is a complex idea. Before we decide on the form that linking should take, there must be an opportunity for

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reflection and discussion about the difficulties involved and which form of linkage is the most appropriate. The Government have not taken a view on the matter.
Mr. Mike Thomas: The House has taken a view.
Mr. St. John-Stevas: This House of Commons has not taken a view on the matter—a previous House of Commons has. That is one of the indications that must be taken into account, but it cannot be the resolution of the question. What the Government are saying is that if the House wants linkage it must put forward a motion and we shall see what the support in the House is for the matter. When that has been assessed, appropriate action will be taken with that result in mind. The Government have responsibility to propose, but the House, in the last resort, disposes of the issue.
Mr. Straw: Is the Chancellor of the Duchy of Lancaster aware that, with respect, he was in error in suggesting to the House that the Government have treated the Review Body's proposals on Members' pay consistently with the manner in which the Government have treated other Review Body proposals on pay? Is he aware that in respect of doctors and dentists—the nearest analogue to Members of Parliament—the Government accepted in full the recommendations of the Review Body, including those on staging and updating? In the light of that, does he believe that, far from treating hon. Members more favourably than members of the public, the Government are treating them less favourably? Finally, would the Chancellor of the Duchy of Lancaster kindly subtract 78 from 81 and tell the House what the answer is?
Mr. St. John-Stevas: I am willing to do that and I think that I could if I tried. However, we are not in the year 1978; we are in the year 1979. I hope that we do not need an independent review body to resolve that question. The doctor and dentist review stretches over a two-year period from 1978 to 1980.
Mr. Peter Bottomley: On a point of order, Mr. Speaker. Have there been any changes in the procedure of the House since 1975? At that time, the House did the best that it could to link Members' pay. When it was not possible to make that binding on the Government, it was because of the procedures of the House. Have those procedures changed, or will there remain the same difficulty if the course outlined by the Chancellor of the Duchy of Lancaster is followed?
Mr. English: Further to that point of order, Mr. Speaker. Are you able to confirm whether a Cabinet Minister's statement is equivalent to that of a Treasury Minister? If so, by his repeated statements today, the Leader of the House has committed the Government to introduce a money resolution such that hon. Members could, if they wished, vote for the Boyle recommendation and not merely for the Cabinet's recommendation.
Mr. Ogden: On a point of order, Mr. Speaker. Will the Leader of the House be allowed to make further comment, not only about salaries and linkages but about the possible effect of wage freezes on those over the next few years?
Mr. Speaker: I am afraid that I am unable to help hon. Members with the questions that they have raised.

ORDERS OF THE DAY
  SUPPLY
  [1st ALLOTTED DAY]—considered.

  MANPOWER SERVICES COMMISSION
  Mr. Speaker: Before I call the right hon. Member for Chesterfield (Mr. Varley) I should remind the House that the debate will conclude at seven o'clock. Therefore, brief speeches are the order of the day. I should like new hon. Members to know that, when I keep the register of the length of hon. Members' speeches, I do not count speeches that are eight minutes or under in length.
  4.38 p.m.
  Mr. Eric G. Varley: I beg to move,
  That this House is opposed to the decision of the Government to reduce the budget of the Manpower Services Commission which will injure the prospects of jobs for the long-term unemployed, and will adversely affect the opportunities of employment for young people at a time when the Government's stated economic policy will substantially increase unemployment.
  For my part, Mr. Speaker, I shall observe your request for short speeches I know that several of my hon. Friends wish to take part in the truncated debate. The cuts on which we are seeking to censure the Government today were announced in the Budget. Therefore, it is against the background of the Budget that the cuts should be examined. The Budget will put many more workers out of a job. How many workers we do not know because the Government are coy about revealing the forecasts which they undoubtedly possess.
  We know that the increase in the minimum lending rate and the cuts in local government expenditure will put more people on the dole. The Prime Minister made clear on Tuesday that her incomes policy—and she has an incomes policy—will also put more people on the dole. There will be bankruptcies—some say bankruptcies galore—in the private sector and jobs in the public sector will be squeezed, as Government Ministers have said, by the tightening of cash limits.
  The relaxation of the restriction on the export of capital will export many jobs
  1526
  that survive the Government's anti-employment measures. It is no wonder that the Secretary of State for Employment was compelled to admit to the House on Tuesday that unemployment, which was steadily falling month by month under the previous Government, is bound to go up.
  It is against that background that we have to examine the mean-minded and damaging cuts in the Labour Government's employment schemes. Whenever we watch a war film on television we know that there will always be one good German in it. It is the same with the Secretary of State for Employment. He made his reputation by being the nice guy among the Tory "bower boys" and "bovver girls".
  The right hon. Gentleman was able to get away with that in Opposition because he did not have the responsibility. We used to have soothing words from him, but now we have to judge him by his actions and we believe that his actions so far are damaging. Some would say that they are worse than those that will be imposed by the Secretary of State for Industry in his line of country.
  Either the Secretary of State for Employment fought in Cabinet and lost or he did not bother to fight. Even worse, he probably offered these miserable cuts because he actually believes in them. After all, we are informed by the press that the Prime Minister told her Cabinet colleagues that their virility will be judged by the spending cuts that they offer voluntarily.
  Unless the explanation for the cuts is convincing, the Secretary of State is about to lose his halo and take his place in the Tory rogues' gallery. I am looking forward to his explanation. Whatever else the right hon. Gentleman was thought to be, we were always given to understand that he was a great consulter. Did he consult the TUC or even the CBI before making the cuts? I do not think that he did.
  Even more serious from our point of view is the question whether the right hon. Gentleman consulted the Manpower Services Commission itself. The budget and programmes of the MSC are lacerated by the cuts. I suspect that he did not consult the Commission, but if he cares to tell me now that he did—and by "consult" I mean real consultation in

  1527
  advance and not calling in representatives of the MSC just before the Budget—I shall be glad to give way. The right hon. Gentleman is not seeking to intervene. Clearly he did not consult the MSC. No doubt he said that these were budgetary matters and he probably called in the MSC representatives a few hours before the Budget to inform them that the cuts were to be imposed.
  It may be that some Conservative Members regard the MSC as what has come to be described in Tory vocabulary as a quango, but the Secretary of State knows that it is not a quango. It is a fully representative body and was set up by the previous Tory Government who extracted it from the Department of Employment machinery and turned it into the organisation that it is today. Did the Secretary of State give his own party's creation the brush-off? I suspect that he did. I suspect that he did not consult the Commission.
  It is suggested that the right hon. Gentleman had his first meeting with the full Commission yesterday. Will he tell us what came out of that meeting? More important, what did the right hon. Gentleman tell the Commission? Was he told that the Commission found the cuts acceptable or that they would damage the MSC programmes? Did the Commission tell the right hon. Gentleman that it could absorb the cuts painlessly or that they could be implemented only by undermining some of its programmes?
  The Minister of State, Civil Service Department told the House yesterday that the Government are anxious to provide us with the maximum possible amount of information. The Secretary of State will therefore presumably welcome the opportunity of answering my questions. They are quite simple questions and I suspect that they were put to him at his meeting with the MSC yesterday.
  Was he told at that meeting that the cuts would so damage the MSC programmes that it would not be possible to continue some of them? I shall be grateful if the right hon. Gentleman will also clarify the press notice issued by his Department on Budget day. Perhaps we may also have the clarification of definitions in the departmental dictionary, because the press notice said:
  "All of the existing special employment measures will continue … some of them will
  1528
  in future be concentrated on the areas where unemployment is highest and the need for special assistance greatest."
  What does the word "concentrated" mean in that context? Does it mean that, although some of the measures will be removed from what the Secretary of State believes to be less deserving areas, the amount of finance will be increased in what he regards as the more deserving areas? If so, will he tell us how much and where?
  The right hon. Gentleman would do better to confess that the use of the word "concentrated" in that press notice is misleading to the point of being fraudulent. Will he admit that support under the schemes will not be "concentrated" in certain areas, but will be confined to certain areas? The use of the word "concentrated" covers up the fact that the cut in the special temporary employment programme of £42 million is a 50 per cent. cut and will deny employment over the next nine months to more than 20,000 long-term unemployed people.
  It is easy to go through the list of schemes to catologue the iniquities perpetrated upon them. I do not want to take too much time, so I shall just go through the list briefly. The community industry scheme will be seriously affected. The Department's press release refers distortedly to an expansion of the programme. In fact, the planned expansion by the Labour Government is being cut back by 1,000 places out of 7,000 places.
  The Government are cutting back on the small firms employment subsidy. The Department has the nerve to claim in its press notice, as Treasury Ministers have claimed, that the Government have the interests of small firms at heart, but there is to be a cut in the small firms employment subsidy.
  When the Secretary of State was in Opposition, he made a practice of issuing statements lamenting the impact of unemployment on school leavers. Yet now he proposes a deplorable cut in the youth opportunities programme. My hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding), who is to wind up for the Opposition, will have more to say about that.
  All the cuts are damaging, and no doubt my hon. Friends who take part in the debate will outline the impact on

  1529
  their constituencies. In addition to the STEP programme reductions, there are two cuts that I find particularly distressing. They are the cuts in the temporary short-time working compensation scheme and the MSC training programmes.
  The short-time working compensation scheme was the previous Government's machinery to replace the temporary employment subsidy which was highly valued by hon. Members on both sides of the House. Reducing the period for which the short-time working scheme is available from a year to six months may cripple it beyond repair. Our intention in this financial year was to use the scheme to save 55,000 jobs in vulnerable areas and industries where there was likely to be high unemployment. Slashing that safety net in half will render it useless. Even worse, I understand that there is a question mark over the scheme as a whole. The right hon. Gentleman usually gives straight answers and we want them today.
  What is to be the future of the scheme, truncated as it is? Will the right hon. Gentleman put it on a statutory basis, as we hoped to do, or will he make sure that it is buried or got rid of secretly? I hope that that will not prove to be the case and that the right hon. Gentleman will have second thoughts about it.
  But, of course, the Secretary of State may say that this scheme—perhaps all the schemes, for all I know—simply perpetuate what the Prime Minister is pleased to call phoney jobs. We utterly reject that view. We believe that at least the Government are under an obligation to tell us how they intend to create what they describe as real jobs. Even if all the mythical entrepreneurs are galvanised by the Budget into creating dynamic technologically advanced industries, those industries will have to be manned, and they cannot be manned if men and women are not available with the necessary skills. So the £32 million cut in the MSC's training programme is an act of wanton folly even according to the Government's own criteria.
  Although questions have been put to the Government, even the Treasury is as yet unable to quantify how great the tax handouts in the Budget will be for those with the highest incomes. The right hon. Gentleman is entitled to correct me if I
  1530
  am wrong, but I reckon that the total will be near £1 billion in a full year. The estimate depends on where one starts, of course, but the sum is certainly over £500 million. Let us compare that huge sum with the miserable cut of £170 million which we regard as petty and spiteful.
  The right hon. Gentleman is in charge of planting the seed corn. Instead, by accepting the savage cuts in these various schemes, he is scattering the seed corn to the winds. It will not even mean a saving of Government expenditure, because these petty economies will inevitably lead to far greater sums being paid out to those who will go on the dole.
  At Question Time on Tuesday, Tory Member after Tory Member bobbed up and asked for special favours for his constituency. The Secretary of State and his colleagues foisted a new bit of Tory jargon upon us. It seems that vulnerable areas and groups have to be "resilient". That is the new vogue word.
  So, in this package of cuts, those who could have been given temporary employment will have to be resilient; unemployed young people, 16 to 18, will have to be resilient; disadvantaged young people will have to be resilient; workers whose factories face temporary restructuring will have to be resilient; workers for small firms in industry and commerce will have to be resilient; those who would have benefited from training which will now be denied them will have to be resilient.
  That is a lot of resilience. The Secretary of State will not reveal his own forecast to the House, but he freely admits that unemployment is going to go up; indeed, there is no doubt that over the next 12 months unemployment will rise. The right hon. Gentleman should live up to the standards he sought to proclaim in Opposition. He should take back this miserable ragbag of cuts. If he does not, we shall divide the House at seven o'clock.
  4.54 p.m.
  The Secretary of State for Employment (Mr. James Prior): The right hon. Member for Chesterfield (Mr. Varley) has been in characteristic form, and I hope that we shall have longer to debate these vital and important matters of employment policy as the years go by. I admire his courage in moving the motion. After

  1531
  all, the record of the Labour Government over unemployment suggests that it would have been better for the Opposition to take a period of enforced silence before talking to us about unemployment.
  The right hon. Gentleman said that the Government were coy about revealing their forecasts. It may help him if I read what the right hon. Member for Leeds, East (Mr. Healey) said as Chancellor of the Exchequer in 1976:
  "The fact is that no one can predict with any hope of accuracy the path of unemployment over the next few years. As the hon. Member for Oswestry said the other day:
  'It simply does not lie within the capability of Government to give employment targets.'"—[Official Report, 21 December 1976; Vol. 923, c. 499.]
  It is quite obvious that the right hon. Member for Leeds, East fully agreed at that time that it was impossible to give accurate forecasts.
  I have said that I believe that unemployment is likely to go up over the next vear or so, and perhaps the right hon. Member for Chesterfield would like to consult the right hon. Member for Leeds, East and ask him what were the Treasury forecasts which were given to him before the general election. If he asks that question, he may get an answer that he will understand, but it will be one that he will not readily wish to accept.
  I believe that the present state of Britain and the state of world trade will make unemployment very dfficult to keep down over the next few years, and I want to address my remarks to what I believe is the difference in philosophy and economic policy between the two sides of the House. I say at once that, although there is strong disagreement about the means of curing unemployment or of keeping it at a reasonable level, I do not believe that anything separates us about ends.
  The scourge of unemployment, particularly where it is synonymous with poverty, crime and bad conditions, is totally unacceptable to all Members and to the nation as a whole. I put it in those terms because, as I have said, we may by 10, 15 or 20 years' time have adopted a different attitude to unemployment from the one we have today. But for the moment at any rate it is a scourge and one that we have to deal with as being totally unacceptable.
  1532
  The Conservative Party's record on unemployment compares more than favourably with that of the Labour Party. In the five years of Labour rule from 1974 to 1979, the numbers of unemployed more than doubled to 1·3 million, and youth unemployment, of which the right hon. Gentleman made so much, went up in 1978 compared with 1973 by six times.
  Mrs. Elaine Kellett Bowman: Is my right hon. Friend aware that during the period of Labour rule the figures trebled in my consituency?
  Mr. Prior: I think that they trebled in a large number of cases. Since the war, every Labour Government have left more people out of work than were unemployed when they came to office. That is an inescapable fact of political life. It would therefore come better from the Opposition if they approached this debate—which they initiated—with some humility, and perhaps questioned their own policies and tried to understand why they simply did not work.
  Listening to the right hon. Gentleman and reading the motion, the impression is that we should continue with the same policies, subsidising more here and more somewhere else, and paying for those policies by high taxation and a balance between the private and public sector which has discouraged manufacturing investment and production. I could put the issue in these words:
  "Our public expenditure has grown faster than our rate of economic growth could sustain. I also believe that this has been an important reason for our generally poor industrial performance, for it has meant that the public sector—that is both central and local government—has pre-empted financial and manpower resources at the expense of manufacturing industries. That position has to be reversed. It will be both painful and difficult."
  That is what the former Chief Secretary to the Treasury, the right hon. Member for Heywood and Royton (Mr. Barnett), was saying in November 1976. It was true then and it is true today. One can look at the figures alone. In December 1973, there were 7,799,000 people employed in manufacturing industry. In December 1978, the figure was 7,167,000—a decline of 632,000 people. During that period, manufacturing output declined by 4 per cent.: we were actually producing 4 per cent. less goods from our factories in 1978 than we produced in 1973. In 1978, perhaps the only year

  1533
  in the last five years when living standards in Britain increased and there was more real spending power in the economy, the import of manufactured goods increased by 13½ per cent.
  What we have to face as a country, let alone as a House of Commons, is that we are busy importing other people's unemployment. We are importing it in the car industry and in all the consumer durable industries. We are importing it in a whole range of manufactured goods. Those are goods that we should be making for ourselves but which we are not making. Instead, we are importing them. It is a sorry picture for our country.
  In a debate in the last Parliament, I quoted the figure for cars. In 1960, we in Britain built 1,345,000 cars. In that same year, the French built just over 1 million cars. By 1977, we were building 1,300,000 cars, rather fewer than we had built in 1960, while French car production had gone up to over 3 million. That is one of the reasons why our unemployment has risen. It is one of the reasons why our prosperity, relative to other countries, has declined. It is one of the reasons why we have become a country with high unemployment. As our unemployment has risen, we have looked for other means of trying to keep numbers of people off the register and in some sort of work.
  As well as those problems, we face world economic factors which will make our task even harder. Given the experience of the last few years, we are not likely to get out of our difficulties by pursuing the same policies that have been pursued for the past five years. If the Opposition consider that these support policies were the answer to our unemployment problems and all that was necessary was to continue expanding them, I would only say that the number of people being helped by the policies and the schemes that the right hon. Gentleman mentioned are running at about 70,000 less than a year ago. Despite my belief that these schemes are only part of the answer, which is why we have cut the budget by £172 million, they will still be assisting next spring 50,000 more people than they were assisting this spring.
  1534
  Even with this cut of £172 million, for which I make no apology, because it is essential to try a new approach, we have kept the schemes in operation, although restricted more to the special development areas and the development areas so that we achieve a real difference between areas of high unemployment and other areas.
  We are talking mostly about cuts in forecasts—I shall return to this later in my speech—rather than cuts in the programme as a whole. If the right hon. Member for Chesterfield believes that I have to sustain my virility within the Government and the Cabinet by accepting bigger cuts than might otherwise have been pushed upon me, he has not followed carefully my progress, or lack of progress, in the House in the last 10 years.
  We are fulfilling our clear election commitment to reduce public expenditure but to concentrate aid. My definition of "concentrate" is that we are keeping the same degree of aid almost untouched in the special development areas and in the development areas and cutting aid from certain other parts, which will enable greater aid to be given to areas of high unemployment. That is what we said we would do. We said that we would concentrate aid on the areas and the groups of people where the need was greatest.
  There has been a period of very rapid expansion, and there is a need for consolidation. In five years, the expenditure at outturn prices of the Manpower Services Commission has gone up from £120 million to £514 million. As with all rapidly growing organisations, the time has come, in any case, for some tightening up of the schemes and perhaps an improvement in administration, to make those who run them and those who take part recognise their costs and their value.
  Scare stories were put about at the general election that we would destroy all these schemes. We had to fight hard to stop people believing that we intended to destroy the schemes, including the Manpower Services Commission, overnight. The idea put out during the campaign that we would destroy the Manpower Services Commission came ill

  1535
  from a party that knew that we had set up the Commission.
  We were told that our aim was to destroy the scheme and to create deserts of unemployment in the North-West and other areas. The former Prime Minister went to Glasgow and announced that we were determined to produce deserts of unemployment in Glasgow and other parts of the country. I do not know what he had been doing over the previous years when his Government were creating unemployment. All the scare stories put out by the Labour Party that we would cut back these schemes seem to have had precisely the opposite effect in the minds of the electorate to what the Labour Party hoped.
  Mr. Varley:I have no recollection of my party officially putting out scare stories that the Manpower Services Commission would be wrecked or abolished. Will the right hon. Gentleman say whether he has seen the Manpower Services Commission and whether it accepts the cuts that he has announced?
  Mr. Prior: There were plenty of stories going around that we would abolish the Manpower Services Commission. Everyone on this side of the House heard them time and again.
  It is true that I did not consult the whole of the MSC before the cuts were made, although I asked the chairman to carry out what consultations he could at short notice. I was told, quite properly, that what we were asking for was something that the chairman had to take on his own shoulders as there was not sufficient time to consult all the commissioners in full. I have asked him, and I asked the MSC yesterday when I met all the commissioners, to look in full now at our proposals for the years 1979–80 and 1980–81.
  I did not make specific proposals either to the chairman or to the Commission, a month ago or yesterday. I have asked the Commission what it thinks it would be best to cut, given the need to make these schemes as effective as possible and to conform to the Government's public expenditure programme. Therefore, I have tried, so far as is humanly possible, to consult it in advance on a decision which needed to be taken quickly and which involved a certain budgetary content.
  1536
  I am not saying that the MSC would have wanted any cuts, but I think that its members will agree that, bearing in mind the facts that cuts were required, they had a reasonable opportunity to decide among themselves where the cuts should fall, and they will have an even greater opportunity of coming to decisions for future years.
  The electorate had the clearest choice that they have had for many years. They knew precisely what we were going to do about the expansion of these programmes. Having had that carefully explained to them, they voted in large numbers for the policy that we are now adopting.
  In this matter one should not consider just the schemes of cash aid. The policy of the previous Government and their legislation over the previous five years have had a debilitating effect—the Employment Protection Act, the Dock Work Regulation Act, the failure to support small businesses and the effect of the Employment Protection Act on small business confidence—as Mr. Harold Lever used to say, somewhat disloyally, when he was sitting on this Bench. The previous Government had a dogged persistence in the belief that everything they did was right, when even their own supporters were telling them that they were wrong.
  We are entitled to ask what they would have done. Are they saying, as the right hon. Member for Chesterfield seemed to imply today, that they would have kept entirely to their public expenditure plans for the coming year? If so, what they are really saying is that they would have to find an extra £2 billion from direct taxation, from an increase in VAT or perhaps from a tax of which they were very fond—the employers' insurance surcharge.
  They raised that surcharge twice before. The jobs lost as a result totalled far more than the jobs that they saved by paying out under their job creation schemes the money they had taken from employers.
  Mrs. Kellett-Bowman: Is my right hon. Friend aware that the previous Government put their poll tax on employment at precisely the time when the other countries of Europe were reducing

  1537
  the tax on employment for firms in difficulties, such as the textile industry, thus putting us at a further disadvantage?
  Mr. Prior: My hon. Friend is absolutely right. That has added to our unit costs of production. The result of that and of keeping our VAT rates low is another reason why we have been sucking in so many imports. Not only have one or two other countries in Europe stopped piling extra costs on employers by way of social insurance, and so on, but Sweden, for example, has started to reduce those costs a little—though, granted, from a higher level than ours.
  This is the question that Labour Members must answer: from where were they going to get the money to provide the extra schemes that they accuse us of cutting? Would they have done it through the employers' insurance surcharge, by VAT increases, by further cuts in public expenditure or even by increased direct taxation? All that has been tried before and it has failed. The failure is plain for everyone to see.
  It is not just the unemployment that we have now which is important, but the trade figures, the import of manufactured goods, the uncompetitiveness of so much of the British economy and the holding back over the past few months before the election of a number of decisions on steel and shipbuilding, which the right hon. Gentleman knows had to be made and should have been made earlier.
  All those are part and parcel of the previous Government's policies which failed. It is no answer for the Opposition to put down a motion on unemployment and this Government's policy on cuts when their policies of the past five years have so abjectly failed. Memories in politics are short—perhaps that is a good thing—but I hope that the Opposition will allow a decent period to elapse before they again show the hypocrisy that they have shown by putting down this motion. I ask the House to reject it.
  5.17 p.m.
  Dr. David Clark: I am pleased to be back in the House after an enforced gap of five years. I should like to pay a brief tribute, with which I am sure hon. Members will want to be associated, to my predecessor, Arthur Blenkinsop. He was in the House for
  1538
  almost 30 years. We knew him as an assiduous and conscientious constituency Member. But, more than that, he had a national reputation in matters of recreation, the arts, amenities and the Health Service. That reputation not only was well-founded but commanded much respect.
  I have inherited from Arthur Blenkinsop a constituency with many problems—problems which will be made much worse by the Government's policy of cutting the budget of the Manpower Services Commission. I know that the Minister has been to the North-East and seen some of the problems at first hand, but I want to explain how my constituency's problems will be compounded by the Government's measures.
  A DHSS report in 1976 described my constituency as one of the 10 most deprived constituencies in the country. The Northern region strategical team reported in 1977 that South Tyneside was the most deprived district in a region not noted for affluence. Underpinning all this poverty and difficulty is the tremendous problem of unemployment. As the Minister said, unemployment was an issue in the election campaign. In fact it was the issue in my constituency, where 2,000 more people voted Labour than in 1974. That shows that they had more confidence in the previous Administration in this respect than in the present one.
  I might be wrong about that, but I remind the House that I am talking about unemployment, on the latest figures, of 12·8 per cent.—two and a half times the national figure, and almost twice the figure for the Northern region. Male unemployment is 15·7 per cent.; almost one man in six in my constituency does not have a job. I note, too, the Government's policies and reflect that the two big employers in my constituency are shipbuilding and local government—both subject to restrictions, or impending restrictions, by the Government. The decision announced yesterday that the Shell-Esso vessel is to be built in Finland does not augur well for the shipbuilding areas.
  I hate to prophesy, but I fear the events of the next 12 months. I pray that I may be wrong. I cannot see male unemployment being less than 20 per cent. in the South Tyneside area. Hon. Members will understand my concern. I do not

  1539
  accuse the Secretary of State of callousness. I believe that he is genuinely shocked by what he has seen in some of the regions. I do not say this carpingly, but I believe that some of his hon. Friends would do well to see the problems that exist in some of the deprived parts of the country. I did not appreciate them until I went there. Those problems are reflected in the savage and tragic unemployment among young people.
  During the election campaign I was, in a sense, heartened to meet many youngsters who were employed under the youth opportunities programme, often in social services, sometimes in industry. I went out of my way to talk to the young people. They all said that they would much prefer to do a job than to be on the dole. The success of this programme was such that in South Shields I met only two people at the time of the election who had been on a youth opportunities scheme and had not been fixed up with a job. That shows the value of such a scheme. However, we still have 750 young people unemployed in South Shields.
  I have listened with care to what the Minister said, and I welcome the fact that cutbacks are not to be made in areas such as South Shields. I note that in the press release issued by the Department it was said that there will be some shift to wards cheaper schemes and some curtailment of the duration of programmes. This will reduce the quality of the various schemes. We feel that in areas such as mine this will have an effect on the services offered by the Manpower Services Commission. We deeply deplore and fear such cuts.
  We also fear the effect of the Buudget. I give notice to the Government that I intend to be a thorn in their side on this issue and intend to prick their consciences. We are talking about one in five of the males being out of work in areas such as mine. It was 50 years ago when the hon. Member who at that time represented the constituency next to mine—Jarrow—led a march to London. I hope that I shall not have to take such measures. We are not asking for the earth. We are not greedy people. All that we want is to have a share in the affluence that we see in certain parts of the country. What we seek can be best summed up in the words of a pitman-poet from South Shields, a man who later was
  1540
  to grace these Benches for 20 years, Joe Batey. He wrote in a poem at the turn of the century:
  "We do not ask the earth; only that portion of its plenty that is ours."
  That is what we want in areas such as South Shields.
  5.25 p.m.
  Mr. John Butcher: I compliment the hon. Member for South Shields (Dr. Clark) on his return to the House and on his speech on an issue about which he feels strongly. I share his concern. I hope that we shall be discussing similar issues across the Floor of the House on many occasions in the coming years. Unemployment is inevitably an emotive issue, and hon. Members differ strongly on the methods by which it may be reduced or its effects ameliorated.
  I have been fortunate enough to catch your eye this afternoon, Mr. Deputy Speaker, and I am sure that if the previous hon. Member for Coventry, South-West were present she would be anxiously trying to catch your eye, too. She cared deeply for the plight of the unemployed. I refer to my predecessor, Mrs. Audrey Wise. Her views on society were totally different from mine. Some of her methods were different from those which I shall pursue. However, in this House an hon. Member is always respected for having the courage of his or her convictions. She worked hard for all those constituents who needed help, and she was assiduous in her attendance here and in her duties in this place. During the election campaign Mrs. Wise and I shared a platform on three occasions. She debated the issues, including unemployment, without rancour.
  Coventry, South-West is not a constituency which can be described as average or typical in any sense. It contains an above average proportion of skilled industrial workers. It has above average owner-occupation and an above average percentage of trade union members. Most of the university of Warwick is within its boundaries. It is good for the political soul of a new hon. Member to have a large group of young idealists on his doorstep.
  On the university campus there are many fringe groups which I can only describe under the collective umbrella of

  1541
  the "Enid Blyton Left." In the mainstream there are the Federation of Conservative Students and the Young Socialists—the Labour club. I am bound to report that the Labour club has a football team called Workers United. I am further bound to report that Workers United beat FCS 6-0 last year and 4-0 this year. This represents a swing of 17 per cent. to the Conservatives.
  The recent history of the city of Coventry is also different from that of most of our cities. When the city centre was destroyed overnight by bombing, Coventrians started afresh. They built a new and beautiful shopping centre and so rejuvenated the local economy that it was nicknamed "The Klondyke" in the 1950s. Today 186,000 people are employed in the area, together producing export goods to the value of £250 million per annum. That is £1,344 of exports per head of the working population. If that figure had been repeated nationally we would be debating here the happy issues associated with economic success rather than, as is, sadly, frequently the case, our recurring economic crises.
  There are clouds on the horizon. Coventry's strengths are also her weaknesses. I refer to the unusually high proportion of the work force which is directly employed in manufacturing. There is an over-dependence on a small number of large employers, and there are the possible effects of the silicon chip revolution on a city which, more than any other in this country, is dependent on the repetitive assembly of engineering and automotive products.
  That brings me to the terms of today's debate, the role of the Manpower Services Commission and other public agencies in dealing with the now rapidly accelerating changes in the pattern of employment. There is now a national acceptance that public expenditure deliberately boosted to increase employment suffers from its own law of diminishing returns. The revenue-raising implications of a job artificially created may cause a job to be lost in a hitherto profitable company. Ameliorative measures are precisely that. They do not solve long-term problems or provide long-term jobs.
  1542
  The Manpower Services Commission has an important role to play in keeping unemployed youngsters "job-fit", as we call it, and in keeping its training and placement programmes responsive to the needs of local employers. Value for money also is essential, and I am delighted to report to the House that this is precisely what is being provided by the MSC in Coventry.
  Compared with last year, we shall lose 100 places on the STEP schemes, which is unfortunate, but the youth opportunities programme will be expanded. There were 3,000 starts on YOP projects last year. There will be 4,500 starts this year. It must be remembered also that last year's budget for the MSC was based on a higher level of occupancy than has so far been achieved.
  On behalf of the young people of Coventry I thank my right hon. Friend the Secretary of State for Employment for recognising their problems in the most tangible way possible, and I am sure that they will respond with enthusiasm and dedication.
  There are 11,916 unemployed people on Coventry's register, yet there are still great shortages of labour, particularly of skilled workers. The engineering employers require technicians of all kinds, and there are vacancies for draughtsmen, designers, work study engineers and process planners. Measures have therefore been taken to increase co-operation between the local education authority and the Coventry engineering employers' association on the means by which education can become more sensitive to the needs of local industry. In responding to the changing patterns of employment, further education departments of local authorities will have an increasing role to play, and it may be that within education budgets a shift of resources into further and adult education will become inevitable. As training and retraining become more important, a blurring of the lines of responsibility between Departments of Government at both national and local level may take place.
  I am not arguing today for a reallocation of resources between Departments, but I hope that the recently announced changes in the MSC budget mark the beginning of a rationalisation and a fresh

  1543
  national approach which will take advantage of existing skills within the Department of Employment and the Department of Education and Science, to the benefit of all those seeking work.
  It used to be said on Birmingham city council that there were three main political parties—the Labour Party, the Conservative Party, and members of the education committee. For six years I was a member of that council and took a special interest in further education. For nine years I have worked in the computer industry, and I hope that the House will therefore understand why I cannot let today's debate pass without a brief mention of the effects that the silicon chip will have on future employment patterns and life styles.
  In Coventry and the West Midlands microprocessors are of special interest because the very nature of our industries will dictate their utilisation if we are to remain competitive, but this will not take place without our taking cognisance of our new social responsibilities.
  Every 16-year-old leaving school this summer will probably need complete retraining on three or four occasions in his working life on his way to retirement at the age of 50. Changes in policy on redundancy payments may be necessary to encourage the investment of those payments in new ventures. If spectacular increases in efficiency are achieved, we may have to rewrite the economic textbooks, particularly those sections dealing with surplus wealth. If there is to be surplus wealth sloshing around the economy, it could be used to assist future Governments in promoting cheap money policies for borrowers. We may be able to look forward to the day when there is one highly paid wage earner per family, a day when we may remember the latchkey children as an anti-social phenomenon of the 1960s and 1970s.
  If a man or woman is working a four-day week, leisure pursuits will take on a larger significance in our lives. With more leisure and more time to make buying decisions, society could become more acquisitive—not just in the sense of acquiring consumer goods but in the sense of acquiring compassion. A family with more time together and more money can also afford to care for the aged, the disabled and the disadvantaged. I hope that we shall see an acceleration
  1544
  of the trend to family-based care, reinforced by Government policies, and a continued change in the direction of resource allocation away from institutionalised care towards home-based provision.
  I am aware that for centuries Members of Parliament have seized on a single technical breakthrough to project and predict earth-shattering economic changes. In many instances it just has not happened. That may be the case with the silicon chip, but I doubt it. The revolution is already under way, and its effects will be as profound as those of the coming of the railway age in the last century. There is a danger that its advent will polarise economic opinions. For example, surplus wealth may be the catalyst which permits large numbers of people to become self-employed, or, alternatively, it may be used to generate an increase in the number of workers' co-operatives.
  The driving force for wealth creation must continue to be capitalism. The economic atmosphere must be one of enterprise and value for money from State agencies. In this way, and through a mixed economy, the quality of life can be truly enhanced for all sections of the community.
  I have a rough idea that this is the sixty-third maiden speech to which the House has listened in the past few weeks. I thank you, Mr. Deputy Speaker, for your indulgence, and I thank the House for its customary courtesy on this occasion.
  5.38 p.m.
  Mr. David Alton: I congratulate the hon. Member for Coventry, South-West (Mr. Butcher) on his maiden speech. He remarked that there were three parties on the Birmingham city council. I am glad to assure him that there are three parties in this place, and in congratulating the hon. Gentleman and making my contribution to the debate I am happy to speak from the Liberal Bench. The hon. Gentleman's speech, I thought, proved that even in the computer industry there is feeling and heart, for his words demonstrated concern for the genuine plight of the unemployed and his anxiety to remedy the problems of his constituents. I am sure that the House will hear many more speeches from the hon. Gentleman, and, if they are of the quality

  1545
  of the one which he has just delivered, it will not tire of hearing from him.
  I wish now to refer to the situation on Merseyside in discussing both the subject raised today by the Opposition and the state of affairs created by the Budget. Hon. Members may well have seen the report in The Observer last weekend which said:
  "Treasury forecasts that unemployment will rise to 2 million and that inflation could reach 20 per cent. next year have been suppressed because of their acute political sensitivity."
  Sensitivity is required when we talk about unemployment, and any Budget which allows the growth of unemployment is for that reason unacceptable. It is probably more important to talk about the massive scale of unemployment in terms of the Budget presented last week than in terms of the continuation of the Manpower Services Commission, important though that body may have been.
  It is not a matter of people saying that they will not work. They cannot get work. They cannot work. I deplore the attempts made from time to time to suggest that people, particularly on Merseyside, are workshy. That has never been my experience, and the 100,000 people out of work on Merseyside, some 11 per cent. of the population, will deny that that is so.
  In parts of my constituency of Edge Hill, there are about 30 per cent. of people out of work—an amazing figure when set alongside the national average of 5·2 per cent., about 1,238,000 in all. It demonstrates the difference between North and South and the difference between the hardbitten industrial centres and the more well-endowed areas of the South-East.
  I am worried by the growing number who are unemployed for long periods. Over 955,000 have been unemployed for periods longer than four weeks. Many of those remain unemployed for periods far longer than that. They have more and more difficulty in obtaining employment as the years go by.
  Against the background of such largescale and long-term unemployment, we must consider with a certain amount of scepticism the schemes provided through the Manpower Services Commission. At the end of April it was estimated that 63,000 had been assisted by temporary
  1546
  employment subsidy schemes. There were 11,200 assisted by the short-time working compensation scheme, 370 by the temporary short-term working compensation scheme, 27,600 by the small firms employment subsidy, 22,900 by the job release scheme, 870 by the adult employment subsidy scheme, 190 by the job introduction scheme, 70,000 by the youth employment scheme, 5,200 by the community industry scheme and 14,500 by the special temporary employment programme, 26,000 by the training places supported in industry scheme, a total of 242,000. That is only a drop in the ocean when taken in the context of 1,238,000 unemployed.
  We all deplore the cuts made in the Budget introduced by the Chancellor of the Exchequer last week. I will give three examples. The youth opportunities programme has been cut by £52 million from £200 million. The STEP programme has been reduced to £42 million from £80 million and the TOPS programme by £22 million from £200 million. That is something with which we are all concerned. Even though the schemes have sometimes been merely palliatives, and even though we have been putting only poultices on the problems, nevertheless the schemes have made some contribution to the problems of the unemployed.
  We should embark on ways of resuscitating the economy. Instead of creating quangos like the MSC as we did in 1973, expanding bureaucracy, coming close to setting up alternative education systems and getting into competition with already bureaucracy-filled local govenment, it would be far better to return the functions of the MSC to local government and let it get on with the job. The Association of Metropolitan Authorities proposed that action a few days ago. We would do well to listen to it.
  We must consider carefully the effects of the Budget in terms of real employment within local government. I do not mean temporary employment schemes where people are given a short-term stay of execution. Many unemployed are taken off the dole queue only to be placed back on that scrap heap within a very short period. With certain schemes once a person has been employed for one year he is thrown back on the scrap heap without the opportunity of remaining in employment via that scheme.

  1547
  That is not true of local government where many jobs are under threat because of the cuts announced by the Government in rate support grant, and because the previous Government failed to operate a proper prices and incomes policy. The result has been that local authorities are nowhere near the 5 per cent. targets laid down by the previous Secretary of State for the Environment.
  In Liverpool, for example, there is a £5·4 million deficit to meet within the current financial year. That has been totally occasioned by wage increases and a failure by the previous Government to comply with their own pay guidelines.
  Local government is expected by the present Government to remedy that. This Government have told local government to prune its expenditure. In Liverpool alone the effect of that policy this year will be to make necessary 1,841 redundancies within the local government structure, and next year a further 743 redundancies.
  That is totally unacceptable. What choice will local government have if the rate support grant is not reviewed to take into account the terrific wage settlements that have been reached? The manual workers' award from 30 October this year—building workers, for instance—is an increase of 14·8 per cent. instead of the suggested 5 per cent. Social workers have received a 22 per cent. award. From 1 April teachers averaged a rise of 10·7 per cent. Comparability awards for manual workers have resulted in increases of about 5 per cent. and there will be further increases later in the year.
  The effect of that is that the Liverpool city council has to find an additional £13 million. There are grant-aided subsidies that will reduce this amount, and by savings that can be made within the authority the total amount of the deficit will be about £5½ million.
  The real effect on the employment of local government workers will be disastrous. It will mean that many more will end up in the unemployment queues.
  No one can suggest that a superficial debate on the MSC reaches the crux of the problem of unemployment.
  All hon. Members accept that unemployment is a problem that affects not only Merseyside and the country as a whole. It is a crisis that the whole of
  1548
  the Western world will have to face. The hon. Member for Coventry, South-West was right to refer to the problems posed by new technology, the advent of the micro-chip. There will be major problems.
  More thought must be given to work-sharing schemes and a fairer system in our industries that will result in the creation of more jobs. Until we give proper incentives through profit-sharing schemes, we shall not see the creation of more jobs within industry. Why should employees bother to work harder if that merely means putting more money in the employer's pocket? That is especially true if the employer is the person who will gain most from the tax reductions introduced in the Budget. If proper incentives had been provided for workers at the lower end of the scale, the Budget might have been greeted with less acrimony by many workers.
  We are in a position where, without a proper prices and incomes policy, we shall embark on something close to free collective chaos. That will result in the loss of more and more jobs.
  The Budget is a recipe for more unemployment. It will hit areas such as Merseyside even harder. It will sabotage the work that has been done by organisations representing small business men. Last year alone the Council for Small Industries in Rural Areas advanced loans of £3·46 million, creating 1,700 permanent new jobs. That is far more beneficial in the long term than any number of manpower services commissions, job creation programmes, or any other palliative.
  It is important that the Government pay proper attention and care to the creation of long-term jobs and do something about reducing massive unemployment that will only be accentuated as a result of the disgraceful cuts made in rate support grant and the way that they will hit local authorities.
  5.50 p.m.
  Mr. Mark Wolfson: As I rise with trepidation to make my maiden speech I am reminded of my first speech-making efforts when I worked for the Industrial Society. I spoke to an interested industrial group at a university. I was given a good dinner. I spoke to those present. We had a discussion, which was

  1549
  open and full. I hope that I answered their questions reasonably well, as most of us do at the conclusion of such evenings. When I left, the young lady treasurer said to me "Mr. Wolfson, what is the fee that we should settle?" I said "There is no fee. The Industrial Society happily pays for this." She said "What about expenses?" I said "There are none of those either." She said "We have been lucky this year. None of our speakers asked for fees or expenses." I remarked that the society's balance sheet must be looking healthy. She replied "Yes." I said "What will happen to the surplus?" She said "Next year we shall offer far higher fees and obtain the services of much better speakers."
  Fortunately or unfortunately, there is neither bonus nor fee involved here. There is a flat rate for the job. In spite of today's news, the rate is still far too flat. We shall all be running to stand still. The Boyle recommendation of a salary of £12,000 for Members of Parliament is fair but not over-generous. Its implementation should have been more rapid. The present basic pay of under £7,000 per year for this job is derisory. It is time that Britain, which rightly expects much from its Members of Parliament, came more into line with our European neighbours. The time to do so will never be sufficiently propitious. It will take the courage of all Members of Parliament. We shall have only ourselves to blame if the proper rate is not paid for a proper job. Perhaps, in view of the Government's emphasis on productivity-based deals in wage negotiations elsewhere, we should apply the same criterion here. As a newcomer, my mind boggles at the possible consequences. Paid on the basis of words delivered in the Chamber, how many more Government supporters would gladly pop up to intervene, to question, or make speeches? How many members of the Opposition would follow the example of their hon. Friends sitting below the Gangway and wield a sledgehammer to serve a double winner? We should be here night and day and every weekend.
  I wish to refer now to my predecessor who, for nearly 30 years, represented Sevenoaks. In his maiden speech Sir John Rodgers spoke in detail and from
  1550
  a background of much knowledge about the problems of newsprint supply in postwar Britain. The then President of the Board of Trade replied. Sir John's speech cast an interesting light on Britain 30 years ago. Our newspapers consisted of six pages. In France they consisted of between 12 and 18 pages, and in Belgium of between 12 and 16 pages. Indeed, Sir John said that all the countries in Europe, except Germany behind the Iron Curtain, were better off than ourselves in that matter. Comparisons like that have a familiar ring in many other cases today. I have a feeling of dèjàvu. That speech marked the start of a long and worthwhile career in this House. Sir John Rodgers will always be remembered as one of the pioneers of the European ideal, to which he gave much time and energy. As his successor in this house, I salute him.
  The constituency of Sevenoaks is more varied than hon. Members might at first suppose. It has some urban pressures. It has much lovely countryside. My constituents travel by train and car to London, but many work locally in new and growing industries. Community life in the villages and towns is markedly active. Voluntary work by busy working people is much in evidence. I look forward to working here on my constituents' behalf.
  Sevenoaks possesses two historic houses, Chartwell and Knowle, which are both owned by the National Trust. There is also Penshurst Place, which is still in the hands of Lord De L'Isle. That is a family trusteeship held from Elizabethan times. I shall speak out in favour of retaining our national heritage in the continuing trusteeship of those families who own and love their homes. Once such houses are open to the public, everyone gains from the care, attention and individuality that such ownership brings to this show of living history. Nationalisation and municipalisation provide no benefit except dull uniformity and higher cost. Partnership between Government and owner, the nation and the public, is the best way of ensuring that we in the present and those of the future benefit most from those who have gone and who worked before.
  Now to the business of this debate. Already I have learned the value of hearing in this Chamber about the specific

  1551
  problems of other hon. Members' constituencies and how legislation has affected—or, they fear, may affect—their situation.
  The planned reductions in the budget of the Manpower Services Commission are opposed by members of the Opposition because they argue that they will be detrimental to the prospect of jobs for the long-term unemployed and young people. I speak from some experience of work with young people. For some years I was warden of Brathay Hall, a training centre in the Lake District providing development courses for young men and women from industry and commerce. I remain a trustee of that worthwhile operation. Brathay Hall has benefited in kind from the job creation scheme, in the form of a restored Lakeland barn, now providing additional training facilities. That was opened two years ago by the right hon. Member for Barrow-in-Furness (Mr. Booth) when he was Secretary of State for Employment. Later I worked with the Industrial Society in running its campaign to improve the development and training opportunities for young people at work. As a practising personnel director I am much involved in the practical decisions of business on whether to create new jobs. My point is that it is at the practical working level, the sharp end in business, that the decisions on the retention or otherwise of present jobs and decisions on the creation or not of new jobs will always be made.
  The Government, except in a totally controlled Socialist society, can only set the scene. If real, long-lasting and secure jobs are to be created, and it is crucial that they are, business men must have the confidence to create them. The whole strategy of the Budget is based on providing a backdrop against which that confidence can grow. The Budget measures are the first step. Some changes to the Employment Protection Act will be the second, changes to trade union law the third, and the cutting of other controls and red tape imposed on industry is the fourth. That is the kind of package that those who run businesses, those who will have to make decisions about expansion and new jobs, have been looking for.
  The Manpower Services Commission special employment measures have helped, and will continue to help, to plug the gap. It is important that the House and the
  1552
  country appreciate, first, that the cuts are made into the already planned Budget growth; secondly, that the special employment measures continue and are concentrated in those areas and on those individuals whose needs are greatest; thirdly, that the Government are as much concerned as any Opposition Member about the deeply serious effect that unemployment has on individuals and on families, be they young or old.
  Unless the decision-taker, in his or her business—be it the director, manager, owner or a self-employed business man—decides to expand and takes the risk to go for a wider market, there never will be the extra jobs that this country so desperately needs and will need in the future.
  All the experience I have gained from those to whom I have spoken in my constituency and from my time in employment, tells me that high personal taxation, higher employers' contributions, some aspects of the Employment Protection Act, increased form-filling and reporting procedures—all of which have increased during five years of Labour Government—have militated against that very business confidence which is the only way to achieve long-term job security and new long-term jobs.
  We on the Government Benches certainly see a continuing and crucially important role for the Manpower Services Commission in retraining, helping to deal with problem areas and helping those who are specifically disadvantaged because of the changing job scene. The future prospect of changing technology in Britain need not be all gloom. There is the alternative of brighter prospects, more opportunity and a more leisurely life. Given the right challenge, which we ask them to take up, there is no reason why business men, successful, profitable and confident in the Government's long-term intention, should not do much to deal with the problem of unemployment which we are discussing.
  I hope that I have stayed within tradition in talking about my constituents and my predecessor. If I have strayed a little outside tradition in making some statements that are, perhaps, controversial, I thank Opposition Members for their kindness in bearing with me. I do not expect them to bear with me so easily in the future.
  6.7 p.m.
  Mr. George Park:I congratulate the hon. Member for Sevenoaks (Mr. Wolfson) on his maiden speech. We look forward to his future contributions to our debates with interest, although, as he himself remarked, I doubt very much whether we shall be quite so easy on him next time. However, I regard it as a hopeful sign that in this very short debate two Members from Coventry caught your eye. Mr. Deputy Speaker.
  I should also like to congratulate the new hon. Member for Coventry, South-West (Mr. Butcher). It is quite clear that he has come to grips with that constituency. I appreciated his kind remarks about my former colleague. Mrs. Audrey Wise.
  I echo the hope of the Secretary of State that we will be given further opportunities to discuss this subject. At this early stage in the life of the Government it may be understandable that most of the responses we get sound as if the Government are saying "We have a mandate". Alternatively, we are given bromide answers.
  Sooner or later, Ministers will have to give specific answers to matters arising out of their own policy decisions. The Government would be treading on very dangerous ground if they imagined that they had been given not only a mandate but a blank cheque. This is particularly true of their intentions towards the Manpower Services Commission. It is not sufficient, as has been said by many hon. Members on the Government Benches, not least the Prime Minister, to dismiss the activities of the MSC by saying that it is not providing real jobs.
  Whatever the state of the economy, new technology will demand that training and retraining assumes even greater importance if we are to cope with the mismatch between the skills or qualities available, or capable of being developed, in the labour force and the skills which employers need and can afford. Training and retraining should be a growth industry. In this context, the reductions in the budget of the MSC can be regarded only as a retrograde step.
  In Coventry specifically—and I am not as sanguine as the hon. Member for
  1554
  Coventry, South-West about the situation—we shall receive no help under the special temporary employment programme—STEP. We have yet to assess fully the impact of national reductions in the youth opportunities scheme, bearing in mind that £52 million will be taken out of a £200 million gross figure. If we are to assess the impact of this cut on Coventry, we need to know what is meant by the statement that provision will be shifted towards less expensive opportunities, what are the reductions in time for which young people remain in the programme, and whether it will be concentrated in designated areas. We need answers to those questions because we are told that those are the ways in which the reduction is to be achieved.
  In April 1979, 1,100 young people in Coventry were engaged on programmes funded by the MSC, out of 2,900 unemployed aged between 16 and 18. The situation that will face 4,000 children who are expected to leave school this summer will be made even more difficult. It is important to stress that Coventry may once have been known as the Klondyke, but that is very much in the past tense now.
  Nationally, we are expected to believe that community industry can have a reduction of £1 million and still expand. Nor have we been told as yet what is the estimated effect of taking £22·3 million out of the £200 million in the training opportunities scheme, or nearly £10 million from the industrial training boards.
  Even in the small firms area, which the Government say they support, this subsidy will no longer be available in Coventry. I do not know what we have done. We are in Coventry. We cannot be sent to Coventry. We are there. But we suffer this effect all the time when it comes to Government support.
  For those who doubt the value of the schemes sponsored by the MSC, let me give just one example. Of 160 youngsters who have taken part in work experience schemes at GEC Telecommunications, 90 are now working full-time for the company and a further 20 have been placed in full-time jobs.
  Conservative Members have said time and again that uncertainty is the enemy of confidence; and confidence is essential

  1555
  to success in any endeavour. The Government must, therefore, remove any uncertainty as to the effects of their policy decisions on the MSC and, in particular, its Coventry context.
  I realise that it does not come within the responsibilities of the Secretary of State for Employment, but the uncertainty about the future of the National Enterprise Board adds to the anxiety in Coventry, where one-fifth of the manufacturing work force are employed in companies funded by the NEB.
  The fact is that since 1975 more than 78,000 people have been helped in the West Midlands by the MSC in an attempt to counteract the decline in job opportunities in our more traditional industries. But, if the Government do not like and want to curtail the present activities of the MSC, are they prepared to sponsor and encourage jobs in new industries, to which reference has been made, or in the overstretched public services or in industrial activities which are concerned with providing for home consumption rather than exports?
  Although the Secretary of State indicated at Question Time on Tuesday that the West Midlands would need to pull itself up by its own bootstraps, is he prepared, as far as it lies within his responsibility, to support the suggestion of the economic planning council to set up a West Midlands industrial centre to channel the scientific and technological resources of our universities and polytechnics into the region's industrial future?
  If clear answers are not forthcoming, we can only assume that the Government are intent on returning to a nineteenth-century philosophy which ignores the fact that, politics aside, the march of technology will bring social consequences which a market economy is not geared to cope with; and their mandate will come to an end.
  6.15 p.m.
  Mr. Alan Haselhurst:I am happy to be the first speaker from the Conservative Benches to compliment my hon. Friends the Members for Coventry, South-West (Mr. Butcher) and Sevenoaks (Mr. Wolfson) on their admirable maiden speeches. Both of them delivered their speeches with con-
  1556
  siderable effectiveness and revealed, in their individual ways, that they were speaking from deep experience of the matters we are discussing this afternoon. I have no doubt that the Government side of the House has gained greatly by their arrival here. We look forward to hearing their contributions on future occasions.
  I am tempted to take up for a moment or two the remarks with which my hon. Friend the Member for Sevenoaks prefaced his speech, remarks about another subject which has been raised today, but I shall refrain from doing so, Mr. Deputy Speaker, lest I should incur your disapproval. Therefore, I turn to the substantive matter before us.
  In the debate on the Gracious Speech, I said that I wondered how long it would be before the Opposition suddenly discovered something extremely iniquitous in the level of unemployment in the country. It has not taken them long. After only six weeks or so out of office, they are now able, apparently, so far to forget the period for which they were responsible that they can put down a motion which is critical of the Government over unemployment. It requires considerable audacity for Labour right hon. and hon. Members to choose this subject so early in their life as the Opposition.
  In any case, I have absolutely no difficulty in rejecting the motion simply opposing the Government's decision
  "to reduce the budget of the Manpower Services Commission which will injure the prospects of jobs for the long-term unemployed",
  because I do not think that this is what lies at the heart of the unemployment problem. The Opposition's fire is misdirected if they believe that the action taken by the Government will be seriously injurious to employment.
  What matters most concerning employment prospects is the health of the economy and the conditions for employment generally in the country. I have no doubt that the Government are right in their approach on taxation and with respect to amendments to the Employment Protection Act to encourage employment.
  We have debated on other occasions what it is that persuades employers to employ more people. There has been dispute between the two major political

  1557
  parties. But it still remains my clear conviction, gained from talking to many employers, that the conditions that existed under the previous Government were acting as a directly inhibiting effect on employers' taking on more people. I am now hopeful that the changes that are being made in taxation and in the Employment Protection Act will create a new climate which will enable more people to be employed without special measures being necessary.
  However, I recognise that the timing is important. I would not pretend for a moment that there will not be an unemployment problem which needs attention.
  Linked with the question of the unemployed is the question of those who are employed but have had no kind of contact with the education service since they left formal education or who have had no kind of training. Any approach must link the needs of the unemployed and the needs of those who are in employment but have received no training. At present, in the age range 16 to 18, about 10 per cent. are unemployed, but 37 per cent. are in work but without any kind of training. Those two matters must be examined. It is on that basis that we construct a sensible programme for dealing with the residual problem of unemployment.
  I am concerned that the Opposition should concentrate their fire on action taken by the present Government with regard to the MSC. One of my worries about the proposals that came forth from the previous Government is that they proposed one idea after another as a temporary measure, without any real rationale behind it. Most of the measures that they introduced were called temporary, and there is no doubt that the Labour Government did not believe that the unemployment they faced would last for very long.
  It is not necessary in showing one's concern about unemployment to defend to the last degree all the measures introduced by the previous Government. Those measures were brought out one after another and did not always link up. The programme for dealing with the unemployed or those with inadequate training was not coherent or rational. We must adopt a different approach. Shaving
  1558
  money from the Manpower Services Commission does not necessarily directly harm the prospects of a more positive and sensible programme for dealing with such people.
  I shall consider first careers. It is difficult to speak about that subject without crossing departmental boundaries. Not enough is done to help people to choose the job for which they have the greatest aptitude and in which they would be happiest. The attention of young people is not sufficiently directed to the jobs available in their areas. It is not true that in all areas of the country there are no job prospects. It is alarming that many employers cannot fill posts. Applicants often do not have adequate qualifications for the job.
  There is an antipathetic feeling towards industry which has not sufficiently been overcome. Initiatives have been taken—some by industry itself—to improve industry's image and make known to children at school the kind of jobs open to them. There are, however, insufficient links between firms and schools, and the responsibility lies with industry to try to overcome that.
  Some people in the education service may be a little suspicious, but industry needs qualified people. Local companies can play a bigger part in selling themselves to young people.
  When firms take on new recruits there should be a better induction programme. Often if there is such a programme the induction lasts for only a day or two. It is unsatisfactory in modern industrial conditions to expect people to acclimatise to a totally new atmosphere in such a short period. We must find a better means, through careers training and induction, to help young people seeking employment.
  How is that to be done and how can it be financed? The Government are not solely responsible. I agree with my hon. Friend the Member for Sevenoaks that the Government's responsibility is to set the scene. I hope that the measures taken by the Government will do just that, but the various schemes produced under the special programmes of the Manpower Services Commission do not add up to a suitably coherent programme.
  It is disappointing that the Commission's schemes—and in particular the youth opportunities programme—lack

  1559
  educational or training content. The majority of places are allocated to on-the-job training courses. The amount of educational training is small.
  I question whether the Commission is spending money sensibly. It seems to be falling well short of providing for a well-trained work force. Many industrialists would say that there have been enough demands on industry, but it should play a bigger part in training the young people whom it will need in the future.
  We must find the right connection between the education system and life at work. That is important at present. People will then be trained to do the type of job that is available and will be able to understand the environment in which they are to operate.
  Industry must be brought much more into the training process, and its contribution must be increased. Not everyone will be able to work in industry because of the effects on manufacturing of such technological developments as the silicon chip. Manufacturing industry will employ fewer people in the future, although that still leaves plenty of opportunity in service industries. Not everyone can look forward to training in a skill related to manufacturing industry. We must consider how people can be trained to do the jobs that will be available and be given the skills to cope with the general problems of industrial life as adults.
  The role of the voluntary organisations should be given more consideration. The Manpower Services Commission was used by the previous Government to operate a series of special programmes. It largely bypassed the bodies that existed and that might have contributed to the training. The role of those organisations should be reassessed, because many could provide courses that would be relevant to youngsters who cannot acquire skills for a career in industry. That is the direction in which the Government should be looking. The Government should not nail their flag to the Commission and say that all its work is automatically right and that any adjustment will harm the unemployed.
  There must be a new approach if we are to have a well-equipped work force to deal with our future needs. I recognise that there is a problem of managing the balance between the numbers of people seeking employment—which will rise in the next few years—and the number of
  1560
  jobs available. To judge by the nature of the jobs that will be available, more training will be required. That may mean delaying the commencement of full-time employment until youngsters are equipped properly and effectively to do the jobs available.
  If the Government base their approach on that kind of thinking, they will do the best service they can to the unemployed and untrained. It is better to adopt that line of action than simply to accept what the Government inherited and say that it is so good that it cannot be changed.
  6.28 p.m.
  Mr. Arthur Davidson:I am concerned about the effects of the cuts to which the right hon. Gentleman has referred on an intermediate area such as North-East Lancashire. It has long been a bone of contention that North-East Lancashire has not been given development area status. It is a criticism that I have made to successive Governments.
  Aid has been concentrated in development and special development areas, although measures such as temporary employment subsidies and STEP have been invaluable to North-East Lancashire in creating and maintaining jobs. Without those measures, the differential between areas such as North-East Lancashire and those with development area status would be further widened.
  I believe that the Secretary of State was making a mistake—one that has been made by successive Governments—in viewing the problems of an area purely and simply on the unemployment statistics. There are certain areas, such as North-East Lancashire, which have particular problems, notably the drift away of young people, so the unemployment statistics are not a true and accurte assessment of the problems of the area.
  I hope that the right hon. Gentleman will be flexible and will not concentrate aid on development areas and special development areas to the exclusion of areas such as North-East Lancashire.
  6.31 p.m.
  Mr. John Golding:I warmly welcome back to the House my hon. Friend the Member for South Shields (Mr. Clark), who delivered his second maiden speech in a courteous manner. I was also pleased to hear the speech of the hon. Member for Liverpool,

  1561
  Edge Hill (Mr. Alton) and those of the hon. Members for Coventry, South-West (Mr. Butcher) and for Sevenoaks (Mr. Wolfson), who made contributions that were such that we shall listen to them with great interest in the future.
  I am sorry that my hon. and learned Friend the Member for Accrington (Mr. Davidson) did not have time to develop his argument about the problems of the intermediate areas. Had he done so, he would have done credit to the subject, as did my hon. Friend the Member for Coventry. North-East (Mr. Park). I was interested to hear from the hon. Member for Saffron Walden (Mr. Haselhurst), but I wondered why he did not echo the severe criticisms that he heard the other evening from the British Youth Council. I wondered why his defence of the Government was not delivered face to face to the representatives of the council, who are in the House today. We are debating these cuts which are an act of social vandalism.
  Mr. Haselhurst rose—
  Mr. Golding:No, I shall not give way. The Government are guilty of putting the boot into the youth opportunities programme and reducing the special temporary employment programme by well over half, stealing it away from many of our constituencies. They are also slashing proposed new places in community industry and cutting support for industrial training. In addition, the cuts have led to the mutilation of both the small firms employment subsidy and the temporary short-term working compensation scheme, as well as the abandonment of the restructuring subsidy.
  I feel like someone who has built something with care and then has to watch hooligans mindlessly smashing his work. That is how I have felt as I have watched the Government in their first few weeks at the Department of Employment.
  Why have the Tory Government done this? Is it because the problem of unemployment will decrease? Of course not. Although it is not clear whether the Secretary of State has seen the Treasury forecast of 2 million unemployed, or whether he agrees with that figure, it is clear that he expects unemployment to rise. In these circumstances, I would have expected more and not less effort
  1562
  to be put in to reducing the impact of unemployment.
  That was the attitude of my right hon. Friend the Member for Barrow-in-Furness (Mr. Booth). He saw the Treasury forecasts and made certain, through special measures and through schemes which are now being wrecked, that the Treasury was proved wrong. It is not because the problem of unemployment is less or because the amount of individual hardship will fall. It is not that the economic waste will disappear or that the need to support industrial training will diminish. It is not for any of these reasons that the right hon. Gentleman has succumbed to the pressure from the Prime Minister for £170 million worth of cuts in the Department of Employment group.
  The choice facing the Secretary of State was either his own redundancy or the unemployment of thousands of other people. The Prime Minister, stubbornly believing that the answer to our problems is to make the rich richer still and make those not so well off pay the price, has completely undermined much of the good work done by the previous Government in co-operation with the Manpower Services Commission. This work, incidentally, was generally supported by the Secretary of State when he was in Opposition.
  In pursuing the Prime Minister's policies, the Secretary of State must recognise that he is denying young people the chance that they deserve and that they would have had if Labour had won the general election. The Prime Minister's policy to inflict hardship on so many individuals and families is a savage way of treating so many very vulnerable young people. When the right hon. Gentleman receives the thanks of his rich friends for the tax cuts, may he also hear the curses of those condemned, as a consequence, to unemployment. Those curses will be echoed by the careers service which, together with the Manpower Services Commission, has worked so hard over the last two or three years to give all our young people a fair chance to work at a time of heavy recession.
  I suspect that the right hon. Gentleman does not really believe in the arguments that he puts forward. From time to time he sneers about schemes that we introduced because they were not all about creating jobs. He implies that

  1563
  only permanent job creation is worth while. But in practice he has kept intact the job release scheme, and thank goodness for that. But the job release scheme itself does not create another job. The right hon. Gentleman keeps other schemes as well which do not create jobs, even though he has not kept them intact. I refer here to schemes such as the youth opportunities programme and the special temporary employment programme. Why does he keep them? I believe that, despite the philosophy of the Prime Minister, the Secretary of State sees value in these schemes. He knows that they train many for work and make people more acceptable to employers. He has seen that these schemes are able to restore the morale of the unemployed themselves and make them more capable of doing a hard day's work. Because he sees value in these schemes, he puts forward very half-baked arguments in favour of the cuts.
  I do not believe the right hon. Gentleman can face the truth of the Government's position, which seeks to take away employment and training from the young in order to provide additional luxury for very much richer people. How can the right hon. Gentleman justify reducing the planned provision of community industry from 7,000 to 6,000 places in order to save £1 million? The Government should provide at least 7,000 places, and probably many more, to satisfy the needs expressed by local authorities in towns throughout the country for jobs for those who will always find it difficult to obtain work.
  The cut in the special temporary employment programme of £42·2 million is savage. To slash the programme from 30,000 to 35,000 places to a target of 12,000 to 14,000 places and to confine it to certain special areas is to inflict great harm on many of our young unemployed—those in the 19 to 25 age group. Given the size of the problem, the Labour Government's provision was inadequate. We knew that. We had to wait to expand, however, until the Manpower Services Commission had successfully launched the youth opportunities programme for the 16- to 18-year-olds, because the MSC told us that it could not tackle both at once.
  The scheme should now be expanded rather than cut, and should remain nationwide. What justification is there
  1564
  for taking it way from many towns and localities with high rates of youth unemployment—some very high—just because they are not in special development areas, development areas and designated inner city areas?
  I suppose that the cut of £22·3 million in TOPS was, however regrettable, predictable—as was the introduction of charges for some direct training services to firms in assisted areas. The reduction of £9·8 million in funding to the industrial training boards certainly was not. How can we afford to undermine the training effort at present? Perhaps the Minister will tell the House what training grants have been affected and say how this will improve our competitive position.
  In cutting over £25 million from the youth opportunities programme the Government may be making it impossible for the MSC and the careers service, which is in the front line, to meet their objective—that is, to provide an opportunity for each youngster who leaves school and indeed for every youngster, including those who have left school in earlier years who have been unemployed for a year or more.
  On Tuesday the British Youth Council warned that the cut will lead to a reduction in the number in the programme at the peak and to a marked fall-off in quality. Perhaps the Minister will comment on the observations of that council. I personally warn the Government that the objectives of the youth opportunities programme will not be met by shifting provision to the cheapest possible opportunities. They can be met only when the right—not the cheapest—balance of opportunities is available. From all I have learned so far, it will be the rough and tumble youngsters throughout the country who will suffer the most. I refer to those youngsters whom employers and sponsors want the least, and the youngsters for whom we shall have to make provision, directly through the agency of the MSC, together with the careers service.
  I do not think the right hon. Gentleman knows what he has done with the youth opportunities programme. I think he will find out in December, January and February of next year when youngsters are suffering very greatly and when he sees a crisis of morale in the careers

  1565
  service and the MSC. At that point he will see the damage he is inflicting on the programme.
  I hope that the Government will have serious second thoughts about the cuts which they have imposed—not on the MSC, but on the unemployed and particularly our young unemployed. I hope that they will restore those cuts before they do too much damage.
  6.45 p.m.
  The Under-Secretary of State for Employment (Mr. Jim Lester):It is a pleasure to think that in this important debate we have had three maiden speeches, and one returned. I welcome the remarks of the hon. Member for South Shields (Mr. Clark) on behalf of his constituency. I must tell him, in the kindest possible way, that in May 1974 the unemployment rate in his constituency was 2,988 and in May 1979 it was 4,966, an increase of 60 per cent. That is why the present Government won the election and are now seeking to find other ways of curing that problem. The measures we are operating, including the youth opportunities programme, are being expanded in such areas as the hon. Gentleman's but broadly in proportion to the numbers of unemployed young people in that region. I hope to visit the region in the near future to examine some of the work that is being carried out.
  We very much appreciated the excellent speech of my hon. Friend the Member for Coventry, South-West (Mr. Butcher). As a Member who also has a university interest, I appreciate his remarks about the ginger group, and particularly about football teams. This is a success that Nottingham shares with Merseyside, because when Merseyside is not winning one of the prizes, we are winning one of the other three. I appreciate his concern about unemployment problems and I thought he made an excellent contribution to the debate.
  We then had a maiden speech by my hon. Friend the Member for Sevenoaks (Mr. Wolfson), a member of the Industrial Society. He is welcome to the small bank of Members of Parliament with industrial experience and I am sure that his remarks in this debate will make a useful impact on future debates, especially in the area of training relative to jobs.
  1566
  The last maiden speech in this debate is of course my own contribution from the Government Front Bench. I wish first to confirm our general attitude to manpower programmes and the special employment measures. I wish to introduce some balance into the debate, especially following the choice of words of the hon. Member for Newcastle-under-Lyme (Mr. Golding). It was a Conservative Government who set up the Manpower Services Commission, and we continue to attach importance to the involvement of the TUC and the CBI, through the Commission, in the operation of manpower programmes and to the employment and training programmes operated by the Commission, especially in relation to our key objectives in reversing industrial decline. We therefore have no intention of abolishing the Commission or of radically cutting back the programe which it operates.
  On the other hand, there was an exceptionally rapid expansion of the Commission's training and employment programmes under the previous Government, running alongside the new demands on the new Commission to operate large special employment programmes for the young and long-term unemployed. This called for an equally rapid expansion in the public expenditure required for the Commission's programmes. Following this, it seemed to us that a period of consolidation is required, as my hon. Friend the Member for Saffron Walden (Mr. Haselhurst) suggested. This is to ensure that the manpower programmes are developed in the most cost-effective ways and also in relation to our objective of reversing our industrial decline and creating the conditions for faster growth, which we all agree is the only way in which to achieve a lasting solution to the problems of unemployment. This point was not dealt with in any detailed way by Opposition Members.
  We agree that, for example, we need to ensure that industrial training programmes are focused on the key skills that will be required in the future, and that programmes for young people are designed to ease the transition from school to work and to assist unemployed young people as quickly as possible into permanent jobs. That is a point upon which we place great importance. I welcomed particularly the speech by my hon.

  1567
  Friend the Member for Saffron Walden. He has great knowledge about the matter.
  Therefore, the public expenditure cuts that have been made in the Manpower Services Commission do not radically change the Commission's programmes but represent some pruning and reshaping of earlier plans. For example, the modernisation of the employment services will proceed next year with the opening of a further 100 jobcentres—hardly a cutback. The training opportunities scheme will continue with broadly the same level of activity as in 1978 and 1979, with the places for the training of technicians, the main computer-related occupations and the main craft occupations in skillcentres remaining largely unaffected. There will be no reduction in disabled people's training.
  We have adopted a similar approach to the special employment measures as to the MSC's employment and training programmes—that is, not to abolish, but to prune, some of the plans for the programmes. The full range of special measures will continue to operate this year, but some of them will be more sharply focused on areas of high unemployment in particular need of the assistance that the measures provide. The changes that we have made to some of the measures does not mean that unemployment will increase as the cuts relate to planned expansions. Therefore, over the year we expect the impact of the special measures programme to increase—after a year under the previous Government when the impact fell.
  Mr. Park:I appreciate that, in the short time that the Minister has at his disposal, he cannot be expected to answer specific questions in detail. However, I should like to ask him if he would be good enough to let me know—possibly by mail—the overall implications for Coventry.
  Mr. Lester:I give that undertaking. I shall be delighted to write to the hon. Gentleman.
  Labour Members should welcome the concentration on areas which they represent. Surely, it is right to review the results with the object of greater success in Merseyside, the North-East of England and the West Coast of Scotland. So far, solutions in those areas have eluded both
  1568
  Labour and Conservative Governments. The areas still face major changes in their industrial base and the technological changes yet to come. The Government wish to recreate the dynamism in those areas which originally made them what they are.
  The hon. Member for Liverpool, Edge Hill (Mr. Alton) represents an area which I have visited and hope to visit again shortly. The hon. Gentleman got his figures wrong—he doubled the expenditure of the youth opportunities programme. It was rather strange for him to criticise the cuts in a body which I understood him to want to abolish. We intend to keep intact the job release scheme, as the hon. Member for New-castle-under-Lyme mentioned. We see that as creating permanent jobs for the future.
  Mr. Golding:Will the Minister state what jobs are created?
  Mr. Lester:If the hon. Gentleman had waited, I would have provided him with an answer to that question. If a person retires, his job will be a new one for someone coming off the unemployment list. That will create a permanent job. None of the other measures which we have been discussing will do that.
  We share the concern expressed by all hon. Members about unemployment. We are all aware of the effect that it has upon individuals, families and whole areas of the country. We are also concerned about the grim outlook which we inherited from the previous Government. We might be more inclined to accept the advice of right hon. and hon. Members opposite if their policies had shown any signs of reversing our industrial decline. But we know that during the last five years, over which they presided, the decline continued and accelerated with unemployment doubling to the current level. For far too long the United Kingdom economy had been in decline in relation to other countries. If that had continued, the unemployment prospect in the years ahead would have remained gloomy indeed.
  There is only one way to tackle the unemployment problem and that is to create the conditions for faster growth and improved industrial performance. That is the way to create more permanent jobs

  1569
  and lower levels of unemployment. Pumping more and more expenditure into manpower programmes is no substitute for the underlying improvement that we must achieve in our economic performance. That is why we need the new strategy that we have embarked on, to check and reverse our industrial decline. That is why we are determined to strengthen incentives, to enlarge freedom of choice for the individual and to reduce the role of the State, to reduce the burden of financing the public sector and to ensure, so far as possible, that those who take part in collective bargaining understand the consequences of their action.
  It is in this context that we decided to find some savings in the rapidly expanding Manpower Services Commission programmes and the special employment measures, but it does not mean that we do not attach importance to those programmes. We accept that the programmes can play an important part in ensuring that workers are equipped with the skills that they and the economy will need in the years ahead and in ensuring that workers are assisted in finding suitable employment. We accept that at a time of high unemployment the special employment programmes operated by the MSC and by the Department of Employment have an important role to play in providing jobs or training opportunities for those who would otherwise be unemployed—such as unemployed young people and the long-term unemployed—and in areas of particularly high unemployment where the need is greatest.
  We also see that these programmes make it easier for workers to accept technological change on which future employment prospects depend. No one can underestimate the impact of technological
  change. The micro-chip has been mentioned in the debate—indeed, it is an "in" thing for hon. Members to mention micro-chips in almost all their speeches. It is as if it were "micro-chips with everything". Few of us have the opportunity to understand the impact of technological change. So many hon. Members are tied up with affairs at the House and constituency duties. Our contact with micro-chips is from reading reports and attending select conferences. Few people have yet come to terms with technological change.
  In that context it is inevitable that we should have flexible policies and that we should be prepared to re-examine the sort of schemes that have been created in the special sense that the last Government created them. In the futuure we shall have to be open-minded and flexible because it is hard to assess either the impact of technological change or the changes in the world which vary day by day.
  The real acid test in this country is that manpower measures in themselves, as the previous Government found, cannot provide a real or lasting solution to the underlying unemployment problem. A new approach is needed to reverse our industrial decline, which has proceeded unchecked for far too many years.
  The tax changes in the Budget—a Budget produced rapidly—represent the first step in the new approach which the Government are determined to pursue. A new climate must be created in which industry and commerce can flourish. That is the way to increase our living standards and provide the extra jobs that we all seek to reduce unemployment.
  Question put:—
  The House divided: Ayes 244, Noes 304.

  Division No. 16]

  AYES

  [7.00 p.m.

  Abse, Leo

  Boothroyd, Miss Betty

  Cartwright, John

  Adams, Allen

  Bottomley, Rt. Hon. Arthur (M'brough)

  Clark, David (South Shields)

  Allaun, Frank

  Bradley, Tom

  Cocks, Rt. Hon. Michael (Bristol S)

  Alton, David

  Bray, Dr. Jeremy

  Cohen, Stanley

  Anderson, Donald

  Brown, Hugh D. (Provan)

  Coleman, Donald

  Archer, Rt. Hon. Peter

  Brown, Robert C. (Newcastle W)

  Concannon, Rt. Hon. J. D.

  Armstrong, Ernest

  Brown, Ronald W. (Hackney S)

  Conlan, Bernard

  Ashley, Jack

  Brown, Ron (Edinburgh, Leith)

  Cowans, Harry

  Ashton, Joe

  Buchan, Norman

  Cox, Tom (Wandsworth, Tooting)

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

  Callaghan, Rt. Hon. J. (Cardiff SE)

  Crowther, J. S.

  Barnett, Guy (Greenwich)

  Callaghan, Jim (Middleton & P)

  Cryer, Bob

  Barnett, Rt. Hon. Joel (Heywood)

  Campbell, Ian

  Cunliffe, Lawrence

  Benn, Rt. Hon. Anthony Wedgwood

  Campbell-Savours, Dale

  Cunningham, George (Islington S)

  Bennett, Andrew (Stockport N)

  Canavan, Dennis

  Cunningham, Dr. John (Whitehaven)

  Bidwell, Sydney

  Carmichael, Neil

  Davidson, Arthur

  Booth, Rt. Hon. Albert

  Carter-Jones, Lewis

  Davies, Rt. Hon. Denzil (Llanelli)

  Davies, E. Hudson (Caerphilly)

  Hughes, Robert (Aberdeen North)

  Race, Reg

  Davies, Ifor (Gower)

  Janner, Hon. Greville

  Radice, Giles

  Davis, Clinton (Hackney Central)

  Jay, Rt. Hon. Douglas

  Rees, Rt. Hon. Merlyn (Leeds South)

  Davis, Terry (B'rm'ham, Stechford)

  John, Brynmor

  Richardson, Miss Jo

  Deakins, Eric

  Johnson, James (Hull West)

  Roberts, Albert (Normanton)

  Dean, Joseph (Leeds West)

  Johnson, Walter (Derby South)

  Roberts, Allan (Bootle)

  Dempsey, James

  Johnston, Russell (Inverness)

  Roberts, Ernest (Hackney North)

  Dewar, Donald

  Jones, Alec (Rhondda)

  Roberts, Gwilym (Cannock)

  Dixon, Donald

  Jones, Barry (East Flint)

  Robertson, George

  Dobson, Frank

  Kaufman, Rt. Hon. Gerald

  Robinson, Geoffrey (Coventry N. W.)

  Dormand, J. D.

  Kerr, Russell

  Rodgers, Rt. Hon. William

  Douglas, Dick

  Kilroy-Silk, Robert

  Rooker, J. W.

  Douglas-Mann, Bruce

  Lambie, David

  Ross, Ernest (Dundee West)

  Dubs, Alfred

  Lamborn, Harry

  Ross, Stephen (Isle of Wight)

  Duffy, A. E. P.

  Lamond, James

  Rowlands, Ted

  Dunn, James A. (Liverpool, Kirkdale)

  Leadbitter, Ted

  Sandelson, Neville

  Dunnett, Jack

  Leighton, Ronald

  Sever, John

  Dunwoody, Mrs. Gwyneth

  Lestor, Miss Joan (Eton & Slough)

  Shore, Rt. Hon. Peter (Step and Pop)

  Eadie, Alex

  Lewis, Ron (Carlisle)

  Short, Mrs. Renée

  Eastham, Ken

  Lofthouse, Geoffrey

  Silkin, Rt. Hon. John (Deptford)

  Edwards, Robert (Wolv S. E.)

  Lyon, Alexander (York)

  Silkin, Rt. Hon. S. C. (Dulwich)

  Ellis, Raymond (N. E. Derbyshire)

  Mabon, Rt. Hon. Dr. J. Dickson

  Silverman, Julius

  Ellis, Tom (Wrexham)

  McDonald, Dr. Oonagh

  Skinner, Dennis

  English, Michael

  McElhone, Frank

  Smith, Rt. Hon. J. (North Lanarkshire)

  Ennals, Rt. Hon. David

  McKay, Allen (Penistone)

  Snape, Peter

  Evans, Ioan (Aberdare)

  McKelvey, William

  Soley, Clive

  Evans, John (Newton)

  MacKenzie, Rt. Hon. Gregor

  Spearing, Nigel

  Field, Frank

  Maclennan, Robert

  Spriggs, Leslie

  Fitch, Alan

  McMillan, Tom (Glasgow, Central)

  Stallard, A. W.

  Fitt, Gerard

  McNally, Thomas

  Stewart, Rt. Hon. Donald (W Isles)

  Flannery, Martin

  McWilliam, John

  Stoddart, David

  Fletcher, L. R. (Ilkeston)

  Magee, Bryan

  Stott, Roger

  Marks, Kenneth

  Strang, Gavin

  Fletcher, Ted (Darlington)

  Marshall, David (Gl'sgow, Shettles'n)

  Straw, Jack

  Foot, Rt. Hon. Michael

  Marshall, Dr. Edmund (Goole)

  Summerskill, Hon. Dr. Shirley

  Ford, Ben

  Marshall, Jim (Leicester South)

  Taylor, Mrs. Ann (Bolton West)

  Forrester, John

  Martin, Michael (Gl'gow, Springb'rn)

  Thomas, Mike (Newcastle East)

  Foster, Derek

  Mason, Rt. Hon. Roy

  Thomas, Dr. Roger (Carmarthen)

  Foulkes, George

  Maxton, John

  Thorne, Stan (Preston South)

  Fraser, John (Lambeth, Norwood)

  Maynard, Miss Joan

  Tilley, John

  Freeson, Rt. Hon. Reginald

  Meacher, Michael

  Torney, Tom

  Freud, Clement

  Mellish, Rt. Hon. Robert

  Varley, Rt. Hon. Eric G.

  Garrett, John (Norwich S)

  Mikardo, Ian

  Wainwright, Edwin (Dearne Valley)

  Garrett, W. E. (Wallsend)

  Millan, Rt. Hon. Bruce

  Walker, Harold (Doncaster)

  George, Bruce

  Mitchell, Austin (Grimsby)

  Watkins, David

  Gilbert, Rt. Hon. Dr. John

  Mitchell, R. C. (Soton, Itchen)

  Weetch, Ken

  Ginsburg, David

  Morris, Rt. Hon. Alfred (Wythenshawe)

  Wellbeloved, James

  Golding, John

  Morris, Rt. Hon. Charles (Openshaw)

  Welsh, Michael

  Gourlay, Harry

  Morris, Rt. Hon. John (Aberavon)

  White, Frank R. (Bury & Radcliffe)

  Graham, Ted

  Morton, George

  White, James (Glasgow, Pollok)

  Grant, George (Morpeth)

  Moyle, Rt. Hon. Roland

  Whitlock, William

  Grant, John (Islington C)

  Mulley, Rt. Hon. Frederick

  Willey, Rt. Hon. Frederick

  Hamilton, James (Bothwell)

  Newens, Stanley

  Williams, Rt. Hon. Alan (Swansea W)

  Hamilton, W. W. (Central Fife)

  Oakes, Gordon

  Williams, Sir Thomas (Warrington)

  Harrison, Rt. Hon. Walter

  Ogden, Eric

  Wilson, Gordon (Dundee East)

  Hattersley, Rt. Hon. Roy

  O'Halloran, Michael

  Wilson, Rt. Hon. Sir Harold (Huyton)

  Haynes, David

  O'Neill, Martin

  Wilson, William (Coventry S. E.)

  Healey, Rt. Hon. Denis

  Orme, Rt. Hon. Stanley

  Winnick, David

  Heffer, Eric S.

  Owen, Rt. Hon. Dr. David

  Woodall, Alec

  Hogg, Norman (E Dunbartonshire)

  Palmer, Arthur

  Woolmer, Kenneth

  Holland, Stuart (L'beth, Vauxhall)

  Park, George

  Wrigglesworth, Ian

  Homewood, William

  Parker, John

  Wright, Miss Sheila

  Hooley, Frank

  Parry, Robert

  Young, David (Bolton East)

  Horam, John

  Pendry, Tom

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

  Powell, Raymond (Ogmore)

  TELLERS FOR THE AYES:

  Huckfield, Les

  Prescott, John

  Mr. Hugh McCartney and

  Hughes, Mark (Durham)

  Price, Christopher (Lewisham West)

  Mr. James Tinn.

  NOES

  Adley, Robert

  Berry, Hon. Anthony

  Brittan, Leon

  Aitken, Jonathan

  Best, Keith

  Brocklebank-Fowler, Christopher

  Alexander, Richard

  Bevan, David Gilroy

  Brooke, Hon. Peter

  Alison, Michael

  Biffen, Rt. Hon. John

  Brotherton, Michael

  Amery, Rt. Hon. Julian

  Blackburn, John

  Brown, Michael (Brigg & Sc'thorpe)

  Ancram, Michael

  Blaker, Peter

  Browne, John (Winchester)

  Arnold, Tom

  Body, Richard

  Bruce-Gardyne, John

  Aspinwall, Jack

  Bonsor, Sir Nicholas

  Bryan, Sir Paul

  Atkins, Robert (Preston North)

  Boscawen, Hon. Robert

  Budgen, Nick

  Baker, Kenneth (St. Marylebone)

  Bottomley, Peter (Woolwich West)

  Bulmer, Esmond

  Baker, Nicholas (North Dorset)

  Bowden, Andrew

  Burden, F. A.

  Bell, Ronald

  Boyson, Dr. Rhodes

  Butcher, John

  Bendall, Vivian

  Braine, Sir Bernard

  Butler, Hon. Adam

  Benyon, Thomas (Abingdon)

  Bright, Graham

  Cadbury, Jocelyn

  Benyon, W. (Buckingham)

  Brinton, Timothy

  Carlisle, John (Luton West)

  1572

  1573

  Carlisle, Kenneth (Lincoln)

  Hogg, Hon. Douglas (Grantham)

  Osborn, John

  Carlisle, Rt. Hon. Mark (Runcorn)

  Holland, Philip (Carlton)

  Page, Rt. Hon. R. Graham (Crosby)

  Chalker, Mrs. Lynda

  Hooson, Tom

  Parkinson, Cecil

  Channon, Paul

  Hordern, Peter

  Parris, Matthew

  Chapman, Sydney

  Howe, Rt. Hon. Sir Geoffrey

  Patten, Christopher (Bath)

  Churchill, W. S.

  Howell, Rt. Hon. David (Guildford)

  Patten, John (Oxford)

  Clark, Hon. Alan (Plymouth, Sutton)

  Howell, Ralph (North Norfolk)

  Pattie, Geoffrey

  Clark, William (Croydon South)

  Hunt, David (Wirral)

  Pawsey, James

  Clarke, Kenneth (Rushcliffe)

  Hunt, John (Ravensbourne)

  Peyton, Rt. Hon. John

  Clegg, Walter

  Hurd, Hon. Douglas

  Pink, R. Bonner

  Cockeram, Eric

  Irving, Charles (Cheltenham)

  Pollock, Alexander

  Colvin, Michael

  Jenkin, Rt. Hon. Patrick

  Porter, George

  Cope, John

  Johnson Smith, Geoffrey

  Prentice, Rt. Hon. Reg

  Cormack, Patrick

  Jopling, Rt. Hon. Michael

  Price, David (Eastleigh)

  Corrie, John

  Joseph, Rt. Hon. Sir Keith

  Prior, Rt. Hon. James

  Costain, A. P.

  Kaberry, Sir Donald

  Proctor, K. Harvey

  Cranborne, Viscount

  Kellett-Bowman, Mrs. Elaine

  Raison, Timothy

  Crouch, David

  Kimball, Marcus

  Rathbone, Tim

  Dean, Paul (North Somerset)

  King, Rt. Hon. Tom

  Rees, Peter (Dover and Deal)

  Dickens, Geoffrey

  Kitson, Sir Timothy

  Rees-Davies, W. R.

  Dodsworth, Geoffrey

  Knight, Mrs. Jill

  Renton, Tim

  Dorrell, Stephen

  Knox, David

  Rhodes James, Robert

  Dover, Denshore

  Lamont, Norman

  Rhys Williams, Sir Brandon

  du Cann, Rt. Hon. Edward

  Lang, Ian

  Ridley, Hon. Nicholas

  Dunn, Robert (Dartford)

  Latham, Michael

  Ridsdale, Julian

  Durant, Tony

  Lawrence, Ivan

  Rifkind, Malcolm

  Dykes, Hugh

  Lawson, Nigel

  Rippon, Rt. Hon. Geoffrey

  Eden, Rt. Hon. Sir John

  Lee, John

  Roberts, Michael (Cardiff NW)

  Edwards, Rt. Hon. N. (Pembroke)

  Le Marchant, Spencer

  Roberts, Wyn (Conway)

  Eggar, Timothy

  Lennox-Boyd, Hon. Mark

  Rossi, Hugh

  Elliott, Sir William

  Lester, Jim (Beeston)

  Rost, Peter

  Emery, Peter

  Lewis, Kenneth (Rutland)

  Royle, Sir Anthony

  Eyre, Reginald

  Lloyd, Ian (Havant & Waterloo)

  Sainsbury, Hon. Timothy

  Fairbairn, Nicholas

  Lloyd, Peter (Fareham)

  St. John-Stevas, Rt. Hon. Norman

  Faith, Mrs. Sheila

  Loveridge, John

  Scott, Nicholas

  Farr, John

  Lyell, Nicholas

  Shaw, Giles (Pudsey)

  Fell, Anthony

  McAdden, Sir Stephen

  Shaw, Michael (Scarborough)

  Fenner, Mrs. Peggy

  McCrindle, Robert

  Shelton, William (Streatham)

  Finsberg, Geoffrey

  Macfarlane, Neil

  Shepherd, Colin (Hereford)

  Fisher, Sir Nigel

  MacGregor, John

  Shepherd, Richard (Aldridge-Br'hills)

  Fletcher, Alexander (Edinburgh N)

  Mackay, John (Argyll)

  Shersby, Michael

  Fletcher-Cooke, Charles

  Macmillan, Rt. Hon. M. (Farnham)

  Silvester, Fred

  Fookes, Miss Janet

  McNair-Wilson, Michael (Newbury)

  Sims, Roger

  Forman, Nigel

  McNair-Wilson, Patrick (New Forest)

  Skeet, T. H. H.

  Fowler, Rt. Hon. Norman

  McQuarrie, Albert

  Smith, Dudley (War. and Leam'ton)

  Fox, Marcus

  Madel, David

  Speed, Keith

  Fraser, Rt. Hon. H. (Stafford & St)

  Major, John

  Speller, Tony

  Marland, Paul

  Spence, John

  Fraser, Peter (South Angus)

  Marlow, Antony

  Spicer, Jim (West Dorset)

  Fry, Peter

  Marshall, Michael (Arundel)

  Spicer, Michael (S Worcestershire)

  Galbraith, Hon. T. G. D.

  Marten, Neil (Banbury)

  Sproat, Iain

  Gardiner, George (Reigate)

  Mates, Michael

  Squire, Robin

  Gardner, Edward (South Fylde)

  Mather, Carol

  Stanbrook, Ivor

  Garel-Jones, Tristan

  Maude, Rt. Hon. Angus

  Stanley, John

  Gilmour, Rt. Hon. Sir Ian

  Mawby, Ray

  Steen, Anthony

  Glyn, Dr. Alan

  Mawhinney, Dr. Brian

  Stevens, Martin

  Goodhew, Victor

  Maxwell-Hyslop, Robin

  Stewart, Ian (Hitchin)

  Goodlad, Alastair

  Mayhew, Patrick

  Stewart, John (East Renfrewshire)

  Gorst, John

  Mellor, David

  Stokes, John

  Gow, Ian

  Meyer, Sir Anthony

  Stradling Thomas, J.

  Gower, Sir Raymond

  Miller, Hal (Bromsgrove & Redditch)

  Tapsell, Peter

  Gray, Hamish

  Mills, Iain (Meriden)

  Taylor, Robert (Croydon NW)

  Greenway, Harry

  Mills, Peter (West Devon)

  Tebbit, Norman

  Griffiths, Eldon (Bury St Edmunds)

  Miscampbell, Norman

  Temple-Morris, Peter

  Griffiths, Peter (Portsmouth N)

  Mitchell, David (Basingstoke)

  Thomas, Rt. Hon. Peter (Hendon S)

  Grist, Ian

  Monro, Hector

  Thompson, Donald

  Gummer, John Selwyn

  Montgomery, Fergus

  Thorne, Neil (Ilford South)

  Hamilton, Hon. Archie (Eps'm & Ew'll)

  Moore, John

  Thornton, George

  Hamilton, Michael (Salisbury)

  Morgan, Geraint

  Townend, John (Bridlington)

  Hampson, Dr. Keith

  Morris, Michael (Northampton, Sth)

  Townsend, Cyril D. (Bexleyheath)

  Hannam, John

  Morrison, Hon. Charles (Devizes)

  Trippler, David

  Haselhurst, Alan

  Morrison, Hon. Peter (City of Chester)

  Trotter, Neville

  Hastings, Stephen

  Murphy, Christopher

  van Straubenzee, W. R.

  Hawksley, Warren

  Myles, David

  Vaughan, Dr. Gerard

  Hayhoe, Barney

  Neale, Gerrard

  Viggers, Peter

  Heath, Rt. Hon. Edward

  Needham, Richard

  Waddington, David

  Heddle, John

  Nelson, Anthony

  Waldegrave, Hon. William

  Henderson, Barry

  Neubert, Michael

  Walker-Smith, Rt. Hon. Sir Derek

  Heseltine, Rt. Hon. Michael

  Normanton, Tom

  Wall, Patrick

  Hicks, Robert

  Nott, Rt. Hon. John

  Waller, Gary

  Higgins, Terence L.

  Onslow, Cranley

  Walters, Dennis

  Hill, James

  Oppenheim, Rt. Hon. Mrs. Sally

  Ward, John

  1574

  1575

  Watson, John

  Wickenden, Keith

  Young, Sir George (Acton)

  Wells, John (Maidstone)

  Wiggin, Jerry

  Younger, Rt. Hon. George

  Wells, P. Bowen (Hert'rd & Stev'nage)

  Wilkinson, John

  Wheeler, John

  Williams, Delwyn (Montgomery)

  TELLERS FOR THE NOES:

  Whitelaw, Rt. Hon. William

  Winterton, Nicholas

  Mr. Tony Newton and

  Whitney, Raymond

  Wolfson, Mark

  Mr. John Wakeham.

  Question accordingly negatived.

  CHESHIRE COUNTY COUNCIL BILL [Lords] (By Order)
  7.14 p.m.
  Mr. Deputy Speaker (Mr. Richard Crawshaw): I have to inform the House that Mr. Speaker has not selected the motion
  "That the Bill be read a Second time upon this day six months"
  standing in the names of the hon. Member for Stockport, North (Mr. Bennett) and others but he has selected the second motion standing in the names of the hon. Member and others:
  "That it he an instruction to the Committee on the Bill to leave out clause 29."
  The third, fourth and fifth motions are not subject to Mr. Speaker's selection and will be called if time permits, but they cannot be entered upon after 10 o'clock.
  As there will be only a limited amount of time after 10 o'clock in which to discuss the Instruction, it may be for the convenience of the House if the Second Reading debate and that on the motion for an Instruction are taken together. If that is the wish of the House, it will be done. There will, of course, be an opportunity for the hon. Member for Stockport, North formally to move his Instruction and have it divided upon if the Bill receives a Second Reading.
  Order for Second Reading read.
  Mr. J. W. Rooker: On a point of order, Mr. Deputy Speaker. I do not want to delay the House, but I wish to raise the question of the position of the petitioners should the Instruction to remove clause 29 be approved.
  If the House agrees to that Instruction, when the Bill reaches Committee it will no longer contain clause 29 and there will therefore be no need to petition against it. However, it will be open to any hon. Member, when the Bill comes back on Report, to retable clause 29 on the Amendment Paper, with a motion for its reinstatement in the Bill. That situation arose on the Second Reading of the West Midlands Bill, when the House agreed to the removal of a similar clause.
  As a result, that clause was not considered in Committee and the petitioners,
  1578
  who had lodged objections to it, were not able to pursue the matter further because the House had removed the clause on Second Reading. However, the hon. Member for Birmingham, Edgbaston (Mrs. Knight) has tabled that clause for reinstatement in the West Midlands Bill on Report. It means that the petitioners who originally lodged objections, at some expense, operating under the rules of the Standing Orders on Private Business, will have no opportunity to petition the House on that clause, even though it will be before the House.
  That is the point about the Cheshire County Council Bill. Let us suppose that the House tonight decides to remove clause 29, according to the Instruction on the Order Paper. I have been through the Standing Orders on Private Business—a substantial document—and I have also checked in "Erskine May", albeit briefly, and I cannot find any occasion on which petitioners against a clause in a Private Bill have had their constitutional and democratic rights removed from them, not deliberately, but by a quirk of procedure. Is that in order? If the House were to decide to remove clause 29, in accordance with the Instruction, would that mean the removal of the rights of those who have petitioned against the clause?
  Mr. Deputy Speaker: I do not think that I can fault the hon. Member for Birmingham, Perry Barr (Mr. Rooker) on his argument, but it is always in the power of the House to put something back in a Bill when it is reported to the House. While the hon. Gentleman's point of order is interesting, it is not for me on this occasion, because these are the mechanics of Parliament.
  Mr. Andrew F. Bennett: Further to that point of order, Mr. Deputy Speaker. Standing Orders for Private Business are, apparently, designed to protect petitioners who have no rights themselves to speak in the House. It appears, however, that if clause 29 is removed tonight, in accordance with the Instruction standing in my name and that of other hon. Members, we shall prevent the petitioners in this case from petitioning. As they wish to petition against clause 29 they will have no objection to its removal, but if an hon. Member can move the reinstatement of the clause on

  1579
  Report the effect will be that the petitioners will be denied their right to petition against the clause.
  There is a procedure for the recommittal of Bills. Perhaps we may have some guidance from the Chair on whether it is correct that if an hon. Member tries to reinstate on Report a provision which has been removed earlier by an Instruction of the House, the Bill must be recommitted so that those who are opposed to the provision can petition against it, as they would have done in the first place had it not been removed on Second Reading.
  Mr. Deputy Speaker: We are considering a particular Bill, and the submission of the hon. Gentleman is hypothetical in respect of that Bill. If the clause is not removed tonight, that situation will not arise.
  Mr. Bennett: Further to that point of order, Mr. Deputy Speaker. I have a problem. You have agreed that my Instruction to take out clause 29 can be debated. If I push the matter to a vote and I am successful in having the clause removed, it would appear that those who are opposed to it will be denied the right to petition against it. If the clause remains out of the Bill, I am sure they will be pleased. If, however, an attempt is made to reintroduce the clause on Report, the right to petition is lost.
  A safeguard exists in the proceedings of the House generally that no hon. Member can restore a clause which the House has taken out. It has to be reintroduced in some alternative form. I believe that with Government Bills it is possible for the Government to put a clause back in a Bill. What safeguards exist for those petitioners to ensure that if something is taken out on Second Reading it cannot be put back in identical form on Report, so preventing them from having their petition, on which they have spent money, brought forward through the private business of the House?
  Mr. Deputy Speaker: I repeat that these are hypothetical questions, which do not arise now. The hon. Gentleman asked the Chair whether he should vote for or against. That is not a matter for the Chair. The hon. Gentleman knows the legal implications of what he is doing. It is for him to make up his mind.
  7.22 p.m.
  Mr. Alastair Goodlad: I beg to move, That the Bill be now read a Second time.
  The Bill is promoted by the Cheshire County Council in consultation with the eight district councils in this non-metropolitan county, namely, the borough councils of Warrington, Halton, Ellesmere Port, Vale Royal, Macclesfield, Crewe and Congleton and Chester city council. The purpose of the Bill is to achieve for Cheshire the rationalisation of local legislation which is desired of all local authorities following the enactment of the Local Government Act 1972. Section 262 of that Act provided for the interim continuance in every local government area of the local legislation applicable to the old local authority until, in the case of shire counties, the end of 1984, the metropolitan counties' local legislation being intended to expire at the end of 1979. For Cheshire, this involved the detailed examination of over 150 local Acts and orders.
  Section 262 of the Local Government Act 1972 defines clearly the local legislation to which it is to apply and which will be repealed. Generally speaking, it applies to all forms of local legislation promoted by a local authority, the exceptions extending to special law relevant to particular kinds of undertakings including harbours, markets and public utilities.
  The scheme of review for local legislation commended to local authorities by the then Government and subsequently by the Department of the Environment has been subjected to detailed scrutiny between the passing of the Act of 1972 and the prospective repeal effected by section 262 of that Act of all local law even beyond the confines of what is actually repealed by the section. It was then expected that before the repeal took effect each county council, in consultation with the district councils for the area, should ensure the promotion of a Private Bill to preserve such of the existing local enactments as warranted continuance, the promoters being required to demonstrate in the ordinary manner applicable to Private Bills a present need for the powers proposed.
  At the same time, the opportunity would be taken to include new powers needed to deal with urgent local problems.

  1581
  In each of the nine Bills introduced in this context, a small number of fresh powers have therefore been sought. Where Local Act provisions had, since their enactment, been replaced by general legislation, no need for re-enactment could of course be shown. The result of the project, as in the case of every Bill of this kind so far appearing before Parliament, is to remove a substantial amount of dead wood from the local statute book and achieve a major advance in its intelligibility.
  At the outset, I pay tribute to the promoters of the Bill, the Cheshire county council, for their patience and industry in bringing this measure before us, given the obstacles that have been placed in their way during the past few months. Apart from those obstacles, it has taken three years of preparatory work, not to mention considerable expense, on the part of Cheshire. It has entailed consultation with the eight district councils, their officers and representatives.
  I pay particular tribute to Sir John Boynton, secretary and chief executive of the Cheshire county council, for his work not only on the Bill but for Cheshire as a whole and for local government. It is a matter for sorrow in Cheshire, and I suspect for this House, that he is retiring this year. I also pay tribute to Mr. Kellett for his work on the Bill and to all the officers and members of the staff of the county council, the district councils and those people in Government Departments and outside bodies, such as the trade unions, who have contributed to the thinking which has gone into the making of the Bill.
  It is not my intention to go through every clause. My hon. Friend the Member for Wirral (Mr. Hunt) will deal with particular questions about its provisions in winding up the debate.
  I should perhaps say that the Bill deals with a number of different matters affecting the functions of the county council as well as of the constituent district councils. Part II relates particularly to employment opportunity. Great importance is attached by the promoters to the powers made available by the Bill. I hope that the necessity for their use will be infrequent and that they will be used sparingly and selectively. With other local autho-
  1582
  rities in the region having similar powers, it is clearly necessary that Cheshire should have comparable ones.
  Clause 29, to which the hon. Member for Birmingham, Perry Barr (Mr. Rooker) has referred, is the chief bone of contention before the House. The promoters particularly wish to be permitted to canvass the case for this clause or for that case to be canvassed in Committee in the context of the West Midlands County Council Bill, from which a similar clause was deleted by a motion on Second Reading, and in the context of the County of Merseyside Bill, in which the clause was allowed to proceed following a Division on Second Reading on 13 March 1979.
  In the case of the Bill before us, the promoters will seek the leave of the Committee to make amendments consistent with those proposed for Merseyside. In particular, leave will be sought to reduce the period of notice from seven to three days and to add to the exemptions already included in the clause, for processions by charitable organisations, an exemption for processions organised or conducted for the purpose of any funeral by a person acting in the normal course of business as a funeral director, and to provide that proceedings shall not be instituted for any offence under the clause, nor for any attempt, incitement or conspiracy to permit any such offence, unless the proceedings are instituted by or with the consent of the Director of Public Prosecutions.
  Mr. Eldon Griffiths: Will my hon. Friend explain in more detail the point he makes about funerals? In Northern Ireland, and recently in the London area, a funeral was turned into a political procession. That can happen. I should like to be clear that when my hon. Friend suggests that the promoters will wish to amend clause 29 in respect of funerals he is saying that this relates to funerals that are the normal process of interring people and recognising their end rather than those occasions when a funeral can be, and sometimes is, turned into a major political occasion.
  Mr. Goodlad: I am grateful to my hon. Friend for raising this important point. The wording suggested is "the normal course of business as a funeral director". The circumstances in which a funeral is normal or abnormal should

  1583
  be a matter for consideration in Committee. It may be a matter for close scrutiny or for amendments, or perhaps for amendments of amendments. If my hon. Friend would like to pursue the point further, I know that my hon. Friend the Member for Wirral will take it up when he winds up.
  Mr. Rooker: One has to be careful what one says here, but it might help the hon. Member for Bury St. Edmunds (Mr. Griffiths) to point out that the central issue is who organises the procession. Clearly, in the recent case to which the hon. Gentleman referred, the funeral directors who were doing the business of funeral directing did not in the course of their business organise a procession. Someone else, or some other body, did that. Therefore, I do not think that we should get too concerned about the operations of funeral directors in the sense that they are covered in the Bill and in the sense in which we have discussed them on previous Bills.
  Mr. Goodlad: Indeed, the principal argument in favour of clause 29, as in the case of Merseyside, is that a similar provision is now in force in Cheshire under the Cheshire County Council Act 1953 and in certain other local Acts. In practice, the existing local Act provisions have worked well, with the general acceptance of all concerned. It has been found in Cheshire that the existence of the local Act powers has been well understood by the organisers of processions and in Cheshire respected by them.
  Where necessary, it has been brought to the organisers' notice, but in general the law has not been applied rigidly and the general attitude of the police is that every endeavour should be made to help organisers of processions, with due regard for the safety of the public in the streets from a road traffic and other points of view and also with due regard for the needs of persons living or working in premises adjoining the streets for peace and security while processions are going on.
  Mr. Andrew F. Bennett: The hon. Gentleman says that the existing law is working well. He will be aware that the period of notice under that law is only 36 hours. If that has worked well, what is the argument for proposing an increase to seven days and then reducing it to
  1584
  three days? I thought that the promoters, in their letters, were saying, in effect, "We do not need three days. We put it in simply because that was the common clause." Since all Bills are separate, would it not be better to stick to 36 hours, which has worked so well in Cheshire, get the whole thing through quickly and even save the promoters some money?
  Mr. Goodlad: The appropriate period is a matter of opinion. The hon. Gentleman has studied the matter, so he will know that there are 115 separate precedents for this power. A number of different periods of notice are involved, many of them shorter than three days, a few longer.
  Given the additional pressures on the police, the need for consideration, for the cancellation of leave and so on, a period of three days is desirable if processions are to be adequately regulated by sufficient police without too much inconvenience to the police and if such processions are to be adequately protected. However, I agree that it is a matter of opinion, and we can debate the matter further in Committee.
  Mrs. Gwyneth Dunwoody: Can the hon. Gentleman tell us of any occasion in the last 10 years when 36 hours has not been found sufficient and great confusion has been caused? When did this riotous assembly take place?
  Mr. Goodlad: I hope that the hon. Lady is not suggesting that there is any question of there being a riotous assembly in Cheshire—certainly not in my constituency, or hers, I should have thought. It has been the custom to give a week's notice. There have been street processions which have given rise to unhappy incidents, such as in Ellesmere Port in 1971—
  Mrs. Dunwoody:Nine years ago.
  Mr. Goodlad:—eight years ago, when a mass of flying pickets took off on a march along a busy arterial road. That led to chaos, brought traffic to a standstill, left many drivers and other members of the public generally confused and, even more important, placed some people in danger. The police found it necessary to make a number of arrests—45, I believe—and I am told that they are of the opinion that had adequate advance warning of the

  1585
  march been given, the necesary arrangements could have been made, confusion and danger could have been avoided, and no need for arrests would have arisen.
  Mrs. Dunwoody:I apologise for interrupting again, but how many processions have been notified to the Cheshire police since 1971?
  Mr. Goodlad:I regret to say that I cannot tell the hon. Lady the exact number, but my hon. Friend the Member for Wirral will try to do so.
  On the Ellesmere Port occasion, I understand that the assistant chief constable is of the opinion that the procession could have taken place with no unfortunate incident had notice been given in accordance with the statutory powers. Section 3 of the Public Order Act 1936 empowers the chief officer of police to give directions as to the route that the march should take and also requires the chief officer, in a case of serious danger, to request the district council to apply to the Home Secretary for an order banning marches in its area for a limited period. In practice, those powers can be exercised only if the authorities have advance notice of a march. Furthermore, the police cannot arrange for extra men to be on hand to maintain order without such notice, since it takes time to cancel leave and to make arrangements with other police forces to draft men into the area where they are required. As the hon. Lady and others will know, we have seen examples of that in the past few months—although not, I admit, in Cheshire.
  The fact that there are 115 precedents since 1910 for provisions to require notice of public processions shows that most local authorities have found the power of major assistance in securing the orderly carrying on of processions in their areas.
  Mr. Andrew F. Bennett:I am sure that the hon. Gentleman knows that many in that list apply only to processions which involve live circus animals.
  Mr. Goodlad:Indeed, yes.
  The provisions of the clause also fall clearly within the intentions of Parliament in enacting section 262 of the Local Government Act 1972 and within the advice of the Department of the Environment that the powers, which are in regular use,
  1586
  should qualify for re-enactment under Bills such as this.
  The important factor for the county council in seeking the powers has been the demands on police manpower. In the case of a major procession it is necessary to make advance arrangements for the cancellation of policemen's rest days, to divert other police from their normal duties and to arrange for the erection of barriers as necessary to close side roads. The exercise also involves a careful husbanding of police service morale. This is naturally disrupted if cancellations of leave and alterations of duties sometimes substantial—have to be arranged without notice.
  The powers in the Cheshire County Council Act 1953 have not applied since 1974 to the whole area of the new county and in particular do not extend to the former county boroughs of Chester and Warrington or to that part of the former Lancashire county which has come within the Cheshire boundary. Enactment of clause 29 should therefore regularise the unified treatment of the whole county under this power.
  I repeat that there is no intention in the Bill to fetter the freedom that Cheshire has enjoyed for a long time, which it has exercised responsibly and liberally, and which it will continue to exercise responsibly and liberally. I commend the Bill to the House.
  7.38 p.m.
  Miss Jo Richardson:I want to address myself to clause 29. As Conservative Members will have noticed, a large number of us on this side—I am pleased to see that some new Members have joined us in this exercise—feel strongly about the inclusion in the county council Bills which have been coming forward in the last few months of provisions which strike at the right of people to demonstrate without necessarily being obliged to notify the police in advance—whether 36 hours, three days or seven days. This is a deeply held right in this country, although not written into the law in any constitutional sense.
  Mr. Goodlad: I am sorry to interrupt the hon. Lady so early in her speech. Does she acknowledge that the clause does not govern spontaneous demonstrations but is concerned only with organised street processions?
  Miss Richardson: The hon. Gentleman does not quite understand the words in the clause. Those who have a spontaneous demonstration could equally be caught by the provisions of this Bill. They are the people we are out to protect. We seek to protect their right to demonstrate in an organised way, but on a spontaneous basis. I do not understand the point the hon. Member is trying to make. What is "organized" and what is "spontaneous"?
  We must remember that we are discussing not simply the interests of those who live in Cheshire but those of everyone in this country. If we go on enacting such clauses in Bill after Bill, we shall eventually cover the length and breadth of the United Kingdom and everyone's interests will be injuriously affected. A precedent will be set and we shall never get rid of it.
  This country is a signatory of the Universal Declaration of Human Rights. Article 20(1) provides that everyone has the right to freedom of peaceful assembly and association. We are also a signatory of the European Convention on Human Rights, and have ratified article 1(1), which also provides that everyone has the right to freedom of peaceful assembly and association. Neither of these items has any standing in British law, but our international obligations must surely imply a presumption in favour of freedom of peaceful expression and association. I do not think that we should go against the spirit of those articles.
  I have forgotten how many times we have debated this point. In our previous debates there has been reference to the judicial consideration which was given by Lord Scarman to the proposal that it should be an offence to organise a demonstration without prior notice. It is worth repeating that in the report of his inquiry into the Red Lion Square affair Lord Scarman said that he saw no justification for agreeing with this proposal. He said that he saw no reason why it should be accorded merit or written into our law. The former Home Secretary, my right hon. Friend the Member for Leeds, South (Mr. Rees), now sitting below the Gangway, in February 1978, when talking about the Public Order Act, said that, although he was having discussions with the police, he could see no reason why, at that stage, there should be a change in
  1588
  the law. From my investigations of this Bill and my contacts with the people in the area—I have a few—I have learnt that there has been a good deal of local opposition to the inclusion of this clause. The county association of trades councils—which comprises nine local trades councils—has been campaigning against the inclusion of this clause.
  Mr. Barry Porter: Perhaps the hon. Lady would like to give details of those organisations or people, other than the local trades councils, who have objected to the clause.
  Miss Richardson: The hon. Gentleman is somewhat impatient. I was about to tell him. The North-West region of the TUC, which covers Cheshire—I checked that this afternoon—passed a resolution which was against the introduction of these provisions. I have also been in contact with Friends of The Earth. This organisation has 230 local groups throughout the country. I understand that it has a group in Cheshire. Friends of The Earth, as those who are interested in such matters will appreciate, tends to run local campaigns. It looks out for matters affecting local areas in addition to its national campaigning. It watches out for issues in a locality and action taken upon them is principally the function of the local group. I understand from it that it has good relations with the police and that it does notify the police in advance as a matter of courtesy—as do most organisations. The North-West region of the TUC and the trades council do so.
  The fact that such organisations would have to notify the police would take away that element of spontaneity, of thinking up a demonstration and holding it immediately. That would be gone if we allowed clause 29 to be enacted. There could be an issue arising on which it would be difficult or even impossible for the necessary amount of notice to be given to the police. People run away with the idea that organisations do not notify the police. In their own interests they try to do so whenever possible.
  Suppose that there were to be another Flixborough—although I hope that there never will be. An organisation such as Friends of The Earth, and doubtless many other people resident locally, would want to demonstrate on such a matter and

  1589
  would probably want to do so within a matter of minutes or hours of such a disaster. It would not necessarily follow that there would be time for such a demonstration to be notified in advance to the police. We should not place upon people the necessity of having to give such notice.
  Mr. Eldon Griffiths: Can the hon. Lady give any example where the police have been so foolish as to react to a spontaneous demonstration carried out peacefully? When, for example, have they used the powers provided in the Merseyside County Council Act in the manner she is suggesting?
  Miss Richardson: I do not know when the police have used these powers. If they have not used them, as the hon. Member seems to be implying, why are we discussing this matter? Why have such a provision? If the police will take the attitude that everything will go on as before and no action will be taken—that there will be no fines of £200 imposed—I do not know why the promoters are bothering to include this clause.
  It was interesting to read some of the discussions which have been taking place in the United States on this point. I have some links with the American Civil Liberties Union—not very close ones, but I get some information from it. This issue has exercised its mind. I understand that a number of courts in the United States believe that the requirement of notice is unconstitutional in American law. I know that we are discussing not American law, but British law, and in particular Cheshire county council law. It is interesting to note the American experience. I understand that the bulk of it has shown that no requirement of notice is quite the best way genuinely to ensure that there is the right of freedom of speech and assembly. In the United States it is traditional to notify the police as much as possible in advance of any demonstrations which are to be organised. But the requirement to do it is what raises the difficulty. In particular, I understand that the identification requirement has, in the words of one judge in one court in the United States, had
  "a chilling effect on legitimate assembly."
  I think that the House will understand
  1590
  that where one person or one organisation has to be held responsible and is liable to fine or other sanction, as is proposed in such a clause as this, people can be inhibited from ever having demonstrations at all.
  We all want to see people allowed to demonstrate peacefully, where they wish to do so, with no question of disturbing other residents or passers-by on the public highway. Most people, and certainly most organisations, will as a matter of routine get in touch with the police and make proper arrangements. But, surely, we must retain the right of everyone in this country to demonstrate without the legal necessity of having to notify the police in advance and being subject to the sanctions written into the Bill.
  7.51 p.m.
  Mr. Eldon Griffiths: I wish to speak briefly on this matter, and the House knows my interest as parliamentary adviser to the police service.
  I start with a general point. I do not like the way in which we are dealing with this matter piecemeal in a series of local authority Bills. It is a national matter. It would be far better if we could arrive at some sensible agreement in the House, the basis of which the Government themselves could put forward, so that the police, wherever they were, and the local authorities would know exactly what the position was.
  I have attended most of these debates, though not all—
  Mr. Rooker: Not the West Midlands one.
  Mr. Griffiths: I missed the West Midlands one, as the hon. Gentleman never fails to point out. If I had been here, he would not have won the point. But, as I say, I regard it as unsatisfactory that county councils are having to deal with this matter on a piecemeal basis, albeit by standardised clauses, It is a national problem. It should have a national response, and I am sure that that is what both the right hon. Member for Leeds, South (Mr. Rees), who tackled these problems, and my right hon. Friend would prefer.
  There is, of course, the special problem of London. I need not go into that,

  1591
  but it is probably true that the Commissioner in London and the police authority, who is the Home Secretary, must have special powers because of the special nature of London, and it is in all probability unnecessary to extend those quite considerable London powers to the rest of the country. Therefore, whatever we did nationally, we should probably have to make some exception in any event for London. Nevertheless, I think that the time has come to sweep up these matters in some nationally agreed clause. It could perhaps be included in county council Bills, but it ought to be a matter agreed at national level.
  My second general point is that I welcome the change from the seven days' notice to three days' notice. I am not exactly sure what the position is here. I do not know whether Merseyside, where the amendment was accepted, now has three-day notification and whether the West Midlands, where it was removed, has no notification period at all or has a seven-day notification period. I am afraid that I do not know the facts in that respect. But what I am clear about is that where there were, for example, two county council areas with different requirements and it was possible for a procession to go from one into the other quite legitimately, that would place both the public and the police in an absurd situation.
  Mr. Andrew F. Bennett: If the hon. Gentleman looks at the Order Paper he will see that the position on the West Midlands Bill is that it has been reported without any clause on processions in it, but there are amendments down which seek to put in such a clause.
  Mr. Griffiths: I think that my point is made. We need to deal with this matter on a national basis, though I welcome the changes which have been so eloquently proposed by my hon. Friend the Member for Northwich (Mr. Goodlad). I think that the intervention of the hon. Member for Birmingham, Perry Barr (Mr. Rooker) on the question of funerals answered my point.
  I have three small points to put to the Minister and the promoters. The police in general—I speak of the Police Federation—welcome the clause because they think that it is right that notice should be given where an organised procession
  1592
  is to go through the streets of any city. It will be within the recent recollection of the House that there have been appalling encounters where one group of people perhaps on the far Left of politics and another group on the far Right have almost deliberately chosen to have processions through the same areas at the same time. The police have found themselves in the middle. People on both sides have been hurt.
  That state of affairs is unacceptable for us in this country, and it therefore follows that there must be notification and there must be a chance in advance for the police to agree with the organisers which routes they will use and at which times of day they will process in order to avoid the clashes which none of us wants to see.
  Mr. Andrew F. Bennett: Will the hon. Gentleman explain the Police Federation's attitude to the counter-procession as opposed to the counter-demonstration? I ask that because of the way in which he is illustrating his point. If one person is given the exclusive right for his procession to go through, because he has given the minimum notice so that no one else can organise a procession on the same day, it means that people stand around on the sidelines and, unfortunately, do what they can to disrupt it. I should have thought—many policemen have expressed this view to me—that it would be preferable if it were arranged for someone else to organise a counter-procession held sufficiently far away so that the two groups did not come to blows.
  Mr. Griffiths: That is precisely the point that I was trying to make. The police invariably find themselves in the middle. I say at once that they do not particularly like to protect either the black Fascists of the National Front or the red Fascists of—occasionally—the Anti-Nazi League. They do not like to do that, but in a free society it is their job to do it.
  I think that it is a matter about which we can be perfectly sensible. If in any one built-up community there are to be three, four or five processions—let us recognise that in many of our big cities there are often as many as that almost every weekend in the summer—elementary common sense requires that there be some arrangements so that they do not clash.

  1593
  The hon. Member for Stockport, North (Mr. Bennett) makes the point that people will stand on the sidelines and jeer and occasionally throw stones. It is a simple matter. If they break the law, they must be stopped. If they do not break the law, they are exercising their rights. But the difficulty for the police is that they have to stand between two rights—first, the undoubted right of the citizen to organise, to process and to protest, and, secondly, the other right of the citizen not to be prevented from going about his lawful business in peace, not to have his home and his garden damaged, and so on.
  The police must see that both those sets of rights are preserved. They can do that only if they are given reasonable notice of what is to happen. They are told who is organising the procession so that they can deal with him. Very often, if they know the names of the organisers, they will sit down and go to considerable lengths to help the organisers make their procession successful. The police have an interest in seeing that the rights of the citizen are not only protected but are successfully asserted. They seek to do that. But they cannot possibly do it if they do not know who is organising the procession, where it is to go and at what time of day it is to take place.
  Mr. Stuart Holland: The hon. Gentleman spoke of the red Fascists of the Anti-Nazi League. Is he implying that all members of the Anti-Nazi League are Fascists, and, if not, will be withdraw that remark?
  Mr. Griffiths: Of course, I am implying no such thing. I am talking generally. There are in the National Front black Fascists, and there are, in my view, a number of red Fascists in the Anti-Nazi League. I do not like either of them. I was simply saying that the police have no desire to be thought to be on the side of either. They are only on the side of the law and the balance of the two sets of rights, the right of the hon. Gentleman to protest and my right, if I happen to live in the same neighbourhood, not to be prevented from going about my lawful business in peace. The police have a difficult task. Surely it is reasonable that they should be given notice and the names of organisers so
  1594
  that they may have a constructive discussion and indication of the times of processions and thus try to avoid clashes.
  A few of the hon. Members who talk about these matters seem to think that the police service is anti-freedom. Because the police have to protect those whom those hon. Members think that the police do not like or with whom they disagree, they are on the side of those groups. That is not so. In my view the police are the best guardians of freedom that we have. We should be giving them support and not removing it.
  In the end, it is a matter of resources and good will. The police service is overstretched. It does not have enough manpower, and it has insufficient resources If large numbers of police officers are taken away from neighbourhoods to protect protest marchers, organisations and demonstrations, it should be accepted that those who pay the price are citizens who live in the neighbourhoods from which police officers have to be removed to carry out other duties.
  It happens all too often, especially in London, that 5,000, 6,000 or 7,000 police officers have to be removed from their duty of protecting the neighbourhoods of London to be present at demonstrations in the centre of the capital. The result is that many citizens find that crime, larceny, hooliganism and vandalism increase in their neighbourhoods. They have to pay the price. The elementary utilisation of police resources means that it is sensible to give the police service, by notice, the opportunity to use its manpower properly.
  I hope that the clause will be accepted without too much contention. The time has come when we must have a national clause—with the exception of London—which will bring about standardisation throughout our legislation.
  8.3 p.m.
  Mr. David Alton: First, I quote from a brief produced by the National Council for Civil Liberties earlier this year, which states:
  "The National Council for Civil Liberties considers that the proposals, if implemented, would be a serious limitation on the freedom of association and expression. It is disturbing that the law can be amended in such a fundamental way through the introduction of private Bills by local authorities".

  1595
  That echoes a view that was expressed by Lord Justice Scarman, who after the Red Lion Square inquiry said:
  "It cannot be said too often that our law assumes that people will be tolerant, self-disciplined and willing to co-operate with the police. The assumption is still sound: that is why the police go unarmed, and also why, with no legal requirement of notice, the police are in fact notified in at least 80 per cent. of the cases. There are some who—law or no law—would never give notice: but they are on the very fringe of our society and should not, I suggest, force upon the law a largely unnecessary requirement, which can at times be an embarrassment to law-abiding citizens."
  I have quoted those views because I feel that a back-door method is being used to make major changes within the law. Local Bills are largely innocuous measures dealing with the closing of parks, the parking of caravans, the paving of yards and basically local matters. By using local legislation to make major changes that will affect people's basic rights and freedoms, local authorities are sneaking in measures that the House has not properly debated or aired. In that way the House is being prevented from expressing a proper point of view on national legislative change.
  If the House accepts the Bill, any organiser who fails to give the necessary notice and is found guilty of an offence will be liable on summary conviction to a fine not exceeding £200. However, in 80 per cent. of demonstrations the police are notified voluntarily. Major demonstrations of the type that pose a threat to public order need to be publicised if they are to be effective. The police know well in advance that such demonstrations will take place. They have ample warning.
  The hon. Member for Bury St. Edmunds (Mr. Griffiths) spoke about the thugs and bully boys in the Anti-Nazi League and those on the far Right. There could be people in such groups who will not give notice in any event, law or no law. At present the courts are left to implement the provisions of the Public Order Act 1936. Surely the provisions in that measure should continue to apply. It is a dangerous precedent to sneak through local legislation that will restrict the right of association. The supervising of demonstrations is not like looking after the Chester Walls. Surely the right to demonstrate is the political privilege of every Briton, or it should be.
  Mr. Eldon Griffiths: How is the right of the citizen limited if he has to tell the police in advance where he is going so that he does not clash with somebody else?
  Mr. Alton: There are spontaneous occasions when there is a wish to demonstrate because, for example, a child has been caused an accident while playing in the road, because a Conservative-controlled authority has introduced massive rate increases, or because there has been an industrial injustice. Advance notice will prevent that type of a spontaneous demonstration. It is significant that the original provision in the Bill was to limit the period of notice to seven days instead of three days.
  There are many inconsistencies in the various local Bills that have been introduced. For instance, in Tyne and Wear no notice is required. In the Isle of Wight the requirement is seven days, as it is in Greater Manchester. On Merseyside three days' notice is required. A reduction from seven days to three days is sought in Cheshire.
  It is true that there were many anomalies among the old authorities. There was a hotch-potch of legislation. I understood that the reason for the Local Government (Miscellaneous Provisions) Act was to harmonise and rationalise local legislation. However, we are introducing more inconsistent legislation. From area to area the public will be unaware of the application of the law. It could be caught in different laws in different counties. The application of the law could be different on each side of a river.
  Liberals view with great concern the possibility that seven days' notice will be required in most of the country for the holding of street processions. That poses a serious threat to individual political rights. We deplore any breach of public order. However, the seven days' requirement will hit hardest at spontaneous small-scale demonstrations that pose no threat to public peace. The relevant clauses are misguided, however good the original intentions might have been. There are already sufficient limitations on our freedoms and the right of peaceful assembly. We should be especially concerned to stop any further erosion of our civil liberties.

  1597
  Conservative Members speak a great deal about the need to strike redundant provisions off the statute book. The Bill is promoting more inconsistencies within our legislation and more provisions that will have to be repealed.
  8.8 p.m.
  Mr. Barry Porter: I support the Bill and the clauses that we have been discussing and I pay tribute to the work that has been done by the county council and its officers, especially to Sir John Boynton, whose going I regret. I pay tribute to the officials of the Ellesmere Port district council, who have done so much work in preparing the Bill.
  My constituency is in two areas. Part of it is on Merseyside and the other part, the area that we are discussing, is in Cheshire. The odd situation may be envisaged whereby a procession could be legal in one part of my constituency and illegal in the other on crossing a road. That is nonsense and goes some way to supporting the argument of my hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths) and, as I understand it, of the former Home Secretary—namely, that these matters should be dealt with nationally. I support that view. Nevertheless, it is a Cheshire County Council Bill and that is how we must deal with it.
  When I first read the Bill and the Instruction I wondered what it had to do with the rolling plains of Cheshire, as it was difficult to imagine that there would be riotous assembly, danger and trouble in those areas. However, my attention was drawn to what occurred in Ellesmere Port in 1971. Much has been said by hon. Members on both sides, and especially by the Opposition, about the rights of the demonstrators.
  Mr. Alton: Will the hon. Gentleman say how many people were arrested as a result of that incident in 1971? What damage was done to property as a result of it? Would it have occurred if there had been this provision in the legislation?
  Mr. Porter: That information is not available to me. Presumably the hon. Gentleman knows those figures. I do not. However, the hon. Gentleman's argument
  1598
  in favour of spontaneity is an argument for possible trouble. I am concerned not only with the rights of demonstrators and processors but with those of the people around whom they process and against whom they demonstrate.
  Mr. Andrew F. Bennett: At that time was not there a requirement in that part of Ellesmere Port to give at least 24 hours notice? As that provision did not solve the problem then, why would a requirement now solve it?
  Mr. Porter: That would be like an argument against the law of murder because some people did not observe the law. The purpose of this legislation is the provision of a safety net.
  At least 80 per cent. to 90 per cent. of demonstrators, as a matter of courtesy and practicality, inform the police of their intentions, rightly and properly so. This clause will not apply to the 80 per cent. or 90 per cent. who behave in a reasonable and civilised fashion. It is meant for the 5 per cent. or 10 per cent. who have no intention of behaving in a reasonable and civilised fashion.
  Hon. Members may care to consider whether a spontaneous demonstration, about which we are arguing, is desirable. Flixborough was mentioned. Is it of necessity right that, as soon as there is a ghastly occurrence, people should take to the streets to protest, without knowing the circumstances, without considering, without reflecting? That is the way to make a bad decision. It results in people being on the streets when tempers are running high and feelings are extremely heated. That is where danger occurs—not in a demonstration that takes place two or three days later when people have had time to reflect. That does not mean to say that their feelings are any less strong. However, they may well participate in an organised, orderly but nevertheless strong demonstration. I do not understand why the Opposition are so excited about the matter.
  Mr. Rooker: I know that the hon. Gentleman represents Bebington and Ellesmere Port. People living around Flixborough for several years might have complained about unsafe practices. This does not apply to Flixborough; this is an example. Something might have happened that they forecast and expressed

  1599
  concern about, but about which there was no action. When the crisis occurred they would not have discussed the matter for two days and then decided to demonstrate. Of course not. This is the point. This is where the spontaneity is involved.
  A spontaneous demonstration may occur in the case of an accident black spot, where accidents have repeatedly occurred in the same place and where people have been repeatedly killed. That is when a demonstration would arise. If there was no problem, there would not be an issue about which to demonstrate. The hon. Gentleman must be realistic.
  Mr. Porter: I concede that I am not in the business of going on demonstrations. However, I take the point made by the hon. Gentleman. Perhaps my hon. Friend the Member for Bury St. Edmunds would confirm this. It is highly unlikely that in such circumstances any action would be taken by the police to prosecute.
  Mr. Andrew F. Bennett: There is a large oil refinery close to the edge of the hon. Gentleman's constituency, if not in it. Let us assume that there was a story in this week's local newspaper that there were unsafe practices there. Would the hon. Gentleman advise his constituents to wait for a week or two before organising a demonstration to demand that the unsafe practices cease? He would not. He would ask for immediate action to be taken. But if he organised a walking protest he would be in breach of the law if he did not wait. The hon. Member for Bury St. Edmunds (Mr. Griffiths) disagrees. It is not a good law if it allows the police to choose whether to prosecute or approve or disapprove. There should be a right to demonstrate, ideally, giving the maximum notice to the police. However, sometimes, because of the nature of the urgency, notice cannot be given. Therefore, in those circumstances people should be entitled to demonstrate.
  Mr. Porter: May I put the argument another way? There are ways of demonstrating and showing disaffection, anger or other emotion other than by holding a street procession. This clause relates to street processions. If the Opposition cannot think of any other way of indicating their anger or disapproval,
  1600
  perhaps I may be able to enlighten them elsewhere.
  The arguments advanced by the Opposition do not take account of the danger to people who live on the streets where the processions take place. That is what concerns me.
  The hon. Member for Barking (Miss Richardson) made no reference to those not involved in demonstrations, who presumably are not interested and do not care. Why cannot the Opposition see that there must be counterbalancing forces? There is the right to demonstrate and assemble. Equally, individuals who do not want to be upset or bothered have a right not to be involved in that assembly. They have the right to pass and repass over their roads. It must be correct for the police to make the appropriate arrangements.
  I am sorry to say this. It appears to me that on some occasions at least the Opposition assume—in some degree—that the police are not sympathetic to whatever demonstration is going on. I give my sympathy to the police in the circumstances that arise, especially in the major cities. The circumstances described will largely arise in Cheshire.
  Mrs. Dunwoody: This is a Cheshire Bill.
  Mr. Porter: I am obliged to the hon. Lady for that information. I was aware of that. Although the Bill refers to Cheshire, it relates to a large number of other places. If not, the hon. Member for Birmingham, Perry Barr (Mr. Rooker) would not be here. I understand that he, too, was present in the debates on the West Midlands and Merseyside Bills. He treats this as a national matter. If I stray from the clause I do not apologise, as I also treat it as a national matter.
  I was interested in the views of the hon. Member for Liverpool, Edge Hill (Mr. Alton), who could think only of demonstrating about Tory-controlled authorities, which is typical of any Liberal contribution to a debate of this kind. The hon. Member talked about political privilege and inconsistencies of notice. Indeed, there are inconsistencies—there always have been, I understand—in local government and local government Bills.

  1601
  I see no virtue, necessarily, in all local authorities having exactly the same provisions. I have been told that on a previous occasion in another place that was part of Liberal philosophy.
  I do not want to detain the House for much longer, except to say that this is a perfectly sensible clause and that sensible, practical people will see no harm in it. The list of people given by the hon. Member for Barking as being opposed to the clause, in my view, can only be seeing principle where none exists. If it is any comfort to the hon. Lady, however, I share her view about launderettes being zero-rated for VAT. Perhaps we might be able to agree on that as a matter of principle in due course.
  The Bill has taken some time to get to the present stage. The activities of some, including, perhaps, some Opposition Members, have caused a great deal of trouble and expense and—
  Mr. Rooker: The hon. Member for Bebington and Ellesmere Port (Mr. Porter) must not come to this place and criticise any hon. Member, whatever side of the House he or she is on, for operating within the rules of procedure and articulating the problems that constituents have raised. If it causes the hon. Gentleman, his party or anyone outside inconvenience and extra expense, so be it. That happens to be what this place is for—to air such problems. There is nowhere other than the British House of Commons that one can go to raise such issues.
  While I am on my feet I should like to ask the hon. Member for Wirral (Mr. Hunt), through the hon. Member for Bebington and Ellesmere Port, one question. He concluded by saying that reasonable people would accept the clause. Does he mean reasonable people such as the promoters of this Bill? For example, if this clause was removed on an Instruction so that it did not go to Committee, and if at some subsequent time during the passage of the Bill, which still has a long way to go, the hon. Member himself tabled the clause again on the Floor of the House, would the promoters of the Bill be prepared to say now that they would agree to the clause being recommitted to the Committee so
  1602
  that the petitioners, who have spent money and time organising their petition, could have their petition served?
  That is part and parcel of my original point of order. I should be grateful if, at some time during the course of the debate, the promoters could give their views on that matter.
  Mr. Porter: Obviously I am not in a position to reply to that question. I am quite certain that my hon. Friend the Member for Wirral (Mr. Hunt) has instructions on that point and will deal with it when he winds up.
  I believe that it ill behoves the hon. Member for Perry Barr to remonstrate with me for expressing my deeply held views. It is perfectly valid for me to mention the fact that people are causing expense and inconvenience. The hon. Member may think that, in the circumstances, he is justified in causing inconvenience and expense, but I am equally entitled to hold a contrary opinion.
  8.22 p.m.
  Mrs. Gwyneth Dunwoody: One of the advantages of having been released from my previous European incantations is that I am able to spend more time taking part in debate on the Bill before us. I have followed previous debates on this subject with great care.
  I have the great honour of serving Cheshire county as one of its Members, and I have had the advantage, over a number of years, of learning about the special character of Cheshire men and women. They are unique and have a quality of self-confidence that is sometimes mistaken by people outside the county as an ability to push people around. One aspect of the character of Cheshire people which shows itself when people talk about the removal of liberty and freedom of assembly is that they become angry, and they are wont to make their anger felt—not heatedly, but effectively.
  Before the House lightly passes a clause such as the one in the Bill referring to the freedom of assembly, it should realise exactly what it is doing. The hon. Member for Bury St. Edmunds (Mr. Griffiths) said that this was a reasonable requirement and there was not reason why we should oppose it. I agree with him wholeheartedly when

  1603
  he said that the way to bring about a change in the Public Order Act is not to use a tiny clause slipped in among the dustbins of the Crewe corporation. That is an unwise precedent to set.
  There is one other thing that we should guard against, and that is people who come to this House and say unreasonable things in very reasonable tones. The law of assembly has been fought for by this Parliament over many centuries. It is not something that has been acquired lightly. It can be chipped away, limited and changed.
  Many centuries ago a gentleman called de Tocqueville set out his analysis of why British democracy worked. If there is one thing that we can see from our European colleagues not 10,000 miles away, it is that we are extremely blessed in having a politically stable society. I do not know how long it will last, but we in Britain benefit from a system which allows people to express their anger in a parliamentary and democratic fashion and in normal spontaneous street demonstrations.
  It is important that we should realise that the Bill is the wrong way in which to bring about this change. But I realise that it is also intended to set a precedent for other areas.
  As a small child I took part in many demonstrations in the East End of London and, with both of my parents, I saw what it was like when people chose to bomb someone with soot and flour as he passed by their headquarters. These were people who were not themselves demonstrating against others. They were people who stood on the roof of the Fascist headquarters in the East End of London and threw things at those who were democratically demonstrating in the street below.
  I have considerable reservations about the arguments that the hon. Member for Bury St. Edmunds has been putting forward this evening. I do not believe that his suggestions will necessarily solve the problem of those who want to use the democratic processes to achieve power in order to subvert it for their own ends. When we contemplate any change in the law, it is essential that we are aware that there will always be people who will use existing powers for ends other than those for which this House has agreed them.
  1604
  I am not entirely without fault in this matter. As a tiny cog in a large machine I have stood at that Box and said "Of course you are wrong. You are misinterpreting what this law says. It does not really mean what you think it says. It simply means something extraordinarily limited." The House has a responsibility to pass precise laws which mean what they say and not what we think others will interpret them as meaning.
  The Cheshire county police, on the whole, are a fairly sensible body of men. I do not have any real argument with them. I find them to be well aware of the problems of policing a county which contains so many mixed elements. The Cheshire police are loth to do anything that would in any way exacerbate any kind of differences between one group and another. However, it is not always easy for even experienced police officers to take decisions that will have a political impact.
  I should like to relate a particular instance. A group of students in my constituency decided that they wished to picket a certain well-known educational establishment. It was rather an effete, middle-class picket, because the students took their chairs on to the grass by the doorway in order to sit there. Nevertheless, it was an occasion of extraordinary calm and considerable discipline—until, because a junior Minister happened to be visiting the establishment on that day, the local superintendent of police, with the best will in the world, appeared with a bus load of uniformed policemen.
  Those police officers were not required. They had not been requested. There was no obvious explanation for their arrival—except, perhaps, the desire to be over-careful. But the result was very interesting. What had been an astonishingly boring and rather timid demonstration showed distinct signs of stepping itself up into a minor riot. It was only because of considerable efforts by some of the staff and the fact that it was pointed out that this was just an extraneous arrangement that the students were convinced that great actions were not being taken against them and that the police had not been requested by anyone concerned in the establishment.

  1605
  No one could say that that superintendent was wrong. He was simply interpreting what he thought might happen. This little clause says, in effect, that the power of decision and interpretation will rest with the police force. The demonstration may be against the local authority, a particular kind of industry or even another trade union—all sorts of disputes arise in the streets—but if people suddenly become exceedingly angry they need to work off that anger in a disciplined way. They need to be able to demonstrate openly to others what they feel. It is the spontaneous quality of that combustion that makes it important that it should evaporate in a way to cause the least damage. With the best will in the world, a police officer with powers of this kind and faced with that situation could take the wrong decision.
  Mr. Eldon Griffiths: The hon. Lady is making a perfectly valid point, but on a different subject. Nothing in the clause gives the police the ability to do anything but discuss with the organisers of the procession the route and time that they choose to move.
  Mrs. Dunwoody: The hon. Gentleman is mildly naive if he feels that those things in themselves will not have a political impact. They will have a considerable impact on the sort of demonstration that takes place. If these changes are to occur, they must be undertaken in the context of a much larger Act, where they can be openly discussed.
  Certainly in Cheshire it cannot be demonstrated that there is need for these extra powers. There was no real problem with a limited power of notification. If the police cannot demonstrate that even in the past eight years there has been a need for extra powers, why are they being included? It is being said that the need for these powers cannot be demonstrated but they might be needed in the future. There is no genuine evidence that they are needed.
  It is a diminution of civil liberties to change and limit the ability of ordinary people to demonstrate their feelings.
  Mr. Eldon Griffiths: Whatever view the hon. Lady takes, she must recognise that over the past few years, as in the 1930s, there have been occasions when
  1606
  groups of highly motivated people from one side of the political spectrum have clashed in the streets with people from the other side. That happens in a racial, industrial and ideological context. In those circumstances, it is elementary to public order, and therefore freedom, to arrange for both sides to process and demonstrate in a way that will avoid clashes and injury to large numbers of people, as has happened in Southall and other parts of our country.
  Mrs. Dunwoody: That argument will not do if one is seeking changes in particular areas. If there was evidence that such changes in public order were needed, the measure would have to come before the House and be debated openly. The police, trade unions and other voluntary organisations would have to be allowed to give evidence. That is not happening. In the legislation on caravans in front gardens, there is a change in the law to limit people's actions in a positive manner.
  It has been implied that the TUC in the North-West does not need to be treated seriously. I assure hon. Members that in Cheshire if we believe our rights are being attacked we respond. It is precisely because there is no evidence whatsoever to show that Cheshire needs a change in the Public Order Act that Cheshire MPs feel that it is necessary for them to take part in the discussion on this Bill.
  I have discussed this Bill with the Cheshire county council. We were able to reach agreement. One of the things that saddens me is that we have had to go on as long as we have with this Bill, when it is obvious that hon. Members have considerable misgivings after the discussion that took place on the West Midlands County Council Bill. I would have hoped that there could be a greater and more flexible response, and not simply that we arrive at this point in the discussion, only to find the Cheshire county council saying that it is prepared to withdraw the original period of notification and halve it. If it can be halved as lightly as that, why did it have to be increased at all? Not one hon. Member from Cheshire, or anywhere else, has demonstrated that we need it. All they can say is that it is possible that there might be some future occasion when it

  1607
  would give some extra support to the police if it allowed them to rearrange routes.
  That argument might have some effect in areas where the police forces are badly overstretched. The interesting thing about the Cheshire county council is that for almost all the time its police force is up to strength. This proves that, short of an extraordinary explosition of ill will—which we hope we shall never see in Cheshire—they are able to cope with the political changes that take place. Therefore, I cannot see that there is any argument for this clause. It is not needed.
  Mr. David Hunt: Presumably the hon. Lady has had some discussions with the police about this clause before speaking about it in the House. Is she aware that in her constituency there is at present a provision for notice? In almost all cases where notice is given, it is usually at least one week's notice. In this clause the notice is only three days. Does she not, therefore, recognise that the promoters are merely exercising their right to reproduce the existing situation and at the same time halve the normal period of notice?
  Mrs. Dunwoody: The one thing that I enjoy in my constituency is its enormous stability. We do not have violent demonstrations. Until recently we have not had any Conservative-controlled authorities of the kind that one hon. Member spoke of tonight. Perhaps I should not be too sanguine and say that at some point in the future there will not be some enormous demonstration against the existing authorities. I cannot say that we always approve of everything that the county council does, but the fact is that we have not had the violence in the streets that seems to demand the enshrining in a Bill of this unnecessary provision.
  Over the years in this House people have sought to say that they are not seeking to limit the honest rights of reasonable men, only the right of unreasonable men. The older I get, the more I believe that everybody's definition of "unreasonable" is different. I may believe that the man who has been pushed beyond the point where he can cope with homelessness or domestic difficulties, and who breaks a window in the local authority's offices, has been pushed to a great extent
  1608
  by forces outside himself. I do not excuse him, but I do not believe that he is acting altogether unreasonably.
  Mr. John Evans: Does my hon. Friend accept that this clause, which we are told deals with the attitude of reasonable men, will mean that unreasonable men will not obey its provisions? The unreasonable men—the extremists of Right or Left—will not give notice to anybody because they will be only too happy to take to the streets and have the punch-ups that allegedly they were looking for in the first place.
  Mrs. Dunwoody: One of the hazards of this type of change is precisely that outlined by my hon. Friend. He and I have one thing in common, namely, that we spend a great deal of our time with our constituents dealing with the problems of their industrial and domestic lives. We know that the one thing that one must never do to any Cheshire man is to limit his sphere of activity. He takes unkindly to it—so unkindly that one may produce the very response that one is seeking to limit. There is no evidence that one can bring to show that this change is in the interests of my constituents, or anybody else in the county of Cheshire.
  I wish that this clause had been withdrawn before the Bill was brought on to the Floor of the House. I can only hope that good sense will now prevail.
  8.43 p.m.
  Mr. Ian Mikardo: I shall later take up the remarks of my hon. Friend the Member for Crewe (Mrs. Dunwoody) and others in directing attention to some of the difficulties that arise from clause 29 and some of the disturbing features of that provision.
  Before I do so, I wish to deal with the three motions in the name of my hon. Friend the Member for Stockport, North (Mr. Bennett) seeking the committal of clauses 6, 7 and 8 to a Committee of the whole House. Those clauses empower the county council to give three different forms of assistance to industry. However, as I read the clauses, the assistance could go to organisations engaged in other commercial occupations than industry.
  I regard it as a proper use of the finances and assets of a local authority to give aid of this sort. My own local authority gives such aid, and I am very

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  much involved locally in a voluntary organisation which helps the authority to do so. I have nothing against the objectives which the county council seeks in these three clauses. However, I believe that the county council has not thought through the detailed problems which can arise from the implementation of these clauses. They require examination to ensure that they will implement the intention behind them.
  The subject of aid to industry, whether from central or local government, is complicated. The setting of criteria in determining the proper recipients of aid and the amount and forms of aid are no light task. Let me quote one example of why I feel that the county council has not thought the matter through. Clause 6 empowers a local authority to make loans for industrial purposes to small firms, and "small firm" is defined as
  "an industrial undertaking which has no more than 100 wholetime employees."
  That is an impractical definition which avoids altogether the complications that arise when industries which are labour-intensive and those which are capital-intensive are considered. There are large, prosperous, hugely wealthy and highly profitable firms which have a great deal fewer than 100 employees in highly capital-intensive businesses. One company that is part of a group organisation can perform a specialist function that is concentrated in a relatively small unit. That company may carry out those functions for the benefit of other larger elements in the unit. There may be a tremendous turnover with a relatively small number of employees.
  The number of employees is no criterion of whether a firm is small. It may not even be small in a physical sense. There are whacking great power stations covering acres of land with only 30 employees. In the days of the silicon chip, that will become more and more the case. A firm is not necessarily physically small or commercially or industrially small because it has fewer than 100 employees. Other definitions have been made which are equally fallible, but if a definition is to be sought the various yardsticks must be considered—number of employees, turnover, profitability and capital investment. Alternatively, a formula which represents a combination of two or more
  1610
  of those criteria could be considered. It is a complex and sophisticated matter.
  I am sure that officers of county councils run those councils well. However, they do not know much about industry, or this highly oversimplified, unsophisticated and inadequate clause would not have been written into the Bill. That is why the Bill needs examination. The best way to do that is for the House to accept the three motions to commit those three clauses to a Committee of the whole House.
  I turn to the only subject raised so far in the debate—clause 29. A small point arises from an intervention by the hon. Member for Bury St. Edmunds (Mr. Griffiths). The hon. Member for Northwich (Mr. Goodlad) told us that the sponsors were proposing to include a provision to exempt from clause 29 a funeral procession and to exempt from obligation or potential blame under the clause a professional funeral director carrying out his job in the ordinary course of his business.
  The hon. Member for Bury St. Edmunds said that sometimes in Northern Ireland there were funeral processions with a political content. Is he asking the sponsors to include a clause exempting from obligation a funeral director organising a funeral procession unless that procession has a political content? A definition clause five pages long would then be needed. How is "political content" defined? As he often is, the hon. Gentleman was wrong. Occasionally the hon. Gentleman's enthusiasm to serve the Police Federation faithfully and give it good value for the money that it pays him runs away with his judgment.
  The hon. Member for Bury St. Edmunds got it absolutely wrong He spoke of the organisers of a procession being the political chaps—such as the IRA in Northern Ireland In fact, the man who is to be exonerated from the need to give notice is the professional funeral director. The poor old professional director cannot be held responsible for people who join in a funeral procession that he has organised, and he certainly cannot be held responsible for speeches made at the graveside The hon. Gentleman was talking nonsense.
  Mr. Merlyn Rees: I did not understand what was being said

  1611
  about funerals, but in an earlier debate it was pointed out that when there was a problem in the Midlands over the funeral of an IRA man, which would have led to trouble in the streets, my predecessor as Home Secretary used the Public Order Act to prevent the march. It is hardly possible to have a funeral without giving notice. There has been confusion about this aspect, and I am still not clear what is afoot in the Bill.
  Mr. Mikardo: I am obliged to my right hon. Friend. What was said in the previous debate applies with equal validity to this Bill.
  Death is something of which we do not always get notice. If the sponsors could arrange that we always got notice of when we would kick the bucket, we could go to a funeral director a couple of weeks before and ask him "Will you tell the chief constable of Cheshire that I am going to be buried next Tuesday morning?" We do not always know and we cannot always give notice.
  I remind the House that it is the practice of adherents of some religions to bury their dead as quickly as possible—sometimes on the day of death and certainly by the day after. They would be violating the principles of their religion if they had to give notice. That is why it is sensible that the sponsors should include the exemption. I am sure that they will not be so daft as to do what the hon. Member for Bury St. Edmunds asks and exempt from the exemption for funeral directors any director of a funeral with a political content.
  The hon. Member for Northwich said more than once that the arrangements in Cheshire had always worked well. He and the county council have every right to be pleased about that, but the hon. Gentleman did not answer the question why, if the arrangements had worked well, the county council was seeking a change. Of all the aphorisms that men use, the wisest is surely that one should leave well alone. Why is the county council not leaving well alone?
  The question of spontaneous demonstrations is a serious matter, and I invite the House to give it more serious and detailed consideration. Of course, we are not talking about the generality of processions. Most are fixed well in advance. I used to go on a long weekend
  1612
  procession every Easter. One good thing about Easter is that although it does not fall on the same day every year, we know the date well in advance each year. So there was no difficulty about giving substantial notice to the various police authorities of the areas through which that long march took place.
  Again, the one good thing about May Day is that we know, at least to within a few days, when it will be, so that if any trades council wants to organise a march that day it has no difficulty in giving notice, and the trades councils always give notice. I have taken part in different parts of the country. I have never been on one in which there was the least difficulty, and I am happy to say that I have never been on one which did not receive the best and most friendly co-operation and assistance from the police. I believe that there are some people who organise marches on St. George's Day. They know in advance when that is and they can give notice.
  But, as everyone in the House recognises, there are such things as spontaneous demonstrations. I caught my breath when I heard the hon. Member for Northwich say that spontaneous demonstrations were not covered by clause 29 and that they were all right. I am sure that he has been briefed to the contrary since then. If he will put down an amendment to the clause stating specifically that it does not apply to spontaneous demonstrations, and that no penalty arises for no notice being given of those spontaneous demonstrations, those of us who are at present causing him a headache will, instead call down blessings upon him and troop enthusiastically into the Lobby to vote for the Bill.
  Mr. David Hunt: I am so grateful to the hon. Gentleman that I rush quickly to my feet in the hope that I might get him in the right Lobby. The definition of "spontaneous" in the Oxford English Dictionary is that which is not organised. Clause 29 applies to processions which are organised. Will he not now reconsider what he has just said?
  Mr. Mikardo: If it were as simple as that, it would be very simple indeed. I just want the thing spelt out, and I think that we would have to have an amendment in the clause to make it clear. I repeat that if what the hon. Gentleman

  1613
  has said is the interpretation that the sponsors of the Bill put upon this provision, and they will spell it out in the Bill, all this argument falls to the ground. The fact that the argument has to go on is in itself evidence that the position is not quite as simple as the hon. Gentleman puts it.
  Mr. Dennis Skinner: I agree that the question of spontaneous demonstrations needs clearing up. My hon. Friend will recall that in 1972 the miners were engaged in a long battle with the then Tory Government to get a better wage deal. The Wilberforce committee was set up on a Friday. It deliberated and came to some conclusions. The then Prime Minister, the right hon. Member for Sidcup (Mr. Heath), decided that the dispute needed to be settled, quite dramatically, because of the loss of coal over a seven-week period.
  The result was that the miners' leaders left 10 Downing Street in the early hours of the Saturday morning, catching a train to Nottingham. They had no time to organise a demonstration, of course, but they went with the blessing of the then Prime Minister to try to get a spontaneous demonstration going in the streets of Mansfield and Chesterfield because the Tory Government were anxious that Lawrence Daly and the others should be seen to be recommending the new deal hammered out at 10 Downing Street.
  Therefore, in Mansfield, at 10 o'clock in the morning, with no time to do the thing under the premise of this Bill if it had applied at that time, but with the co-operation of the Tory Government, who wanted a ballot very quickly in order to get the miners back to work, Lawrence Daly and I and many others marched through the streets.
  So encouraged was the Establishment to see that we were actually trying to get the message over to the miners—well, I was not, but some were—with a view to getting them back to work under that wonderful settlement that it asked us to go to Chesterfield and do a similar demonstration in north Derbyshire. I was not very happy about that—it was my territory.
  That is an example, notwithstanding what we have heard, of the Tory Gov-
  1614
  ernment at that time actually willing a spontaneous demonstration. They did not want anyone to stand in the way of Lawrence Daly or Mick McGahey. They wanted them to march through the streets. They wanted the miners to get together to reach a settlement and return to work so that the power stations and the country could get back to work. That was a spontaneous demonstration. What would have happened under the Bill we are discussing tonight?
  Mr. Mikardo: I am grateful to my hon. Friend. The whole House is always indebted to him for his special insight into the industrial history of Great Britain. We profit a great deal from the information he gives and the education he provides for us. His remarks lead neatly to the next point I wish to make. Even if the sponsors wanted to respond to my invitation to amend clause 29 to exclude spontaneous demonstrations, they would have an awful job defining "spontaneous".
  It is terribly difficult. I appreciate that the hon. Member for Wirral (Mr. Hunt) intervened with the best of intentions. One cannot say that "spontaneous" is anything that is not organised. The example given by my hon. Friend the Member for Bolsover (Mr. Skinner) was an example of a spontaneous demonstration organised by a Conservative Government. It is not so simple as the hon. Member for Wirral says. There would have to be some definition. This is not theoretical.
  I want to draw attention to types of spontaneous demonstration that have taken place and do take place. If the hon. Member for Bebington and Ellesmere Port (Mr. Porter) believes that it is enough to wag his finger and say to a bunch of rightly angry people "Don't demonstrate. Wait a couple of days until you have cooled off", he only demonstrates that his knowledge of human nature is as incomplete as is apparently his knowledge of the history of his own constituency.
  I should like to give some examples. My hon. Friend the Member for Barking (Miss Richardson) mentioned Flixborough. A close example occurs to me. People who live in the vicinity of nuclear power stations and nuclear installations are always worried about the possibility of radiation leaks, as would any of us

  1615
  living in that environment and those circumstances. While we are in the middle of our worries and being reassured by the authorities three times a day after meals that there is no need to worry and that everything is safe, there is one day a bump. There is a Harrisburg bump, and the thing goes wrong. People will then and there march to the nuclear station and demand some protection, or they will rush to the responsible Minister. They will do something about it. They will not wait until they have cooled off. People do not act in that way.
  There have been similar demonstrations by people on the announcement of the route for a motorway which runs through the area where they live and where the things about which they care will be destroyed. What do we do when they get angry? We send for the hon. Member for Bebington and Ellesmere Port, who will come and say "No, no. Quiet, please."
  I know of a case where the mothers of children going to a certain school demanded a pedestrian crossing outside the school because half the children crossed a busy road in order to get to it. They nagged for a pedestrian crossing and were turned down. Then an eight-year-old girl was killed while crossing to school, and all the mums took to the street. If the hon. Member for Bebington and Ellesmere Port had wagged his finger at them and lectured them on the foolishness of their behaviour about taking to the street in anger, there would shortly have been a by-election in Bebington.
  I will mention another example, which I quoted in the debate on a similar Bill. An industrial tribunal has given an expensive judgment in the last week against a company which dismissed many of its workers at five minutes' notice. When workers are told at five minutes to four on Friday afternoon "Your job ends at four o'clock, so don't come in on Monday," and the head office of the plant is three-quarters of a mile away, they march there to see the boss. Some underling has told them that their livelihood has been destroyed at five minutes' notice and they want to see somebody bigger than the underling.
  I give one last and sad example. Unhappily, in the last couple of years, there have been a number of murders in East London, which prima facie seem to be
  1616
  racial. When a member of a community has been killed on the street in broad daylight and in cold blood, apparently because of racial hatred, how can one say to those people "Don't be angry, don't march to the local police station and demand action"?
  The hon. Member for Bury St. Edmunds said that the police were very understanding, that they never proceeded against people demonstrating spontaneously in that way. In that case, why do they want the powers to proceed? If they have never proceeded and have no intention of doing so, why do they need them?
  As the Bill stands, the police will be able to proceed against and secure punishment of people engaged in such spontaneous protests. I would ask the hon. Member, if he were here, why the police are asking for these powers if they do not exercise them and do not want to. After all, it is they, not Cheshire county council, who are asking for the powers.
  This is sinister. If the police said that they wanted the powers because they wanted to exercise them, I should not like that, but I should understand it. But when they say that they want them even though they will not exercise them, I ask myself whether it is because they want to proceed against A and not against B or vice versa. If so, by what criteria will they choose?
  Friends of The Earth might have a spontaneous demonstration, as my hon. Friend the Member for Barking described. The local police chief might think that they were a bunch of nutters who should be dissuaded. There might be a spontaneous demonstration about a redundancy. The police chief there might be a fan of Friends of The Earth and an environmentalist himself but against trade unions—or, at least, against all unions but his own. He might decide not to proceed against them. This is too great a power to be put into arbitrary use by people who are not directly accountable for its use and upon whom there will be no check when it comes to the criteria they use in deciding whether to exercise it.
  The clause is riddled with difficulties. It seeks to make but a little change. It cannot be said to be a huge change now that the county council has climbed down from the stipulation about seven days. If the county council thought that it

  1617
  needed seven days, it ought not to be climbing down. It should have the courage of its convictions. It ought now to be asking whether there is any point in arousing all this controversy and prejudicing the possibility of getting the other beneficial provisions of the Bill enacted as quickly as possible for the sake of this small item. That is why I strongly support the motion to instruct the Committee to leave out clause 29 and, for the reasons I gave earlier, the motions to commit clauses 6, 7 and 8 to a Committee of the whole House.
  9.12 p.m.
  Mr. Allan Roberts: I want to speak to clause 29 in the hope that the sponsors of the Bill will agree to withdraw the clause. I am amazed by what I have heard from Tory Members. It seems that they want organised demonstrations which are not spontaneous. They want spontaneous demonstrations which are not organised. They do not want spontaneous demonstrations which are organised, which would seem to be far more sensible in terms of maintaining law and order than spontaneous demonstrations which are not organised. Next they will be saying that they want spontaneous demonstrations with seven days' notice. The sponsors of the Bill have not thought out what clause 29 means.
  Conservative Members believe that the clause allows for spontaneous demonstration when it obviously does not. I suggest that they read the clause carefully and recognise that it will take away the freedom of people to demonstrate spontaneously, in a way that they have been able to do in this country for many years. This is a basic freedom which should not be lightly thrown away—in Cheshire or anywhere else.
  It is also being said that the police will not use the clause. My hon. Friend the Member for Bethnal Green and Bow (Mr. Mikardo) has said that this is sinister and I agree. One of the reasons why the police have not used such a power in the past in places where such a provision has been in force is that it is unenforceable.
  It is not possible to enact a law to prevent people from demonstrating spontaneously in certain circumstances. One of the tests of good legislation is whether
  1618
  it is enforceable. This legislation is not enforceable unless there are to be major conflicts between the police and those who seek to exercise a democratic right to demonstrate peacefully because they feel angry or concerned about something and wish to demonstrate that at short notice. The clause will not work, and that is why in the past the police have on many occasions been reluctant to use such a power.
  I am sorry that the hon. Member for Bury St. Edmunds (Mr. Griffiths) is not present now, because I have a question to put. I am concerned about the question to whom we would be giving the power if the clause were enacted. It would not be so bad if, when we passed legislation giving power to police forces, we gave the power to the police authority rather than to the chief constable, to the people democratically elected in the area rather than to the executive, to those who have to carry out what is required.
  I am concerned that we are constantly being asked to give more power to chief constables to take decisions which ought to be taken by the people democratically elected either to this place or to local authorities. It is difficult at present, with the way that our police forces are organised and power is vested in chief constables instead of in police authorities, to get any democratic discussion about decisions taken, for example, to ban marches or to prosecute people who break provisions such as clause 29. It is difficult to have proper discussion in democratically elected bodies such as police authorities.
  The hon. Member for Bury St. Edmunds said that the police were the best guardians of freedom that we had. I wonder whether he really believes that. It is certainly not true in a lot of countries that the police are the best guardians of freedom. One of the reasons why in many other countries the police are the ones who interfere with people's freedoms—the term "Police State" is familiar to us all—is that more and more power is given to the police and is taken away from democratic institutions such as local authorities, police authorities and Parliament.
  If we continue to take away basic freedoms, allowing decisions about whether people should march, about whether a

  1619
  march is spontaneous or about whether people taking part in a spontaneous march should be prosecuted, and if we vest those decisions in chief constables and the police forces, we shall find that the police are not the best guardians of freedom. Quite the opposite will be true. I am sure that the police themselves do not want it, but they will come to be seen as the people who restrict freedom, who are seen to be controlling citizens' democratic rights in a way which must be totally unacceptable.
  It should be remembered that there is a strange aspect to this matter in another respect. In metropolitan counties and non-metropolitan counties, the police authority is the county. It is a county council function exercised through the committee of the police authority. What little power there is to debate and control police matters vests in that authority. But under the Public Order Act the local authority that is consulted about whether a march should be banned is the district authority, and the existence of this situation creates great problems.
  I was a councillor in Manchester in 1977 when the local authority, which has a right to be consulted by the police about whether marches should be banned, was totally ignored by the chief constable of Greater Manchester, who then, in his words, connived with the National Front, which planned the route of a National Front march through the most sensitive areas of Manchester, where the immigrant communities live. He did that without consulting the district authority, allowing the National Front to trespass on land owned by the then city of Manchester, again without consulting the local authority.
  The hon. Member for Bury St. Edmunds said that one of the problems about these marches was that the police were taken away from other duties which were of importance. Literally thousands of policemen were guarding that march, protecting the National Front, a march which was planned by the police. It cost the ratepayers of the city of Manchester and Greater Manchester thousands and thousands of pounds, but they were not even consulted. Such a thing could do nothing but harm to the image of the police, and in that situation they are seen to be not the best guardians of freedom but quite the opposite.
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  I believe that one reason why we have clause 29 in this form in the Bill is the same as the reason why it was in the Merseyside Bill and is in the Greater Manchester Bill. It is there—this is sinister, too—because chief constables are getting together. They are deciding what local authorities should put in their legislation. They are beginning to influence legislation in a way that is totally unacceptable. That is not their job, and they should be kept well away from legislation.
  I represent Bootle, which had its own police force before local government reorganisation. The chief constable was a local man who grew up in Bootle and married the local sergeant's daughter. Everybody knew him. Before the reorganisation there were many chief constables. Now the whole of urban Britain is controlled by six police forces and the Metropolitan police in London. There are six men with a great deal of power outside London. They are policemen who meet together to decide policy. Seemingly they are accountable to no one. They are not accountable to Parliament, the Home Secretary, or even their police authority on such matters. Some of the chief constables, including the chief constable of Manchester, Mr. Anderton, have made political speeches, become cult figures of the Right, and attacked our democratic freedoms and rights.
  Clause 29 is part of that campaign. We must vote against it. If Conservative Members really believe in the concept of freedom—and they use that word so often that it is losing its value and changing its meaning—they will vote with my hon. Friends and me against the clause. That will ensure that we take a step towards more freedom, towards maintaining and protecting freedom, and towards stopping chief constables from deciding what the laws should be. The House should decide those laws.
  People should have the right to demonstrate when they feel the need to go out into the streets and do so. I cite three examples of spontaneous demonstrations. I was personally involved in two of them. My first political memory is of the Suez crisis, when I took part in a spontaneous demonstration. If the clause had been in force then, that would have been illegal.
  Again in my youth I took part in a demonstration about the Cuban crisis.

  1621
  There were demonstrations then throughout the country that would have been illegal if the clause had been in force.
  There was a recent spontaneous demonstration following the execution of Bhutto. If Conservative hon. Members who are fighting for the restoration of the death penalty want to ban the right to demonstrate spontaneously when a decision is taken elsewhere that someone who is under sentence of death by hanging is not to be reprieved, that is an extremely dangerous course to advocate.
  Clause 29 is far more significant than at first appears. It is important that it be removed from the Bill or defeated. If the clause is not removed or defeated, it will become a major step towards giving the police far more power than is right, just and sensible if we wish to maintain good relations between the police and the public and the democratic institutions of which we are proud.
  9.23 p.m.
  The Minister of State, Home Office (Mr. Leon Brittan): I should like to give the Government's views on some of the matters raised during the debate. I shall comment on the clauses in part II of the Bill that relate to the authority's powers to give assistance to industry.
  My hon. Friend the Under-Secretary of State for the Environment made clear on Second Reading of the Greater London Council (General Powers) Bill on 12 June that the Government are firmly opposed to any further proliferation of Private Act powers for local authorities to give financial assistance to industry, especially at a time when we are closely examining the Government's powers in that area.
  We shall oppose all provisions in local authority Bills now before Parliament that seek to increase existing local powers or to extend their life beyond 1984. For that reason we are opposed to the broadening of the term "industrial", which clause 2 seeks to achieve. We are also opposed to clauses 6, 7 and 9, on the ground that they seek an unacceptable amplification of existing powers. I hope that in its consideration of the Bill the Committee will be persuaded by the arguments put forward opposing those provisions.
  Mr. John Evans: The Minister made an important statement. Does he agree
  1622
  that it would be better for these clauses to be considered on the Floor of the House—in view of the wide ramifications for local authorities which wish to assist industry—rather than in a narrowly defined Committee?
  Mr. Brittan: I do not accept that argument.
  I should like to proceed to the matters that have occupied the House for the bulk of the time in which consideration has been given to this matter. I refer to the clause requiring those organising or conducting street processions in the county to give advance notice to the police and the district council. The clause is similar to those in a number of other local Bills. Similar provisions in the West Midlands and Merseyside Bills were debated at some length by the previous Parliament.
  At present there is no requirement in the Public Order Act 1936 or other national legislation for the organisers of processions to give advance notice of their intention. When, following the Red Lion Square disorders in June 1974, the then Commissioner of Police of the Metropolis proposed such a requirement, Lord Scarman expressed in his inquiry report the view that the need for such a provision had not been established. He had especially in mind the problems that would arise for demonstrations legitimately called at short notice. That matter occupied much of the debate tonight. He also felt that the actions of those who were determined not to co-operate with the police should not cause a legal requirement, which might be inconvenient, to be foisted on the ordinary citizen. It is worth noting that the lack of a notice requirement played no part in causing the disorders into which Lord Scarman inquired.
  Moreover, since 1974 there have been further disturbances where lack of notice created substantial problems for the police in the task of preventing disorder and minimising the inconvenience that the ordinary public inevitably suffer as a result of marches.
  Serious problems arose at Ladywood in August 1977 on the occasion of an impromptu march connected with a violent demonstration against a National Front by-election meeting. At Digbeth in February 1978 demonstrators against a

  1623
  National Front meeting decided at the last minute to hold a march along a route that completely nullified a traffic diversion that had previously been arranged and advertised by the police. Hon. Members are well aware of the burdens imposed on the police and the community in the recent general election campaign by often hastily arranged and ill-organised demonstrations.
  In the absence of a notice provision, information reaching the police about proposed marches and processions may very well be patchy and arrive too late for appropriate action to be taken to deal with the situation and to make it possible for such marches and processions to take place peacefully in the way that we all want.
  It is therefore right that, in relation to the national law, we should consider matters afresh. My right hon. Friend the Home Secretary indicated that he intended to consider whether any changes in the law would be useful or desirable.
  We heard a great deal tonight about the right to demonstrate, but it is not a right to demonstrate whenever and wherever we want. The exercise of the right of protest must be balanced against the rights of ordinary citizens to go about their business without undue obstruction and inconvenience.
  Those hon. Members who referred to the views of Lord Scarman should note he made it clear that he did not consider that a requirement for advance notice represented an unacceptable encroachment on liberty. We heard a great deal about liberty and the right of peaceful assembly from the hon. Member for Barking (Miss Richardson).
  Reference was made to international obligations and the need to protect the right of freedom of expression and freedom of speech. I yield to no one in my support and passionate belief in the fundamental rights of freedom of speech and freedom of association. With the best will in the world, I do not see how a limited requirement that notice should be given—not permission sought, but notice given—of such matters as the route and the nature of the procession in any way conflicts with freedom of speech or freedom of association.
  The language used by the hon. Member for Bootle (Mr. Roberts), about tak-
  1624
  ing away freedom, was simply inappropriate to a provision of this kind which requires no more than that notice of the details of the procession should be given. The hon. Gentleman said that it was unenforceable. It would, indeed, be unenforceable if what was required was something of the nature of permission. All that is said here is that notice must be given, and that if notice is not given that is an offence. I see nothing unenforceable about that. To talk about taking away freedom because there is a Bill which seeks to extend from 36 hours to three days a requirement that people should give notice to the police is, perhaps, to put it at its happiest, a reflection of how free a society we are if a matter such as that is regarded as deprivation of freedom.
  Mr. John Evans: Rubbish!
  Mr. Allan Roberts: As the hon. and learned Gentleman seems to be suggesting that the requirement to give notice does not take away freedom, will he tell us how it is possible to give notice of a spontaneous demonstration?
  Mr. Brittan: I am grateful to the hon. Gentleman for raising that point. I was coming to the question of spontaneous demonstrations, which has occupied much of the debate. It has been made quite clear, in the course of the debate, that in the past, when this provision has lain on the statute book, in Cheshire there has been no trouble with spontaneous demonstrations and no prosecutions have been brought in relation to them. The fact that the notice provision is increased from 36 hours to three days does not affect the position.
  Mrs. Dunwoody rose—
  Mr. Brittan: I must elaborate this point, and I shall give way in a moment. I just want to answer the points that have been made about spontaneous demonstrations. If a demonstration is truly spontaneous, it makes no difference whether the period of notice is 36 hours or three days. In either event the spontaneous demonstration must be in breach of the law, yet there have been no prosecutions.
  If anything, what is proposed in the Bill provides further protection against unreasonable prosecution in the case of

  1625
  a spontaneous demonstration that has not actually occurred, and in relation to which there has been no evidence, because the promoters have indicated that they are suggesting that the Director of Public Prosecutions should give his consent before any prosecution is brought under this head. To suggest that underneath the provision that notice should be sought there lurks some sort of conspiracy among chief officers of the police to take away rights, and some lurking desire to show preference either for Friends of the Earth against trade unions or vice versa, is bordering on fantasy. I do not believe that those hazards apply.
  I have spoken about the scope of the national law, but if we are to make changes nationally in the Public Order Act, there should first be careful consultation and consideration. In the meantime, it is reasonable for local authorities to seek to continue in force local powers that they consider necessary and that in each case Parliament should judge the proposals on their merits.
  Mrs. Dunwoody rose—
  Mr. Brittan: I shall give way in a moment, after I have finished my next sentence. I agree with what my hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths) said, that it will be preferable when these matters are considered on a national basis, as they will be in due course. However, I think that in the meantime, for local authorities in the new counties to ask to enact legislation in substantially the same form as before, with slight variations in the powers that previously existed, is not in any sense unreasonable.
  Mrs. Dunwoody: The confident assumption that the hon. and learned Gentleman seems to be making, that because the powers have not been used they would never be misused, is the basis of all bad legislation. Is the hon. and learned Gentleman aware that the hon. Member for Northwich (Mr. Goodlad) was not able to quote the number of cases where there had been this sort of riotous assembly, needing this kind of notification, or to demonstrate that spontaneous demonstrations had got out of hand? Why does the hon. and learned Member think that he has any right to say that this can be done by the back door
  1626
  when the Government are not prepared to bring forward changes in the Public Order Act at present?
  Mr. Brittan: I cannot see how it can be doing something by the back door to seek, in effect, to re-enact, for a slightly larger area than existed in the past under comparable legislation, a power to do substantially the same thing, with a slight variation in the period of notice.
  As for there being no abuse of the power, all I can say is that those present have memories, recollections and evidence from researchers which has led them to give examples of spontaneous demonstrations on a substantial scale, yet no one has given an example of a prosecution in respect of a spontaneous demonstration or procession which is regarded as being unfair or inappropriate.
  Mr. Eldon Griffiths: I am grateful for what my hon. and learned Friend said about the Home Secretary giving consideration to the need for national legislation on this matter. He has very fairly said that he will need to consult and to consider the matter carefully. Perhaps I may make a suggestion. When other county council Bills come forward, as indeed they will, I suggest that my hon. and learned Friend should invite the promoters to come to the Home Office, if they wish, and to consider with his officials ways in which they can bring forward clauses of this kind within the Bill in the spirit of the national consideration that the Home Secretary has undertaken to give and to report in due course.
  Mr. Brittan: I am grateful for that suggestion. The difficulty is that if one is seeking consultation with promoters of local Bills, it presupposes that one has reached a view of what the national provisions should be, and—
  Mr. John Evans rose—
  Mr. Brittan: I shall not give way until I have finished my sentence. As the review on which my right hon. Friend is embarking has not been concluded, it is difficult to see the basis for doing that up to now. However, it seems to me that where local authorities are seeking to continue powers on the lines of those that already exist, it is a reasonable thing for them to do.
  Mr. Tom McNally: Terms such as "consult", "consider" and "reach conclusions" are being used. However, will the Minister acknowledge that, without using emotive words such as "conspiracy", a pattern is being established right across the country which is pre-empting just the kind of careful consideration to which he is now giving lip service?
  Mr. Brittan: I do not believe that it is pre-empting it, because I am certain that when the review upon which my right hon. Friend is embarking is concluded the conclusions will be put before the House and the House will have ample opportunity to decide whether it wishes to legislate at all and, if so, on what lines. Therefore, for the moment, and concerning this legislation, I think that it is right that the clause should be subject to detailed scrutiny in Committee. The Committee will wish to consider the scope of the provision, the length of notice proposed and the local need. That, indeed, is precisely the purpose of the Committee stage. But it would be wrong, and a disservice to the people of Cheshire and their elected representatives, if the motion in the names of the hon. Member for Stockport, North (Mr. Bennett) and others prevented proper democratic consideration of just these matters.
  Mr. Merlyn Rees: I do not wish to make a speech in this debate. Much of the ground has been covered. However, it is most important that we should know more about what the Minister of State has just said. I welcome the fact that the Government are looking at the Public Order Act. There is no national legislation on the subject that we are discussing. Because of local government reform, what is happening is that we are being presented with the Private Bills, and there is a hotchpotch of legislation.
  Other aspects of public order need to be considered in the right hon. Gentleman's consultations. The chief constable of Leicester, in whom I have great confidence, quite properly took a view about a march during the election campaign and brought in reinforcements from Norfolk and the Metropolitan police force. As a result of a change made in the law in 1936, a judgment made locally can affect the country as a whole in terms of reinforcement, and that aspect must be considered. The inspectorate and the
  1628
  Home Secretary are involved. I admit that I had not considered that aspect until the election, just before I ceased holding office.
  Mr. Brittan: I reassure the right hon. Gentleman that those considerations will be wholly appropriate for the review. Circumstances have changed in a variety of directions since 1936 and that is a vivid example. The review is needed precisely for that reason.
  Mr. Rooker: I have a sheaf of correspondence dating from 1976 between the agents and promoters and the Home Office about the common clauses in the Bill. They did not arrive spontaneously, but followed the permission granted after a parliamentary question to my right hon. Friend the previous Home Secretary in March of this year. The Home Office is not ignorant of these matters. If the Minister cares to check, he will find more information than that provided to me.
  It is correct that some of us on this side of the House have good memories. Is the Tory Party tonight operating in the same way as it did over the past few years in Opposition? It set the precedent of a major political party putting a Whip on private business. Is there a Whip tonight on Tory Members?
  Mr. Brittan: I was not aware that I suggested that the Home Office was in ignorance. Nothing I have said could be interpreted as seeking to make that case, and I cannot see why the hon. Gentleman raised that point.
  My right hon. and hon. Friends will vote according to their views. The Government's view is that it would be wrong and a disservice to the people of Cheshire and their elected representatives if the motion in the name of the hon. Member for Stockport, North (Mr. Bennett) and others prevented proper and democratic consideration of these matters.
  9.42 p.m.
  Mr. Andrew F. Bennett: It is sad that we are debating the procession clause for the third time and have not achieved a satisfactory solution. The silk weavers of Macclesfield 163 years ago were able to form a procession without giving notice. They proceeded towards Manchester and only ran into difficulties when they arrived at Peterloo. They had the right to process

  1629
  without giving notice, but subsequently that right has been taken away, and people in this country should have the fundamental right to demonstrate.
  I am in sympathy with the argument that the police should be given as much notice as possible, and three days is not enough. Most hon. Members would not be pleased to be suddenly told that their activities planned for Sunday or Monday had to be cancelled. They would prefer a longer period of notice than three days. Those organising a demonstration, particularly if it involves large numbers, should give the police as much notice as possible.
  We are in danger of getting the worst of both worlds with this clause. We are whittling down to a minimum the notice of three days which really does not help the police at all. At the same time we cause difficulties and embarrassment to those who want to organise a demonstration at very short notice about some immediate event. I believe that we should be looking at the possibility of giving the maximum possible notice of any demonstration or procession.
  That is the sort of notice that the organisers give to those whom they want to turn up. If organisers aim to get 10,000 people, and send out posters and leaflets to that effect, it is reasonable that they should consult and discuss with the police when they begin to draw up their plans. But at the same time if, because of the immediate urgency of the event, only very short notice can be given, telephoning round to people and asking them in turn to telephone, or if one goes round knocking on doors, again one should be entitled to give the police that sort of short notice. That is the kind of compromise that would be most satisfactory. We should try to persuade people organising demonstrations to give as much notice as possible. As many hon. Members have said, the vast majority of people who organise demonstrations give a long period of notice for their own convenience and the convenience of the police. There is no problem with the majority.
  The problem arises when one lays down that a particular length of notice should be given. If it is very short notice—like the three days proposed—it would still
  1630
  cause the police difficulty in organisation. At the same time it would cause problems for those who are organising the demonstration. It also makes impossible the counter-procession or counter-demonstration.
  In all the discussions that I have had with the police they have made it absolutely clear that if one group of people plan to have a procession that is bound to cause controversy, they would much prefer that someone organises a counter-procession which takes place away from the first one, than that people simply line the route of the original procession and cause disruption and difficulties.
  As long as there is any time limit, it is possible for those organising the first demonstration to give the absolute minimum time, and having done that they make it absolutely impossible for anyone to organise a legal counter-procession or demonstration. The inevitable result is that this forces any group of people who want to express disgust or horror for the original demonstration not to do it in an organised way but merely to line the route to jeer and shout or, unfortunately, in many cases take more serious action. The very inclusion of a time limit makes the maintenance of public order that much more difficult.
  I turn to the question of the spontaneous demonstration. It is absolutely clear that we cannot define a spontaneous demonstration. Although the promoters have claimed that they do not want to include spontaneous demonstrations, it is quite clear that in fact they are included. As soon as one person suggests that people should line up in threes, or go to one side of the road, that person is starting to organise that group. Because he has not given notice he is, under this Bill, committing an offence. It has also been suggested that those who commit that kind of offence are unlikely to be prosecuted. That is a very unsatisfactory way for the law to operate. It has been said repeatedly that there has been no problem in Cheshire with groups of people who have not given the old minimum amount of notice and who were not prosecuted. But surely we do not want the police to decide which laws they administer and which laws they do not.
  First of all, I do not think that it is the job of the police to decide which laws of the land they employ and which they

  1631
  do not. But immediately they begin to be involved in deciding that they will administer the law in one case rather than in another, they start to appear, whether it is true or not, to have political biases. If they do not intervene because somebody is organising a demonstration in favour of, say, blood sports but intervene when somebody is organising a procession against blood sports, they appear to be taking a political stance.
  Mr. Rooker: May I draw my hon. Friend's attention to a law which was on the statute book for many years but not enforced, and which when it was eventually enforced cause a general strike? I refer to a case which occurred in Australia. When a company refused to discuss a wage claim, the workers sent for the trade union officials. Because it was found that the discussion involved more than three people, that obscure law—to the effect that one could not address a meeting of more than three people unless one had police permission—was invoked. As a result, three union leaders were arrested, and there was a general strike in Australia. That was a good example of why one should not have laws which can be spontaneously enforced to allow matters to get out of control. My hon. Friend might care to develop that argument.
  Mr. Bennett: I am grateful to my hon. Friend for illustrating that problem in deciding whether to exercise the law.
  Mrs. Elaine Kellett-Bowman: Is the hon. Gentleman aware that there are thousands of laws on the statute book at present which have never been tested in the courts? In other words, thousands of laws, which exist with no ill intent on anybody's part, have never been tested in the courts.
  Mr. Bennett: If that is the case, I do not see why we should now try to put forward yet another law. I am not sure whether the hon. Lady is suggesting that those laws should be abolished, or whether one should add to the statute book. I realise that there are lawyers who have a vested interest in extending the number of statutes so that the ordinary person cannot understand them.
  I believe it is important that the individual who is thinking of organising a demonstration should know where he or
  1632
  she stands. The matter should not be dealt with on the basis that the police or the Director of Public Prosecutions should decide whether to prosecute. Most people want to be law abiding and before they take action they want to know how the law stands. They want to take such action in order to keep the law rather than break it, and they hope that they will not be prosecuted for it.
  The promoters are suggesting that we should include this provision to make it illegal to carry out the demonstration or conduct the procession, but provided that one has not caused a nuisance there will be no prosecution. That surely is a bad situation in respect of the law, because the individual should know where he stands. It is a different matter for people who are members of big organisations. If one is a member of a substantial trade union and is used to political activity, it is easy to take that kind of risk. But most of the people who organise such processions have never organised anything else in their lives.
  Mr. McNally: Will my hon. Friend guide me through my perplexity? The Minister called for national consultation, and my right hon. Friend the former Home Secretary called for regional and local examination of the law in such cases. We have already established that Cheshire is not likely to be the start of the next revolution. Has my hon. Friend in his examination of the problem seen a national pattern in some of the legislation that is now coming before the House? If he has noted a national pattern, will he say whether it does not directly contradict the kind of assurances which have been given by Ministers to the House?
  Mr. Bennett: I was concerned that there appeared to be some conspiracy among groups of people who got together and suggested that the period should be seven days. They put that view forward not because they believed that it should be seven days but because they believed that if they asked for such a period a bargaining process would take place and they would end up with a period of three days.
  That was an unfortunate element. The advantage of having national laws is that people move about the country. It would

  1633
  be better if someone moving from Stock-port to Wilmslow knew that if he wanted to organise a demonstration or procession the same rules would apply in both localities. At the moment, they do not. It is possible that those who want to cause a nuisance will pick the areas of local authorities which do not have restrictions on demonstrations and processions.
  Mr. John Evans: My hon. Friend has raised some important points, particularly the point that people in this country are basically law-abiding citizens who want to know and understand the law in order that they can obey it. Is my hon. Friend aware of the parallel between what we have discussed tonight and the law on picketing? We have been told that concessions will be given and that the Director of Public Prosecutions will be brought in and look upon particular demonstrations sympathetically. In other words, it depends upon the attitude of the chief constable or chief superintendent in any district. The Government constantly talk about the law on picketing, but my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) and I attempted to clarify the law on picketing in the Employment Protection Bill of the last Parliament—
  Mr. Speaker: Order. The hon. Member is not making an intervention—it is developing into a speech.
  Mr. Bennett: I appreciate that the law should be clear in order that the individual should know it before he embarks upon organising any demonstration. The responsibility for a demonstration or procession is laid on the individual in this Bill. If the promoters are looking for
  ways to meet our objectives they should consider amending the provision to cover persons or a group. The past has shown that it is best that a person with experience should organise a demonstration.
  There are many instances where trades councils in a particular area have been responsible for organising a demonstration or procession. That is a collective responsibility. Under the Act an individual will have to be nominated to be responsible for the behaviour of the vast majority on the procession. It is difficult for an individual to accept responsibility for the actions of others. A small concession would be to allow a corporate body or group to take on the duty if it is necessary.
  There is a strong argument for exempting a small demonstration or procession from giving notice. Some of the promoters have been prepared to look at the question of exempting a demonstration or procession involving less than 200 people because the number of police required is very small. Not only that, but the amount of traffic disruption is small. Two hundred people walking down the street take up about the same space as three double-decker buses.
  If someone wants to organise a small demonstration or procession, it is silly that he should have to give notice in this formal way. People in Cheshire who have been giving such notice have been told by the district office—
  Mr. David Hunt rose in his place and claimed to move, That the Question be now put.
  Question put, That the Question be now put:—
  The House divided: Ayes 164, Noes 41.

  Division No. 17]

  AYES

  [10.00 p.m.

  Adley, Robert

  Bowden, Andrew

  Chalker, Mrs. Lynda

  Aitken, Jonathan

  Boyson, Dr. Rhodes

  Churchill, W. S.

  Alexander, Richard

  Braine, Sir Bernard

  Clark, William (Croydon South)

  Ancram, Michael

  Bright, Graham

  Clarke, Kenneth (Rushcliffe)

  Arnold, Tom

  Brittan, Leon

  Clegg, Walter

  Aspinwall, Jack

  Brocklebank-Fowler, Christopher

  Colvin, Michael

  Atkins, Robert (Preston North)

  Brooke, Hon. Peter

  Cope, John

  Baker, Kenneth (St. Marylebone)

  Brotherton, Michael

  Costain, A. P.

  Baker, Nicholas (North Dorset)

  Brown, Michael (Brigg & Sc'thorpe)

  Crouch, David

  Bendall, Vivian

  Browne, John (Winchester)

  Dean, Paul (North Somerset)

  Benyon, Thomas (Abingdon)

  Bruce-Gardyne, John

  Dickens, Geoffrey

  Berry, Hon. Anthony

  Bryan, Sir Paul

  Dorrell, Stephen

  Best, Keith

  Budgen, Nick

  Dunn, Robert (Dartford)

  Bevan, David Gilroy

  Bulrner, Esmond

  Durant, Tony

  Blackburn, John

  Butler, Hon. Adam

  Dykes, Hugh

  Boscawen, Hon. Robert

  Cadbury, Jocelyn

  Eden, Rt. Hon. Sir John

  Bottomley, peter (Woolwich West)

  Carlisle, Rt. Hon. Mark (Runcorn)

  Edwards, Rt. Hon. N. (Pembroke)

  Emery, Peter

  Mackay, John (Argyll)

  Shepherd, Richard (Aldridge-Br'hills)

  Eyre, Reginald

  Madel, David

  Shersby, Michael

  Fenner, Mrs. Peggy

  Marlow, Antony

  Silvester, Fred

  Finsberg, Geoffrey

  Marten, Neil (Banbury)

  Smith, Dudley (War, and Leam'ton)

  Fisher, Sir Nigel

  Mates, Michael

  Spicer, Jim (West Dorset)

  Fletcher-Cooke, Charles

  Mather, Carol

  Spicer, Michael (S Worcestershire)

  Fookes, Miss Janet

  Mawby, Ray

  Sproat, Iain

  Fowler, Rt. Hon. Norman

  Maxwell-Hyslop, Robin

  Stanbrook, Ivor

  Fox, Marcus

  Mayhew, Patrick

  Steen, Anthony

  Galbraith, Hon. T. G. D.

  Meyer, Sir Anthony

  Stevens, Martin

  Garel-Jones, Tristan

  Miller, Hal (Bromsgrove & Redditch)

  Stewart, John (East Renfrewshire)

  Glyn, Dr. Alan

  Miscampbell, Norman

  Stradling Thomas, J.

  Goodlad, Alastair

  Mitchell, David (Basingstoke)

  Tebbit, Norman

  Gow, Ian

  Monro, Hector

  Temple-Morris, Peter

  Gray, Hamish

  Montgomery, Fergus

  Thomas, Rt. Hon. Peter (Hendon S.)

  Greenway, Harry

  Moore, John

  Thompson, Donald

  Griffiths, Eldon (Bury St Edmunds)

  Morrison, Hon. Charles (Devizes)

  Thorne, Neil (Ilford South)

  Gryils, Michael

  Morrison, Hon. Peter (City of Chester)

  Thornton, George

  Hannam, John

  Murphy, Christopher

  Townsend, Cyril D. (Bexleyheath)

  Haselhurst, Alan

  Needham, Richard

  van Straubenzee, W. R.

  Hawksley, Warren

  Neubert, Michael

  Vaughan, Dr. Gerard

  Henderson, Barry

  Newton, Tony

  Viggers, Peter

  Hicks, Robert

  Normanton, Tom

  Waddington, David

  Hill, James

  Onslow, Cranley

  Wakeham, John

  Hunt, David (Wirral)

  Osborn, John

  Waldegrave, Hon. William

  Hunt, John (Ravensbourne)

  Page, Rt. Hon. R. Graham (Crosby)

  Wall, Patrick

  Jenkin, Rt. Hon. Patrick

  Patten, Christopher (Bath)

  Waller, Gary

  Jopling, Rt. Hon. Michael

  Patten, John (Oxford)

  Ward, John

  Kellett-Bowman, Mrs. Elaine

  Peyton, Rt. Hon. John

  Watson, John

  King, Rt. Hon. Tom

  Price, David (Eastleigh)

  Wells, P. Bowen (Hert'rd & Stev'nage)

  Knox, David

  Rathbone, Tim

  Wheeler, John

  Lamont, Norman

  Rees-Davies, W. R.

  Whitney, Raymond

  Lawrence, Ivan

  Rhodes James, Robert

  Wilkinson, John

  Lee, John

  Rhys Williams, Sir Brandon

  Winterton, Nicholas

  Le Marchant, Spencer

  Ridley, Hon. Nicholas

  Young, Sir George (Acton)

  Lester, Jim (Beeston)

  Ridsdale, Julian

  Lloyd, Peter (Fareham)

  Rossi, Hugh

  TELLERS FOR THE AYES:

  Macfarlane, Neil

  Sainsbury, Hon. Timothy

  Sir. Nicholas Bonsor and

  MacGregor, John

  Shelton, William (Streatham)

  Mr. Barry Porter.

  NOES

  Alton, David

  Hamilton, W. W. (Central Fife)

  Prescott, John

  Anderson, Donald

  Holland, Stuart (L'beth, Vauxhall)

  Race, Reg

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

  Kerr, Russell

  Rees, Rt. Hon. Merlyn (Leeds South)

  Bennett, Andrew (Stockport N.)

  Kinnock, Neil

  Richardson, Miss. Jo

  Booth, Rt. Hon. Albert

  Lomond, James

  Rooker, J. W.

  Brown, Hugh D. (Provan)

  Leadbitter, Ted

  Ross, Stephen (Isle of Wight)

  Brown, Ronald W. (Hackney S.)

  Leighton, Ronald

  Skinner, Dennis

  Callaghan, Jim (Middleton & P.)

  McCartney, Hugh

  Snape, Peter

  Dormand, J. D.

  McDonald, Dr. Oonagh

  Soley, Clive

  Dunwoody, Mrs. Gwyneth

  Marshall, Dr. Edmund (Goole)

  Spriggs, Lesile

  Eastham, Ken

  Maynard, Miss. Joan

  Young, David (Bolton East)

  Evans, John (Newton)

  Mikardo, Ian

  Fitt, Gerard

  Orme, Rt. Hon. Stanley

  TELLERS FOR THE NOES:

  George, Bruce

  Pendry, Tom

  Mr. Allan Roberts and

  Grant, George (Morpeth)

  Powell, Raymond (Ogmore)

  Mr. Tom McNally.

  Question accordingly agreed to.
  Question, That the Bill be now read a Second time, put accordingly and agreed to.
  Bill read a Second time and committed.

  BUSINESS OF THE HOUSE
  Ordered,
  That, at this day's sitting, the second Motion in the name of Mr. Andrew Bennett relating
  1636
  to the Cheshire County Council Bill [Lords] may be proceeded with, though opposed, until a quarter of an hour before Eleven o'clock.—[Mr. Jopling.]

  CHESHIRE COUNTY COUNCIL BILL [Lords] (By Order)
  Mr. Speaker: Does the hon. Member for Stockport, North (Mr. Bennett) wish to move the Instruction?
  Mr. Andrew F. Bennett: No, Sir.

  GREATER LONDON COUNCIL (GENERAL POWERS) [MONEY]
  Order read for resuming adjourned debate on Question [14 June],
  That, for the purposes of any Act of the present Session to confer further powers upon the Greater London Council and other authorities, it is expedient to authorise the payment out of money provided by Parliament of any sums required for the remuneration of members of the staff commission to be established by the Secretary of State in pursuance of that Act or to defray any expenses of that commission.—[Lord James Douglas-Hamilton.]
  10.14 p.m.
  The Under-Secretary of State for the Environment (Mr. Geoffrey Finsberg): The House gave the Bill—[Interruption.]
  Mr. Speaker: Order. Hon. Members seem to be unaware that the Minister is addressing the House.
  Mr. Finsberg: The House gave this Private Bill its Second Reading on 12 June. Clause 8 of the Bill seeks power to establish a staff commission. Its role would be to look after the interests of the GLC staff involved when the property with which they deal is transferred from the GLC to the London boroughs and to some district councils outside London. There is no doubt that these staff should be transferred, and it is generally agreed that a statutory staff commission appointed by my right hon. Friend the Secretary of State is essential if the transfers are to go smoothly.
  There are many precedents for staff commissions of this sort. For example, they were appointed to deal with the transfers resulting from the local government reorganisations of 1965 and 1974, as well as those associated with the current transfer of housing from new town development corporations to new town district councils. In these previous cases, the Government have accepted that they should foot the bill for the establishment and operation of the staff commissions. We see no reason to depart from this practice now.
  The power enabling the Government to meet this cost is sought in the money resolution which we are now debating. I ask the House to approve this resolu-
  1638
  tion. With leave of the House, Mr. Speaker, I shall seek to catch your eye again at the end of this brief debate if there are any points to answer.
  10.16 p.m.
  Mr. Ronald W. Brown: When we debated this Bill, I said that I was dissatisfied with the proposals and put a number of questions. Although the Minister did his best to satisfy me, I was not satisfied. I felt that the only way that I could enlarge on the matter was by blocking the money resolution so as to have this short debate in an attempt to get more information. I am grateful to the hon. Gentleman for offering to clarify some points.
  In the previous debate, I drew attention to the fact that the New Towns Commission was still in being and was coming to the end of its work. Since it had had a wide experience of the transfer of houses, land and other facilities in the new towns, it seemed sensible that it should be asked to carry on and use its invaluable experience. I should like to know why the Commission is not being called on to continue.
  I am totally opposed to these transfers anyway. The tenants of the GLC and of the boroughs, certainly in Hackney, will not be able to be rehoused in any other part of London. They will have no possibility of a transfer. We are already experiencing severe problems in getting families transferred. Houses are being kept empty and their state of repair is deplorable. We can already see examples of what will happen when the Bill is put into effect.
  The House must be satisfied that this public expenditure is right and proper. When the Government are cutting public expenditure, nothing is safe. In my own area, for example, it is proposed to close two hospitals to save just £2 million, notwithstanding all the concern and the problems facing my constituents.
  The Conservative chairman of the housing committee of the GLC is apparently authorised to make unlimited offers to transferee authorities to take these properties over. We are told that it runs into tens of millions of pounds. How ironic that we close two hospitals in my constituency to save £2 million while at the same time the Government are able

  1639
  to authorise the expenditure of tens of millions of pounds on this exercise of transferring homes which will not mean one extra home for any family. The Government are prepared to trade the health and welfare and the lives of my constituents for their measly £2 million, yet they are able and willing to authorise this high expenditure on transfers. In Hackney the transfer will be a continuing burden on the ratepayers.
  There are in Hackney 26,000 GLC properties. I intervened in the speech of the hon. Member for Ravensboume (Mr. Hunt) when we debated the general powers Bill to ask how many GLC estates he had. He said that he had 760 units of accommodation. We have 26,000, the majority of them flats. The people living in them will never be able to move out of them. They will have no opportunity because the 760 units in Bromley will continue to be occupied by Bromley people. We know that this is a fact. It therefore seems quite improper for me to assist this transfer in any way.
  We are told by the Minister that the three commissioners to be appointed, Messrs. Vine, Bodell and Dryden, will be paid. We see on today's Order Paper that the House is merely to "authorise the payment". How much payment? Why is it that the House is not told? I cannot believe that it is possible to evaluate how much can be saved by closing two hospitals in my constituency yet impossible to evaluate how much money we are to pay to Messrs. Vine, Bodell and Dryden. We are entitled to know how much we are to pay them in expenses.
  How can it be argued that this House is carrying out its function of scrutinising expenditure if we simply accept the type of blank cheque that we see on the Order Paper? How hollow ring the words of the Chancellor who spoke of the need for financial control. Here we are being asked to authorise expenditure, yet the precise amount appears nowhere. It did not appear in the general powers Bill and it does not appear tonight in the money resolution. It is deplorable that we are being asked to approve this document when the Government clearly have no idea how much this exercise will cost.
  1640
  I am opposed to this resolution because I believe it is totally unnecessary. It fails to say how much money is involved and is, in effect, an open-ended cheque. For these reasons, I object to it most strongly.
  10.24 p.m.
  Mr. Geoffrey Finsberg: With the leave of the House, I will reply. The hon. Member for Hackney, South and Shoreditch (Mr. Brown) has asked a few questions. I believe that two were relevant and I shall gladly give him as much information about them as I can. I told the hon. Gentleman when we debated the general powers Bill that the bulk of his argument was against the principle of transfer and that that principle was not in the Bill and is not in the money resolution. He has done his calculations concerning Hackney I am glad to hear that he admits that even the London borough of Hackney will ultimately take the housing being offered by the GLC, which is a great advance.
  Mr. Ronald W. Brown: I did not admit that.
  Mr. Finsberg: The hon. Gentleman may not have admitted that, but the fact is that the London Labour Party has had to break ranks on this.
  The hon. Gentleman asked about the use of the staff commission for the new towns. He said that it was running down, he wondered whether the membership could be used, and he then named at least two people who are connected with the new towns. I do not deny that we are hoping to make use of the expertise of those gentlemen. I believe that this would be very welcome, and I doubt that NALGO, for example, would be at all unhappy at their use. Indeed, I believe that it is purely in the interests of the staff that this is being done.
  I hope that the hon. Gentleman will not feel constrained to put the staff at risk, which is what would happen if the money resolution were not passed. There are other ways of dealing with the matter, without a money resolution, but I am sure that he would not want to jeopardise the position of the staff.
  The sale or transfer of the houses is not in any way affected by the money resolution.
  Mr. Stuart Holland: Will the Minister kindly clarify one of the

  1641
  provisions in the Bill—clause 7 on page 5—relating to the parking of vehicles? It is a problem of considerable concern in my constituency that vehicles parked on GLC estates do not come under the normal control of the Metropolitan Police in relation to parking offences. Could he explain what that provision is about?
  Mr. Finsberg: Unfortunately, if I tried to do so I should be ruled out of order by the Chair, since that is not covered by any part of the money resolution. The opportunity to raise that matter was available when we had our three-hour debate on the general powers Bill. However, I am sure that if the hon. Gentleman tables a question the appropriate Minister will be delighted to give him an answer, or the GLC would be glad to give him an answer. If he cares to write to me, I shall pass the matter on to the right quarter with the greatest pleasure.
  I do not propose to discuss the allegations about hospital closures in the constituency of the hon. Member for Hackney, South and Shoreditch because I do not know the facts. All I know is that it was his late unlamented Government who tried to murder the Elizabeth Garrett Anderson hospital and it is my Government who are trying to save it. So in regard to hospitals I am satisfied with the record.
  There is one matter on which I can. I think, give the hon. Gentleman a helpful answer. With reference to cost he said that it was wrong—I think he said "scandalous"—that he did not know the amount of money involved. He has been in the House longer than I have. If he casts his eye over money resolutions he will find that none of them gives a figure. However, I am delighted to give him a figure on this occasion. The estimated cost to fall upon the Exchequer as a result of the operation of the staff commission is approximately £80,000 per year. I think that the people of London would regard that as very good value.
  I think that those are the only relevant matters on which I can help the House. With those few words, I commend the money resolution for approval.
  Question put and agreed to.
  Resolved,
  1642
  That, for the purposes of any Act of the present Session to confer further powers upon the Greater London Council and other authorities, it is expedient to authorise the payment out of money provided by Parliament of any sums required for the remuneration of members of the staff commission to be established by the Secretary of State in pursuance of that Act or to defray any expenses of that commission.

  HOUSING (PETERLEE)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Wakeham.]
  10.29 p.m.
  Mr. J. D. Dormand: I think that the Minister is aware of the general problem that I intend to raise, but for the sake of thoroughness I shall go over the whole ground in the quarter of an hour or so at my disposal.
  The northern part of my constituency consists of a number of villages and the new town of Peterlee. I mention that in preface because Peterlee is the focal point of this part of my constituency. It provides housing accommodation now for almost 30,000 people. It provides many of the jobs for this part of the area, and it certainly provides most of the social and recreational facilities. Some years ago it was almost impossible to obtain a house outside the town of Peterlee. I hope that that gives the setting for the main point that I shall later develop.
  The problem that I raise is that many houses—as many as 4,000, it has been estimated—through faulty design, poor construction and, I understand, inferior materials are now virtually unfit for habitation. I need not tell the Minister that that causes great inconvenience and discomfort to the tenants. It also means that there has been great expenditure by those living in the houses so affected. Thousands of pounds have been spent.
  I am not concerned with an inquest. Perhaps there is a story to be told and written about the circumstances that have arisen, but my main purpose is to ensure that the houses are put right before the onset of next winter.
  The amount involved—the Minister will be hearing about it shortly from the Easington district council if he has not heard already—is about £15 million. There has been much in the North-Eastern press about the matter as well as

  1643
  broadcasts on television and radio. I have heard £40 million mentioned, but £15 million seems a realistic assessment. I concede that that is a considerable sum, but it must be put into context. It is small in relation to the problems.
  It will come as no surprise to the Minister to know that I dealt with his predecessor for several months. My hon. Friend the Member for Greenwich (Mr. Barnett) could not have been more helpful or sympathetic. I have to say that, too, for the staff of his office. I do not think that I am revealing any secret when I say that the Labour Government had come to a conclusion prior to the general election. The council would have received an adequate grant to cover most of the work. It is most unfortunate in more ways than one that we now have a new Government.
  I hope that there will be continuity of thinking. There has been some delay because the former Government sought the views of the Association of District Councils. As we know, the houses in the new towns were taken over by the district councils on 1 April 1978. The houses are now their responsibility. It was inevitable that some councils would object to the condition of some of the houses.
  It was proper and understandable that the Government of the day should consider the picture as a whole. It is important that the then Minister did not preclude any local authority from submitting proposals and claims for financial assistance unilaterally. Easington district council did that and did it extremely well.
  I have been worried for some time about the response of the Department of the Environment, which laid down certain conditions in response to the representations that have been made by the ADC. It is important that the conditions should be placed on the record. Therefore, I shall quote the second paragraph of the letter dated 19 March 1979 from the Department to the secretary of the new towns committee of the Association of District Councils. It states:
  "We have considered the Association's representations but I think I should make it clear at the outset that there are certain categories of work which we cannot regard as eligible for grant. These are as follows: (a) matters covered by byelaws or building regulations current when the buildings were approved;
  1644
  (b) renewal or replacement to outworn or outdated items of equipment or services; (c) any form of improvement; (d) normal maintenance. All these are, in our view, clearly outside the scope of Section 10 grant."
  On the surface that seems reasonable, but when councils have discussed detail they have found that it is capable of the widest interpretation and might result in no local authority receiving anything. In other words, the Department would not pay out a penny to help in what are, frankly, quite critical circumstances.
  At this point I would support the Association of District Councils by saying two things—first, that the removal of basic design faults should be admitted in all cases and, secondly, that where dwellings are unsatisfactory by reason of faulty construction or bad workmanship this should be a proper subject for claim. I submit to the Minister that that is a fair compromise on the kind of conditions that were laid down and that were based on the paragraph I have just read.
  My main plea is that this is a special case. I do not pretend that there are not similar problems in other new towns; that is manifestly so. However, I challenge the Minister to name one new town which has this problem on this scale. I look forward to hearing his comments on that challenge.
  The evidence was prepared in great detail by Easington district council and submitted to the Minister. I am not sure whether he has yet had time to consider it in detail. I see that he is shaking his head. Frankly, it is such a huge file that I can understand that, as a new boy at the Department—if I may phrase it in that way—he will have had many other things to do, but it is essential reading. He will see the purport of my case embodied in those documents.
  In the circumstances it simply is not possible for the local authority to provide this amount of money. I cannot overstress—I hope that the Minister will pay attention to this—that the work must be completed this winter. We who live in the North-East have winters such as are not experienced in any other part of the country. Last winter we were snowbound when in the South the sun was shining. I live up there and I know exactly what it is like. The tenants of these houses in this new town simply cannot endure another winter such as the last one in the sort of conditions that I am talking about

  1645
  tonight. The need is urgent, the case desperate and, in my estimation, unanswerable.
  If he has not done so already, the Minister will be getting a request from Easington district council to receive a deputation. I know that he is a sympathetic man and I hope that he will readily agree to meet the deputation. In an Adjournment debate of this kind it is not possible to do more than outline the main points of the case. The detailed submissions, which I concede are necessary to convince a Department and a Minister, can be made only in a face-to-face meeting with the councillors and officers present. I hope that he will receive that request within the next few days.
  I conclude by congratulating the Minister on his appointment. It is an onerous and an important one. There is a great deal of important work to be done. When the hon. Gentleman was an Opposition Back Bencher, only about six weeks ago, he had an enviable reputation. He was regarded as able and as knowledgeable, particularly in local government affairs. But, above all, he was regarded as being very flexible in debates—I mean this sincerely—and very humane. What I am worried about is that now that he is in the clutches of the Iron Lady he might not be so flexible and humane.
  I urge the hon. Gentleman not to accept the doctrinaire policy that the present Government have already adopted, and have made widely known, of indiscriminate cutting of public expenditure regardless of the merits of the case. In the short time that I have had, I hope that I have convinced the hon. Gentleman that, at the very least, my case is worthy of very substantial and immediate investigation.
  A decent home is a fundamental requirement of civilised living. I hope that the Minister will respond to my plea and respond very quickly on what we in our area regard as a most important matter.
  10.41 p.m.
  The Under-Secretary of State for the Environment (Mr. Geoffrey Finsberg): I start by thanking the hon. Member for Easington (Mr. Dormand) for his kind words. I shall do my best to make certain that they do not influence the reply that I am about to give him.
  1646
  The hon. Member is perfectly right in saying that no new town has experienced the problem on the same scale. I have not read the entire file—also a perfectly fair comment of the hon. Member—but I have read more than enough to be able, I hope, to give the hon. Member an answer that may not leave him too dissatisfied.
  The House, certainly, and the hon. Member's constituents will be grateful to him for raising this subject tonight, because, as he rightly said, people value decent housing. It was, after all, an important plank in the programme that we put to the country and which contributed significantly to the massive endorsement of our policies that we received from the electorate just seven weeks ago.
  It is right to pay tribute to what the Peterlee development corporation has done. I can assure the hon. Member that the comparatively small cuts that we have made should have little, if any, effect upon Peterlee's industrial programme this year. The corporation deserves great credit for its outstanding success, with the resultant increase of 1,000 jobs in the past two years.
  I turn to the hon. Member's representations on behalf of Easington for financial aid for remedial work needed to the estates that the council took over last year from the Peterlee development corporation—assistance additional to the fairly substantial tapering grant that the authority is receiving already from the Department under section 10 of the New Towns (Amendment) Act 1976.
  The hon. Member asked that the Government should stand by "a commitment" by the previous Administration to pay additional grant. Let me first examine exactly what that "commitment" was. The only details of the Labour Government's offer were set out in a letter sent to the Association of District Councils on 19 March. That letter did not in any way specify the level of assistance, the proportion of expenditure to be met by grant, nor indeed did it state at all clearly the nature of the work that might qualify for aid. However, the letter did spell out the kind of work that would not rank for grant, as the hon. Member has very rightly reminded the House. It was not a very forthcoming letter after so long a period of gestation.

  1647
  But my right hon. Friend the Secretary of State, in the debate on the Address, has already drawn attention to many instances of indecision and inaction on important matters of housing policy by the former Government Ministers during their recent tenure of office.
  Having pressed the previous Government for so long—as I gather that the hon. Gentleman admitted at the end of March during a BBC television discussion in the North-East—he could perhaps be forgiven had his mind turned to that particular issue on the occasion of my right hon. Friend's speech during the debate on the Address.
  While inviting claims within prescribed and constricted rules, the Department's letter to the ADC went on to stress the favourable outstanding loan debt terms on which the new town's housing had been transferred to the local authorities. Those terms reflected what was called the "warts and all" basis of the general settlement. That was the clear intention of the 1976 Act. The hon. Gentleman knows that better than I, because he was a Whip at that time.
  On 26 June 1976 on the occasion of the Bill's Third Reading, the right hon. Member for Deptford (Mr. Silkin) told the House that the transfer terms for the first generation new towns would:
  "enable the local authorities to increase their housing stock at capital costs of from one-third to one-half of the true capital cost." [Official Report, 26 June 1976; Vol. 913, c. 627.]
  For Easington, the total acquisition costs of the Peterlee housing amounted to just under £2,900 per dwelling, which is a derisory sum by today's standards. That low price reflects the fact that much of the Peterlee housing was built more than 15 years ago. I do not think that if any of us bought for less than £3,000 a house more than 15 years old we should expect it to be "as new".
  At this stage let me put the Hon. Gentleman out of his misery. When we took office we made it clear that as far as we were able we would honour genuine commitments that may have been entered into by our predecessors. As I explained, I have considerable doubts about the true meaning and extent of the offer that was given to the ADC. The qualifications read out by the hon. Gentleman and to
  1648
  which reference was made make that clear.
  I will ask the Department to give fresh consideration to the points that the hon. Gentleman has made and reopen discussions with ADC strictly on the basis of the earlier limited proposal made to it. That does not mean that the local authority claims will by any means be met in full. It follows that any additional works put in hand following the discussions will have to be fully contained within the overall new town's local authority housing programme That means compensating savings elsewhere.
  Mr. Dormand: Will the Minister assure me that the reappraisal will be set in hand immediately, for the reason that I gave?
  Mr. Finsberg: It is more complicated than that, but I shall try to help the hon. Gentleman. I said that there would have to be compensating savings elsewhere. In connection with the letter that the hon. Gentleman says that Easington is sending to the Department, if Easington has now written asking for a deputation to be received, that will obviously be carefully taken into account. I hope that the hon. Gentleman will feel that there would be little purpose in seeing that deputation while the general negotiations for the ADC take place.
  I suggest that the council re-examines its own claim and resubmits it within those items for which the Department has already said that grant would be payable. That means that it must exclude the items where the Department has said that grant would not be payable. I put it in that rather convoluted way because I want the hon. Gentleman to understand that I am trying to be as flexible as I can within the terms of correspondence already sent by one of his colleagues. Obviously I have not been able to see the background notes to that particular saga.
  I mentioned earlier the price. It is right to say something else about the transfer of new town houses, which may be of assistance to the House. We have never been against the principle of housing transfer for local authorities. What has happened in the hon. Gentleman's constituency shows that there is bipartisan support on that.

  1649
  However, the sooner new towns become ordinary towns the better. The hon. Gentleman and I are not divided on that point. The Conservative Party has made that point of view clear on many occasions. At every stage during the debates on the 1976 Act we argued that tenants in the public sector aspire to own their own homes. There are many such tenants in the new towns, as there are in every local authority area. Those tenants are capable of buying at once and should be given the opportunity to do so. My hon. Friends the Members for Basildon (Mr. Proctor), for Northampton, North (Mr. Marlow) and Northampton, South (Mr. Morris), for Peterborough (Dr. Mawhinney), for Hertford and Stevenage (Mr. Wells) and for Welwyn and Hatfield (Mr. Murphy) are indebted to the Labour Government for not having learnt that lesson.
  The Department will gladly consider any evidence that the local authority can put before us. Easington is not the only new town with this problem. Therefore, negotiations must continue with the Association of District Councils. However, I am not clear about the Labour Government's former intentions. I do not know how far down the path of additional grants they were prepared to go. The documentation available to me is not clear and the generous terms on which the housing was handed over clouds the issue.
  I repeat what the hon. Gentleman has said about the wording of the letter that was sent to the ADC in March. By its reply, the ADC understood that letter. The letter stated that the four categories could not be covered. Flexible though I would like the situation to be, I do not believe that it would be possible to reopen the categories. It is self-evident that they should not be covered by a fresh examination.
  That does not mean that other matters cannot be covered. I cannot tell the hon. Gentleman how quickly a decision will be reached. If Easington's letter gives us the information that we seek we shall hold talks with the ADC in parallel. When a formula has been agreed with the ADC we shall examine urgently the problems of the authority that the hon. Gentleman has raised.
  1650
  I hope that the hon. Gentleman believes that the Government will examine the matter sympathetically—not just because he has raised it in a manner the House expects, in that he has given the facts as fully as possible, but because, if possible, we want people not to suffer the conditions that he described, of a bad winter like that of last year. It was not only the North-East that suffered from heavy snow; some of my friends in East Anglia were snowed up for five days. They did not find it helpful to have a friendly wave from above by the "Minister for Snow" flying in a helicopter. That did not produce the sunshine.
  I do not believe that I can give the hon. Gentleman more information on the point. I hope that he will use his influence in the matter. Easington council, like every other local authority, has been given wide powers in advance of the "right to buy" legislation that we intend to introduce. The authorities can sell the houses they control at generous discounts below the current market value. Sales of the former Peterlee houses to tenants who wish to buy their homes, even at a discount, would be financially advantageous to the council—given the amount it paid for the dwellings and its need to finance remedial work elsewhere.
  I urge the council strongly to exercise its sales power to the full, in its own interests, as well as in the interests of its tenants. If it does not, the only people who will suffer are the tenants. We have inherited inflation from the hon. Gentleman's Government and if he does not use his considerable charm and influence on his local authority the tenants will suffer because of the authority's dogma.
  If the hon. Gentleman still feels, after the ADC negotiations and after we have been able to consider a formula that might apply to Easington, that a deputation is needed, I shall be delighted to receive it. I hope, however, that by that time we shall have cleared the way and he will not feel it necessary to bring a deputation.
  Question put and agreed to.
  Adjourned accordingly at five minutes to Eleven o'clock.

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EMPLOYMENT
  Micro-chip Technology
  Micro-chip Technology
  Unemployment Forecasts
  Unemployment Forecasts
  Small Businesses (Employees)
  Small Businesses (Employees)
  Fire Regulations
  Fire Regulations
  Motor Fuel (Price Increases)
  Motor Fuel (Price Increases)
  Home Workers
  Home Workers
  Work Force (Annual Statistics)
  Work Force (Annual Statistics)
  Brigg and Scunthorpe
  Brigg and Scunthorpe
  European Community (Average Earnings)
  European Community (Average Earnings)
  Working Mothers
  Working Mothers
  Liverpool
  Liverpool
  School Leavers (Tyneside)
  School Leavers (Tyneside)
  Youth Opportunities Programme
  Youth Opportunities Programme
  One-Parent Families
  One-Parent Families
  Manpower Services Commission
  Manpower Services Commission
  Work Introduction Courses
  Work Introduction Courses
  Small Firms Employment Subsidy (Lambeth)
  Small Firms Employment Subsidy (Lambeth)

Preamble
The House met at half-past two of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Norwich):
The LORD CHANCELLOR on the Woolsack.
Several Loords—Took the Oath.

RHODESIA SANCTIONS: BINGHAM REPORT REVELATIONS
Lord HATCH of LUSBY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what further action they intend to take over the revelations of the Bingham Report.
Lord TREFGARNE: My Lords, as your Lordships know, this is an issue which the previous Government were unable to resolve. My right honourable friend the Lord Privy Seal stated in another place on 13th June that the Government are considering the matter and that a Statement will be made as soon as possible.
Lord HATCH of LUSBY: My Lords, I thank the noble Lord for his courtesy in answering my Question. May I ask him to draw to his right honourable friend's notice the fact that it was a member of his party who stated that, arising out of the Bingham Report, the whole integrity of Parliament was at stake and that, therefore, there is a very strong inter-party case for further examination of the responsibility for the revelations that were made by Bingham in his report?
Lord TREFGARNE: My Lords, I will certainly draw those words to my right honourable friend's attention.
The Earl of LAUDERDALE: My Lords, would the noble Lord not agree
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that it is the integrity not of Parliament but of the United Nations which is at stake in this ridiculous performance of sanctions on Rhodesia which have been broken by country after country?
Lord BROCKWAY: My Lords, is there not a great danger—
Several noble Lords: Order!
The LORD PRESIDENT of the COUNCIL (Lord Soames): My Lords, I understand that the noble Lord, Lord Hale, was called for the next Question.

DIOXIN: CONTROL OF USE
3.3 p.m.
Lord HALE: My Lords, if it be the wish of the House, then, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what steps have been taken to restrict and control the continued import of products containing dioxin, in view of the evidence of its extreme toxicity and of recent drastic action taken in other countries.
Lord SANDYS: My Lords, the necessary safeguards in the United Kingdom relate to marketing generally, rather than only to imports. The Medicines (Hexachlorophane Prohibition) Order 1973 prescribes the very limited circumstances in which such products can be supplied for medicinal and allied purposes. When they are supplied for use on the land, their marketing is subject to the Pesticides Safety Precautions Scheme. In the light of data from our own and other countries, the Advisory Committee on Pesticides has lately undertaken a detailed review of United Kingdom safeguards concerned with dioxin. I am sending the noble Lord a copy of the reassuring report which the committee has rendered.
Lord HALE: My Lords, while thanking the Minister for that helpful Answer, it was not quite clear. I thought he said that the Committee on Pesticides was considering the matter, and then I under-

1105
stood him to say that he would send me a copy of the report. Does he mean that when it arrives one can still make representations and submit evidence to the committee, or what is the procedure? May I make just this quick point: Dioxin has been banned throughout America, or certainly throughout the State of Oregon and the forest there, by the Experimental Advisory Agency. It is the subject of what is nearly a civil war in Italy. It has been described by a prominent American chemist as the most dangerous poison in the world, and it is now known that under heat people are being killed by innocently putting herbs on bonfires.
Lord SANDYS: My Lords, the noble Lord underlines the fact that this is a very technical subject and certain other countries have indeed banned it. I would remind the noble Lord that it is banned in the United States of America for certain purposes only, and it is perfectly true that a ban exists in the Netherlands. It is, however, in use in France and Germany subject to limitations and inspections. But I would remind the noble Lord of one other factor, which is that the Advisory Committee on Pesticides is the body which advises the Government on all matters relating to this and no Government, past or present, has ever acted other than upon the advice of that committee.
Lord WYNNE-JONES: My Lords, will the noble Lord pay attention to the fact that, although he is quite right in saying that expert opinion has been consulted, and indeed a lot of trouble has been taken, there is still a good deal of disquiet about this matter? If the consequences are as serious as has been suggested by several people, they can affect mankind quite considerably. Therefore, it is not good enough simply to say that expert advice has been taken. I speak as one who in some respects is sometimes regarded as an expert, and therefore I know only too well how dangerous it is to rely simply on such expert advice. Therefore, will the noble Lord press the Government to pay the closest possible attention to this matter and to look into all the ramifications?
Lord SANDYS: My Lords, I will most certainly draw the attention of my right
1106
honourable friend to all the remarks made by both noble Lords in your Lordships' House this afternoon. Of course, this matter has very wide implications in the whole field of pollution.

LICENSING COMPENSATION FUND: DISPOSAL OF MONIES
3.8 p.m.
The Earl of KIMBERLEY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what is the current position of the Licensing Compensation Fund.
The PARLIAMENTARY UNDERSECRETARY of STATE, HOME OFFICE (Lord Belstead): My Lords, discussions have for a considerable time been in progress between the Home Office and the Brewers' Society and licensed trade organisations about a possible scheme for disposing of the funds. We are now waiting for those bodies to approach us with modified proposals as a basis for further discussion.
The Earl of KIMBERLEY: My Lords, I thank the Minister for that Answer. Is he aware that last July—which I agree was not in the time of this Government—discussions were taking place between the Department of Health and Social Security, the Home Office and the Treasury over the disposal of these funds? Secondly, is he aware that the National and Medical Councils on Alcoholism are charitable bodies? Therefore, if the Brewers' Society and the Licensed Victuallers' Association have given their blessing to donating 50 per cent. to charity, would this not cut down public expenditure by having the two alcoholic councils subsidised by that, instead of by the Government?
Lord BELSTEAD: My Lords, I am aware that discussions on the disposal of these funds have been going on for a very long time indeed, and my noble friend and other noble Lords have shown considerable patience with the replies which successive Ministers have had to give in answer to this question. But I ought to say this to my noble friend. Following informal talks in February, the Brewers'

1107
Society undertook to produce a draft of a scheme under which the Society would take on a major part of the administration of repaying 50 per cent. of the fund. If that can be done, then the last part of the noble Earl's supplementary—namely, about setting up a trust fund—could possibly also be achieved. So that, first, there has to be a repayment before a trust fund can be set up.
The Earl of KIMBERLEY: My Lords, I thank my noble friend for that answer.

BRITISH RAIL: CUTS IN DIESEL SERVICES
3.10 p.m.
Viscount SIDMOUTH: 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 are satisfied with British Railways' reported decision to curtail diesel services in rural areas, owing to shortage of fuel.
Lord MOWBRAY and STOURTON: My Lords, it is for the British Railways Board to decide what changes in rail services are needed in order to save fuel.
Viscount SIDMOUTH: My Lords, while thanking the Minister for that reply, may I ask him whether he is aware that British Rail already seem to be in some trouble about replacing their diesel stock, specifically the multiple units which run some of the commuter services? There is a danger, therefore, that the fuel shortage might be used as an excuse for cutting down or, indeed, cutting out some of these services, thereby increasing the use of petrol.
Lord MOWBRAY and STOURTON: My Lords, our understanding is that the British Railways Board intend to maintain freight services—for example, coal to power stations and services for work and business travel. The cuts are concentrated on off-peak local passenger services and are effected by reducing the number of trains and shortening them. Also, good housekeeping methods, such as not keeping engines running, are being implemented.
1108
I apologise for my laryngitis, which makes it hard for your Lordships to hear me.
Baroness STEDMAN: My Lords, is the noble Lord able to give an assurance to the House that while we expect British Rail and the National Bus Corporation to play their part in saving fuel in so far as they can, it is essential that our rural services should be kept going and that areas of the country should not be deprived of all kinds of transport? Is he prepared to give an assurance to the House that if the situation becomes worse he will see what he can do and what efforts he can make to ensure if necessary, that extra fuel is made available to British Rail and to the National Bus Corporation in order to maintain services in rural areas?
Lord MOWBRAY and STOURTON: My Lords, I appreciate totally what the noble Baroness is saying. The British Railways Board have every intention of keeping all the services possible going. If the situation were to worsen, they would certainly have consultations with my right honourable friend. At the moment, the amount of fuel coming into this country is the same as last year. It is merely that the fuel demand in this country has increased.
Lord SHINWELL: My Lords, is it necessary altogether to suspend railway traffic in rural areas simply because there is a fuel shortage? Is there not another form of fuel? I am no expert on this subject, but perhaps the noble Lord can inform me whether or not it would be possible to utilise some of the steam engines, using coal as fuel, as a temporary measure until the oil fuel shortage is overcome?
Lord MOWBRAY and STOURTON: My Lords, the versatility of the mind of the noble Lord, Lord Shinwell, is such as to command admiration from all quarters. I am sure that the British Railways Board, if the need were to arise, would consider such a measure, but at the moment it is not necessary. Services in rural areas are not being severely cut. The British Railways Board have every intention of keeping going as good a service as is possible. As I have already said, the cuts at the moment are minimal.
Lord NORTHFIELD: My Lords, is it not the case that we, the British, have agreed with our partners in the European Economic Community to cut by 5 per cent. this year our consumption of imported fuels? Is it not therefore inevitable that marginal services, like those in rural areas, will suffer unless a careful eye is kept on them? Can the Minister not respond to the question which was put by my noble friend on the Front Bench and say that, in the event of any danger of that kind, he will do his best to make sure that at least these services are kept going?
Lord MOWBRAY and STOURTON: My Lords, this is a matter for future policy. The necessity does not arise in the present situation. British Rail are hoping to cut their use of diesel fuel by some 4½ per cent., by cutting down on a few off-peak period trains and by better housekeeping. If the situation were to worsen, my right honourable friend would no doubt have consultations with the British Railways Board.
Lord MURRAY of GRAVESEND: My Lords, is not this the opportunity for the Government to assist British Rail in every way they can to bring people back to the railways and to take some of the traffic off the roads?
Lord MOWBRAY and STOURTON: My Lords, if that were to happen, the British Railways Board would be very pleased.
Lord WYNNE-JONES: My Lords, while I do not wish to exacerbate the noble Lord's laryngitis, may I ask him whether British Rail have considered an electro-chemical solution to their problem? —namely, the introduction of battery operated trains which 60 years ago in Ireland were run with great success. Battery operated trains are particularly suitable for running short distances and for this type of service. Would the noble Lord suggest to British Rail that the introduction of battery operated trains, which would not involve the use of diesel or, indeed, any hydro-carbon fuel, might be the ideal solution to this problem?
Lord MOWBRAY and STOURTON: My Lords, the noble Lord, Lord Wynne-Jones, has given me much food for
1110
thought, none of which I knew about, and my brief does not inform me! However, I can tell the House that a joint review of main line electrification is in progress in the Department of Transport, and my right honourable friend the Minister of Transport expects to receive an interim report this summer. He will, of course, take into account any energy implications contained in this report.

MPs' AND MINISTERS' SALARIES
Lord SANDYS: My Lords, with the leave of the House, at a convenient moment after 3.30 p.m. this afternoon the Lord President of the Council will make a Statement on the pay of Members of Parliament and Ministers.

JUSTICES OF THE PEACE BILL [H.L.]
3.17 p.m.
The LORD CHANCELLOR (Lord Hailsham of Saint Marylebone): My Lords, I rise to move that this Bill be now read a second time. It consolidates quite a number of enactments relating mainly to the framework of organisations within which justices of the peace and their clerks exist and operate. The enactments date from as wide a range as 1742 and 1978. It is a pure consolidation Bill. It makes no changes in the existing law and, if read a second time, will be referred to the Joint Committee on Consolidation Bills in the usual way. I beg to move.
Moved, That the Bill be now read 2a. —(The Lord Chancellor.)
Lord ELWYN-JONES: My Lords, I think that the House will welcome this consolidation Bill, like the one which is to follow it, as a helpful addition to the considerable achievement which has taken place in the consolidation of Acts of Parliament. Already during the course of this year there have been no fewer than 14 consolidation Acts, some of them very substantial. I think it is fitting to pay tribute to those who have done, and who continue to do, the difficult work of consolidation, particularly parliamentary counsel and those at the Law Commission and in Government departments who devote a lot of time and trouble to this

1111
task, and also to the Members of both Houses who sit on the Joint Committee on Consolidation Bills.
The immediate Bill consolidating legislation relating to justices of the peace will, I know, be welcomed by them, embracing as it does, as the noble and learned Lord the Lord Chancellor has said, legislation as old as 1742 and as young as 1978. Anything that can be done to help the magistrates in the performance of their duty is clearly beneficial, because they play a vital role in the administration of justice and do so voluntarily, often at great inconvenience to themselves. I think it is desirable that from time to time their work should receive acknowledgement in your Lordships' House.
The LORD CHANCELLOR: My Lords, I am very grateful to the noble and learned Lord for the gracious words which he has spoken. I know that they will give profound satisfaction to those to whom he has referred. I think I might say—and it will be no secret to either of us—that the preparatory work for the Bills which I am now proposing, and which for some time to come I shall be proposing, was carried on under the auspices of the noble and learned Lord.
On Question, Bill read 2a, and referred to the Joint Committee on Consolidation Bills.

SALE OF GOODS BILL [H.L.]
3.20 p.m.
The LORD CHANCELLOR: My Lords, I rise to move that this Bill be read a second time. This again is consolidation: it extends to the whole of the United Kingdom and is concerned with the very important legislation relating to the sale of goods. I am particularly glad that this consolidation has come forward so early in this Parliament, and I am sure that your Lordships will wish it to be speedily enacted. If the Bill is given a Second Reading, it will be referred to the Joint Select Committee under the chairmanship of the noble and learned Lord, Lord Keith of Kinkel, in the usual way.
There is one somewhat unusual feature about this particular Bill, to which I ought perhaps to draw your Lordships' attention.
1112
It restates the old law as it has been since 1894 as well as providing a clear statement of the position for the future. Why? Because in its nature it cannot be retrospective; different rules apply to contracts, depending upon whether they were made, for instance, under the old law which has been changed from time to time —in 1967, 1973 and 1978—and, of course, the older contracts are governed by the older law. I hope the Joint Select Committee, and indeed the eventual users of the statute, will find Schedule 1 to the Bill of assistance to them. I beg to move.
Moved, That the Bill be now read 2a.—(The Lord Chancellor.)
Lord ELWYN-JONES: My Lords, the House will be grateful to the noble and learned Lord the Lord Chancellor for his explanation of the interesting innovations in this Bill. It is long overdue, and I am grateful to him for his earlier generous references to myself.
The LORD CHANCELLOR: My Lords, I thank the noble and learned Lord. This, again, is something as to which I have to acknowledge the very large responsibility of the noble and learned Lord for the preparation of this, as of other measures.
On Question, Bill read 2a, and referred to the Joint Committee on Consolidation Bills.

CONSERVATION OF WILD CREATURES AND WILD PLANTS (AMENDMENT) BILL [H.L.]
3.23 p.m.
Lord SKELMERSDALE: My Lords, 10 days ago I was giving preliminary thought as to what I should say on this occasion, bearing in mind that it would have been the third time of asking your Lordships to give a Second Reading to this particular Bill. However, I am glad to be able to tell you that this afternoon the scenario is somewhat different, for reasons which I will now explain. Owing to the rather late arrival this morning of the Official Report in your Lordships' House, many of your Lordships may not have had the benefit—at least I hope it is a benefit; I think it is—of seeing my Question for Written Answer and the Answer to it

1113
given by my noble friend Lord Mowbray and Stourton, so with the leave of the House I will take the unusual step of actually reading from column 1102 of the Official Report. My Question was to ask Her Majesty's Government:
"Whether they intend to strengthen legislation to protect wildlife in the near future".
My noble friend's reply was:
"Yes. It is our intention to introduce in this Session a Bill which, in broad terms, will seek to strengthen the protection afforded to wildlife and their habitats and to embrace our international obligations".
As your Lordships are undoubtedly aware by now, the aim of my Bill, to which I had intended to ask your Lordships to give a Second Reading today, was to extend and strengthen the provisions for protecting and conserving wild creatures and wild plants, as indeed does the Government Bill which we now know has the draft title of the Countryside and Wildlife Bill. My own Bill, the Conservation of Wild Creatures and Wild Plants (Amendment) Bill, had the support of the Nature Conservancy Council, the Government, the Department of the Environment itself—which, I might say, do not necessarily go together—and all the voluntary conservation bodies, all of whom worked extremely hard and extensively with me in its preparation, as indeed did the loyal servants of this House, who so often do most of the work but so seldom get any of the credit, and I hope on this occasion they will take it as being given.
It is my experience in the field of conservation legislation that the Nature Conservancy Council and the various voluntary bodies, who in effect operate and police our wildlife legislation, need more time than other sections of the community to forward their ideas to the appropriate Government departments and the voluntary pressure groups. I shall be most grateful, therefore, if my noble friend will be prepared to elucidate just a little more at this stage as to the broad fields that the wildlife section of the proposed Government Bill will cover. Also, bearing in mind the great expertise in this subject held by Members of your Lordships' House, I hope he will use his best endeavours to ensure that this important Government Bill comes up for discussion in this House before it goes to another place. Notwithstanding the answers to
1114
those two questions, in the circumstances I beg leave to withdraw the Conservation of Wild Creatures and Wild Plants (Amendment) Bill.
Moved, That the Bill be withdrawn—(Lord Skelmersdale.)
Lord MOWBRAY and STOURTON: My Lords, I should like to thank my noble friend for having agreed to withdraw his Bill. I regret that I am unable to elucidate for him further what the Government intend to put in their Bill. We have said that we arc willing to take cognisance of all his proposed legislation, and if in the interval he would like to be in touch with me and with my right honourable friend, we will do everything possible to take his views into account. Whether it will start in this House or another place I am afraid I can give my noble friend no guarantee, but I can assure him that I will do my best to see that any wishes he has are put into practice, or those of any other of your Lordships who have special interests.
Baroness STEDMAN: My Lords, from this side of the House I should like to say how much we welcome the opportunity in the near future of perhaps having a rather wider Bill than this one; and, at the same time, I should like to offer my regrets to the noble Lord, Lord Skelmersdale, after all the work he has put into this Bill, that he is not going to have the credit for it.
Lord SKELMERSDALE: My Lords, I am very grateful to both the noble Baroness, Lady Stedman, and my noble friend.
On Question, Bill, by leave, withdrawn.

THE SHIPPING INDUSTRY AND ECC REPORT
3.28 p.m.
Viscount ROCHDALErose to call attention to the problems of the shipping industry and to the Twelfth Report of last Session of the European Communities Committee on EEC shipping policy (H.L. 70, 1978–79); and to move for Papers. The noble Viscount said: My Lords, in calling attention to the problems

1115
of the shipping industry and in particular to the Twelfth Report of your Lordships' Select Committee on European Affairs, I do not have to remind your Lordships how vital our shipping industry is to the United Kingdom. We all know that that goes without saying, but, regrettably, I suggest that it is all too often interpreted as being taken for granted and, while that may be regarded as a compliment, it is, I suggest, a rather dangerous compliment.
In my Motion, I refer to the Twelfth Report for 1978–79, which deals with shipping policy generally and with competition from cargo liner fleets of State trading countries in particular. Your Lordships will have noticed that the Committee recommended that this important matter should be debated in your Lordships' House but should be debated against a background of much wider shipping policy. That is the purpose of my Motion today.
The noble Lord, Lord Trevelyan, who is Chairman of Sub-Committee B, which really produced the Twelfth Report, did me the honour some time back to invite me to move the Resolution which his Sub-committee and the Select Committee itself recommended, and I am most grateful to him for that invitation. Originally, the Motion was down to be debated on 12th April but of course, like other debates, it fell with the general election. It is not without significance that there have been important developments in this field in the interim period, and of course, in saying that, I am not referring to the election but to other relevant developments. I mentioned the noble Lord, Lord Trevelyan. I feel I must say this. The noble Lord is regrettably not with us today because, as many of your Lordships will know, he has recently undergone some serious operations. I spoke to Lady Trevelyan this morning to find out how he was getting on, and your Lordships will, I am sure, be glad to hear that, while his progress is slow, progress is being maintained. I would like to send him, personally, a hope that he will very soon be in his place in this Chamber again.
My Lords, I want to start with a brief look at the United Kingdom shipping industry as a whole and its position in the world today, in order that, coming to more particular points, one can have
1116
the right perspective. The United Kingdom shipping industry has, I suggest—and I can say this as I have no personal axe to grind—much to be proud of. It stands fourth in tonnage in the world after Japan, Liberia and Greece. Its ships are today, on an average, no more than seven years old, and they are highly sophisticated. The ships owned and registered in this country represent something like 7 per cent. of world tonnage. The industry employs 80,000 people directly, and it contributes the remarkable —as I think I can say—figure of £l½ billion sterling a year to the United Kingdom balance of payments. Its record for investment as an industry can be said to be second to none in this country. That investment of course includes a lot of new technology, and it has been estimated that, between 1966 and 1976, the investment was the equivalent of £1 million a day. That is a pretty remarkable figure.
The industry has led the world in the development of container ships, and let us remember that, broadly, one modern container ship can be said to be the equivalent of something like ten traditional cargo liners. It has the largest refrigerated cargo fleet in the world, the second largest gas fleet, the third largest chemical fleet, and, along with those material assets, it has made great strides to match the selection and training of seafarers at all levels to the high standard of its fleet. Admittedly, it is no longer right at the top of the tree dominating the world's fleets as it used to be. But I do feel that what I have quoted are impressive facts, and although the return on capital has been rather varied at times, the United Kingdom shipping fleet really has nothing to be ashamed of in its efforts to keep right ahead and to meet the major problems that confront world shipping as a whole today.
I would suggest to your Lordships that shipping is probably the most vulnerable of all industries to outside economic influences. If we look at the world shipping picture since the OPEC crisis in 1973, what do we see? We see that it has experienced the worst recession since the 1930s. A massive slowing down in the demand for shipping, together with a huge world order book inflating the world's fleets, resulted in a collapse in freight rates and severe over-tonnaging.

1117
Although, of course, the situation varies with different sections of the industry, if we take one example—that of tankers —current thinking for tankers is that the proper balance between supply and demand is unlikely to be achieved until at any rate the early 1980s. This world surplus of tonnage, which has been with us already for some years now, is not correcting itself anything like as quickly as one would like, perhaps due to some extent to the understandable desire of many Governments to see what they can do to maintain employment in their shipyards.
In mid-1978, just a year ago, the deadweight tonnage of ships laid up worldwide was 57 million tonnes, and it has been estimated that slow speed steaming disguised at least a further similar amount. In short, one-sixth of the world's fleet, largely tankers, was surplus. During the second half of 1978, there was an improvement, laid-up tonnage falling to some 30 million tonnes and freight rates increasing to levels which provide, as I understand it, a degree of viability. But since then events in Iran and uncertainty of world trade, from whatever cause it may arise, have left a very inscrutable future.
The United Kingdom, of course, has not been immune to all these events but has probably fared rather better than average, at any rate up to 1977. However, in 1978 our situation deteriorated and in the middle of last year 6 million tonnes or 13 per cent. of our fleet were inactive. There have, of course, been some bright spots—ferry operations, cruise ships. The position for container ships, to which I have already referred, has also been good, but even here there are now signs of over-tonnaging. At any rate, our laid-up tonnage has dropped to some 3½ million tonnes, and this includes some disposals, but the outlook is still very obscure. So the situation is a very difficult and murky one, and it is in that situation that we have today three major problems, among others, which I want to look at.
There is, first of all, the United Nations Code for Liner Conferences. There is the friction caused in Western circles by certain aspects of United States shipping policy. And then there is the matter
1118
referred to specifically in my Motion—the impact of unfair competition from the cargo liners of State trading countries. I shall largely confine my comments to those three issues in the order in which I have mentioned them, because I think they build up logically in that way. But there are, of course, other problems. There are the efforts in UNCTAD to deal with and regulate bulk trades; there is the question of flags of convenience; there are the discrimination practices of certain countries, including the State trading countries. No doubt other noble Lords who will be speaking from great experience will deal with those points as well. I may make just a very brief comment later on the bulk trades.
As regards the United Nations Code for Liner Conferences, I should remind your Lordships that there are in the world something like 300 conferences. They play an extraordinarily important part in the United Kingdom shipping industry. They have, of course, from time to time—let us admit it—caused critical comment from various directions. They have been regarded as cartels, and in fact they are. I certainly shall not go into any details as regards that now: suffice it to say that when the Committee of Inquiry, of which I had the privilege to be chairman, reported to the Government of the day in 1970, we came to the conclusion, after very careful study and taking a great deal of evidence, that if shippers who were not able to charter complete ships for their own trade were to have the regular and efficient service required for their trade at quoted prices, and if shipowners, with their capital intensive industry were able to provide that on a viable basis, then the so-called "closed conference" was the answer. We pointed out that the system must be properly monitored and that it was really essential although one recognised then, as one does today, that the closed conference is anathema in the United States. In passing I should like to stick my neck out and urge some of our more leading industrial shippers to take a more active personal interest in shippers' councils, the work of which is so important when it comes to the consideration and operation of conferences. However, I must, of course, remind your Lordships that shippers' councils are also, I think, illegal in the United States.

1119
The problem to which we now particularly come as regards liner conferences concerns the question of developing countries, which naturally want to have access to membership of these conferences that serve their own trade, and they want to have some allocation of their own trade. The United Nations Liner Code of 1974 tried to bring that about—indeed, that was its purpose. The United Kingdom shipping industry and, I think, successive Governments, have always recognised that some access to these conferences was reasonable. But the United Nations code, which as I say was intended to bring that about, caused considerable doubts and difficulties. The United Kingdom did not accept or ratify it. I shall not go into the details. They are involved and admirably laid out in another report of your Lordships' Select Committee—the 25th Report for 1977–78 —although that report, at the time, was not discussed in your Lordships' House.
Very briefly, the code provided for access to conferences by developing countries and the sharing of their cargoes to and from them on the basis of the so-called 40–40–20 formula which I have no doubt your Lordships know all about. The difficulty arose not only from the provisions of the code itself, which many felt were far too rigid, probably unworkable and even likely to result in the mandatory transfer of traffic from efficient lines to inefficient lines. That was one of the problems. However, the other problem was that it created considerable differences of opinion in the EEC as to how member-States should react to it, and there was uncertainty as to what should be the correct Community attitude under the Treaty of Rome to its members ratifying the code.
After considerable and lengthy discussions in Brussels, a compromise was arrived at only early this year—this has been going on since 1974. Briefly that compromise accepted the provisions as regards trade with developing countries, but agreed that trade between member-States of the EEC and OECD countries should continue to be allocated on a commercial basis. A Statement to that effect was made in another place by the Secretary of State for Trade on 17th May last.
Whether this compromise would prove
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adequate to maintain the viability of the shipping lines of the great maritime nations, including ourselves, with all their immense in-built investment, or whether indeed it would satisfy the aspirations of the developing countries was a matter for conjecture. At any rate, this compromise had to be ratified last month at the UNCTAD Conference in Manila. As I understand it, the outcome was that there were varying degrees of acceptability expressed by a great number of countries, some abstensions and a few outright objections. In the end, a resolution was agreed without dissent which, so far as I understand it, seems to have the effect of encouraging all concerned, including the developing countries, to get on with arrangements, and instructing the Secretary General of the United Nations to lend advice and help developing countries where called for, and to carry out certain monitoring to see how progress was being made. At any rate, it seems as though the resolution effectively closes the debate for the time being.
So much for that matter. However, before I leave the Manila conference may I say that another resolution on the bulk trades was also passed. That resolution dealt with bulk trades and flags of convenience, but it is quite clear that there was no meeting of minds between the West on the one hand and the rest of the world on the other. I imagine that these subjects will come up again for discussion at the Ninth Session of the UNCTAD Committee on Shipping, which I believe is due to take place in 1980. I hope that other noble Lords will pick up these points. What is significant—and this is the only reason why I say anything about it at all—is that the OECD countries, taking theirlead from the United Kingdom, urged that the present commercial basis for the bulk trades was infinitely better than any form of regulations, but they were outvoted by the rest in an omnibus resolution dealing with this and other matters. What is significant, and really encouraging, is that on this occasion all the West voted as one. I hope that my noble friend the Minister will have something to say on that.
The instance of the West voting together is important and leads me to my next point—namely, that the Western maritime countries must make a concerted approach on a number of matters.

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However, the point that I want to make is one that makes this concerted approach more difficult and it stems from across the Atlantic, from the United States. In the United States shipping policy is, in many respects, quite different from that of other Western maritime nations. These Western nations, and indeed most others, recognise the importance in trading terms of the rationalisation which is provided by the closed conference system. For that reason, for the most part liner conference activities are exempted from the scope of national anti-monopoly legislation. But, on the other hand, when it comes to the United States, the spectre of United States' anti-trust monopoly legislation overhangs all the shipping operations, and American attempts to impose their anti-trust laws on international liner shipping have given rise to jurisdictional disputes between the United States and Governments at the other end of the trade. This has happened on a number of occasions. Considerable efforts were made—and I am very glad that the noble Lord, Lord Goronwy-Roberts, is following me because I am sure that he took part in this and helped it along—by the United States and Western European Governments to achieve some long-term understanding in their mutual trades. Progress was certainly made, but the events which I shall now mention have certainly threatened to set back that progress.
Following Grand Jury investigations in Washington, criminal indictments alleging breach of Section 1 of the Sherman Act were handed down to various shipping lines, including certain United Kingdom lines and United Kingdom nationals. Naturally, this prompted—and I think rightly—our Secretary of State for Trade and the President of the General Council of British Shipping to make very strong statements deploring this action, referring to it as quite prejudicial to any progress in understanding between us. It was unilateral action taken by the United States and does not help Western countries getting together on shipping matters.
In the event, some quite substantial fines were demanded and have been paid. One hopes that this will be the end of the affair, but that remains to be seen. Naturally, one cannot condone the breaking of the laws of another country by one's own nationals, but this surely is a
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different situation. It leaves a sour taste in the mouth and must be a serious setback to objective discussions in the future. However, some modus vivendi between the United States and its European shipping partners must be reached; that is absolutely essential. At a time when we are faced with very difficult world trading conditions, a recession of no mean magnitude, and with the non-commercial activities of Soviet shipping lines, we, in the West, cannot afford to argue among ourselves. It is farcical and tragic; we must work in concert.
That brings me to the point raised in the Twelfth Report about Russian shipping. I use the word "Russian" for short; I should perhaps say the Comecon countries. For the most part Russian shipping lines are not members of liner conferences. As the Twelfth Report admirably points out, they have a rapidly expanding fleet; they seem to have a bottomless purse; they undercut the conference rates substantially and take the cream of the trade. They are doing this to an alarming extent.
Judged on the basis of United Kingdom accounting principles that could be done only at a loss, but I understand that with their accounting approach they can conveniently claim that they are making a profit. Therefore that would exonerate them from the accusation of unfair competition. I have heard it suggested in this country that nations are free to run their own commercial operations and accounting procedures according to their own lights. That sounds logical enough. However, in a complex industrial world where international trade is so important to all of us, some degree of reciprocity is surely needed. In the past various attempts have been made to come to grips with this problem, both on a bilateral basis in the Anglo-Soviet talks in the Black Sea in 1977, and in such international organisations as the Consultative Shipping Group, which comprises Western European countries, Japan, and the OECD.
There has been no reciprocity from Russia and little has been achieved. With the impact growing worse, an attempt was made to discuss this whole question in Brussels in the hope that the collective muscle of the Community might prove to be effective. As the Twelfth Report

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shows, after considerable discussion a very promising suggestion was made. It involved concerted action, first, in the form of fairly widespread monitoring of the routes as to what was happening, which could then be followed, as necessary, by appropriate counter-measures. However, in the event, regrettably that was entirely dropped and all that was left was a very diluted form of monitoring on a minor number of routes. All one can say is that the will to do anything really effective was not there in Europe.
Of course, shipping is more important to some countries than it is to others. Some countries, even maritime countries, may have other reasons for not wanting to antagonise Russia in this instance. They know that Russia is already irritated by the reactions from the West. However, from the United Kingdom's point of view this situation is really serious. I understand that as far back as 1977 the spokesman of the late Government, Mr. Clinton Davis, made it abundantly clear that there could be no further bilateral talks unless the Russians could show some degree of flexibility in their attitude to individual cases. I am told that they have at last agreed to something that may be taken as a feather in the wind. A small degree of flexibility may now be possible in that they have agreed to join the India, Pakistan and Bangladesh Conference on conference terms. Whether or not this is to be seen as a degree of softening up, I do not know.
Last week there was a meeting in London of the Anglo-Soviet Joint Maritime Commission. I do not know what happened at that meeting. Perhaps my noble friend on the Front Bench will be able to tell us. I rather doubt whether anything relevant occurred. Failing that, I shall look with great interest to see what suggestions other noble Lords and noble Lords from both Front Benches have as to how this problem should be tackled. I am afraid that I have spoken for a long time, but this is a very difficult and technical matter. I have tried to build up, in correct logical order, to the point raised in the Twelfth Report. My Lords, I beg to move for Papers.

MPs' AND MINISTERS' SALARIES
3.59 p.m.
Lord SOAMES: My Lords, with the
1124
permission of the House, I shall now make a Statement similar to the one being made in another place by my right honourable friend the Chancellor of the Duchy of Lancaster. The Statement is as follows:
"The Top Salaries Review Body, under the chairmanship of Lord Boyle, submitted to the Prime Minister on 11th June, its Twelfth Report, which deals with the pay of Members of Parliament, Ministers and office holders of the House of Lords, and with certain allowances. The Government are most grateful to Lord Boyle and his colleagues for their thorough review and clear recommendations. The report was published today and copies are available in the Printed Paper Office.
"The Review Body draws attention to the fact that the parliamentary salary has not been brought properly up to date for seven years. They recommend a revised figure of £12,000 with effect from the due date of 13th June 1979. They also recommend that the parliamentary salary of Ministers and other paid office holders who are Members of the House of Commons should be increased from their present level to £7,000. They make a series of detailed recommendations about the pay of Ministers and of office holders, of which the most significant are an increase in the pay of Cabinet Ministers from £14,300 to £25,000, and of Parliamentary Secretaries from £6,050 to £13,000, excluding in both cases the relevant part of their parliamentary salary. The other increases they propose are set out clearly in the report. These increases are large, although this is in part the result of action taken by previous Governments in holding back the recommended rates in earlier reviews.
"The Government accept the sums recommended. However, both sides of the House will recognise that it would be entirely wrong if we in Parliament were to treat ourselves on salaries more favourably than others. We have therefore decided to recommend to your Lordships that the full increases in salaries for Ministers and office holders should not be brought in immediately, but in three equal stages, the first in the present month, the second in June 1980 and the third in June 1981.

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"The Government also propose that the full recommended salary rates should be adopted for pension purposes from the appropriate date this summer. This too follows the treatment agreed for public service groups in recent settlements.
"The Review Body also recommend increases in the secretarial allowance for Members of Parliament from £4,200 to £4,600 as an interim measure, pending a final recommendation in the second part of their report, which is due shortly. They propose increases in the Peers' expenses allowance, together with certain changes in the definition of eligible expenditure, dividing the expenses into three categories instead of the two at present. They propose that Peers who have to stay in London overnight when they attend the House should be able to claim for expenses up to a maximum of £18·50. They also recommend that the present single category of day attendance allowance should consist of two categories. For day subsistence and incidental travel they propose a maximum allowance of £9, and for secretarial costs, postage and certain additional expenses a maximum of £8·50.
"The Government propose that these increases in allowances, including Peers' expenses allowances, should be introduced in full immediately. The Government have asked the Review Body to consider urgently the question of secretarial and other necessary expenses incurred by Ministers and office holders in the House of Lords in the course of their parliamentary duties.
"The Review Body considered how their recommended salaries could be kept up to date. Their view was that, for Members of Parliament and for Ministers alike, the proper course is regular independent review. They recognised, however, the practical advantage of finding a suitable way of keeping the salary of Members of Parliament up to date between reviews and described in detail the comparative advantages and disadvantages of some of the different forms of link which had been suggested to them. This is a difficult issue and there are arguments for and against a link of this
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kind. The Government prefer therefore to reserve judgment until they have had further opportunities to take account of the views of the House of Commons.
"The rates recommended by the Review Body for the Prime Minister and the Lord Chancellor are, as in the past, higher than those for other Cabinet Ministers. The Prime Minister is unable to be in the House of Commons today because she is attending the European Council in Strasbourg. She has authorised me to say that while she and the Lord Chancellor have agreed that the proposed rates are appropriate for their respective offices and should apply after the next election, they have decided not to accept any increase which would put their ministerial salary above the amount recommended for their Cabinet colleagues. Consequently, they will take no increase in ministerial salary until 1981. They have decided to take this course on the clear understanding that all other ministerial increases are accepted, subject only to staging.
"Your Lordships will have an opportunity to consider the Motions necessary to implement these matters so far as they affect this House."
4.5 p.m.
Lord PEART: My Lords, may I thank the noble Lord the Leader for his Statement repeating what has been said in another place. I am glad that our colleagues in another place are going to be helped. But I think it is not the time now to debate any of these issues because colleagues in the House should examine the Boyle Report, which is now available. I think it is absolutely right that Peers' expenses should be raised at this time, particularly those Peers who live out of London and have to stay overnight. I think the nation should understand that years ago the House functioned on a very part-time basis, but it is now increasingly a legislative Assembly. Indeed, now that more senior Ministers in the Government sit in this House, the accountability of Ministers means that the duties of Peers have become much heavier in the past few years. I am glad that action is taken on this.

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I am grateful for what the noble Lord has done and the way he has introduced this. I think that we must pay credit to the noble Lord, Lord Boyle, and his colleagues for their work. It is not long ago that I had the honour to lead an all-party delegation to the Boyle Committee and to discuss with them the problems which have now, I think, been settled. I thank the noble Lord sincerely for his Statement today.
Lord BYERS: My Lords, I should like to endorse everything the noble Lord, Lord Peart, has said in thanking the noble Lord for making this Statement. This is very much an all-party matter affecting Members in all quarters of the House. There is no doubt that an adjustment was long overdue in the rate of the allowances. On a matter of detail, may I ask the noble Lord how he interprets the phrase, "these increases in allowances … should be introduced in full immediately". For the sake of clarification, does that mean from today, or has the noble Lord some other date in mind?
Lord SOAMES: My Lords, might I thank both the noble Lord, Lord Peart, and the noble Lord, Lord Byers, for what they have said, and also say thank you for the part played by noble Lords who, in the interests of the House as a whole, gave evidence, and the noble Baroness who gave a considerable amount of evidence, to the Boyle Committee. It was obviously effective evidence that was given, and it has evidently been taken into full and due account by Lord Boyle and his Committee.
I fully agree with the noble Lord, Lord Peart, when he says that the business of this House has increased considerably. Anyway, the expenses have also increased considerably. I do not think that he should go too far in saying that the fact that there are three Cabinet Ministers in this House makes all that difference, because there was a time when there was a Prime Minister in this House. As to the specific point made by the noble Lord, Lord Byers, I am afraid that the exact date has not been decided. All I can say as a guide is that the last time such a change was made it was done during the month of June, but I am afraid that I cannot give an exact date today.

THE SHIPPING INDUSTRY AND ECC REPORT
4.9 p.m.
Debate resumed.
Lord GORONWY-ROBERTS: My Lords, the House will be grateful to the noble Viscount for introducing this useful debate and for the manner in which he did so. We are also extremely appreciative of the work of the sub-committee—one of the most important sub-committees of the Select Committee on European Policy, the Sub-Committee on Trade and Treaties —for the work they have put in on this extremely important matter. Incidentally, we were glad to have from him a report on the improving health of the chairman of the sub-committee, my noble friend Lord Trevelyan, and I am sure the House will wish the noble Viscount to convey to Lord Trevelyan our general wish that his recovery will be a speedy and full one.
The work of the Select Committee under the able chairmanship of my noble friend Lord Greenwood is already a matter of frequent commendation in this House; it is one of the substantial reasons for the retention of your Lordships' House as a full part of the parliamentary process in our democratic system of due scrutiny. The report is admirable, in that it is brief, concise and comprehensive. Practically everything the noble Viscount said will bear further reading and study when it appears in the Official Report; it was a most able statement of the implications for the future of the matters raised in a report that is commendably brief but very much to the point.
As the noble Viscount reminded us, we in the United Kingdom have the largest shipping fleet in Western Europe. We are fifth—I think he said fourth; we are either fourth or fifth—in the world and we are second in containerised tonnage. Moreover, our fleet is modern, well-equipped and well-managed, and there is a growing consensus of purpose and effort between management and men and between both sides of this considerable industry and the Government of the day. We have a major interest in tackling the undoubted difficulties which have arisen in the field of conference liner operation and various other related shipping matters. We employ 30,000 of our people in this industry and

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we hope to employ more. We carry a great deal of the world's tonnage already and our fleet, in addition to being well managed, is also competitive, and that against a background of increasing competition from outside, particularly from Eastern Europe—from the Comecon countries.
The Soviet merchant fleet is today the sixth largest in the world and this reflects a remarkable expansion over the past 20 years or so. The Soviet fleet has quadrupled since 1960, and this increase reflects the increase in Soviet foreign trade which in turn increased Soviet dependence on foreign shipping which spurred them on to add to their own supply of shipping. The 1970s saw a rapid expansion of Soviet merchant shipping, in fact an addition of some 1 million tons annually, against a background of a general cutback during that period in world ship construction.
The greater part of Soviet cross-trading takes place outside scheduled liner services and their ships have succeeded in capturing considerable trade from certain world shipping conferences. We would not automatically object to that if they succeeded in capturing an increasing amount of trade by fair practices, but there is, to say the least, and there has been for some years, considerable doubt as to whether all Soviet practices in this field constitute fair competition. It is the methods by which the Soviet Union competes which have been causing concern in Western Europe, and particularly in this country. It is principally a question of undercutting rates. Undercutting is supported, for example, by subsidy (these are State trading agencies); by incomplete relevance to commercial costs (here again, the State is omnipotent); by longer amortising periods than are usual in the West (this is an indirect subsidy to say the least); and by the State itself meeting insurance costs and the costs of training crews.
The noble Viscount referred to Eastern European methods of accountancy; some of us are familiar with these in various fields. It is particularly interesting and ominous to meet it in this field because the net result is that they are able, by methods which do not square with Western standards, to increase their
1130
share of trade and, in using the undercutting of rates to do this, force the West, which is already operating to a very economic margin, to reduce its own rates. So we lose both ways: we lose an amount of trade and, on the trade we manage to retain, we manage to retain it only by losing on the lower rates we are forced to charge.
There is another method whereby the Comecon countries, particularly Soviet Russia, achieve an advantage. Their foreign trade organisations—again, they are State trading organisations—buy f.o.b. and sell c.i.f., and that is a great advantage to them. It is said that this concern, which has been mounting in the West and in this country, about rate cutting has been somewhat exaggerated. Perhaps the Minister will tell us when he replies how he sees the present position. I do not believe it is in the least exaggerated. It may have abated in one or two instances in the last year or so—I cannot definitely say—but we should be grateful if, as no doubt he will, the, Minister will give the House his view of the present position.
There have been discussions between Soviet shipping Ministers and ours over the past year or so at least and in the Anglo-Soviet Maritime Commission, which I believe met last week. Perhaps the Minister would tell us if anything has resulted from such bilateral discussions at ministerial, official and commission level.
My next question to the Minister is about the attitude of the Community towards this whole question, and the noble Viscount put it fairly and forthrightly. Indeed, the report puts it very frankly. The committee whose report we are now debating consider that the situation is "most unsatisfactory" as a result of the developing attitude of the Community to these problems. Paragraphs 4 to 8 inclusive of the report give details of the attempts within the Community, principally by the Commission, to set up a system of monitoring of the activities of the Comecon cargo liners.
One cannot escape an impression of disunity, if not of disarray, in the Community on this important matter—indeed, an impression of a certain amount of obstruction in some quarters. It would be invidious to specify countries by name in a suggestion that they have in mind

1131
purposes other than the correction of the situation relating to cargo rates. But one gets the impression from this and other documents that a number of our friends and partners—more than one—in Europe are perhaps more concerned about diplomatic recrimination and commercial repercussion promised in Europe than they are about dealing with a situation which cries out for a united approach by Europe to secure reform.
First, the date of implementing a monitoring system, after being somewhat reluctantly agreed, was postponed. Secondly, there was less than united enthusiasm for preparing counter-measures which could be applied if the results of the monitoring operation showed such measures to be necessary. I should like to know whether in fact the Community is studying what kind of countervailing measures could be applied if the monitoring operation showed that they were necessary. Thirdly, the number of routes to be monitored has been reduced from four to two. In fact, as the report puts it in paragraph 8,
"This most recent Council Decision"—
that refers to, I think, the 23rd November decision—
"represents a further dilution of the Commission's original proposals. The provision for concerted counter-measures has been dropped,"—
I asked whether studies were proceeding. They may be, but the reports says that they have been dropped—
"and the geographical scope of monitoring is much reduced"—
it is reduced from four to two—
"As such, the Decision is a disappointment to the United Kingdom".
I would draw the attention of the House to what the report further says; namely that our Department of Trade submitted a note on the Council's Decision of 23rd November, stating that the United Kingdom
"requested an entry in the Council Minutes to the effect that the study of possible counter-measures, commissioned by the Council in June 1978, should proceed forthwith so that measures could be adopted if need were established".
Perhaps the Minister can tell us how far we have got with this very reasonable request: that while monitoring is established, albeit for a reduced number of routes, nevertheless the necessary and
1132
useful study of the kind of countervailing measures that might prove to be necessary should proceed regardless.
Finally, may I invite the Minister to tell the House what steps Her Majesty's Government intend to take to raise these matters and press them forward in the Council of Ministers. I recall that last year in the other place there was a short debate on this matter in which the then Government was represented by my honourable friend Mr. Clinton Davis. to whom the noble Viscount paid a well merited tribute for his work in this field. He, and the Government with him, were accused of dragging their feet in this matter and not showing a robust enough belief in the rights of this country. Well, now those accusers have their chance. The then Opposition is the now Government, and no one would be more delighted than I and my noble friends if the Minister is able to tell me that on commercial grounds, and possibly on strategic grounds too, the British voice on this matter will be raised loud and clear in the Community. Although there are certain reservations among our friends in Europe on various aspects of the matter, I believe that if our voice is maintained, and is raised clearly enough, we shall have very substantial support in Europe for the proposals that we have already made.
4.26 p.m.
Viscount SIMON: My Lords, when I first came to your Lordships' House we used to have quite frequent debates on the shipping industry, many of them initiated by the noble Lord, Lord Winster, whom older Members of your Lordships' House may remember as being very keen on anything concerned with our Merchant Navy. Recently we have not had the opportunity to discuss these matters, even though the position of our shipping industry is very much graver today than it was 20 years ago; and so we are all most grateful to the noble Viscount for having both tabled the Motion and introduced it to us with so full-ranging a speech. I am also very grateful to the noble Lord, Lord Goronwy-Roberts, for what he has said, particularly regarding the international situation. It makes it almost unnecessary for me to say anything about the report which is referred to in the Motion before us.
I agree entirely with what both the noble

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Viscount and the noble Lord said. The report shows that for some reason the Council of Ministers is very half-hearted about a matter which has been strongly urged upon the Community through the Commission. I venture to think—and I suspect that the noble Viscount also hinted this—that this is perhaps because although most of our partners in the Community, with the exception of Luxembourg, have substantial shipping interests, in none of them is their shipping interest so vital to the economy of the country as is our shipping interest to us. This has made the Council of Ministers, or clearly some members of it, unwilling to pursue the line which the shipping industry has asked for and which the Commission has suggested.
There is only one point about the report that I should like to add to what the noble Lord, Lord Goronwy-Roberts, said. As he rightly pointed out, the scope of the monitoring has been greatly reduced, but I regard as even more unfortunate the attitude in regard to countervailing measures. Is it really sensible to postpone as the Council of Ministers seem to wish to do, the preparation of countervailing measures—which will clearly take time to prepare—until we have had the result of the monitoring? If the result shows that serious damage is being done to British and other Community interests, which is what current experience shows practical people, are we then to have to wait another year or two while measures are being prepared and put into effect? Fortunately, as a result of the Merchant Shipping Act of earlier this year, our Government have the power to take countervailing measures when the occasion arises.
If this is to be done on a Community basis, clearly everybody must agree first on what has to be done. Countervailing measures are only a type of warfare and I think that it is open to question how far they are going to get us. They could lead possibly to repercussions in other directions. I must say that I was very satisfied to read in the speech of the new President of the General Council of British Shipping that in his inaugural address, when dealing with this matter, he used these words:
"We have the hope that one of these days it may prove possible, against a background of
1134
strength, for some understanding to be reached with the Soviet Union on shipping questions".
If that can be done, it is a far more satisfactory arrangement than having a guerrilla war with counter-measures and Heaven knows what other action taken by the other parties.
If I may turn to some of the wider issues, the economic problems facing the industry, apart from those arising from these Comecon activities, are very serious. We have over-tonnaging throughout the world; there is too much tonnage, I would suggest, even if trade were buoyant. We have the extension of the developing countries' fleets, some of which are more for prestige reasons than economic reasons. But on that point, we must understand their position. Those of your Lordships who were connected, as I was, with shipping during the last war will know that many of these small areas, then largely colonies of the different great powers, depended for their livelihood on being serviced by ships of other nations and particularly by the British fleet. When the whole fleet had to be requisitioned for the purposes of the war, they suffered seriously. I can understand, to take the example of our own colonies, their saying, on achieving independence, "Should another war arise in which the great powers are involved, we must not be entirely reliant upon them for the supplies that we need to maintain life in our own territories". I think that we should take an understandable and understanding attitude towards these moves by the developing countries.
Then we have the oil crises, and particularly the latest oil crisis arising from events in Iran and the expectation that this may lead to a further trade crisis. Shipping has always been a cyclical business, but a cyclical business does not, unfortunately, follow the geometrical circle. I am afraid it looks as though in this case, having reached the bottom of the circle, it is going to be a long time before it starts the up turn. That, at any rate, is how it seems to me. But I am glad to see that the noble Earl, Lord lnchcape, and the noble Lord, Lord Inverforth, arc going to speak later. They have in these matters much greater knowledge than I. To me, the prospect seems extremely gloomy.

1135
My Lords, I should like to say something now about the men, and a few women, too, who man our ships. I hope that I shall be forgiven by noble Baronesses if I use the verb, "man"; for I do not feel that one can say, "who 'person' our ships". Having spent nearly 35 years in the shipping industry, though it was a long time ago, I have been privileged to know personally and to appreciate the sterling qualities of our seafarers. We often remind ourselves that we are by geographical necessity a seafaring nation. I do not know whether these qualities which make our seamen the finest in the world are inherited or whether they are acquired afresh in each generation; but certainly these qualities survive. Of course, the increasing complexity of modern ships demands of seafarers qualifications which were not necessary in the old days. The job is quite different; the work is less hard physically than it used to be. This, curiously enough, introduces a new problem: for if men are not now as exhausted physically at the end of their watch, their period of duty, it is easier for boredom to creep in during the off-duty hours, living as they must be, and are, in rather cramped conditions and in small, closely-knit communities. Moreover, as life ashore has become increasingly easy and pleasant —and let us be frank, whatever criticism we have of successive Governments. life has grown easier and more pleasant than it used to be; and even the curse of unemployment which we discussed yesterday is made easier to bear than it used to be—so the particular disadvantages of life at sea, the absence from home, sometimes for long periods, sometimes for indeterminate periods, becomes harder to bear. And it is harder to bear not only for the seafarers but for their families as well.
What has the industry done about this? I should like to take your Lordships hack about 60 years, to just after the First World War, when the industry in consultation with the trade unions concerned set up the National Maritime Board. And before any noble Lord on the Benches opposite starts to get hot under the collar, this is not a Quango. It is called the National Maritime Board because it was a board which dealt on a national basis with the relations between employers and employed in the shipping industry, but there was no Government repre-
1136
sentative on it. Within the ambit of this board, wage negotiations were carried on, but also there were full and frank discussions across the table, or, rather, round the table, because at the only meeting that I attended we all sat round the table and not facing each other across the table. All the problems of the industry were tackled in a co-operative spirit between the employers and the unions.
It is so long ago that I cannot remember and give credit to the man on the side of the employers who started this idea, but I remember that great leader of the National Union of Seamen, Havelock Wilson, who had a great deal to do with the establishment of this body. It worked marvellously. There was real understanding and really frank discussion. The only one sad result was that, in a sense, the owners and the unions got so close together, because they understood each other's point of view so well, that it was possible for Mr. Harold Wilson, as he then was, during the seamen's strike in 1966, to accuse the owners of having put the unions in their pockets. This was a very unfair criticism. What had happened was what we all would wish to happen in more industries: that the two sides (if you have to call them two sides) were recognising that they were really part of the same organisation and that they could discuss frankly what the problems were and how best to solve them in the interests of the industry.
This general concept has been developed since then. Recently, I have been interested to learn about a body under the chairmanship of a very old friend, Sir Frederick Bolton, a body representing the owners and the unions—on this occasion with the help of a representative of the Department of Trade—who have been continuously examining and exploring all the kinds of problems which arise in the rapidly changing conditions of a developing industry. The terms of reference of this body interested me very much. I am glad to say they are quite short. They are as follows:
"To examine ways in which life at sea in the United Kingdom shipping industry can be made more attractive to the United Kingdom seafarer from which the effective use of manpower can be developed".
I thought that was a splendid term of reference. This body has been working for about five years and now it is about to wind up its work. To follow that,

1137
there are proposals for a similar body working in the same direction. I believe these matters are being considered this week, and it may be that the noble Earl, Lord Inchcape, will be able to tell us something about that.
This is an indication of a state of relationship in this industry which is much to be admired, one which justifies the industry in the hope that it will get through whatever difficulties there are. I believe that, if the present Government take up the problem—as they must in the next five years; and the sooner they do it the better—of the question that was left by the Bullock Report, which I am afraid most of us on all sides of the House did not like very much, and deal with how we are going to spread what I still like to call "worker participation" (because I dislike the phrase "industrial democracy"), and spread that spirit through all the industries in this country, that will do far more to improve the efficiency of industry in this country than tax relief.
Finally, I want to say just a few words about what the Merchant Navy has done for us. Some of us—perhaps most of us here—have lived through two World Wars, in each of which we were saved by the skin of our teeth by the Merchant Navy. The courage of the men who brought what was needed to our beleaguered island and to the theatres of war is something which should be more frequently remembered. If any noble Lord wants to remember it, he can go down to Tower Hill and look at that splendid war memorial with the names of thousands of sailors upon it.
We must all hope and pray—those of us who can pray—that our country will be spared another war. If by any unfortunate chance that does happen, the men will be as courageous as they were in the last war. I remember being told that in those terrible Russian convoys going around the North Cape—one of the most dangerous routes in the world during the war, with the German aeroplanes in Norway—no ship ever missed a convoy because the crew were not there. That spirit will be repeated again. The question I ask the Government—and I hope that the Minister may be able to give us some reassurance—is this: does he and do the Government realise the immense importance of ensuring that,
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if such an occasion does arise, we shall not only have the men but we shall have the ships?
My Lords, before I sit down, may I say 1 am sorry that I have to apologise to the House and also to the noble Viscount and the noble Lord, Lord Trefgarne, that I may not be able to stay to the end of this debate on account of a previous commitment. I have never had to do this before and I am extremely sorry to do it on this occasion.
4.44 p.m.
The MINISTER of STATE DEPARTMENT of INDUSTRY, (Viscount Trenchard): My Lords, the House indeed owes a debt of gratitude to my noble friend Lord Rochdale for moving the Motion and the way in which he moved it. The House also owes a debt of gratitude for Lord Rochdale's part in the Twelfth Report and of course for all his very distinguished background services in this area, and particularly that "Bible", his 1970 Committee of Inquiry Report. Let me add my thanks to those which he expressed to the noble Lord, Lord Trevelyan, and other members of the committee and say, as others have said, that we wish Lord Trevelyan a very speedy recovery.
I have to add an apology that I shall not be able to stay to the end of the debate. My reason is that I find ministerial "pull" to get night sleepers is not adequate to enable me to get to the South West on a regional visit—the third of my regional visits—which has to be fitted in a very tight timetable. I shall stay for as long as I am able, but my noble friend Lord Trefgarne will wind up the debate. I believe he is decidedly more knowledgeable than I am. I know that there must be a limit to the number of times that I am able to get away with apologising for this, being the first time that I have stood here doing something for another department. On this occasion I have to answer on a subject which is the responsibility of another department. I see the noble Lord, Lord Goronwy-Roberts, smiling as he recognises the signs that experience is growing of the problems that that produces.
My knowledge is very small in the shipping world, and perhaps the House will not take it amiss if I were to say that

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really the only serious tuition I had was in my very early training days in Unilever in their shipping department, when a manager of a department—who was not the most enlivening of lecturers—was going on and on about a bill of lading. I found myself with a pencil writing a poem. I cannot remember it all, but I can remember the last stanza:
"No matter where your trading;
It has to go by boat;
While on the bill of lading;
The steamships stay afloat".
My Lords, I have listened with very great interest to the speeches made by the noble Lords who have preceded me, and particularly to that of my noble friend Lord Rochdale, with his immense knowledge. I am also aware, in addition to commenting that the Twelfth Report is, as he says, an excellent document—and we have taken note of it very carefully—that the Merchant Shipping Bill went through this House at a very fast speed just before the dissolution of Parliament, and that there may well be points that noble Lords had been meaning to raise in the debates on that Bill which may come out in this debate. Those points, along with all the points in this debate, will be most carefully drawn to the attention of my honourable friend, the Minister of State at the Department of Trade.
I shall concentrate on the problems of our industry in the international context. I shall touch a little on the domestic situation, but only briefly. It goes without saying that I agree that shipping is a uniquely international industry and the current problems of the industry stem from many of our international problems. As a newcomer, I put the problem slightly differently, and maybe it is just my lack of education. The word, "recession" is used a great deal in this context. The whole of world industry is having a difficult time. But of course it is not strictly true that trade by ships has gone back, which could be implied from the word "recession". It is still growing at 4 per cent. per annum.
While all the world's shipping lines are undoubtedly feeling the pinch in regard to profitability, it is regrettably true that our own industry has, to a greater degree than most, lost a share of the market. Of course this situation, whatever name we
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use for it, comes from the continued building of ships, albeit at a slower rate than some years ago, at a faster rate than the building up of world trade and the need to carry cargoes.
The level of world trade itself is, of course, terribly important to us and, as is well known, we are more dependent on it than most. Until now, as noble Lords have said, the Free World has been generally served well by its shipping industries; and with the tradition of free and vigorous competition, albeit with a degree of voluntary self-regulation via these conferences, of which my noble friend Lord Rochdale spoke, this vigorous, competitive industry with its self-regulatory element has provided efficient services.
The changed conditions which I have just outlined have produced, as my noble friend said, severe price competition. They were bound to do so. If supply is increasing faster than demand this is the inevitable result, and it has produced to a degree the calls for protectionism and for Governments interfering in shipping. It is well known, of course, that virtually all our exports go by sea and that United Kingdom lines are still the largest single factor in that area. It has been mentioned that the United Kingdom's fleet is still the fourth largest in the world. It has also been mentioned that we continue to do relatively well in the liner sector and in fact are leaders still in two sectors, and very close behind in two others. I accept entirely what my noble friend Lord Rochdale has said: that this is due to heavy investment, wise investment, and efficient investment by the industry. The figure that I have is £4,500 million over 10 years, which incidentally is 15 per cent. of the investment in Great British industry as a whole. I also accept all that has been said about the record of the industry on all sides, and there seems no point in my repeating that.
It is, therefore, in that context, rather sad that we have lost our share, and sad also to record, as I am informed—and here I am informed slightly differently, I think, from my noble friend—that the balance of payments contribution from shipping has now moved from being a small positive one to a negative one. This is in terms of the amount of shipping that United Kingdom residents provide, compared with the amount of shipping we have

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to buy from operators in other countries. I understand that in 1978 it moved to a minus contribution to our overall balance of payments of £300 million. This is indeed very sad, and I can assure your Lordships that the Government are very aware of this sitution and are studying it very carefully.
My noble friend has given a much more effective and comprehensive review of the problems that I can hope to do, although I will tell him as I go along what I believe my right honourable friend feels on these subjects; but before coming to the detailed problems I want really to say first that it is still early days in the period of office of this Administration. Paying attention to a very knotty problem is one thing: getting to the stage of being able to give specific answers, as all your Lordships will know, is another.
I think the first thing we want to say is that while we would like to see world trade speed up, and indeed we hope that it will do so, we are not counting on the fact that it will. In cautiousness and commonsense, I think we have to assume that the growth of trade by sea will not accelerate very much. Within that context, we shall do everything we possibly can to ensure that our shipping industry is given a fair trading opportunity. The noble Lords who have spoken already have covered a great number of points which show only too clearly how difficult of accomplishment that is, but it is certainly our determination so to do. We are very aware—and I shall return to this later—of the problems of lower-priced competition, but we separate them mentally from the problems of aided competition. We believe, in relation to the latter, that we must work in concert with other nations. We accept that flags of preference generally are not the most effective way of ensuring a competitive and efficient shipping industry, but we do recognise the developing countries' point of view, which the noble Viscount, Lord Simon, mentioned—although we sometimes wonder whether they are wise in some of the attitudes they have taken.
I want to introduce at this point the industry's attitude, as I understand it, on this very difficult situation, and to say on behalf of my right honourable friend that he found their attitude and their recent statements, bearing in mind all that they
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are facing, which has been outlined, a thoroughly healthy one. This is not an industry which is rushing, cap in hand, asking for help: it is a sturdy, independent industry. The first paragraph of a statement recently released by Mr. David Ropner, the new President of the General Council of British Shipping, says:
"The most crucial challenge for British shipping in the coming year would be to maintain its competitive edge and at least equal its competitors in cost-effective manning operations".
My noble friend Lord Trefgarne will touch on the domestic points later but this industry, faced with these problems, is doing all it can to improve its own efficiency. The importance of it and the size of it have been already sketched, and I will not go over these statistics again. The tonnage of ships that have been laid up, taken out of service or sold has also been mentioned. These figures are serious, and we know that some of the latest sales have been of good modern ships. The profit position and the cash-flow position of the industry are known and the steps taken by the last Government to alleviate them are acknowledged in the short term. However, what we and, I believe the industry, want is a free and healthy industry and one that has a fair trading opportunity.
That takes me to the international problems. If I may, I should like to leave the very important points that the noble Lord, Lord Goronwy-Roberts, raised on the EEC until I have dealt with two of the subject headings here, but I shall come to some of them later. May I first comment on the UN liner code convention. I understand that the convention was adopted as long ago as 1974. It largely reflected the aspirations of developing countries in liner shipping and, in particular, contained the rigid provisions to which my noble friend referred on cargo shipping—the 40/40/20 per cent. suggestions. We recognise that successive United Kingdom Governments have been aware of the problems of developing countries, and we, too, are also aware of them. I think that all Governments have believed it totally inappropriate that the provisions designed to meet developing countries' needs should be applied to all shipping, including shipping serving trades between industrialised countries.
There is no reason to depart within the OECD area from the present free com-

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mercial régime, which serves both shippers and shipowners well. However, it is clear that in current conditions some OECD countries have become attracted by the protectionist elements in the code. The United Kingdom industry, as we know, has vigorously opposed this trend, and has done its utmost to maintain the free commercial regime which suits its worldwide shipping activities. In 1974, we expressed this attitude by voting against the convention.
However, as is well known, the European Community had come to a common position on the code. That position was finally agreed last month. The regulation in which this agreement is included represents, in our view, an important step both in the development of a European shipping policy, and in laying the basis of shipping relations between developed and developing worlds.
The United Kingdom stressed throughout these difficult negotiations the importance we attach to maintaining a free commercial regime within the OECD and between OECD shipping lines, and the dangers of a protectionist solution based on the code without any amendment. The final position adopted by the Community has been outlined, but the principles of it are, I think, clear; developing countries will enjoy the benefits of the code in their own trades; the code's most rigid features, notably cargo sharing will not be applied—my brief says "will be disapplied", but I prefer a different phrase—in intra-OECD trades, provided that other OECD countries adhering to the code offer reciprocity; competition will be encouraged between OECD lines in their share of trades with developing countries.
The maintenance of the present commercial régime within the OECD now depends largely on the response of the other OECD countries. We agree that the question of Western unity is critical. In this case, we believe that the Community has given an important lead and one that is based firmly on the fundamental free trading principles of the Western world. Some other OECD countries have already made it clear that they will follow the Community's approach. We welcome this and we hope very much that others will follow. United Kingdom accession
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to the convention will require legislation. Of course, the code must inevitably mean some changes in the operation of liner conferences, but we are confident that, in essence, the system will go on as before.
Let me now come—still before commenting on Europe—to the problem of Soviet Union shipping and Comecon shipping. Of course, the problem that is probably worrying the industry more than anything else is non-commercial competition from the Soviet Union in the liner trades. We accept that there has been what I think my noble friend called "cream skimming". It may be that later in the debate, and possibly after I have gone, the Department of Trade's internal report may be mentioned, because I understand that noble Lords taking part in the debate know of it. But I want to assure the House that my noble friend does not in the smallest degree underestimate the seriousness of this threat.
The Soviet fleet has grown enormously. Various statistics have already been given. It has doubled since 1970. Its predatory rate-cutting outside conferences has enabled it to win business from established conference operators, or to force conferences to cut rates and dilute their revenues as the price of retaining shipping. Because of the importance of the Soviet Union, this is clearly a problem that is best handled by nations in concert. The crucial need is to achieve sufficient Western unity and, as has been mentioned, the United Kingdom has made valuable initiatives in the European Community. We still have to establish the basis for a co-ordinated Western response to damaging Soviet practices. We would clearly prefer a policy of accommodation rather than confrontation and there are signs, as has been mentioned by my noble friend, that the USSR's attitude may be changing. We hope that those signs are indeed real.
I come to the points that the noble Lord, Lord Goronwy-Roberts, raised, and to his plea that the British voice should be heard loud and clear calling for effective action on an EEC basis. There is no question about the strength of British views on this point. I think that we have a great deal to do in the EEC generally, but we are not perhaps so convinced as the previous Administration that "loud" is the right word to use in this context.

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Effective action must be taken and we believe that the EEC can become a great help in this area. I have noted carefully what the noble Lord and others have said about diluting and delay—even about the monitoring exercise and not working on the possibility of countermeasures. I think that all I can do at this stage is to assure the noble Lord that this Administration is working on all those subjects, that it has opened discussions behind the scenes—and that is why I said I believed that in these areas negotiations are often more effective when they are not loud—and we shall press them as fast as possible within the context of overall EEC problems.
Nothing very spectacular came out of the tenth meeting of the Joint British/ Soviet Maritime Commission last week, but we welcomed the fact that they had joined this one conference and that they seemed more ready to talk about these things. I believe that the EEC can be a positive help. I accept what has been said about the fact that we have a much bigger shipping interest than the other members of the Community. In this context, I want to remind noble Lords that Greece will shortly enter the Community. As I understand it, when Greece enters she will hold a larger share than we shall of the shipping trade, and thus there will be two nations who are really interested in world-wide shipping. This should be a great help in ensuring that a positive view is taken by the EEC. However, we believe that the negative views of the past were perhaps influenced by other things. We hope that the positive attitudes of this Administration towards the EEC will produce the correct response.
It is much to be regretted that shipping relations with the USA are such a problem. The position has been well spelled out by my noble friends. Therefore, the only thing I shall do will be to repeat the statement on 1st June of my right honourable friend the Secretary of State for Trade, when he expressed grave concern about the situation. He said:
"Shipping is an international activity. It affects the interests of both countries. Any questions that arise should be dealt with jointly, and we consider it wrong in principle for the United States to exercise unilateral control over shipping between the two countries in disregard both of our economic interests and of our shipping policies. In the light of this latest development, the United Kingdom will be reviewing its attitude
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towards co-operation with the United States in anti-trust questions and on the enforcement in the United Kingdom of United States anti-trust judgments. Meanwhile, I hope it will be possible for the case to be settled as soon as possible. For the future, the United Kingdom looks to the United States to adopt a flexible and responsive approach to further discussions, with a view to reaching a long term agreement between us on shipping matters".
I shall overstay my welcome if I spend any length of time on UNCTAD. I endorse the remarks which were made by my noble friend Lord Rochdale in that respect. We believe that we shall keep trade in the OECD countries on a competitive and open basis, and we shall resist the demand for a cargo sharing régime in the bulk trades. We are aware of the industry's views on all the unfair competition questions which have been mentioned, and I should only be repeating what other noble Lords have said. We shall work as hard as we can to try to ensure a fair trading opportunity.
We are very heartened by the attitude and resilience of the industry. We are also very heartened by the fact that industry discussions are taking place, as the noble Viscount, Lord Simon, mentioned, among all those who are working in the industry to try to ensure a yet more efficient performance. Also, we are aware of the defence needs in relation to the security of this country. I am still a novice who has taken too long, and I apologise to the House.
5.13 p.m.
Lord HAYTER: My Lords, I, like other noble Lords, am very grateful to the noble Viscount, Lord Rochdale, for introducing this debate. So far, it has reminded me of Mark Twain's observation that everyone talks about the weather but nobody does anything about it. In this context, one asks the question: who does the talking? I noticed in a newspaper this morning that in one year the General Council of British Shipping held 1,200 meetings in their building. But what happened? Who listened? I do not think anybody did. And who acts in the context of what we are talking about today? To be truthful, it must be those nations who are not too mixed up with other nations—and that means Russia, China and the USA—and who do not get themselves too involved with allies who may not always agree with

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everything that they say. So I have been very depressed by the debate so far, but I hope that I shall cheer up.
There has been an air of euphoria about the debate which I do not think is realistic. However, noble Lords may well ask why I should have any cause for criticism. The answer is very simple. For some time now I have been the chairman of a little Neddy, that of the International Freight Movement. We have been hammering away at this issue for the last two years or so, with a minor result, as has been mentioned. The General Council of British Shipping and the unions have been intimately involved, and I hope that good will come from it. A variety of opinion is to be found on this little Neddy. The Government are represented upon it; so are the unions, and also the employers. More important, however—and he has not been mentioned a great deal so far—the customer is represented. On this little Neddy we have the British Shippers' Council, the CBI and the British Importers' Federation.
Unless we can solve this problem, my position in the little Neddy group will be very difficult. For is there not, in the National Economic Development Council, the theory of an industrial strategy? Are we not trying to put forward the idea that all of these working sectors should be increasing their exports? And how can they do that if they do not have the shipping which is right for them and which brings its share of payments into this country?
Although United Kingdom shipping, as has already been mentioned, ranks as the most efficient in the world, this is of limited avail if we meet subsidised foreign competition—or, should I say, foreign competition which is more subsidised than ours. It is good business practice to sell cif rather than fob, but if this means that the shipper does not have the facilities that he needs it leads us nowhere.
Now we come to the balance of payments question which has been mentioned. The same is true there. If, for any reason, our shippers can transport exports from this country only on terms less advantageous than those available from overseas, this is self-defeating in balance of payments terms.
On the question of the future prospects
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for the industry and looking at them from an abstract point of view, these to me remain very gloomy. I do not wish to rehearse once again all the problems; they are self-evident. It is the solutions which are so hard to find. The international aspect of shipping and the oil crisis brought their problems, with freight rates being pushed down and United Kingdom shipowners having to pare down their operations and sell their ships cheaply to their competitors. Most people will agree that since the great days of United Kingdom shipping supremacy Britannia no longer rules the waves. Several countries are determined to bring about a reverse and to build up their merchant fleets.
I take the point which was made by the Minister, the noble Viscount, Lord Trenchard, about the entry of Greece into the Common Market. If I may add a word of caution, this might not necessarily be to our advantage. We shall have to be a little more thoughtful as Greece, Spain and Portugal join these other people, whose permission we have to seek before we can carry on our own strategy.
Then other countries subsidise their freight rates, as we now know to our cost. They reserve cargoes for their own fleets. They create shipping fleets out of all proportion to their operations. This is an element of competition. It is one thing to recognise the competition and another thing to fight it with all the strength at one's command. One more factor which has to be taken into account is the mad scramble to build new ships in the 1960s and 1970s and the surplus capacity which then became available at knock-down prices to nations expanding their fleets.
The last point I have made a note of to which reference has already been made, relates to flags of convenience, a situation which, to a businessman, is quite extraordinary. It cannot be paralleled in any other industry in the world. If you have a flag of convenience, it entitles you to make up your own rules as to how you are going to conduct competition. If we are talking about long-term strategy—and I take it that we are—we ought to be much more precise about the nature of the competition, and that brings us back to the reference to monitoring, a point which has already been discussed in this

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debate. But unless we really can establish the potential growth of this industry we have some other serious problems.
It follows from the fact that we do not know where we shall be standing in 10 years' time in relation to shipping, that we also do not know how many training courses should be settled for our union representatives; the schools, the hospitals, the hotels, the recreation centres and the other union services again cannot be forecast. The time has come for an international system of educational support for marine qualifications. This was referred to by the noble Viscount, Lord Simon, and I entirely agree with him. The work in shipping has changed, and although some efforts have been made in this connection in the past, I personally feel ashamed when I hear what is happening in Rotterdam and elsewhere on the Continent in relation to the educational needs of their seafarers. The public are quite right in asking for an increase in standards, and if those standards cannot be supported by the sale of the shipping and of their services I think the industry is entitled to get some financial support. The same is true of safety standards and environment control techniques. One could argue that the Government should promote international safety standards and implement them in the United Kingdom and that if they affect the cost of shipping then the industry can turn round to the Government and ask for help.
With our EEC partners of course, as has been said today, we can press these countries to permit the same shore and commercial facilities for EEC shipping as we permit to them. It is a tragedy that a solution to that particular problem cannot be arrived at, but in a very short time will come the opportunity in connection with the Rhine/Danube problems when I hope that a stand can be made.
So the four aims that my little Neddy has in relation to shipping are very simple. We want our exporters and our importers —because they must not be forgotten—to have the most economical shipping services possible, but it must be on a continuing basis. We must avoid putting ourselves into a situation where, by our traders taking short-term advantage of cut price subsidised shipping they therefore kill off the non-subsidised shipping in this
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country, and we should later be faced with a shipping monopoly which we know we shall have to pay for through the nose. Secondly, I endorse entirely what the noble Viscount, Lord Simon, said: we must ensure that we have protection for our essential seaboard trade against a time of war or of a trade war, when international shipping is seriously disrupted. That is a major strategic point. Thirdly, so long as international shipping provides scope for worthwhile employment to our seafarers and ship managers naturally we want to have as large a share as possible of the international shipping business. Fourthly, there is the obvious point that we must play as strong a role as possible in ensuring safety at sea.
I would proffer two solutions—a major one and a comparatively minor one. The major one is that I would suggest that it is the role of Government to get established the basic level of UK shipping and seafaring. There must be a minimum number of ships that we should have against trade war or against any other kind of more serious warfare. That is a matter of judgment for the Government, and when we have made up our mind as to the basic level—and of course it carries implications that if it is the basic level of shipping, it is the basic number of seafarers, the basic number of seafarers' facilities—if we are forced down to that position, then the Government must maintain it by whatever form of protection is practicable. In just the same way as facing up to competition in business, when you are really up against it you have to be ruthless, so the Government will have to be ruthless, having established that minimum basic level.
The other small contribution that I should like to make is to say that if there is any opportunity which the Government or the other interests involved feel that my little Neddy can do, of course we shall be only too delighted. One of the curiosities of my little Neddy is that it gets things done. At Heathrow it was our little Neddy which put forward the great bonded facility which made so much difference to the freight forwarders, and if in the context of the Rhine/Danube connection we can help in any way at all to solve some of the problems, I should like that to be suggested to us. Whatever is said by the various interests represented in this debate, there are not many ways in which one can go. We could have a commission of

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inquiry, but we know what the time factor for that would be. We could leave it to the individual organisations, and that is exactly what has been happening all this time. The only other solution is to get together a body where all the interests can be brought together with a firm recommendation represented by the interests concerned, as to what the basic level is that must be maintained in a very difficult area from a national and also from an industrial point of view.
5.27 p.m.
Lord CAMPBELL of CROY: My Lords, I am glad to be following the noble Lord, Lord Hayter, in this debate. As we have heard, he is the chairman of the international freight sector unit of the National Economic Development Council organisation and therefore has been running one of the "little Neddys", as they are known. From all that I have heard of it, that body certainly has the reputation for getting things done, and I am sure he is largely responsible for that success. But I think I detected a complaint from him that there has been an air of euphoria in the debate so far. I shall certainly not contribute to that. He referred to a saying of Mark Twain, that everybody talks about the weather but no one does anything about it. That prompted me to think of another saying attributed to the same author, that a certain piece of music was "better than it sounded". I hope that the departments and all others concerned will examine carefully the contributions that are being made to this debate today when they read them in the Official Report, because I think they will find nuggets of good sense and good advice in the speeches.
Like others, I congratulate my noble friend Lord Rochdale on having initiated this debate and on having done so in such a helpful way. He dealt with a complicated subject in what he described as a logical sequence and it is a very well chosen sequence. Subsequent speakers have been able to avail themselves of his sensible division of this subject, as I intend to do myself. Of course the Motion was down for debate in April and it was postponed as a result of the dissolution of Parliament. I am very glad that it was only a postponement and not a cancellation. One result of the general election that intervened is
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that most of us are speaking today from places in the House different from these which we would have occupied had the debate taken place in April. I hope I shall escape any risk of accusations of introducing polemics into the debate by saying that I regard the new positions in the House as an agreeable change.
Parliament is greatly indebted to my noble friend Lord Rochdale, I think more than has yet been stated in this debate for his contribution in past years to this and to related subjects. He was too modest about this. After having done that exhausting inquiry into docks and harbours he was, between 1967 and 1970, chairman of the Committee of Inquiry into shipping. It examined the whole question of liner conferences, both open and closed, their usefulness and whether they cause restraint upon trade and upon competition. As a result, the committee approved in general such conferences, but did make some reservations. Those conclusions were accepted, and modifications were introduced at the initiative of the British; the British took the lead. As a result the modifications have been adopted by a very large number of the liner conferences throughout the world, notably in the CENSA code, as it is called. I will spell the name of that out, because it arises from the Council of European and Japanese National Shipowners' Associations. The point is that there is no "J" which can be sounded in the acronym, but it is important to recognise that the Japanese are involved. It was as a direct result, therefore, of my noble friend's committee's report that the liner conferences have been operating throughout the world very smoothly until 1974, when the United Nations code of conduct was adopted. The liner conferences situation would not otherwise have been disturbed.
But, as has been already stated, it was the developing countries who found that CENSA code not to their liking. Britain voted against the United Nations code, but Japan, for example, appears to be in favour of it. Indeed, the unity of the maritime developed countries has been upset by this new code, and therefore I very much welcome the agreement which my noble friend Lord Trenchard confirmed just now had been agreed last month among members of the European Economic Community. I understand that ratification of the United Nations code

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can be carried out by members of the Community with agreed reservations. That United Nations code was very hurriedly thrown together, and, as the Twenty-Fifth Report of the Select Committee in the Session 1977–78 pointed out, it had great disadvantages for the United Kingdom. Now the agreement reached within the EEC goes forward for discussion in the OECD. Very much is owed to my noble friend for these developments and the way that this is now going.
I would also like to join others in mentioning Sub-Committee B of the Select Committee and express regret that its chairman, the noble Lord, Lord Trevelyan, cannot be with us because of illness. I join others in hoping that he will have a very quick recovery after being in hospital and having his operations. I cannot refrain from mentioning that we worked together for the first time 32 years ago, when he was in the Economic Relations Department of the Foreign Office and I was working in one of the European departments; so I particularly look forward to further working with him in the future.
Turning to the state of the British shipping industry, I am to be followed in the debate by two noble Lords who are themselves in the industry and will give us the benefit of their knowledge, my noble friends Lord Inchcape and Lord Inverforth. So I will not go into those particulars myself. We all agree that the industry has been passing through a very difficult period and we are glad to see some signs of improvement in recent months. But there has been a substantial reduction in British-owned ships during the past year. The statistics for 1978 are available, and for that year certainly the United Kingdom is shown as fourth in the world table in deadweight tonnage. The noble Lord, Lord Goronwy-Roberts, said that he thought we might be fourth or fifth, but certainly in 1978 we were fourth.
Two of the countries who are ahead of us are Liberia and Greece. If we look closely at the registration of ownership, where Britain is concerned we find that the tonnage registered with the United Kingdom is 49·7 million tonnes. That owned in, and registered with, the United Kingdom is 46·7 million tonnes. So there is not a great difference between the
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tonnage registered and the tonnage owned by United Kingdom owners. That means that we are virtually with Japan at the top of the first division in the first league in the shipping of the world, because certainly where Liberia is concerned I think we can assume that considerably less of the tonnage which is registered with that country is genuinely Liberian in ownership.
My Lords, not only in size is the British industry in such a leading position in the world; we lead also in specialised cargo fleets, such as container shipping and other carriers. I think the importance of the United Kingdom shipping industry is not adequately known in this country, so I make no apology for emphasising these facts. I noticed a discrepancy arising, which my noble friend Lord Trenchard indicated, between the figures that he had for the contribution to the balance of payments and the figure which my noble friend Lord Rochdale had mentioned in his opening speech. I think we ought, if possible, to get this settled, and I think it might be possible before the end of the debate when my noble friend Lord Trefgarne winds up. The latest information I have on this is a statement made only a week ago by the president of the General Council of British Shipping in which he said—and this was published:
"In 1977 the net direct contribution of UK ships to our balance of payments was over £1,000 million and in 1978 the net contribution is expected to be of the same order".
So my understanding is that the net contribution is of the order of something over £1,000 million. It may be that my noble friend was considering the sea transport account rather than the net contribution to the balance of payments. I do hope that this can be sorted out later because it is an important fact, if it is a fact, as I believe it is, that the British shipping industry still does make this net contribution to our economy.
I would like to comment before I sit down on two matters bearing on the future health of the industry to which I believe the Government should be addressing their serious attention: first, the close links with our ship-building industry, and secondly, the threat posed by the blatant undercutting of freight rates by the Soveit Union and the East European countries described in the Select Committee's Twelfth Report. That can only be carried out by massive

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subsidies within the State trading and State ownership systems practised by those countries. On the first matter, with regard to shipbuilding, the United Kingdom industry is in a very difficult situation. This arises because there is in the world about three times the capacity that the world needs. The United Kingdom shipping industry is making its contribution to solving the problems. It is calculated that at the end of last year 66 per cent. of all merchant ship tonnage due for United Kingdom registration was on order for building in United Kingdom yards, and that was an increase upon the percentage at the end of the previous year, 1977.
In the coming months the Government will have important decisions to take on shipbuilding. There are serious economic and social problems in the shipbuilding areas. I point out that jobs in the smaller firms supplying components and in ancillary industries are also affected and they are usually in the same areas. I ask the Government to answer the following questions if they can today: In assisting with remedial measures, will the Government keep in mind the wellbeing of the British Merchant Fleet?
Not only the British economy, but also the shipbuilding industry itself, will suffer if the British Fleet is badly damaged by schemes which help foreign competitors. Orders from abroad are, of course, welcome, but if they are attracted only by massive subsidies enjoyed by foreign shipowners, the subsequent competition is likely to be most unfair placing the British shipping industry at a great disadvantage. The Polish deal is past history, but it was disquieting at the time. For example, the subsidy element could mean that a ship was acquired by a foreigner for £1 million less than a similar ship being built for a British owner. That means that during its lifetime that ship would enjoy a start of £1 million against British competitors in the world shipping lanes. The Government should find a balance between the interests of both industries, because both industries are interdependent.
I turn to unfair competition from the Soviet bloc countries. A great deal has been heard about the expansion of the Soviet Navy, and rightly so. However,
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not enough has been heard about the expansion of the Soviet Merchant Fleet in this unfair way. Action has been taken within the EEC, but the report of our committee points out that it has not been enough. We do not know what happens in the Council of Ministers because the proceedings are confidential. The fact is, however, that the proposals of the Commission, limited as they were, were very much watered down and all that we have as a result is the monitoring over a period of two years—which started at the beginning of this year—of only two routes: one between the EEC and East Africa and the other between the EEC and Central America.
I accept the need to avoid unnecessary provocation of the Soviet Union. The matter can be handled in a friendly way. I understand that there is to be a meeting between Western interests and Soviet interests in August. I do not know whether it is simply again another meeting of the British/Soviet Maritime Commission. It may be wider, and perhaps my noble friend can inform us about that. I am sure that it is welcome that the Soviet Union has apparently agreed to join one conference—the India/Pakistan Conference mentioned by my noble friend. It has been suggested in the past that it might join conferences, but there were technical difficulties. However, from outside the liner conferences, the Soviet Union has launched deliberate offensives to take over as much cargo as possible on certain selected routes, charging freight rates which on commercial terms are simply not possible. Those rates can only arise from very heavy subsidisation.
From the United Kingdom point of view more action is needed—and much more effective action than is now being taken. I was very glad to hear the assurances given by my noble friend Lord Trenchard in his speech earlier this afternoon. I hope that the Government will accept the recommendations of the Select Committee and will succeed in persuading our partners in the EEC to act accordingly; namely, to strengthen the very limited measures which are now in train.
5.45 p.m.
The Earl of INCHCAPE: My Lords, as chairman of a major British shipping

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company, I am doubly grateful to the noble Viscount, Lord Rochdale, first, for his past services over many years to the shipping industry; and secondly, for his service today in initiating this debate and for his full and forthright speech in which he covered all the salient points of the industry's situation. His Motion is linked to the Twelfth Report of our EEC Committee and having taken part in the deliberations of the sub-committee I welcome the opportunity to contribute to the debate today.
Indeed, my EEC involvement goes back some years, because as president of the General Council of British Shipping, I went in 1976 to call on the noble Lord, the Lord President of the Council and Leader of the House, Lord Soames, who was then Commissioner for External Relations in Brussels. He made it clear how important it was for the United Kingdom to consider our shipping problems in Community terms—to add as it were a "Brussels dimension". We accepted that inspiring message in the spirit in which it was given, but to do this sort of thing is never easy. There are bound to be conflicts between various national interests of which shipping is only one. Other conflicts will arise too, between national interests and those of the Community. So, it is difficult to start from the basis of a grand design for a European shipping policy and hope that everything will fall into place.
Those of your Lordships who, like myself, favour a more pragmatic approach will in recent weeks have drawn comfort from the attitude of the EEC to the United Nations Liner Code which has been mentioned by several noble Lords this afternoon. That international convention has been referred to and debated before in your Lordships' House. There has been no doubt, ever since the text was finalised in 1974, about its divisive character. It has divided many developed countries from the developing countries of the Third World. Equally, it has created divisions between member countries within the EEC. And yet, it was possible for the EEC Commission at the UNCTAD Conference in Manila, which has just concluded, to present an agreed front on this issue.
The so-called "Brussels package" has the support not only of the EEC countries and of the Commission, but I believe of
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other Western countries, such as Sweden, Norway, Finland and Greece. Ship-owners no less than Governments have accepted this compromise; for compromise it is, as the noble Viscount, Lord Rochdale, has said. I would not wish to burden your Lordships with technicalities, but it is important to see where the compromise lies. The basic provisions of the Code on cargo-sharing — the famous 40-40-20 formula—will apply as to trade between developed and developing countries. Cargo-sharing in the trade between developed countries will continue to be determined by commercial criteria. These arrangements seem to me to accommodate commercial and political realities. alike.
However, important though the Code is, I see it against a wider backcloth. It represents a major topic on which the member-States of the Community and of the Commission, and of the various national shipowner associations, have managed to reach agreement. So, the question then arises: cannot we build on what has now been achieved? I think that we can, for the code is not the only example that I can cite of agreement, although it is by far the most important one.
Following the anxiety by the Eastern bloc fleet, the Community (as has been mentioned by several noble Lords) has agreed to monitor non-commercial competition. There is widespread agreement too on the measures that should be taken on safety grounds against substandard ships. But I would like to insert a word of warning here. There is a role for the EEC in co-ordinating action under internationally agreed safety and pollution conventions. But for it to duplicate the work done at IMCO would be a serious waste of time and money for all involved.
What all this suggests to me is that if we are to follow the advice of the noble Lord, Lord Soames, and try to import a European dimension into our shipping policy, we should do so on a pragmatic and step-by-step basis. Let us first seek agreement on both shipowner and Government networks, on individual issues and gradually build up a European shipping policy. That is, I am sure, a better line of approach than to draw up an elaborate and ambitious blueprint which would have little chance of being implemented

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and might well lead to disappointment and disillusion.
The noble Viscount, Lord Rochdale, did not limit his Motion to the EEC. It goes on to call attention to the
"problems of the shipping industry"
generally. I should like to take advantage of that wide invitation. As has been mentioned by many noble Lords this afternoon, we do have problems, but I want to set those problems in perspective. As the noble Viscount, Lord Rochdale, has said, the British fleet is now 40 million deadweight tons. It includes all the major types of merchant ships: oil and chemical tankers, gas carriers, bulk carriers, container ships, ro-ro ships and off-shore vessels, as well as passenger cruise ships and cross-Channel ferries.
In recent years the fleet has made an annual contribution to the balance of payments—and I should like to confirm the figure given by my noble friend Lord Campbell of Croy—of £1,000 million a year. That is the net figure. In addition, a further £300 million is saved by imports being carried in British ships. If it was not for its shipping, this country's modest surplus on current account for 1977 would have been a not-so-modest deficit, and the same would have been true in 1978.
As we are frequently reminded, North Sea oil will not last for ever, and for balance of payment reasons alone we still need a major British shipping industry. As my noble friend Lord Simon has said, we are also an important employer of seafarers and shore staff, and we are an important customer of United Kingdom shipyards, indeed traditionally their most important customer. We are of major importance to the insurance, shipbroking and forwarding businesses. We carry some 80 million tons of this country's imports and exports each year. So we are not being boastful when we say that a strong British shipping industry is of vital importance to this country. However, we in the shipping industry do not believe that this should be taken for granted because we have problems about the future
During the last five years the major problem has been one of worldwide over-tonnaging, particularly in the tanker sector. Even now we are not clear of it.
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The surplus of the largest tankers is likely to continue for several years yet. In the shipping industry we have taken the necessary steps—the sometimes painful necessary steps—to adjust capacity, and slowly shipyards are doing the same. We hope that Governments everywhere will now recognise that the only sure remedy for the world's shipbuilding sickness is a genuine revival in demand, and the essentials for national shipyards are competitive prices and prompt deliveries.
In shipping, too, competitiveness is one of our problems. It is one which the industry collectively and companies individually are tackling. But we are competing in a free market against ships with far lower crew costs than ours, and if we are to prosper, not only in the short term but in the long term, we must match and better the total costs of our competitors.
Then there is the field of co-operation with the Government. Here I am happy to say that there is no problem. We have always been lucky in having excellent relations with the Government of the day. For example, the last Administration provided the Dell Moratorium Scheme which has been of considerable help to one sector of the shipping industry. Recently, as the noble Viscount, Lord Trenchard, mentioned, your Lordships passed a Merchant Shipping Act—albeit at great speed—which had general support from both sides of the House and from the Cross-Benches.
This close working relationship with the Government is one of the invisible advantages of the British fleet. Developments in UNCTAD, competition from the Eastern bloc fleets, and the regulatory activities of the United States all demand that Government and industry work as one. The same is true in the fiscal sphere. The Chancellor is aware of our need for consortium group relief, and there is a need to stop foreign Governments taxing British ships when we do not tax theirs. I hope that my noble friend Lord Inverforth will have something to say on that subject. Finally, there is the problem of ensuring that our fleet is able to take advantage of the revival of the market when it comes, as it surely will.
For over a period of 10 years the British shipping industry invested an average of £1 million a day, as has been mentioned

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this afternoon. That period is now over; indeed, it has been over for some time. Reserves have been used in keeping afloat during a long hard recession. Inflation has made a nonsense of depreciation based on historic costs, and many ships have been sold by companies to pay off debt and so improve their balance sheets.
Therefore, replacement of the fleet is a formidable task. We have the skilled seafarers; we have the management; and we have many fine ships. But if we are to make full use of those advantages, the time will come when we shall need to make further investments; not growth for growth's sake, but growth to meet the likely expanding world demand for shipping services in the 1980s. I am not asking for investment grants. Valuable though they were, we do not think that they are the right solution. Rather, we believe that there is a case for investment allowances. I hope that this case can be developed to the Government and that the Government will look favourably upon it. After all, we in the shipping industry do not get certain advantages which are available to manufacturing industry, such as stock relief. Although it is accepted that this industry has served the country well over many decades, we must ensure that it will continue to do so, as that is in all our interests.
5.56 p.m.
Lord INVERFORTH: My Lords, as chairman of shipping companies I, too, particularly welcome the initiative of the noble Viscount, Lord Rochdale, in enabling us to spend some time this afternoon discussing British shipping. I should like to begin by mentioning the termendous problem which has been facing my own family company regarding the Vietnamese refugees, as both the "Sibonga" and the "Roachbank" belong to us. Noble Lords may recall that "Sibonga" rescued from the South China Sea 1,003 and "Roachbank" 295 of these unfortunate people. We have been glad to save their lives, feed them and aid them with medical supplies.
When the "Sibonga" arrived at Hong Kong we took on board doctors and nurses to further their care. In all we had them on board the vessel for two weeks and, although much has been reported of this
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incident in the Press and on television, little has been said of the remarkable seamanship of the master in handling the vessel during the actual rescue operation. This was carried out under very difficult circumstances in heavy swell conditions, with severely dehydrated and weak refugees, the majority of whom were women, children and babies in arms totally ill-suited to boarding on the open sea a vessel such as the "Sibonga". Despite having to lift them with improvised cradles on to the decks of the vessel—which was rising and falling over 30 feet—the only incident was a young women sustaining a slightly crushed toe.
For a cargo vessel designed under normal circumstances to accommodate only 60 persons, suddenly having to cope with such an enormous number of people, needed considerable organisation. The problems presented by sanitation, hygiene, potential disease and fire hazards I need only leave to your Lordships' imagination. The fact that the whole operation was managed so well illustrates the many skills, professionalism and humanitarian outlook needed by the master, officers and crew of a British ship.
The problem of the "Sibonga" refugees, thankfully, has been resolved. However, the "Roachbank", I regret to say, still lies idle at anchor off Taiwan with her refugees on board. She picked them up on 23rd May and four weeks later they are still with us. In the present state of our shipping industry we can ill afford the resultant loss of earnings. I am sure your Lordships will appreciate that in these circumstances the charterer immediately puts the ship off hire, and so we bear a considerable loss, in addition to the cost of feeding and caring for the refugees. These costs together have run us into many thousands of pounds and so far have all fallen on the shipowner. It is ironic that my company should be penalised financially, when each master was committed to fulfilling his legal obligations under the Maritime Conventions Act 1911.
I know that Her Majesty's Government are deeply engaged on this difficult question with the United Nations High Commission for Refugees, and have proposed an international conference on the subject, but all this takes a terribly long time. "Roachbank" is under a year old, a modern and expensive ship, and the long

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delay we are experiencing whilst Governments and diplomats struggle with the problem is extremely worrying and costly —to say nothing of the ineffective impression we give by being unable to carry on the ship's commercial activity. We shipowners do need assurance that if we save life we shall be relieved as quickly as possible of any victims we have picked up. The solution to the problem of the refugees is surely one for governments and not for individual shipowners.
May I now turn to shipbuilding, the plight of which industry is now even more bleak throughout the world than when I last addressed your Lordships a year ago. As you are aware, my company has been a good customer and 100 per cent. loyal to building in this country. Indeed, since the Second World War we have built 82 vessels, with the 82nd being delivered today more than a month ahead of contract date. It is surely fair to claim the successes of British Shipbuilders as much as their failures so far as deliveries are concerned. The shipbuilding industry can only survive if it gives the customer what he requires, when he wants it. It is no good trying to persuade owners to build surplus to their own requirements at a time when there is already a surplus of tonnage worldwide.
I have always felt that this country should have an efficient shipbuilding industry—not only for defence purposes but also to produce ships of good quality for our merchant fleet. Shipbuilders, however, must concentrate on improving their efficiency, so that when an owner does want to build he can be quoted the keenest price and offered the best delivery terms with the assurance of both management and their workforce.
My Lords, there is another aspect affecting competition which I should like to mention. British ships operate with crew sizes which are legislated or recommended by the Department of Trade. These numbers are frequently in exess of those required by our EEC partners, or for that matter by other main foreign-flag carriers. The British shipowner is therefore at a considerable disadvantage. Is it not possible for IMCO to extend its legislation in this particular field? Meantime our own Department of Trade must seriously reconsider manning levels on British-flag vessels. Every single pound per day counts, and we look to the United
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Kingdom Government to see that we are not placed at a disadvantage.
Another example of this concerns safety and, while British shipowners approve the lead that the United Kingdom Government give at IMCO in producing new internationally agreed legislation, what we cannot afford is for the United Kingdom alone to go beyond such legislation, in a way which puts us at a competitive disadvantage. We cannot afford to pay more than our responsible competitors for survey fees, and we cannot afford to have safety requirements greater than those competitors, or the expensive testing of equipment which has already been approved in other reputable countries. These are not issues of safety but of cost. The British fleet's safety record is already three times as good as the world's, but please do not penalise us with extra financial burdens. An internationally agreed safety code, through the offices of IMCO, is the best solution—with such legislation adopted and monitored by all member-States.
My noble friend Lord Inchcape has mentioned briefly the problem of foreign Governments taxing British ships when we do not tax theirs. At this time of major depression our industry can ill afford the payment of unnecessary, unfair and at times discriminating taxes. Although developed countries on the whole incorporate the OECD principle of exemption for shipping, there is an increasing tendency for developing countries to tax our ships—usually by reference to turnover, which they quite wrongly equate to profits. United Kingdom shipowners therefore effectively bear a further overhead expense to which the foreign shipowner from the country concerned is not liable. Not only therefore are we less competitive but we are being obliged to pay out increasingly substantial sums of money at a time of losses and real financial stringency. What is more, we are paying these taxes to countries many of which in fact are in receipt of grants in aid from this country—let alone, on occasion, the gift of cheap ships. Just touching on capital taxation, we were very interested to see what the Chancellor had to say in his Budget statement and hope very much that we may look forward to some relief in this difficult area.
One final word about the EEC. Shipping is an international industry. The interests

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of the Community's merchant fleets are essentially directed outwards towards the rest of the world rather than to intra-EEC trade, although this has grown significantly. The problems that face the EEC in shipping therefore cannot be treated like transport problems, which are purely internal. Thus, in whatever way EEC competition policy may relate to intra-EEC trade, I believe it does not apply to international liner shipping. Shipowners are hungry creatures these days and competition is fiercely intense. On many of my own company's international trading routes our most formidable and persistent rivals are in fact fellow-members of the EEC. Consequently I hope that Her Majesty's Government will oppose any attempts by the European Commission to apply the EEC Competition Rules to international liner shipping. This is not just because liner conferences have a much wider basis than the European Community, but because we believe that relationships between shippers and conferences should continue to be established at a commercial level. The last thing we want is a European equivalent of the US Federal Maritime Commission to regulate the application of the EEC Competition Rules to shipping. We have only to look at the recent developments in the US trades to see what a disastrous effect this could have on the commercial operations of our merchant fleets.
Notwithstanding the competitive pressures of everyday commercial life which I have just mentioned, there are many wider policy issues where the shipowners of the EEC can co-operate closely to their mutual advantage. I was very happy that a compromise was reached among the EEC partners on their approach to the UN Liner Code, so that we were all able to go to the recent UNCTAD meeting in Manila with one voice on this complicated but important issue. It is on the wider range of shipping policies such as this that the EEC could well be very useful to us in the future. My Lords, I have spoken on a variety of shipping matters, but I hope that what I have said may be regarded as useful and that the Government will take note of my points.
6.8 p.m.
Lord RUNCIMAN of DOXFORD: My Lords, like other noble Lords I should
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like, at the risk of a desirable repetition, to thank my noble friend Lord Rochdale again both for starting this debate and for the manner in which he did so. I do so all the more because of the interest which I must now declare, which is that I have been a practising shipowner for something over 50 years, and still more or less am. That gives one a slight feeling of having seen an awful lot of this before.
It was no great pleasure being a ship-owner in the depression of the 1930s, but I think it is true to say that the current —I am told by someone in the House this afternoon that I must not use the word "depression"—situation with regard to sea transport is more difficult for the British owner than that situation was because of one or two technical things. It is much more difficult to deal with a small fleet of large ships than with a larger fleet of smaller ships. You have more flexibility with the latter. You have inflation as compared with, if anything, falling costs in the 1930s, and, above all, the political bedevilment of so much of international shipping, which has rightly been the subject the greater part of your Lordships' debate this afternoon.
I will not try to add to what people better informed than myself have had to say about the liner trade, except to echo something which fell from my noble friend Lord Rochdale when he urged that the commercial interests of this country should make more use of shippers' councils. I have seen something of it from both sides of the fence and it is disappointing that, in their own interest, let alone that of British shipping, shippers' councils are not stronger, more effective and more numerous.
Otherwise, I wish to speak briefly on the bulk cargo section of the British fleet. It is closely allied, of course, with the independent tanker section and the problems which face it; namely, that they are both subject to the charter market, which is itself probably the most extreme case of simple economics of supply and demand governing price, certainly that I know of, anywhere in the world. The liner conferences can to some extent cushion, or at any rate postpone or make less violent, the effects of supply and

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demand, but the tramp market, to use the old-fashioned term for it, cannot, and the fluctuations are quite startling. One remembers freights falling by 75 per cent. on a particular commodity in a large trade over a period of six months, which is not the kind of thing which has to be put up with by most industries.
Bulk cargo ships form a little under one-quarter of the total tonnage of the United Kingdom; or it would probably be more correct to say that it did so at the beginning of 1978 because, as has been suggested already this afternoon, it is pretty clear that the sales of United Kingdom ships to foreign owners have been mainly in the independent tanker and bulk cargo markets. The reason for that is simple—in fact I have just given it; namely, that they are immediately subject to falls in price which, if your standards are the sort of standards which United Kingdom shipowners have learned to observe and if your financial arrangements over the last years have been such that you have built ships on borrowed money and therefore have no fat, or not much, to live on, you are obliged to sell to keep a cash flow going, and I cannot see any immediate prospect of that process being reversed.
The only long-term remedy, so far as the bulk market is concerned, is a sustained increase in the demand for bulk commodities to be carried about the world by sea. There has happily been a welcome increase recently and, if this is sustained, I dare say those of us who are in that trade will feel encouraged to remain in it rather longer than we otherwise might. But it will take a very much larger recovery in world trade than anyone can foresee to enable the British bulk owner to compete successfully with those to whom he has sold, very often at a loss, ships which they can operate much more cheaply than he can, in matters of crew and the like, and also they are people who have had advantages in not paying taxes over the years which has left them with rather more cash available to see them through bad times. That is no new phenomenon either; one saw it not so early as the '30s but in the depression which followed the Korean war, and one has seen it at intervals since. I am afraid, therefore, that the chances of a suitable sufficient increase in demand are not really very great. The only hope for the moment,
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and it seems a slim one, is a diminution in the supply; in other words, a real cutting back in the building of unwanted ships by yards subsidised for that purpose in a good many countries. That is always difficult. You can buy or sell a ship or you can order a ship, and it does not take very long one way of the other. You set up a shipyard and you then have a very large establishment. Of course in shipbuilding, which is largely an assembling industry—mention has already been made of the number of sub-contractors involved in any shipbuilding operation—it is very much more difficult to unwind it without a great loss in the employment of the people you have taken on to run it in the first place. If you are talking about jobs in shipbuilding and jobs in shipowning, you will always find there are more jobs to be considered in shipbuilding than there are in shipowning, which is a most capital intensive trade.
There is always a tendency for people who are looking for the employment of their nationals to favour the shipbuilder at the expense of the shipowner. If that goes on, I take an extremely gloomy view of the future of the bulk cargo part of the United Kingdom fleet. And if we should find ourselves with a very small number of bulk carriers at a time of war or threatened war, we might find ourselves in the situation, which was described with just sympathy by the noble Viscount, Lord Simon, of being dependent on other people for our own vital necessities. I can pose the problem, but I cannot really attempt to answer it. I can only say from that point of view that I think the beginning of widsom is the reduction in unwanted tonnage.
6.18 p.m.
Lord TREFGARNE: My Lords, I rise armed with a sheaf of papers informed to answer almost every point that has been made in this debate, but we will see how we go and if I get a bit long-winded perhaps noble Lords will forgive me if I cut my remarks short and answer the rest of the points in correspondence. As my noble friend Lord Trenchard has already covered most of the foreign shipping relations matters that have been raised, I will concentrate my attention more narrowly on the United Kingdom industry and some of its specific and more domestic problems.

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First, I will make some initial general remarks. I am heartened by the emphasis that successive speakers have laid on preserving the essentials of our traditional approach to foreign shipping relations. The interests of the United Kingdom industry lie with maintaining a free commercial environment, particularly in the developed world, but we must bear that in mind when framing our domestic policies too and not let the recession become an excuse for adopting narrow or protectionist attitudes at home.
Secondly, and this also echoes much of what has already been said, despite its problems, we must recognise the success of our United Kingdom shipping industry. Nobody denies that times have been very difficult, but we pay tribute to the resourcefulness and ingenuity with which the industry has met its difficulties. Shipping remains a major United Kingdom industry and United Kingdom shipping remains a major force in the world. What is especially encouraging is that we are among the leaders in the most modern, efficient and dynamic sector; namely, the containerisation of liner cargo.
I am of course aware that United Kingdom shipping, like its foreign competitors, is suffering from the effects of a recession, perhaps the worst since the 1930s. It originated in the great expansion, largely outside the United Kingdom, of new shipbuilding in the 1960s, and was followed by the oil crisis of 1973, and then the slow growth of world trade since that time. Too many ships are chasing too little cargo. Freight rates and earnings are depressed. The oil tanker sector was earliest and hardest hit, and has not yet recovered. Meanwhile, over-capacity has spread, first, to dry bulk carriers—by which I mean those carrying dry cargo on regular services. So far the industry has weathered the storm well without Government assistance on any large scale, thanks to the enterprise, efficiency, and generally good management and labour relations. But there could still be difficult times ahead. Forecasts vary as to when the market for shipping services will return to balance, but it is likely to be years rather than months. The effects of such a prolonged recession are bound to put a strain on any industry's resources. I know that the industry is taking steps to cut costs and increase revenue and efficiency, and it is
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also discussing what further action needs to be taken in co-operation with the Government.
May I now turn to the various speeches that have been made and try to deal with at least some of the important points. The noble Viscount, Lord Rochdale, to whom we must record our gratitude for initiating the debate, made a number of points which I shall cover in a few moments. First, I want to make our position clear on the Grand Jury investigation to which the noble Viscount referred, and which has caused considerable concern in the Government. It is perhaps worth recording that the maximum fine in this case of 50,000 dollars was imposed on 13 individuals, two of whom were United Kingdom citizens. Furthermore, the maximum fine was imposed on two British members of certain consortia operating on these trades, totalling 1·8 million dollars. These latter fines were in fact agreed settlements made out of court. As my noble friend Lord Trenchard said, my right honourable friend the Secretary of State for Trade made a statement expressing Her Majesty's Government's grave concern at the recent prosecution by United States authorities of British shipping interests, and we are awaiting their response.
The noble Viscount, Lord Rochdale, also asked me about the joint British-Soviet Maritime Commission which held a meeting in London recently. The commission reviewed various trades where there is a significant Soviet presence. The United Kingdom side welcomed the agreement opening the way for a Soviet line to become a member of the India, Pakistan and Bangladesh conference, but we expressed regret at the continuing disagreement between the Soviet line and the East African conference. The commission reviewed the bilateral UK-USSR trade and, I am told, noted an encouraging increase in the proportion of trade carried by the United Kingdom flag.
The Soviet threat has been mentioned by almost every noble Lord who has spoken today, and several noble Lords have been critical of the progress being made in the EEC on this matter. But I would remind your Lordships that it is our policy, and indeed the policy of our predecessors, to proceed in these matters —not only in the EEC and elsewhere—

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wherever possible by negotiation behind the scenes and by persuasion and accommodation. While it may not be inappropriate to consider what retaliatory actions could be taken if the need arose, the time has certainly not yet come when we should consider taking those actions. But we certainly believe that the EEC ought to consider what measures could be taken, and we are continuing to use our influence to get them to agree to that. May I, in parenthesis, try to keep the matter in perspective. The United Kingdom Fleet in 1978 was 49·7 million deadweight tonnes, although there has been some small decline since then, and the Russian Fleet was still only 19·8 million dead weight tonnes. So, for the moment at least, we are still almost two and a half times the size of the Russian Fleet—
Lord GORONWY-ROBERTS: My Lords, before the noble Lord leaves the question of the possibility of countervailing action, may I put a point to him? I understand that the monitoring exercise which has been agreed—although it has been restricted to two routes, and there are a number of other reservations about it in some quarters—will take two years. The present EEC attitude (if I may call it that) is that countervailing measures should not be considered or thought out until the monitoring exercise—if and when it takes place—has been completed. That puts the point of countervailing action, if it proves necessary, at at least two years, and very probably at least three years, beyond today. In the meantime the pressures on our own shipping and that of others among our partners are real and may intensify. May I ask the Minister to give urgent consideration to pressing our friends and partners to engage in a notional exercise on countermeasures pending the end of the monitoring period? What is to be lost by doing that while the monitoring is going on, rather than postponing even the consideration of the measures until after the monitoring is over, which would be two years ahead?
Lord TREFGARNE: My Lords, I cannot hide from your Lordships the fact that we are disappointed by the present EEC position on this matter. We are certainly pressing them now as opportunity
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arises to reconsider the position in this regard and indeed to consider now what actions might be taken should they become necessary in future. As the noble Lord knows, we have to take our EEC partners with us; we cannot on our own steamroller the EEC into doing this. But the noble Lord may be assured that we are doing everything we can through the proper channels and by the proper means to get the EEC to change their ideas in this direction and to achieve what the noble Lord is seeking. Certainly the noble Lord and I are at one as to what ought to be done in this situation.
I now wish to turn to the remarks which the noble Lord, Lord Goronwy-Roberts, made in his speech. I believe that I have already covered his principal point about the need for more concerted and more effective action in the EEC. The noble Lord raised some other points, almost all of which I think I have now covered. Further, he raised the question of Soviet practices, which is really part of the same concern leading up to what we hope will be a better solution in the EEC, and he asked whether the matter is being raised in the Council of Ministers. As the noble Lords knows, it has been recently raised with regrettably unsatisfactory results, but we shall continue to press for it to be reconsidered, and I have no doubt it will be raised again in the near future.
The noble Viscount, Lord Simon, also referred, at some length, to the Soviet threat. I am glad that the noble Viscount (who is not in his place at the moment) also preferred accommodation to confrontation. That is certainly our preferred policy, and we hope that in this matter we shall be able to achieve that. The noble Viscount, Lord Simon, along with the other noble Lords, also asked me about worker participation and about what we were doing for what I think he called "crew comforts", for our seamen. This is of course a most germane point, and I shall write to him on it specifically.
The noble Lord, Lord Hayter, asked me about the Economic Development Committee for international freight movement. He referred to the activities of the little Neddy and its discussions on the state of the shipping industry. Shipping is a uniquely international industry and

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many of the factors which influence world shipping are inevitably outside our control. That alone makes it doubly difficult to forecast the future with any confidence. Because of its international nature, many of the central questions affecting shipping safety, pollution, the liner code, and so on are best considered in the appropriate international fora. Regular meetings now are well established between the General Council of British Shipping and the seafarers' organisations to discuss economic aspects. So far as I know, the little Neddy for international freight movement is the only body which brings together formally representatives of Government, management, the unions and the customers. Although its remit is wider than shipping, it has a role to play in the exchange of views and ideas, particularly during this difficult time for the shipping industry.
The noble Lord, Lord Hayter, also asked about overseas aid and special deals involving shipbuilding. Several noble Lords raised the potential damage to United Kingdom shipping through the grant of special terms to our competitors to order ships in this country or to assist in the purchase of ships under the aid programme. Perhaps I can say more about that in a moment. When I come to refer to the remarks of my noble friend Lord Campbell of Croy, I can refer specifically to the Vietnam ships deal where I think there are some lessons to be learnt.
If I may now turn to the remarks of my noble friend Lord Campbell of Croy, he asked me to try to clarify the apparent discrepancy between the remarks of my noble friend Lord Trenchard and the noble Viscount, Lord Rochdale, on the balance-of-payments situation. I think that there may be some misunderstanding about the different terms involved. Certainly United Kingdom-owned ships earned in 1977 about £1,000 million net; but the shipping account included payments by United Kingdom nationals for shipping services to non-United Kingdom shipping companies. If those figures are taken into consideration, then in 1978 the total shipping account moved into a deficit position, of (so I am advised) £300 million, and it may be worse in this year. The figure of £1 billion total deficit has been suggested for 1980, but we believe that that is unduly pessimistic.
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My noble friend Lord Campbell of Croy also asked about the August meeting on Soviet shipping matters. This is a meeting between the United Kingdom and the USSR shipowners which, by the nature of the Russian situation, is principally the Russian Government; but it really only relates to bilateral trade and is not part of the process of seeking a more general accommodation. The next formal meeting with the Soviet Government is the Joint Maritime Commission meeting next year, but contact between individual liner conferences and Soviet lines will be continued in an attempt to find an acceptable basis for entry into these new conferences.
I now refer to the sale of ships, with aid, as was done in the case of Vietnam. There is perhaps a general lesson to be learned from that case which may apply to other similar deals when considered in the future. The offer of £4½ million from the aid to trade contingency provision, as it is called, to assist with the purchase of four SD 14 general cargo vessels from Austin and Pickersgill was made by the previous Administration and embodied in a formal exchange of notes with the Government of Vietnam. The previous Administration explained in the other place on the 13th February the reasons for this step. Since then one ship has been delivered, various instalments paid on others, and almost £2.3 million remains to be paid. Under the terms of the agreement these instalments are paid directly to British Shipbuilders and we see no possibility of their being diverted by the Vietnamese authorities. The aid forms an essential part of the contractual arrangements for the sale of ships which Vietnam could otherwise have bought elsewhere in the world market at prices broadly competitive with our price after allowing for aid and put them into service in competition with our own shipping lines. The general lesson to be learned from these deals is that the developing countries will buy their ships from where they can and doubtless they will get them at least as cheaply from elsewhere; so that we face competition for our shipping industry whether we supply ships or not. It is therefore sometimes worth proceeding with these deals simply as a good means of providing additional business which is sorely needed in our shipyards.

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The noble Earl, Lord Inchcape, in an interesting speech asked me a number of points. I am not sure that I shall be able to answer them all this evening. I shall try to do so, but if I miss any I shall write to the noble Lord. He asked particularly about investment allowances. He asked whether there will be sufficient incentive for the shipping industry to reinvest when the recession comes to an end. Mention was made of investment allowances. The industry already enjoys the advantage of a 100 per cent. free depreciation on the purchase of new ships, which means that it is not badly off in relation to its European competitors. The Government will examine with care any proposals from the industry but obviously we can make no commitment at this time.
The noble Earl, Lord Inchcape, referred to the swift passing of the Merchant Shipping Act at the end of the last Session. The noble Earl will appreciate, I think, that they were unusual times and, although we shall be monitoring the effect of the Act as passed, we have no immediate plans for introducing any amending legislation.
The noble Lord, Lord Inverforth, referred to the serious problem of the Vietnam refugees with which his company has been particularly involved. We recognise the pressures and frustrations faced by ships' masters and shipping companies not only when rescuing Vietnam refugees in the South China seas but in the period afterwards when arrangements are made to provide at least temporary asylum. There is no question but that we support the action which ships' masters have taken in recent incidents. It reflects great credit on them and on the shipping companies. The difficulties which arise after the refugees have been rescued bring forward many conflicting considerations for the Government to take into account. We have decided upon humanitarian grounds to accept all refugees from the "Sibonga" and all those from the "Roachbank" which the Taiwanese will not accept. The scale of the problem is such that the Government cannot make an open-ended commitment. A solution has to be sought on an international basis rather than by the United Kingdom alone.
Both the noble Earl, Lord Inchcape,
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and the noble Lord, Lord Inverforth, complained of the double taxation which sometimes falls on British shipping companies. The Government are certainly concerned about the increasing number of countries which impose taxes on shipping revenue earned on turnover rather than on profitability. While we have some sympathy with the view that reserved countervailing powers should be available to the Government to be used in situations where our shipping interests are treated unfairly, there is a danger that the existence of such powers will be counter-productive when conducting negotiations on double taxation agreements. We will keep the matter under careful review.
Finally, I refer to the point made by the noble Lord, Lord Inverforth, about the application of stringent safety and manning requirements on British ship operators. I have taken careful note of what the noble Lord has said. The Government have no desire to place British fleets at any commercial disadvantage; but, as I understand it, the recommended manning levels are directed at securing the safe operation of these ships, which is surely the common object of both Government and industry. However, if the noble Lord has particular points that he wants to raise, I shall be happy to draw them to the attention of my right honourable friend. My Lords, I have spoken too long already, I fear. May I end by reminding your Lordships that British greatness was perhaps built upon the shipping industry as much as any other, and as it is a central tenet of this present Government's policy to restore this nation to its rightful place at the top table of the world, we feel sure that the shipping industry will help us do that again as it has done in the past.
6.41 p.m.
Viscount ROCHDALE: My Lords, I am sure that anyone moving a Motion in your Lordships' House, and having from every speaker the feeling that the debate has been worthwhile and has raised important matters, cannot but be satisfied. For my part, I am very pleased with the way that this debate has gone. I should like to thank all noble Lords who have taken part in the debate from their several points of view and experience, and from many points of view there has been great experience shown. I should like in parti-

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cular to thank the spokesman from the Front Benches, the noble Lord, Lord Goronwy-Roberts, who made a very important contribution, and also my two noble friends on the Government Front Bench, the noble Viscount, Lord Trenchard, and the noble Lord, Lord Trefgarne.
The word "euphoria" crept in during the course of the debate. Obviously, it would be wrong if the message were to go out from this House that it was merely one of general euphoria in what was going on in the shipping world in the United Kingdom. But it would be equally wrong if we did not interpret the word "euphoria" as recognising and expressing appreciation of what the industry and all those who work in it are doing in the extremely difficult circumstances in which they have to operate today. Obviously, there are enormous problems; they have all been referred to and analysed. I hope that the result will not be merely words but will encourage the Government to continue with the department the excellent work of action to get some of these problems resolved as quickly as possible.
I am very grateful to my noble friend Lord Trefgarne for resolving the little problem of the contributions to the balance of payments. When we all read that in Hansard we shall find that we were both, broadly speaking, right; it was merely a matter of how the references were phrased.
Perhaps I may make one other point. Shipping is not a subject that lends itself to emotion; but I must say, listening to the noble Lord, Lord Inverforth, that there was a degree of emotion—and rightly so—when he reported and gave us a very interesting account of what went on in the case of the "Sibonga". It showed that those who serve at sea in these ships today continue to live up to the highest traditions of the Service. I am very glad he made that point. My Lords, having said that, and having again thanked all noble Lords for their contributions, I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

ANIMAL WELFARE: PROPOSED COUNCIL
6.44 p.m.
Lord HOUGHTON of SOWERBYrose to ask Her Majesty's Government
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whether they will set up the Council for Animal Welfare announced in the last Parliament and, if not, what alternative they propose. The noble Lord said: My Lords, we pass from a debate on shipping to a proposal for the setting up of a council for animal welfare which perhaps, unlike shipping, does arouse emotions and is of deep concern to a great number of people throughout the land. In order to have the matter in full perspective, I hope that your Lordships will forgive me if I go back to the announcement made by the then Prime Minister my right honourable friend Mr. Callaghan on 22nd March of this year. In the House of Commons he announced:
"The Government share the growing concern about the treatment of animals and have decided to set up a council for animal welfare to maintain an oversight in this matter and to advise the Government.
The council will have the power to review existing legislation and recommend legislative or other action on any animal welfare matter and to propose improvements in the existing advisory machinery.
That machinery includes the farm animal welfare advisory committee and the advisory committee on the administration of the Cruelty to Animals Act 1976, which is soon to be reconstituted with new terms of reference. In addition, the Government are appointing a new advisory committee on the transport of farm animals.
The council for animal welfare, which will have its own independent chairman, will comprise the chairmen of these three committees, which will constitute its standing committees, together with a number of additional independent members.
A further announcement about the council's composition and terms of reference will be made as soon as possible".—(Official Report, Commons, col. 718).
That is the end of that quotation, but there was a Press release from No. 10 Downing Street on the same day. In notes to editors the Government's proposals were embellished a little:
"The Government decided to set up the council in view of growing public concern about animal welfare generally.
The council represents a new and independent approach to animal welfare and a focal point in what is a very diverse field. As the Prime Minister has made clear, the council will be empowered to review legislation concerning animal welfare and to recommend legislative or other action on any animal welfare matters.
Although its terms of reference have not yet been finally decided, it will be within the scope of the council to examine any aspect of animal welfare and make recommendations on action that needs to be taken.
Areas for consideration could include use of animals in laboratory work, seal culling, deer poaching, field sports, transport and export of

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animals, cruelty displayed on TV and in films and the treatment of animals in zoos and circuses.
Although the council is not being set up to investigate individual complaints, the public will be free to write to the council on any policy matter affecting the welfare of animals and the council will follow up matters raised by the public with the appropriate representative bodies".
That was an announcement made to the great satisfaction of a very large number of animal welfare societies. They looked forward to the appointment of this council and to see it begin its work. Then the general election intervened, so naturally those of us who had been working in this movement were anxious to know what the attitude of the new Government would be towards the announcement made by their predecessors. I raised this matter when I spoke in the debate on the Address on 17th May. The Minister, the noble Lord, Lord Belstead, in reply to what I said, teased me a little, and he half accused me of being a Conservative. It was all good natured and taken in very good spirit. But the disquieting aspect was that he said (at col. 219 of Hansard):
"I am bound to say that we do not agree with the previous Government concerning the desirability of having a council for animal welfare, but that is a disagreement about means and not about ends"
I let that pass. I realised that 17th May was early days after the new Government had taken office.
I ought perhaps to apologise now for not having given the Minister notice beforehand that this was the matter I was going to raise in my speech on the Address. He might have been better equipped to deal with it had I done so. However, the matter has been pursued further in another place, and on 14th June, Mr. Walker, the Minister for Agriculture, said, in column 600, in reply to a Question:
"The announcement by the previous Prime Minister was generally welcomed as an important advance in this area. Obviously we have studied the last Government's specific proposals and they will be influencing our thinking. I ask the hon. Gentleman to wait until we announce our own detailed proposals, but I assure him that the objective of those proposals will be exactly the same as the intentions of the previous Government".
That, so far as I am aware, is where the matter now stands. So I am hopeful that I raise this matter again at a timely moment to bring to bear on the Government's thinking considerations which I think should carry some weight.
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May I say in passing that if there is one piece of advice I could presume to give to Ministers, Governments, trade union leaders or employers all those who have to do with the contentious affairs of public opinion and the conflicting interests and points of view of many people—it is this: Always give full weight to moderate leadership. I ask the Government to give full weight to the united voice of moderate leadership in the animal welfare movement at the present time. When I was in government, one of my jobs was to try to bring together the voluntary bodies who were dealing with social affairs. It was not a rewarding experience. I have since done my best to bring together a diversity of organisations dealing with animal welfare, and I am very glad to say that over the last 12 months there has been a remarkable unity between those bodies in their approach to the political parties during the recent general election. Never before have parties been approached by such a solid and united voice of animal welfare societies—and may I add with pleasure that never before have political parties responded to that in such a way, by including in their respective election Manifestoes promises about animal welfare.
I am not going to prejudge the conclusions of the Government. Action is what is needed. What we are talking about concerns machinery and methods: how to get things done. Action is really the keynote to all this and, in some areas, speedy action, too. What I think I should say is that, if there is to be an alternative to the proposed council, then it should be something better and not something worse. It should be something that will yield action and not delay it, or, in some cases, postpone it almost indefinitely. It should bear unmistakable signs of the probability of positive action, and I am sorry to say that I do not feel confident about this. I feel I want some assurances here, if I may say so.
Why does this proposal for a council appeal so strongly to the animal welfare societies? The answer is that they were all unitedly in favour of it. They put forward this proposal to the three main political parties, and the Labour party and the Liberal Party Manifestoes pledge themselves in favour of this. The Conservative Party, while making very welcome and valuable promises on specific

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measures of animal protection, did not mention this proposal.
The Government have a proposal before them which has been so strongly backed by the welfare societies and also, may I say, welcomed by a number of the trade protection societies: that I do know. When the Minister of Agriculture went round asking various interests in the field of animal husbandry and so on, he found a very ready response to the idea of the setting up of this council. The Government must have very good reasons for dropping this idea, if they do drop it, in favour of something else. We, the representatives of the animal welfare societies, set out in our own booklet the reason why we strongly favour this idea and we were delighted when the last Government finally took it up and gave a pledge about it.
The great value of a council of this kind would be to have a clearing house for the wide range of animal welfare in a field where at the present time there is not only diversity but a great deal of disconnected activity, departmentally speaking. It would be a very good thing to have somewhere to go—a body which could watch for overlapping or for lack of co-ordination and get particular matters attended to by relevant departments. Where, for example, do we go in Whitehall for a study of conditions in zoological gardens or circuses? Where do we go for cruelty which is shown on films or on TV? Where do we go on a question of the realities of, say, live hare-coursing or stag hunting, to give a few examples? I know of no department which would take responsibility, unless cruelty were involved. It is a curious thing how the approach of human beings to animals has always been in terms of cruelty. Unless there is cruelty, it seems to be all right. Hardship, discomfort, psychological disorientation and things of that kind seem not to concern a lot of people who would normally think they were reasonably kind persons. So I think there is a great deal in this proposal which is probably not visible at a casual glance.
Finally, there are various aspects of the exploitation of animals which gather momentum when commercial interests are strongly backing them but which are not really noticed until they become so
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serious that it is difficult to reverse them. Therefore, I am going to end with a plea: If the Government are still reflecting on this matter and if their minds are still open to discussion, will they allow representatives of the animal welfare societies to see a Minister and talk it over? I do not think the Government should set aside a decision of the last Government on a non-political matter of this kind, to which so much importance is attached by the animal lobby, without first listening to the argument. Are the Government prepared to respond to that request? I earnestly ask them to do so.
6.59 p.m.
Earl GREY: My Lords, I am grateful to the noble Lord, Lord Houghton of Sowerby, for raising this very important Question, asking the Government whether they will set up the council for animal welfare. Dr. Shirley Summerskill, when Under-Secretary of State for the Home Office, said in another place during a debate on animal welfare on 23rd March last that the Advisory Committee on the administration of the Cruelty to Animals Act is to be reconstituted and is to have new terms of reference, which will give it a much wider role. Perhaps we may know this evening whether this new Government are prepared to carry out that commitment.
I can envisage only benefits if the decision setting up the council, outlined by Mr. Callaghan on 22nd March, is effected by the present Government. Considerations included in this council were use of animals in laboratory work, seal culling, deer poaching, field sports, the transport and export of animals and other measures. I should like to comment on one or two areas about which I feel strongly, although I admit that I am not an expert and the view is one of a layman.
One is the export of live animals to the Continent for slaughter. There are instances of calves being exported when only three or four days old. I believe this practice to be disgraceful and inhuman and it should be stopped. There are also cases of animals being cooped up in confined areas for long periods without food or water while in transit, before arriving at their destinations to be slaughtered. I have read of cases of over 24 hours and one of 48 hours, when animals were in this condition. It may seem ironic

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to advocate slaughtering an animal two or three days before necessary, but I cannot see why in many cases this is not done before export, thus alleviating suffering. I believe that our abattoirs are at the moment working under capacity and tanneries are facing a redundancy situation. What we are, in fact, doing is giving profit and employment to our competitors.
Anyone who has visited a battery henhouse in operation surely cannot condone a practice where hundreds of hens are cooped up in confined spaces all their lives, never seeing the light of day. I have seen this and it did not impress me one bit. A pet shop owner would be prosecuted if a pet bird was displayed in a cage so small that all it could do was either stand up or sit down. I should like to see legislation directed in this area. While speaking on the subject of pets I agree with Mr. Stephen Ross, who said in another place on 23rd March that he would like to see a ban on the importation of tortoises. The percentage of tortoises that are dead on arrival is terrifying, sometimes as high as 85 per cent. The same applies in the case of birds and many other animals which are imported after being taken from their natural environment.
So much has been written and said regarding experiments on live animals that I think the truth should be known. I believe that a lot of these experiments are painfully cruel and unjustified. I should like the Government to investigate thoroughly this area of experimentation and report to Parliament their findings as soon as possible. The Liberal view on animal welfare is straightforward and honest. It is that the human race should act as trustee for the rest of the natural world, and not as its master. It is a view that I believe in, and is one that should be universally held.
7.3 p.m.
Lord COLLISON: My Lords, I am very glad indeed that my noble friend Lord Houghton of Sowerby has asked this Question and, with him, I sincerely hope that the Government will be able to give us some kind of answer. Like him, too, I should like the proposition which was initiated by the late Prime Minister to be the proposition which is accepted. If this Government have other
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ideas, again I would endorse what my noble friend said when he pointed out that, if an alternative is to be proposed, then it should be a better one than the one already put forward. My noble friend has dealt with what was contained in the Press release and the last Prime Minister's Statement, and your Lordships will be pleased to know—because nobody would thank me for a long speech at this time of night—that that gets me over four or five pages of my notes.
In another place on the day following the Press notice, a debate was initiated by my honourable friend Mr. J. W. Rooker, and the report of that debate is contained in the Hansard of that day, 23rd March, at columns 1874–87. In my view, Mr. Rooker covered the ground completely and very well indeed. There is, of course, no time to reiterate all the points he made, and it would be wrong for me to do so. I should concentrate on those matters about which I am particularly concerned.
I know that people have been greatly shocked. Most of them have not read that speech of Mr. Rooker's, but they have seen Press notices and have also seen television. There is a tremendous groundswell, because people are concerned about the welfare of animals, seeing them as the responsibility of man, because they are themselves more or less helpless. But on television recently, my wife and I saw rabbits being forced to inhale cigarette smoke—to prove what? Surely we know enough about what cigarette smoking does to people in terms of lung cancer. Human evidence has shown that over and over again. So why subject animals to what must be sheer torture, for no good reason at all that I can see?
Furthermore, who can condone the dropping of substances into the eyes of animals to find out whether they cause smarting, blindness, distension of the iris and so on, simply in the interests of proving that cosmetics will not harm a woman's eyes or skin? I find that absolutely and completely disgusting. I am afraid that I speak strongly, but I feel strongly about this matter and so do women. My wife saw that programme. She is not more emotional than most people, but when she saw what was happening to those animals she almost burst into tears.

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Other things are being done. Animals are subjected to a stress situation to cause anxiety, in order to determine how animals react and how they behave in such circumstances. Are these things —and there are many others which Mr. Rooker quoted, but which I do not have time to mention—really necessary? Is it necessary to go to these lengths to find out something which, in any case, most of us know already? I think not, and I believe that many people like me also think not.
In the other place during the same debate your Lordships' House came under considerable criticism, because in May, 1978, your Lordships rejected the Hare Coursing Bill which had been passed in another place. One consideration, aside from others, was that that Bill was a Government Bill which would normally have been allowed to go through. I understand that it was because it was not in the published Government programme that that did not happen. I do not know for certain, but that is the explanation that was given. For myself, the fact that the Select Committee was divided, and that this was not made clear to the general public, still rankles. The general impression got about that this was a unanimous decision of the committee, but in fact it was not; the committee was divided four to three. My noble friend Lord Aylestone, the right reverend Prelate the Bishop of Chelmsford and I were opposed, and clearly opposed—if one reads the report of the meeting it is obvious—to the suggestion that the Bill should not proceed. We wanted it to do so.
As a result of the misunderstanding which was allowed to develop I, for one, received a number of letters, mostly from irate women who accused me of all kinds of character faults, of brutality and of being the kind of person who would set a dog on a cat just for the pleasure of doing it, and I suppose that I have a kind of conscience about this. At the time, I dearly desired that that Bill should proceed. It has been tried so many times, and has failed so many times, that I suppose I felt a little guilty, because my colleagues and I were not successful on that occasion. That incident taught me something which I was beginning to assess for myself.
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As the noble Lord, Lord Houghton of Sowerby, has said, this is a highly emotive subject. Where emotion is rife, reason and logic fly out of the window. The people who support hare coursing are, almost without exception, very nice, plain country folk—people one would respect and like to be friendly with without any qualms at all. Surprisingly, however, when it comes to the question of hare coursing they appear to have a blind spot. Because of this, I think that some of our debates went haywire. I am afraid that I found that some of the arguments which were put forward amounted to pure rationalisation, and some of them were entirely inconsistent. We were told, I think correctly, that shooting causes more pain and suffering for the hare than being hunted down by hounds. I am prepared to accept that argument. But it was also explained to us that in certain parts of the country hares are preserved for the purpose of hare coursing, and that at the end of the season they have to be shot so as to keep them under control. So what happens to the argument that shooting is more brutal and more painful for the hare than being hunted by a dog? It falls completely to the ground.
Other arguments were put forward which I was completely unable to accept. We were told by an expert called to give evidence that hares do not experience mental fear or mental pain when they are being hunted. I am sure that many other people besides myself cannot accept that argument. I cannot prove this, of course, but it seems to me to be obvious common sense that if an animal is being hunted and has to run for its life it must experience fear and that that fear must be painful and distressing.
My point in support of the idea of a council for animal welfare is that this kind of question which evokes emotion can better be dealt with by an independent body so that rational thought can be given to the points which are made and so that common sense, logic and persuasion can play their part as opposed to emotions running very high. I fully mean what I say. I know very well that the people who like hare coursing—blood sports, if you like—are perfectly respectable, decent, responsible people who have this blind spot. Having said that, however, I must add, with absolute sincerity, that my profound conviction is that man has a

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duty to other forms of life. He has a duty to treat them with respect and to allow them their own innate dignity. It is wrong for man to use animals, as they are used in hare coursing and in other ways, as a source of pleasure.
I shall leave that question and turn to my own industry. In agriculture, people are closely connected with animals, and I hope your Lordships will agree with me that farmers and farm workers would not willingly inflict suffering upon any animal. There may be exceptions when greed or something else intervenes. I am thinking of the way in which animals are treated when they are transported, particularly when they are transported abroad. By and large, however, the people who work with animals respect them and would not harm them or cause them pain if they could possibly avoid it. My own union, the NUAAW and the National Farmers' Union, have expressed concern about the transportation of live animals both at home and overseas. We know that very undesirable things sometimes happen, again particularly overseas. Cattle are kept cooped up for too long in cattle trucks, with no proper food and without water. There is no doubt that this does happen, but I believe, thank God! that it happens very infrequently. Of course, this is known not only to the farming industry but also to others. The RSPCA and other organisations which look after the welfare of animals have complained from time to time about this practice.
In this connection, I think your Lordships will be interested to know that Sub-Committee D of the EEC Committee have studied and largely welcomed the proposed implementation of Directive 77/489EEC on the protection of animals during international transportation. This was mentioned by my right honourable friend Sir John Silkin in the debate on 23rd March which I have already mentioned. If adopted, this Directive would ensure that a certificate stating the times of loading and export accompanied the consignment of animals and that the times of arrival at the continental port and at the final destination would be added up by competent authorities, together with details about feeding and watering. It is not possible to go into the details of the Directive. However, I can tell your
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Lordships that this Directive is welcomed by the industry and we hope that it will be implemented. We believe that improvements need to be made.
It is getting late and a long speech would not be welcomed. I want to repeat my thanks to the noble Lord, Lord Houghton of Sowerby, for asking this Unstarred Question and to say to the Minister that we sincerely hope that an indication of the Government's view will be given by him. I assure the House that this is a matter of quite considerable concern to the people of this country, and with us they would welcome the institution of a new body of the type which has been proposed.
7.20 p.m.
Lord STANLEY of ALDERLEY: My Lords, if in the few words that I say on this subject I irritate or indeed annoy the noble Lord, Lord Houghton of Sowerby, I hope he will accept that I entirely agree with his aim that animals, not just farm animals (although obviously I am most concerned with them), must be properly cared for, fed and protected from cruelty. Every livestock farmer knows that, if only for financial reasons. It is in the way of achieving that objective that I perhaps differ from the noble Lord. I am pleased indeed to hear that if I take an opposite view to that held by the noble Lord, Lord Collison, he is not necessarily going to condemn me to the nether regions.
At the moment we have the RSPCA, the Farm Animals Welfare Advisory Committee, the Advisory Committee on the Administration of the Cruelty to Animals Act of 1876, Codes of Practice introduced after the Brambell Committee, to which I shall refer later, an active and efficient veterinary service, not to mention special committees that are formed to look at specific problems, such as the one chaired by the noble Lord, Lord O'Brien. In passing, I commend his report to the noble Earl, Lord Grey. It is quite an interesting report. We now have a suggestion that we should have a council for animal welfare. Is it proposed —and I await the Government's reply with interest—that this council, if formed, should take over all the duties of all the bodies that I have just mentioned? If so, I hope the Government can assure me that it will have a majority of farmers

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on it. I ask this because my understanding of the work to be done by the council, reinforced by the words of the noble Lord, Lord Houghton, means that it will mainly apply itself to farm animals, whereas I suggest that it is in the domestic area, particularly dogs, where special attention is required.
So far as farm animals are concerned, I do not think the proposed council will achieve anything for two main reasons. First, it is dangerous to legislate or regulate to prevent cruelty to farm animals, partly because we ourselves differ—and I have said this in your Lordships' House before—on what is and what is not cruel, but more so because one person can do certain things to animals and cause suffering, whereas another person doing the same job does not.
I will bore your Lordships for one moment by giving a perfect example. I used to drive my own lorry to Anglesey from Oxford with cattle and when I got there, even though I had obeyed (as I thought) scrupulously all the rules and regulations when I unloaded my cattle they looked as though they had been on an overcrowded commuter train. Recently, I had somebody else drive the lorry. I am fairly certain, if not sure, that he breaks a considerable number of the regulations regarding breaks, but when the cattle get out they really do look as though they have had a first-class ticket on Concorde. Therefore, I say that one person can do something to an animal and get away with it and another person cannot.
I could give exactly the same story of a case of ewe lambs coming from Scotland, but I will not bore your Lordships further. However, I doubt very much whether the proposed council for animal welfare would appreciate such a thing, or indeed be able to countenance such rule-breaking. Indeed, I believe they would be tempted by their very existence to suggest and make even more regulations and rules.
Secondly, I ask, what will this council do? It will be a Quango. I hasten to add that I am not against all Quangos, quite obviously; what about the wool board or indeed the milk board—where would I be without them? But being a Quango it will be accused, it may be unjustly, of sitting in comfort in Whitehall for the sole purpose of irritating and
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pontificating. Your Lordships may say that I am being unfair and I accept that I may be—indeed I am—but what I will not accept is that the great majority of those whom the council will be trying to influence will not, for better or for worse, take that unfortunate view, and therefore the work and advice that the council will do and will give would be—or could be—non-productive.
I also believe that there will be a tendency for the council to make useless pronouncements. After all, they have to show that they are being useful and worth their money. As an example may I remind your Lordships of the criticism which was levelled at the welfare code for sheep. Originally these codes were set up to recommend rules for intensive livestock, but so carried away did they get that they very stupidly produced a code for the welfare of sheep which your Lordships may remember got a pretty rough passage in this House, but nothing like the criticism which it received from shepherds and the farming Press, who made the code a laughing stock as a piece of bureaucratic interference. That is exactly what I fear the council for animal welfare would be tempted into doing and, as a result, its efforts would be counter-productive.
So far as farm animals are concerned, I believe the answer lies in trusting human nature a little more and, in particular, the effects of financial loss which all concerned always suffer if cruelty occurs. I believe we have sufficient watchdogs already, and I certainly welcome such specific inquiries into cruelty as the O'Brien Report, but I ask the Government to think very carefully before saddling farmers with more committees, councils and Quangos. We surely have enough of them on our backs already.
I should not pontificate on domestic animals, but I think that the Government are quite capable of producing legislation, with the help of Parliament, to control, say, dogs eating my sheep, or updating the 1876 Cruelty to Animals Act, without having a Quango to advise them. Indeed, I agree with what I think the noble Lord, Lord Houghton, said; that such a council might actually stop the Government doing anything. They would spend their time thinking about it rather than actually doing anything about it, but I await my noble friend's reply with interest.
7.28 p.m.
The Earl of HALSBURY: My Lords, I should like to start by thanking the noble Lord, Lord Houghton of Sowerby, for raising this matter and giving those interested in it an opportunity to air their own views. At the same time I should like to apologise for missing the first few minutes of his speech, to which hurried when I saw his name indicated. I should like to refer first to his plea for moderate leadership and also to thank him for the exercise of that moderate leadership. Since he assumed the leadership of what I might call the animal protection lobby in Parliament it has been possible for the first time, because of his personal qualities, for the leader of that lobby and myself as the leader of the lobby dealing with the use of experimental animals for medicine and science to talk to one another and trust one another. The fact that I can tell the noble Lord in confidence what I am doing and he can tell me in confidence what he is doing, and that we trust one another and that he is an honoured guest at the annual dinner of the Research Defence Society, of which I am president, is entirely due to the personal qualities of the noble Lord and I should like to pay tribute to him. That does not mean that I agree with him or with his political friends on a large number of matters.
During the period of the party conferences last year there was a move—and I will not say that the noble Lord was entirely detached from it—under the slogan of "Bring Animals into Politics" to do the exact opposite of what I want to do, which is to keep animals out of politics. At the annual general meeting of the Research Defence Society, which exists in order to provide Parliament and the media with accurate information as to what goes on in the world of experimentation, I said that if the scientific community would back me I would take the responsibility for introducing a Bill into your Lordships' House to re-enact the Cruelty to Animals Act 1876 and to bring it up to date. That Bill is now in an advanced stage of drafting with the parliamentary agents and I very much hope that, with the consent of my scientific colleagues, I shall be able to clear it for submission to your Lordships for a First Reading before we depart for the holidays. The noble Lord, Lord
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Houghton, has been in my confidence in regard to this and he has had all the drafts of the Bill.
He has never broken confidence for one moment, and I am now telling him that he is released and he can talk to his heart's content from now on. I have had many valuable suggestions from him in the course of drafting. During the lifetime of the last Government I had many confidential discussions with the Home Office on the terms of the Bill and I was lucky enough to be able to engage an ex-Home Office chief inspector as my chief draughtsman, as it were. During the course of our conversations I was able to have a conference with the noble Lord, Lord Boston of Faversham, and the then Home Secretary on the subject, and so far as I know his Department highly approved of the terms of that Bill. I am looking forward to the opportunity of discussing exactly the same matters with the noble Lord, Lord Belstead, in due course.
This, I believe, illustrates the merits of taking one subject at a time and not setting up the kind of council which the noble Lord, Lord Houghton, has in mind. If one wants a forum for public discussion, rather like a court as opposed to the senate of a university, a body which could make, as it were, pronunciamentos officially, and ask people to take cognisance of them, I would not have any objection to that. But if you want a body to do something it must have sufficiently confined terms of reference for the places on it to be filled by people who know the subject matter; and we cannot have people who know the subject matter on every aspect of animal usage that there is. The animal on the farm is one thing; the animal in transport is another; the animal in the slaughterhouse is a third, and the animal in the laboratory is a fourth.
Different Ministries are naturally in-spanned, as it were, into the supervision of the animals. Naturally, it is the Minister of Agriculture, Forestry and Fisheries which is concerned with farm animals, and must be. The Home Office is the keeper of our conscience in relation to experimental animals, and so on. Therefore, I believe more progress will be made if we deal with subject matter blocks in parallel, rather than trying to wrap them up in one all-embracing organisation. Therefore, while the noble

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Lord has pleaded with the noble Lord, Lord Belstead, to follow up the announcement of the last Government, I would plead with him not to do anything of the kind but to follow the line I am indicating.
For twenty years I have been the spokesman in this House of the lobby that uses experimental animals for medical and scientific purposes. I have always pledged myself in this House that I would never justify publicly anything that I condemned privately and that my private conscience and my public utterances should be aligned with one another. During the course of that twenty years certainly over three million animals have been used in laboratories for which I have had executive responsibility. I have always taken the trouble to go and look at some of these experiments myself to satisfy myself that what was reported as taking place was actually taking place.
In the case of the smoking dogs I went up to Alderley Edge, where the dogs were used, and I talked to the dogs, which was the best way of getting information about the extent to which they objected to a habit which gives so much pleasure to human beings. The noble Lord, Lord Collison, is one of those who gets a lot of pleasure from it. Why should it necessarily be cruel to request animals to co-operate in finding out? I am sure your Lordships have all talked to a dog at some time or another. If it kisses your hand and wags its tail and jumps up and asks to be petted, you know it is not a frightened dog. The animals did their smoking for two hours in the morning and two hours in the afternoon, had an hour's exercise, an hour in company with other dogs and the weekend off. Generally speaking, they jumped for joy on Monday morning when their trainers came along to re-commence the smoking exercise. The object of the exercise was to test the carcinogenic properties of a new smoking mixture which had been evolved between ICI and one of the tobacco companies (I think it was the Imperial Tobacco Company) in the hope that it would be less carcinogenic than normal tobacco. Had that experiment succeeded —and it may have succeeded; I do not know—large numbers of human lives might have been saved.
I cannot accept the strictures of my old friend Lord Collison. We worked
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together as colleagues in the gas industry for many years, and know one another well, and have debated this privately. It is not an example of sheer torture. The Dray test, in which one uses the eye of a rabbit to see whether there are any ill-effects from a cosmetic, is, of course, only employed where one has good reason to suppose that the substance in question is innocuous. You do not drop sulphuric acid into rabbits' eyes to find out if it burns them; you know it does, because criminals throw sulphuric acid at human beings and we know what the effect of sulphuric acid is. The presumption on all these matters tested for safety is that they are safe. It is only the exceptional instance that is not safe, and when this occurs and the animal is in pain the experimenter would have to put the animal down in accordance with the requirements of the Home Office, which is the keeper of our conscience on this matter. Therefore, the Dray test on rabbits is by no means as horrible as it can be made to sound if you want to arouse emotions in people.
Lastly, perhaps I may deal with a matter which the noble Lord, Lord Collison, mentioned, stress situations. Following traffic accidents very large numbers of human beings die on the way to hospital from what is called multiple injuries. They do not die from loss of blood; they pass into a state of shock and they quietly die. Nobody knows why. If one could find a remedy for this, it would save very large numbers of human lives every year. Therefore, experiments are done to put rats, which are normally used, into a state of shock. At this point, the idea of inflicting multiple injuries on a rat might appear to your Lordships to be a very objectionable procedure and it could be reported in such terms that your Lordships would revolt against the idea. But you would not be told that, of course, the rat is aneasthetised first, and that it recovers into a state of shock in which, by comparison with human subjects who have recovered, we know that it knew nothing about what was going on. It eventually dies in a state of shock never having recovered consciousness in the normal sense of the word.
These experiments put that way sound very much more permissible than if they are reported the other way. I have taken

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a lot of trouble always to satisfy myself that I have personally seen anything that I was going to defend in your Lordships' House. The problems of the farms, the problems of the slaughter-houses and transport are not of concern to me. I believe that they entail quite a different philosophy to experimenting with animals. Something like five million animals are used in experiments every year and die in due course. We eat some thirty million animals, a very much larger number, and I imagine that however humanely you slaughter an animal there is some element of pain for it. You will never get a uniform philosophy about man's relationship to animals. It is emotionally charged; different people have different views.
I am not going to make a Second Reading speech on my Private Bill, which has not yet had a First Reading—
"Let not him that putteth his armour on boasteth himself as he that taketh if off".
If there is a printing strike between now and the holiday I shall not be able to present it to your Lordships for First Reading, but I shall try very hard in order that those who are interested can take it away for the holidays, before the next term begins, and, as it were, get it under their belts before we, I hope, give it a Second Reading in the autumn. I think that that concludes what I wanted to say this evening, somewhat spontaneously, as I have been attending an Opposed Private Bill Committee all day. However, I should once more like to thank the noble Lord, Lord Houghton of Sowerby, for the personal qualities which have put him in the position of leadership that he now occupies.
7.41 p.m.
Lord BOSTON of FAVERSHAM: My Lords, my noble friend Lord Houghton of Sowerby has performed a most valuable service this evening in raising this question. He has an extensive knowledge of animal welfare matters and a distinguished record on these matters both inside your Lordships' House and in the role that he fulfils outside. He has again shown his persistence and determination tonight in seeking reforms.
I had intended to be brief, but so comprehensively has my noble friend
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dealt with this subject that I am able to be even more brief. But, first, lest it should be misunderstood, I should perhaps declare what might be regarded by some as an interest, but is not in fact. I happen to live on the Isle of Dogs. However, I can assure your Lordships that so far as I know that does not affect one's judgment on this question one way or another; nor does it indicate a predisposition towards one type of animal—indeed, we happen to have two cats. My only concern is that we shall not be adjudged guilty of cruelty for keeping cats on the Isle of Dogs.
The subject which my noble friend Lord Houghton has raised is of great importance. Indeed, I believe that it is of growing importance. There is, I think, increasing interest and concern among people about animal welfare and protection and the treatment of animals. That could be bad as well as good: bad if it reflects increasing cause for concern, but good because I believe that a society which can show a growing concern for the well-being of animals is in fact for that an increasingly more civilised society.
The last Government shared the growing concern about the treatment of animals, which is one reason why my right honourable friend the then Prime Minister, Mr. Callaghan, announced on 22nd March this year the setting up of a council for animal welfare. In the last debate that my noble friend Lord Houghton initiated in your Lordships' House on the subject of animals on 7th December last year, his final question, at column 379 of the Official Report, was whether my noble friend Lord Strabolgi, who was replying for the Government, had anything more to say about the consideration being given by the then Government:
"to the setting up of a standing commission or committee to inquire into a wide range of matters concerning animal protection and welfare?"
I know that my noble friend Lord Houghton had occasion to assert, more than once, that the last Government did not do as much as he would have wished on animal welfare matters. But he also has occasion to praise them from time to time. It was within four months of that debate that the announcement for the council was made: and it was a measure of the importance with which that Government regarded the subject that

1197
it was, in fact, the then Prime Minister who announced that decision. The decision followed and no doubt stemmed partly from the pressure from my noble friend and others, and from suggestions from the National Executive Committee of the Labour Party and the Farm Animal Welfare Co-ordinating Executive, for some permanent independent advisory body which could advise the Government on animal welfare matters.
It is true that, as was made clear when the announcement was made—and as I think my noble friend has mentioned tonight—the terms of reference of the council had not yet been finally decided. But the preliminary guidelines and reasons for setting up the council were plain enough and my noble friend has already referred to some of the indications which were given when that announcement was made—albeit perhaps somewhat in parenthesis—and the kind of things it was envisaged by the then Government that that council would do, and indeed would wish to do. Among other things he referred to looking at the existing machinery for animal welfare matters. One part of that machinery is the Advisory Committee on the Administration of the Cruelty to Animals Act 1876. Here I should like to interpose a question to the noble Lord, Lord Belstead, who is to reply for the Government tonight, and ask him what is the present position concerning that advisory committee on the 1876 Act. It was—at the time the announcement was made—soon to be reconstituted with new terms of reference. However I hasten to add that I do not necessarily need an answer tonight and would be quite happy with a written reply later.
My noble friend Lord Houghton has also indicated that it was clear at the time that the announcement was made what could be the areas for consideration by the Council when it came to undertake its work. Here again I do not need to go into the details which my noble friend set out. One specific matter has been referred to tonight under the heading of "Field Sports" which was among those matters referred to by my noble friend Lord Houghton. My noble friend Lord Collison raised the question of hare coursing which is, indeed, one of the matters which could be considered by the council. He will no doubt be interested to know that, in fact, this very day my
1198
noble friend Lord Blease has drawn my attention to the fact that there is widespread concern, not only in Great Britain, but also in Northern Ireland, for action, particularly so far as that matter is concerned.
My noble friend Lord Houghton also mentioned that although it was not intended by the last Government that the new council would investigate individual complaints, it was envisaged —and this is no doubt a matter which the council itself would wish to encourage—that the public would be free to write to the council on any policy matter affecting the welfare of animals; and that the council would follow up matters raised by the public with the appropriate existing representative bodies.
So, it is true to say that even in the absence of precise terms of reference actually being announced, a great deal of background work had been done by the last Government before the announcement was made to set up a council. It was certainly not some hasty and ill-considered idea. Indeed, some people might say that its gestation period was perhaps too long. So it was a well thought out concept and the aim was to provide a completely new and independent approach to animal welfare in this country.
There is, as we know, a vast amount of somewhat fragmented legislation on this whole subject with, as some of the principal measures, the 1876 Act, the Protection of Animals Act 1911, the Slaughterhouse Act, and so on. It may well be that we are reaching the stage where consolidating legislation is called for; I do not know, but that is one major task that the council would no doubt wish to consider.
We must also bear in mind, when considering the revision of our law on this matter, the need for reforms in a European context as well. Here I would interpose my only other question to the Minister, and again I do not press for an answer tonight. However, further Eurpean moves are in train and I believe that meetings to consider reforms were planned for around the middle of this year. Any agreement reached as a result would be expected to give rise to new national legislation. I wonder whether the noble Lord, Lord Belstead, could give some indication of any progress being made or

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the stage now reached on the European Front. As I have said, later will do for an answer to that question as well.
We in Britain—despite the need that many people see for further reform here—have established something of a reputation for leadership in this whole sphere, including internationally. The 1876 Act itself is perhaps one early indication of this, albeit that it needs review and revision and we have heard of one plan for that from the noble Earl, Lord Halsbury, in the speech which he has made to the House tonight. It is vitally important, in my submission, that we may maintain and develop this leadership. Like my noble friend Lord Houghton and other noble Lords, I believe that the way a society treats its animals is an indication of the nature of the society itself. To tolerate the infliction of unnecessary suffering can coarsen the whole attitude to living things and diminish respect for life itself. I believe that the proposed setting up of the new council is one step towards creating a still more civilised society. Not to take that step would mean that a real opportunity would be lost. Therefore, I very much hope that the Government will seize this opportunity and go ahead with this proposal, or something equally suitable. I join my noble friend in pressing for that.
7.51 p.m.
The PARLIAMENTARY UNDER-SECRETARY of STATE, HOME OFFICE (Lord Belstead): My Lords, I am in no way surprised that the noble Lord, Lord Houghton of Sowerby, has raised this Question today, for no sooner had the new Parliament met than the noble Lord spoke in the debate on the gracious Speech on this subject. But animal welfare is an issue which concerns us all, as I know the noble Lord appreciates. Therefore, the Government are reviewing the proposal made by the previous Administration to set up a council for animal welfare and we shall announce our plans as soon as we are in a position to do so. As we made clear in our election Manifesto, the welfare of animals is a concern of the Government. In his opening words the noble Lord said that he wanted to see some action in this area. My answer to that is that there are
1200
problems to be faced—many of them have been referred to this evening—and we shall act where we find it to be necessary.
Before I go any further I should also like to answer the final question which I think the noble Lord, Lord Houghton, put to me—namely, the question of consultation with Government. The door to the department of my right honourable friend is most certainly open to the noble Lord. Indeed, I understand that arrangements are at this moment being made for the noble Lord to meet my right honourable friend the Secretary of State at the Home Office within the next few weeks.
As a Government, we are pledged to update the legislation on experiments with live animals. In his speech the noble Lord, Lord Boston of Faversham, asked me to refer specifically to the European context. At the present time the United Kingdom is making a substantial contribution to the current discussions on the draft of a European convention for the protection of laboratory animals. I suppose that the biggest change likely to come out of that is the introduction of a statute-based system of control over the breeding of and dealing in laboratory animals. I should like to record that earlier this year the Home Office had full consultations with the committee of the noble Lord, Lord Houghton—the Campaign for the Reform of Animal Experimentation—and with the research interests in this country in order to discuss the form and the content of a preliminary draft of this European convention. The interested organisations have been sent details of the latest Strasbourg negotiations, and I give an assurance that we shall maintain these consultations, which are obviously of great help to the Government.
The noble Lord, Lord Boston, also asked me about the updating of the 1876 Act. Here again I can give an assurance that, as these negotiations on the European convention develop, we shall undertake preparatory work on the revision of the 1876 Act; so that when the details of the convention have been finalised, the Government will be in a position to introduce legislation. In doing that, not only, of course, will the Government listen to views expressed both inside and outside Parliament, but we shall also listen care-

1201
fully to the views of the noble Earl, Lord Halsbury, who is preparing his own legislation.
In addition to legislative changes in this area of animal welfare, proposals for the reconstitution of the Advisory Committee on the Cruelty to Animals Act's functions and membership have been on the stocks for a number of years. Indeed, the noble Lord, Lord Houghton, and his colleagues have given consideration to the matter and formulated proposals. This evening I can simply say that the Home Secretary has this whole question under consideration. Meanwhile I must make it clear that we very much appreciate the work which the advisory committee has done in the past.
The last major work of that committee under the chairmanship of the noble and learned Lord, Lord Cross of Chelsea, was examination of the experimental procedure known as the LD50 test to which the noble Lord, Lord Houghton, referred in his speech on the debate on the gracious Speech. I thought that noble Lords might like to know this evening that the committee's report on this difficult subject, although received only last month, none the less leaves me in a position where I can say that the recommendations of that report are acceptable in principle. We are now considering how they may best be implemented within the resources available.
Lord HOUGHTON of SOWERBY: My Lords, does that mean that we shall have a sight of this report soon? For example, will it be published?
Lord BELSTEAD: My Lords, I am not in a position this evening to be able to say that it will be published. This is a matter which the noble Lord may care to discuss with my right honourable friend when he speaks to him at the Home Office.
As regards the future of the export trade in live food animals, about which many of your Lordships have spoken this evening, and the welfare of animals on farms, many of the problems are both domestic and international. In the domestic context we must bear in mind the veterinary and other staff resources which we currently command, and will be able to pay for, at a time when public expenditure has to be kept under very strict limits.
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We must weigh that use of resources against the benefit to be gained where the protection of farm animals is concerned.
The noble Lord, Lord Boston, asked me to go to the European context. In the international context we have already said that the Government will support the EEC proposals for the new Directive designed to implement in detail the current Directive on the protection of animals during international transport. The noble Earl, Lord Grey, expressed his concern about the whole idea of the export of live food animals. I was grateful to the noble Lord, Lord Collison, who spoke from his immense experience, for pointing out—and it may not dispel the noble Earl's concern, but coming from the noble Lord, Lord Collison, it should allay it—that one of the effects of the proposed Directive to implement Directive 77/489 is the introduction of what will be called the "travel document" which will log the times at which journeys start and when those journeys pass through particular checkpoints, so that intervals between feeding and watering can be adequately monitored and appropriate action taken.
In the European context we shall also continue to play a constructive part in the work of the Council of Europe's Standing Committee, which is preparing recommendations for the detailed implementation of the European convention on the protection of animals kept for farming purposes. The way in which this work is carried on will, of course, be dictated by the policy decisions now in the process of being reached. Therefore, although there are—as it is clear from this evening's debate—a number of farm animal welfare issues currently of great importance (and I have not referred to them all) we should not lose sight of the degree to which the welfare of these animals is already being looked after.
When all is said and done, in the United Kingdom there is a considerable body of legislation providing for the welfare of farm animals, and although some of it needs no alteration, some may well need to be changed. But it is built into the fabric of our society as a practical witness to public concern. This country has a long and honourable tradition of caring about the welfare of animals, and as our scientists and vets become more

1203
knowledgeable about the needs of animals, legislation and advice can be developed closely to meet them.
I was particularly glad that the noble Lord, Lord Collison, made the point that in this country the majority of livestock farmers and people working with animals on farms will never willingly harm their own animals. The two things, I hope, do not go together, but, in addition, they are also well aware that they will not maximise their profits if they do not care for their animals humanely. That, in itself, should be a safeguard.
As the House knows, agriculture Ministers have advice from the Farm Animal Welfare Advisory Committee; an independent body which they appoint. The State Veterinary Service carries out specific welfare visits to farms and other commercial livestock premises, and this in its turn provides a valuable safeguard. Moreover, our welfare organisations—which, as a matter of fact, rather uncharacteristically we have not mentioned this evening—are absolutely second to none in this country in the unremitting watch which they keep over the welfare of farm as well as other animals. In addition to all that, we have the general oversight of the Cruelty to Animals Inspectorate and the benefit of the Advisory Committee on the 1876 Act.
In drawing attention to this list of facts, with which I have deliberately ended up, I must stress that the Government are not in the same breath going to say that they are complacent about animal welfare. But, at the same time, we are not prepared to adopt proposals made at the tail end of the last Parliament without very careful consideration of the full implications. One of the implications, which was revealed so clearly in the shrewd speech made by my noble friend Lord Stanley of Alderley, was that it would be a matter of extreme controversy as to who should be sitting upon, and represented at, a new council. We are therefore studying the proposal for a council for animal welfare in the context of our undertakings, and in the light of our expressed views about the best way to make improvements.
As to the latter, I have in mind the views expressed by my honourable friend Mr. Peter Mills in the debate on 23rd
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March in another place when he left no one in any doubt that we want to act quickly where there are problems, but that we question whether the setting up of such a council, in addition to the two advisory committees and a third advisory committee on animal transport, which I understand the previous Government were considering, would really be the right way to deal with these problems. That is why we are taking a little time to go into these problems, their implications and the possible solutions. That is why I am asking you, my Lords, to be patient for a little longer until the Government can give a fuller declaration of their plans for the future.

  LNG/LPG ESTABLISHMENTS: ACCIDENT REPORTS
  LNG/LPG ESTABLISHMENTS: ACCIDENT REPORTS
  GAS CLOUDS: RADIUS
  GAS CLOUDS: RADIUS
  ENERGY-SAVING PROPERTY IMPROVEMENTS: RATEABLE VALUES
  ENERGY-SAVING PROPERTY IMPROVEMENTS: RATEABLE VALUES
  EUROPEAN ASSEMBLY ELECTIONS: UK CITIZENS' FRANCHISE
  EUROPEAN ASSEMBLY ELECTIONS: UK CITIZENS' FRANCHISE
  WORKING PARTY ON THE REPATRIATION OF PRISONERS
  WORKING PARTY ON THE REPATRIATION OF PRISONERS
  SPECIAL CONSTABULARY: STRENGTH DECLINE
  SPECIAL CONSTABULARY: STRENGTH DECLINE
  THE ALKALI INSPECTORATE
  THE ALKALI INSPECTORATE
  ECONOMIC PLANNING COUNCILS
  ECONOMIC PLANNING COUNCILS